Unrealized losses on US banks’ balance sheets rose in the first quarter of 2026, marking the first quarter-on-quarter increase since the fourth quarter of 2024.
According to another a report Regarding institutions affiliated with the Federal Deposit Insurance Corporation, US banks recorded an increase in unrealized losses of slightly more than six percent in the first quarter.
“Total unrealized losses increased $19.0 billion, or 6.2%, from the prior quarter to $325.1 billion. The 30-year mortgage rate remained relatively flat through the first two months of the quarter but rose in March, reducing the value of mortgage-backed securities reported by banks and increasing unrealized losses.”
As a result, the FDIC says high unrealized losses and weaknesses in some loan portfolios “remain a subject of ongoing supervisory concern.”
Amid the high level of unrealized losses, the Federal Deposit Insurance Corp. says the number of financial institutions on its “troubled bank list” declined in the first quarter.
“The number of listed banks decreased by a net of six in the first quarter to 54 banks. The number of distressed banks was 1.3 percent of the total banks, which is in the normal range of 1 to 2 percent for periods without crises. Three banks were opened and one bank failed during the first quarter.”
The Problem Banks List is a list of banks with financial problems based on a rating system that evaluates capital adequacy, asset quality, management, profits, liquidity and sensitivity to market risk, an acronym CAMELS framework.
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