As you guys know, my concern going into second half is the treasury bond issuance taking longer rates higher, causing another liquidity squeeze on banks as depositors/investors move money there to take down the supply. Regulators somewhat see this coming w the new guidance on…
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@commbankerguy
Other than off balance sheet (FRB discount window, max FHLB lines, set up for brokered CDs) what are your practically doing? IP run off is tougher with high rates, outright sales unpalatable, and so all that’s left is tightening rates/demand on lending no?
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@commbankerguy
This is happening with a few banks in the sf Bay Area. They say they can’t lend until they get their deposits in line.
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@commbankerguy
Maybe time to start selling those long-term securities take the loss to raise liquidity and move forward. So many are so hobbled by them, and basically borrowing from the Fed. As an investor it's frustrating to watch. If rates do rise avoid further AOCL.
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