According to the FDIC's report for the first quarter, the US banking system has a total of $517 billion in unrealized losses and 63 "problem banks". These losses were mainly caused by the increase in interest rates in the past two years, which has pushed down the prices of fixed-income securities held by banks. Compared to the fourth quarter of 2023, unrealized losses held by banks increased by $39 billion in the first quarter. FDIC said: "The rise in mortgage rates in the first quarter led to an increase in unrealized losses on mortgage-backed securities, driving overall growth."

According to data from Realtor.com, since the beginning of this year, mortgage rates have been rising, and the 30-year fixed-rate mortgage in the United States has risen from around 6.6% at the beginning of January to slightly above 7% today. FDIC stated: "This is the ninth consecutive quarter of unusual high unrealized losses since the Fed began raising interest rates in the first quarter of 2022."

From 2008 to 2021, the unrealized losses and gains of the US banking system on investment securities ranged from a loss of up to $75 billion to a profit of just under $150 billion.

At the same time, there were 63 problem banks in the first quarter, up 11 from the fourth quarter of last year - the Federal Deposit Insurance Corporation classifies problem banks as banks with a "Camel Bank Composite Rating" of 4 or 5. Camel rating (CAMELS) measures the financial strength of banks based on six items: capital adequacy ratio, assets, operation ability, income, liquidity, and sensitivity. The rating system ranges from 1 to 5, with 1 representing high-quality banks requiring the least amount of attention and 5 representing the worst performance and requiring the highest level of regulatory attention.

FDIC's data shows that the total assets held by these 63 problem banks in the first quarter were $82 billion, indicating that most of the problem banks are relatively small in size. Although the number of problem banks has increased due to rising interest rates, it should not yet cause concern. FDIC stated: "The number of problem banks accounts for 1.4% of the total number of banks, which is within the normal range of 1% to 2% of all banks during non-crisis periods."