Bank of America - Safe or in danger?

It has not been great for the banks.

After SVB and Silvergate's meltdown, even the larger banks are facing scrutiny.

The culmination of SVB's bank run is attributed to a few factors that IF happened simultaneously, would then trigger the bank run.

One of if was being forced to realize the unrealized losses of its securities after a bank run happened.

Naturally, everyone's first instinct of everyone was to check the CET 1 of all US banks and factor in the unrealized losses.

BAC did not look good.

Unrealized losses become realized losses when securities are being forced sold, and the bank has to realize the losses also on their financials.

Thus, one way of scrutinizing this is to look at the deposit levels.

There has been no alarming drop in deposits, plus, BAC has announced a set of rather decent results for its FY 2022.

If there is no need to sell its securities to satisfy any withdrawals, there shouldn't be huge concerns about the enlarged MTM loss of its HTM securities.

But, being safe now, does not mean it can be safe forever...

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