Africa Needs Strong Institutions - Lessons from Bank of America
Bank pass bank. How do you have this type of "loss" and yet the market is not blinking? Yes, no one cares about the paper loss because it is Bank of America. This “loss” was partly what derailed First Republic Bank, Signature Bank and Silicon Valley Bank. People, Africa needs strong and big institutions because they matter!
"In a shocking announcement, Bank of America revealed that it suffered a massive unrealized loss of $131.6 billion on its securities portfolio in the third quarter. This is the largest quarterly loss ever reported by a U.S. bank and represents a significant deterioration of its financial position....
"The bank said that the loss was unrealized, meaning that it did not affect its cash flow or earnings, and that it could reverse in the future if market conditions improve. However, the loss also reduced the bank’s regulatory capital ratios, which measure its ability to absorb losses and comply with regulatory requirements. The bank said that it remained well capitalized and above the minimum thresholds, but that it would take actions to strengthen its capital position."
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