Bank Analysis School Case Study eBook
Sunny State Bank
SECURITIES PORTFOLIO
Securities Mix Qtr
Securities Volume and Mix (Bond Types)
50M
20 X5 Q4
Securities Mix (Bond Types)
40M
30M
Metrics
31.1%
20M
Corporates/Other CMOs/CMBS/ABS Pass Thru MBS Municipals Treas./Agency
50.2%
10M
18.7%
20X5Q3 20 X5 Q4
20X9Q2
20X9Q3
20X9Q4
20X0Q1
20X0Q2
20X0Q3
20X0Q4
20X1Q1
20X1Q2
20X1Q3
20X1Q4
20X2Q1
20X2Q2
20X2Q3
20X2Q4
20X3Q1
20X3Q2
20X3Q3
20X3Q4
20X4Q1
20X4Q2
20X4Q3
20X4Q4
20X5Q1
20X5Q2
Securities Mix (Accounting Designation)
Securities Volume and Mix (Accounting Designation)
35M
30M
25M
20M
Metrics
15M
HTM Securities AFS Securities
10M
5M
100.00%
20X5Q4
20X9Q2
20X9Q3
20X9Q4
20X0Q1
20X0Q2
20X0Q3
20X0Q4
20X1Q1
20X1Q2
20X1Q3
20X1Q4
20X2Q1
20X2Q2
20X2Q3
20X2Q4
20X3Q1
20X3Q2
20X3Q3
20X3Q4
20X4Q1
20X4Q2
20X4Q3
20X4Q4
20X5Q1
20X5Q2
20X5Q3
20X5Q4
Evaluating the composition of the securities portfolio is important to understand its contribution to a bank's risk profle. Different bond types have varying degrees of credit risk and marketability. For example, corporate bonds tend to have more credit risk than other bond types, and Municipals may be less liquid (especially non-rated issues). Available for Sale (AFS) bonds can be sold, while accounting rules prohibit Held for Sale (HFS) bonds from being liquidated. AFS bonds are reported at fair value, whereas HFS bonds are reported at amortized cost.
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