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US regional banks' AOCI losses widen amid rising Treasury yields

Created at 3 Aug · 3:41 AM1 source↑ Market-relevant
IN SHORT

Accumulated other comprehensive income (AOCI) losses at seven US regional banks increased by $951 million in Q2 2026, reaching $12.9 billion. This widening deficit is attributed to rising long-term interest rates pressuring the valuation of fixed-rate securities.

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Key Numbers

$951 millionincrease in negative AOCI
8%quarterly increase in negative AOCI
$12.9 billionaggregate negative AOCI
one yearhighest level of negative AOCI

Who's Involved

Risk Quantum
analyst of seven US regional banks
Fifth Third Bank
one of the analyzed US regional banks

↳ Why This Matters

Widening AOCI losses indicate a decline in the unrealized value of banks' investment portfolios, potentially impacting their capital ratios and overall financial health. This trend highlights the sensitivity of regional banks to interest rate fluctuations.

Key facts

  • US regional banks' accumulated other comprehensive income (AOCI) losses widened in the second quarter of 2026.
  • Rising long-term interest rates pressured the value of fixed-rate securities.
  • Aggregate negative AOCI among seven analyzed banks increased by $951 million.
  • The total negative AOCI reached $12.9 billion, the highest level in the past year.

US regional banks experienced a widening of their accumulated other comprehensive income (AOCI) losses in the second quarter of 2026. This deterioration was driven by an increase in long-term interest rates, which negatively impacted the valuations of their fixed-rate securities portfolios. According to an analysis by Risk Quantum, the aggregate negative AOCI among seven regional banks grew by $951 million, or 8%, during the quarter. This brought the total negative AOCI to $12.9 billion, marking the highest level observed over the preceding year. The report specifically mentions Fifth Third Bank as one of the institutions analyzed.

Frequently asked questions

Accumulated Other Comprehensive Income (AOCI) represents unrealized gains or losses on certain investments, such as available-for-sale securities, that are not included in a company's net income until realized.

When interest rates rise, the market value of existing fixed-rate securities with lower coupon payments falls. This decrease in market value leads to unrealized losses, which are recorded in AOCI.

The analysis covered seven US regional banks, including Fifth Third Bank.

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Cadence
CME Headlines
  • 10-Year Treasury Note futures slip as yields touch YTD high.
    31 Jul · 9:03 PM
  • 10-Year Treasury Note futures slip as yields touch YTD high.
    31 Jul · 9:03 PM
  • Gold futures slip as rising Treasury yields weigh on prices.
    31 Jul · 8:39 PM

How It Developed

US regional banks' AOCI losses widened in Q2 2026.
Aggregate negative AOCI among seven analyzed banks increased by $951 million.
Total negative AOCI reached $12.9 billion, the highest in a year.

Sources

T1
AOCI losses widen at US regional banksRisk.net

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