1st Source Corporation (SRCE) has disclosed a new risk, in the Debt & Financing category.
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1st Source Corporation is facing potential liquidity challenges due to unrealized losses in its available-for-sale investment securities portfolio, which have arisen from rising market interest rates in 2022 and 2023. These losses primarily affect obligations from the U.S. Treasury, federal agencies, and state and local municipalities, with long-term fixed-income securities being particularly sensitive to interest rate changes. Although these unrealized losses reduce the company’s book capital and tangible common equity ratio, they do not impact regulatory capital ratios. The management is actively monitoring the situation and may consider restructuring opportunities, though selling securities before maturity could result in actual losses.
Overall, Wall Street has a Moderate Buy consensus rating on SRCE stock based on 1 Buy and 2 Holds.
To learn more about 1st Source Corporation’s risk factors, click here.
