Held-to-Maturity
HTM. An accounting classification for fixed-income securities a bank intends to hold until they mature. HTM securities are carried at amortized cost on the balance sheet rather than at current market value, so unrealized losses from rising rates do not flow through reported earnings or regulatory capital -- as long as the bank actually holds them to maturity. When a bank is forced to sell HTM securities to meet liquidity needs (as Silicon Valley Bank was in March 2023), the unrealized losses crystallize and can rapidly erode capital. HTM unrealized losses relative to tangible common equity are a key bank-safety diagnostic.
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Related terms
10Y Treasury · Altman Z-Score · Asset Sensitivity · Basel III · Bond ETF · Bretton Woods
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