As a bank, you can't easily liquidate them without that showing up as a huge loss, thereby affecting your reserve requirements and potentially making you insolvent.
If you don't have to sell them and can keep them to maturity, they don't appear as a loss in your accounting.
It's the difference between mark-to-market versus held-to-maturity accounting. If you have to sell, you are forced to mark-to-market. If you don't have to sell, you don't have to account for losses due to bond prices falling in the market.
If you don't have to sell them and can keep them to maturity, they don't appear as a loss in your accounting.
It's the difference between mark-to-market versus held-to-maturity accounting. If you have to sell, you are forced to mark-to-market. If you don't have to sell, you don't have to account for losses due to bond prices falling in the market.