This isn't a liquidity problem though - the actual fair market value of the assets that they can realistically expect to get has dropped due to interest rates r

This isn't a liquidity problem though - the actual fair market value of the assets that they can realistically expect to get has dropped due to interest rates rising. Someone with $10 million to invest in long-duration government bonds won't pay face value for bonds that pay out $10 million at maturity plus a small amount of annual interest when the government has issued newer bonds with much higher interest payments, they'll expect a discount that accounts for the lower amount of interest paid over the term, but banks have a bunch of bonds like that that are still on their books at face value and haven't been marked to market.