While your response is accurate in the economic sense, that is, most assuredly NOT how regulators see things. Under SEC Rule 15(C)3 Customer Protection, the SEC requires all Broker Dealers to report their capital position (Net Capital) monthly. The Banks have a similar requirement, reporting directly to the Fed if they're of a certain size. Net Capital is computed using the current market value of all holdings. As interest rates rise, those market values fall. So, while there may be no "economic" risk (the bonds or notes will mature at par), nonetheless the Regulators will close any shop that does not have sufficient net capital, based on market value computed monthly. I know I had to perform this function for many years as a FINOP (Financial Principal) for three firms.