Hedge costs money, and the instruments in question were not going to default, given they were government backed, so if they could just hang on until maturity they would get the yield from the day they bought them.
Holding bonds in a rising rates environment also costs money.
Hedging could have been a way to reduce the duration without selling - i.e. without realizing losses as the bonds could still be classified as hold-to-maturity - and avoid further losses.
Hedging could have been a way to reduce the duration without selling - i.e. without realizing losses as the bonds could still be classified as hold-to-maturity - and avoid further losses.
They chose not to.