Community Banks

Confessions of a Data Analyst

The implementation of CECL has been called the biggest change in financial institution accounting . . . ever. Under current U.S. GAAP, financial institutions account for losses based on historical events or incurred losses. Beginning in the first quarter of 2020, financial institutions must look at the past as well as the future over the full lifetime of a loan. […]

The Fed Speaks: Overview of CECL Model and Supervisory Expectations

On October 30, the Federal Reserve Bank of St. Louis hosted the first of a promised series of online sessions explaining the new standard for estimating the ALLL, known as CECL (Current Expected Credit Loss model) and the options banks will have to implement it. Julie Stackhosue of the St. Louis Fed was joined by Steve Merriett, Joanne Wakim and Shuchi Satwah of the Federal Reserve Board of Governors in Washington, DC. “The delays surrounding CECL’s release by FASB have created skepticism among some that this standard will never come to pass,” commented MST CEO Dalton T. Sirmans. “Steve Merritt’s comment that half of his staff is dedicated 100 percent to CECL, this first in a series of sessions on CECL by the St. Louis Fed, and the numerous warnings or words of caution herein should end any doubt. CECL is going to happen.” […]

2018-10-23T12:53:28+00:00November 12th, 2015|ALLL, Banking, CECL, Community Banks, Education|

CECL Looms Large

AICPA Banking Conference September 2015 Notes on CECL from the AICPA National Conference The AICPA’s 2015 National Conference on Banks and Savings Institutions, held last week outside Washington, DC, in National Harbor, Md., focused on the coming FASB model for determining the allowance, the so-called CECL (Current Expected Credit Losses), which will require banks to base their ALLL calculations on future expectations. Speakers from the various banking regulatory agencies provided their perspectives on the soon-to-be standard, the attention to CECL heightened by the presence of the “fatal flaw” draft and anticipation of a final version and the announcement of a schedule for implementation. […]