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Current Expected Credit Loss (CECL) for Community Banks and Credit Unions

The new FASB Accounting Standard Update means your financial institution must start looking forward when estimating credit loss in loan portfolios. The marketplace is flooded with information regarding the new standard.

Chances are, you’ve read, heard, and accumulated CECL advice and information including:

  • Guidance from your regulators
  • Participation in summarized CECL seminars/webinars
  • Discussion with third-party vendors that may have:
    • Suggested or demonstrated their methods and proprietary model solutions without knowledge of your portfolio, data, human resources or budgets
    • Suggested you begin gathering all the data necessary to run their model

It can be a daunting task to get your hands around all the information that is available.  Rest assured — CECL implementation doesn’t have to be that hard.

FASB and regulators have committed to giving community Banks and Credit Unions broad leeway to adopt simplified implementation using simpler models that leverage existing allowance methodologies.

View the Joint Statement (PDF)
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The CECL experience you want to see

Let Diligent help you filter through the noise to create your own actionable CECL implementation plan.  We’ve provided estimates of current expected loss to our clients since 2009.

Our veteran credit advisory specialists have the experience needed to assist management with these important decisions. Understanding your options and potential outcomes today will help to address CECL requirements, while also providing actionable intelligence affecting provisioning, portfolio management, and capital planning.

We can help you face the future

Your valuation allowance methodology and calculations must change. Make sure you have your plan in place and the tools you need to do the job.

Diligent can help you develop and implement your own plan. Should you need additional assistance implementing your plan, we can help you:

  • Create your CECL model,
  • Validate your data and address data gaps,
  • Create new policies and procedures, and
  • Forecast CECL’s impact on your financial and capital ratios.

 

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