ABA, BPI Seek Greater Clarity from Regulators’ Proposed CECL Policy Statement

ABA and the Bank Policy Institute today offered feedback to the financial regulatory agencies on a recently proposed policy statement aimed at providing guidance for institutions implementing the current expected credit loss accounting standard. Among other things, the associations emphasized the need for CECL-related guidance particularly for smaller institutions and urged regulators to clarify their capital management expectations under the CECL framework.

“Given the enormous change that CECL represents, the associations believe that a final policy statement should clarify how expectations related to CECL practices and analyses may differ from current incurred loss accounting and how current practices (such as nonaccrual and charge-off practices) might change,” the groups wrote. They added that the final statement should “reduce conflicting messages from other organizations (such as the [American Institute of CPAs] and [Financial Accounting Standards Board]) as to supporting documentation and internal controls.”


About Author

Monica C. Meinert

Monica C. Meinert is deputy editor of the ABA Banking Journal and editorial director at the American Bankers Association, where she oversees ABA Daily Newsbytes.