On October 16, 2019, the Financial Accounting Standards Board (FASB) unanimously approved delaying the implementation of the Current Expected Credit Losses (CECL) accounting standard until 2023 for most financial institutions. Under the revised plan, banks that file with the Securities and Exchange Commission, except those defined as smaller reporting companies, will still need to convert to CECL, beginning Jan. 1, 2020. All other institutions will have until 2023 to convert.
This development reinforces the ABA statement that CECL is “the most sweeping change to bank accounting ever.” In the end, CECL implementation will bring about greater discipline in the management, measurement, and forecasting of credit risk, potentially driving improved profitability in the long run.
Lenders have reached out to a variety of 3rd parties to help with the planning and implementation of the new accounting standard. Banes Capital Group, LLC helps lenders maximize their return by using market prices and models to perform comprehensive balance sheet analysis. Modeling results are available for almost any loan type, including QM and non-QM, 1-4 family residential mortgages, auto loans, SBA and agricultural loans. Using state-of-the-art financial models, lenders can make smarter, faster decisions. Actionable data analytics allow lenders more opportunities to acquire and retain customers, enhance operational efficiency, manage risk, and identify opportunities to enhance financial strength. Banes Capital Group, LLC is committed to helping lenders make the very best choices for their balance sheet.
