By filling out a survey sponsored by Abrigo, the leading technology provider of compliance, credit risk, and lending solutions for community financial institutions, you can learn about the banking industry’s progress, preparation, and expected impact of the Financial Accounting Standards Board’s (FASB) new current expected credit loss standard (CECL).
The new accounting standard, which some in the financial services industry have called the biggest accounting change in banking history, will go into effect on Dec. 15, 2019, for SEC-filing financial institutions.
Abrigo is asking financial institutions about their progress with CECL implementation – whether “progress” means the institution is just beginning preparations, is testing potential CECL-compliant methodologies, is running parallel calculations or has successfully adopted the standard on its financial statements. Bankers who complete the survey will be among the first to receive the results once published this spring. Respondents will also be entered for a chance to win several prizes. To take the 2019 CECL Survey, click here.
Not only will the survey’s results help financial institutions benchmark their progress against peers, but they will also highlight how peer institutions are involving various departments in their CECL work. Data collection has been at the forefront of many CECL discussions, and this survey will provide insight into the extent of institutions’ data collection at this point in the transition. Specific methodology or methodologies institutions plan to use will also shed light on how financial institutions are dealing with the various other aspects of CECL implementation.
Last year’s survey revealed that only 2 percent of respondents had completed their CECL transition process.
Other key takeaways from the 2018 survey included:
- 47 percent of respondents expected CECL would make it more difficult to justify their allowance to external auditors and regulators.
- More institutions over $1 billion in assets expected CECL to result in changes to how they price their loan products than did institutions under $1 billion (40 percent compared with 31 percent).
- 32 percent of respondents felt that they had sufficient data (only 19 percent reported this in 2017).
- 28 percent of respondents were evaluating third-party partners to help with the CECL transition, while 31 percent had already engaged some sort of third-party support.
After the 2019 survey closes, Abrigo Risk Consultants Neekis Hammond and Chris Emery will walk through the survey findings, compare the 2019 survey results to those of previous years, and address how financial institutions can be best prepared to meet their respective deadlines. Register for the April 2 webinar to learn more about the results and their perspectives.
Abrigo provides both of the American Banker Association-endorsed solutions for CECL compliance, Sageworks ALLL and MST Loan Loss Analyzer. The company also offers complimentary webinars along with in-person events to assist institutions in their transition. Find out more at Abrigo’s Knowledge Center.