ALLL / De novo

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De novo

• Documentation

  Choosing the right peer group

  Peer analysis is a tool many banks use to provide benchmarks and context for financial results. Selecting that peer group is critical for the peer analysis to be accurate. Too often, banks use peers with whom they compete directly for revenue and do not give regard for the non-revenue parts of the profiles with which they are more closely aligned.

• Data Requirements

  Peer Data

  Peer data can be useful for de novo institutions, but should no longer be used when institutions have a substantive amount of data on their portfolio to perform a historical loss methodology.