Results 281 to 290 of about 1,161,301 (335)

How Does Loan Loss Accounting Influence Bank Lending? Evidence from the Current Expected Credit Loss (CECL) Model

Accounting Review
I explore the real effects of an update in loan loss accounting, the current expected credit loss (CECL) model. Although CECL’s predecessor only required banks to recognize losses after an event that made a loan uncollectible, CECL requires banks to ...
Hsiang-Chieh Yang
semanticscholar   +1 more source

The Effect of the Current Expected Credit Loss Approach on Banks’ Lending during Stress Periods: Evidence from the COVID-19 Recession

Accounting Review
In the wake of the financial crisis, policymakers expressed the concern that the incurred loss model delays loan loss recognition to economic stress periods and thereby exacerbates banks’ lending contraction during these periods.
Jing Chen, Yiwei Dou, Stephen G. Ryan, Youli Zou   +3 more
semanticscholar   +1 more source

Unrecognized Expected Credit Losses and Bank Share Prices

Journal of Accounting Research, 2021
ABSTRACTAccounting for credit losses under U.S. GAAP is transitioning from an incurred to an expected loss model. The model change was motivated by concerns that reporting only incurred losses does not provide investors with sufficient and timely information about banks’ credit risk. In this paper, I develop a measure of lifetime expected credit losses
openaire   +1 more source

The Effect of the Current Expected Credit Loss Model on Conditional Conservatism of Banks and Its Spillover Effect on Borrower Conservatism

Accounting Review
Under the Current Expected Credit Loss (CECL) model, banks should fully recognize expected lifetime credit losses upon loan origination while gradually recognizing interest revenues.
Xinrong Qiang, Jing Wang
semanticscholar   +1 more source

Variance Compression Bias in Expected Credit Loss Estimates Derived from Stress-Test Macroeconomic Scenarios

Social Science Research Network
Global head of research at Aguais and Associates (AAA), a start-up, financial-technology firm. He leads the firm’s credit-risk analytics research, development and design.
Lawrence forest, Scott D. Aguais
semanticscholar   +1 more source

What Do Analysts' Provision Forecasts Tell Us about Expected Credit Loss Recognition?

, 2020
We examine the incremental predictive ability and information content of analysts’ provision forecasts to explore the potential effects of the FASB’s new current expected credit loss (CECL) accounting method.
Anne Beatty, Scott Liao
semanticscholar   +1 more source

A spline hazard model for current expected credit losses

Journal of Financial Economic Policy, 2021
PurposeThe purpose of this paper is to present a comprehensive framework for assisting lending banks in their current expected credit losses (CECL) forthcoming computations.Design/methodology/approachThe bottom-up approach requires multiple steps including the spline method for identifying optimal segments in the lifetimes of loans, Poisson regressions
openaire   +1 more source

The Decision Usefulness of Current Expected Credit Losses: Users’ Views about the Current Expected Credit Losses Model

Behavioral Research in Accounting
ABSTRACT In 2016, the Financial Accounting Standards Board (FASB) issued ASU 2016-13, “Financial Instruments—Credit Losses,” requiring firms to switch to a current expected credit losses (CECL) model. To assess the impact of this new standard, we performed semistructured interviews with analysts, trade group members, and financial ...
Jordan M. Bable, Christopher I. L. Wong, Michael J. Wynes   +2 more
openaire   +1 more source

Expected credit losses in international banking business

Scientific notes
The late and insufficient formation of provisions for credit losses became one of the causes of the global financial crisis of 2008-2009. In response to the challenges posed to the international community by this crisis, the Basel Committee on Banking Supervision developed Basel III requirements for financial institutions, which include including ...
Tetianа Musiiets, Iryna Olshevska, Valeriia Mozhna   +2 more
openaire   +1 more source

Estimating Lifetime Expected Credit Losses Under IFRS 9

SSRN Electronic Journal, 2016
We present an estimation framework of lifetime expected credit losses in accordance with IFRS 9. Rooted in the literature of estimating multi-period default probability, the framework rests on a rigorous definition of "term structure of default probability" and conditional expectation given forward-looking economic dynamics. It is easy to implement and
openaire   +1 more source