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Banks move forward with CECL, expecting no relief

Tammy Whitehouse | March 14, 2019

Despite calls for delay or reconsideration of the pending new model for recognizing loan losses, the biggest banks are moving forward with preparations as if nothing will change.

Some, in fact, are even starting to disclose to investors in numerical detail how their financial statements will be affected by moving to a current expected credit losses, or CECL, model for recognizing signs of trouble in their debt portfolios. “In my conversations with my clients, they are working under the assumption there will be no relief,” says Reza Van Roosmalen, a partner with KPMG. 

JPMorgan Chase, for example, says in its 2018 year-end report the company will increase its allowance for...

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