Current Expected Credit Losses Policy
The purpose of this Current Expected Credit Losses Policy Template (CECL Policy Template) is for a bank, credit union, fintech company, or other type of financial institution to maintain an adequate methodology for estimating and maintaining allowances for credit losses to properly reflect an accurate financial position of the organization and to comply with regulatory and Financial Accounting Standards Board (FASB) guidelines.
Table of Contents
- Purpose and Contents – Topic 1
- Policy Statement – Topic 2
- Definitions – Topic 3
- Responsibility – Topic 4
- Risk Management – Topic 5
- Measurement Methods – Topic 6
- Measurement of ACLs for Loans, Leases, HTM Debt Securities, and Off-Balance-Sheet Credit Exposures – Topic 7
- Measurement of ACLs for Available-for-Sale Debt Securities – Topic 8
- Use of Vendors – Topic 9
- Portfolio Segmentation – Topic 10
- Qualitative Adjustments and Systematic Allowance Processes – Topic 11
- Recommendations, Documentation and Approval – Topic 12
- Audit Policy – Topic 13
- Staff Training – Topic 14
- Retention of Documentation – Topic 15
Recent updates to this product:
OCC Bulletin 2021-20 – Allowances for Credit Losses: New Comptroller’s Handbook Booklet
Joint Press Release – Regulatory Capital Rule: Revised Transition of the Current Expected Credit Losses Methodology for Allowances
Joint Press Release – Agencies Issue Three Final Rules
Joint Press Release – Federal Financial Regulatory Agencies Issue Interagency Policy Statement on Allowances for Credit Losses and Interagency Guidance on Credit Risk Review Systems
Joint Release – Current Expected Credit Losses: Final Rule with Technical Changes to Interim Final Rule
Joint Release – Agencies Announce Two Actions to Support Lending to Households and Businesses
Additional and Updated Interagency Frequently Asked Questions on the New Accounting Standard on Financial Instruments – Credit Losses
Joint Release – Agencies Allow Three-Year Regulatory Capital Phase In for New Current Expected Credit Losses (CECL) Accounting Standard
This Current Expected Credit Losses Policy Template (approximately 54 pages) is available in Microsoft® Word format.
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