Data and Technology Strategy

A core CECL transformation component

The Financial Accounting Standards Board (FASB) issued the final current expected credit loss (CECL) standard on June 16, 2016. After the financial crisis in 2007–2008, the FASB decided to revisit how banks estimate losses in the allowance for loan and lease losses (ALLL) calculation.

The transition to the CECL model will bring with it significantly greater data requirements and changes to methodologies to accurately account for expected losses under the new requirements.

KPMG’s new paper, CECL Data and Technology Strategy, discusses results of the CECL survey covering 130 institutions (banks, insurers, and specialty finance) and reflects that the organizations were considering review and reengineering of their current risk and finance data integration architecture for their CECL initiative.