Accounting for credit risk traditionally looks back, at events that have already occurred. So, when International and then U.S. accounting regulators created new sets of forward looking credit-risk rules, it was not just a matter of creating different reports, but also one of adopting a new accounting mindset. For this Dutch commercial bank with U.S. operations, it was a double challenge: building a response that would both comply with U.S. rules, and co-exist with solutions implemented earlier at the holding company level in Europe. KPMG was invited to help the bank address the new U.S. rules.
Working with KPMG, the bank re-examined its credit risk models, processes, data needs and reporting capabilities, making changes informed by its European solutions. More importantly, KPMG helped the bank acquire new cross-border awareness, and lead the way in practicing what many organizations preach – “think globally, act locally.”
In responding to comparable, but-different, credit-risk reporting demands in Europe and the U.S., KPMG teams in the Netherlands and U.S. helped the organization respond in complementary ways to multiple regulatory stakeholders:
KPMG teams in the Netherlands and U.S. worked to help the bank address new requirements for measuring and reporting estimated credit losses on loans and debt securities, as mandated by the Financial Accounting Standards Board’s rule (FASB CECL). KPMG:
We bring deep industry experience to every facet of our credit risk offer, with proprietary benchmarks, frameworks, and libraries specific tested roadmaps and tools – all specific to financial services.
Clients appreciate our ability to advise them from a holistic, 360-degree perspective that includes how new data analytics, systems, and technology will impact their people.
We tap the insight gained from compliance assignments around the world, and use our up-to-date experience to cross-pollinate actionable insight from region to region.