Proposed policy statement on allowances for credit losses

The OCC, Federal Reserve, FDIC, and NCUA have published [84 FR 55510] in today's Federal Register a proposed interagency policy statement and request for comment on Allowances for Credit Losses. The statement describes the measurement of expected credit losses under the current expected credit losses (CECL) methodology and the accounting for impairment on available-for-sale (AFS) debt securities in accordance with FASB ASC Topic 326; supervisory expectations for designing, documenting, and validating expected credit loss estimation processes, including the internal controls over these processes; maintaining appropriate ACLs; the responsibilities of boards of directors and management; and examiner reviews of ACLs.

Comments on the proposed policy statement must be received by December 16, 2019.