Modeling a Path to CECL for Community Banks

From Credit Risk analysts to modelers, the credit oversight functions at community banks under $1 billion in assets are working to enhance CECL reserve methodologies and modeling approaches before January 2023. That’s when they must officially use the latest accounting standards that recognize expected loan losses over the maturity of a loan.

To understand the state of CECL adoption at community banks, the RMA Model Validation team developed the Community Bank CE…