News & Events

Managing Profitability Under CECL Through Loan Pricing (Part 2)

BY BEN MURRELL, FI CONSULTING Part 2: Applying the Conceptual Loan Pricing Framework to CECL As organizations implement CECL, a key question is how CECL estimates should factor into loan origination and pricing decisions. In Part 1 of this series, we illustrated the mechanics of pricing with a hypothetical loan. In Part 2, we use......

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Managing Profitability Under CECL Through Loan Pricing (Part 1)

BY BEN MURRELL, FI CONSULTING Part 1: Defining a Conceptual Framework for Loan Pricing Background As organizations implement CECL, a key question is how CECL estimates should factor into loan origination and pricing decisions. Linkage is important because CECL will require that expected losses be reserved at time of origination. Correctly pricing in new reserves......

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In Depth

Under the Hood of New…

Some aid is on the way, but ‘foreclosure forensics’ might make it...

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A Mortgage Modeler Offers Subprime…

Trying to answer the question: How did so many financial analysts miss...

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Tracing the Trail of Relief

Negative equity, valuation methods play key roles in determining which troubled borrowers...

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Are We Ready for a…

New measures move beyond sales-based data By James R. Follain, Ph.D., and Barbara...

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Blog

White Paper: Four Pitfalls to Avoid During CECL Implementation

BY MARK JORDAN, FI CONSULTING Building a durable, defensible Current Expected Credit Loss (CECL) process that reflects your organization’s view of its credit risk requires painstaking focus on the fundamentals of building and defending your bank’s own view of its risk exposure. This requires bringing a disciplined and methodical approach to building the “case” for......

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A Framework for Multiple Economic Scenarios Under CECL

BY ROBERT CHANG AND MARK JORDAN, FI CONSULTING Background We present a pragmatic approach to generating multiple economic scenarios for the new FASB current expected credit loss (CECL) accounting standard. While the guidance does not explicitly mention the number of scenarios that should be used when measuring expected credit losses, financial institutions should consider a......

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