As economic conditions worsened in 2008 and Fannie/Freddie stock lost value (prior to the government's takeover), ABA began work on problems associated with applying fair value accounting in a tumultuous economic environment. ABA organized conference calls with bankers and the chief accountants at bank regulatory agencies to discuss "other than temporary impairment," including how OTTI relates to trust preferred securities and certain perpetual preferred stock.

In testimony, letters and countless meetings with regulatory officials, ABA has argued for changes to FASB's fair value standard and auditors' application of it. ABA continues to take the lead on this issue, and recently persuaded FASB to address some of the distortions created by its OTTI rules.

• ABA Letter on G20 Accounting Recommendations -- 6/24/10
• FASB Staff Position on OTTI -- 1/12/09
• FASB Finalizes OTTI Proposal – ABA Newsbytes Special Edition, 1/07/09 
• ABA Sample Banker Letter to FASB on OTTI Proposal -- 12/29/08
• ABA Comment Letter on FASB OTTI Proposal -- 12/28/08 
• FASB Issues First of Two Proposed Staff Positions to Improve the Financial Reporting for Financial Instruments -- 12/22/08 
• ABA NewsBytes Special Edition:
  FASB Responds to ABA's Request for Fair Value Guidance – 10/03/08 
• ABA NewsBytes Special Edition:
  SEC Answers ABA Request for Guidance on Fair Value Issues – 9/30/08 
• ABA Suggests Some Solutions for Fair Value Accounting Problems – 9/23/08
• ABA letter to Congress on Economic Stabilization package and impact of fair value accounting – 9/22/08
• ABA letter to regulators recommending fixes to GSE bailout plan – 9/18/08
• ABA paper on OTTI, sent to SEC, PCAOB and accounting firms – 9/11/08
•   ABA member bank conference call with bank regulators on Fannie/Freddie takeover  (Audio 53 min) – 9/10/08

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For more information, contact ABA's Donna Fisher.