For Immediate Release
January 13, 2016
ABA Media Contact: Blair Bernstein
(202) 663-5468
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ABA’s Nichols Calls for Clarity on Upcoming CECL Model

WASHINGTON — Rob Nichols, president and CEO of the American Bankers Association, addressed specific concerns regarding the Financial Standards Accounting Board’s Current Expected Credit Loss (CECL) impairment model in a letter sent to FASB Chairman Russell Golden today. The model, in its current form, represents the biggest change in the history of bank accounting.

In the letter​, Nichols calls for public answers to a series of questions about CECL, including the feasibility of its implementation and if the model’s benefits truly outweigh its costs given the unreliability of long-term economic forecasts. 

“ABA remains extremely concerned about whether and how banks can implement CECL and whether it will result in an improvement in the accounting for credit impairment,” Nichols said. “We believe there is still time for the FASB to consider some of these significant issues.” 

Nichols also expressed worry about the burden CECL presents for community banks.

“We believe the goal of scalability is linked to simplicity, which is extremely important both for banks and users of their financial statements. However, it is difficult to see how most community banks can implement a non-complex CECL model that will pass audit or examination muster in this environment,” said Nichols. 

Despite his concerns with the current standard, Nichols thanked the FASB for its continued collaboration with ABA to develop an improved credit impairment model. 

“This is an extremely complex and difficult issue, and we appreciate your continued time and consideration of our bankers’ views.  Our goal is to continue our dialogue in order to ensure that the impairment model is acceptable and workable for all sizes of banks and their financial statement users.”

For ABA’s discussion paper on CECL implementation challenges, visit ​ 

The American Bankers Association is the voice of the nation’s $16 trillion banking industry, which is composed of small, regional and large banks that together employ more than 2 million people, safeguard $12 trillion in deposits and extend more than $8 trillion in loans.

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