CECL

CECL Solution

MIAC’s CECL software solution provides your financial institution with an automated process for determining your expected losses and satisfying GAAP/regulatory requirements. MIAC’s modeled estimates of future credit losses and forecasts are relied upon throughout our industry, the accounting profession, and across multiple government agencies.
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Transitioning to CECL

MIAC employs industry standards for model development and CECL, which have been chosen by leading participants including lenders, banks, accountants, and regulatory bodies. CECL outcomes are projected using macro factor forecast scenarios and MIAC’s family of behavioral models. MIAC’s powerful analytical tools perform CECL forecasting of the loss allowance for all types of financial assets, segmented into cohorts with similar attributes. Our CECL tools can also be used for ALM and DFAST/CCAR.

 

 

Cash Flow Modeling Tools

Model performing and non-performing assets, with built-in models responsive to both loan characteristics and macro factors data for all loan asset types.

Portfolio Segmentation

Segmentation of loan, lease, and debt portfolios into identifiable portions with similar and discrete characteristics.

Methodology

CECL is flexible and not prescriptive. Modeling methods can include Migration Analysis, Vintage Analysis, POD / LGD, and Loss-Rate history.

Model Validation

Our models have been used by internal, external, and regulator validators – includes significance tables and backtesting results.

Stress Testing

Understand how portfolio losses will behave as the economy changes, and report on key portfolio risks.

Loss Scenarios

Compare CECL scenarios, use alternative methodologies/models or scenarios, and weigh them.

Modeling for Expected Losses

MIAC has been modeling expected credit losses for loan valuations since our formation. MIAC can model all loan types and has supporting databases. Our toolkit of software solutions can be used to deploy regulator-approved CECL modeling solutions.
These alternatives encompass both cash flows based and non-cash flows based regulator-sanctioned methodologies.

Portfolio-Specific Models

MIAC’s behavioral modeling team can create custom models tailored to your specific portfolios and local circumstances.
MIAC can implement regulator-sanctioned tools and provide documentation on:
  • Macro factor scenarios creation
  • Model validation

CECL Methods Comparison

MIAC’s tools allow for the setup and comparison of different CECL methods.
The models menu allows you to select a modeling method, populate the needed data either by a paste-in, manually, or extracted from loaded data.
  • All models have similar primary displays for simplicity
  • Input or data summary information above

On-Demand Webinar

Planning and Implementation
FASB’s revised methodology formalizes the forecasting of expected credit losses on loan assets and prescribes best practices. MIAC has been modeling expected credit losses for loan valuations since our formation.
Access the Webinar Materials

Methodologies for CECL

Which CECL Model is Right For You?
MIAC’s methodology for forecasting current expected credit loss is consistent with industry best practices as prescribed by FASB and the joint regulatory guidance. Our analytical tools have been developed internally, and constantly enhanced, for compliance with the recommended approaches. Access our FREE guide now.
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CECL Insights

Knowledge Base, Whitepapers, News & More