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    Economic Scenarios for Current Expected Credit Loss (CECL) Model

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    FASB’s new CECL impairment standards require timely, forward-looking measurement of lifetime risk using “reasonable and supportable” forecasts. Moody’s Analytics produces defensible scenarios, based on sound economic theory and decades of observed historical econometric relationships, which can help clients address their CECL compliance. Our econometrically derived scenarios enable clients to assess lifetime credit losses under a range of differing assumptions.

    Use expertly developed scenarios with comprehensive, granular data

    • Baseline and consensus scenarios, plus eight alternatives with a 30-year horizon.
    • Derived from well-established macroeconomic forecasting methods.
    • Available for all US state and metro areas, plus more than 50 countries.
    • Coverage of more than 1,800 economic, financial, and demographic variables.
    • Fully documented model methodology; scenario assumptions published monthly.
    • Back-testing, tracking, and model validation report available.
    • Forecasts updated monthly, history updated in real time.

    Manage portfolio credit risk

    • Easily employ multiple, defensible scenarios that are based on CECL standards .
    • Better identify correlations between loss performance and economics.
    • Apply a comprehensive set of indicators beyond headline numbers.
    • Gain insight into specific risk factors, such as interest rate changes.
    • Access to detailed methodology and to our economists to support validation needs.
    • Seamlessly integrate scenarios across Moody’s Analytics services.
    • Choose from multiple delivery options to suit your needs.
    • Engage with Moody’s Analytics to create your own custom scenarios.
    Related Solutions

    Current Expected Credit Loss Model (CECL)

    Moody’s Analytics provides tools for the most crucial aspects of the expected loss impairment model, with robust solutions to aggregate data, calculate expected credit losses, and derive and report provisions.