CRE CECL Methodologies
The second in our CECL Quantification webinar series, this webinar discussed how commercial real estate (CRE) models and methodologies can be leveraged to fulfill CECL requirements, and key considerations in transitioning these models.
Implementation of the new financial instruments impairment standard (CECL), may take between twelve months to two years and over 62% of banks surveyed by Moody’s Analytics expect CECL compliance to increase their overall provisions.
Successful implementation requires understanding the impact of the accounting standard on provisions and identification of appropriate methodologies to incorporate the forward-looking information and life-of-loan horizon required for CECL.
Moody’s Analytics has designed a series of CECL Methodology webinars to help firms of all sizes with the tactical and strategic considerations when selecting the best modeling approach.
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Moody's Analytics Webinar: CECL – Adapting to AdoptJoin us as our experts, Chris Henkel, Senior Director, and Robby Holditch, Director, discuss critical steps in meeting the new CECL standard. |
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CECL: Adapting to AdoptOur subject matter experts, Chris Henkel, Senior Director, and Anna Krayn, Senior Director, discuss critical steps in meeting the new CECL standard. |
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Webinar-on-Demand
CECL: Adapting to AdoptOur subject matter experts, Chris Henkel, Senior Director, and Anna Krayn, Senior Director, discuss critical steps in meeting the new CECL standard. |
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Interview
What are the Major Differences with the New CECL Accounting Standard?In this video, Chris Henkel explains how the new CECL standard affects the measurement of expected credit losses and what institutions can do to prepare for implementation. |
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How Should Institutions be Preparing for CECL?In this video, Chris Henkel identifies the key factors institutions need to consider during the planning process and how to improve the measurement of credit risk over the lifetime of a loan. |
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What is CECL (Current Expected Credit Loss)?In this video, Chris Henkel from Moody’s Analytics provides a brief overview about the new accounting standard, Current Expected Credit Loss (CECL). Listen in to learn more about the implications and how institutions can prepare. |
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Rethinking Commercial Real Estate Credit RiskCommercial real estate (CRE) loans are seeing strong loan growth, combined with easing underwriting, resulting in increased credit risk. CRE mortgages often make up a significant part of a bank’s loan portfolio. In this webinar, we explore the keys to effective credit risk management for CRE. |
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Whitepaper
Estimating Commercial Real Estate (CRE) Stressed Loss Measures Under Federal Reserve 2017 Comprehensive Capital Analysis and Review (CCAR) ScenariosFor the 2017 CCAR program, the Federal Reserve published three macroeconomic and financial scenarios to be used in stress testing 34 CCAR financial institutions. In this study, we analyze 27 institutions, with a total of more than $760 billion in exposures to commercial real estate loans, using Moody's CMM Stress Testing framework. This report describes how we derive credit loss estimates for the CRE loan portfolios held by CCAR firms. This is our first study leveraging the loan-level commercial banks' data collected via Moody's Analytics CRE Credit Research Database (CRD™). Our analysis estimates that the expected nine-quarter, cumulative CRE portfolio loss through the first quarter of 2019 is 6.5% under the CCAR 2017 Severely Adverse Scenario. The primary factors behind the higher loss estimate compared to last year's stressed scenario (5.1% loss) is that this year's scenario features a slightly more severe economic downturn and a significantly larger decline in commercial real estate prices. |
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Presentation
CRE CECL Methodologies Webinar SlidesIn this presentation for the CECL Quantification webinar series, we discuss how commercial real estate (CRE) models and methodologies can be leveraged to fulfill CECL requirements, and key considerations in transitioning these models. |
