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At NAFCU's urging, FASB proposes CECL delay
The Financial Accounting Standards Board (FASB) issued a NAFCU-sought proposal, which would delay the implementation date of the current expected credit loss (CECL) standard by an additional year, until 2023, for credit unions.
“We appreciate FASB considering credit unions’ concerns and moving forward with a delay of the CECL standard and committing itself to conducting a cost-benefit analysis to better understand this new standard’s impact on consumers, credit unions and the economy as a whole,” said NAFCU Chief Economist and Vice President of Research Curt Long.
“NAFCU will continue to advocate for credit unions to be exempt from this onerous and costly accounting standard as it could adversely affect credit unions’ capital levels immediately upon implementation. More so, credit unions did not cause or contribute to the financial crisis or the poor lending conditions that led the FASB to consider a new standard,” said Long.
The public comment period will remain open for 30 days, and NAFCU will submit comments. The association will also continue to push for credit unions to be exempt completely from this standard. While NAFCU will remain heavily engaged on this issue, the association recommends credit unions prepare to comply with the CECL standard.
The proposal would also delay several other standards, including hedging, leases and future major standards, by at least two years from their original effective dates for credit unions.
NAFCU has consistently communicated credit unions' concerns about the standard to FASB and has met with the NCUA to discuss implementation concerns and the agency's approach to CECL examination. The association is also active on Capitol Hill seeking relief for credit unions; NAFCU-backed "stop and study" bills have been introduced in the House and Senate.
NAFCU's Senior Counsel for Research and Policy Andrew Morris was in attendance at today’s FASB Board meeting.