Summary:

The federal financial institution regulatory agencies have issued a Joint Statement on the New Accounting Standard on Financial Instruments – Credit Losses regarding the Financial Accounting Standards Board's new standard, which introduces the current expected credit losses methodology (CECL) for estimating allowances for credit losses. The joint statement also provides initial supervisory views regarding the implementation of the new accounting standard.

Statement of Applicability to Institutions under $1 Billion in Total Assets: This Financial Institution Letter applies to all FDIC-supervised banks and savings associations, including community institutions.