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Current Expected Credit Loss (CECL) Solutions
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ProfitStars ​CECL Analysis and Reporting℠

CECL Compliance Modeling with Loss Projections Down to the Instrument Level

ProfitStars CECL Analysis and Reporting is a hosted solution that not only helps you meet Current Expected Credit Loss (CECL) requirements, but adds business value with data that supports your financial institution's strategic goals.

The Financial Accounting Standards Board (FASB) requires that financial institutions account for Current Expected Credit Loss (CECL). There are several different approaches for projecting losses, and all methodologies should provide information about pool level and total portfolio level of expected losses. 

ProfitStars CECL Analysis and Reporting includes both a robust probability of default (PD) model (also referred to as a discrete time survival model), as well as a time series model. Access to two models provides a “second opinion” on your CECL results to give you multiple views of your credit risk. 

This detailed output delivers far more business value than just the basic CECL regulatory requirements. Expected loss and expected prepayment estimates can be integrated with all of the following functions: 

  • Loan Pricing
  • Customer Profitability 
  • Budgeting 
  • Asset-Liability Management

ProfitStars CECL Enhanced ModelingTM

ProfitStars CECL Enhanced Modeling takes your CECL results to the next level by incorporating your custom forecasts with origination scenarios to better understand your CECL reserve needs. Enhanced Modeling provides

  • Custom economic forecasts that are unique for your institution and economic environment.
  • Simulated origination scenarios based on changing volumes to gain a better understanding of reserve implications.
  • Segmented CECL results that help you better understand and manage your portfolio.​ 

What It Does

  • Models loss projections for CECL requirements 
  • Offers both probability of default and time series models 
  • Enables the integration of estimates with loan pricing, customer profitability, budgeting, and ALM 
  • Provides annual back-testing of models 
  • Provides loss-rate forecasting 
  • Offers change reports based on different timeframes 
  • Offers a secure, cloud-based platform

What It Does For Me

  • Increases confidence in the accuracy of projections 
  • Increases ability to successfully meet compliance standards
  • Provides valuable business intelligence for decision making 
  • Reduces expenses for capital expenditures and hardware/software maintenance