ATLANTA, Sept. 5, 2018 /PRNewswire/ -- Equifax, the
global information solutions company, unveils its SmartReserve™
offering to help SEC-registered banks and financial institutions
meet the new CECL (Current Expected Credit Loss) standards ahead of
the Q1 2020 deadline. The new regulation requires significant
changes to the data a bank maintains and analyzes, and involves a
much deeper level of modeling, analysis and reporting than what has
previously been required. SmartReserve is powered by Equifax Credit
Trends, which provides data to help support new CECL standards with
respect to customers accurately forecasting their reserves
based on this new modeling standard.
"This is new territory for many lenders as they may not
have the infrastructure to support these large amounts of data, and
mid-tier and smaller banks and credit unions and lenders may not
have the capacity to perform the modeling in-house," said
Amy Graybill, Vice President,
Enterprise Insights & Core Data Products, Equifax.
"SmartReserve provides the assistance lenders need to help protect
their business against non-compliance with new CECL standards,
along with historical pre and post-recession data that is needed to
accurately forecast future credit losses and calculate required
reserves."
Getting to Know CECL
Equifax SmartReserve has already provided customers with
information to help CECL forecasting by utilizing the extensive
data. The data has helped companies evaluate their expected loss
and tune their loss reserves. For small to mid-size financial
institutions that may need an outside resource to assist with
modeling requirements, Equifax and Moody's partner together in
delivering a comprehensive solution.
"This is a significant departure from current practices and is
understandably causing anxiety among both lending institutions and
auditors," said Cristian deRitis, Senior Director, Consumer Credit
Analytics at Moody's Analytics. "Switching to a measure of
potential lifetime loss will not only increase banks' allowances
for loan and lease losses (ALLL), it will dramatically change the
timing of those provisions. Whereas today a lender can use
the interest and principal payments collected early on in the life
of new loans to build capital in anticipation of defaults, under
CECL they'll need to add to their reserves before having collected
even $1 in loan payments. This could
change the economics of the transaction and lead to higher fees or
interest rates."
Additionally, SmartReserve uses the power of Equifax Credit
Trends logic to enable the linking of trades over time and
life-of-loan forecasting that includes 100 percent of the consumer
database where consumers have at least one trade along with key
consumer risk profile attributes at time of origination. The
offering also links trades over time to enable vintage curves,
updates and forecasting based on loan and consumer profiles to
facilitate critical life-of-the loan forecasting, along with
support from Equifax business intelligence and credit data
experts.
Please visit our Insights blog and follow us
on LinkedIn.
About Equifax
Equifax is a global information
solutions company that uses trusted unique data, innovative
analytics, technology and industry expertise to power organizations
and individuals around the world by transforming knowledge into
insights that help make more informed business and personal
decisions.
Headquartered in Atlanta, Ga., Equifax operates or has
investments in 24 countries in North America, Central
and South America, Europe and the Asia
Pacific region. It is a member of Standard & Poor's
(S&P) 500® Index, and its common stock is traded on the New
York Stock Exchange (NYSE) under the symbol EFX. Equifax employs
approximately 10,800 employees worldwide.
FOR MORE INFORMATION
Wyatt Jefferies
Sr. Director, Public Relations
404-617-8197
wyatt.jefferies@equifax.com
View original content with
multimedia:http://www.prnewswire.com/news-releases/equifax-helps-banks-become-cecl-compliant-with-smartreserve-300706616.html
SOURCE Equifax Inc.