Members of Congress Urge Delay of (CECL) Accounting Standard Implementation
WASHINGTON, DC – Congressman Roger Williams (TX-25) today joined with Congressman Vicente Gonzalez (TX-15) in authoring a bipartisan letter to Securities and Exchange Commission (SEC) Chairman Jay Clayton urging him to delay the implementation of the Current Expected Credit Loss (CECL) accounting standard.
“I have tremendous concern with this new accounting standard and the far-reaching effects it will have on the local Texas economy, banks and consumers,” said Congressman Roger Williams. “Both Republicans and Democrats agree, we need to take the time to fully understand the implications of such a drastic accounting change before we proceed. I urge the SEC to hold on implementation until our concerns are addressed and there is a proven path forward.”
This effort has the support of both the American Bankers Association and the Independent Bankers Association of Texas, highlighting the importance of CECL implementation on both the national and local Texas economies.
The letter, signed by 21 Republican and 4 Democrat Members of Congress, warns against the unintended consequences of this new accounting standard, and poses five questions the SEC should consider before moving forward.
“The implementation of the CECL accounting standard has far reaching consequences for many industries. Although our primary concerns relate to the impact on independent and community banks, I also worry about how implementation will affect trade and the insurance industry to name a few. I believe that a one-year delay is not too much to ask while we obtain additional information about possible unintended consequences in the marketplace.” – Congressman Vicente Gonzalez
“We are gratified that Rep. Williams and Rep. Gonzalez and so many lawmakers from both sides of the aisle share our concern about the potential impact the CECL accounting standard could have on banks, the customers they serve and the broader economy. We agree that the right answer for FASB is to delay CECL implementation until a Quantitative Impact Statement can be completed that fully assesses the repercussions of this significant accounting change. As the lawmakers’ letter makes clear, hitting pause right now is in the public interest, and we hope the SEC and FASB will recognize that.” – The American Bankers Association
“We strongly support any initiative to fully understand and further vet the potential impact of the significant changes proposed by FASB related to CECL. We have expressed our concerns multiple times that CECL is a ‘solution in search of a problem’ in the community banking space, and the additional ‘hoops’ required are counterproductive and inappropriate for the community bank model. We applaud Congressmen Vicente Gonzalez and Roger Williams for their bipartisan effort to delay the implementation of this significant change and study the impact of this proposal on all sectors of the banking industry, as well as our citizenry, businesses and the American economy.” – The Independent Bankers Association of Texas
To view the letter click here.