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Managing CECL volatility: Insights into model validation, stress-testing and backtesting
September 12, 2024 @ 1:00 pm – 2:00 pm EDT
Current Expected Credit Losses (CECL) models generally represent high risk compared to lending institutions’ other models. Not only is the process of running the CECL estimate heavily data focused and involves many departments of the bank, volatility of the estimate over time has been present and oftentimes unexpected.
A comprehensive model validation will help you uncover the model mechanics behind the black box and the major triggers that create volatility. With this knowledge, stress-testing major assumptions can provide management teams with insight into future trends of the CECL estimate based on varying economic and operating environments. Additionally, back-testing will be a key focus going forward to ensure the model, data, and assumptions are working together properly to forecast a reasonable and supportable CECL reserve.
Join our webinar where our CECL specialists, Ivan Cilik and Sam Hoffman, will focus on the information your organization needs through lessons learned.
Learning objectives:
- Identify the key areas to focus on during a model validation
- Learn best practices around stress-testing procedures around major CECL assumptions
- Develop ways to back-test your model to align with historical behavior and forecast expectations
Information about CPE eligibility
There are no prerequisites for this webinar, and advance preparation is not required. There is no cost to attend this webinar. A certificate of completion will be emailed to you four to six weeks after the event.
- Level: Overview
- CPE credit: One (1) hour total credit
- Field of study: Specialized Knowledge
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