Reserve Bank of India proposes lenders to adopt expected loss-based approach for loan loss provisioning

"The inadequacy of the incurred loss approach for provisioning by banks and its procyclicality, which amplified the downturn following the financial crisis of 2007-09, has been extensively documented. One of the major elements of the global response to these findings have been a shift to expected credit loss (ECL) regime for provisioning," the central bank said in the statement on developmental and regulatory policies.

from Banking/Finance-Industry-Economic Times https://ift.tt/nM80W7j