Fifth Global IFRS Banking Survey

This fifth edition of the Global IFRS Banking survey focuses on the expected credit loss implementation challenges that banks will have to face and seeks to provide clients, regulators and the wider market with insights into current thinking across the sector.

The survey summarizes the responses of 59 of the world’s major banking groups, including 17 global systemically important financial institutions. Key findings include:

·         Most global banks estimate new IFRS 9 / FASB CECL rules on credit exposures will result in loan loss provisions increasing by up to 50% across asset classes.

·         Three-quarters of banks surveyed expect bank accounts to be more useful for regulators under the new rules.

·         Two-fifths of banks surveyed believe banking supervisors would be most influential in interpreting the new rules, with a third expecting auditors to be key.

·         Total anticipated implementation budgets have doubled in the year since our previous survey.

·         Three-fifths of banks think they do not have enough technical resources to deliver their IFRS 9 / FASB CECL project and a quarter of these further doubt that there will be sufficient skills available in the market to cover any shortfall.

·         85% of banks surveyed anticipate their expected credit loss provisions to exceed those calculated under Basel rules, mostly driven by the provision of lifetime expected losses under ‘stage II’.