Fourth Global IFRS Banking Survey

The report captures the current views of 54 major banking groups'—including 14 global systemically important financial institutions (G-SIFIs)—on recent accounting and regulatory changes.

The report summarizes key findings such as:

·         Three years is most frequently cited as the necessary lead time for all phases of IFRS 9 Financial Instruments.

·         There is an increasing expectation that banks' pricing will be affected by the accounting change.

·         More than half of banks surveyed believe that the expected loss approach will result in banks' provisions increasing by up to 50% across all loan asset classes.

·         70% of banks surveyed anticipate their IFRS 9 expected loss provision to be higher than current regulatory expected loss. Capital planning uncertainty will continue, as regulators' responses to change are not yet known.

·         The key implementation challenges cited were resource constraints and coordinating multi-disciplinary effort including finance, credit, risk and IT.

·         56% of banks surveyed are concerned about credit data reconciliation and credit data quality.