Long before the coronavirus pandemic upended the economy, bankers warned that sweeping new accounting rules forcing them to book losses before they happened would create chaos in an economic downturn and dry up lending when customers needed money the most.
Their warnings seemed dire and perhaps hyperbolic. Then came Covid-19. As the virus spreads, so too do the calls to delay the current expected credit losses (commonly called CECL) standard, alter it, or make bank regulators intervene.
“This is everything everyone was worried about,” said Michael Fadil, chief risk officer at Home Diversification Corp.and former vice ...