Small Banks Relieved, Confused Over Loan Loss Accounting Delay

The financial team at Pacific Mercantile Bancorp was “locked and loaded” to implement at the stroke of 2020 the biggest change to bank accounting in decades.

Then, less than five months before the new accounting rules are going live for major financial institutions, the Costa Mesa, Calif. bank learned it could get a three-year reprieve.

“For us, it’s a little bit disappointing because we were ready and we put a lot of time and energy into getting ready,” Curt Christianssen, CFO of the seven-branch bank, said of the current expected credit losses (CECL) accounting standard.

Still, if the ...