ADVISORY SERVICES · CECL COMPLIANCE
Estimate Allowance for Credit Losses with CECL FIT®
An outsourced CECL solution that helps community financial institutions comply with the CECL accounting standard. It provides an easier way to calculate the expected credit loss with transparent documentation and prepare for audits and exams, without putting extra strain on internal teams.
Executive Summary
CECL FIT by PCBB is a CECL compliance solution with an easy-to-use online platform with dedicated advisors to support community financial institutions with CECL modeling and audit preparation. Your institution retains full control over assumptions, data, and decisions.
How CECL FIT Works
Many tools leave teams to manage everything on their own. CECL FIT takes a different approach by combining a structured platform with ongoing advisor support.
Your institution makes the decisions, including which methods and assumptions are applied. PCBB provides the structure and guidance to help you move through the process, provides insights into implications of your decisions, and works with your team to prepare for audits and regulatory exams, without adding unnecessary complexity.
Why Banker’s Trust PCBB
PCBB is an FDIC-insured correspondent bank that operates under many of the same regulatory expectations as the community financial institutions it serves.
CECL FIT was designed specifically for community financial institutions, with that operating reality in mind.
CECL FIT Platform
CECL FIT operates on a secure, web-based CECL platform that requires no software installation and works with any core system without direct integration. It supports the full workflow from data entry through reporting, without adding unnecessary complexity or learning curves:
Advisor Support
CECL FIT includes dedicated advisor support that works alongside your team throughout the process. This goes beyond a typical help desk. Advisors provide guidance during setup and continue to assist and support your team through ongoing reporting and audit preparation.
- Online platform, no software to install, with no required core integration
- User-friendly dashboard with summary views, and drill-down capabilities into detailed loan or segment data
- What-if modeling for future-focused analysis across portfolios
- Q Factor decisioning with embedded, government-sourced data to support documentation
- Forward-looking capabilities to support forecast of future losses
- Transparent reporting provides defendable documentation for auditors, regulators, Board of Directors, and management
- Supports loans, unfunded commitments, and held-to-maturity (HTM) securities
- Dedicated CECL advisors with extensive banking, regulatory, and accounting knowledge
- Available throughout the entire relationship to support your needs
- Will speak directly to auditors and examiners on your institution’s behalf
- Decades of combined banking, accounting, and risk management experience
- Personalized education and training for staff and board
CECL FIT Aligns with Bay State Bank’s Growth-Oriented Vision
Challenge: As Bay State Bank expanded, it needed a CECL partner that could not only meet regulatory demands but also support its growth-oriented vision.
Results achieved: Met regulatory expectations with a more future-ready CECL solution and alleviated internal time to focus on strategic growth rather than model development.
See how CECL FIT supported Bay State Bank’s growth and evolving loan portfolio needs.
Qualitative Factors and Forward-Looking Forecasts
With CECL FIT, Q Factors can be adjusted across different parts of the portfolio, whether that’s by segment or risk grade. That flexibility makes it easier to reflect both current conditions and potential future changes over time.
External data is also available for forward-looking forecasts to estimate future credit losses and how they may differ from historical losses.
Your team keeps control over all Q Factor adjustments, forward-look forecasts, and assumptions. The CECL platform helps capture those decisions so reporting stays consistent over time.
Transparent Reporting
CECL FIT creates clear, detailed reports for auditors, regulators, board members, and management. The intuitive layout highlights the most valuable insights without requiring manual interpretation. It means you have strong documentation and can easily review your assumptions that you’ve made to generate this forecast.
Drill-down capability allows users to move from a high-level summary into the underlying detail at the loan, segment, or portfolio level. This makes it straightforward to trace a number back to its source when questions come up during review.
All reports can be exported and are formatted for auditor and management review, so there is no manual reformatting required before they are shared internally or externally.
Highlights
- Clear, detailed reports
- Drill-down to source data
- Exportable, audit-ready format
- Strong documentation
- Easy review of assumptions
I would dread the first of the month, when everyone would ask, ‘when will the reserve figures be released?’ With CECL FIT, all I have to do is pull some reports and send them off. It’s a lot less work, making the process much more efficient, and automated.
How Harleysville Bank Improved Efficiency with CECL FIT
Challenge: Harleysville Bank faced a labor-intensive CECL process that consumed valuable staff time and delayed monthly reporting. To improve efficiency and consistency, the bank needed a more streamlined, efficient approach.
Results achieved: Reduced operational burden, the platform allowed for scenario analysis and adjustments to future market conditions, enhancing strategic planning. Harleysville Bank reported that they saved 1 full-time employee day each month, equivalent to 12 days a year.
Harleysville Bank’s experience shows how automation and expert support can transform CECL from a time-consuming burden into a manageable process.
Getting Audit and Exam-Ready with PCBB
Getting ready for audits and regulatory exams involves more than just running the numbers. Teams still need to explain how decisions were made and provide documentation to support those choices. When this work is reviewed, auditors usually look at how the pieces connect, from methodology selection to how assumptions are being used and whether the data stays consistent over time.
Our transparent reporting helps you clearly show how those pieces fit together. It documents how your methodology was selected, how assumptions flow through the forecast, and how results remain consistent over time, so stakeholders can see exactly how you arrived at your CECL estimates.
CECL FIT Advisors work alongside your team as you prepare for audits and exams. They help review documentation, discuss assumptions, and ensure you are prepared for questions before an audit or exam, so you can walk into reviews with confidence.
Highlights
- Audit and exam-ready framework
- Clear linkage from methods to results
- Strong, consistent documentation
- Support for explaining assumptions
- Advisors to prep for questions
As a former FDIC regulator and bank examiner, I bring a unique perspective to Bay State Bank. My extensive experience with larger banks’ CECL implementations has allowed our institution not only to comply with regulations but also to derive meaningful value from the process.
In-House vs. Outsourced CECL
Financial institutions manage CECL compliance in different ways. Some maintain the process internally, while others choose an outsourced solution like CECL FIT. The right path usually depends on internal capacity, portfolio complexity, and the availability of staff time for modeling and ongoing maintenance.
Handling CECL In-House
- Build and maintain models internally
- Manage data inputs and consistency
- Prepare reports and support documentation for audits and exams
- Allocate staff time for updates and reviews
- Internal expertise required
Outsourcing FIT
- Structured modeling workflow
- Methods that work with your loan portfolio and loan groups
- Capabilities address Q Factor, Forward Look and loan grouping
- Advisor support throughout the process, including exam and audits
- Defensible reporting and note level detail built-in
- Your team retains control over assumptions
Why Switch from In-house to Outsourcing CECL?
Michael Kerr, CCO of First Federal Bank, was initially determined to handle CECL compliance in-house. As his team got further in the process, he decided it was best to outsource instead.
“We were going to do CECL in-house, using SCALE, but we had concerns about the approach for our bank. We turned to PCBB’s Advisory Services team, who have the ability, expertise, and access to the data needed to support and defend our qualitative factors and methodologies.
“I just reported to our board last month that we are now fully implemented with CECL, thanks to PCBB’s help.”
CECL FIT Options
To meet different needs and loan portfolio complexity, CECL FIT offers three tiers. Each tier provides a balanced range of services and supports your team’s needs. Plus, with our Right FIT Promise, you can switch levels in the future, as your needs change.
Basic Tier
For institutions with simpler portfolios, wanting a self-serve approach.
- WARM method only
- Your team inputs data
- Core-agnostic, works with any core system
- Loan grouping, Q Factors, Forward Look and transparent reporting
- Advisor guidance as needed
- Operational support
Deluxe Tier
The most popular tier and supports a broader range of CECL needs.
- Supports up to three CECL methods
- Optional assistance with uploading data from PCBB
- Core-agnostic, works with any core system
- Adds note-level detail capabilities
- Supports held-to-maturity securities (HTM) with specific methods
- Operational + implementation support included
- Expanded support for audit and exam preparation
Pro Tier
For institutions with more complex portfolios or needing more in-depth support.
- Includes all Deluxe features plus:
- Access to all supported CECL methods
- Additional guidance for documentation and review processes
- Supports held-to-maturity securities (HTM)
- Operational + implementation support included
- Expanded audit and exam preparation support
Footnote Pricing depends on your asset size. Contact us for your specific pricing.
The Right FIT Promise
Move between tiers as your portfolio grows or your internal resources change. No penalties.
Want more details on the CECL FIT tiers?
See How CECL FIT Works for De Novo and Smaller Banks
Challenge: Icon Business Bank needed a better way to address CECL challenges common to newer and growing banks, including limited data, tight resources, and high regulatory expectations.
Results Achieved: By automating many manual CECL calculation tasks, the team significantly reduced time and effort required, so they could focus on other critical tasks and helped them create stronger documentation.
Hear What Our Customers Are Saying About CECL FIT
Institutions that use CECL FIT count on both the platform and advisor support to manage ongoing compliance and preparation.
Some of the benefits were the templates that are being provided, which are a huge help, whether it’s the qualitative factors or the data to back up the historical loss data, such as all the call report stuff that goes back to 2000. That’s tremendously helpful.
Every time we had questions, we got answers immediately. More than anything, it was the accessibility of your team at PCBB, answering our questions and being very helpful.
The support that your team provides during the audit or exam process is really great. It’s above par because we’re able to collaborate with you to provide nuanced, detailed reports, and you have also offered to speak with the auditors or examiners as well.
Frequently Asked Questions About CECL and CECL FIT
Answers to some of the most frequently asked questions about the accounting standard Current Expected Credit Loss (CECL)
About the CECL Standard
CECL is an accounting standard that requires financial institutions to estimate credit losses over the life of a loan, rather than when the loss was incurred. It replaced the incurred-loss model by incorporating current conditions and future factors into the calculation.
FASB, including various stakeholders, determined that the incurred-loss standard delays the recognition of credit losses and overstates assets. CECL takes a more forward-looking approach by factoring in expected conditions, enabling institutions to recognize potential losses earlier and better understand risk.
CECL rolled out in phases. Public SEC filers adopted it first, while most other financial institutions followed by 2023. At this point, the standard is in place across the industry.
The method you choose usually comes down to your portfolio and the data you are working with. Many institutions utilize multiple methods, including WARM, Discounted Cash Flow (DCF), Average charge-off or others, based on their loan characteristics.
Yes, the WARM method is widely used, especially for portfolios that are more stable and not extraordinarily complex. Whether it makes sense depends on the data you have and how your portfolio is structured.
Qualitative Factors are used to adjust baseline loss estimates when current or expected conditions are not fully reflected in historical data. They can include global economic trends; business conditions; the nature and volume of loan terms or portfolio; concentrations of credit, among others. These adjustments can be applied across different parts of the portfolio and need to be clearly documented.
About the CECL FIT Platform
Auditors are responsible for evaluating the reasonableness of an institution’s CECL estimate, ensuring it provides a fair and accurate representation of the entity’s credit risk. When auditors review CECL, they focus on how your approach works in practice, how the methodology was chosen, how assumptions are used, whether the data supports the results, how Qualitative Factors are applied, and whether the process remains consistent over time.
CECL FIT does not need a direct link to your core system, so we are core-agnostic. Instead, you download data from your core and upload data into CECL FIT platform. This saves you from paying expensive integration costs with your core provider.
The methods offered by CECL FIT vary by tier. This allows institutions flexibility to select methods that align with their portfolio and reporting practices.
Yes, CECL FIT can be used for held-to-maturity securities within the appropriate tiers, allowing institutions to include those assets in their overall process.
Yes, we offer the Right FIT Promise allowing institutions to move between tiers as their needs change without any penalties. This flexibility enables teams to modify their level of support and platform access over time and always have the right fit.
PCBB has a Statement of Controls (SOC) attestation covering its data center and proprietary applications, including CECL FIT, to support data security and operational controls.
Depending on the Tier you choose, Advisors are engaged from setup to implementation through reporting and continue to assist your team with audits, reviews, or exams.
Yes, we have customers that routinely decide that they want to shift from their manual internal CECL process to our CECL FIT platform, lessening internal workload while ensuring control over assumptions and final reporting.
Ready to See CECL FIT in Action?
Schedule a demo or request a quote to see how CECL FIT can help your institution with compliance. Review the platform, explore which CECL FIT tier fits your needs, and see how advisor support works in practice.
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