The NCUA has released the latest update to its Simplified CECL Tool which includes new life-of-loan –or Weighted Average Remaining Maturity — factors. The tool also includes specific refinements for unsecured credit card loans, payday alternative loans, and leases receivable.

According to the NCUA, the update is designed for credit unions currently using the Simplified CECL Tool to calculate their credit loss expense, or provision for credit losses, for the period ending September 30, 2024.

The Simplified CECL Tool was developed to assist small and non-complex credit unions in estimating allowances for credit losses on loans and leases. Credit unions with assets under $10 million are encouraged to consider using the tool, which offers a more accurate method for measuring credit losses and provides valuable insights for loan portfolio management.

To access the latest version of the Simplified CECL Tool, visit the NCUA’s Simplified CECL Tool page and click “Download the Latest Simplified CECL Tool.” For further guidance, users can review the Frequently Asked Questions, the User Guide, and the Model Development Document available on the same page.