TDRs and ALLs
November 13th, 2012 9:00 AM – 4:00 PM
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Learn to identify, understand, calculate and evaluate Troubled Debt Restructurings (TDR) and and Allowances for Loan Losses (ALL) from one of CUNA's Strategic Service providers.
Troubled Debt Restructurings
Earlier this year, the NCUA issued new guidance reshaping the ways in which Troubled Debt Restructurings (TDRs) are identified, tracked and reported on and the documentation required by credit unions governing these loans.
This session will give attendees an understanding of how to identify a TDR under the new rules, navigate the new NCUA requirements and give real world examples of ways to streamline your TDR reporting. The session will cover the following topics:
- Why troubled debts are restructured and how to identify a TDR
- Calculating TDR impairment
- New NCUA TDR guidance and the effect on your reporting
- Walkthrough of drafting a TDR policy, with the objective being that you have a unique completed policy to take back to your credit union.
- How to more efficiently track these loans in your system
- Practical considerations to evaluating member qualifications and evaluating effectiveness of the program at your credit union.
Calculating, Understanding, and Evaluating the Allowance for Loan Losses
One of the most common NCUA concerns resulting from the examination process surrounds the allowance for loan losses. Your calculation may be accurate, but without appropriate methodologies and documentation supporting how you arrived at your reserve, including qualitative factors influencing next year’s charge offs, the NCUA tends to take a conservative approach in evaluating adequacy.
This training session will leave attendees with an understanding of the allowance for loan losses and how changes in the economy, collateral markets and strategies at your credit union can affect charge offs. This session should be beneficial to both those directly involved with the allowance calculation and those simply trying to gain a better understanding of what to look for in evaluating adequacy. Topics to be covered:
- Purpose of the Allowance for Loan Losses
- Why historical charge offs are only the starting point; learn how internal and external changes can affect future losses at your credit union
- How to quantify qualitative factors
- Reserves for loans individually identified as impaired
- New required financial statement disclosures
- Examples of industry identified best practices
- Tips for satisfying NCUA examiners and financial statement auditors
Dan Price is a Certified Public Accountant who began his career as a financial statement auditor. He is currently a manager and senior analyst at Twenty Twenty Analytics. He received his Bachelors of Science Degree in Accounting and Masters of Accountancy from the University of South Florida in Tampa, Florida.
His experience as a financial statement auditor has given him an understanding of what auditors and examiners look for in their evaluation of the allowance for loan losses. As an analyst at Twenty Twenty, he develops loan portfolio risk models for credit unions, which include the assessment of the risks present when a troubled debt is restructured. Utilizing the results of these models and incorporating changes in the local economy and real estate markets, he has independently evaluated the adequacy of hundreds of allowance calculations.
He stays current on NCUA regulations and FASB standards to determine how they affect the design of risk models and reporting requirements for credit unions. He is the author of the Twenty Twenty Blog which discusses credit union standards, trends and hot topics. He was also published in the Credit Union Times discussing troubled debt restructurings and presented on the topic at the MDDCCUA’s 2012 Annual Meeting and CUNA's Center for Professional Development.
Who should attend
All credit union professionals with lending responsibility.
8:30 a.m. - Signing in, networking, light breakfast
9 a.m. to 4 p.m. - Training
Lunch will be provided.
Maryland and D.C.-based credit unions $75 million and under in assets may be eligible for a 75% educational reimbursement from the Credit Union Foundation of MD & DC. For details and an application, visit http://www.cufound.org/training.htm
8975 Guilford Road
Columbia, MD 21046
November 13th, 2012 9:00 AM – 4:00 PM