NXTsoft Experiences Over 5x Increase in CECL Sales in 2021
NXtsoft sees uptick in CECL sales to financial institutions, recommends financial institutions adopt CECL now so that the CECL calculations can be run in parallel with their current allowance for loan loss (ALLL) calculations in advance of deadline.
BIRMINGHAM, Ala., Nov. 10, 2021 /PRNewswire-PRWeb/ -- NXTsoft (nxtsoft.com), a company focused on providing API connectivity, data analytics and data conversion solutions to financial institutions and Fintech companies, today announces a 5x increase in sales of their CECL solution during 2021.
CECL adoption was initially delayed due to U.S. government's coronavirus response, but the uptick in sales indicates to NXTsoft that financial institutions are on the pathway to compliance.
CECL is the new accounting standard that uses an "expected lifetime loss" measurement for the recognition of credit losses. No longer will it be sufficient or acceptable for financial institutions to book reserves as losses happen. Instead, they now must estimate, and book expected lifetime losses at the origination date of the loan. Most banks and credit unions must adopt CECL by January 2023 from the current allowance for loan and lease losses (ALLL method) and start reserving for loan losses based on the CECL calculations.
"It is recommended that financial institutions select their modeling methodology/vendor in the near future so that the CECL calculations can be run in parallel with their current allowance for loan loss (ALLL) calculations," said Dave Hynds, CECL product manager for NXTsoft. "By doing so, financial institutions will be able to predict the changes to their loan loss reserves required on December 31, 2022/January 1, 2023. This will be especially important for institutions making sizable reserve changes."
With NXTsoft's CECL solution, once the client settles on the initial settings, the NXTsoft staff prepares the formal narrative report for the quarter. NXTsoft delivers this quarterly report, consisting of 12-14 pages designed for sharing with regulators, auditors and boards of directors. NXTsoft's CECL report contains a narrative description of the CECL process and acceptable practices, as well as a description of the settings chosen by the financial institution and the results of the calculations.
"We have been using NXTsoft CECL services for approximately 2 ½ years. The implementation of this product was a smooth and easy process and didn't require much of my time being taken away from my everyday duties," said CaLea Matthews, compliance officer for Bank of Guydan, in Guydan, La. "Each quarter is the same simple process of completing the questionnaire and submitting the information. NXTsoft CECL services have saved me so much time and continue to do so each quarter," Matthews continued.
Matthews also said both that the First National Bankers Bank and the Federal Reserve have reviewed the CECL data from NXTsoft and that the institution has not received any negative feedback.
NXTsoft is currently offering banks and credit unions who wish to begin preparing for CECL now, a free CECL calculation report to demonstrate the company's capabilities and expertise. The free CECL report can be requested at https://info.nxtsoft.com/free-cecl-report.
About NXTsoft
NXTsoft is headquartered in Birmingham and has offices in Orlando, Atlanta, and Denver. NXTsoft is the market leader in secure, comprehensive, and complete workflow API connectivity, connecting fintech companies to banks and credit unions throughout the United States. NXTsoft's other solutions include data analytics, data management and data migration. NXTsoft's products and services help businesses secure, connect and optimize their data to maximize revenue opportunities, enhance profitability, and mitigate cybersecurity risk. For more information visit http://www.nxtsoft.com, email [email protected] or call 1-800-915-3381.
Media Contact
Karly Field, NXTsoft, 800-915-3381, [email protected]
SOURCE NXTsoft
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