Six months after the implementation of IFRS9, we ask Jeroen Van Doorsselaere, Wolters Kluwer’s finance, risk and reporting business, for his views on how well implementations have gone and what challenges remain
How well have IFRS 9 Financial Instruments implementations gone for the banks? Of course, this varies from bank to bank, but it’s safe to say many banks, no matter what approach was adopted, will be looking back at budgets that have run over, with plenty of challenges overlooked or underestimated.
Some banks started their implementation plans late and went for a ‘quick and dirty’ solution. They will now need to do a great deal to pass regulatory requirements and internal audits. European Banking Authority (EBA) short-term stress testing frameworks will contain requirements which include the IFRS 9 elements for calculations, arguably the next step in the IFRS 9 reporting journey.
There is also some aftercare needed by many banks to manage the business and make the necessary changes for actively managing the expected credit losses (ECL) or non-performing loans (NPL) of the contracts.
