Is there adequate loan loss provisions for banks ? –Study of IFRS 9
碩士 === 國立交通大學 === 管理學院財務金融學程 === 104 === The International Accounting Standards Board (IASB) has published the final version of IFRS 9 Financial Instruments in July 2014. IFRS 9 , based on an forward-looking expected credit loss model and replace the IAS 39 Financial Instruments. It is is effective...
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| Format: | Others |
| Language: | zh-TW |
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2016
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| Online Access: | http://ndltd.ncl.edu.tw/handle/6d9zyb |
| Summary: | 碩士 === 國立交通大學 === 管理學院財務金融學程 === 104 === The International Accounting Standards Board (IASB) has published the final version of IFRS 9 Financial Instruments in July 2014. IFRS 9 , based on an forward-looking expected credit loss model and replace the IAS 39 Financial Instruments. It is is effective for periods beginning on or after 1 January 2018.
Expected credit loss model that will result in more timely recognition of loan losses. Entities are required to recognize an allowance for either 12-month or lifetime expected credit losses (ECLs), depending on whether there has been a significant increase in credit risk since initial recognition.
This paper focuses on how expected credit loss model effect the loan loss provision for banks in Taiwan. Whether the new standards require larger loss provisions for banks or not? Empirical results show that during recession, expected credit loss increases steeply. Loan loss provisions can not cover the expected loss. In such situation, bank’s earnings will be affected.
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