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April 2021

Allowances for Credit Losses

This publication is part of:

Collection: Comptroller's Handbook

Series: Safety and Soundness

Category: Asset Quality


The booklet provides information regarding allowances for credit losses. It describes the scope of the current expected credit losses (CECL) methodology, risks associated with allowances for credit losses, and seven primary components used to estimate allowances for credit losses.


This booklet applies to the OCC’s supervision of banks that have adopted the CECL methodology under Accounting Standards Codification Topic 326. The “Allowance for Loan and Lease Losses” booklet of the Comptroller’s Handbook continues to apply to the OCC’s supervision of banks that have not adopted CECL.