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Source: United States House of Representatives – Representative Blaine Luetkemeyer (MO-03)

WASHINGTON, D.C. – Today, Congressman Blaine Luetkemeyer (MO-03) released the following statement regarding the extension of two critical CARES Act provisions in today’s COVID-19 relief package. The bill includes a delay in the capital requirements of the Current Expected Credit Loss (CECL) accounting standard and the suspension of Troubled Debt Restructuring (TDR) classifications until January 1, 2022.

“Extending the regulatory relief provided by the CARES Act, specifically the suspension of TDR classifications and CECL, is crucial to our economic recovery. In order for small businesses to fully recover, lenders must have the necessary flexibility to work with their customers without interference from regulators.  While larger forbearance efforts are needed, and CECL must be completely eliminated, the provisions in this bill will go a long way toward helping businesses get back on their feet,” said Luetkemeyer.   

Background: 

On July 31, 2020 Congressman Luetkemeyer introduced the bipartisan Financial Institutions Forbearance Act, which extends the TDR provision in the CARES Act and allows depository institutions to modify loans directly impacted by COVID-19 without being forced by regulators to classify the loans as impaired. 

Earlier this month, Congressman Luetkemeyer was joined by 35 Members of Congress in sending a letter urging Congressional leadership to extend the Troubled Debt Restructuring (TDR) provision included in the CARES Act to January 1, 2022 which was agreed to in today’s bill. The full letter can be found HERE. 

In May, Congressman Luetkemeyer led a bipartisan letter to Treasury Secretary Steve Mnuchin urging the Financial Stability Oversight Council (FSOC) to provide a complete moratorium on CECL until January 1, 2022. The full letter can be found HERE.

In July, Congressman Luetkemeyer introduced the Eliminating CECL Accounting Standard Act.

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