The Basel Committee is supporting the proposal for adoption of an “expected loss” based measure of provisioning which captures actual losses more transparently and is also less procyclical than the current “incurred loss” approach. The expected loss approach for provisioning will make financial reporting more useful for all stakeholders, including regulators and supervisors. Disclosure requirements 21.
The committee includes senior bank supervisors from the Board and relevant Reserve Banks as well as senior Federal Reserve staff from the research, legal, and other divisions at the Board and from the markets and payment systems groups at the Federal Reserve Bank of New York.