Missouri Code of State Regulations
Title 20 - DEPARTMENT OF COMMERCE AND INSURANCE
Division 1100 - Division of Credit Unions
Chapter 2 - State-Chartered Credit Unions
Section 20 CSR 1100-2.055 - Allowance for Loan Loss
Current through Register Vol. 49, No. 6, March 15, 2024
PURPOSE: This rule sets forth certain provisions regarding the establishment and maintenance of the allowance for loan loss account in conformity with generally accepted accounting principles.
(1) All credit unions shall maintain an allowance for loan loss account. Credit unions that have not in the past considered inherent losses in establishing the balance in this account may transfer the initial amount applicable to inherent losses from the regular reserve or undivided earnings.
(2) The allowance for loan loss account shall represent an estimate of loan losses in the entire loan portfolio, including estimated inherent losses, in conformity with generally accepted accounting principles and meet regulatory requirements for full and fair disclosure. The allowance account will be adjusted at least quarterly or more often as required. All adjustments to increase or decrease the allowance account will be made to the provision for loan loss expense. All charged off loans and recoveries will be to the allowance account.
(3) Full and complete documentation of the determination of the balance of the allowance account must be maintained by the credit union.
*Original authority: 370.100, RSMo 1939, amended 1945, 1945, 1949, 1959, 1967, 1972, 2011 and 370.320, RSMo 1939, amended 1945, 1967, 1972, 1982, 1984, 2011 .
