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Covid 19 Implications On Credit Loss Provisioning Rules Under Ifrs 9 Pro-Cyclicality Concerns

Author

Listed:
  • Djelil Bilal

    (UMBB - Université M'Hamed Bougara Boumerdes)

  • Saidj Faiz

    (UMBB - Université M'Hamed Bougara Boumerdes)

Abstract

The objective of this paper is to analyse the procyclicality behavior of Expected Credit Loss (ECL) model introduced by IFRS 9, during the economic downturn due to the Covid 19 pandemic. A regression analysis was conducted on a dataset gathered from euro era in order to investigate the hypothesis suggesting that the new model does not exhibit a procyclical behavior. Our findings indicate that, despite the IASB's expectation that the ECL model would have a countercyclical impact, it still demonstrates procyclical behavior.

Suggested Citation

  • Djelil Bilal & Saidj Faiz, 2024. "Covid 19 Implications On Credit Loss Provisioning Rules Under Ifrs 9 Pro-Cyclicality Concerns," Post-Print hal-04678411, HAL.
    • Handle: RePEc:hal:journl:hal-04678411
    Note: View the original document on HAL open archive server: https://hal.science/hal-04678411
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    More about this item

    Keywords

    IFRS9 ECL model Procyclicality Covid 19 pandemic. JEL Classification Codes : E32 G21 M41; IFRS9; ECL model; Procyclicality; Covid 19 pandemic. JEL Classification Codes : E32; G21; M41;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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