The Financial Accounting Standards Board has issued Financial Accounting Statements Nos. 166 and 167, consigning qualified special purpose entities to the scrap heap on January 1, 2010, for most financial institutions. Banks that sold mortgages and other loans into such securities will have to find a place for them on their balance sheets in the coming fiscal year. The American Bankers Association has written a letter to regulators urging a coordinated approach to guidelines.
“We have been communicating with the banking agencies to ensure that any changes to regulatory capital risk weightings reflect only the actual risk posed to the bank,” said Donna Fisher, ABA senior vice president of tax and accounting in a press statement issued on June 12. The association wants a transition period for such changes of at least three years, with a moratorium in the first year the FASB changes take effect.