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IHS Markit Launches Forecasting Solution for CECL Compliance

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Shares of IHS Markit Ltd. have gained 6.7% in the past year compared with the industry‘s 3.7% rise.

The company recently announced the launch of an economic and financial scenario solution, an offering that helps banks comply with the Current Expected Credit Loss (CECL) estimation.

The CECL requires lending organizations to evaluate probable credit losses by simulating credit loss scenarios and report losses on a quarterly or monthly basis. Meeting CECL standards require reasonable macroeconomic and financial forecasts as well as historical macro data. It also involves modeling, analysis and reporting in minute detail.

Powered by IHS Markit’s macroeconometric model, the solution provides economic scenarios that enable users estimate expected credit impairment and evaluate risks associated with credit losses.

IHS Markit Ltd. Revenue (TTM)

 

 

National and Regional Level Scenarios

The solution includes historical and forecast data for eight scenarios at a national level and three scenarios at a regional level (nine regions, 50 states and the top 100 metropolitan areas). Forecasts are provided over a 10-year period and updated monthly. Scenarios are accessible through the Connect Platform and can be implemented across various vendor platforms.

The solution should boost IHS Markit’s Economics and Country Risk (ECR) offerings under its Consolidated Markets & Solutions (CMS). ECR offers a wide range of economic and risk data, forecasts as well as analytic tools to help clients with strategic market planning, procurement and risk management decisions.

Zacks Rank & Stocks to Consider

IHS Markit currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

A few better-ranked stocks in the broader Zacks Business Services sector include Booz Allen Hamilton (BAH - Free Report) , Waste Connections (WCN - Free Report) and Republic Services (RSG - Free Report) , each carrying a Zacks Rank #2 (Buy). Long-term expected earnings per share (three to five years) growth rate for Booz Allen Hamilton, Waste Connections and Republic Services is 14.4%, 11.7% and 10.7%, respectively.

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