As per IFRS 9, Impairment Assessment is based on the concept of Expected Credit Losses (ECL). ECL are the expected credit losses that result from all possible default events over the expected life of the financial instrument.
Surya’s ECL Calculator is designed to provide ECL for the financial instruments as per IFRS 9

ECL Calculation Steps:

  • Staging : Assets are classified into 3 stages based on the changes in credit quality since initial recognition.
  • PD Models : Likelihood of a default over a particular time horizon. 12M PD models and Lifetime PD models.
  • LGD : The loss incurred from a defaulted account expressed in percentage of Exposure at the time of Default (EAD).
  • EAD : The gross exposure on a facility at the time of default of the obligor.