Bankers asking for more fair value relief

The American Bankers Association (ABA), along with four other financial services organizations, asked with the U.S. House Financial Services Committee to provide further relief from fair value guidance.

“Other than temporary impairment continues to result in higher losses for U.S. companies versus companies that follow international accounting standards and may unintentionally increase the number of bonds that become subject to an OTTI charge,” according to a joint letter from the ABA, the American Council of Life Insurance, the American Insurance Association, the Council of Federal Home Loan Banks and The Financial Services Roundtable.

“Mark to market does not provide the most relevant measurement basis for many types of transactions,” the letter read. “FASB's emphasis on mark-to-market not only results in misleading information in a distressed market, but it can also result in misleading information in a typical market.”

Unlike past correspondence, this letter does not call for suspension of fair value, but instead the organizations say they hope to improve the accounting standards.

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