Interested Parties CTLs Conference Call – September 9, 2020
This was scheduled to be the last of a series of interested parties (IP) group calls regarding the National Association of Insurance Commissioners (NAIC) staff’s recommendation for changing the handling of credit tenant loans (CTL) for statutory accounting and reporting. However, based on the discussion today, the group decided to take a last look at the draft comment letter, submit any additional revisions, and hold one more call on September 14 to finalize the comment letter. The comment letter is due to NAIC staff on September 18.
IPs are taking exception with the NAIC staff recommendation that CTLs aren’t “bonds” and should be reported in Schedule BA with specific accounting developed for CTLs. The letter specifically asks for the rationale on why CTLs shouldn’t be classified as bonds and provides historical background indicating that CTL reporting shouldn’t be changed.
IPs argue that CTLs meet the definition of bonds and should be retained in Schedule D reporting. The group also decided at this time not to specifically argue which SSAP (Nos. 26R or 43R) CTLs fall under. This decision resulted mainly due to the rewriting of SSAP No. 43R that’s also occurring. The comment letter also disputes the division of CTLs into categories of “conforming” and “nonconforming.”
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