18 Reserve Adjustment Computation

As part of Expected Credit Loss Computations, financial institutions in certain geographies are required or permitted to adjust the ECL values with additional reserves as per the guidelines applicable to their jurisdiction. OFS Loan Loss Forecasting and Provisioning application allow financial institutions to compute the additional reserve values corresponding to one or more factors specific to a portfolio. The factors could be Qualitative, Environmental, or any other type as required. The Qualitative and Environmental (Q&E) Reserve allocation is assigned at an account level. The factor-level values are then rolled up to a portfolio level and used in adjusting the aggregated ECL amount.