Specific Provision

Under this method, the LLFP application calculates the CECL using the values of EAD (current), PD, and LGD. The application calculates the Lifetime PD from the given PD term structures.

Allowance is calculated as the product of the Carrying Amount, Lifetime PD, and LGD. Also, Provision is calculated as the product of the Undrawn Amount, CCF, Lifetime PD, and LGD.

The total Expected Credit Loss is derived as the sum of Allowance and Provision.