Question ID:
2014_1056
Legal Act:
Regulation (EU) No 575/2013 (CRR)
Topic:
Credit risk
Article:
229
Paragraph:
1
COM Delegated or Implementing Acts/RTS/ITS/GLs/Recommendations:
Not applicable
Article/Paragraph:
n/a
Disclose name of institution / entity:
No
Type of submitter:
Individual
Subject Matter:
Definition of independent valuer referred to in Article 229(1) of Regulation (EU) No 575/2013 (CRR)
Question:

1. What is a definition of independent valuer referred to in Article 229(1)? 2. Whether the definition of independent valuer referred to in Article 229(1) is specified in Article 208(3)(b)? 3. Whether independent valuer is defined as a person who possesses the necessary qualifications, ability and experience to execute a valuation and who is independent from the credit decision process? 4. Whether the Regulation (EU) No 575/2013 (CRR) imposes additional obligations than those indicated in Article 208(3)(b) on a person who execute valuation as independent valuer? 5. Whether an independent valuer referred to in Article 229(1) may be an employee of the bank? 6. Whether CRR excludes the possibility of valuing the property for the purposes of Article 229(1) by employees of the bank?

Background on the question:

According to the Article 125(2)(c) of Regulation (EU) No 575/2013 (CRR) Institutions shall consider an exposure or any part of an exposure as fully and completely secured for the purposes of paragraph 1 if the requirements set out in Article 208 and the valuation rules set out in Article 229(1) are met. According to Article 229(1) of CRR For immovable property collateral, the collateral shall be valued by an independent valuer (...) The only provision in CRR where independent valuer is mentioned is Article 208(3)(b) which states that review is carried out by a valuer who possesses the necessary qualifications, ability and experience to execute a valuation and who is independent from the credit decision process.

Date of submission:
08/04/2014
Published as Final Q&A:
03/10/2014
Final Answer:

In accordance with Article 208(3)(b) of Regulation (EU) No 575/2013 (CRR), the review of an immovable property collateral has to be carried out by a valuer who possesses the necessary qualifications, ability and experience to execute a valuation and who is independent from the credit decision process. As long as an employee of the bank meets all the aforementioned conditions, he/she can be considered as an independent valuer for the purposes of Article 229(1).

DISCLAIMER:

This question goes beyond matters of consistent and effective application of the regulatory framework. A Directorate General of the Commission (Directorate General for Internal Market and Services) has prepared the answer, albeit that only the Court of Justice of the European Union can provide definitive interpretations of EU legislation. This is an unofficial opinion of that Directorate General, which the European Banking Authority publishes on its behalf. The answers are not binding on the European Commission as an institution. You should be aware that the European Commission could adopt a position different from the one expressed in such Q&As, for instance in infringement proceedings or after a detailed examination of a specific case or on the basis of any new legal or factual elements that may have been brought to its attention.

Status:
Final Q&A
Answer prepared by:
Answer prepared by the European Commission because it is a matter of interpretation of Union law.
Note to Q&A:

Update 26.03.2021: This Q&A has not yet been reviewed by the European Commission in the light of the changes introduced to Regulation (EU) No 575/2013 (CRR).

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