The European Banking Authority (EBA) has published a Consultation Paper on draft regulatory technical standards (RTS) on independent valuers.
The EBA is required by article 36(14) of the Bank Recovery and Resolution Directive (BRRD) to draft RTS to identify the circumstances in which a valuer is to be considered independent from any public authority, including the resolution authority and the institution. The BRRD specifies that independent valuers should be appointed to perform valuations of the assets and liabilities of institutions to determine whether an institution is failing or likely to fail, the scope and size of resolution measures to be taken, and whether shareholders and creditors would have received better treatment if the institution under resolution had entered into normal insolvency proceedings.
Within the draft RTS, the EBA puts forward two situations that prevent a valuer from being considered independent, namely when the valuer is not separate from the resolution authority or the bank in question and when they have been the bank’s auditor in the previous year.
The deadline for responding to the Consultation Paper is 11 October 2014. The EBA is required to submit the draft RTS to the European Commission by 3 July 2015.
View Consultation Paper – Draft regulatory technical standards on independent valuers, 11 July 2014