Article 13
Areas requiring particular attention in the valuation
The valuer, or the resolution authority where conducting a provisional valuation pursuant to Article 26(1) of Regulation (EU) 2021/23, shall particularly focus on areas subject to significant valuation uncertainty which have a significant impact on the overall valuation for the purpose of Article 24(2) of Regulation (EU 2021/23.
For the areas referred to in the first subparagraph, the valuer, or the resolution authority where conducting a provisional valuation pursuant to Article 26(1) of Regulation (EU) 2021/23, shall provide the results of the valuation in the form of best point estimates and, where appropriate, value ranges, as set out in Article 6(3). Those areas shall include:
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(a) |
contracts referred to in Article 29(1) of Regulation (EU) 2021/23; |
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(b) |
loans, the expected cash flows of which depend on a counterparty’s ability, willingness or incentive to perform its obligations; |
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(c) |
repossessed assets, the cash flows of which are affected by both the asset’s fair value at the time the CCP forecloses on the related security or lien, and the expected evolution of such value after foreclosure; |
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(d) |
any other instruments measured at fair value where the determination of that fair value in accordance with accounting or prudential requirements applying to their marking to market or marking to model is no longer applicable or valid taking into account the circumstances; |
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(e) |
goodwill and intangibles, where the impairment test may depend on subjective judgement, including as regards the reasonably attainable cash flow stream, discount rates, and the perimeter of cash-generating units; |
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(f) |
legal disputes and regulatory actions, the expected cash flows of which may be subject to varying degrees of uncertainty relating to their amount or timing; |
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(g) |
items including pension assets and liabilities and deferred tax items. |