PRA answers commonly asked questions on CRR requirements for property valuations
The Prudential Regulation Authority (PRA) has published a document responding to common questions relating to the Capital Requirements Regulation (CRR) for property valuations on residential and commercial real estate exposures.
Given the disruption caused by COVID-19, firms have identified difficulties in conducting physical inspections, obtaining reliable valuations and determining appropriate approaches to suspended or unreliable house price indices.
The document is aimed at all firms to which the CRR applies, and will be updated if appropriate as the situation evolves.
The topics currently covered in the document are: what is expected in relation to the monitoring and review of property valuations for existing mortgage exposures; and what approach to take if a house price index used to update property valuations is unreliable or unavailable.