Regulatory Alerts2014-07-30
Circular 3/2014 of the Bank of Spain on fostering the independence of valuation activities and regulating the deduction of intangible assets
The Bank of Spain issued Circular 3/2014 to mandate independence mechanisms for credit institutions and approved valuation societies, specifically requiring a detailed internal code of conduct to prevent conflicts of interest in property valuations. The regulation amends previous circulars to enforce strict separation between valuation services and commercial units, prohibit significant shareholdings by banks in valuation firms, and standardize reporting requirements for intangible asset deductions under EU prudential rules. These measures aim to ensure that property valuations are conducted objectively and technically, thereby protecting the integrity of the mortgage market and enhancing consumer protection.
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