(b)

the following paragraph is inserted: ‘3a. Institutions may monitor the value of the immovable property and identify the immovable property in need of revaluation, in accordance with paragraph 3, by means of advanced statistical or other mathematical methods (“models”), provided that those methods are developed independently from the credit decision process and all of the following conditions are met: ; the institutions set out, in their policies and procedures, the criteria for using models to monitor the values of collateral and to identify the properties that should be revaluated; those policies and procedures shall account for such models’ proven track record, property-specific variables considered, the use of minimum available and accurate information, and the models’ uncertainty; the institutions ensure that the models used are: property- and location-specific at a sufficient level of granularity; valid and accurate, and subject to robust and regular back-testing against the actual observed transaction prices; based on a sufficiently large and representative sample, based on observed transaction prices; based on up-to-date data of high quality; the institutions are ultimately responsible for the appropriateness and performance of the models; the institutions ensure that the documentation of the models is up to date; the institutions have in place adequate IT processes, systems and capabilities and have sufficient and accurate data for any model-based monitoring of the value of immovable property collateral and identification of property in need of revaluation; the estimates of models are independently validated and the validation process is generally consistent with the principles set out in Article 185, where applicable.’

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Source: EUR-Lex (Cellar) · retrieved 2026-09-25 · Text as adopted (Official Journal); later amendments are not incorporated in this text.