According to the head of the central bank, an accurate valuation of collateral is a key element of credit risk management. The ability of banks to correctly assess potential losses in the event of borrower default and to accurately calculate mandatory risk indicators depends on the accuracy of these calculations.
“A prudent approach does not mean artificially undervaluing properties. On the contrary, the aim is to obtain independent and well-founded data that clearly reflects current market realities,” emphasised Anca Dragu.
The Governor of the NBM specifically highlighted the division of responsibility for the quality of valuations. As it is commercial banks that assume the financial risks when granting loans, they are obliged to exercise strict control over the work of valuers and to bear responsibility for the final figures on which they rely.
At the same time, the regulator identified a systemic problem in the market: a lack of transparent data infrastructure. The absence of unified, reliable databases creates a high degree of uncertainty when calculating the value of properties and complicates the work of valuers.
The situation is exacerbated by a shortage of qualified personnel: to date, there are only 101 officially registered authorised valuers in the Republic of Moldova holding valid qualification certificates.
The National Bank will continue to reform the risk monitoring system in order to protect depositors’ funds and prevent the formation of ‘bubbles’ in the property market due to incorrect valuations of collateral.
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