Professional Association of Valuation Companies of Portugal Portugal

“Portugal: How did valuers survive the downturn? Did they develop new skills and fields

• 2008 -2017 Overview Valuation Fees for Sample portfolio of 8 different properties

• 2008 -2017 Overview Valuation and Revaluation Fees for Sample portfolio of 8

• 2008 -2017 Overview ü Valuation requests during the downturn decreased to 1/3

• Valuation Companies Reaction ü Downsizing • Concentration (closing office branches) • Reducing

• Regulation – New Rules ü Bank of Portugal (BP) – aplly ECB

• Where do we stand today ü Just some of the companies that

• Finally, Where do we really stand? ü At the limit of unsustainability

We still have a long way to go Thank you

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Professional Association of Valuation Companies of Portugal “Portugal: How did valuers survive the downturn? Did they develop new skills and fields of activity and are they still relevant in the current rising markets? ” by Paulo Barros Trindade REV, President of The Board of ASAVAL October 2018 Athens, 19

“Portugal: How did valuers survive the downturn? Did they develop new skills and fields of activity and are they still relevant in the current rising markets? ” • 2008 -2017 Overview • Valuation Companies Reaction • Regulation – new rules • Where do we stand today ASAVAL. 2018

• 2008 -2017 Overview ASAVAL. 2018

• 2008 -2017 Overview Valuation Fees for Sample portfolio of 8 different properties ASAVAL. 2018

• 2008 -2017 Overview Valuation and Revaluation Fees for Sample portfolio of 8 different properties - 2017 ASAVAL. 2018

• 2008 -2017 Overview ü Valuation requests during the downturn decreased to 1/3 ü Valuation fees during the downturn decreased to 1/3 ü Revaluation of collaterals (rules of ECB and BP) represents now around 35% of the total valuation requests ASAVAL. 2018

• Valuation Companies Reaction ü Downsizing • Concentration (closing office branches) • Reducing staff ü Introducing new services • Energetic Certification • Companies Valuation • Consultory to bank branches relocation ü Quest for new markets • Internationalization ASAVAL. 2018

• Regulation – New Rules ü Bank of Portugal (BP) – aplly ECB rules and more – strict rules for collaterals revaluation ü New law (Law 153/2015) that regulates the activity of valuation of property for the finantial sector ü New Regulator – CMVM-Portuguese Securities Market Commission (before 2015 regulated only the activity of valuation for real estate funds) ASAVAL. 2018

• Where do we stand today ü Just some of the companies that found new international markets remain on those markets ü Downturn and more strict regulation reduced considerably the number of valuers working for the finantial sector ü Economic return increased loan activity and therefore valuation requests ü Shortage of CMVM’s accredited valuers in the market brought to higher salaries for internal valuers ü Valuation Companies concentrate their activity manly on valuation and give up other services or develop spin-off companies for this services ASAVAL. 2018

• Finally, Where do we really stand? ü At the limit of unsustainability • Persists downturn valuation fees and heavy resistence to update them • Higher costs due to higher internal valuers salaries and new regulation costs • Unfair competition from companies that don't comply with ASAVAL’s Code of Conduct and Ethics – need for better regulation ASAVAL. 2018

We still have a long way to go Thank you