ECCB 2022-2023 Annual Report and Financial Statements

Eastern Caribbean Central Bank Notes to the Financial Statements For the year ended 31 March 2023 (Expressed in Eastern Caribbean dollars)

15. Property and equipment (continued)

Measurement of fair values

Valuation techniques and significant unobservable inputs

The Bank’s land and buildings were revalued as of 31 March 2021 by a professional, independent property appraiser. The properties are stated at fair market value, as appraised by the appraiser. The values for the properties were determined using the following methodologies which best reflect the nature of the property: the comparable sales approach and the cost approach.

Land and buildings shown at revalued amounts are included in in Level 3 on the fair value hierarchy.

The following table shows the valuation techniques used in measuring Level 3 fair values, as well as the significant unobservable inputs used.

Inter-relationship between key unobservable inputs and fair value measurement

Valuation techniques

Significant unobservable Inputs Adjustment to price based on land sales in the area – EC$20 to EC$30 per square foot for commercial; EC$20 to EC$25 per square foot for residential 

Category

The estimated fair value would increase /(decrease) if:  Sales value of comparable properties were higher/(lower) Comparability adjustment were higher/(lower) The estimated fair value would increase /(decrease) if:  the estimated costs of construction for buildings were higher/(lower) 

Sales Comparable Approach

Land

 

Condition of building Construction cost per square foot - EC$1,800 to EC$2,200

Commercial Property

Cost Approach



Mark-up based on standard scale

The estimated fair value would increase /(decrease) if:  Sales value of comparable



Details of sales of comparable properties – Sale price EC$1.5m to EC$1.8m for the area Comparable adjustment

Sales Comparable Approach

Residential Property

properties were higher/(lower) Comparability adjustment were higher/(lower)





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