A Bank’s board of directors is responsible for reviewing and adopting policies and procedures that establish an effective real estate appraisal and evaluation program. The program should:
•Provide for the independence of the persons ordering, performing and reviewing appraisals or evaluations;
•Establish selection criteria and monitor the ongoing performance of appraisers and persons who perform evaluations;
•Ensure that appraisals comply with the Agencies’ appraisal regulations and are consistent with supervisory guidance;
•Ensure that appraisals and evaluations contain sufficient information to support the credit decision;
•Maintain criteria for the content and appropriate use of evaluations consistent with safe and sound banking practices;
•Provide for the receipt and review of the appraisal or evaluation report in a timely manner to facilitate the credit decision;
•Develop criteria to assess whether an existing appraisal or evaluation may be used to support a subsequent transaction;
•Implement internal controls that promote compliance with these program standards, including those related to monitoring third party arrangements;
•Establish criteria for monitoring collateral values; and
•Establish criteria for obtaining appraisals or evaluations for transactions that are not otherwise covered by the appraisal requirements of the agencies’ appraisal regulations.