In the December 10, 2010 Federal Register (75 FR 77450) the Office of the Comptroller of the Currency (OCC), the Board of Governors of the Federal Reserve System (FRB), the Federal Deposit Insurance Corporation (FDIC), the Office of Thrift Supervision (OTS), and the National Credit Union Administration (NCUA) (the Agencies) jointly issued new Interagency Appraisal and Evaluation Guidelines (Guidelines) for federally regulated financial institutions. These new Guidelines supersede the 1994 Interagency Appraisal and Evaluation Guidelines. The Guidelines address supervisory matters relating to real estate appraisals and evaluations used to support real estate-related financial transactions. The Guidelines also provide clarification of the Agencies’ appraisal regulations and guidance about the Agencies’ expectations for prudent appraisal and evaluation polices, procedures, and practices. The Guidelines contain four appendices that clarify current regulatory requirements and supervisory guidance. Appendix A provides further clarification on real estate-related financial transactions that are exempt from the Agencies’ appraisal regulations. Appendix B addresses use of analytical methods or technological tools in the development of an evaluation. Appendix C clarifies the minimum appraisal standards required by the Agencies’ appraisal regulations for analyzing and reporting appropriate deductions and discounts in appraisals. Appendix D provides a glossary of terms. The Guidelines apply to all real estate lending functions and real estate-related financial transactions originated or purchased by a regulated financial institution or its operating subsidiary for its own portfolio or as assets held for sale, including activities of commercial and residential real estate mortgage operations. The Guidelines are too voluminous to attach to this memorandum, but you may access the Guidelines, located on pages 77456 through 77473 of the above cited Federal Register, at the following Web address:

Complete Memorandum