APRA should amend Prudential Standard APS 220 to:
- require that internal appraisals of the value of land taken or to be taken as security should be independent of loan origination, loan processing and loan decision processes; and
- provide for valuation of agricultural land in a manner that will recognise, to the extent possible:
- the likelihood of external events affecting its realisable value; and
- the time that may be taken to realise the land at a reasonable price affecting its realisable value.
The Government supports the Australian Prudential Regulation Authority (APRA) acting on this recommendation.