3.	RECENT ACCOUNTING PRONOUNCEMENTS

In September 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update "(ASU") No. 2016-13, Financial Instruments – Credit Losses (Topic 326), which requires that the measurement of all expected credit losses for financial assets held at the reporting date be based on historical experience, current condition, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. This guidance also amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration. For the Company, this guidance is effective for fiscal years and interim periods beginning after December 15, 2019. The Company has established a committee to oversee the adoption of ASU 2016-13 on its consolidated financial statements. The Company does not expect any impact on the current portfolio of available-for-sale debt securities. The Company expects to recognize a one-time cumulative effect change to the allowance for loan losses upon adoption on January 1, 2020. The Company has engaged a third party software provider to assist with the measurement of the expected credit losses, and has recently completed the implementation of the software. The third party software vendor has provided preliminary model results. The Company is currently reviewing the regression models and assumptions utilized. The Company has also engaged an independent third party vendor to validate the model to be utilized for measuring the expected credit losses. The Company is evaluating the magnitude of the impact on the consolidated financial statements.