UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-QSB

	(Mark One)
ý	QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

	FOR THE QUARTERLY PERIOD ENDED June 30, 2002

o	TRANSITION REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934

	FOR THE TRANSITION PERIOD FROM TO

COMMISSION FILE NUMBER: 000—31977

CENTRAL VALLEY COMMUNITY BANCORP

(Name of small business issuer in its charter)

California		77-0539125
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

600 Pollasky Avenue, Clovis, California		93612
(Address of principal executive offices)		(Zip code)

Issuer’s telephone number (559) 298-1775

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15 (d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ý No o

State the number of shares outstanding of each of the issuer’s classes of common equity, as of August 9, 2002. 1,290,523 shares

Transitional Small business Disclosure Format (check one)

Yes o No ý

INDEX

PART I - FINANCIAL INFORMATION

ITEM 1 - FINANCIAL STATEMENTS

Consolidated Balance Sheet (unaudited) at June 30, 2002 and (audited) December 31, 2001

Consolidated Statement of Income (unaudited) for the Three Month Periods ended June 30, 2002 and 2001 and the Six Month Periods ended June 30, 2002 and 2001.

Consolidated Statements of Changes in Shareholders’ Equity for the Six Month Periods ended June 30, 2002 and 2001.

Consolidated Statement of Cash Flows (unaudited) for the Six Month Periods ended June 30, 2002 and 2001.

Notes to Consolidated Financial Statements

ITEM 2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

PART II - OTHER INFORMATION

ITEM 1 LEGAL PROCEEDINGS

ITEM 2 CHANGES IN SECURITIES AND USE OF PROCEEDS

ITEM 3 DEFAULTS UPON SENIOR SECURITIES

ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITITY HOLDERS

ITEM 5 OTHER INFORMATION

ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K

SIGNATURES

CENTRAL VALLEY COMMUNITY BANCORP

CONSOLIDATED BALANCE SHEET

JUNE 30, 2002 AND DECEMBER 31,2001

(In Thousands Except Share Amounts)

	June 30, 2002		Dec. 31, 2001
	(Unaudited)		(Audited)
ASSETS
Cash and due from banks	$	15,593	$	13,863
Interest bearing deposits with other banks	100		100
Federal funds sold	10,467		4,160
Available for sale investment securities (Book value of $55,305 at June 30, 2002 and $58,843 at December 31, 2001)	57,309		60,586
Loans less allowance for credit losses of $2,389 at June 30, 2002 and $2,474 at December 31, 2001	152,279		130,797
Equipment leased to others, net	723		1,217
Bank premises and equipment, net	2,881		1,864
Accrued interest receivable and other assets	8,466		6,479
Total assets	$	247,818	$	219,066

LIABILITIES AND SHAREHOLDERS’ EQUITY
Deposits:
Non-interest bearing	$	61,549	$	49,016
Interest bearing	146,032		143,116
Total deposits	207,581		192,132
Short-term borrowings	7,000		1,000
Long-term borrowings	8,000		2,000
Accrued interest payable and other liabilities	3,011		3,106
Total liabilities	225,592		198,238

Shareholders’ equity:
Preferred stock, no par value: 10,000,000 shares authorized, no shares issued or outstanding	—		—
Common stock, no par value; 20,000,000 shares authorized, 1,294,283 and 1,285,357 shares issued and outstanding at June 30, 2002 and December 31, 2001	6,129		6,049
Retained earnings	14,895		13,733
Accumulated other comprehensive income, net of tax	1,202		1,046
Total shareholders’ equity	22,226		20,828
Total liabilities and shareholders’ equity	$	247,818	$	219,066

See notes to consolidated financial statements.

CENTRAL VALLEY COMMUNITY BANCORP

CONSOLIDATED STATEMENT OF INCOME

For the Three and Six Month Periods Ended June 30, 2002 and 2001

(In Thousands Except Earnings Per Share Amounts)

	For the Three Months Ended June 30				For the Six Months Ended June 30
(Unaudited)	2002		2001		2002		2001
INTEREST INCOME:
Interest and fees on loans	$	2,831	$	2,541	$	5,441	$	5,093
Interest on Federal funds sold	21		83		45		140
Interest and dividends on investment securities:
Taxable	630		860		1,288		1,893
Exempt from Federal income taxes	120		118		241		236
Interest on deposits with other banks	1		1		1		3
Total interest income	3,603		3,603		7,016		7,365
INTEREST EXPENSE:
Interest on deposits	581		1,103		1,196		2,319
Other	102		—		163		11
Total interest expense	683		1,103		1,359		2,330
Net interest income before provision for credit losses	2,920		2,500		5,657		5,035
PROVISION FOR CREDIT LOSSES	—		35		—		497
Net interest income after provision for credit losses	2,920		2,465		5,657		4,538
NON-INTEREST INCOME:
Service charges	538		316		890		565
Rentals from equipment leased to others	274		344		620		689
Loan placement fees	64		54		147		96
Net realized gain on sales of investment securities	—		55		26		371
Other income	191		221		385		1,064
Total non-interest income	1,067		990		2,068		2,785
NON-INTEREST EXPENSES:
Salaries and employee benefits	1,525		1,328		2,926		2,587
Occupancy and equipment	322		226		570		451
Depreciation and provision for losses on equipment leased to others	247		301		494		752
Other expense	1,046		843		1,832		1,660
Total non-interest expenses	3,140		2,698		5,822		5,450

Income before income taxes	847		757		1,903		1,873
INCOME TAX EXPENSE	238		257		611		652
Net income	$	609	$	500	$	1,292	$	1,221

Basic earnings per share	$	0.47	$	0.39	$	1.00	$	0.94
Diluted earnings per share	$	0.45	$	0.38	$	0.95	$	0.92

See notes to consolidated financial statements

CENTRAL VALLEY COMMUNITY BANCORP

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

For the Six Month Periods ended June 30, 2002 and 2001

(Unaudited) (In thousands)

	Common Stock					Retained Earnings			Accumulated Other Comprehensive Income		Shareholders’ Equity			Comprehensive Income
	Stock		Amount			Retained Earnings			Accumulated Other Comprehensive Income		Shareholders’ Equity			Comprehensive Income
Balance, January 1, 2001	1,303		$	6,465		$	11,354		$	851	$	18,670
Comprehensive income
Net income						1,221					1,221			$	1,221
Other comprehensive income, net of tax:
Unrealized gains on available-for-sale investment securities									181		181			181
Total comprehensive income														$	1,402
Stock options exercised and related tax benefit	7		69								69
Repurchase and retirement of common stock	(9	)	(159		)						(159		)
Balance, June 30, 2001	1,301		$	6,375		$	12,575		$	1,032	$	19,982

Balance, January 1, 2002	1,285		$	6,049		$	13,733		$	1,046	$	20,828
Comprehensive income
Net income						1,292					1,292			$	1,292
Other comprehensive income, net of tax:
Unrealized gains on available-for-sale investment securities									156		156			156
Total comprehensive income														$	1,448
Cash dividend - $.10 per share						(130		)			(130		)
Stock options exercised and related tax benefit of $61,000	13		167								167
Repurchase and retirement of common stock	(4	)	(87		)						(87		)
Balance, June 30, 2002	1,294		$	6,129		$	14,895		$	1,202	$	22,226

See notes to consolidated financial statements.

CENTRAL VALLEY COMMUNITY BANCORP

CONSOLIDATED STATEMENT OF CASH FLOWS

For the Six Months Ended June 30, 2002 and 2001

(In Thousands) (Unaudited)

	2002			2001
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	1,292		$	1,221
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for credit losses	—			497
Allowance for residual losses on equipment leased to others	—			100
Depreciation, amortization and accretion, net	1,092			939
Net realized gains on sales of available-for-sale investment securities	(26		)	(371		)
Gain on sale of equipment	(1		)	—
Gain on sale of equipment leased to others	—			(58		)
Net increase in deferred loan fees	56			80
Net (increase) decrease in accrued interest receivable and other assets	(690		)	248
Increase in cash surrender value of life insurance	(119		)	(91		)
Net (decrease) increase in accrued interest payable and other liabilities	(34		)	459
Deferred Income tax expense	187			—
Net cash provided by operating activities	1,757			3,024

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of available for sale investment securities	(9,607		)	(7,956		)
Proceeds from sales and calls of available-for-sale investment securities	1,955			15,307
Proceeds from principal repayments and maturities of available for sale investment securities	10,908			7,208
Net increase in loans and leases	(21,538		)	(15,662		)
Proceeds from sale of equipment	7			58
Purchase of premises and equipment	(1,307		)	(212		)
Purchase of single premium cash surrender value life insurance policies	(1,475		)	(327		)
Net cash used in investing activities	(21,057		)	(1,584		)

CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase in demand, interest bearing and savings deposits	13,681			2,029
Net increase (decrease) in time deposits	1,767			(2,651		)
Proceeds from short-term borrowings	8,000			—
Proceeds from long-term borrowings	6,000			—
Payments on short-term borrowings	(2,000		)	—
Payments on notes payable for equipment leased to others				(31		)
Cash paid for dividends	(130		)	—
Share repurchase and retirement	(87		)	(159		)
Proceeds from exercise of stock options	106			51
Net cash provided by (used in) financing activities	27,337			(761		)

CASH USED IN DISCONTINUED OPERATIONS				(89		)

NET INCREASE IN CASH AND CASH EQUIVALENTS	8,037			590
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR	18,123			23,076
CASH AND CASH EQUIVALENTS AT END OF PERIOD	26,160			23,666

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Cash paid for:
Interest expense	1,323			2,367
Income taxes	445			60

Non-Cash Investing Activities:
Net change in unrealized gain on available-for-sale investment securities	261			301

See notes to consolidated financial statements

CENTRAL VALLEY COMMUNITY BANCORP

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1. GENERAL

All adjustments (consisting only of normal recurring accruals) which, in the opinion of Management, are necessary for a fair presentation of the Company’s consolidated financial position at June 30, 2002 and December 31, 2001; the results of its operations, changes in shareholders’ equity and its cash flows for the three month periods ended June 30, 2002 and 2001, and the six month periods ended June 30, 2002 and 2001 have been included. The results of operations and cash flows for the periods presented are not necessarily indicative of the results for a full year.

The accompanying unaudited financial statements have been prepared on a basis consistent with the accounting principles and policies reflected in the Company’s annual report for the year ended December 31, 2001.

Note 2. EARNINGS PER SHARE

	For Quarters Ended June 30,
EARNINGS PER SHARE (Unaudited)	2002		2001
Basic earnings per share	$	0.47	$	0.39
Diluted earnings per share	$	0.45	$	0.38

	For Six Months Ended June 30,
EARNINGS PER SHARE (Unaudited)	2002		2001
Basic earnings per share	$	1.00	$	0.94
Diluted earnings per share	$	0.95	$	0.92

Weighted Average Number of Shares Outstanding

	For Quarter Ended June 30, 2002	For Quarter Ended June 30, 2001
Basic Shares	1,294,552	1,301,357
Diluted Shares	1,369,825	1,335,689

	For Six Months Ended June 30, 2002	For Six Months Ended June 30, 2001
Basic Shares	1,294,593	1,303,757
Diluted Shares	1,363,729	1,329,602

Note 3. COMPREHENSIVE INCOME

Total comprehensive income is comprised of net earnings and net unrealized gains and losses on available-for-sale securities. Total comprehensive income for the three-month periods ended June 30, 2002 and 2001 was $1,014,000 and $426,000, respectively. For the six-month periods ended June 30, 2002 and 2001, comprehensive income totaled $1,448,000 and $1,402,000, respectively.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Management’s discussion and analysis should be read in conjunction with the Company’s unaudited consolidated financial statements, including the notes, appearing elsewhere in this document.

All statements contained herein that are not historical facts, such as statements regarding the Company’s current business strategy and the Company’s plans for future development and operations, are based upon current expectations. These statements are forward-looking in nature and involve a number of risks and uncertainties. Such risks and uncertainties include, but are not limited to, those described in Management’s Discussion and Analysis of Financial Condition and Results of Operations and include, among other things, (1) significant increases in competitive pressures in the banking industry; (2) changes in the interest rate environment resulting in reduced margins; (3) general economic conditions, either nationally or regionally, are less favorable than expected, resulting in, among other things, a deterioration in credit quality; (4) changes in the regulatory environment; (5) fluctuations in the real estate market; (6) changes in business conditions and inflation; and (7) changes in securities markets. Therefore, the information set forth in such forward-looking statements should be carefully considered when evaluating the business prospects of the Company.

Overview:

Central Valley Community Bancorp (OTC:CVCY) (the “Company”) was incorporated on February 7, 2000. The formation of the holding company offered the Company more flexibility in meeting the long-term needs of customers, shareholders, and the community it serves. The Company currently has one bank subsidiary. The Company’s market area includes the entire central valley area from Sacramento, California to Bakersfield, California. To garner public acceptance beyond the Clovis-Fresno area, the Company made a decision in the first half of 2002, to change the name of its one subsidiary, Clovis Community Bank, to Central Valley Community Bank (the “Bank”). This change was announced in the second quarter of 2002 and has been well received.

The Company reported net income of $1,292,000 for the first half of 2002 compared to $1,221,000 in the same period of 2001. The primary contributors to the increase were a $622,000 increase in net interest income before provision for credit losses and a $497,000 reduction in the provision for credit losses. These increases were partially offset by a $717,000 decrease in non-interest income and a $427,000 increase in non-interest expense. The increase in net income is more significant after adjusting for non-recurring items in 2001.

In 2001, the Company realized income from funds received as part of an insurance settlement and gains from sales of investments, which were partially offset by additions to the Bank’s provision for credit losses and provision for losses on equipment leased to others. After adjustments to exclude these items, net income for the first half of 2001 would have been $704,000. Comparing the two periods after the 2001 adjustment would reflect a $588,000, or 83.5%, increase for the first half of 2002 compared to the same period of 2001, as discussed below.

During the first half of 2002, the Bank relocated the River Park Branch in Fresno, California to a new site. Due to the success of the River Park Branch staff, the branch outgrew its initial 2,000 square foot leased facility and has relocated to a new 5,000 square foot facility in the same area. Leasehold improvements associated with this new facility are reflected in bank premises and equipment, net of depreciation, which increased $981,000 comparing June 2002 to June 2001.

The Bank also opened a new full service branch in the Sacramento area during the first half of 2002. The new Sacramento Private Banking facility is intended to serve the Sacramento area needs of the Company’s existing commercial customers whose needs fall outside the Fresno area but within the Sacramento area, as well as serving the banking needs of new customers.

The Bank also has plans to relocate its Fig Garden Branch from its 350 square foot location to a new 2,000 square foot site in the same area. The relocation is scheduled for the third quarter of 2002.

During the second quarter of 2002, the Bank formed a real estate investment trust, Central Valley Community Realty, LLC for the purpose of utilizing a means to potentially generate future additional capital for the Bank and with the intent of reducing state income tax expense. However, no assurance can be given that the Company will be successful in accomplishing these objectives.

Average assets for the first half of 2002 were $231,859,000 compared to $197,620,000 for the same period in 2001. The $34,239,000, or 17.3%, increase can be mainly attributed to the 39.8% increase in average loans. Loan growth is discussed in more detail below.

Average earning assets for the first half of 2002 were $206,635,000 compared to $175,339,000 for the same period in 2001. The $31,296,000, or 17.8%, increase can be mainly attributed to the increase in loan volumes mentioned above.

Similar to most of the banking industry, the Company’s net interest margin continues to be challenged by the 475 basis point decrease in Federal funds interest rates by the Federal Open Market Committee (FOMC) in 2001. Managing the decrease in loan yields and the effective rates paid on deposits have become increasingly difficult as the deposit rates may have reached near the bottom of consumer tolerance. Refer to Market Risk for further discussion of the Bank’s interest rate position.

The Company’s net interest margin decreased 26 basis points in the periods under review. The net interest margin for the six-month period ended June 30, 2002 was 5.48% compared to 5.74% for the same period in 2001. The decrease can be partially attributed to the declining rate environment and the fact that assets generally reprice more quickly than liabilities. West Coast prime rate remained constant in the first six months of 2002 compared to a decline of 275 basis points in the first six months of 2001. The effective yield on loans for those same periods was 7.59% and 9.87%, respectively. The effective rate on interest bearing deposits and other borrowings for the first half of 2002 was 1.73% compared to 3.49% for the same period in 2001.

The Company’s market focus for loans continues to concentrate on small to medium businesses offering both commercial and real estate loans, however the Company also offers consumer and agricultural lending. These loans are diversified as to industries and types of businesses, thus limiting material exposure in any industry concentrations. The Company offers both fixed and floating interest rate loans and typically obtains collateral in the form of real estate, business equipment, or accounts receivable, but looks to business cash flow as its primary source of repayment.

The following table indicates outstanding loan balances by type at June 30, 2002 and 2001 respectively, and their percentage to total loans.

Loan Type (Unaudited) (In thousands)	June 30, 2002		% of Total loans		June 30, 2001		% of Total loans
Commercial & Industrial	$	60,758	39.3	%	$	52,713	47.3	%
Real Estate	36,407		23.5	%	33,021		29.7	%
Real Estate - construction, land development and other land loans	50,239		32.5	%	17,150		15.4	%
Consumer & Installment	5,669		3.7	%	7,249		6.5	%
Agricultural	1,595		1.0	%	1,223		1.1	%

Total loans	$	154,668	100.0	%	$	111,356	100.0	%

The significant increase in real estate construction, land development and other land loans is partially attributable to the purchase of loan participations from other financial institutions and through brokers. These loans are to borrowers located in the Company’s general market area and undergo the same loan review process as loans originated by the Company. The Company believes that these loans represent no greater risk factors than loans originated by the Company.

Although management believes the loans within the concentrations reflected in the above table have no more than the normal risk of collectibility, a substantial decline in the performance of the economy in general or a decline in real estate values in the Company’s primary market area, in particular, could have an adverse impact on collectibility, increase the level of real estate-related non-performing loans, or have other adverse effects which alone or in the aggregate could have a material adverse effect on the financial condition of the Company.

Return on average assets (ROA) and return on average equity (ROE) for the periods under review are reflected in the following table.

(Unaudited)	For the Quarter Ended June 30, 2002		For the Quarter Ended June 30, 2001
ROA	1.02	%	1.01	%
ROE	11.07	%	10.97	%

(Unaudited)	For the Six Months Ended June 30, 2002		For the Six Months Ended June 30, 2001
ROA	1.11	%	1.24	%
ROE	11.92	%	12.73	%

The following table sets forth average assets, liabilities and shareholders’ equity; interest income earned and interest expense paid; and the average yields earned or rates paid thereon for the quarters ended June 30, 2002 and 2001 and the six months ended June 30, 2002 and 2001. The average balances reflect daily averages except non-accrual loans that were computed using quarterly and year-to-date averages.

CENTRAL VALLEY COMMUNITY BANCORP

SCHEDULE OF AVERAGE BALANCES AND AVERAGE YIELDS AND RATES

(Unaudited) (Dollars In Thousands)

	FOR THE THREE MONTHS ENDED June 30, 2002							FOR THE THREE MONTHS ENDED JUNE 30, 2001
	AVERAGE BALANCE			INTEREST		AVERAGE INTEREST RATE		AVERAGE BALANCE			INTEREST		AVERAGE INTEREST RATE
ASSETS
Interest-earning deposits in other banks	$	100		$	1	2.60	%	$	100		$	1	4.95	%
Investment securities:
Taxable securities	48,860			630		5.16	%	52,968			860		6.49	%
Non-taxable securities	9,384			120		5.12	%	8,506			118		5.55	%
Total investment securities	58,244			750		5.15	%	61,474			978		6.36	%
Federal funds sold	5,079			21		1.65	%	8,169			83		4.06	%
Loans	149,335			2,831		7.58	%	106,197			2,541		9.57	%
Total interest-earning assets	212,758			3,603		6.77	%	175,940			3,603		8.19	%
Allowance for credit losses	(2,336		)					(2,251		)
Non-accrual loans	948							147
Cash and due from banks	13,913							12,757
Premises	2,876							1,905
Other non-earning assets	10,678							9,613
Total average assets	$	238,837		$	3,603			$	198,111		$	3,603
LIABILITIES AND SHAREHOLDERS’ EQUITY
Interest-bearing liabilities:
Savings and negotiable orders of withdrawal	$	45,970		$	43	0.37	%	$	38,830		$	72	0.74	%
Money market accounts	48,086			191		1.59	%	41,980			358		3.41	%
Time certificates of deposit, under $100,000	37,138			259		2.79	%	35,846			447		4.99	%
Time certificates of deposit, $100,000 and over	14,858			88		2.37	%	16,568			226		5.46	%
Other borrowed funds	14,209			102		2.87	%	0			—		0.00	%
Federal funds purchased	14			—				15			—		5.00	%
Total interest-bearing liabilities	160,275			683		1.70	%	133,239			1,103		3.31	%
Non-interest bearing demand deposits	54,542							43,121
Other liabilities	2,005							3,518
Shareholders ’ equity	22,015							18,233

Total average liabilities and shareholders ’ equity	$	238,837		$	683			$	198,111		$	1,103

Interest income and rate earned on average earning assets				$	3,603	6.77	%				$	3,603	8.19	%
Interest expense and interest cost related to average interest-bearing liabilities				683		1.70	%				1,103		3.31	%

Net interest income and net interest margin				$	2,920	5.49	%				$	2,500	5.68	%

CENTRAL VALLEY COMMUNITY BANCORP

SCHEDULE OF AVERAGE BALANCES AND AVERAGE YIELDS AND RATES

(Unaudited) (Dollars In Thousands)

	FOR THE SIX MONTHS ENDED June 30, 2002							FOR THE SIX MONTHS ENDED JUNE 30, 2001
	AVERAGE BALANCE			INTEREST		AVERAGE INTEREST RATE		AVERAGE BALANCE			INTEREST		AVERAGE INTEREST RATE
ASSETS
Interest-earning deposits in other banks	$	100		$	1	2.60	%	$	100		$	3	4.95	%
Investment securities:
Taxable securities	48,402			1,288		5.32	%	57,354			1,893		6.60	%
Non-taxable securities	9,325			241		5.17	%	8,511			236		5.55	%
Total investment securities	57,727			1,529		5.30	%	65,865			2,129		6.46	%
Federal funds sold	5,425			45		1.66	%	6,148			140		4.55	%
Loans	143,383			5,441		7.59	%	103,226			5,093		9.87	%
Total interest-earning assets	206,635			7,016		6.79	%	175,339			7,365		8.40	%
Allowance for credit losses	(2,357		)					(2,131		)
Non-accrual loans	948							134
Cash and due from banks	13,908							12,696
Premises	2,480							1,862
Other non-earning assets	10,245							9,720
Total average assets	$	231,859		$	7,016			$	197,620		$	7,365
LIABILITIES AND SHAREHOLDERS’ EQUITY
Interest-bearing liabilities:
Savings and negotiable orders of withdrawal	$	45,225		$	84	0.37	%	$	38,780		$	158	0.81	%
Money market accounts	48,825			395		1.62	%	41,315			754		3.65	%
Time certificates of deposit, under $100,000	36,575			533		2.91	%	35,980			934		5.19	%
Time certificates of deposit, $100,000 and over	14,388			184		2.56	%	16,946			473		5.58	%
Other borrowed funds	11,917			163		2.74	%	375			10		5.33	%
Federal funds purchased	25			0		0.00	%	28			1		5.00	%
Total interest-bearing liabilities	156,955			1,359		1.73	%	133,424			2,330		3.49	%
Non-interest bearing demand deposits	50,959							42,555
Other liabilities	2,261							2,455
Shareholders’ equity	21,684							19,186
Total average liabilities and shareholders’ equity	$	231,859		$	1,359			$	197,620		$	2,330

Interest income and rate earned on average earning assets				$	7,016	6.79	%				$	7,365	8.40	%
Interest expense and interest cost related to average interest-bearing liabilities				1,359		1.73	%				2,330		3.49	%

Net interest income and net interest margin				$	5,657	5.48	%				$	5,035	5.74	%

Results of Operations for the Second Quarter of 2002 Compared to the Second Quarter of 2001

Net income for the second quarter of 2002 was $609,000 compared to $500,000 for the second quarter of 2001, a $109,000, or 21.8%, increase. The increase in net income between the periods resulted from increases in net interest income after provision for credit losses and non-interest income which were partially offset by increases in non-interest expense.

NET INTEREST INCOME

Net interest income is the Company’s primary source of revenue. Net interest income is the difference between the interest income received on interest-earning assets and the interest expense paid on interest-bearing liabilities. Net interest income is primarily affected by two factors, the volume and mix of interest-earning assets and interest-bearing liabilities and the interest rates earned on those assets and paid on the liabilities.

Interest income from loans increased 11.4%, or $290,000, in the periods under review as average total loan volumes increased 41.3% to $150,283,000 for the second quarter of 2002 compared to $106,344,000 for the same period of 2001. The $43,939,000 increase in the average loan volume can be attributed to the continued success of the Company’s strategic plan to build its core business with the introduction of new products, seasoned commercial bankers, and strong emphasis on business development and customer retention activities. Additionally, the successes of the River Park Branch and the expansion into the Sacramento market mentioned above have also contributed to the increase in volume. The Company purchased loans from other financial institutions and brokers during 2002 which also reflects in the second quarter 2002 volumes. No assurance can be given that this level of loan growth will continue.

The Company’s loan to deposit ratio at June 30, 2002 was 73.6% compared to 58.8% at June 30, 2001.

A significant portion of the Bank’s loan portfolio utilizes prime rate as a reference point in pricing loans. West Coast prime averaged 4.75% for the second quarter of 2002 compared to 7.41% for the same period of 2001. Average yield on loans (excluding non-accrual loans) was 7.58% for the three-month period ended June 30, 2002 compared to 9.57% in the same period of 2001.

The designation of a loan as non-accrual for financial reporting purposes does not relieve the borrower of its obligation to pay interest. Accordingly, the Company may ultimately recover all or a portion of the interest due on these non-accrual loans. A non-accrual loan returns to accrual status when the loan becomes contractually current and future collectibility of amounts due is reasonably assured.

A summary of non-accrual, restructured and past due loans at June 30, 2002, December 31, 2001 and June 30, 2001 is set forth below. All of the non-accrual loans arise out of four banking relationships of which two constitute the majority of the total non-accruals at June 30, 2002. Management can give no assurances that non-accrual and other non-performing loans will not increase in the future.

(Unaudited) (In Thousands)	June 30, 2002			December 31, 2001			June 30, 2001
Non-accrual
Loans secured by real estate	$	276		$	95		$	61
Commercial & industrial loans	779			1,013			69
Consumer loans	0			1			0
Total non-accrual	$	1,056		$	1,109		$	130
Accruing loans past due 90 days or more	0			0			0
Restructured loans	623			627			0
Total non-performing loans	$	1,679		$	1,736		$	130
Non-accrual loans to total loans	0.7		%	0.8		%	0.11		%

Loans considered to be impaired	$	1,056		$	1,108		$	16
Related allowance for credit losses on impaired loans	$	158		$	198		$	8

The investment policy of the Company is established by the Board of Directors and implemented by the Bank’s Investment Committee. It is designed primarily to provide and maintain liquidity, to enable the Company to meet its pledging requirements for public money and borrowing arrangements, to generate a favorable return on investments without incurring undue interest rate and credit risk, and to complement the Company’s lending activities.

Investments typically have yields lower than loans. Interest income from investment securities, Federal funds sold, and interest-bearing deposits in other banks decreased 27.3% in the periods under review. The decrease in these categories of income can be attributed to lower Federal funds rates, lower yields on new investment purchases, and decreased investment securities volume. The effective yield for investment securities not including Federal funds sold was 5.15% for the second quarter of 2002 compared to 6.36% for the same period in 2001. The effective yield for Federal funds sold was 1.65% for the second quarter of 2002 compared to 4.06% for the second quarter of 2001. As previously stated, FOMC lowered the Federal funds rate 475 basis points in 2001 which created, by the nature of collateralized mortgage obligations (CMOs) and mortgage backed securities (MBS), increased levels of principal prepayments in the periods under review. While a portion of the paydowns provided funding for loans, excess funds were generally reinvested at lower yields than those generated by the original investment.

Management’s review of all investments before purchase includes an analysis of how the security will perform under several interest rate scenarios to monitor whether investments are consistent with the Bank’s investment policy. The policy addresses issues of average life, duration, concentration guidelines, prohibited investments, and prohibited practices.

The Company recognizes the interest rate risk and prepayment risks associated with MBS and CMOs. In a declining interest rate environment, prepayments from MBS and CMOs would be expected to increase and the expected life of the investments would be expected to shorten. Conversely, if interest rates increase, prepayments would be expected to decline and the average life of the MBS and CMOs would be expected to extend. The percentage of MBS and CMOs to total assets was 13% at June 30, 2002 compared to 18% at June 30, 2001. The Bank has purchased certain of these investments which are meant to perform well in an increasing rate environment and others that are meant to perform well in a declining rate environment, with the ultimate goal of a balanced portfolio.

Average investment securities, including interest-bearing deposits in other banks and Federal funds sold, decreased 9.1%, or $6,320,000, to $63,423,000 for the second quarter of 2002 compared to $69,743,000 for the second quarter of 2001. Principal paydowns and liquidity needs for the increased loan volumes were the major contributors to the decrease in investment volume. Principal paydowns were $4,762,000 for the second quarter of 2002 compared to $2,503,000 for the same period of 2001.

The amortized cost and estimated market value of available-for-sale investment securities at June 30, 2002 and June 30, 2001 consisted of the following:

June 30, 2002 (Unaudited) (In thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Market Value
U.S. Government agencies	$	8,478	$	332	—			$	8,810
Obligations of states and political subdivisions	12,077		733		$	(6	)	12,810
U.S. Government agencies collateralized by mortgage obligations	32,537		865		—			33,396
Corporate bonds	971		80					1,051
Other securities	1,242							1,242
	$	55,305	$	2,010	$	(6	)	$	57,309

June 30, 2001 (Unaudited) (In thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Market Value
U.S. Treasury securities	$	1,002	$	3	—			$	1,005
U.S. Government agencies	6,310		285		—			6,595
Obligations of states and political subdivisions	12,039		597		—			12,636
U.S. Government agencies collateralized by mortgage obligations	34,953		822		(33		)	35,742
Federal Home Loan Mortgage Corporation non-cumulative preferred stock	1,009		—		(9		)	1,000
Corporate bonds	964		55		—			1,019
Other securities	2,453							2,453
	$	58,730	$	1,762	$	(42	)	$	60,450

The Company offers a variety of deposit accounts having a range of interest rates and terms. The Company’s deposits consist of savings, demand deposits, and certificates of deposit accounts. The flow of deposits is influenced significantly by general economic conditions, changes in the money market and prevailing interest rates and competition. The Company’s deposits are obtained primarily from the geographic area in which its offices are located. The Company relies primarily on customer service and long-standing relationships with customers to attract and retain these deposits. The Company does not use brokered deposits, and, based on historical experience, management believes it will continue to retain a large portion of its time deposit accounts at maturity.

Interest expense for the second quarter of 2002 was $683,000 compared to $1,103,000 for the second quarter of 2001. This $420,000, or 38.1%, decrease in interest expense can be partially attributed to the 475 basis point decrease in Federal funds interest rates in 2001 compared to the stable interest rate environment in the second quarter of 2002. Interest rates on deposits typically lag behind immediate changes in Federal funds rates and then generally reflect only a percentage of the rate changes on deposit accounts. Effective rates for interest bearing liabilities was 1.70% for the

second quarter of 2002 compared to 3.31% for the same period of 2001, a 161 basis point decrease. If interest rates were to decline or continue to remain unchanged in the remainder of 2002, the Company could experience restraints on further decreases in the rates paid on deposit products. Additionally, the interest rate risk could increase as depositors are reluctant to accept continued low deposit rates and search for higher yields in investment products other than those offered by the Company. Conversely, if interest rates were to increase, the Company could benefit from the immediate increase in loan rates without comparable immediate increases in deposit rates.

The following table indicates the average balances of interest-bearing deposit products, the percentage of each to total deposits, and the effective rates paid.

(Unaudited) (Dollars in Thousands)	Quarter Ended June 30, 2002						Quarter Ended June 30, 2001
(Unaudited) (Dollars in Thousands)	Quarterly Avg.Bal.		% of Total Deposits		Effective Rate		Quarterly Avg.Bal.		% of Total Deposits		Effective Rate
NOW Accounts	$	33,127	16.5	%	0.24	%	$	28,027	15.9	%	0.46	%
MMDA Accounts	48,086		24.0	%	1.59	%	41,980		23.8	%	3.41	%
Time Deposits	51,996		25.9	%	2.67	%	52,414		29.7	%	5.14	%
Savings Accounts	12,843		6.4	%	0.73	%	10,803		6.1	%	1.48	%

Total interest-bearing	146,052		72.8	%	1.59	%	133,224		75.5	%	3.31	%

Non-interest bearing	54,542		27.2	%			43,121		24.5	%
Total Deposits	$	200,594	100.0	%			$	176,345	100.0	%

Non-interest bearing deposits provide fairly inexpensive funding for loans and offer the opportunity for the Company to enhance and strengthen its net interest margin. Non-interest bearing deposits increased 26.5% in the second quarter of 2002 compared to the same period in 2001.

Other interest expense increased in the periods under review as the Company utilized its Federal Home Loan Bank (FHLB) credit line in the second quarter of 2002 in anticipation of short-term liquidity needs as well as to take advantage of opportunities to lock in low funding rates for increased loan growth. Borrowings from the FHLB were $15,000,000 at June 30, 2002. There were no balances outstanding at June 30, 2001. The average maturies and weighted average rate of the borrowings at June 30, 2002 was 1.1 years and 2.81%, respectively. The Company will continue to analyze the advantages and disadvantages of borrowing funds versus selling investment securities as part of its ongoing funding analysis.

Net interest income before provision for credit losses for the second quarter of 2002 was $2,920,000 compared to $2,500,000 for the second quarter of 2001, an increase of $420,000, or 16.8%. The increase in net interest income can be mainly attributed to the increase in loan interest income and the decrease in interest expense mentioned above.

PROVISION FOR CREDIT LOSSES

The Company provides for possible credit losses by a charge to operating income based upon the composition of the loan portfolio, past delinquency levels, losses and non-performing assets, economic and environmental conditions and other factors which, in management’s judgment, deserve recognition in estimating credit losses. Loans are charged off when they are considered uncollectible or of such little value that continuance as an active earning bank asset is not warranted.

The establishment of an adequate credit allowance is based on both an accurate risk rating system and loan portfolio management tools. The Board has established initial responsibility for the accuracy of credit risk grades with the individual credit officer. The grading is then submitted to the Chief Credit Officer (CCO), who reviews the grades for accuracy. The risk grading and reserve allocation is analyzed annually by a third party credit reviewer and by various regulatory agencies.

The CCO sets the specific reserve for all adversely risk-graded credits quarterly. This process includes the utilization of loan delinquency reports, classified asset reports, and portfolio concentration reports to assist in accurately assessing credit risk and establishing appropriate reserves. Reserves are also allocated to credits that are not adversely graded. Use of historical loss experience within the portfolio along with peer bank loss experience determines the level of reserves held.

The allowance for credit losses is reviewed at least quarterly by the Board’s Audit Committee and by the Board of Directors. Reserves are allocated to loan portfolio categories using percentages which are based on both historical risk elements such as delinquencies and losses and predictive risk elements such as economic, competitive and environmental factors. The Company has adopted the specific reserve approach to allocate reserves to each adversely graded asset, as well as to each impaired asset for the purpose of estimating potential loss exposure. Although the allowance for credit losses is allocated to various portfolio categories, it is general in nature and available for the loan portfolio in its entirety. Additions may be required based on the results of independent loan portfolio examinations, regulatory agency examinations, or the Company’s own internal review process. Additions are also required when, in management’s judgment, the allowance does not properly reflect the portfolio’s potential loss exposure.

Managing credits identified through the risk evaluation methodology includes developing a business strategy with the customer to mitigate the Company’s potential losses. Management continues to monitor these credits with a view to identifying as early as possible when, and to what extent, additional provisions may be necessary.

The Company made no additions to the allowance for credit losses in the second quarter of 2002 due mainly to decreased levels of risk-rated loans and increased recoveries on previously charged off loans. In the second quarter of 2001, $35,000 was added to the allowance for credit losses. Additionally, the Company’s historical net charge-off ratio, which reflects net charge-offs to beginning loan balances for the past three (3) years, declined to 0.209% for 2001 compared to 0.295% for 2000 and 2.642% for 1999.

At June 30, 2002, and December 31, 2001, the Company’s recorded investment in loans that were considered to be impaired totaled $1,056,000 and $1,108,000, respectively. The related allowance for credit losses on these impaired loans was $158,000 and $198,000, respectively. At June 30, 2001, the amount of impaired loans was immaterial.

The ratio of net credit recoveries to total average loans outstanding was 0.11% for the second quarter of 2002 compared to net credit recoveries of 0.01% for the same period in 2001. Net recoveries were $172,000 for the second quarter of 2002 and $11,000 for the same period of 2001. Non-performing loans at June 30, 2002 and 2001 were $1,679,000 and $237,000, respectively. The ratio of non-performing loans to the allowance for credit losses at June 30, 2002 was 70.3% compared to 10.3% at June 30, 2001. The increase can be mainly attributable to two non-accrual commercial borrowing relationships mentioned above.

Based on information currently available, management believes that the allowance for credit losses will be adequate to absorb potential risks in the portfolio. However, no assurance can be given that the Company may not sustain charge-offs which are in excess of the allowance in any given period.

Net interest income after the provision for credit losses increased $455,000, or 18.5%, in the periods under review.

NON-INTEREST INCOME

Non-interest income includes service charges, rental income from equipment leased to others, loan placement fees and other income as well as gains on sale of assets and gains on securities transactions.

Non-interest income increased $77,000, or 7.8%, to $1,067,000 in the second quarter of 2002 compared to $990,000 in the second quarter of 2001. The major contributor to the increase was service charges.

Service charges increased $222,000, or 70.3% in the periods under review. Increased deposit accounts and lower earnings credit rates for commercial deposit accounts were contributors to the increase. Business related deposit accounts may earn credit for average deposit holdings which may be used to offset service expenses. When the earnings credit is lower, the business will be required to increase deposit holdings or pay additional charges. The Company introduced a new product, Overdraft Privilege Account, in the second quarter of 2002, which created additional fees.

Rental income from equipment leased to others decreased $70,000 or 20.4% comparing the quarter ended June 30, 2002 to the same period in 2001. The decrease can be attributed to the maturity of several leases in the portfolio. The Company has decided not to actively pursue new operating lease arrangements. This decision is reflected in the lower volume of equipment leases to others, which was $723,000 at June 30, 2002 compared to $1,217,000 at December 31, 2001 and $1,881,000 at June 30, 2001

The Company earns loan placement fees from the brokerage of single-family residential mortgage loans. Loan placement fees increased $10,000, or 18.5%, in the periods under review. The 475 basis point reductions in the Federal funds rate by the FOMC in 2001 provided consumers with numerous opportunities for refinancing of single-family homes. Mortgage rates have continued to decrease in the current “rates unchanged” environment providing continued opportunities for refinance and new purchases. As interest rates remain unchanged or begin to increase, the opportunities for continued growth in this area may decline.

The Company had no net realized gain on sales of investment securities for the second quarter of 2002 compared to $55,000 for the same period in 2001. Liquidity needs in the first quarter of 2001 provided an opportunity for the Company to invest funds in higher yielding loans at a time when the loan demand increased and deposit volumes did not keep pace. As stated above, in the routine analysis of liquidity needs, the Company compares the advantages of borrowing funds or selling securities to meet liquidity needs. As discussed further in “Liquidity”, the Company utilized its FHLB borrowing line in the second quarter of 2002 to meet liquidity needs as opposed to the selling of securities to meet liquidity needs in the same period of 2001.

Other income decreased $30,000 in the periods under review. The majority of the decrease can be attributed to Other Real Estate Owned recoveries of $59,000 recognized in 2001.

NON-INTEREST EXPENSES

Non-interest expenses include salaries and employee benefits, occupancy and equipment expenses, depreciation and provision for losses on equipment leased to others and other expenses.

Non-interest expense for the second quarter of 2002 increased $489,000, or 18.5%, compared to the same period of 2001. The increase is mainly due to salaries, occupancy and equipment and other non-interest expense.

Salaries and employee benefits increased $197,000, or 14.8%, in the second quarter of 2002 compared to the same period in 2001. The increase can be mainly attributed to general salary and benefits increases that enable the Company to manage recent and projected growth and retain

qualified personnel. Additional personnel for the new Sacramento Branch were also partially responsible for the increase.

Occupancy and equipment expense increased $96,000 or 42.5% in the periods under review. Costs associated with the relocation of the River Park Branch, the start up of the Sacramento Branch, and the change in the Bank’s name were the main contributors to the increase. The Company also accelerated depreciation on leasehold improvements for its Fig Garden Branch in anticipation of the relocation in the second half of 2002.

Depreciation and provision for losses on equipment leased to others decreased $54,000 or 17.9% in the periods under review. The decrease is mainly the result of the Company’s decision not to actively pursue new operating lease arrangements.

Other non-interest expenses increased 31.4%, or $250,000 in the periods under review. Advertising and stationery costs related to the Bank’s name change from Clovis Community Bank to Central Valley Community Bank as described in the “Overview”, are the major contributors to the increase. Additionally start up costs for the Bank’s real estate investment trust are reflected in the increase.

INCOME BEFORE TAXES

Income before income tax expense increased $90,000 or 11.9%, to $847,000 for the second quarter of 2002 compared to $757,000 for the second quarter of 2001.

Results of Operations for the First Half of 2002 Compared to the First Half of 2001

Net income for the first half of 2002 was $1,292,000 compared to $1,221,000 for the first half of 2001, a $71,000, or 5.8%, increase. The increase in net income between the periods resulted from increases in net interest income after provision for credit losses, which were partially offset by decreases in non-interest income and increases in non-interest expenses. As stated in the “Overview”, the Company recognized certain non-recurring income in the first half of 2001. After adjustments to exclude these items, net income for the first half of 2001 would have been $699,000. Comparing the two periods after the 2001 adjustment would reflect a $593,000, or 84.8%, increase for the first half of 2002 compared to same period of 2001.

NET INTEREST INCOME

Interest income from loans increased 6.8%, or $348,000, in the periods under review as average total loan volumes increased 38.9% to $144,331,000 for the first half of 2002 compared to $103,360,000 for the same period of 2001. The $40,971,000 increase in the average loan volume can be attributed to the continued success of the Company’s strategic plan to build its core business with the introduction of new products, seasoned commercial bankers, and strong emphasis on business development and customer retention activities. Additionally, loans purchased from other financial institutions and brokers contributed to the successful growth. The Company’s loan to deposit ratio was 73.6% at June 30, 2002 compared to 58.8% at June 30, 2001. No assurance can be given that this level of loan growth will continue.

A significant portion of the Bank’s loan portfolio utilizes prime rate as a reference point in pricing loans. West Coast prime averaged 4.75% for the first half of 2002 compared to 7.99% for the same period of 2001. Average yield on loans (excluding non-accrual loans) was 7.59% for the six-month period ended June 30, 2002 compared to 9.87% in the same period of 2001.

Interest income from investment securities, Federal funds sold, and interest-bearing deposits

in other banks decreased 30.7% in the periods under review. The decrease in these categories of income can be attributed to lower Federal funds rates, lower yields on new investment purchases, and increased loan demand. The effective rate for investment securities not including Federal funds sold was 5.30% for the first half of 2002 compared to 6.46% for the same period in 2001. The effective yield for Federal funds sold was 1.66% for the first half of 2002 compared to 4.55% for the first half of 2001. Average investment securities, including interest-bearing deposits in other banks and Federal funds sold, decreased $8,861,000, to $63,252,000 for the first half of 2002 compared to $72,113,000 for the first half of 2001.

As previously stated, FOMC lowered the Federal funds rate 475 basis points in 2001 which created, by the nature of collateralized mortgage obligations (CMOs) and mortgage backed securities (MBS), increased levels of principal prepayments in the periods under review. While a portion of the paydowns provided funding for loans, excess funds were generally reinvested at lower yields than those generated by the original investment. Principal paydowns and increased loan volumes were the major contributors to the decrease in investment volume. Principal paydowns were $10,908,000 for the first half of 2002 compared to $4,908,000 for the same period of 2001.

Interest expense for the first half of 2002 was $1,359,000 compared to $2,330,000 for the first half of 2001. This $971,000, or 41.7%, decrease in interest expense can be partially attributed to the 475 basis point decrease in Federal funds interest rates in 2001. Effective rates for all interest bearing liabilities was 1.73% for the first half of 2002 compared to 3.49% for the same period of 2001, a 1.76 basis point decrease.

The following table indicates the average balances of interest-bearing deposit products, the percentage of each to total deposits, and the effective rates paid.

(Unaudited) (Dollars in Thousands)	Six Month Period Ended June 30, 2002						Six Month Period Ended June 30, 2001
(Unaudited) (Dollars in Thousands)	Year-to-date Average Balance		% of Total Deposits		Effective Rate		Year-to-date Average Balance		% of Total Deposits		Effective Rate
NOW Accounts	$	32,721	16.7	%	0.24	%	$	28,062	16.0	%	0.48	%
MMDA Accounts	48,825		24.9	%	1.62	%	41,315		23.5	%	3.65	%
Time Deposits	50,963		26.0	%	2.81	%	52,926		30.2	%	5.32	%
Savings Accounts	12,504		6.4	%	0.72	%	10,718		6.1	%	1.681	%

Total interest-bearing	145,013		74.0	%	1.65	%	133,021		75.8	%	3.48	%

Non-interest bearing	50,959		26.0	%			42,555		24.2	%
Total Deposits	$	195,972	100.0	%			$	175,576	100.0	%

Non-interest bearing deposits provide fairly inexpensive funding for loans and offer the opportunity to strengthen the Company’s net interest margin. Average non-interest bearing deposits increased 19.8% in the first six months of 2002 compared to the same period of 2001.

Other interest expense increased in the periods under review. As stated above, the Company utilized its Federal Home Loan Bank (FHLB) credit line in the first half of 2002 in anticipation of short-term liquidity needs as well as opportunities to lock in low funding rates for potential loan growth. The Company will continue to analyze the advantages and disadvantages of borrowing funds versus selling investment securities as part of its ongoing funding analysis.

Net interest income before provision for credit losses for the first half of 2002 was $5,657,000 compared to $5,035,000 for the first half of 2001, an increase of $622,000, or 12.3%. The increase in net interest income can be attributed mainly to the increase in loan interest income and the decrease in deposit interest expense mentioned above.

PROVISION FOR CREDIT LOSSES

The Company made no additions to the allowance for credit losses in the first half of 2002 due mainly to decreased levels of risk-rated loans which was partially offset by the increase in loan volumes mentioned above. In the first half of 2001, $497,000 was added to the allowance for credit losses. Additionally, the Company’s historical net charge-off ratio, which reflects net charge-offs to beginning loan balances for the past three (3) years, declined to 0.209% for 2002 compared to 0.295% for 2001 and 2.642% for 1999.

At June 30, 2002, and December 31, 2001 the Company’s recorded investment in loans that were considered to be impaired totaled $1,056,000 and $1,108,000, respectively. The related allowance for credit losses on these impaired loans was $158,000 and $198,000 respectively. Impaired loans were immaterial at June 30, 2001.

An analysis of the changes in the allowance for credit losses for the six month periods ended June 30, 2002 and 2001 is as follows :

	Allowance for Credit Losses For the Six Months Ended June 30,
(Unaudited) (In thousands)	2002			2001
Balance, beginning of the year	$	2,474		$	2,047
Provision charged to operations	0			497
Losses charged to the allowance	(302		)	(328		)
Recoveries on loans previously charged off	217			83

Balance, end of period	$	2,389		$	2,299

The ratio of net credit losses to total average loans outstanding was 0.06% for the first half of 2002 compared to net credit losses of 0.24% for the same period in 2001. Net charge offs were $85,000 and $245,000 for the first half of 2002 and 2001, respectively

Based on information currently available, management believes that the allowance for credit losses are adequate to absorb potential risks in the portfolio. However, no assurance can be given that the Company may not sustain charge-offs which are in excess of the allowance in any given period.

Net interest income after the provision for credit losses increased $1,119,000, or 24.7%, in the periods under review.

NON-INTEREST INCOME

Non-interest income decreased $717,000, or 25.8%, to $2,068,000 in the first half of 2002 compared to $2,785,000 in the first half of 2001. The major contributors to the decrease were other income and net realized gain on sales of investment securities recognized in 2001, which was partially offset by an increase in service charges in 2002.

Service charges increased $325,000, or 57.5% in the periods under review. Increased deposit accounts and lower earnings credit rates for commercial deposit accounts were the main contributors to the increase. Business related deposit accounts may earn credit for average deposit holdings which may be used to offset service expenses. When the earnings credit is lower, the business will be required to increase deposit holdings or pay additional charges. Additionally, the Company introduced a successful new deposit product, Overdraft Privilege Account, in the first half of 2002.

The Company earns loan placement fees from the brokerage of single-family residential mortgage loans. Loan placement fees increased $51,000, or 53.1%, in the periods under review. The 475 basis point reductions in the Federal funds rate by the FOMC in 2001 provided consumers with numerous opportunities for refinancing of single-family homes. As interest rates remain unchanged or begin to increase, the opportunities for continued growth in this area may decline.

Rental from equipment leased to others decreased $69,000 or 10.0% in the periods under review. As discussed in the “Results of Operations for the Second Quarter of 2002”, the decrease is mainly the result of the Company’s decision not to actively pursue new operating lease arrangements.

Net realized gain on sales of investment securities decreased $345,000 to $26,000 for the second quarter of 2002 compared to $371,000 for the same period in 2001. Liquidity needs in the first half of 2001 provided an opportunity for the Company to sell securities at a gain and invest funds in higher yielding loans at a time when the loan demand increased and deposit volumes did not keep pace. As stated previously, in the routine analysis of liquidity needs, the Company compares the advantages of borrowing funds or selling securities to meet liquidity needs.

Other income decreased $679,000 in the periods under review. The majority of the decrease can be attributed to the non-recurring earnings in 2001 from an insurance settlement mentioned above.

NON-INTEREST EXPENSES

Non-interest expense for the first half of 2002 increased $427,000, or 7.9%, compared to the same period of 2001. The increase is mainly due to advertising costs associated with the Bank’s name change from Clovis Community Bank to Central Valley Community Bank, increased salary expenses, and occupancy and equipment expenses which were partially offset by decreases in depreciation and provision for losses on equipment leased to others.

Salaries and employee benefits increased $339,000, or 13.1%, in the first half of 2002 compared to the same period in 2001. The increase can be mainly attributed to general salary and benefits increases and additional personnel that enable the Company to properly manage recent and projected growth and retain qualified personnel.

Occupancy and equipment expense increased $119,000 or 26.4% in the periods under review. The Company accelerated depreciation on leasehold improvements for two branches in anticipation of their re-locations. Additional contributors were expenses associated with the name change and start up costs associated with the Sacramento Branch.

Depreciation and provision for losses on equipment leased to others decreased $258,000 or 34.30% in the periods under review. As discussed in the “Results of Operations for the Second Quarter of 2002”, the decrease is mainly the result of the Company’s decision not to actively pursue new operating lease arrangements.

Other non-interest expenses increased $227,000 or 14.1% in the periods under review. Advertising costs increased 60.0%, or $108,000 reflecting the costs associated with the name change. Audit and accounting fees increased $82,000 mainly due to costs associated with the formation of the real estate investment trust. Stationery and supplies increased $28,000, again reflecting costs

associated with the name change and the opening of the Sacramento Branch. Offsetting these increases were decreases to legal fees of $46,000 and sundry operating losses of $11,000.

INCOME BEFORE TAXES

Income before income tax expense increased $30,000 or 1.6%, to $1,903,000 for the first half of 2002 compared to $1,873,000 for the first half of 2001.

OTHER INFORMATION

The Bank’s efficiency ratio is calculated by dividing non-interest expenses by the sum of net interest income before provision for credit losses and non-interest income. The ratio for the first half of 2002 was 75.4% compared to 69.0% in the first half of 2001. Excluding the non-recurring income and expenses realized in the first half of 2001, the ratio for the period ended June 30, 2001 was 78.5% compared to 75.4% for the same period in 2002. This means that for every dollar of income generated, the cost of generating that income was 75.4 cents in the first half of 2002 and 78.5 cents for the same period of 2001. The lower the ratio, the more efficient the Company’s operations. While reducing operating expenses can lower the ratio, the Company’s low loan to deposit ratio, which reduces net interest income, also significantly affects this ratio. Although the Company’s loan to deposit ratio has significantly increased in the period under review, the ratio remains lower than the Company’s peers, which was 77.4% at December 31, 2001.

OFF BALANCE SHEET COMMITMENTS:

Off balance sheet commitments are comprised of the unused portions of commitments to make or purchase extensions of credit in the form of loans or participations in loans, lease financing receivables, or similar transactions. Included are loan proceeds that the Company is obligated to advance, such as loan draws, construction progress payments, seasonal or living advances to farmers under prearranged lines of credit, rotating or revolving credit arrangements, including retail credit cards, or similar transactions. Forward agreements and commitments to issue a commitment at some point in the future are also included. The Company holds no off balance sheet derivatives and engages in no hedging activities.

The following table shows the distribution of the Company’s undisbursed loan commitments for the six months ended June 30, 2002 and 2001, respectively.

Loan Type	June 30, 2002		June 30, 2001
(In thousands)
Commercial & Industrial	$	23,270	$	30,647
Real Estate	19,441		22,722
Consumer & Installment	10,317		7,266
Total	$	53,028	$	60,635

CAPITAL RESOURCES:

Changes in total shareholders’ equity are reflected in the table below. The change in accumulated other comprehensive income reflects the effect on equity of unrealized gains or losses on available for sale securities.

(In thousands)	June 30, 2002 (Unaudited)		December 31, 2001(Audited)		June 30, 2001 (Unaudited)
Common stock	$	6,129	$	6,049	$	6,375
Retained earnings	14,895		13,733		12,575
Accumulated other comprehensive income	1,202		1,046		1,032

Total shareholders’ equity	$	22,226	$	20,828	$	19,982

The Company and the Bank are subject to certain regulatory requirements administered by the Board of Governors of the Federal Reserve System and the Federal Deposit Insurance Corporation (FDIC). Failure to meet these minimum capital requirements can initiate certain mandatory, and possibly additional discretionary, actions by regulators that, if undertaken, could have a direct material effect on the Company’s consolidated statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of the Bank’s assets, liabilities and certain off-balance-sheet items as calculated under regulatory accounting practices. The Company’s and the Bank’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors.

Quantitative measures established by regulation to ensure capital adequacy require the Company and the Bank to maintain minimum amounts and ratios of total and Tier 1 capital to risk-weighted assets and of Tier 1 capital to average assets. Each of these components is defined in the regulations. The consolidated quarterly average assets and risk-weighted assets of the Company and the quarterly average assets and risk-weighted assets of the Bank are not materially different at June 30, 2002. The Company and the Bank exceed all the regulatory capital adequacy requirements as of June 30, 2002.

In addition, the most recent notification from the FDIC categorized the Bank as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, the Bank must maintain minimum total risk-based, Tier 1 risk-based and Tier 1 leverage ratios as set forth below. There are no conditions or events since that notification that management believes have changed the Bank’s category. Tier 1 capital is comprised of common shareholders’ equity as modified by certain regulatory adjustments such as intangible assets, deferred taxes, and the effects of other comprehensive income (loss). The Bank continues to maintain capital levels substantially above those required for a well-capitalized bank under current capital adequacy regulations.

In February 2002, the Company announced its intent to repurchase up to $500,000, or approximately 3%, of its common stock through a stock repurchase plan that became effective March 1, 2002 and expires January 31, 2003. As of June 30, 2002, the Company has repurchased 4,006 shares, or 0.4% of total shares outstanding, at a total cost of $87,000.

In the first half of 2001, the Company’s Board of Directors approved a stock repurchase program with an expiration date of February 28, 2002. This repurchase program was successful in the repurchase of 25,900 shares of common stock at a total cost of $499,000.

The following table presents the Company’s capital ratios as of June 30, 2002 and December 31, 2001.

Total as of June 30, 2002 (Unaudited)	Actual				To Be Well- Capitalized Under Prompt Corrective Action Provisions				Minimum Regulatory Requirements
	Amount		Ratio		Amount		Ratio		Amount		Ratio

Total Capital (to risk weighted assets)	$	23,208,000	13.20	%	$	17,587,000	10.0	%	$	14,070,000	8.0	%
Tier 1 Capital (to risk weighted assets)	$	21,014,000	11.95	%	$	10,552,000	6.0	%	$	7,035,000	4.0	%
Tier 1 Capital (to average assets)	$	21,014,000	8.80	%	$	11,942,000	5.0	%	$	9,554,000	4.0	%

Total as of December 31, 2001 (Audited)
Total as of December 31, 2001 (Audited)	Amount		Ratio		Amount		Ratio		Amount		Ratio

Total Capital (to risk weighted assets)	$	21,655,000	14.3	%	$	15,192,000	10.0	%	$	12,154,000	8.0	%
Tier 1 Capital (to risk weighted assets)	$	19,755,000	13.1	%	$	9,115,000	6.0	%	$	6,077,000	4.0	%
Tier 1 Capital (to average assets)	$	19,755,000	8.9	%	$	11,062,000	5.0	%	$	8,850,000	4.0	%

Risk-weighted assets at June 30, 2002 were $175,865,000 compared to $151,921,000 at December 31, 2001. Average quarterly assets less regulatory adjustments were $238,837,000 at June 30, 2002 and $221,258,000 at December 31, 2001.

LIQUIDITY MANAGEMENT

The need for liquidity in a banking institution arises principally to provide for deposit withdrawals, the credit needs of its customers and to take advantage of investment opportunities as they arise. The Company may achieve desired liquidity from both assets and liabilities. The Company’s primary source of liquidity is from dividends received from the Bank. Dividends from the Bank are subject to certain regulatory restrictions.

The object of liquidity management is to maintain cash flow adequate to fund the Company’s operations and to meet obligations and other commitments on a timely and cost effective basis. In assessing liquidity, historical information such as seasonal demand, local economic cycles and the economy in general are considered, along with current ratios, management goals, and unique characteristics of the Company. Management accomplishes this objective through the selection of asset and liability maturity mixes that it believes will meet the Company’s needs.

The Company reviews its liquidity position on a regular basis based upon its current position and expected trends of loans and deposits. Liquidity is provided by the Bank’s core deposit base, shareholders’ equity, and reductions in assets, which can be immediately converted to cash at minimal cost. Liquid assets, which consist of cash, deposits in other financial institutions, Federal funds sold and available for sale investment securities, averaged $50,628,000 for the first six months of 2002, or 21.8% of average assets, compared to $71,959,000, or 36.4% of average assets for the first six months of 2001. The ratio of average liquid assets to average demand deposits was 99.3% for the first six months of 2002 compared to 169.1% for the first six months of 2001. The decrease in liquidity ratios can be attributed to the increase in loan volumes mentioned above. The Company sold approximately $9,549,000 in available for sale securities in the first half of 2001 for the purpose of liquidity compared to the short-term borrowings from the Federal Home Loan Bank (FHLB) which averaged

$11,917,000 for the first six months of 2002. The increase in FHLB borrowings required an increase in pledged securities. The Company has, and may do so in the future, sold securities to obtain needed liquidity. The Company analyzes the advantages and disadvantages of borrowing funds versus selling existing investment securities and their respective rates and yield.

Unpledged investment securities may also provide liquidity. At June 30, 2002, $41,224,000 in unpledged investments were available as collateral for borrowing compared to $46,113,000 at June 30, 2001. Additionally, maturing loans can provide liquidity. At June 30, 2002, approximately $36,297,000 in loans were scheduled to mature within the next ninety days.

The Bank had unsecured lines of credit with its correspondent banks which, in the aggregate, amounted to $6,000,000 at June 30, 2002 and December 31, 2001, at interest rates which vary with market conditions. The Bank also had a line of credit with the Federal Reserve Bank of San Francisco at June 30, 2002 and December 31, 2001 which bears interest at the prevailing discount interest rate collateralized by investment securities with amortized costs totaling $4,240,000 and $5,402,000 and market values totaling $4,475,000 and $5,703,000, respectively. In addition, the Bank had a credit line with the Federal Home Loan Bank at June 30, 2002 and December 31, 2001 which bears interest at the prevailing interest rate collateralized by investment securities with amortized costs totaling $15,250,000 and $5,045,000, respectively, and market values totaling $15,698,000 and $5,067,000, respectively. The amount of the credit line varies according to the make-up of the Bank’s investment and loan portfolio. At June 30, 2002 and December 31, 2001, the Bank had $15,000,000 and $3,000,000,respectively, outstanding on these credit lines. At June 30, 2001, the Bank had no outstanding borrowings under these credit lines.

Management believes that the Company’s current mix of assets and liabilities provide a reasonable level of risk related to significant fluctuations in net interest income or the result of volatility of the Company’s earnings base.

Management believes that the Company maintains adequate amounts of liquid assets to meet its liquidity needs. The Company’s liquidity might be insufficient if deposits or withdrawals were to exceed anticipated levels. Deposit withdrawals can increase if a company experiences financial difficulties or receives adverse publicity for other reasons, or if its pricing of products or services is not competitive with those offered by other financial institutions.

MARKET RISK

Market risk is the risk of loss from adverse changes in market prices and rates. The Company’s market risk arises primarily from interest rate risk inherent in its loan and deposit functions. Management actively monitors and manages this interest rate risk exposure.

Fluctuations in market interest rates expose the Company to potential gains and losses. The primary objective of asset/liability management is to manage the balance between rate sensitive assets and rate sensitive liabilities being repriced in any given period in order to maximize net interest income during periods of fluctuating interest rates.

Rate sensitive assets are those which contain a provision to adjust the interest rate periodically (for example, a loan in which prime rate determines the basis of the rate charged on outstanding balances). Those assets include certain commercial, real estate mortgage and construction loans and certain investment securities, Federal funds sold and time deposits in other financial institutions. Rate sensitive liabilities are those which provide for periodic changes in interest rate and include interest-bearing transaction accounts, money market accounts, and time certificates of deposit. Analysis has shown that because of time and volume influences, the repricing of assets and liabilities is not tied directly to the timing of changes in market interest rates. If repricing assets exceed repricing liabilities in a time period, the Company would be considered “asset sensitive” and have a “positive gap”. Conversely, if repricing liabilities exceed repricing assets in a time period, the

Company would be considered “liability sensitive” and have a “negative gap.”

Managing interest rate risk is important to the Company as its net interest margin can be affected by the repricing of assets and liabilities. Management uses several different tools to monitor its interest rate risk, including gap analysis. Additionally, the Company utilizes an asset/liability computer model which provides a detailed quarterly analysis of the Company’s financial reports, to include a ratio analysis of liquidity, equity, strategic free capital, volatile liability coverage, and maturity of the investment portfolio. In addition, a trend analysis is generated which provides a projection of the Company’s asset and liability sensitivity position over a 12 month period. Exposure to interest rate changes is calculated within the program to ascertain interest rate risk in actual dollar exposure resulting from incremental changes in marketing interest rates. The incremental changes are generally referred to as “shocks”. These “shocks” measure the effect of sudden and significant rate changes on the Company’s net interest income. Assets may not reprice in the same way as liabilities and adjustments are made to the model to reflect these differences. For example, the time between when the Company changes its rate on deposits may lag behind the time the Company changes the rate it charges on loans. Additionally, the interest rate change may not be in the same proportion for assets and liabilities. Interest rates on deposits may not decrease in the same proportion as a decrease in interest rates charged on loans. Conversely, interest rates on deposits may not be increased in the same proportion as rates charged on loans.

INFLATION

The impact of inflation on a financial institution differs significantly from that exerted on other industries primarily because the assets and liabilities of financial institutions consist largely of monetary items. However, financial institutions are affected by inflation in part through non-interest expenses, such as salaries and occupancy expense, and to some extent by changes in interest rates.

PART II OTHER INFORMATION

ITEM 4 Submission of Matters to a Vote of Security Holders.

a. The Company’s 2002 Annual Meeting of Shareholders was held May 15, 2002.

b. At the 2002 annual meeting the shareholders took the following actions:

• Elected Directors of the Company to serve until the 2003 annual Meeting of Shareholders and until their successors are elected and qualified.

• In the election for directors, no candidates were nominated for election as a director other than the nominees of the Board of Directors whose names were set forth in the Company’s proxy statement dated April 1, 2002. Set forth below is a tabulation of the votes cast in the election of Directors with respect to each nominee for office:

Director	Votes Cast for Election	Withheld
Sidney B. Cox	1,029,753	599
Daniel N. Cunningham	1,029,843	509
Edwin S. Darden	1,029,843	509
Daniel J. Doyle	1,029,843	509
Steven D. McDonald	1,029,843	509
Louis McMurray	1,029,843	509
Wanda L. Rogers	1,029,843	509
William S. Smittcamp	1,029,843	509
Joseph B. Weirick	1,029,843	509

• The ratification of the appointment of Perry-Smith LLP for the 2002 fiscal year as the Company’s independent public accountants. The appointment was ratified by the following votes:

Votes for: 1,027,209 Votes against: -0- Abstentions: 3,273

ITEM 5 Other information

None

ITEM 6 Exhibits and Reports on Form 8-K

(a) Exhibit 10.36 Form of Second Amended and Restated Director Deferred Fee

Agreement by and between Clovis Community Bank and Daniel N. Cunningham, Steven McDonald, Louis McMurray, Wanda Lee Rogers and William S. Smittcamp, effective February 13, 2002.

Exhibit 10.37 Schedule A, Participants’ Normal Retirement Age and Form of Benefit Elected to Second Amended and Restated Director Deferred Fee Agreement by and between Clovis Community Bank and Daniel N. Cunningham, Steven McDonald, Louis McMurray, Wanda Lee Rogers and William S. Smittcamp, effective February 13, 2002 .

Exhibit 10.38 Addendum A, Clovis Community Bank Split Dollar Agreement and Endorsement by and between Clovis Community Bank and Daniel N. Cunningham, Steven McDonald, Louis McMurray, Wanda Lee Rogers and William S. Smittcamp, effective February 13, 2002.

Exhibit 10.39 Schedule B, Participants and Their Executive Interest in Clovis Community Bank Split Dollar Agreement and Endorsement, by and between Clovis Community Bank and Daniel N. Cunningham, Steven McDonald, Louis McMurray, Wanda Lee Rogers and William S. Smittcamp, effective February 13, 2002.

Exhibit 10.40 Central Valley Community Bank Employee and Director Preferred Interest Bonus Plan.

Exhibit 99.1 Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Exhibit 99.2 Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

(b) On April 8, 2002, the Company filed a Current Report on Form 8-K reporting under Item 5 the issuance of a press release announcing unaudited financial information and accompanying discussion for the quarter-ended March 31, 2002.

On April 8, 2002, the Company filed on Form 8-K reporting under Item 5 the issuance of a press release announcing that its wholly owned subsidiary, Clovis Community Bank, opened its first northern valley location in Sacramento California.

On April 8, 2002, the Company filed on Form 8-K reporting under Item 5 the issuance of a press release announcing the opening of a branch office in Sacramento California.

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

CENTRAL VALLEY COMMUNITY BANCORP

Date:	August 9, 2002

By :	/s/ Daniel J. Doyle
	Daniel J. Doyle, CEO

Date:	August 9, 2002

By:	/s/ G. Graham
	G. Graham, Chief Financial Officer

EXHIBIT 10.36

CLOVIS COMMUNITY BANK

SECOND AMENDED AND RESTATED

DIRECTOR DEFERRED FEE AGREEMENT

THIS AGREEMENT is entered into this 13 ^th day of February, 2002 by and between CLOVIS COMMUNITY BANK, a California-chartered commercial bank located in Clovis, California (the “Company”), and (the “Director”).

INTRODUCTION

Whereas, the Director has contributed substantially to the success of the Company and its parent corporation,

Whereas, to encourage the Director to remain a Director of the Company, the Company is willing to provide a deferred fee opportunity to the Director payable out of the Company’s general assets,

Whereas, the Director and the Company are parties to an Amended and Restated Deferred Fee Agreement dated November 14, 1996,

Whereas, the parties to this Agreement intend that this Agreement supersede and replace in its entirety the November 14, 1996 Amended and Restated Deferred Fee Agreement, which November 14, 1996 Amended and Restated Deferred Fee Agreement shall become void and of no further force or effect on the date that this Agreement becomes effective,

Whereas, the Director made an initial deferral election by filing with the Company a signed Election Form within fifteen days after November 1, 1993, and whereas that Election Form shall continue in effect with this Agreement and does not become void pursuant to the immediately preceding paragraph with the cancellation of the November 14, 1996 Amended and Restated Deferred Fee Agreement,

Whereas, amounts deferred under the Amended and Restated Deferred Fee Agreement dated November 14, 1996 will be “rolled over” and covered under this Agreement,

Whereas, the Company will pay the benefits from its general assets,

Now Therefore, in consideration of the foregoing premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

ARTICLE 1

DEFINITIONS

Whenever used in this Agreement, the following words and phrases shall have the meanings specified:

1.1 “ Change of Control ” means that any of the following events occur:

(a) Merger: Central Valley Community Bancorp, parent corporation of Clovis Community Bank, merges into or consolidates with another corporation, or merges another corporation into Central Valley Community Bancorp, and as a result less than 50% of the combined voting power of the resulting corporation immediately after the merger or consolidation is held by persons who were the holders of Central Valley Community Bancorp’s voting securities immediately before the merger or consolidation. For purposes of this Agreement, the term “person” means an individual, corporation, partnership, trust, association, joint venture, pool, syndicate, sole proprietorship, unincorporated organization or other entity,

(b) Acquisition of Significant Share Ownership: a report on Schedule 13D or another form or schedule (other than Schedule 13G) is filed or is required to be filed under Sections 13(d) or 14(d) of the Securities Exchange Act of 1934, if the schedule discloses that the filing person or persons acting in concert has or have become the beneficial owner of 25% or more of a class of Central Valley Community Bancorp’s voting securities, but this paragraph (b) shall not apply to beneficial ownership of voting securities of Central Valley Community Bancorp held in a fiduciary capacity by an entity in which Central Valley Community Bancorp directly or indirectly beneficially owns 50% or more of the outstanding voting securities, or beneficial ownership of voting securities held by an employee benefit plan maintained for the benefit of Clovis Community Bank employees, or

(c) Change in Board Composition: during any period of two consecutive years, individuals who constitute Central Valley Community Bancorp’s board of directors at the beginning of the two-year period cease for any reason to constitute at least a majority thereof; provided, however , that, for purposes of this paragraph (c), each director who is first elected by the board (or first nominated by the board for election by stockholders) by a vote of at least two-thirds (2/3) of the directors who were directors at the beginning of the period shall be deemed to have been a director at the beginning of the two-year period.

1.2 “ Code ” means the Internal Revenue Code of 1986, as amended.

1.3 “Corporation” means Central Valley Community Bancorp.

1.4 “Deferral Account” or “Deferred Account” means the Company’s accounting of the Director’s accumulated Deferrals plus accrued interest.

1.5 “Deferrals” means the amount of the Director’s Fees, which the Director elects to defer according to this Agreement.

1.6 “ Disability ” means the Director’s inability to perform substantially all normal duties of a director, as determined by the Company’s Board of Directors in its sole discretion. As a condition to any benefits, the Company may require the Director to submit to such physical or mental evaluations and tests as the Board of Directors deems appropriate.

1.7 “ Effective Date ” means February 13, 2002 .

1.8 “ Election Form ” means the Form attached as Exhibit A.

1.9 “ Fees ” means the total directors fees payable to the Director during a Plan Year.

1.10 “ Normal Retirement Age ” means the Director’s ____ birthday.

1.11 “ Normal Retirement Date ” means the later of the Normal Retirement Age or

Termination of Service.

1.12 “ Plan Year ” means the calendar year.

1.13 “ Projected Benefit ” means the balance that would have accumulated in the Director’s Deferral Account at Normal Retirement Age if it is assumed that the Director: (1) continued to defer Fees at the same rate that the Director had been deferring Fees on the date of the Director’s death and (2) the Director reached Normal Retirement Age.

1.14 “ Termination for Cause ” means the Company’s board of directors or a duly authorized committee of the board of directors determines at any time that the Director will not be nominated by the board or committee for reelection as a Director of Central Valley Community Bancorp after the expiration of his current term, or if the Director is removed as a director of the Company, in either case because of the Director’s:

(a) gross negligence or gross neglect of duties, or

(b) commission of a felony, or commission of a misdemeanor involving moral turpitude, or

(c) fraud, disloyalty, dishonesty, or willful violation of any law or significant policy of Central Valley Community Bancorp or the Company, or

(d) removal from service or permanent prohibition from participation in the conduct of the Company’s affairs by an order issued under Section 8(e)(4) or (g)(1) of the Federal Deposit Insurance Act [ 12 U.S.C. 1818(e)(4) or (g)(1)].

1.15 “Termination of Service” means the Director ceasing to be a member for the Company’s Board of Directors for any reason whatsoever.

ARTICLE 2

DEFERRAL ELECTION

2.1 INITIAL ELECTION. The Director made an initial deferral election under this Agreement by filing with the Company a signed Election Form within fifteen (15) days after November 1, 1993. The Election Form set forth the amount of Fees to be deferred and the form of benefit payment. The Election Form was effective to defer only Fees earned after the date the Election Form is received by the Company. Such Initial Election (or any subsequent election under Section 2.2 that is in effect) shall continue in effect with this Agreement.

2.2 ELECTION CHANGES

2.2.1 GENERALLY. The Director may modify the amount of Fees to be deferred by filing a subsequent signed Election Form with the Company and obtaining written approval by the Board of Directors of the Company. The modified deferral shall not be effective until the calendar year following the year in which the subsequent Election Form is received by the Company. The Director may not change the form of benefit payment initially elected under Section 2.1 without the written approval of the Board of Directors of the Company.

2.2.2 HARDSHIP. If an unforeseeable financial emergency arising from the death of a family member, divorce, sickness, injury, catastrophe or similar event outside the control of the Director occurs, the Director, by written instructions to the Company may reduce future deferrals under this Agreement.

ARTICLE 3

DEFERRAL ACCOUNT

3.1 ESTABLISHING AND CREDITING. The Company shall continue to credit the Deferral Account on its books for the Director, and shall credit to the Deferral Account the following amounts:

3.1.1 DEFERRALS. The Fees deferred by the Director as of the time the Fees would have otherwise been paid to the Director.

3.1.2 INTEREST. At the end of each Plan Year under this Agreement and immediately prior to the payment of any benefits, but only until commencement of the benefit payments under this Agreement, unless otherwise stated, interest is to be credited on the account balance since the preceding credit under this Section 3.1.2, if any, equal to the rate determined by the Company’s Board of Directors, in its sole discretion.

3.2 STATEMENT OF ACCOUNTS. The Company shall provide to the Director, within one hundred twenty (120) days after each anniversary of this Agreement, a statement setting forth the Deferral Account balance.

3.3 ACCOUNTING DEVICE ONLY. The Deferral Account is solely a device for measuring amounts to be paid under this Agreement. The Deferral Account is not a segregated fund of any kind. The Director is a general unsecured creditor of the Company for the payment of benefits. The benefits represent the mere Company promise to pay such benefits. The Director’s rights are not subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or garnishment by the Director’s creditors.

ARTICLE 4

LIFETIME BENEFITS

4.1 NORMAL BENEFIT. Upon the Normal Retirement Date, the Company shall pay to the Director the benefit described in this Section 4.1 in lieu of any other benefit under this Agreement.

4.1.1 AMOUNT OF BENEFIT. The benefit under this Section 4.1 is the Deferral Account balance at the Director’s Normal Retirement Date.

4.1.2 PAYMENT OF BENEFIT. The Company shall pay the benefit to the Director in the form elected by the Director on the Election Form.

4.2 EARLY TERMINATION BENEFIT. Upon Termination of Service prior to the Normal Retirement Age for reasons other than death, Change of Control or Disability, the Company shall pay to the Director the benefit described in this Section 4.2 in lieu of any other benefit under this Agreement.

4.2.1 AMOUNT OF BENEFIT. The benefit under this Section 4.2 is the Deferral Account balance at the Director’s Termination of Service

4.2.2 PAYMENT OF BENEFIT. The Company shall pay the early termination benefit to the Director in a lump sum within forty-five (45) days after the Director’s Termination of Service if early termination occurs within five years of the Agreement’s Effective Date hereof. If early termination occurs after the Director has accrued five years of Deferrals, the early termination benefit shall be paid to the Director in the form elected by the Director on the Election Form.

4.3 DISABILITY BENEFIT. If the Director terminates service as a director for Disability prior to Normal Retirement Age, the Company shall pay to the Director the benefit described in this Section 4.3.

4.3.1 AMOUNT OF BENEFIT. The benefit under this Section 4.3 is the Deferral Account balance at the Director’s Termination of Service.

4.3.2 PAYMENT OF BENEFIT. The Company shall pay the Disability benefit to the Director in a single lump sum within forty-five (45) days after the Director’s Termination of Service if Disability occurs within five years of the Agreement’s Effective Date hereof. If Disability occurs after the Director has accrued five years of service, the Disability benefit shall be paid to the Director in the form elected by the Director on the Election Form.

4.4 CHANGE OF CONTROL BENEFIT. If Termination of Service occurs within 12 months after the first occurrence of a Change of Control, excepting Termination for Cause, the Company shall pay to the Director the benefit described in this Section 4.4 in lieu of any other benefit under this Agreement

4.4.1 AMOUNT OF BENEFIT. The benefit under this Section 4.4 is the Deferral Account balance at the date of the Director’s Termination of Service

4.4.2 PAYMENT OF BENEFIT. The Company shall pay the benefit to the Director in a lump sum within thirty (30) days after the Director’s Termination of Service.

4.5 HARDSHIP DISTRIBUTION. Upon the Company’s determination (following petition by the Director) that the Director has suffered an unforeseeable financial emergency as described in Section 2.2.2, the Company shall distribute to the Director all or a portion of the Deferral Account balance as determined by the Company, but in no event shall the distribution be greater than is necessary to relieve the financial hardship.

ARTICLE 5

DEATH BENEFITS

5.1 SPLIT DOLLAR DEATH BENEFITS FOR DEATH DURING ACTIVE SERVICE. If the Director dies before the Normal Retirement Age while in the active service of the Company, the Company shall pay to the Director’s beneficiary(ies) or estate the benefit described in the Split Dollar Agreement and Endorsement, attached to this Agreement as Addendum A, between the Company and the Director in lieu of any other benefit payable hereunder, in accordance with the terms and conditions of the Split Dollar Agreement and Endorsement unless the Director’s service with the Company terminated because of Termination for Cause.

5.2 SPLIT DOLLAR DEATH BENEFITS DURING PENDENCY OF COLLECTING DEFERRAL ACCOUNT BALANCE. If the Director dies after any benefit payments provided pursuant to Article 4 have commenced under this Agreement but before receiving all such payments, the remaining benefits shall be paid to the Director’s beneficiary(ies) or estate pursuant to the benefit described in the Split Dollar Agreement and Endorsement, attached to this Agreement as Addendum A, between the Company and the Director in lieu of any other benefit payable hereunder, in accordance with the terms and conditions of the Split Dollar Agreement and Endorsement.

5.3 COLLECTION IN FULL OF DEFERRAL ACCOUNT BALANCE. The benefit described in the Split Dollar Agreement and Endorsement attached to this Agreement as Addendum A shall terminate upon payment in full by the Company to the Director of the Deferral Account maintained by the Company for the Director under this Agreement.

ARTICLE 6

BENEFICIARIES

6.1 BENEFICIARY DESIGNATIONS. The Director shall designate a beneficiary by filing a written designation with the Company. The Director may revoke or modify the designation at any time by filing a new designation. However, designations will only be effective if signed by the Director and accepted by the Company during the Director’s lifetime. The Director’s beneficiary designation shall be deemed automatically revoked if the beneficiary predeceases the Director, or if the Director names a spouse as beneficiary and the marriage is subsequently dissolved. If the Director dies without a valid beneficiary designation, all payments shall be made to the Director’s surviving spouse, if any, and if none, to the Director’s surviving children and the descendants of any deceased child by right of representation, and if no children or descendants survive, to the Director’s estate.

6.2 FACILITY OF PAYMENT. If a benefit is payable to a minor, to a person declared incompetent, or to a person incapable of handling the disposition of his or her property, the Company may pay such benefit to the guardian, legal representative or person having the care or custody of such minor, incompetent person or incapable person. The Company may require proof of incompetency, minority or guardianship as it may deem appropriate prior to distribution of the benefit. Such distribution shall completely discharge the Company from all liability with respect to such benefit.

ARTICLE 7

GENERAL LIMITATIONS

7.1 INSURANCE. The Company may acquire an insurance policy on the life of the Director. The Company will be the owner and beneficiary of the policy.

7.2 SUICIDE. The Company shall not pay any benefit under this Agreement exceeding the Deferral Account if the Director commits suicide within three years after the date of this Agreement. In addition, the Company shall not pay any benefit under this Agreement if the Director has made any material misstatement of fact on a resume provided to the Company, or on any application for any benefits provided by the Company to the Director.

7.3 GENERAL. Notwithstanding anything to the contrary contained in this Agreement, the Director is entitled to only one benefit which shall be determined by the first event to occur which is dealt with by this Agreement. Subsequent occurrence of events dealt with by this Agreement shall not entitle the Director or his or her beneficiaries to other or further benefits under this Agreement.

7.4 TAX CONSEQUENCES. The Company does not insure or guarantee the tax consequences of payments provided hereunder for matters beyond its control, and the Director certifies that his decision to reduce and defer to receive his compensation is not due to any reliance upon financial, tax or legal advice given by the Company, and of its employees, agents, accountants or legal advisors.

7.5 TERMINATION FOR CAUSE. Notwithstanding any provision of this Agreement to the contrary, the Company shall not pay any benefit under this Agreement that is in excess of the Director’s Deferrals ( i.e. , the interest earned on the Deferred Account) if the Director’s Termination of Service results from Termination for Cause. The Director’s Deferrals shall be paid to the Director in a manner to be determined by the Company. No interest shall be credited on the Deferrals during any applicable installment period.

ARTICLE 8

CLAIMS AND REVIEW PROCEDURES

8.1 CLAIMS PROCEDURE. The Company shall notify any person or entity that makes a claim for benefits under this Agreement (the “Claimant”) in writing, within 90 days of Claimant’s written application for benefits, of his or her eligibility or noneligibility for benefits under the Agreement. If the Company determines that the Claimant is not eligible for benefits or full benefits, the notice shall set forth (a) the specific reasons for such denial, (b) a specific reference to the provisions of the Agreement on which the denial is based, (c) a description of any additional information or material necessary for the Claimant to perfect his or her claim, and a description of why it is needed, and (d) an explanation of the Agreement’s claims review procedure and other appropriate information as to the steps to be taken if the Claimant wishes to have the claim reviewed. If the Company determines that there are special circumstances requiring additional time to make a decision, the Company shall notify the Claimant of the special circumstances and the date by which a decision is expected to be made, and may extend the time for up to an additional 90 days.

8.2 REVIEW PROCEDURE. If the Claimant is determined by the Company not to be eligible for benefits, or if the Claimant believes that he or she is entitled to greater or different benefits, the Claimant shall have the opportunity to have such claim reviewed by the Company by filing a petition for review with the Company within 60 days after receipt of the notice issued by the Company. Said petition shall state the specific reasons, which the Claimant believes entitle him or her to benefits or to greater or different benefits. Within 60 days after receipt by the Company of the petition, the Company shall afford the Claimant (and counsel, if any) an opportunity to present his or her position to the Company verbally or in writing, and the Claimant (or counsel) shall have the right to review the pertinent documents. The Company shall notify the Claimant of its decision in writing within the 60-day period, stating specifically the basis of its decision, written in a manner to be understood by the Claimant and the specific provisions for the Agreement on which the decision is based. If, because of the need for a hearing, the sixty-day period is not sufficient, the decision may be deferred for up to another 60 days at the election of the Company, but notice of this deferral shall be given to the Claimant.

ARTICLE 9

AMENDMENTS AND TERMINATION

The Company may amend or terminate this Agreement at any time prior to the Director’s Termination of Service by written notice to the Director. In no event shall this Agreement be terminated without payment to the Director of the Deferral Account balance attributable to the Director’s Deferrals and interest credited on such amounts unless the Agreement terminates as a result of Termination for Cause in which event the Director forfeits the interest credited on the Director’s Deferrals.

ARTICLE 10

MISCELLANEOUS

10.1 BINDING EFFECT. This Agreement shall bind the Director and the Company, and their beneficiaries, successors and assigns, survivors, executors, administrators and transferees.

10.2 NO GUARANTEE OF SERVICE. This Agreement is not a contract for services. It does not give the Director the right to remain a director of the Company, nor does it interfere with the shareholders’ rights to replace the Director. It also does not require the Director to remain a director nor interfere with the Director’s right to terminate services at any time.

10.3 NON-TRANSFERABILITY. Benefits under this Agreement cannot be sold, transferred, assigned, pledged, attached or encumbered in any manner.

10.4 TAX WITHHOLDING. The Company shall withhold any taxes that are required to be withheld from the benefits provided under this Agreement.

10.5 APPLICABLE LAW. The Agreement and all rights hereunder shall be governed by the laws of California except to the extent preempted by the laws of the United States of America.

10.6 UNFUNDED ARRANGEMENT. The Director and beneficiary are general unsecured creditors of the Company for the payment of benefits under this Agreement. The benefits represent the mere promise by the Company to pay such benefits. The rights to benefits are not subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or garnishment by creditors. Any insurance on the Director’s life is a general asset of the Company to which the Director and beneficiary have no preferred or secured claim.

l0.7 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between the Company and the Director as to the subject matter hereof. No rights are granted to the Director by virtue of this Agreement other than those specifically set forth herein.

10.8 ADMINISTRATION. The Company shall have powers which are necessary to administer this Agreement, including but not limited to:

10.8.1 Interpreting the provisions of the Agreement;

10.8.2 Establishing and revising the method of accounting for the Agreement;

10.8.3 Maintaining a record of benefit payments; and

10.8.4 Establishing rules and prescribing any forms necessary or desirable to administer the Agreement.

10.9 NAMED FIDUCIARY. The Company shall be the named fiduciary and plan administrator under the Agreement. The named fiduciary may delegate to others certain aspects of the management and operation responsibilities of the plan including the service of advisors and the delegation of ministerial duties to qualified individuals.

IN WITNESS WHEREOF, the Director and a duly authorized Company officer have signed this Agreement.

	COMPANY:
DIRECTOR	CLOVIS COMMUNITY BANK

By:	By:
		Daniel J. Doyle
		Its:	President & Chief Executive Officer

EXHIBIT A

SECOND AMENDED AND RESTATED

DIRECTOR DEFERRED FEE AGREEMENT

Deferral Election

I elect to defer fees under my Second Amended and Restated Director Deferred Fee Agreement with CLOVIS COMMUNITY BANK, as follows:

Amount of Deferral		Frequency of Deferral		Duration
(Initial and Complete One)		(Initial One		(Initial One)
ý	I elect to defer 100% of Fees	o	Beginning of Year	o	This year only
o	I elect to defer $ of Fees	ý	Each fee period	o	For Years
o	I elect not to defer Fees	o	End of year	ý	Until Termination of Service
				o	Until ____________________ (date)

I understand that I may change the amount, frequency and duration of my deferrals by filing a new election form with CLOVIS COMMUNITY BANK and obtaining written approval of the Board of Directors of CLOVIS COMMUNITY BANK; provided, however, that any subsequent election will not be effective until the calendar year following the year in which the new election is received by CLOVIS COMMUNITY BANK.

Form of Benefit

I elect to receive benefits under the Agreement in the following form:

[Initial One]

Lump Sum

Equal monthly installments for One Hundred Twenty ( ) months

I understand that I may not change the form of benefit elected, even if I later change the amount of my deferrals under the Agreement without written approval of the Board of Directors of CLOVIS COMMUNITY BANK.

Beneficiary Designation

I designate the following as beneficiary of benefits under the Second Amended and Restated Director Deferred Fee Agreement payable following my death:

Primary:

Contingent:

NOTE: To name a trust as beneficiary, please provide the name of the trustee and the exact date of the trust agreement.

I understand that I may change these beneficiary designations by filing a new written designation with CLOVIS COMMUNITY BANK. I further understand that the designations will be automatically revoked if the beneficiary predeceases me, or, if I have named my spouse as beneficiary, in the event of the dissolution of our marriage.

Signature:

Date:			, 2002

Accepted by CLOVIS COMMUNITY BANK
this		day of		2002

By:
	Daniel J. Doyle
Title:	President & Chief Executive Officer

EXHIBIT 10.37

Schedule A

CLOVIS COMMUNITY BANK

SECOND AMENDED AND RESTATED

DIRECTOR DEFERRED FEE AGREEMENT

Participants’ Normal Retirement Age and Form of Benefit Elected

Participant	Normal Retirement Age	Form of Benefit Elected
Daniel N. Cunningham	75	Equal monthly installment for 60 months
Steven McDonald	63	Equal monthly installment for 120 months
Louis McMurray	65	Equal monthly installment for 120 months
Wanda Lee Rogers	75	Lump Sum
William S. Smittcamp	60	Lump Sum

EXHIBIT 10.38

Addendum A

Clovis Community Bank

Split Dollar Agreement and Endorsement

This Split Dollar Agreement and Endorsement is entered into as of this 13th day of February, 2002, by and between Clovis Community Bank (the “Bank”), a California-chartered bank located in Clovis, California and , a director of Clovis Community Bank (the “Director”). This Split Dollar Agreement and Endorsement shall append the Split Dollar Endorsement entered into on even date herewith, or as subsequently amended, by and between the aforementioned parties.

To encourage the Director to remain a member of the Bank’s board of directors, the Bank is willing to divide the death proceeds of a life insurance policy on the Director’s life. The Bank will pay life insurance premiums from its general assets.

Article 1

General Definitions

Capitalized terms not otherwise defined in this Split Dollar Agreement and Endorsement are used herein as defined in the Second Amended and Restated Director Deferred Fee Agreement dated as of February 13, 2002 . The following terms shall have the meanings specified:

“Insurer” means and Company.

“Policy” means insurance policy no. issued by and policy no. issued by

“Insured” means the Director.

Article 2

Policy Ownership Interests

2.1 Bank Ownership . The Bank is the sole owner of the Policy and shall have the right to exercise all incidents of ownership. The Bank shall be the beneficiary of any death proceeds remaining after the Director’s interest has been paid under Section 2.2 of this Split Dollar Agreement and Endorsement.

2.2 Executive’s Interest . The Director shall have the right to designate the beneficiary(ies) of death proceeds. After death of the Insured before Normal Retirement Age as defined in the Second Amended and Restated Director Deferred Fee Agreement, the Insured’s Beneficiary(ies) designated in accordance with the Split Dollar Policy Endorsement shall be entitled to an amount equal to $ , or one hundred percent (100%) of the net at risk insurance portion of the proceeds, whichever amount is less. The net at risk insurance portion is the total proceeds less the cash value of the Policy. If the Director dies after Normal Retirement Age as defined in the Second Amended and Restated Director Deferred Fee Agreement, the Insured’s beneficiaries shall be entitled to an amount equivalent to the Deferral Account maintained by the Bank for the Director as of the calendar year end of the year preceding the year of the Insured’s death, or one hundred percent (100%) of the net at risk insurance portion of the proceeds, whichever is less. The Director shall also have the right to elect and change settlement options specified in the Policy that may be permitted. However, the Director, the Director’s transferee and the Director’s beneficiary(ies) or estate shall have no rights or interests in the Policy for that portion of the death proceeds designated in this Section 2.2 if Termination of Service of the Director shall have previously occurred as a result of Termination for Cause under the Second Amended and Restated Director Deferred Fee Agreement.

2.3 Option to Purchase . The Bank shall not sell, surrender, or transfer ownership of the Policy while this Split Dollar Agreement and Endorsement is in effect without first giving the Director or the Director’s transferee a right of first refusal to purchase the Policy for the Policy’s interpolated terminal reserve value. The right of first refusal to purchase the Policy must be exercised within 60 days after the date the Bank gives written notice of the Bank’s intention to sell, surrender, or transfer ownership of the Policy. This provision shall not impair the right of the Bank to terminate this Split Dollar Agreement and Endorsement.

2.4 Comparable Coverage . Upon execution of this Agreement, the Bank shall maintain the Policy in full force and effect, and the Bank shall not amend, terminate or otherwise abrogate the Director’s interest in the Policy unless the Bank (a) replaces the Policy with a comparable insurance policy to cover the benefit provided under this Split Dollar Agreement and Endorsement and (b) executes a new Split Dollar Agreement and Endorsement and Endorsement for the comparable insurance policy. The Policy or any comparable policy shall be subject to the claims of the Bank’s creditors.

Article 3

Premiums

3.1 Premium Payment . The Bank shall pay any premiums due on the Policy.

3.2 Imputed Income . The Bank shall impute income to the Director in an amount equal to (a) the current term rate for the Director’s age, multiplied by (b) the net death benefit payable to the Director’s beneficiary(ies). The “current term rate” is the minimum amount required to be imputed under Revenue Rulings 64-328 and 66-110, or any subsequent applicable authority.

Article 4

Assignment

The Director may assign without consideration all interests in the Policy and in this Split Dollar Agreement to any person, entity or trust. If the Director transfers all of the Director’s interest in the Policy, then all of the Director’s interest in the Policy and in the Split Dollar Agreement and Endorsement shall be vested in the Director’s transferee, who shall be substituted as a party hereunder, and the Director shall have no further interest in the Policy or in this Split Dollar Agreement and Endorsement.

Article 5

Insurer

The Insurer shall be bound only by the terms of the Policy. Any payments the Insurer makes or actions it takes in accordance with the Policy shall fully discharge it from all claims, suits, and demands of all entities or persons. The Insurer shall not be bound by or be deemed to have notice of the provisions of this Split Dollar Agreement and Endorsement.

Article 6

Claims Procedure

6.1 Claims Procedure . The Bank shall notify in writing any person or entity making a claim under this Split Dollar Agreement and Endorsement (the “Claimant”) of his or her eligibility or ineligibility for benefits under this Split Dollar Agreement and Endorsement. The Bank shall provide the written notice within 90 days after Claimant’s written application for benefits. If the Bank determines that the Claimant is not eligible for benefits or full benefits, the notice shall set forth (a) the specific reasons for the denial, (b) a specific reference to the provisions of this Split Dollar Agreement and Endorsement on which denial is based, (c) a description of any additional information or material necessary for the Claimant to perfect his or her claim, and a description of why it is needed, and (d) an explanation of this Split Dollar Agreement and Endorsement’s claims review procedure and other appropriate information concerning the steps to be taken if the Claimant wishes to have the claim reviewed. If the Bank determines that there are special circumstances requiring additional time to make a decision, the Bank shall notify the Claimant of the special circumstances and the date by which a decision is expected to be made, extending the time for up to an additional 90 days.

6.2 Review Procedure . If the Bank determines that the Claimant is not eligible for benefits or full benefits, or if the Claimant believes that he or she is entitled to greater or different benefits, the Claimant shall have the opportunity to have his or her claim reviewed by the Bank by filing a petition for review with the Bank within 60 days after receipt of the written notice issued by the Bank. The Claimant’s petition shall state the specific reasons the Claimant believes entitle him or her to benefits or to greater or different benefits. Within 60 days after the Bank’s receipt of the petition, the Bank shall give the Claimant (and counsel, if any) an opportunity to present his or her position to the Bank verbally or in writing, and the Claimant (or counsel) shall have the right to review the pertinent documents. The Bank shall notify the Claimant of the Bank’s decision in writing within the 60-day period, stating specifically the basis of its decision and identifying the specific provisions of this Split Dollar Agreement and Endorsement on which the decision is based. If, because of the need for a hearing, the 60-day period is not sufficient, the decision may be deferred for up to another 60-day period at the election of the Bank, but notice of this deferral must be given to the Claimant.

Article 7

Amendments and Termination

7.1 Amendment . This Split Dollar Agreement and Endorsement may be amended only by a writing signed by the Bank and the Director.

7.2 Termination of Agreement . This Split Dollar Agreement and Endorsement shall terminate upon the occurrence of any of the following events:

(a) The Insured is discharged or removed from service as a director of the Bank for cause. The term “for cause” shall mean any of the following: (1) gross negligence or gross neglect of duties, (2) the commission of a felony or the commission of a misdemeanor involving moral turpitude, (3) fraud, disloyalty, dishonesty, or willful violation of any law or significant policy of the Bank committed in connection with the Director’s service and, in the Bank’s sole judgment, resulting in an adverse effect on the Bank, or

(b) Surrender, lapse, or other termination of the Policy by the Bank, or

(d) Payment in full by the Bank to the Director of the Deferral Account maintained by the Bank for that certain Second Amended and Restated Director Deferred Fee Agreement dated February 13, 2002 .

Article 8

Miscellaneous

8.1 Binding Effect . This Split Dollar Agreement and Endorsement shall bind the Director and the Bank and their beneficiaries, survivors, executors, administrators and transferees, and any Policy beneficiary.

8.2 No Guarantee of Employment . This Split Dollar Agreement and Endorsement is not an employment policy or contract. It does not give the Director the right to remain a director of the Bank, nor does it interfere with the right of the Bank’s stockholder(s) not to re-elect the Director or the right of the stockholder(s) or the board to remove an individual as a director of the Bank. This Split Dollar Agreement and Endorsement also does not require the Director to remain a director nor interfere with the Director’s right to terminate director service at any time.

8.3 Successors; Binding Agreement . By an assumption agreement in form and substance satisfactory to the Director, the Bank shall require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business or assets of the Bank to expressly assume and agree to perform this Split Dollar Agreement and Endorsement in the same manner and to the same extent that the Bank would be required to perform this Split Dollar Agreement and Endorsement if no succession had occurred. The Bank’s failure to obtain such an assumption agreement before succession becomes effective shall be considered a breach of the Split Dollar Agreement and Endorsement and shall entitle the Director to the Change of Control benefit payable under Section 4.4 of the Second Amended and Restated Director Deferred Fee Agreement between the Bank and the Director.

8.4 Applicable Law . The Split Dollar Agreement and Endorsement and all rights hereunder shall be governed by and construed according to the internal substantive laws of the State of California, disregarding principles of conflict of laws.

8.5 Entire Agreement . This Split Dollar Agreement and Endorsement and the Second Amended and Restated Director Deferred Fee Agreement constitute the entire agreement between the Bank and the Director concerning the subject matter hereof. No rights are granted to the Director under this Split Dollar Agreement and Endorsement other than those specifically set forth herein.

8.6 Administration . The Bank shall have all powers necessary to administer this Split Dollar Agreement and Endorsement, including but not limited to the power to :

(a) interpret the provisions of the Split Dollar Agreement and Endorsement,

(b) establish and revise the method of accounting for the Split Dollar Agreement and Endorsement,

(d) establish rules and prescribe forms necessary or desirable to administer the Split Dollar

Agreement.

8.7 Named Fiduciary . The Bank shall be the named fiduciary and plan administrator under this Split Dollar Agreement and Endorsement. The Bank may delegate to others certain aspects of management and operational responsibilities, including the employment of advisors and the delegation of ministerial duties to qualified individuals.

8.8 Severability . If for any reason any provision of this Split Dollar Agreement and Endorsement is held invalid, such invalidity shall not affect any other provision of this Split Dollar Agreement and Endorsement not held so invalid, and each such other provision shall continue in full force and effect to the full extent consistent with the law. If any provision of this Split Dollar Agreement and Endorsement is held invalid in part, such invalidity shall in no way affect the remainder of such provision not held so invalid, and the remainder of such provision together with all other provisions of this Split Dollar Agreement and Endorsement shall continue in full force and effect to the full extent consistent with the law.

8.9 Headings . The headings herein are included solely for convenience of reference and shall not affect the meaning or interpretation of any provision of this Split Dollar Agreement and Endorsement.

8.10 Notices . All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given if delivered by hand or mailed, certified or registered mail, return receipt requested, with postage prepaid, to the following addresses or to such other address as either party may designate by like notice.

(a)	If to the Bank, to:	Board of Directors
		Clovis Community Bank
		600 Pollasky Avenue
		P.O. Box 3030
		Clovis, California 93612

(b)	If to the Director, to:

and to such other or additional person or persons as either party shall have designated to the other party in writing by like notice.

In Witness Whereof , the Bank and the Director have signed this Split Dollar Agreement and Endorsement as of the date and year first written above.

The Director	CLOVIS COMMUNITY BANK

	By:
		Daniel J. Doyle
	Its:	President & Chief Executive Officer

Split Dollar Policy Endorsement

Clovis Community Bank

Policy No.

Insured:

Supplementing and amending the application for insurance to Company, (the “Insurer”) on , the applicant requests and directs that:

Beneficiaries

1. Clovis Community Bank, located in Clovis, California, shall be the beneficiary of any death proceeds remaining after the Insured’s interest has been paid under paragraph (2) below.

2. The Insured or the Insured’s transferee shall designate the beneficiary(ies) of death proceeds. After the death of the Insured before Normal Retirement Age as defined in the Second Amended and Restated Director Deferred Fee Agreement, the Insured’s Beneficiary(ies) shall be entitled to an amount equal to $ _________ , or one hundred percent (100%) of the net at risk insurance portion of the proceeds, whichever amount is less. The net at risk insurance portion is the total proceeds less the cash value of the Policy. If the Insured dies after Normal Retirement Age as defined in the Second Amended and Restated Director Deferred Fee Agreement, the Insured’s beneficiaries shall be entitled to an amount equivalent to the Deferral Account maintained by the Bank for the Insured as of the calendar year end of the year preceding the year of the Insured’s death, or one hundred percent (100%) of the net at risk portion of the proceeds, whichever amount is less. However, the Insured, the Insured’s transferee and the Insured’s beneficiary(ies) or estate shall have no rights or interests in the Policy for that portion of the death proceeds designated in this paragraph (2) if the Insured received payment in full of the Deferral Account from the Bank under the Second Amended and Restated Director Deferred Fee Agreement.

Ownership

3. The Owner of the Policy shall be Clovis Community Bank. The Owner shall have all ownership rights in the Policy except as may be specifically granted to the Insured or the Insured’s transferee in paragraph (4) of this endorsement.

4. The Insured or the Insured’s transferee shall have the right to assign his or her rights and interests in the Policy with respect to that portion of the death proceeds designated in paragraph (2) of this endorsement, and to exercise all settlement options with respect to such death proceeds.

5. Notwithstanding the provisions of paragraph (4) above, the Insured, the Insured’s transferee, or the Insured’s beneficiary(ies) or estate shall have no rights or interests in the Policy with respect to that portion of the death proceeds designated in paragraph (2) of this endorsement if the Insured’s service with Clovis Community Bank terminated because of Termination for Cause under the Second Amended and Restated Director Deferred Fee Agreement.

Modification of Assignment Provisions of the Policy

6. Upon the death of the Insured, the interest of any collateral assignee of the Owner of the Policy designated in (3) above shall be limited to the portion of the proceeds described in paragraph (1) above.

Owner ’ s Authority

7. The Insurer is hereby authorized to recognize the Owner’s claim to rights hereunder without investigating the reason for any action taken by the Owner, including the Owner’s statement of the amount of premiums the Owner has paid on the Policy. The signature of the Owner shall be sufficient for the exercise of any rights under this Endorsement and the receipt of the Owner for any sums received by it shall be a full discharge and release therefore to the Insurer. The Insurer may rely on a sworn statement in form satisfactory to it furnished by the Owner, its successors or assigns, as to their interest and any payments made pursuant to such statement shall discharge Clovis Community Bank accordingly.

8. Any transferee’s rights shall be subject to this Endorsement.

9. The Owner accepts and agrees to this split dollar endorsement.

10. The undersigned is signing in a representative capacity and warrants that he or she has the authority to bind the entity on whose behalf this document is being executed.

Signed by Clovis Community Bank at Clovis, California, this day of , 2002.

Clovis Community Bank

By:
	Daniel J. Doyle
Its:	President & Chief Executive Officer

The Insured accepts and agrees to the foregoing and, subject to the rights of the Owner as stated above, designates , (relationship: ) as primary beneficiary(s) and , (relationship: ) as secondary beneficiary of the portion of the proceeds described in (2) above.

Signed at Clovis, California, this day of , 2002.

The Insured

Exhibit 10.39

Schedule B

Clovis Community Bank Split Dollar Agreement and Endorsement

Participants and Their Executive Interest in Clovis Community Bank Split Dollar Agreement and Endorsement

Participant	Dates of signature	Executive Interest
Daniel N. Cunningham	May 15, 2002	$	424,366
Steven McDonald	May 15, 2002	$	422,416
Louis McMurray	May 15, 2002	$	379,127
Wanda Lee Rogers	May 15, 2002	$	250,167
William S. Smittcamp	May 15, 2002	$	422,416

EXHIBIT 10.40

CENTRAL VALLEY COMMUNITY BANK

EMPLOYEE AND DIRECTOR PREFERRED INTEREST BONUS PLAN

Central Valley Community Bank (the “Bank”) hereby establishes an employee bonus plan (the “Plan”), pursuant to which preferred limited liability company interests (“Preferred Interests”) in Central Valley Community Realty, LLC, a Delaware limited liability company (“CVC Realty”), are to be distributed to certain employees and directors of the Bank and its direct and indirect subsidiaries.

ARTICLE I
PURPOSE OF PLAN

CVC Realty is a recently formed indirect subsidiary of the Bank. The assets of CVC Realty will consist primarily of real estate related assets, including mortgage loan participations. It is expected that CVC Realty will reinvest the proceeds received upon repayment of the principal and interest of such assets in similar real estate related assets to the extent not otherwise distributed to the members of CVC Realty.

CVC Realty intends to conduct its operations so as to qualify as a real estate investment trust (a “REIT”) for Federal income tax purposes. As a condition to qualifying as a REIT, CVC Realty must have at least 100 equity owners. In order to meet this requirement, the Bank has decided to distribute Preferred Interests in CVC Realty to directors of the Bank and to certain key employees of the Bank as an employee benefit under the Plan.

ARTICLE II
DEFINITIONS

2.1 Administrator . The individual or individuals designated by the Board from time to time to administer the Plan. The initial Administrator shall be the Compensation Committee of the Bank.

2.2 Affiliate . Each corporation that is designated as an Affiliate by the Bank pursuant to Section 4.2.

2.3 Bank . Central Valley Community Bank, a California state bank , and its successors and assigns.

2.4 Board . The Board of Directors of the Bank.

2.5 CVC Realty Limited Liability Company Operating Agreement . The Limited Liability Company Operating Agreement of CVC Realty, as amended, restated or otherwise modified from time to time.

2.6 Code . The Internal Revenue Code of 1986, as amended.

2.7 Director . Each member of the Board.

2.8 Eligible Employee . An Employee of the Bank or an Affiliate who is compensated through the Bank’s or such Affiliate’s regular payroll, works full time (i.e., 40 hours per week) and who meets one of the following additional criteria:

(a) has the title of “Assistant Vice President or higher;” or

(b) has a Salary Grade of 5 or higher.

For purposes of the Plan, the employment relationship shall be treated as continuing intact while the individual is on sick leave or other leave of absence approved by the Bank.

2.9 Employee . An officer of the Bank and any other common law employee of the Bank or an Affiliate who is paid through the Bank’s or such Affiliate’s regular payroll.

2.10 CVC Realty . Central Valley Community Realty, LLC, a California limited liability company, and its successors and assigns.

2.11 Grant Date . Each date, as determined by the Administrator, upon which Preferred Interests are granted to one or more Directors and Eligible Employees who have elected to become Participants in accordance with Article III.

2.12 Joinder Agreement . An agreement, in substantially the form attached hereto as Attachment A, entered into between CVC Realty and a Director or an Eligible Employee, or an assignee of any Director or Employee, whereby such Director or Eligible Employee agrees to be bound by and subject to the terms of the CVC Realty Limited Liability Company Agreement.

2.13 Participant . A Director or an Eligible Employee who has elected to participate in the Plan in accordance with Article III.

2.14 Participation Agreement . An acceptance form, in substantially the form attached hereto as Attachment B, submitted by a Director or an Eligible Employee to the Administrator, whereby such Director or Eligible Employee elects to participate in the Plan.

2.15 Plan . The Central Valley Community Bank Employee Preferred Interest Bonus Plan, as amended, restated or otherwise modified from time to time.

2.16 Preferred Interests . Equity interests in CVC Realty designated as “Preferred Interests,” having the designations, preferences, rights and duties described in the CVC Realty Limited Liability Company Agreement, and a par value of $250 with a 6% preferred dividend.

Capitalized terms used, but not otherwise defined in, this Agreement shall have the same meaning as set forth in the CVC Realty Limited Liability Company Operating Agreement.

ARTICLE III
GRANT AND ACCEPTANCE OF PREFERRED INTERESTS

3.1 Participation and General Conditions . The Administrator shall provide written notice of eligibility, together with a copy of the Plan, the CVC Limited Liability Company Agreement, the Participation Agreement and the Joinder Agreement, to each Director and each Eligible Employee, not less than ten (10) days before the applicable Grant Date. Each Director and each Eligible Employee may elect to become a Participant by completing and duly executing (1) the Participation Agreement and (2) the Joinder Agreement and returning such completed and executed agreements to the Administrator before the applicable Grant Date. NO GRANT OF A PREFERRED INTEREST UNDER THE PLAN SHALL BE EFFECTIVE UNLESS AND UNTIL THE RELEVANT PARTICIPANT HAS DULY COMPLETED, EXECUTED AND DELIVERED TO THE ADMINISTRATOR THE PARTICIPATION AGREEMENT AND THE JOINDER AGREEMENT.

3.2 Grant of Preferred Interests . On each Grant Date, (1) each (a) Director and each Eligible Employee having the title of Assistant Vice President or higher and who has elected to become a Participant in accordance with Section 3.1 and (b) shall, without further action of the Administrator, be granted two Preferred Interests under the Plan, (2) each additional Eligible Employee who works full time (as defined in Section 2.8 above) shall, without further action of the Administrator, be granted one Preferred Interest under the Plan, and (3) the Bank shall direct CVC Realty to issue and deliver to each such Participant (or such Participant’s transferee), the applicable number of certificates representing the applicable number of Preferred Interests, registered in the name of such Participant or such Participant’s transferee, as the case may be.

3.3 Incorporation of Terms of the CVC Realty Limited Liability Company Agreement . The provisions of Articles VIII and IX of the CVC Realty Limited Liability Company Agreement shall be deemed incorporated herein.

ARTICLE IV
ADMINISTRATION OF THE PLAN

4.1 General Authority . The Plan shall be administered by the Administrator. The express grant in the Plan of any specific power to the Administrator shall not be construed as limiting any power or authority of the Administrator. The Administrator shall not be liable for any act done in good faith with respect to the Plan or any Participation Agreement or Joinder Agreement. The interpretation and construction by the Administrator of any terms or provisions of the Plan or of any rule or regulation promulgated in connection herewith shall, to the fullest extent permitted by law, be conclusive and binding on all persons. In addition to all other authority vested with the Administrator under the Plan, the Administrator shall have the discretionary authority to:

(a) Interpret all provisions of the Plan;

(b) Designate Employees as “Eligible Employees” for purposes of the Plan;

(d) Adopt, amend, or rescind rules for Plan administration; and

(e) Make all determinations it deems advisable for the administration of the Plan.

4.2 Indemnification of the Administrator . In addition to such other rights of indemnification as members of the Board, the Administrator shall be indemnified by the Bank against (1) the reasonable expenses (as such expenses are incurred), including attorneys’ fees actually and necessarily incurred in connection with the defense of any action, suit or proceeding (or in connection with any appeal therein), to which they or any of them may be a party by reason of any action taken or failure to act under or in connection with the Plan; and (2) against all amounts paid by them in settlement thereof (provided such settlement is approved by independent legal counsel selected by the Bank) or paid by them in satisfaction of a judgment in any such action, suit or proceeding, except in relation to matters as to which it shall be adjudged in such action, suit or proceeding that the Administrator is liable for gross negligence or misconduct in the performance of their duties; provided that within 60 days after institution of any such action, suit or proceeding the Administrator shall in writing offer the Bank the opportunity, at its own expense, to handle and defend the same.

4.3 Designation of Affiliates . The Bank may from time to time designate, a “parent” corporation, or a “majority-owned subsidiary” in each case within the meaning of such terms as used in Rule 701(b) promulgated by the Securities and Exchange Commission under the Securities Act of 1933, as amended, as an Affiliate for purposes of the Plan. Such designation shall be evidenced by the express inclusion of such corporation as an Affiliate within the meaning of Section 2.2, the intentional act of the Bank or the Administrator to communicate in writing the grant of Preferred Interests hereunder to employees of such corporation, or such other written document that is intended to evidence such designation. The Bank or Administrator may rescind the designation of a corporation as an Affiliate by adopting a writing that is intended to evidence such rescission.

ARTICLE V

PUT OPTIONS

5.1 General . Subject to the terms of this Section, at the sole option of the Participant, or, if applicable, the Participant’s assignee(s), heir(s), devisee(s), legal representative(s) or other successor(s) in interest (individually, an “Assignee,” and collectively, the “Assignee(s)”) the Bank agrees to repurchase the Preferred Interests of the Participant or the Participant’s Assignee(s) as the case may be, upon the happening of (a) the death of the Participant, (b) the death of the Assignee, (c) the termination of the Participant’s employment by the Bank for any reason other than death, or (d) if the Participant is a member of the Board of Directors of the Bank, upon the termination of later of (i) the termination of the Participant’s employment with the Bank, if applicable, or (ii) the termination of the Participant’s tenure of the Board of Directors of the Bank.

5.2 Exercise . The put option shall be exercised by the Participant and the Participant’s Assignee(s), as the case may be, providing written notice to the Bank on or before 30 days following the happening of any event described in Section 5.1 above.

5.3 Price and Terms . The option price shall be the sum of (a) $250 per Preferred Interest and (b) any accrued but unpaid Preferred Return in respect of the Preferred Interest computed as of the day of closing. The option price shall be payable in full in cash at closing, which shall occur as promptly as practicable after the receipt of notice by the Bank from the Participant or Participant’s Assignee(s), as the case may be.

5.4 Limitation . Notwithstanding any other provision of this Article V, the exercise of the put option granted in this Article V is expressly subject to the good faith determination by the Bank that such exercise will not have an adverse impact on the continuing status of the Company as a real estate investment trust (“REIT”) within the meaning of Section 856 et seq. of the Internal Revenue Code of 1986, as amended. The Bank shall have the power, in good faith, to postpone or refuse to consummate any purchase of Preferred Interests that would threaten the Company’s status as a REIT under the Code, or cause the Company to fail to meet the requirements of REIT status under the Code.

ARTICLE VI
GENERAL PROVISIONS

6.1 Effect on Employment . Neither the adoption of the Plan, its operation, nor any documents describing or referring to the Plan (or any part thereof) shall confer upon any employee any right to continue in the employ of the Bank or an Affiliate or in any way affect any right and power of the Bank or an Affiliate to terminate the employment of any employee at any time with or without assigning a reason therefor.

6.2 Costs . All costs and expenses incurred in administering the Plan shall be paid by the Bank.

6.3 Rules of Construction . Headings are given to the articles and sections of the Plan solely as a convenience to facilitate reference. The masculine gender when used herein refers to both masculine and feminine. The reference to any statute, regulation or other provision of law shall be construed to refer to any amendment to or successor of such provision of law.

6.4 Governing Law . The internal laws of the State of California shall apply to all matters arising under the Plan. The Plan is not intended to be subject to the Employee Retirement Income Security Act of 1974, as amended.

6.5 Amendment . The Board may amend the Plan at any time; provided, however, that, without the consent of such Participant, the Board may not amend the Plan in a manner that adversely affects the rights of a Participant under the Plan unless the Board shall have determined that changes in applicable accounting rules or a change in applicable laws renders such an amendment desirable, in which case the Board may approve such amendment.

6.6 Termination . The Board may terminate the Plan at any time or for any reason; provided, however, that no such termination may adversely affect the rights of any Participant with respect to previous grants of Preferred Interests under the Plan, unless the Board shall have determined that changes in applicable accounting rules or a change in applicable laws renders such termination desirable, in which case the Board may approve such termination. The Plan shall terminate upon the earliest to occur of (1) the termination of the Plan by the Board in accordance with this Section 5.6 or (2) fifteen (15) years from the effective date. The termination of the Plan shall be effected in accordance with procedures established by the Administrator.

6.7 Governmental Regulations . Notwithstanding anything to the contrary set forth herein, the Bank’s obligation to purchase and deliver Preferred Interests pursuant to the Plan is subject to all applicable laws, rules and regulations, including all applicable federal and state securities laws, and the obtaining of all such approvals of any governmental or regulatory authority as may be deemed necessary or appropriate by the Board.

IN WITNESS WHEREOF, the undersigned officer has duly executed the Plan this 17 ^th day of June, 2002, to be effective as of such date.

	CENTRAL VALLEY COMMUNITY BANK

	By:	/s/Daniel J. Doyle
	Name:	Daniel J. Doyle
	Title:	President & Chief Executive Officer

EXHIBIT 99.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the accompanying Quarterly Report of Central Valley Community Bancorp (“CVCB”) on Form 10-QSB for the quarter ended June 30, 2002 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Daniel J. Doyle, President and Chief Executive Officer of CVCB, hereby certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge and belief, that:

(1) the Report fully complies with the requirements of section 13(a) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of CVCB.

Dated: August 9, 2002

	/ s/Daniel J. Doyle

	DANIEL J. DOYLE

	President and Chief Executive Officer

EXHIBIT 99.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the accompanying Quarterly Report of Central Valley Community Bancorp (“CVCB”) on Form 10-QSB for the quarter ended June 30, 2002 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Gayle Graham, Chief Financial Officer of CVCB, hereby certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge and belief, that:

(1) the Report fully complies with the requirements of section 13(a) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of CVCB.

Dated: August 9, 2002

	/ s/Gayle Graham

	GAYLE GRAHAM

	Chief Financial Officer