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                                  EXHIBIT 10.3

                                ESCROW AGREEMENT

         THIS ESCROW AGREEMENT (this "Agreement") is entered into and effective
as of the 28th day of January, 2004, by and between Mountain Valley Bancshares,
Inc., a corporation (the "Company"), and The Bankers Bank (the "Escrow Agent").

                              W I T N E S S E T H:

         WHEREAS, the Company proposes to offer and sell (the "Offering") up to
1,000,000 shares of Common Stock, no par value per share (the "Shares"), to
investors at $10.00 per Share pursuant to a registered public offering; and

         WHEREAS, the Company desires to establish an escrow for funds forwarded
by subscribers for Shares, and the Escrow Agent is willing to serve as Escrow
Agent upon the terms and conditions herein set forth.

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

         1.       DEPOSIT WITH ESCROW AGENT.

                  (a)      The Escrow Agent agrees that it will from time to
         time accept, in its capacity as escrow agent, subscription funds for
         the Shares (the "Escrowed Funds") in the form of checks received by the
         Company from subscribers. All checks shall be made payable to the
         Escrow Agent. If any check does not clear normal banking channels in
         due course, the Escrow Agent will promptly notify the Company. Any
         check which does not clear normal banking channels and is returned by
         the drawer's bank to Escrow Agent will be promptly turned over to the
         Company along with all other subscription documents relating to such
         check. Any check received that is made payable to a party other than
         the Escrow Agent shall be returned to the Company for return to the
         proper party. The Company in its sole and absolute discretion may
         reject any subscription for shares for any reason and upon such
         rejection it shall notify and instruct the Escrow Agent in writing to
         return the Escrowed Funds by check made payable to the subscriber. If
         the Company rejects or cancels any subscription for any reason the
         Company will retain any interest earned on the Escrowed Funds to help
         defray organizational costs.

         (b)      Subscription agreements for the Shares shall be reviewed for
accuracy by the Company and, immediately thereafter, the Company shall deliver
to the Escrow Agent the following information: (i) the name and address of the
subscriber; (ii) the number of Shares subscribed for by such subscriber; (iii)
the subscription price paid by such subscriber; (iv) the subscriber's tax
identification number certified by such subscriber; and (v) a copy of the
subscription agreement.

         2.       INVESTMENT OF ESCROWED FUNDS. Upon collection of each check by
the Escrow Agent, the Escrow Agent shall invest the funds in deposit accounts or
certificates of deposit which are fully insured by the Federal Deposit Insurance
Corporation or another agency of the United States government, short-term
securities issued or fully guaranteed by the United States government, federal
funds, or such other investments as the Escrow Agent and the Company shall
agree. The Company shall provide the Escrow Agent with instructions from time to
time concerning in which of the specific investment instruments described above
the Escrowed Funds shall be invested, and the Escrow Agent shall adhere to such
instructions. Unless and until otherwise instructed by the Company, the Escrow
Agent shall by means of a "Sweep" or other automatic investment program invest
the Escrowed Funds in blocks of $1,000 in federal funds. Interest and other
earnings shall start accruing on such funds as soon as such funds would be
deemed to be available for access under applicable banking laws and pursuant to
the Escrow Agent's own banking policies.

         3.       DISTRIBUTION OF ESCROWED FUNDS. The Escrow Agent shall
distribute the Escrowed Funds in the

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amounts, at the times, and upon the conditions hereinafter set forth in this
Agreement.

         (a)      If at any time on or prior to the expiration date of the
offering as described in the prospectus relating to the offering, (the "Closing
Date"), (i) the Escrow Agent has certified to the Company in writing that the
Escrow Agent has received at least $7,000,000 in Escrowed Funds, and (ii) the
Escrow Agent has received a certificate from the President or the Chairman of
the Board of the Company that all other conditions to the release of funds as
described in the Company's Registration Statement filed with the Securities and
Exchange Commission pertaining to the public offering have been met, then the
Escrow Agent shall deliver the Escrowed Funds to the Company to the extent such
Escrowed Funds are collected funds. If any portion of the Escrowed Funds are not
collected funds, then the Escrow Agent shall notify the Company of such fact and
shall distribute such funds to the Company only after such funds become
collected funds. For purposes of this Agreement, "collected funds" shall mean
all funds received by the Escrow Agent, which have cleared normal banking
channels.

         (b)      If the Escrowed Funds do not, on or prior to the Closing Date,
become deliverable to the Company based on failure to meet the conditions
described in Paragraph 3(a), or if the Company terminates the offering at any
time prior to the Closing Date and delivers written notice to the Escrow Agent
of such termination (the "Termination Notice"), the Escrow Agent shall return
the Escrowed Funds which are collected funds as directed in writing by the
Company to the respective subscribers in amounts equal to the subscription
amount theretofore paid by each of them. All uncleared checks representing
Escrowed Funds which are not collected funds as of the Initial Closing Date
shall be collected by the Escrow Agent, and together with all related
subscription documents thereof shall be delivered to the Company by the Escrow
Agent, unless the Escrow Agent is otherwise specifically directed in writing by
the Company.

         4.       DISTRIBUTION OF INTEREST. Any interest earned on the Escrowed
Funds shall be retained by the Company.

         5.       FEE OF ESCROW AGENT. The escrow account will accrue a service
charge of $20.00 per month. In addition, a $20.00 per check fee will be charged
if the escrow account has to be refunded due to a failure to complete the
subscription. All of these fees are payable upon the release of the Escrowed
Funds, and the Escrow Agent is hereby authorized to deduct such fees from the
Escrowed Funds prior to any release thereof pursuant to Section 3 hereof.

         6.       LIABILITY OF ESCROW AGENT.

         (a)      In performing any of its duties under the Agreement, or upon
the claimed failure to perform its duties hereunder, the Escrow Agent shall not
be liable to anyone for any damages, losses or expenses which it may incur as a
result of the Escrow Agent so acting, or failing to act; provided, however, the
Escrow Agent shall be liable for damages arising out of its willful default or
misconduct or its gross negligence under this Agreement. Accordingly, the Escrow
Agent shall not incur any such liability with respect to (i) any action taken or
omitted to be taken in good faith upon advice of its counsel or counsel for the
Company which is given with respect to any questions relating to the duties and
responsibilities of the Escrow Agent hereunder; or (ii) any action taken or
omitted to be taken in reliance upon any document, including any written notice
or instructions provided for this Escrow Agreement, not only as to its due
execution and to the validity and effectiveness of its provisions but also as to
the truth and accuracy of any information contained therein, if the Escrow Agent
shall in good faith believe such document to be genuine, to have been signed or
presented by a proper person or persons, and to conform with the provisions of
this Agreement.

         (b)      The Company agrees to indemnify and hold harmless the Escrow
Agent against any and all losses, claims, damages, liabilities and expenses,
including, without limitation, reasonable costs of investigation and counsel
fees and disbursements which may be imposed by the Escrow Agent or incurred by
it in connection with its acceptance of this appointment as Escrow Agent
hereunder or the performance of its duties hereunder, including, without
limitation, any litigation arising from this Escrow Agreement or involving the
subject matter thereof; except, that if the Escrow Agent shall be found guilty
of willful misconduct or gross negligence under this Agreement, then, in that
event, the Escrow Agent shall bear all such losses, claims, damages and
expenses.

         (c)      If a dispute ensues between any of the parties hereto which,
in the opinion of the Escrow Agent, is

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sufficient to justify its doing so, the Escrow Agent shall retain legal counsel
of its choice as it reasonably may deem necessary to advise it concerning its
obligations hereunder and to represent it in any litigation to which it may be a
part by reason of this Agreement. The Escrow Agent shall be entitled to tender
into the registry or custody of any court of competent jurisdiction all money or
property in its hands under the terms of this Agreement, and to file such legal
proceedings as it deems appropriate, and shall thereupon be discharged from all
further duties under this Agreement. Any such legal action may be brought in any
such court as the Escrow Agent shall determine to have jurisdiction thereof. In
connection with such dispute, the Company shall indemnify the Escrow Agent
against its court costs and reasonable attorney's fees incurred.

         (d)      The Escrow Agent may resign at any time upon giving thirty
(30) days written notice to the Company. If a successor escrow agent is not
appointed by Company within thirty (30) days after notice of resignation, the
Escrow Agent may petition any court of competent jurisdiction to name a
successor escrow agent and the Escrow Agent herein shall be fully relieved of
all liability under this Agreement to any and all parties upon the transfer of
the Escrowed Funds and all related documentation thereto, including appropriate
information to assist the successor escrow agent with the reporting of earnings
of the Escrowed Funds to the appropriate state and federal agencies in
accordance with the applicable state and federal income tax laws, to the
successor escrow agent designated by the Company appointed by the court.

         7.       APPOINTMENT OF SUCCESSOR. The Company may, upon the delivery
of thirty (30) days written notice appointing a successor escrow agent to the
Escrow Agent, terminate the services of the Escrow Agent hereunder. In the event
of such termination, the Escrow Agent shall immediately deliver to the successor
escrow agent selected by the Company, all documentation and Escrowed Funds
including interest earnings thereon in its possession, less any fees and
expenses due to the Escrow Agent or required to be paid by the Escrow Agent to a
third party pursuant to this Agreement.

         8.       NOTICE. All notices, requests, demands and other
communications or deliveries required or permitted to be given hereunder shall
be in writing and shall be deemed to have been duly given three days after
having been deposited for mailing if sent by registered mail, or certified mail
return receipt requested, or delivery by courier, to the respective addresses
set forth below:

IF TO THE SUBSCRIBERS FOR SHARES:   To their respective addresses as specified
                                         in their Subscription Agreements.

THE COMPANY:

WITH A COPY TO:

THE ESCROW AGENT:                        The Bankers Bank
                                         2410 Paces Ferry Road
                                         600 Paces Summit
                                         Atlanta, GA 30339-4098
                                         Attention: Jo W. Avery
                                                    First Vice President

         9.       REPRESENTATIONS OF THE COMPANY. The Company hereby
acknowledges that the status of the Escrow Agent with respect to the offering of
the Shares is that of agent only for the limited purposes herein set forth, and
hereby agrees it will not represent or imply that the Escrow Agent, by serving
as the Escrow Agent hereunder or otherwise, has investigated the desirability or
advisability in an investment in the Shares, or has approved, endorsed or passed
upon the merits of the Shares, nor shall the Company use the name of the Escrow
Agent in any manner whatsoever in connection with the offer or sale of the
Shares, other than by acknowledgment that it has agreed to serve as Escrow Agent
for the limited purposes herein set forth.

         10.      GENERAL.

         (a) This Agreement shall be governed by and construed and enforced in
accordance with the laws of the

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State of Georgia.

         (b) The section headings contained herein are for reference purposes
only and shall not in any way affect the meaning or interpretation of this
Agreement.

         (c) This Agreement sets forth the entire agreement and understanding of
the parties with regard to this escrow transaction and supersedes all prior
agreements, arrangements and understandings relating to the subject matter
hereof.

         (d) This Agreement may be amended, modified, superseded or canceled,
and any of the terms or conditions hereof may be waived, only by a written
instrument executed by each party hereto or, in the case of a waiver, by the
party waiving compliance. The failure of any part at any time or times to
require performance of any provision hereof shall in no manner affect the right
at a later time to enforce the same. No waiver in any one or more instances by
any part of any condition, or of the breach of any term contained in this
Agreement, whether by conduct or otherwise, shall be deemed to be, or construed
as, a further or continuing waiver of any such condition or breach, or a waiver
of any other condition or of the breach of any other terms of this Agreement.

         (e) This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

         (f) This Agreement shall inure to the benefit of the parties hereto and
their respective administrators, successors and assigns. The Escrow Agent shall
be bound only by the terms of this Escrow Agreement and shall not be bound by or
incur any liability with respect to any other agreement or understanding between
the parties except as herein expressly provided. The Escrow Agent shall not have
any duties hereunder except those specifically set forth herein.

         (g) No interest in any part to this Agreement shall be assignable in
the absence of a written agreement by and between all the parties to this
Agreement, executed with the same formalities as this original Agreement.

         IN WITNESS WHEREOF, the parties have duly executed this Agreement as
the date first written above.

COMPANY:                                          ESCROW AGENT:

                                                  THE BANKERS BANK
By:   /s/ Marc J. Greene                    By:     /s/ Jo W. Avery
     --------------------                       --------------------------------
                                                        Jo W. Avery
                                                        First Vice President