**FORM      10-Q/A - 1**

| x | **QUARTERLY                REPORT PURSUANT TO SECTION 13 OR 15(d)****OF                THE SECURITIES EXCHANGE ACT OF                1934** |
|---|---------------------------------------------------------------------------------------------------------------------------------------------|

| **o** | **TRANSITION                REPORT PURSUANT TO SECTION 13 OR 15(d)****OF                THE SECURITIES EXCHANGE ACT OF                1934** |
|-------|----------------------------------------------------------------------------------------------------------------------------------------------|

**OREGON      PACIFIC BANCORP**

*(Exact      name of      Registrant as specified in its charter)*

|  **Oregon **                                                                                     |   |  **                 71-0918151**                  |
|------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------|
|  *(State                or other jurisdiction of  incorporation or                organization)* |   |  *(I.R.S.                Employer Identification No.)* |

**1355      Highway 101**

**Florence,      Oregon 97439**

*(Address      of      principal executive offices)*

**(541)      997-7121**

*(Registrant’s      telephone number)*

----

**Explanatory      Note**

| Item                1. | Consolidated                Statements of Cash Flows |   | Net                cash from                operating activities |
|------------------------|------------------------------------------------------|--------|------------------------------------------------------------------|

----

**OREGON      PACIFIC BANCORP**

**INDEX**

| Part                    I.  | Financial                    Information                                                                                   |                                                                                                                              |   |
|-----------------------------|----------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------|--------|
|                        | Item                    1.                                                                                                 | Financial                    Statements                                                                                           |   |
|                        |                                                                                                                       | Consolidated                    Balance Sheets                                                                                    | 4      |
|                        |                                                                                                                       | Consolidated                    Statements of Income and                    Comprehensive Income                                  | 5-6    |
|                        |                                                                                                                       | Consolidated                    Statements of Changes in                    Stockholders’ Equity                            | 7      |
|                        |                                                                                                                       | Consolidated                    Statements of Cash                    Flows                                                       | 8      |
|                        |                                                                                                                       | Notes                    to Consolidated Financial                    Statements                                                  | 9-11   |
|                        |                                                                                                                       |                                                                                                                              |   |
|                        | Item                    2.                                                                                                 | Management’s                    Discussion and Analysis of Financial Condition                    and Results of Operations |   |
|                        |                                                                                                                       |                                                                                                                              | 11-15  |
|                        |                                                                                                                       |                                                                                                                              |   |
|                        | Item                    3.                                                                                                 | Quantitive                    and Qualitive Disclosures about Market                    Risk                                      | 16     |
|                        |                                                                                                                       |                                                                                                                              |   |
|                        | Item                    4.                                                                                                 | Controls                    and Procedures                                                                                        | 16-17  |
|                        |                                                                                                                       |                                                                                                                              |   |
| Part                    II. |  Other                  Information                                                                                   | 17-18                                                                                                                             |
|                        |  Signatures                                                                                                           |  19                                                                                                                          |
|                        |  Exhibits                  and Certifications of Chief Executive                  Officer and Chief Financial Officer | 20-22                                                                                                                             |

----

| **PART                  I.  FINANCIAL INFORMATION**                                    |   |   |                            |   |   |
|---------------------------------------------------------------------------------------------|--------|--------|---------------------------------|--------|--------|
|                                                                                        |   |   |                            |   |   |
| **Item                  1.  Financial Statements**                                     |   |   |                            |   |   |
|                                                                                        |   |   |                            |   |   |
| **OREGON                  PACIFIC BANCORP**                                                 |   |
| **CONSOLIDATED                  BALANCE SHEETS**                                            |   |
| (Unaudited)                                                                                 |   |
|                                                                                        |   |   |                            |   |   |   |   |
|                                                                                        |   |   | JUNE                  30,  |   |   | DECEMBER                  31, |   |
| ASSETS                                                                                      |   |   | 2005                            |   |   | 2004 |   |
|                                                                                        |   |   |                            |   |   |   |   |
| Cash                  and due                  from banks                                   |   | $      | 5,307,357                       |   | $      | 4,341,385 |   |
| Interest-bearing                  deposits in banks                                         |   |   | 2,353,971                       |   |   | 873,806 |   |
| Available-for-sale                  securities, at fair value                               |   |   | 12,228,312                      |   |   | 15,424,419 |   |
| Restricted                  equity securities                                               |   |   | 1,023,100                       |   |   | 1,020,100 |   |
| Loans                  held                  for sale                                       |   |   | 1,554,917                       |   |   | 1,016,087 |   |
| Loans,                  net of                  allowance for loan losses and deferred fees |   |   | 116,158,452                     |   |   | 108,707,038 |   |
| Premises                  & equipment, net                                              |   |   | 5,068,273                       |   |   | 5,188,594 |   |
| Accrued                  interest and other assets                                          |   |   | 2,062,185                       |   |   | 1,677,458 |   |
|                                                                                        |   |   |                            |   |   |   |   |
| Total                  assets                                                               |   | $      | 145,756,567                     |   | $      | 138,248,887 |   |
|                                                                                        |   |   |                            |   |   |   |   |
|                                                                                        |   |   |                            |   |   |   |   |
| LIABILITIES                  AND STOCKHOLDERS' EQUITY                                       |   |   |                            |   |   |   |   |
|                                                                                        |   |   |                            |   |   |   |   |
| Deposits                                                                                    |   |   |                            |   |   |   |   |
| Demand                  deposits                                                            |   | $      | 29,693,750                      |   | $      | 26,591,202 |   |
| Interest-bearing                  demand deposits                                           |   |   | 43,703,825                      |   |   | 42,189,535 |   |
| Savings                  deposits                                                           |   |   | 18,954,028                      |   |   | 19,362,923 |   |
| Time                  certificate accounts:                                                 |   |   |                            |   |   |   |   |
| $100,000                  or                  more                                          |   |   | 11,929,443                      |   |   | 10,072,427 |   |
| Other                  time                  certificate accounts                           |   |   | 15,154,128                      |   |   | 12,844,634 |   |
|                                                                                        |   |   |                            |   |   |   |   |
| Total                  deposits                                                             |   |   | 119,435,174                     |   |   | 111,060,721 |   |
|                                                                                        |   |   |                            |   |   |   |   |
| Other                  liabilities                                                          |   |   |                            |   |   |   |   |
| Federal                  Home                  Loan Bank borrowings                         |   |   | 10,440,305                      |   |   | 11,867,806 |   |
| Floating                  rate                  Junior Subordinated Deferrable Interest     |   |   |                            |   |   |   |   |
| Debentures                  (Trust Preferred Securities)                                    |   |   | 4,124,000                       |   |   | 4,124,000 |   |
| Deferred                  compensation liability                                            |   |   | 1,340,278                       |   |   | 1,102,953 |   |
| Accrued                  interest and other liabilities                                     |   |   | 972,043                         |   |   | 1,201,110 |   |
|                                                                                        |   |   |                            |   |   |   |   |
| Total                  liabilities                                                          |   |   | 136,311,800                     |   |   | 129,356,590 |   |
|                                                                                        |   |   |                            |   |   |   |   |
| Stockholders'                  equity                                                       |   |   |                            |   |   |   |   |
| Common                  stock,                  no par value, 10,000,000 shares             |   |   |                            |   |   |   |   |
| authorized                  with 2,154,660 and 2,148,616 issued                             |   |   |                            |   |   |   |   |
| and                  outstanding at June 30, 2005 and                                       |   |   |                            |   |   |   |   |
| December                  31,                  2004, respectively                           |   |   | 4,746,633                       |   |   | 4,698,162 |   |
| Undivided                  profits                                                          |   |   | 4,565,439                       |   |   | 3,983,420 |   |
| Accumulated                  other comprehensive                                            |   |   |                            |   |   |   |   |
| income,                  net                  of tax                                        |   |   | 132,695                         |   |   | 210,715 |   |
|                                                                                        |   |   |                            |   |   |   |   |
| Total                  stockholders' equity                                                 |   |   | 9,444,767                       |   |   | 8,892,297 |   |
|                                                                                        |   |   |                            |   |   |   |   |
| Total                  liabilities and stockholders' equity                                 |   | $      | 145,756,567                     |   | $      | 138,248,887 |   |
|                                                                                        |   |   |                            |   |   |   |   |
| See                  accompanying notes                                                     |   |   |                            |   |   |   |   |

----

| **OREGON                  PACIFIC BANCORP**                                                      |   |
|--------------------------------------------------------------------------------------------------|--------|
| **CONSOLIDATED                  STATEMENTS OF INCOME AND                  COMPREHENSIVE INCOME** |   |
| (Unaudited)                                                                                      |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                             |   |   | Three                  Months Ended |   |   | Six                  Months Ended |   |
|                                                                                             |   |   | June                  30,  |   |   | June                  30, |   |
|                                                                                             |   |   | 2005 |   |   | 2004 |   |   | 2005 |   |   | 2004 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |
| INTEREST                  INCOME                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest                  and fees on loans                                                      |   | $ | 2,180,097 |   | $ | 1,706,234 |   | $ | 4,559,402 |   | $ | 3,359,243 |   |
| Interest                  on investment securities:                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| U.S.                  Teasuries and agencies                                                     |   |   | 28,951 |   |   | 69,897 |   |   | 87,920 |   |   | 119,259 |   |
| State                  and political subdivisions                                                |   |   | 80,161 |   |   | 77,507 |   |   | 160,973 |   |   | 156,717 |   |
| Corporate                  and other investments                                                 |   |   | 24,518 |   |   | 10,065 |   |   | 52,661 |   |   | 101,835 |   |
| Interest                  on deposits in banks                                                   |   |   | 31,870 |   |   | 26,244 |   |   | 46,895 |   |   | 44,386 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                  interest income                                                           |   |   | 2,345,597 |   |   | 1,889,947 |   |   | 4,907,851 |   |   | 3,781,440 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |
| INTEREST                  EXPENSE                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing                  demand deposits                                                |   |   | 176,396 |   |   | 88,088 |   |   | 289,994 |   |   | 174,142 |   |
| Savings                  deposits                                                                |   |   | 24,453 |   |   | 28,358 |   |   | 48,803 |   |   | 59,071 |   |
| Time                  deposits                                                                   |   |   | 175,345 |   |   | 105,240 |   |   | 308,796 |   |   | 215,069 |   |
| Other                  borrowings                                                                |   |   | 179,877 |   |   | 124,572 |   |   | 351,554 |   |   | 244,456 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                  interest expense                                                          |   |   | 556,071 |   |   | 346,258 |   |   | 999,147 |   |   | 692,738 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                  interest income                                                             |   |   | 1,789,526 |   |   | 1,543,689 |   |   | 3,908,704 |   |   | 3,088,702 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |
| PROVISION                  FOR LOAN LOSSES                                                       |   |   | 45,000 |   |   | - |   |   | 215,000 |   |   | (360,000 | ) |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                  interest income after                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| provision                  for loan losses                                                       |   |   | 1,744,526 |   |   | 1,543,689 |   |   | 3,693,704 |   |   | 3,448,702 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |
| NONINTEREST                  INCOME                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Mortgage                  loan sales and servicing fees                                          |   |   | 123,723 |   |   | 246,501 |   |   | 285,672 |   |   | 387,954 |   |
| Service                  charges and fees                                                        |   |   | 239,469 |   |   | 188,432 |   |   | 471,603 |   |   | 353,439 |   |
| Trust                  fee income                                                                |   |   | 156,368 |   |   | 124,747 |   |   | 302,172 |   |   | 267,809 |   |
| Investment                  sales commissions                                                    |   |   | 36,020 |   |   | 22,203 |   |   | 63,913 |   |   | 63,939 |   |
| Other                  income                                                                    |   |   | 28,953 |   |   | 58,765 |   |   | 126,711 |   |   | 77,978 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                  noninterest income                                                        |   |   | 584,533 |   |   | 640,648 |   |   | 1,250,071 |   |   | 1,151,119 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

| **OREGON                  PACIFIC BANCORP**                                     |   |
|---------------------------------------------------------------------------------|--------|
| **CONSOLIDATED                  STATEMENTS OF INCOME AND COMPREHENSIVE INCOME** |   |
| (Unaudited)                                                                     |   |
| (continued)                                                                     |   |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                            |   |   | Three                  Months Ended  |   |   | Six                  Months Ended |   |
|                                                                            |   |   | June                  30,  |   |   | June                  30, |   |
|                                                                            |   |   | 2005 |   |   | 2004 |   |   | 2005 |   |   | 2004 |   |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |
| NONINTEREST                  EXPENSE                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Salaries                  and benefits                                          |   | $ | 1,088,371 |   | $ | 1,195,477 |   | $ | 2,228,788 |   | $ | 2,405,915 |   |
| Occupancy                                                                       |   |   | 221,161 |   |   | 208,606 |   |   | 430,075 |   |   | 400,487 |   |
| Supplies                                                                        |   |   | 41,798 |   |   | 56,142 |   |   | 88,832 |   |   | 119,171 |   |
| Postage                  and freight                                            |   |   | 28,408 |   |   | 29,500 |   |   | 49,425 |   |   | 47,001 |   |
| Outside                  services                                               |   |   | 158,068 |   |   | 158,424 |   |   | 331,939 |   |   | 299,412 |   |
| Advertising                                                                     |   |   | 30,433 |   |   | 25,503 |   |   | 51,232 |   |   | 77,125 |   |
| Loan                  collection expense                                        |   |   | 14,695 |   |   | 36,150 |   |   | 28,543 |   |   | 67,988 |   |
| Securities                  and trust department expenses                       |   |   | 46,963 |   |   | 31,303 |   |   | 84,932 |   |   | 64,398 |   |
| Other                  expenses                                                 |   |   | 168,010 |   |   | 443,171 |   |   | 324,314 |   |   | 560,903 |   |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                  noninterest expense                                      |   |   | 1,797,907 |   |   | 2,184,276 |   |   | 3,618,080 |   |   | 4,042,400 |   |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |
| INCOME                  BEFORE INCOME TAXES                                     |   |   | 531,152 |   |   | 61 |   |   | 1,325,695 |   |   | 557,421 |   |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |
| PROVISION                  FOR INCOME TAXES                                     |   |   | 220,702 |   |   | (19,207 | ) |   | 529,785 |   |   | 171,301 |   |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |
| NET                  INCOME                                                     |   |   | 310,450 |   |   | 19,268 |   |   | 795,910 |   |   | 386,120 |   |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |
| OTHER                  COMPREHENSIVE INCOME                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Unrealized                  holding gain/(loss)                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |
| arising                  during the period, net of tax                          |   |   | 55,690 |   |   | (150,083 | ) |   | (78,020 | ) |   | (204,869 | ) |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |
| COMPREHENSIVE                  INCOME                                           |   | $ | 366,140 |   | $ | (130,815 | ) | $ | 717,890 |   | $ | 181,251 |   |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |
| EARNINGS                  PER SHARE OF                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |
| COMMON                  STOCK                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                  earnings per share                                       |   | $ | 0.14 |   | $ | 0.01 |   | $ | 0.37 |   | $ | 0.18 |   |
| Diluted                  earnings per share                                     |   | $ | 0.14 |   | $ | 0.01 |   | $ | 0.37 |   | $ | 0.18 |   |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |
| WEIGHTED                  AVERAGE COMMON                                        |   |   |   |   |   |   |   |   |   |   |   |   |   |
| SHARES                  OUTSTANDING                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                  earnings per share                                       |   |   | 2,152,253 |   |   | 2,180,006 |   |   | 2,149,998 |   |   | 2,177,947 |   |
| Diluted                  earnings per share                                     |   |   | 2,158,574 |   |   | 2,182,251 |   |   | 2,155,300 |   |   | 2,180,065 |   |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |
| See                  accompanying notes                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

| **OREGON                  PACIFIC BANCORP**                                                      |   |
|--------------------------------------------------------------------------------------------------|--------|
| **CONSOLIDATED                  STATEMENTS OF CHANGES IN                  STOCKHOLDERS' EQUITY** |   |
| **(Unaudited)**                                                                                  |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   | Accumulated  |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   | Other  |   |   | Total |   |
|                                                                                             |   |   | Common                  Stock  |   |   | Undivided |   |   | Comprehensive |   |   | Stockholders' |   |
|                                                                                             |   |   | Shares  |   |   | Amount |   |   | Profits |   |   | Income |   |   | Equity |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance,                  December 31, 2003                                                      |   |   | 2,173,592 |   | $ | 4,894,536 |   | $ | 3,331,170 |   | $ | 409,852 |   | $ | 8,635,558 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Shares                  acquired in stock repurchase plan                                        |   |   | (46,275 | ) |   | (344,714 | ) |   | - |   |   | - |   |   | (344,714 | ) |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash                  dividends paid                                                             |   |   | - |   |   | - |   |   | (266,130 | ) |   | - |   |   | (266,130 | ) |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Dividends                  reinvested in stock                                                   |   |   | 21,299 |   |   | 148,340 |   |   | (148,340 | ) |   | - |   |   | - |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                  income                  and comprehensive income                            |   |   | - |   |   | - |   |   | 1,066,720 |   |   | (199,137 | ) |   | 867,583 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance,                  December 31, 2004                                                      |   |   | 2,148,616 |   | $ | 4,698,162 |   | $ | 3,983,420 |   | $ | 210,715 |   | $ | 8,892,297 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Shares                  acquired in stock repurchase plan                                        |   |   | (4,300 | ) |   | (31,610 | ) |   | - |   |   | - |   |   | (31,610 | ) |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Sale                  of                  nonregistered stock                                    |   |   | 137 |   |   | 1,003 |   |   | - |   |   | - |   |   | 1,003 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash                  dividends paid                                                             |   |   | - |   |   | - |   |   | (134,813 | ) |   | - |   |   | (134,813 | ) |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Dividends                  reinvested in stock                                                   |   |   | 10,207 |   |   | 79,078 |   |   | (79,078 | ) |   | - |   |   | - |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                  income                  and comprehensive income                            |   |   | - |   |   | - |   |   | 795,910 |   |   | (78,020 | ) |   | 717,890 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance,                  June                  30, 2005                                         |   |   | 2,154,660 |   | $ | 4,746,633 |   | $ | 4,565,439 |   | $ | 132,695 |   | $ | 9,444,767 |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| See                  accompanying notes                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

| **OREGON                  PACIFIC BANCORP**                                                           |   |
|-------------------------------------------------------------------------------------------------------|--------|
| **CONSOLIDATED                  STATEMENTS OF CASH                  FLOWS**                           |   |
| (Unaudited)                                                                                           |   |
|                                                                                                  |   | Six                  Months                  Ended June 30, |   |
|                                                                                                  |   | 2005 |   | 2004 |   |
|                                                                                                  |   |   |   |   |   |
| CASH                  FLOWS                  FROM OPERATING ACTIVITIES                                |   |   |   |   |   |
|                                                                                                  |   |   |   |   |   |
| Net                  income                                                                           |   |  $ | 795,910  |   |  $ | 386,120  |   |
| Adjustments                  to reconcile net income to net cash                                      |   |   |   |   |   |   |   |
| from                  operating activities:                                                           |   |   |   |   |   |   |   |
| Depreciation                  and amortization                                                        |   |   | 240,408 |   |   | 221,494 |   |
| Provision                  (benefit) for loan losses                                                  |   |   | 215,000 |   |   | (360,000 | ) |
| Federal                  Home                  Loan Bank stock dividends                              |   |   | (3,000 | ) |   | (14,500 | ) |
| Net                  change in                  mortgage loans held-for-sale                          |   |   | (538,830 | ) |   | 2,160,466 |   |
| Gain                  on                  disposition of premises, equipment, and other real estate   |   |   | - |   |   | (22,725 | ) |
| Net                  increase                  in accrued interest and other assets                   |   |   | (332,713 | ) |   | (254,160 | ) |
| Net                  increase                  (decrease) in accrued interest and other liabilities   |   |   | 8,257 |   |   | (95,417 | ) |
|                                                                                                  |   |   |   |   |   |   |   |
| Net                  cash from                  operating activities                                  |   |   | 385,032 |   |   | 2,021,278 |   |
|                                                                                                  |   |   |   |   |   |   |   |
| CASH                  FLOWS                  FROM INVESTING ACTIVITIES                                |   |   |   |   |   |   |   |
| Proceeds                  from                  sales and maturities of available-for-sale securities |   |   | 3,058,836 |   |   | 6,451,637 |   |
| Purchases                  of                  available-for-sale-securities                          |   |   | - |   |   | (4,185,643 | ) |
| Net                  (increase) decrease in interest-bearing deposits in banks                        |   |   | (1,480,165 | ) |   | 758,749 |   |
| Loans                  originated, net of principal repayments                                        |   |   | (7,666,414 | ) |   | (13,961,799 | ) |
| Purchase                  of                  premises and equipment                                  |   |   | (112,850 | ) |   | (647,127 | ) |
| Proceeds                  from                  sale of other real estate                             |   |   | - |   |   | 23,049 |   |
|                                                                                                  |   |   |   |   |   |   |   |
| Net                  cash from                  investing activities                                  |   |   | (6,200,593 | ) |   | (11,561,134 | ) |
|                                                                                                  |   |   |   |   |   |   |   |
| CASH                  FLOWS                  FROM FINANCING ACTIVITIES                                |   |   |   |   |   |   |   |
| Net                  increase                  in demand and savings deposit accounts                 |   |   | 4,207,943 |   |   | 9,729,412 |   |
| Net                  increase                  (decrease) in time deposits                            |   |   | 4,166,510 |   |   | (138,096 | ) |
| Proceeds                  from                  Federal Home Loan Bank borrowings                     |   |   | 4,000,000 |   |   | 2,000,000 |   |
| Repayment                  of                  Federal Home Loan Bank borrowings                      |   |   | (5,427,501 | ) |   | (27,500 | ) |
| Proceeds                  from                  other bank borrowing                                  |   |   | - |   |   | 124,000 |   |
| Cash                  dividends paid                                                                  |   |   | (134,813 | ) |   | (126,474 | ) |
| Shares                  acquired in stock repurchase plan                                             |   |   | (31,610 | ) |   | - |   |
| Proceeds                  for                  issuance of common stock                               |   |   | 1,003 |   |   | - |   |
|                                                                                                  |   |   |   |   |   |   |   |
| Net                  cash from                  financing activities                                  |   |   | 6,781,532 |   |   | 11,561,342 |   |
|                                                                                                  |   |   |   |   |   |   |   |
| NET                  INCREASE                  IN CASH AND CASH EQUIVALENTS                           |   |   | 965,972 |   |   | 2,021,486 |   |
|                                                                                                  |   |   |   |   |   |   |   |
| CASH                  AND CASH                  EQUIVALENTS, beginning of period                      |   | $ | 4,341,385 |   | $ | 4,916,985 |   |
|                                                                                                  |   |   |   |   |   |   |   |
| CASH                  AND CASH                  EQUIVALENTS, end of period                            |   | $ | 5,307,357 |   | $ | 6,938,471 |   |
|                                                                                                  |   |   |   |   |   |   |   |
| SCHEDULE                  OF                  NONCASH ACTIVITIES                                      |   |   |   |   |   |   |   |
| Stock                  dividends reinvested                                                           |   | $ | 79,078 |   | $ | 69,372 |   |
| Unrealized                  (loss) gain on available for sale securities, net of tax                  |   | $ | (78,020 | ) | $ | (204,869 | ) |
| Additions                  to                  other real estate owned                                |   | $ | - |   | $ | 251,927 |   |
|                                                                                                  |   |   |   |   |   |   |   |
| See                  accompanying notes                                                               |   |   |   |   |   |   |   |

----

Notes      to Financial Statements 

|                                                               |   |            |       |         |   | Gross                      |   | Gross                      |    |         |   |
|--------------------------------------------------------------------|--------|-----------------|------------|--------------|--------|----------------------------|--------|----------------------------|---------|--------------|--------|
|                                                               |   |            |       |         |   | Unrealized                 |   | Unrealized                 |    |         |   |
|                                                               |   |            |       | Gross   |   | Losses                     |   | Losses                     |    | Estimated    |   |
|                                                               |   | Amortized  |       | Unrealized   |   | Less                  than |   | More                  than |    | Fair         |   |
|                                                               |   | Cost            |       | Gains        |   | 12                  Months |   | 12                  Months |    | Value        |   |
| June                  30,                  2005:                   |   |       |       |    |   |                  |   |                  |    |    |   |
|                                                               |   |       |       |    |   |                  |   |                  |    |    |   |
| U.S.                  Treasury                  and agencies       |   | $               | 4,000,000  |         | $      | -                          |   | $                          | (31,563 | )            | $      | - |   | $ | 3,968,437 |   |
| State                  and                  political subdivisions |   |            | 7,291,041  |         |   | 228,195                    |   |                       | (1,859  | )            |   | (1,988 | ) | $ | 7,515,389 |   |
| Corporate                  notes                                   |   |            | 716,113    |         |   | 28,373                     |   |                       | -       |         |   | - |   | $ | 744,486 |   |
|                                                               |   |            |       |         |   |                       |   |                       |    |         |   |   |   |   |   |   |
|                                                               |   | $               | 12,007,154 |         | $      | 256,568                    |   | $                          | (33,422 | )            | $      | (1,988 | ) | $ | 12,228,312 |   |
|                                                               |   |            |       |         |   |                       |   |                       |    |         |   |   |   |   |   |   |
|                                                               |   |            |       |         |   |                       |   |                       |    |         |   |   |   |   |   |   |
| December                  31,                  2004:               |   |            |       |         |   |                       |   |                       |    |         |   |   |   |   |   |   |
|                                                               |   |            |       |         |   |                       |   |                       |    |         |   |   |   |   |   |   |
| U.S.                  Treasury                  and agencies       |   | $               | 5,999,145  |         | $      | -                          |   | $                          | (16,296 | )            | $      | - |   | $ | 5,982,849 |   |
| State                  and                  political subdivisions |   |            | 7,481,028  |         |   | 304,683                    |   |                       | (1,562  | )            |   | - |   |   | 7,784,149 |   |
| Corporate                  notes                                   |   |            | 1,593,054  |         |   | 64,367                     |   |                       | -       |         |   | - |   |   | 1,657,421 |   |
|                                                               |   |            |       |         |   |                       |   |                       |    |         |   |   |   |   |   |   |
|                                                               |   | $               | 15,073,227 |         | $      | 369,050                    |   | $                          | (17,858 | )            | $      | - |   | $ | 15,424,419 |   |

----

|                                                                                                                            |   | JUN.                  30,                  2005 |                                                  | DEC.                  31,                  2004 |   |
|---------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------|-------------------------------------------------------|-------------------------------------------------|--------|
|                                                                                                                            |   |                                            |                                                  |                                            |   |
| Real                  estate                                                                                                    |   | $                                               | 16,449,457                                            |                                            | $      | 16,821,917 |   |
| Commercial                                                                                                                      |   |                                            | 94,865,770                                            |                                            |   | 87,338,080 |   |
| Installment                                                                                                                     |   |                                            | 7,127,465                                             |                                            |   | 6,644,550 |   |
| Overdrafts                                                                                                                      |   |                                            | 43,069                                                |                                            |   | 51,564 |   |
|                                                                                                                            |   |                                            |                                                  |                                            |   |   |   |
|                                                                                                                            |   |                                            | 118,485,761                                           |                                            |   | 110,856,111 |   |
| Allowance                  for                  loan losses                                                                     |   |                                            | (1,857,202                                            | )                                               |   | (1,640,060 | ) |
| Unearned                  loan                  fees                                                                            |   |                                            | (470,107                                              | )                                               |   | (509,013 | ) |
|                                                                                                                            |   | $                                               | 116,158,452                                           |                                            | $      | 108,707,038 |   |
|                                                                                                                            |   |                                            |                                                  |                                            |   | 108707038 |   |
| Changes                in                the allowance for loan losses were as follows for the six-months                ended: |   |
|                                                                                                                            |   |                                            |                                                  |                                            |   |   |   |
|                                                                                                                            |   |                                            | JUN.                  30,                  2005  |                                            |   | JUN.                  30,                  2004 |   |
|                                                                                                                            |   |                                            |                                                  |                                            |   |   |   |
| Balance,                  beginning of the period                                                                               |   | $                                               | 1,640,060                                             |                                            | $      | 1,315,955 |   |
| Provision                  for                  losses                                                                          |   |                                            | 215,000                                               |                                            |   | (360,000 | ) |
| Losses                                                                                                                          |   |                                            | (1,569                                                | )                                               |   | (34,275 | ) |
| Recoveries                                                                                                                      |   |                                            | 3,711                                                 |                                            |   | 720,075 |   |
|                                                                                                                            |   |                                            |                                                  |                                            |   |   |   |
| Balance,                  end                  of period                                                                        |   | $                                               | 1,857,202                                             |                                            | $      | 1,641,755 |   |
|                                                                                                                            |   |                                            |                                                  |                                            |   |   |   |
|                                                                                                                            |   |                                            |                                                  |                                            |   |   |   |

----

* *

|                                                                                |   | Three                  Months                  Ended |                            | Six                  Months                  Ended |   |
|-------------------------------------------------------------------------------------|--------|------------------------------------------------------|---------------------------------|----------------------------------------------------|--------|
|                                                                                |   |                                                 | June                  30,  |                                               |   | June                  30, |   |
|                                                                                |   |                                                 | 2005                            |                                               |   | 2004 |   |   | 2005 |   |   | 2004 |   |
|                                                                                |   |                                                 |                            |                                               |   |   |   |   |   |   |   |   |   |
| Net                  earnings,                  as reported                         |   | $                                                    | 310,450                         |                                               | $      | 19,268 |   | $ | 795,910 |   | $ | 386,120 |   |
| Deduct:                  Total                  stock-based employee compensation   |   |                                                 |                            |                                               |   |   |   |   |   |   |   |   |   |
| expense                  determined under the fair value-based                      |   |                                                 |                            |                                               |   |   |   |   |   |   |   |   |   |
| method                  for                  all awards, net of related tax effects |   |                                                 | (121                            | )                                                  |   | (121 | ) |   | (242 | ) |   | (242 | ) |
|                                                                                |   |                                                 |                            |                                               |   |   |   |   |   |   |   |   |   |
| Pro                  forma net                  earnings                            |   | $                                                    | 310,329                         |                                               | $      | 19,147 |   | $ | 795,668 |   | $ | 385,878 |   |
|                                                                                |   |                                                 |                            |                                               |   |   |   |   |   |   |   |   |   |
| Basic                  earnings per common share:                                   |   |                                                 |                            |                                               |   |   |   |   |   |   |   |   |   |
| As                  reported                                                        |   | $                                                    | 0.14                            |                                               | $      | 0.01 |   | $ | 0.37 |   | $ | 0.18 |   |
| Pro                  forma                                                          |   | $                                                    | 0.14                            |                                               | $      | 0.01 |   | $ | 0.37 |   | $ | 0.18 |   |
|                                                                                |   |                                                 |                            |                                               |   |   |   |   |   |   |   |   |   |
| Diluted                  earnings per common share:                                 |   |                                                 |                            |                                               |   |   |   |   |   |   |   |   |   |
| As                  reported                                                        |   | $                                                    | 0.14                            |                                               | $      | 0.01 |   | $ | 0.37 |   | $ | 0.18 |   |
| Pro                  forma                                                          |   | $                                                    | 0.14                            |                                               | $      | 0.01 |   | $ | 0.37 |   | $ | 0.18 |   |
|                                                                                |   |                                                 |                            |                                               |   |   |   |   |   |   |   |   |   |

|                                                    |   | 2005   |   | 2004   |   |
|---------------------------------------------------------|--------|--------|--------|--------|--------|
|                                                    |   |   |   |   |   |
| Dividend                  yield                         |   |   | 2.44   | %      |   | 2.25 | % |
| Expected                  life                  (years) |   |   | 7.5    |   |   | 7.5 |   |
| Expected                  volatility                    |   |   | 14.39  | %      |   | 19.72 | % |
| Risk-free                  rate                         |   |   | 4.50   | %      |   | 3.75 | % |

**Item        2. Management’s Discussion and Analysis of Financial Condition        and Results of Operations**

----

**Limitations        on the Effectiveness of Controls**

**Overview**

----

**Financial      Condition**

**Results      of      Operations**

*Average      Balances and Average Rates Earned and Paid. *

----

|                                             |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |
|--------------------------------------------------|--------|----------------------------------------------------------------------------------------|---------------|-------------------------------------------------------|--------|--------------------------------------------|--------|--------|---------------------------|--------|--------|---------|--------|--------|----------------------------|--------|--------|---------------------------|--------|
|                                             |   |                  Six                  Months                  Ended June 30, 2005 |          |  Six                  Months Ended June 30, 2004 |   |  Increase                  (Decrease) |   |
|                                             |   |                                                                                   |          |                                                  |   | Interest                              |   |   | Average                   |   |   |    |   |   | Interest                   |   |   | Average                   |   |   |   |   |   |   |   |   |   |   |
|                                             |   |                                                                                   | Average  |                                                  |   | Income                  or                 |   |   | Yield                  or |   |   | Average |   |   | Income                  or |   |   | Yield                  or |   |   | Due                  to change                  in |   |   | Net |   |
| **(dollars                  in thousands)**      |   |                                                                                   | Balance       |                                                  |   | Expense                                    |   |   | Rates                     |   |   | Balance |   |   | Expense                    |   |   | Rates                     |   |   | Volume |   |   | Rate |   |   | Change |   |
| Interest-earning                  assets:        |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| Loans(1)                                         |   | $                                                                                      | 115,346       |                                                  | $      | 4,182                                      |   |   | 7.25                      | %      | $      | 92,349  |   | $      | 3,359                      |   |   | 7.27                      | %      | $ | 836 |   | $ | (13 | ) | $ | 823 |   |
| Investment                  securities           |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| Taxable                  securities              |   |                                                                                   | 7,888         |                                                  |   | 145                                        |   |   | 3.68                      | %      |   | 8,290   |   |   | 233                        |   |   | 5.62                      | %      |   | (11 | ) |   | (77 | ) |   | (88 | ) |
| Nontaxable                  securities (2)       |   |                                                                                   | 7,255         |                                                  |   | 238                                        |   |   | 6.56                      | %      |   | 6,698   |   |   | 220                        |   |   | 6.56                      | %      |   | 18 |   |   | (0 | ) |   | 18 |   |
| Interest-earning                  balances due   |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| from                  banks                      |   |                                                                                   | 3,464         |                                                  |   | 47                                         |   |   | 2.71                      | %      |   | 9,786   |   |   | 44                         |   |   | 0.90                      | %      |   | (28 | ) |   | 31 |   |   | 3 |   |
| Total                  interest-earning          |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| assets                                      |   |                                                                                   | 133,953       |                                                  |   | 4,612                                      |   |   | 6.89                      | %      |   | 117,123 |   |   | 3,856                      |   |   | 6.58                      | %      |   | 815 |   |   | (59 | ) |   | 756 |   |
|                                             |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| Cash                  and due from banks         |   |                                                                                   | 4,388         |                                                  |   |                                       |   |   |                      |   |   | 4,849   |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| Premises                  and equipment, net     |   |                                                                                   | 5,147         |                                                  |   |                                       |   |   |                      |   |   | 4,992   |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| Other                  real estate               |   |                                                                                   | 0             |                                                  |   |                                       |   |   |                      |   |   | 49      |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| Loan                  loss allowance             |   |                                                                                   | (1,774        | )                                                     |   |                                       |   |   |                      |   |   | (1,471  | )      |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| Other                  assets                    |   |                                                                                   | 5,814         |                                                  |   |                                       |   |   |                      |   |   | 5,764   |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
|                                             |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| Total                  assets                    |   | $                                                                                      | 147,528       |                                                  |   |                                       |   |   |                      |   | $      | 131,306 |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
|                                             |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing                  liabilities:   |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing                  checking and   |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| savings                  accounts                |   | $                                                                                      | 61,436        |                                                  | $      | 339                                        |   |   | 1.10                      | %      | $      | 58,981  |   | $      | 233                        |   |   | 0.79                      | %      | $ | 10 |   | $ | 96 |   | $ | 106 |   |
| Time                  deposit and IRA accounts   |   |                                                                                   | 24,376        |                                                  |   | 309                                        |   |   | 2.54                      | %      |   | 20,141  |   |   | 215                        |   |   | 2.13                      | %      |   | 45 |   |   | 49 |   |   | 94 |   |
| Borrowed                  funds                  |   |                                                                                   | 15,856        |                                                  |   | 351                                        |   |   | 4.43                      | %      |   | 12,555  |   |   | 244                        |   |   | 3.89                      | %      |   | 64 |   |   | 43 |   |   | 107 |   |
| Total                  interest-bearing          |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| liabilities                                 |   |                                                                                   | 101,668       |                                                  |   | 999                                        |   |   | 1.97                      | %      |   | 91,677  |   |   | 692                        |   |   | 1.51                      | %      |   | 119 |   |   | 188 |   |   | 307 |   |
| Noninterest-bearing                              |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| deposits                                    |   |                                                                                   | 29,996        |                                                  |   |                                       |   |   |                      |   |   | 24,937  |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| Other                  liabilities               |   |                                                                                   | 2,653         |                                                  |   |                                       |   |   |                      |   |   | 1,981   |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| Total                  liabilities          |   |                                                                                   | 134,317       |                                                  |   |                                       |   |   |                      |   |   | 118,595 |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| Shareholders’                  equity      |   |                                                                                   | 13,211        |                                                  |   |                                       |   |   |                      |   |   | 12,711  |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
|                                             |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| Total                  liabilities and share-    |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| holders’                  equity      |   | $                                                                                      | 147,528       |                                                  |   |                                       |   |   |                      |   | $      | 131,306 |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
|                                             |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| Net                  interest income             |   |                                                                                   |          |                                                  | $      | 3,613                                      |   |   |                      |   |   |    |   | $      | 3,164                      |   |   |                      |   | $ | 696 |   | $ | (247 | ) | $ | 449 |   |
|                                             |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| Net                  interest spread             |   |                                                                                   |          |                                                  |   |                                       |   |   | 4.92                      | %      |   |    |   |   |                       |   |   | 5.07                      | %      |   |   |   |   |   |   |   |   |   |
|                                             |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| Net                  interest expense to average |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| earning                  assets                  |   |                                                                                   |          |                                                  |   |                                       |   |   | 1.49                      | %      |   |    |   |   |                       |   |   | 1.18                      | %      |   |   |   |   |   |   |   |   |   |
|                                             |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |
| Net                  interest margin             |   |                                                                                   |          |                                                  |   |                                       |   |   | 5.39                      | %      |   |    |   |   |                       |   |   | 5.40                      | %      |   |   |   |   |   |   |   |   |   |
|                                             |   |                                                                                   |          |                                                  |   |                                       |   |   |                      |   |   |    |   |   |                       |   |   |                      |   |   |   |   |   |   |   |   |   |   |

----

**Liquidity      and Capital Resources**

----

**Item      3.** **Quantitive and Qualitive      Disclosures about Market Risk**

**Item        4. Controls and Procedures**

| (a) | The                  Company’s                  management, including the Company’s Chief Executive Officer and Chief                  Financial Officer, evaluated the effectiveness of its disclosure                  controls                  and procedures as of June 30, 2005. Based on this evaluation, the                  Chief                  Executive Officer and the Chief Financial Officer each concludes                  that as                  of June 30, 2005, the Company maintained effective disclosure controls                  and                  procedures in all material respects, including those to ensure                  that                  information required to be disclosed in reports filed or submitted                  with                  the SEC is recorded, processed, and reported within the time periods                  specified by the SEC, and is accumulated and communicated to management,                  including the Chief Executive Officer and the Chief Financial Officer,                  as                  appropriate to allow for timely decision regarding required disclosure. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | Changes                  in                  Internal Controls: In the quarter ended June 30, 2005, the Company                  did not                  make any significant changes in, nor take any corrective actions                  regarding, its internal controls or other factors that could significantly                  affect these controls. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

**Disclosure        Controls and Internal Controls.**

**Limitations        on the Effectiveness of Controls**

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**PART      II.** **OTHER      INFORMATION**

| **Item                1.**                                                                                                                                         |      | **Legal                proceedings.**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                               |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|                                                                                                                                                               |      | As                of the                date of filing this Form 10-Q neither Bancorp nor the Bank was a                party to                any material legal proceedings. Further, management is not aware                of any                threatened or pending lawsuits or other proceedings against the Company                which, if determined adversely, would have a material effect on the                business or its financial position. Bancorp or the Bank may from                time to                time become a party to litigation in the ordinary course of business,                such                as debt collection litigation or through an appearance as a creditor                in a                bankruptcy case. |
|                                                                                                                                                               |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| **Item                2.**                                                                                                                                         |      | **Changes                in securities and use of proceeds.**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|                                                                                                                                                               |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|                                                                                                                                                               |      | None.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|                                                                                                                                                               |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| **Item                3.**                                                                                                                                         |      | **Defaults                upon senior securities.**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|                                                                                                                                                               |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|                                                                                                                                                               |      | None.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|                                                                                                                                                               |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| **Item                4.**                                                                                                                                         |      | **Submission                of matters to a vote of security holders.**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|                                                                                                                                                               |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|                                                                                                                                                               |      | The                  Annual                  Meeting of Stockholders was held on April 26, 2005. There were                  2,144,316                  shares of common stock that could be voted, and 1,228,548 shares                  present                  at the meeting by holders thereof by proxy, which constituted a                  quorum.                  The following is a summary of the results of the vote:                                                                                                                                                                                                                                                                                                                                      |
|                                                                                                                                                               |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|                                                                                                                                                               |      | Vote                  for the                  election of Directors:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|                                                                                                                                                               |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|                                                                                                                                                               |      | Nominees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | Term | Votes: | For | Against |  |
|                                                                                                                                                               |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |   |   |  |   |  |
|                                                                                                                                                               |      | Patricia                Benetti                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | Three                  Years |   | 1,221,081 | 7,467 |  |
|                                                                                                                                                               |      | Doug                Feldkamp                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | Three                  Years |   | 1,221,081 | 7,467 |  |
|                                                                                                                                                               |      | Marteen                Wick                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | Three                  Years |   | 1,216,641 | 11,907 |  |
|                                                                                                                                                               |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| **Item                5.**                                                                                                                                         |      | **Other                information.**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|                                                                                                                                                               |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|                                                                                                                                                               |      | None.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|                                                                                                                                                               |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| **Item                6.**                                                                                                                                    |      | **Exhibits                and reports on Form 8-K.**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|                                                                                                                                                               |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| (a)                                                                                                                                                                | Exhibits. |
|                                                                                                                                                               |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| The                following                documents are filed as part of this Form 10-Q as required by Item                601 of                Regulation S-K: |
|                                                                                                                                                               |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|                                                                                                                                                               | 3.1       | Articles                  of                  Incorporation of Oregon Pacific Bancorp (incorporated herein by                  reference                  to Exhibit 3(i) to Oregon Pacific Bancorp’s Form 10-K for the year ended                  December 31, 2002 filed with the Securities and Exchange Commission                  on                  March 31, 2003).                                                                                                                                                                                                                                                                                                                                                                                      |
|                                                                                                                                                               |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|                                                                                                                                                               | 3.2       | Bylaws                  of                  Oregon Pacific Bancorp (incorporated herein by reference to Exhibit                  3(i)                  to Oregon Pacific Bancorp’s Form 10-K for the year ended December 31, 2002                  filed with the Securities and Exchange Commission on March 31,                  2003).                                                                                                                                                                                                                                                                                                                                                                                                                          |

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|   |       |                                                                                                                                                                                                                                                                                                                                                              |
|--------|------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | 10.1  | 2003                  Stock                  Incentive Plan (incorporated by reference to Exhibit 1 to Oregon                  Pacific                  Bancorp’s Form DEF 14A filed with the Securities and Exchange Commission                  on March 25, 2003).                                                                                       |
|   |       |                                                                                                                                                                                                                                                                                                                                                              |
|   | 10.2       | Oregon                  Pacific Banking Co. Deferred Compensation and Incentive Plan (incorporated                  herein by reference to Exhibit 10.2 to Oregon Pacific Bancorp’s Form 10-K                  for the year ended December 31, 2003 filed with the Securities                  and                  Exchange Commission on March 30, 2004). |
|   |       |                                                                                                                                                                                                                                                                                                                                                              |
|   | 31.1  | Certification                  of Chief Executive Officer pursuant to rule 13a-14(a) or Rule 15d-14(a)                  and Section 302(a) of the Sarbanes-Oxley Act of 2002.**                                                                                                                                                                                   |
|   |       |                                                                                                                                                                                                                                                                                                                                                              |
|   | 31.2       | Certification                  of Chief Financial Officer pursuant to rule 13a-14(a) or Rule 15d-14(a)                  and Section 302(a) of the Sarbanes-Oxley Act of 2002.**                                                                                                                                                                                   |
|   |       |                                                                                                                                                                                                                                                                                                                                                              |
|   | 32.1       | Certification                  Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section                  906 of                  the Sarbanes-Oxley Act of 2002. **                                                                                                                                                                                     |
|   |       |                                                                                                                                                                                                                                                                                                                                                              |
|   |       |                                                                                                                                                                                                                                                                                                                                                              |

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**SIGNATURES**

|         |                                                                                                                                         |                                  |
|--------------|----------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------|
|         | **OREGON              PACIFIC BANCORP**                                                                                                      |
|    |                                                                                                                                    |                             |
|         | By:                                                                                                                                | /s/ Thomas              K. Grove |
|         | Thomas              K. Grove                                                                                                                 |
|         | President,                Chief Executive OfficerAnd                  Director                  (*Chief Executive                  Officer)* |

|         |                                                                                                |                                  |
|--------------|-----------------------------------------------------------------------------------------------------|---------------------------------------|
|         |                                                                                                |
|    |                                                                                           |                             |
|         | By:                                                                                       | /s/ Joanne              Forsberg |
|         | Joanne              Forsberg                                                                        |
|         | Secretary                and Chief Financial Officer (*Principal                Financial Officer)* |

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