Exhibit 10.3

                             SECOND AMENDMENT TO THE
                               STEPHEN H. WACKNITZ
                              EMPLOYMENT AGREEMENT



                  This Second Amendment ("SECOND AMENDMENT") to that certain
Employment Agreement dated October 1, 2003, with an effective date of January 1,
2003, as amended by that certain First Amendment dated June 23, 2005
(collectively, "ORIGINAL Agreement") is entered into as of February 2, 2006 by
and between Stephen H. Wacknitz, an individual ("EXECUTIVE") and Temecula Valley
Bank ("BANK").

                                  R E C I T A L

                  At the request of Executive, and pursuant to the
recommendation of the Executive Officer Compensation Committee, with such
recommendations adopted by the Bank's Board of Directors on February 1, 2006,
Bank and Executive wish to amend the Original Agreement as provided in this
Second Amendment.

                                A G R E E M E N T

                  NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants and agreements contained herein, the parties hereby agree and
consent to the amendment of the Original Agreement, effective on the date
hereof, as follows:

         1. The first paragraph of Section D.4. to the Original Agreement is
amended in its entirety to read as follows:

                           "4. BONUS. For each fiscal year end within the Term,
                  Executive shall be entitled to an Incentive Bonus determined
                  in accordance with this Section if the Threshold Test is met.
                  The Threshold Test shall be deemed to have been met if one or
                  more of the following exists: (i) Bank's regular outside
                  independent loan reviewer gives a favorable review of the loan
                  quality of Bank at its most recent review; (ii) net loan
                  losses for the year do not exceed one percent of gross
                  outstanding loans at the beginning of the applicable year; or
                  (iii) the latest report of supervisory activity of Bank by
                  Bank's primary regulator rates Bank no less than satisfactory.
                  The Incentive Bonus shall equal 5% of the "Profits" of
                  Temecula Valley Bancorp Inc. ("COMPANY")." For purposes of
                  this Section 4, "Profits" shall mean Company's net income
                  before income taxes and before the effect of this bonus or any
                  other bonuses based on the profits of Bank or Company."

         2. CONTINUED EFFECT. Except as otherwise expressly provided herein, the
Original Agreement will continue in full force and effect, in accordance with
its terms.

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         3. MISCELLANEOUS. This Second Amendment will be governed in all
respects by the laws of the State of California as such laws are applied to
agreements between California residents entered into and to be performed
entirely within California. This Second Amendment constitutes the full and
entire understanding and agreement between the parties with regard to the
subjects hereof and supersedes all prior written and oral agreements,
representations and commitments, if any, between the parties with respect to
such subjects. This Second Amendment may be executed in any number of
counterparts, each of which will be an original, but all of which together will
constitute one instrument.

         IN WITNESS WHEREOF, the parties hereto have executed this Second
Agreement on February 2, 2006.



                                   EXECUTIVE


                                   /S/ Stephen H. Wacknitz
                                   -------------------------------------------
                                   Stephen H. Wacknitz



                                   TEMECULA VALLEY BANK


                                   By: /S/ Donald A. Pitcher
                                   -------------------------------------------
                                   Donald A. Pitcher
                                   Secretary and Chief Financial Officer



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