<PAGE>


                                     EXHIBIT
                                    ITEM 99.29

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

         The following discussion is intended to provide sufficient information
about the Company and its subsidiary, Redlands Centennial Bank, to enhance the
reader's understanding of the Company's financial condition and results of
operations. The Company has not conducted any significant business activities
independent of Redlands Centennial Bank since its inception. Therefore, the
following discussion and analysis relates primarily to Redlands Centennial Bank.
In order to understand this section in context, it should be read in conjunction
with the audited financial statements, including the notes thereto and other
data presented elsewhere in this prospectus.

SUMMARY

         The Company reported net income of $907,000 for the year ending
December 31, 2000, compared to net income totaling $729,000 for the year ending
December 31, 1999, versus net income totaling $627,000 for the year ending
December 31, 1998. This represents an increase of 24%, 16% and 3% for 2000,
1999, and 1998, respectively. Basic earnings per share were $1.33, $1.03, and
$0.92 for the years 2000, 1999, and 1998, respectively. Diluted earnings per
share, adjusted for the effect of the exercise of stock options and stock
dividends, resulted in earnings per share of $1.25 in 2000, $0.96 in 1999, and
$0.84 1998.

         Total assets at December 31, 2000 reached a record of $94.1 million, an
increase of 24% or $18.1 million, compared to total assets of $76.0 million at
December 31, 1999. Total assets at year-end 1999 exceeded year-end 1998 totals
by $6.4 million, or 9%.

         At December 31, 2000, total deposits grew to a record level of $86.4
million, an increase of $17.2 million or 25% above year-end 1999. Total loans,
net of the reserve for loan losses, increased $6.4 million, or 12% to $58.8
million.

         Return on average shareholders' equity was 13.74%, 12.01%, and 11.43%
for the years ending December 31, 2000, 1999, and 1998, respectively. Return on
average assets was 1.07%, 1.10%, and .98% for the years ending December 31,
2000, 1999, and 1998, respectively. The total risk-based capital ratio was
11.49%, 11.22%, and 12.37% for 2000, 1999, and 1998, respectively. The minimum
total risk-based capital ratio established by the FDIC to be qualified as "well
capitalized" is 10.00%.

NET INTEREST INCOME AND NET INTEREST MARGIN

         Net interest income is the difference between interest earned on loans
and investments and interest paid on deposits. Net interest income totaled $5.6
million for the year ended December 31, 2000, up 28% from $4.4 million at
December 31, 1999, compared to net interest income of $3.3 million in 1998. The
primary factor contributing to the growth of net interest income during 2000 was
an increase in volume of loans made, fees and interest on construction loans and
increases in the Company's prime rate. Earning assets increased $14.2 million,
or 21%, to $80.4 million in 2000, compared to an increase of $5.3 million, or
8.8%, to $65.9 million in 1999.


                                       10
<PAGE>


         The net interest margin was 7.51%, 6.96%, and 5.91% for the years ended
December 31, 2000, 1999 and 1998, respectively.

LIQUIDITY AND ASSET/LIABILITY MANAGEMENT

         The Company's liquidity is primarily a reflection of the Company's
ability to acquire funds to meet loan demand and deposit withdrawals and to
service other liabilities as they come due. The Company has adopted policies to
maintain a relatively liquid position to enable it to respond to changes in the
financial environment and ensure sufficient funds are available to meet those
needs. Generally, the Company's major sources of liquidity are customer
deposits, sales and maturities of investment securities, the use of federal
funds markets, and net cash provided by operating activities. Scheduled loan
repayments are a relatively stable source of funds, while deposit inflows and
unscheduled loan prepayments, which are influenced by general interest rate
levels, interest rates available on other investments, competition, economic
conditions, and other factors, are not. Liquid asset balances include cash,
amounts due from other banks, federal funds sold, and securities
available-for-sale. To augment liquidity, the Company has a Federal Funds
borrowing arrangement with three correspondent banks totaling $5.5 million.

         The following table sets forth certain information with respect to the
Company's liquidity as of December 31, 2000, 1999 and 1998.

<TABLE>
<CAPTION>
(Dollars in thousands)                             YEAR ENDED DECEMBER 31,
                                            -----------------------------------
                                             2000          1999          1998
                                            -------       -------       -------
<S>                                         <C>           <C>           <C>
Cash and due from banks ..............      $ 8,339       $ 5,230       $ 4,486
Federal funds sold ...................        7,370         2,150         6,820
Interest earning deposits ............        4,780         3,612         4,104
Unpledged securities .................        6,691         7,603         9,088
                                            -------       -------       -------
     Total liquid assets .............      $27,180       $18,595       $24,498
                                            =======       =======       =======

Liquidity ratios(1)
  Liquid assets
    Ending assets ....................        28.88%        24.46%        35.20%
    Ending deposits(2) ...............        31.47%        26.89%        38.87%
</TABLE>


----------------

(1)      Liquid assets include cash and due from banks, federal funds sold,
         interest-bearing deposits and market value of available-for-sale
         securities less book value of pledged securities.

(2)      Less pledged public deposits.

         Liquidity, which primarily represents the Company's ability to meet
fluctuations in deposit levels and customers' credit needs, is managed through
various funding strategies that reflect the maturity structure of the assets
being funded. Management monitors its liquidity position daily in relation to
its deposit base and projected loan funding or payoffs.

         Excess liquidity can adversely impact earnings, if not properly
managed. The process of asset/liability management has evolved from simple "gap"
analysis, where a bank views repricing opportunities of its assets and
liabilities through various time periods, to simulation, interest rate risk, and
economic value of equity reporting. These processes not only measure risk, but
also provide the Company with evaluation tools necessary for prudent management
of continued, stable earnings, regardless of interest rate fluctuations.


                                       11
<PAGE>

RISK MANAGEMENT

         Various types of risk are inherent in the business of banking. Federal
regulators have adopted examination guidelines that scrutinize not only a bank's
level of risk, but also its ability to manage and control that risk. Regulators
evaluate risks that affect capital, liquidity, and compliance to determine their
potential effect on the safety and soundness of a bank. Certain risks may be
covered by insurance coverage, but management must establish a risk management
approach that addresses all areas of risk.

         The Company has in place acceptable limits for each of the risks
identified by the FDIC. We have defined various types of risk, and have
mechanisms in place to manage, monitor and report those risks. Specifically, the
Company focuses on six risk categories within each area of the Company. Those
include credit risk, interest rate risk, liquidity risk, market risk,
transaction risk and compliance risk.

OTHER INCOME

         Other income for the Company includes customer service fees, net gain
from sale of loans, net gain or loss from sale of investment securities, and
other miscellaneous income. Total other income grew 106%, or $1.1 million in
2000 to $2.1 million, primarily as a result of the one time gain on sale of
Redlands Centennial Bank's investment in BancData Solutions, a bank service
corporation, that provided data and item processing for 19 banks. Other income,
excluding the gain from the sale of Redlands Centennial Bank's investment in
BancData Solutions, increased 13.8% or $143,000 to $1.2 million for 2000
compared to 1999. Other income increased 5.9%, or $58,000 to $1.03 million in
1999 compared to $977,000 in 1998. In 1998, total other income increased 76.2%
to $977,000 as a result of increases in fees, revenue gains from the sale of SBA
loans, and gains from the sales of investment securities.

         Customer service charges and fees increased 11% and sale of loans
increased 26% in 2000. Customer service fees increased to $800,000 in 2000 from
$718,000 in 1999 and $518,000 in 1998. The gain on sale of loans was $277,000 in
2000, compared to $220,000 in 1999, and $286,000 in 1998.

         The following table sets forth components of the Company's noninterest
income:

<TABLE>
<CAPTION>
(Dollars in thousands)                              YEAR ENDED DECEMBER 31,
                                              ----------------------------------
                                                2000        1999          1998
                                              -------      -------       -------
<S>                                           <C>          <C>           <C>
FEES AND OTHER INCOME:
Customer service fees ..................      $   800      $   718       $   518
Gain from sale of loans ................          277          220           286
Gain (loss) from sale
 of investment securities ..............           11           (2)          119
Gain from sale of investment in
 BancData Solutions, Inc. ..............          906         --            --
Other income ...........................           90           99            54
                                              -------      -------       -------
     Total other income ................      $ 2,084      $ 1,035       $   977
                                              =======      =======       =======
</TABLE>



                                       12
<PAGE>



OTHER EXPENSES

         Total other expenses for 2000 were $5.7 million compared to $4.1
million in 1999, an increase of $1.5 million, or 37%. Other expenses for 1999
exceeded other expenses for 1998 by $700,000, or 21%.

         During 2000, salaries and employee benefits increased 33% to $2.9
million from $2.2 million in 1999 as the result of increased staff for the SBA
and Construction Departments of Redlands Centennial Bank, as well as mid-year
staffing for the Loan Production Office in Anaheim. In addition, Redlands
Centennial Bank funded an Employee Stock Ownership Plan in 2000. Salaries and
employee benefits for 1998 were $1.6 million.

         For 2000, occupancy expense increased 21%, or $75,000 to $429,000.
Included were expenses for premises, equipment and repair, as well as costs for
computer hardware and software depreciation. In 1999, net occupancy expense
increased $39,000 to $354,000, or 12.4%, compared to an increase of $59,000, or
23.0%, from 1997 to 1998. Cost increases relate to the Company's expansion in
establishing new sources of loan and fee income through real estate,
construction and SBA lending.

         Other operating expenses, including professional fees, data processing
fees, supplies and advertising were $2.4 million in 2000, compared to $1.6
million in 1999, an increase of 45%, or $737,000 principally as a result of
increased professional fees. Other operating expenses for 1999 were $1.6 million
compared to $1.5 million in 1998.

         The following table summarizes the significant components of
noninterest expense for the years ended December 31, 2000, 1999 and 1998:

<TABLE>
<CAPTION>
(Dollars in thousands)                               YEAR ENDED DECEMBER 31,
                                              ----------------------------------
                                               2000          1999          1998
                                              ------        ------        ------
<S>                                           <C>           <C>           <C>
OTHER EXPENSES:
Salaries and wages ...................        $2,196        $1,698        $1,308
Employee benefits ....................           696           468           283
Net occupancy expense ................           429           354           315
Other operating expense ..............         2,369         1,632         1,546
                                              ------        ------        ------
     Total other expenses ............        $5,690        $4,152        $3,452
                                              ======        ======        ======
</TABLE>

INCOME TAXES

         The provision for income taxes was $472,000 in 2000 compared to
$319,000 in 1999 and $193,000 in 1998. For the year ended December 31, 2000, the
effective tax rate was 34.2% compared to an effective tax rate of 30.4% in 1999,
and 23.5% in 1998.





                                       13
<PAGE>

INVESTMENT SECURITIES

         The Company's investment portfolio provides income to the Company and
also serves as a source of liquidity. Total yield, maturity and risk are among
the factors considered in building the investment portfolio. Under FDIC
guidelines for risk-based capital, certain loans and investments may affect the
level of capital required to support risk-weighted assets. For example, U.S.
Treasury Securities have a 0% risk weighting, whereas U.S. agency pools have a
20% risk weighting, while 1-4 family real estate loans carry a 50% risk
weighting. In addition, pursuant to FASB 115, securities must be classified as
"held to maturity," "available for sale," or "trading securities." Those
securities held in the "available for sale" category must be carried on the
Company's books at "fair market value." At December 31, 2000, the Company's
"available-for-sale" investment portfolio at fair value consisted of $5.0
million in mortgage-backed securities, $4.0 million in municipal bonds, and
$401,000 in U.S. Treasury obligations compared to $3.6 million, $3.8 million and
$399,000, respectively in 1999.

         At December 31, 2000, and at December 31, 1999, the Company did not
carry any "held to maturity" investments, compared to $807,000 at December 31,
1998, which was carried at net book value. Interest-bearing deposits in
short-term time certificates at other financial institutions totaled $4.8
million at year-end 2000 versus $3.6 million in 1999 and $4.1 million in 1998.
Overnight federal funds sold totaled $7.4 million in 2000, $2.1 million in 1999,
as compared to $6.8 million in 1998.

LOANS

         Total loans were $60 million at December 31, 2000, an increase of $6.8
million, or 13% from total loans of $53.2 million at December 31, 1999. Total
net loans for 1999 increased $12.1 million or 30% from year-end 1998. Real
estate loans totaled $30.6 million, an increase of $2.8 million, or 10% from
December 31, 1999. Real estate loans totaled $27.8 million at December 31, 1999,
an increase of $11 million or 70.5% from 1998. Commercial loans were $21.6
million at year-end 2000, compared to commercial loans of $18.7 million at
December 31, 1999, an increase of $2.9 million or 15%. Consumer installment
loans totaled $7.8 million, an increase of $1 million, or 16% from December 31,
1999 to December 31, 2000.

         Approximately 27%, or $16 million, of the Company's loan portfolio is
at fixed rates for 2000, compared to 29%, or $16 million, for 1999. Loans having
variable rates were $44 million in 2000 compared to $37 million in 1999.

ALLOWANCES AND PROVISIONS FOR LOAN LOSSES

         The provision for loan losses was $630,000 in 2000, compared to
$225,000 in 1999 and $50,000 in 1998. The allowance for loan losses was
$868,000 or 1.45% of gross loans at December 31, 2000, compared to $581,000
or 1.10% of gross loans at December 31, 1999. Nonperforming assets include
loans for which interest is no longer accruing, loans 90 or more days past
due, impaired loans and other real estate owned. As a result of the Company's
continued adherence to strict loan standards and policies, nonperforming
assets at December 31, 2000 were only $287,819 compared to $356,922 at
December 31, 1999, representing .48% and .67%, respectively of gross loans.


                                       14
<PAGE>

         The adequacy of the allowance for loan losses is measured in the
context of several key ratios and factors including: (1) the ratio of the
allowance to total outstanding loans; (2) the ratio of total nonperforming loans
to total loans; and, (3) the ratio of net charge-offs (recoveries) to average
loans outstanding. Additional factors considered in establishing an appropriate
allowance include a careful assessment of the financial condition of the
borrower; a realistic determination of the value and adequacy of underlying
collateral; the condition of the local economy and the condition of the specific
industry of the borrower; comprehensive analysis of the levels and trends of
loan categories; and a review of delinquent and classified loans. Management's
evaluation is based on a system whereby each loan is "graded" at the time of
origination, extension or renewal. Each grade is assessed a risk factor, which
is calculated to assess the adequacy of the allowance for loan losses. Further,
management considers other factors including changes in the nature and volume of
the loan portfolio, overall portfolio quality, loan concentrations, trends in
the level of delinquent and classified loans, specific problem loans and
commitments, and current and anticipated economic conditions.

DEPOSITS

         Total deposits increased $17.2 million, or 25%, to a record level of
$86.4 million at December 31, 2000 from $69.1 million in 1999. During 1999,
deposits increased $5.8 million or 9.2% to $69.1 million from December 31, 1998.
Noninterest-bearing demand deposits at December 31, 2000, increased $5.7
million, or 32% from the previous period to $23.8 million. Interest-bearing and
NOW accounts increased 64%, or $11.4 million to $29.3 million in 2000. Savings
and time deposits remained stable, increasing only 2% to $33.2 million from
$33.1 million a year ago.

         The Company's cost of funds is the result of total interest expense
divided by total deposits. An increase in money market deposits had a
detrimental effect on the Company's overall cost of funds during 2000. For 2000,
cost of funds was 2.70% compared to 2.29% for 1999 and 2.67% for 1998.

DIVIDENDS

         During 2000, the Company paid three dividends. In January, shareholders
of record on January 3, 2000 were issued shares for a five percent stock
dividend as well as a cash dividend equal to five cents per share. In August
2000, the Company paid an additional five cents per share cash dividend to
shareholders of record on July 1, 2000.

RESULTS OF OPERATIONS
NET INTEREST INCOME/NET INTEREST MARGIN

         Net interest income for the year ended December 31, 2000 was $5.6
million, an increase of 27.9% or $1.2 million over net income of $4.4 million
during the same period of 1999. The increase was primarily due to the growth in
average loans, largely due to improved economic conditions in the Company's
market areas, and an increase in the prime-lending rate.


                                       15
<PAGE>


STATISTICAL INFORMATION

         The following table sets forth average assets, liabilities, and
shareholders' equity; the amount of interest income or interest expense; and the
average yield or rate for each category of interest-bearing assets and
interest-bearing liabilities and the net interest margin (net interest income
divided by average earning assets) for the periods indicated:

        Schedule of Average Assets, Liabilities and Shareholders' Equity

<TABLE>
<CAPTION>
(Dollars in thousands)                            2000                               1999
                                     ------------------------------     ------------------------------
                                                INTEREST    AVERAGE              INTEREST     AVERAGE
                                     AVERAGE    EARNED/    INTEREST     AVERAGE   EARNED/    INTEREST
                                     BALANCE      PAID       RATE       BALANCE    PAID        RATE
                                     -------    -------    --------     -------   -------    ---------
<S>                                  <C>        <C>            <C>      <C>       <C>           <C>
INTEREST-EARNING ASSETS:
Federal funds sold ...............   $ 7,408    $   454        6.13%    $ 3,157   $   151       4.78%
Interest-bearing deposits in
 financial institutions ..........     3,620        219        6.05%      3,900       238       6.10%
Investment securities
  Taxable ........................     4,414        257        5.82%      5,523       331       5.99%
  Non-taxable(1) .................     3,461        158        4.57%      3,518       156       4.43%
                                     -------    -------                 -------   -------
Total investments ................    18,903      1,088        5.76%     16,098       876       5.44%
Loans ............................    55,822      6,858       12.29%     46,978     5,100      10.86%
                                     -------    -------                 -------   -------
      Total interest-earning assets  $74,725    $ 7,946       10.63%    $63,076   $ 5,976       9.47%
                                                =======                           =======
Other assets .....................    10,218                             10,853
                                     -------                            -------
      Total assets ...............   $84,943                            $73,929
                                     =======                            =======

INTEREST-BEARING LIABILITIES:
Demand deposits ..................   $19,180       --           --      $16,678      --           --
Interest-bearing demand deposits .    10,131    $   119        1.17%     10,510   $   119       1.13%
Money market deposits ............    13,611        550        4.04%      7,631       212       2.78%
Savings deposits .................     9,609        239        2.49%     11,180       295       2.64%
Time deposits of $100,000 or more.    12,859        727        5.65%      9,397       452       4.81%
Time deposits under $100,000......    11,590        650        5.61%     10,592       508       4.80%
                                     -------    -------                 -------   -------
Total interest-bearing liabilities   $57,800    $ 2,285        3.95%    $49,310   $ 1,586       3.22%
                                     =======    =======                 =======   =======
Other borrowings .................       758         46        6.07%       --        --           --
                                     -------    -------                 -------   -------
Total deposits and other borrowings  $77,738    $ 2,331        3.00%    $65,988   $ 1,586       2.40%
                                     =======    =======                 =======   =======
Other liabilities ................       972                              1,882
Average rate excluding demand
 deposits ........................                             3.98%                            3.22%
Total liabilities
Shareholders' equity .............     6,233                              6,059
                                     -------                            -------
Total liabilities and shareholder
 equity ..........................   $84,943                            $73,929
                                     =======                            =======
Net interest income ..............              $ 5,615                           $ 4,390
                                                =======                           =======
Net interest margin ..............                             7.51%                            6.96%
</TABLE>

(1)      Tax exempt income on non-taxable investment securities is not tax
         effected with respect to interest earned or calculation of average
         interest rate.



                                       16
<PAGE>


ANALYSIS OF CHANGES IN INTEREST DIFFERENTIAL

         The following table shows the unaudited dollar amount of the increase
(decrease) in the Company's net interest income and expense and attributes such
dollar amounts to changes in volume as well as changes in rates. Rate and volume
variances have been allocated proportionally between rate and volume changes.

<TABLE>
<CAPTION>
(Dollars in thousands)                             YEAR ENDED                       YEAR ENDED
                                                DECEMBER 31, 2000                DECEMBER 31, 1999
                                                    OVER 1999                        OVER 1998
                                           INCREASE (DECREASE) DUE TO       INCREASE (DECREASE) DUE TO
                                          -----------------------------    -----------------------------
                                          VOLUME      RATE       TOTAL     VOLUME      RATE       TOTAL
                                          -------    -------    -------    -------    -------    -------
<S>                                       <C>        <C>        <C>        <C>        <C>        <C>
Increase (decrease) in interest income
Federal funds sold ....................   $   248    $    55    $   303    $  (239)   $    50    $  (189)
Interest-bearing deposits in
 financial institutions ...............        71        (90)       (19)       (32)        18        (14)
Investment securities(1) ..............        93       (165)       (72)      (113)        70        (43)
Loans .................................       635      1,123      1,758      1,213        (30)     1,183
                                          -------    -------    -------    -------    -------    -------
       Total ..........................   $ 1,047    $   923    $ 1,970    $   829    $   108    $   937
                                          -------    -------    -------    -------    -------    -------

Increase (decrease) in interest expense
Interest bearing demand deposits ......   $    13    $   (13)   $     0    $    32    $   (25)   $     7
Money market deposits .................       286         52        338        (23)        28          5
Savings deposits ......................       (66)        10        (56)        13        (55)       (42)
Time deposits of $100,000 or more .....       149        126        275        142       (294)      (152)
Time deposits under $100,000 ..........       (23)       165        142        (47)       121         74
Other borrowers .......................         0         46         46
                                          -------    -------    -------    -------    -------    -------
       Total ..........................   $   359    $   386    $   745    $   117    $  (225)   $  (108)
                                          -------    -------    -------    -------    -------    -------

Total change in net interest income ...   $   688    $   537    $ 1,225    $   712    $   333    $ 1,045
                                          =======    =======    =======    =======    =======    =======
</TABLE>

-------------
(1)      Tax exempt income on non-taxable investment securities is not tax
         effected with respect to the calculation of interest income for
         investment securities.


                                       17
<PAGE>


INVESTMENTS

         The following table is a comparison of amortized cost and fair value of
investment securities at December 31, 2000 and 1999:

<TABLE>
<CAPTION>
(Dollars in thousands)                           DECEMBER 31, 2000
                                 ----------------------------------------------
                                 AMORTIZED    UNREALIZED   UNREALIZED    FAIR
                                   COST         GAINS        LOSSES      VALUE
                                 ---------    ----------   ----------    ------
<S>                              <C>          <C>          <C>           <C>
Available-for-sale:
Mortgage-backed securities...      $5,072      $      -      $   28      $5,044
Obligations of states
 and local governments ......       4,027             -          43       3,984
U.S. Treasury obligations....         402             -           1         401
                                 ---------    ----------   ----------    ------
                                   $9,501      $      -      $   72      $9,429
                                 =========    ==========   ==========    ======
</TABLE>

<TABLE>
<CAPTION>
(Dollars in thousands)                            DECEMBER 31, 1999
                                 ----------------------------------------------
                                 AMORTIZED    UNREALIZED   UNREALIZED    FAIR
                                   COST         GAINS        LOSSES      VALUE
                                 ---------    ----------   ----------    ------
<S>                              <C>          <C>          <C>           <C>
Available-for-sale:
Mortgage-backed securities...      $3,722      $      -      $   81      $3,641
Obligations of states
 and local governments ......       4,011             -         258       3,753
U.S. Treasury obligations....         405             -           6         399
                                 ---------    ----------   ----------    ------
                                   $8,138      $      -      $  345      $7,793
                                 =========    ==========   ==========    ======
</TABLE>

At December 31, 2000 the book value of the following issuer's securities
exceeded 10% of the Company's shareholders' equity:

<TABLE>
<CAPTION>
(Dollars in thousands)                       BOOK VALUE              MARKET VALUE
                                             ----------              ------------
<S>                                          <C>                     <C>
Mortgage-backed guaranteed by GNMA             $ 1,295                  $ 1,288
Mortgage-backed issued by FNMA                 $   954                  $   945
Mortgage-backed issued by FHLMC                $   808                  $   798
CMOs guaranteed by GNMA                        $   980                  $   982
CMOs issued by FHLMC                           $   663                  $   663
</TABLE>




                                       18
<PAGE>


         Investment securities at the dates indicated consisted of the
following:

<TABLE>
<CAPTION>
(Dollars in thousands)                   DECEMBER 31, 2000                   DECEMBER 31, 1999
                                 ----------------------------------  --------------------------------
                                               APPROX.                             APPROX.
                                 AMORTIZED     MARKET                AMORTIZED     MARKET
                                   COST        VALUE      % YIELD*     COST        VALUE     % YIELD*
                                 --------    ---------    ---------  ---------    --------   --------
<S>                              <C>         <C>          <C>        <C>          <C>        <C>
U.S. Treasury and Agencies:
One year or less ...........      $  402      $  402        5.44%      $    0      $    0          0
Over one to five years .....           0           0                      405         400       5.44%
Over five to ten years .....           0           0                                    0          0
Over ten years .............           0           0                                    0          0

CMO issued by U.S. Agencies:
One year or less ...........           0           0                       73          73       5.42%
Over one to five years .....       1,792       1,788        7.12%         936         913       6.38%
Over five to ten years .....         223         224        6.49%         223         206       6.49%
Over ten years .............           0           0                        0           0          0

Mortgage Backed Securities:
One year or less ...........          77          76        3.95%          86          83       3.78%
Over one to five years .....       1,631       1,614        7.03%       2,003       1,971       6.27%
Over five to ten years .....         357         355        7.03%         401         395       6.44%
Over ten years .............         991         986        8.05%           0           0          0

Tax Exempt Municipals:
One year or less ...........           0           0           0            0           0          0
Over one to five years .....         575         568        6.42%         361         335       6.63%
Over five to ten years .....       3,099       3,062        6.56%       2,457       2,296       6.48%
Over ten years .............           0           0           0          837         768       6.66%

Taxable Municipals:
One year or less ...........           0           0           0          330         329       7.01%
Over one to five years .....         326         328        7.32%           0           0          0
Over five to ten years .....           0           0           0            0           0          0
Over ten years .............          26          26        7.50%          26          24       7.50%
</TABLE>

-------------
*      Tax effected.




                                       19
<PAGE>


LOANS AND CONCENTRATIONS

         TYPES OF LOANS. The table below shows the composition of Redlands
Centennial Bank's loan portfolio at December 31, 2000 and 1999 is as follows:

<TABLE>
<CAPTION>
                                                      AS OF
                                                   DECEMBER 31,
                                  --------------------------------------------
(Dollars in thousands)                    2000                     1999
                                  --------------------     -------------------
                                    AMOUNT        %         AMOUNT       %
                                  --------    --------     --------   --------
<S>                               <C>         <C>          <C>        <C>
Real estate loans
  Construction and development    $ 14,358          24%    $ 15,248         29%
  Mortgage loans ..............     16,272          27%      12,533         23%
Commercial loans ..............     21,583          36%      18,686         35%
Automobile loans ..............      3,036           5%       2,468          5%
Indirect loans ................      1,063           2%       1,845          3%
Equity loans ..................      1,887           3%         876          2%
Consumer and other loans ......      1,827           3%       1,531          3%
                                  --------    --------     --------   --------

      Total loans .............     60,026         100%      53,187        100%

Less unearned income ..........       (384)                    (224)
Less allowance for loans losses       (868)                    (581)
                                  --------                 --------

      Net loans ...............   $ 58,774                 $ 52,382
                                  ========                 ========
</TABLE>

REAL ESTATE - CONSTRUCTION

       The Company makes loans to finance the construction of residential and
commercial properties and to finance land acquisition and development.
Construction and development loans are obtained principally through
solicitations by the Company and through continued business from builders and
developers who have previously borrowed from the Company. When the total amount
of a loan would otherwise exceed the Company's legal lending limit, the Company
sells participation interests to other financial institutions to facilitate the
extension of credit.

       The Company's owner-occupied single family construction loans typically
have a maturity of nine months for construction-to-permanent loans and up to
twelve months for construction only loans, and are secured by deeds of trust and
usually do not exceed 80% of the appraised value of the home to be built. All
owner-occupied single family construction borrowers have been pre-qualified for
long-term loans using Fannie Mae underwriting guidelines.

       Loans to developers for the purpose of acquiring unimproved land and
developing such land typically have a maturity of 12 to 18 months; have a
floating rate tied to prime rate; usually do not exceed 50% of the appraised
value on raw land or 65% of the appraised value when offsite improvements are
financed; are secured by a first deed of trust; and requires the principal to
personally guarantee repayment of the loan. Loan commitment and origination fees
of 1.5% to 2% are usually charged.



                                       20
<PAGE>

       Loans to developers for the purpose of acquiring unimproved land and
developing such land into improved 1-to-4 residential lots typically have a
maturity of 12 to 18 months; have a floating rate tied to prime rate; usually do
not exceed 65% of the appraised value; are secured by a first deed of trust; and
requires the principal to personally guarantee repayment of the loan. To further
reduce risk inherent in construction lending, the Company limits the number of
properties which can be constructed on a "speculative" or unsold basis
contingent upon absorption rates detailed by an approved appraiser and subject
to final review and approval by the Company's Real Estate Dept. Manager.

       The Company's underwriting criteria is designed to evaluate and minimize
the risk of each construction loan. A wide variety of factors are carefully
considered before originating a construction loan, including the availability of
permanent financing to the borrower (which may be provided by the Company at
prevailing market rates); the reputation of the borrower and the contractor;
independent valuations and reviews of cost estimates; pre-construction sale
information, and cash flow projections of the borrower. At the time of the
Company's origination of a construction loan to a builder, the builder often has
a signed contract with a purchaser for the sale of the "to-be-constructed"
house, thereby providing reasonable assurance of a repayment source and
mitigation of the Company's underwriting risks. To further reduce risk inherent
in construction lending, the Company limits the number of properties which can
be constructed on a "speculative" or unsold basis contingent upon absorption
rates detailed by an approved appraiser and subject to final review and approval
by the Company's Real Estate Department Manager. Moreover, the Company controls
certain risks associated with construction lending via a fund
disbursement/voucher-control system requiring builders to submit itemized bills
to the Company (along with appropriate lien releases), and by paying the
subcontractors directly. For a contractor meeting specific criteria, loan funds
may be disbursed under a "draw" system, directly to the contractor.

       Commercial construction loans are underwritten using the actual or
estimated cash flow the secured real property would provide to an investor
("Income Approach") in the event of a default by the borrower. A debt coverage
ratio of 1.2:1 and a maximum loan-to-value of 75% is required in most cases.

REAL ESTATE - COMMERCIAL

       In order to accommodate existing customers and to solicit new commercial
loan and deposit relationships, the Company originates permanent loans secured
by owner-occupied commercial real estate (investor-owned real estate is only
considered on an exception basis as an accommodation to substantial existing
customers). The Company's commercial real estate portfolio primarily includes
loans secured by small office buildings and commercial/industrial real
properties. Commercial real estate loans may be secured by a combination of both
commercial and single-family properties.

       At December 31, 2000, the Company had outstanding real estate secured
loans totaling $30.6 million.

BUSINESS LOANS

       The Company's commercial loans consist of (i) loans secured by commercial
real estate and (ii) business loans which are not secured by real estate, or if
secured by real estate, the principal source of repayment is expected to be from
business income, operating cash flows, etc.


                                     21

<PAGE>

For a discussion of the Company's loans secured by commercial real estate
lending see " -- Real Estate - Commercial." Business loans include revolving
lines of credit, working capital loans, equipment financing, letters of credit
and inventory financing. At December 31, 2000, the Company had business loans
totaling $21.6 million, representing 36% of the Company's net loan portfolio.

       Typically, business loans are floating rate obligations and are made for
terms of 5 years or less, depending on the purpose of the loan and the
collateral. No single business customer accounted for more than 3% of total net
loans at December 31, 2000.

CONSUMER AND OTHER LOANS

       The consumer loans originated by the Company include automobile loans and
miscellaneous other consumer loans, including unsecured loans, home lines of
credit and credit card accounts. At December 31, 2000, consumer loans totaled
$7.8 million, or 13% of the Company's net loan portfolio.

MATURITIES OF LOANS. The following table shows the maturity distribution of the
Company's loan portfolio with principal balances of loans indicated by both
fixed and floating rate categories as of December 31, 2000.

<TABLE>
<CAPTION>
(Dollars in thousands)         DUE IN          DUE AFTER
                              ONE YEAR         ONE YEAR             DUE AFTER
                              OR LESS     THROUGH FIVE YEARS       FIVE YEARS      TOTAL LOANS
                             ----------   ------------------    ----------------   ------------
<S>                            <C>        <C>                   <C>                <C>
FIXED RATE LOANS
Real estate loans
   Construction and
     development ........      $ 6,764        $   410                                 $ 7,174
   Mortgage loans .......          282            457                $    66              805
   SBA ..................                                                306              306
Commercial loans ........          497            582                     27            1,106
Automobile loans ........           93          2,669                    211            2,973
Indirect loans ..........          115            796                    152            1,063
Equity loans ............          145            135                  1,133            1,413
Consumer and other loans           447          1,048                    178            1,673
                               -------        -------                -------          -------
Total fixed rate loans ..      $ 8,343        $ 6,097                $ 2,073          $16,513
                               =======        =======                =======          =======

FLOATING RATE LOANS
Real estate loans
   Construction and
     development ........      $ 6,852        $   303                $    29          $ 7,184
   Mortgage loans .......        2,971          1,345                  5,391            9,707
   SBA ..................                          35                  5,419            5,454
Commercial loans ........       10,597          5,386                  4,494           20,477
Automobile loans ........            7             56                                      63
Equity loans ............          400             74                                     474
Consumer and other loans           150              4                                     154
                               -------        -------                -------          -------
Total floating rate loans      $20,977        $ 7,203                $15,333          $43,513
                               =======        =======                =======          =======

Total loans .............      $29,320        $13,300                $17,406          $60,026
                               =======        =======                =======          =======
</TABLE>


                                       22

<PAGE>

LOAN LOSSES AND RECOVERIES

         The following table summarizes the changes in the reserve for loan
losses for the periods shown:

<TABLE>
<CAPTION>
(Dollars in thousands)                      YEAR ENDED DECEMBER 31,
                                            -----------------------
                                               2000         1999
                                             --------     --------
<S>                                          <C>          <C>
Allowance for loan losses
 balance, beginning of period ............   $    581     $    433

Loans charged off:
Real estate ..............................          7            0
Commercial ...............................        345           13
Consumer .................................          0           77
Lease financing ..........................          6            0
Credit card and related accounts .........          5            6
                                             --------     --------
     Total loans charged off .............        363           96

Recoveries:
Real estate ..............................          0            0
Commercial ...............................          8           14
Consumer .................................         10            5
Lease financing ..........................          0            0
Credit card and related accounts .........          2            0
                                             --------     --------
     Total recoveries ....................         20           19
Net (charge-offs) recoveries .............       (343)         (77)
                                             --------     --------
Provision charged to operations ..........        630          225
                                             --------     --------

Allowance for loan losses balance,
 end of period ...........................   $    868     $    581
                                             ========     ========

Loans outstanding at end of period,
 net of unearned interest income .........   $ 59,642     $ 52,963

Average loans outstanding for the period .   $ 55,822     $ 46,978

Ratio of net loans charged off (recovered)
 to average loans outstanding ............        .62%         .16%

Ratio of allowance for loan losses to
 loans at end of period ..................       1.45%        1.10%
</TABLE>



                                       23
<PAGE>

         Charge-offs increased in 2000 primarily due to a single loan loss in
the amount of $294,000 associated with a commercial loan to a borrower who
had submitted fraudulent tax returns to Redlands Centennial Bank. Management
has implemented revised policies and procedures to ensure the accuracy of tax
returns provided by borrowers. Redlands Centennial Bank now requires
borrowers to execute a release that allows the Internal Revenue Service to
provide the borrowers' tax returns directly to Redlands Centennial Bank.

                   ALLOCATION OF THE ALLOWANCE FOR LOAN LOSSES

The following table sets forth the allocation of the ALL (Allowance for Loan
Losses), as of the dates indicated (dollar amounts in thousands):

<TABLE>
<CAPTION>

                                                                      DECEMBER 31,
                                              -------------------------------------------------------------------------
                                                         2000                           1999
                                              -------------------------------------------------------------------------
                                                             Ratio of Loan                               Ratio of Loan
                                               Allowance      Category to             Allowance           Category to
                                                 for          Outstanding                for              Outstanding
                                              Loan Losses     Total Loans             Loan Losses         Total Loans
                                              -----------     -----------             -----------         -----------
<S>                                           <C>            <C>                      <C>                <C>
Real estate-construction                      $    182              24%               $    157                  29%
Real estate-SBA
 (unguaranteed)                                     23               5%                     17                   4%
Real estate-SBA
 (guaranteed)                                       --               3%                     --                   3%
Real estate-other                                  105              19%                     85                  17%
Commercial loans                                   332              34%                    153                  32%
Commercial SBA
 (unguaranteed)                                      2               1%                      9                   1%
Commercial SBA
 (guaranteed)                                       --               1%                     --                   1%
Automobile-direct/indirect                          22               7%                     26                   8%
Auto insurance reserve                              --              --                      11                  --
Equity loans                                         9               3%                      4                   2%
Consumer & other                                    13               3%                      8                   3%
Not allocated                                      180              --                     111                  --
                                              --------             ----               --------                 ----
Total allowance for
 loan losses                                  $    868             100%               $    581                 100%

Total loans (net of
 Unearned income)                             $ 59,642                                $ 52,963


</TABLE>


The ALL is available to absorb losses from all loans, although allocations
have been made for certain loans and loan categories. The allocation of the
ALL as shown above should not be interpreted as an indication that
charge-offs in future periods will occur in these amounts or proportions, or
that the allocation indicates future charge-off trends. In addition to the
most recent analysis of individual loans and pools of loans, management's
methodology also places emphasis on historical loss data, delinquency and
non-accrual trends by loan classification category and expected loan
maturity. This analysis, management believes, identifies potential losses
within the loan portfolio and therefore results in allocation of a large
portion of the allowance to specific loan categories.

Centennial First's methodology for assessing the appropriateness of the
allowance consists of two key elements. The first element is the allocated
portion of the allowance, which includes specific allowances for identified
problem loans, and a loan portfolio formula allowance. The second element is
the unallocated allowance, which supplements the allocated portion. The
unallocated allowance includes management's judgmental determination of the
loan loss allowance necessary to provide for loan concentrations, economic
uncertainties and other subjective factors; and correspondingly, the
relationship of the unallocated allowance to the total allowance may
fluctuate from period to period.

The provision and allowance for loan losses also includes anticipated loan
losses on commitments to extend credit. The provision for loan losses is
calculated on the same basis for undisbursed commitments to extend credit as
it is for disbursed loans. At December 31, 2000, and December 31, 1999, the
allowance for loan losses for undisbursed commitments to extend credit was
included as part of the total allowance for loan losses as the amounts
related to loan commitments were determined to be immaterial.

NONPERFORMING ASSETS

       The Company's policy is to recognize interest income on an accrual basis
unless the full collectibility of principal and interest is uncertain. Loans
that are delinquent 90 days or more, unless well secured and in the process of
collection, are placed on nonaccrual status on a cash basis and previously
accrued but uncollected interest is reversed against income. Thereafter, income
is recognized only as it is collected in cash. Collectibility is determined by
considering the borrower's financial condition, cash flow, quality of
management, the existence of collateral or guarantees and the state of the local
economy.



                                       24
<PAGE>


       The following table provides information with respect to all
nonperforming assets.

<TABLE>
<CAPTION>
(Dollars in thousands)                    YEAR ENDED DECEMBER 31,
                                          -----------------------
                                            2000          1999
                                            ----          ----
<S>                                         <C>           <C>
Loans on nonaccrual status ........         $ 37          $ 61
Loans past due greater than 90 days           75           215
                                            ----          ----
     Total nonperforming assets ...         $112          $276
                                            ====          ====

Allowance for loan losses .........         $868          $581
Ratio of total nonperforming
 assets to total assets ...........          .27%          .36%
Ratio of total nonperforming
 assets to total loans ............          .42%          .52%
Ratio of nonperforming assets
 to total allowance for loan losses         12.9%         47.5%
</TABLE>

DEPOSITS

       The following table sets forth, by time remaining to maturity, all time
certificates of deposit accounts over $100,000 outstanding at December 31, 2000.

<TABLE>
<CAPTION>
                                                                     AS OF
(Dollars in thousands)                                        DECEMBER 31, 2000
                                                              -----------------
<S>                                                           <C>
Three months or less....................                           $ 4,596
Over three through six months...........                             4,179
Over six months to one year.............                             3,288
Over one year...........................                             1,241
                                                                  ---------
     Total..............................                           $13,304
                                                                  =========
</TABLE>

SHAREHOLDERS' EQUITY

         Total shareholders' equity for the year ended December 31, 2000
increased $542,000, or 8.6% to $6.879 million from December 31, 1999. For the
year ended December 31, 1999, total shareholders' equity increased $509,000, or
8.7% from $5.819 million at year-end 1998.

         During 2000, total shareholders' equity decreased $71,000 for the net
effect of cash dividends, and was reduced $651,000 for the purchase and
retirement of common stock. Net income of $907,000 for 2000 increased total
shareholders' equity at December 31, 2000. In 1999, total shareholders' equity
increased $92,000 for the exercise of stock options and increased $729,000 for
net earnings.



                                       25
<PAGE>

ASSET-LIABILITY MANAGEMENT AND INTEREST RATE SENSITIVITY

         The operating income and net income of the Company depend to a
substantial extent on "rate differentials," i.e., the difference between the
income the Company receives from loans, securities and other earning assets, and
the interest expense it pays on deposits and other liabilities. Interest income
and interest expense are affected by general economic conditions and by
competition in the marketplace. The Company's interest and pricing strategies
are driven by its asset-liability management analysis and by local market
conditions.

         The Company seeks to manage its assets and liabilities to generate a
stable level of earnings in response to changing interest rates and to manage
its interest rate risk. The Company further strives to serve its communities and
customers through deployment of its resources on a corporate-wide basis so that
qualified loan demands may be funded. Asset/liability management involves
managing the relationship between interest rate sensitive assets and interest
rate sensitive liabilities.

         The interest rate sensitivity of the Company is measured over time and
is based on the Company's ability to reprice its assets and liabilities. The
opportunity to reprice assets in the same dollar amounts and at the same time as
liabilities would minimize interest rate risk in any interest rate environment.
The difference between the amount of assets and liabilities repriced at the same
time is referred to as the "gap." This gap represents the risk, or opportunity,
in repricing. In general, if more assets than liabilities are repriced at a
given time in a rising rate environment, net interest income would improve, and
in a declining rate environment, net interest income would deteriorate. If more
liabilities than assets were repriced under the same conditions, the opposite
results would prevail. The Company is asset sensitive and its near term
performance could be enhanced by rising rates and negatively affected by falling
rates due mainly to the significant amount of earning assets tied to prime.

         INTEREST RATE RISK. The table below shows the potential change in NIM
(before taxes) if rates changed as of December 31, 2000. NIM is the "net
interest margin" which is the spread or difference between interest-earning
assets and interest-paying liabilities. The Company's NIM tends to increase if
rates rise, and tends to decline if rates fall. The cause of this exposure is
due to the Company's concentration of short-term and rate sensitive loans as of
December 31, 2000.

         ECONOMIC RISK. The Company establishes earnings risk limits for flat
rates, up/down 100 basis points, and up/down 200 basis points. The Company has
determined that under these scenarios, the resultant "economic value of equity"
or "EVE" should be no higher than 20% and no lower than 7%. Redlands Centennial
Bank measures the potential change in the net present value of Redlands
Centennial Bank's net existing assets and liabilities if rates change (the
"EVE"). The table below also shows the EVE. The EVE is determined by valuing the
Company assets and liabilities as of December 31, 2000, using a present value
cash flow calculation as if the Company is liquidated. The EVE increases when
rates increase because there are more variable rate assets than variable rate
liabilities.


                                       26
<PAGE>

<TABLE>
<CAPTION>
(Dollars in thousands)
                                                                 % CHANGE IN NIM TO
  CHANGE IN                    CHANGE IN NIM                     SHAREHOLDER EQUITY
INTEREST RATES             (IN THOUSANDS PRE-TAX)                     (PRE-TAX)             % OF EVE
--------------             ----------------------             ------------------------- ----------------
<S>                        <C>                                <C>                       <C>
      +2%                         $ 918                                 13.36%               (13.66%)
      +1%                           462                                  6.72%               (14.16%)
      -1%                          (471)                                (6.86%)               15.14%
      -2%                         $(946)                               (13.77%)               15.62%
</TABLE>

         The following table sets forth the repricing opportunities for the
assets and liabilities of the Company at December 31, 2000. Assets and
liabilities are classified by the earliest possible repricing date or maturity,
whichever comes first.

<TABLE>
<CAPTION>
(Dollars in thousands)                                                 FIVE
                          LESS       THREE       ONE                   YEARS
                          THAN      THROUGH    THROUGH     THREE      THROUGH      OVER       NON-
                          THREE     TWELVE      THREE     THROUGH     FIFTEEN    FIFTEEN    INTEREST
                         MONTHS      MONTHS     YEARS    FIVE YEARS    YEARS      YEARS     BEARING      TOTAL
                        ---------  --------    ---------  ---------  ---------  ---------- ----------  ---------
<S>                     <C>        <C>         <C>        <C>        <C>        <C>        <C>         <C>
Assets:
Net loans ...........   $ 42,125   $  3,711    $  5,470   $  5,514   $  2,492   $    153   $    177    $ 59,642
Investment securities                   477       3,375        924      4,653                             9,429
Federal funds sold ..      7,370                                                                          7,370
FHLB stock ..........                                           52                                           52
Interest-bearing
 deposits with banks                  2,821       1,615        344                                        4,780
Noninterest-
 earning assets .....                                                                        11,007      11,007
Life insurance ......                             1,831                                                   1,831
                        --------   --------    --------   --------   --------   --------   --------    --------
      Total assets ..   $ 49,495   $  7,009    $ 12,291   $  6,834   $  7,145   $    153   $ 11,184    $ 94,111
                        ========   ========    ========   ========   ========   ========   ========    ========

Liabilities:
Noninterest-
 bearing deposits ...                                                                        23,896      23,896
Interest-bearing
 deposits ...........     46,590     13,519       1,906        469                                       62,484
Other liabilities ...                                                                           861         861
Stockholders' equity                                                                          6,870       6,870
                                                                                           --------    --------
Total liabilities and
 stockholders' equity   $ 46,590   $ 13,519    $  1,906   $    469                         $ 31,627    $ 94,111
                        ========   ========    ========   ========   ========   ========   ========    ========
Interest rate
 sensitivity gap ....   $  2,905   $ (6,510)   $ 10,385   $  6,365   $  7,145   $    153   $(20,443)
Cumulative interest
 rate sensitivity gap   $  2,905   $ (3,605)   $  6,780   $ 13,145   $ 20,290   $ 20,443   $      0
</TABLE>



                                       27
<PAGE>


CAPITAL RESOURCES

         The Federal Reserve Board and the Federal Deposit Insurance Corporation
have established minimum requirements for capital adequacy for bank holding
companies and member banks. The requirements address both risk-based capital and
leveraged capital. The regulatory agencies may establish higher minimum
requirements if, for example, a corporation has previously received special
attention or has a high susceptibility to interest rate risk.

         The following reflects the Company's various capital ratios at December
31, 2000, as compared to regulatory minimums:

<TABLE>
<CAPTION>
                                                                    MINIMUM WELL
                                                 MINIMUM CAPITAL    CAPITALIZED
                              DECEMBER 31, 2000    REQUIREMENT      REQUIREMENT
                              -----------------  ---------------    ------------
<S>                           <C>                <C>                <C>
Tier 1 capital .........            10.24%             4%                6%
Total risk-based capital            11.49%             8%               10%
Leverage ratio .........             8.12%             4%                5%
</TABLE>

         No regulatory agency has advised the Company that it is deficient with
respect to the Tier 1 leverage-ratio. Management is unaware of any current
recommendations by regulatory authorities, which if implemented, would have a
material adverse impact on future operating results, liquidity or capital
resources.

EFFECTS OF INFLATION

         Assets and liabilities of financial institutions are principally
monetary in nature. Accordingly, interest rates, which generally move with the
rate of inflation, have a potentially significant effect on the Company's net
interest income. The Company attempts to limit inflation's impact of rates and
net income margins through a continuing asset/liability management program.



                                       28