**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**Washington,      D.C.  20549**

**FORM      10-Q**

|       | **(Mark                One)**                                                                                                                                                                                                                                                                                                                                                                  |
|------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|       |                                                                                                                                                                                                                                                                                                                                                                                           |
| **ý** | **QUARTERLY                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE                ACT OF                1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31,                2007**                                                                                                                                                                                          |
|       |                                                                                                                                                                                                                                                                                                                                                                                           |
| **o**      | **TRANSITION                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE                ACT OF                1934 FOR THE TRANSITION PERIOD FROM                                                              TO** |

**COMMISSION      FILE NUMBER:**

**VALLEY      COMMERCE BANCORP**

| **California**                                                                                   | **46-1981399**                                      |
|--------------------------------------------------------------------------------------------------|-----------------------------------------------------|
| (State                or other jurisdiction of incorporation or organization)                    | (I.R.S.                Employer Identification No.) |
|                                                                                             |                                                |
| **200                South Court Street****Visalia,                California  93291** |
| (Address                of principal executive offices)                                     |
|                                                                                             |                                                |
| **(559)                622-9000**(Issuer’s                telephone number)                |

----

*Index*

D

| PART                I - FINANCIAL INFORMATION                                                                                                 | 3      |
|-----------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                                          |   |
| ITEM                1 - FINANCIAL STATEMENTS                                                                                                  | 4      |
|                                                                                                                                          |   |
| ITEM                2 - MANAGEMENT’S DISCUSSION AND ANALYSIS  OF                FINANCIAL CONDITION AND RESULTS OF OPERATIONS | 12     |
|                                                                                                                                          |   |
| ITEM                3 – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET                RISK                                       | 20     |
|                                                                                                                                          |   |
| ITEM                4 – CONTROLS AND PROCEDURES                                                                                         | 21     |
|                                                                                                                                          |   |
| PART                II - OTHER INFORMATION                                                                                                    | 22     |
|                                                                                                                                          |   |
| ITEM                1 LEGAL PROCEEDINGS                                                                                                       | 22     |
|                                                                                                                                          |   |
| ITEM                1A RISK FACTORS                                                                                                           | 22     |
|                                                                                                                                          |   |
| ITEM                2 UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF                PROCEEDS                                              | 22     |
|                                                                                                                                          |   |
| ITEM                3 DEFAULTS UPON SENIOR SECURITIES                                                                                         | 22     |
|                                                                                                                                          |   |
| ITEM                4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY                HOLDERS                                                      | 22     |
|                                                                                                                                          |   |
| ITEM                5 OTHER INFORMATION                                                                                                       | 22     |
|                                                                                                                                          |   |
| ITEM                6 EXHIBITS                                                                                                                | 22     |
|                                                                                                                                          |   |
| SIGNATURES                                                                                                                                    | 23     |
|                                                                                                                                          |   |
| EXHIBIT                INDEX                                                                                                                  | 24     |

----

*Index*

**PART      I**

**Forward-Looking      Information**

*Certain      matters discussed in this Quarterly Report on Form 10-Q including, but not      limited to, those described in Item 2 - Management’s Discussion and Analysis of      Financial Condition and Results of Operations, are forward-looking statements      that are subject to risks and uncertainties that could cause actual results      to      differ materially from those projected in the forward-looking statements. Such risks and uncertainties include, among others: (1) significant increases      in      competitive pressure in the banking and financial services industries; (2)      changes in the interest rate environment, which could reduce anticipated or      actual margins; (3) changes in the regulatory environment; (4) general economic      conditions, either nationally or regionally and especially in the Company’s      primary service area, becoming less favorable than expected and resulting in,      among other things, a deterioration in credit quality; (5) operational risks,      including data processing systems failures or fraud; (6) changes in business      conditions and inflation; (7) changes in technology; (8) changes in monetary      and      tax policies; and (9)changes in the securities markets; (10) civil disturbances      or terrorist threats or acts, or apprehension about the possible future      occurrences or acts of this type; (11) outbreak or escalation of hostilities      in      which the United States is involved, any declaration of war by the U.S. Congress      or any other national or international calamity, crisis or emergency; (12)      changes in laws and regulations; (13) recently issued accounting pronouncements;      (14) government policies, regulations, and their enforcement      including  Bank Secrecy Act-related matters, taxing statutes and      regulations; (15) restrictions on dividends that our subsidiaries are allowed      to      pay to us; (16) the ability to satisfy requirements related to the      Sarbanes-Oxley Act and other regulation on internal control; and (17)      management’s ability to manage these and other risks.  Therefore, the      information set forth in such forward-looking statements should be carefully      considered when evaluating the business prospects of the      Company.*

*When      the Company uses in this Quarterly Report on Form 10-Q the words “anticipate,”“estimate,” “expect,” “project,” “intend,” “commit,” “believe” and similar      expressions, the Company intends to identify forward-looking statements. Such statements are not guarantees of performance and are subject to certain      risks, uncertainties and assumptions, including those described in this      Quarterly Report on Form 10-Q.  Should one or more of these risks or      uncertainties materialize, or should underlying assumptions prove incorrect,      actual results may vary materially from those anticipated, estimated, expected,      projected, intended, committed or believed.  The future results and      shareholder values of the Company may differ materially from those expressed      in      these forward-looking statements.  Many of the factors that will determine      these results and values are beyond the Company’s ability to control or      predict.  The Company undertakes no obligation to revise or publicly      release the results of any revision to these forward-looking      statements.  For those statements, the Company claims the protection      of the safe harbor for forward-looking statements contained in the Private      Securities Litigation Reform Act of 1995.*

----

*Index*

**ITEM      1 – FINANCIAL STATEMENTS**

**VALLEY      COMMERCE BANCORP**

**CONDENSED      CONSOLIDATED BALANCE SHEET**

**(UNAUDITED)**

|                                                                                                                                                                                                                                      |   | **March                  31,****2007** |        |   | **December                  31,****2006** |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------|-------------|--------|-------------------------------------------|--------|
|                                                                                                                                                                                                                                      |   |                                   |        |   |                                      |   |
| **Assets**                                                                                                                                                                                                                                |   |                                   |        |   |                                      |   |
| Cash                  and due from banks                                                                                                                                                                                                  |   | $                                      | 7,879,704   |   |                                      | $      | 13,265,547 |   |
| Available-for-sale                  investment securities, at fair value                                                                                                                                                                  |   |                                   | 53,247,000  |   |                                      |   | 55,298,000 |   |
| Loans,                  less allowance for loan losses of $1,751,799 at March 31, 2007                  and                  $1,745,582 at December 31, 2006                                                                              |   |                                   | 188,532,588 |   |                                      |   | 182,331,506 |   |
| Bank                  premises and equipment, net                                                                                                                                                                                         |   |                                   | 1,947,117   |   |                                      |   | 1,832,177 |   |
| Cash                  surrender value of bank-owned life insurance                                                                                                                                                                        |   |                                   | 5,995,851   |   |                                      |   | 5,934,563 |   |
| Accrued                  interest receivable and other assets                                                                                                                                                                             |   |                                   | 5,079,689   |   |                                      |   | 5,002,900 |   |
| Total                  assets                                                                                                                                                                                                             |   | $                                      | 262,681,949 |   |                                      | $      | 263,664,693 |   |
|                                                                                                                                                                                                                                      |   |                                   |        |   |                                      |   |   |   |
| **Liabilities                  and Shareholders’ Equity**                                                                                                                                                                           |   |                                   |        |   |                                      |   |   |   |
| Deposits:                                                                                                                                                                                                                                 |   |                                   |        |   |                                      |   |   |   |
| Non-interest                  bearing                                                                                                                                                                                                     |   | $                                      | 60,105,779  |   |                                      | $      | 63,019,956 |   |
| Interest                  bearing                                                                                                                                                                                                         |   |                                   | 76,290,448  |   |                                      |   | 75,292,723 |   |
| Time                                                                                                                                                                                                                                      |   |                                   | 73,333,769  |   |                                      |   | 69,263,490 |   |
| Total                  deposits                                                                                                                                                                                                           |   |                                   | 209,729,996 |   |                                      |   | 207,576,169 |   |
|                                                                                                                                                                                                                                      |   |                                   |        |   |                                      |   |   |   |
| Accrued                  interest payable and other liabilities                                                                                                                                                                           |   |                                   | 1,723,001   |   |                                      |   | 1,399,787 |   |
| Short-term                  debt                                                                                                                                                                                                          |   |                                   | 13,721,000  |   |                                      |   | 17,600,000 |   |
| Long-term                  debt                                                                                                                                                                                                           |   |                                   | 8,298,160   |   |                                      |   | 8,547,638 |   |
| Junior                  subordinated deferrable interest debentures                                                                                                                                                                       |   |                                   | 3,093,000   |   |                                      |   | 3,093,000 |   |
| Total                  liabilities                                                                                                                                                                                                        |   |                                   | 236,565,157 |   |                                      |   | 238,216,594 |   |
|                                                                                                                                                                                                                                      |   |                                   |        |   |                                      |   |   |   |
| Commitments                  and contingencies (Note 5)                                                                                                                                                                                   |   |                                   |        |   |                                      |   |   |   |
|                                                                                                                                                                                                                                      |   |                                   |        |   |                                      |   |   |   |
| Shareholders’                  equity (Note 2 and 4):                                                                                                                                                                               |   |                                   |        |   |                                      |   |   |   |
| Serial                  preferred stock - no par value; 10,000,000 shares authorized,                  noneissued                                                                                                                         |   |                                   | -           |   |                                      |   | - |   |
| Common                  stock - no par value; 30,000,000 sharesauthorized; issued and outstanding                  – 2,217,588 shares at March 31, 2007 and 2,215,765 shares at December                  31,                  2006 |   |                                   | 20,704,392  |   |                                      |   | 20,683,720 |   |
| Retained                  earnings                                                                                                                                                                                                        |   |                                   | 5,633,393   |   |                                      |   | 5,040,381 |   |
| Accumulated                  other comprehensive loss, net of taxes (Note 4)                                                                                                                                                              |   |                                   | (220,993    | )      |                                      |   | (276,002 | ) |
| Total                  shareholders’ equity                                                                                                                                                                                         |   |                                   | 26,116,792  |   |                                      |   | 25,448,099 |   |
| Total                  liabilities and shareholders’ equity                                                                                                                                                                         |   | $                                      | 262,681,949 |   |                                      | $      | 263,664,693 |   |
|                                                                                                                                                                                                                                      |   |                                   |        |   |                                      |   |   |   |
|                                                                                                                                                                                                                                      |   |                                   |        |   |                                      |   |   |   |
|                                                                                                                                                                                                                                      |   |                                   |        |   |                                      |   |   |   |

| See                  notes to unaudited condensed consolidated financial                  statements.  |
|-------------------------------------------------------------------------------------------------------------|

----

*Index*

**VALLEY      COMMERCE      BANCORP**

**CONDENSED      CONSOLIDATED STATEMENT OF INCOME**

**(UNAUDITED)**

|                                                                                                                                                        |   | **For                    the Three Months** |      |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------|-----------|
|                                                                                                                                                        |   | **Ended                    March 31,**      |      |
|                                                                                                                                                        |   | **2007**                                    |      |   | **2006** |   |
|                                                                                                                                                        |   |                                        |      |   |   |   |
| **Interest                    Income:**                                                                                                                     |   |                                        |      |   |   |   |
| Interest                    and fees on loans                                                                                                               |   | $                                           | 3,840,724 |   |   | $ | 3,209,583 |   |
| Interest                    on investment securities:                                                                                                       |   |                                        |      |   |   |   |   |   |
| Taxable                                                                                                                                                     |   |                                        | 424,843   |   |   |   | 332,646 |   |
| Exempt                    from Federal income taxes                                                                                                         |   |                                        | 190,535   |   |   |   | 161,052 |   |
| Interest                    on Federal funds sold                                                                                                           |   |                                        | 334       |   |   |   | 98,975 |   |
| Total                    interest income                                                                                                                    |   |                                        | 4,456,436 |   |   |   | 3,802,256 |   |
|                                                                                                                                                        |   |                                        |      |   |   |   |   |   |
| **Interest                    Expense:**                                                                                                                    |   |                                        |      |   |   |   |   |   |
| Interest                    on deposits                                                                                                                     |   |                                        | 1,427,905 |   |   |   | 878,112 |   |
| Interest                    on short-term borrowings                                                                                                        |   |                                        | 91,421    |   |   |   | - |   |
|                        Interest on long-term borrowings                                                                                      |   |                                        | 177,377   |   |   |   | 95,792 |   |
|                        Interest on junior subordinated deferrable interest                    debentures                                     |   |                                        | 66,972    |   |   |   | 60,855 |   |
|            Total                    interest expense                                                 |   |                                        | 1,763,675 |   |   |   | 1,034,759 |   |
|                                                                                                                                                        |   |                                        |      |   |   |   |   |   |
|               Net                    interest income before provision for loan losses |   |                                        | 2,692,761 |   |   |   | 2,767,497 |   |
|                                                                                                                                                        |   |                                        |      |   |   |   |   |   |
| **Provision                    for Loan Losses**                                                                                                            |   |                                        | -         |   |   |   | - |   |
|               Net                    interest income after provision for loan losses  |   |                                        | 2,692,761 |   |   |   | 2,767,497 |   |
|                                                                                                                                                        |   |                                        |      |   |   |   |   |   |
| **Non-Interest                    Income:**                                                                                                                 |   |                                        |      |   |   |   |   |   |
| Service                    charges                                                                                                                          |   |                                        | 138,527   |   |   |   | 125,838 |   |
| Mortgage                    loan brokerage fees                                                                                                             |   |                                        | 23,770    |   |   |   | 16,290 |   |
| Earnings                    on cash surrender value of life insurance policies                                                                              |   |                                        | 63,778    |   |   |   | 27,979 |   |
| Other                                                                                                                                                       |   |                                        | 64,973    |   |   |   | 53,710 |   |
|          Total                    noninterest income                                                           |   |                                        | 291,048   |   |   |   | 223,817 |   |
|                                                                                                                                                        |   |                                        |      |   |   |   |   |   |
| **Non-Interest                    Expense:**                                                                                                                |   |                                        |      |   |   |   |   |   |
| Salaries                    and employee benefits                                                                                                           |   |                                        | 1,250,182 |   |   |   | 1,102,069 |   |
| Occupancy                    and equipment                                                                                                                  |   |                                        | 245,967   |   |   |   | 216,278 |   |
| Other                                                                                                                                                       |   |                                        | 615,648   |   |   |   | 566,958 |   |
|          Total                    noninterest expense                                                          |   |                                        | 2,111,797 |   |   |   | 1,885,305 |   |
|                                                                                                                                                        |   |                                        |      |   |   |   |   |   |
|          Income                    before provision for income taxes                                           |   |                                        | 872,012   |   |   |   | 1,106,009 |   |
|                                                                                                                                                        |   |                                        |      |   |   |   |   |   |
| **Provision                    for income taxes**                                                                                                           |   |                                        | 279,000   |   |   |   | 378,000 |   |
|                                                                                                                                                        |   |                                        |      |   |   |   |   |   |
| Net                    income                                                                                                                               |   | $                                           | 593,012   |   |   | $ | 728,009 |   |
|                                                                                                                                                        |   |                                        |      |   |   |   |   |   |
| Basic                    earnings per share (Note 3)                                                                                                        |   | $                                           | 0.27      |   |   | $ | 0.33 |   |
|                                                                                                                                                        |   |                                        |      |   |   |   |   |   |
| Diluted                    earnings per share (Note 3                                                                                                       |   | $                                           | 0.26      |   |   | $ | 0.31 |   |

----

*Index*

**VALLEY      COMMERCE BANCORP**

**CONDENSED      CONSOLIDATED STATEMENT OF CASH FLOWS**

**(UNAUDITED)**

|                                                                                                                                  |   | **For                the Three Months** |       |
|---------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------|------------|
|                                                                                                                                  |   | **Ended                March 31,**      |       |
|                                                                                                                                  |   | **2007**                                |       |   | **2006** |   |
|                                                                                                                                  |   |                                    |       |   |   |   |
| **Cash                Flows from Operating Activities:**                                                                              |   |                                    |       |   |   |   |
| Net                income                                                                                                             |   | $                                       | 593,012    |   |   | $ | 728,009 |   |
|    Adjustments                to reconcile net income to net cash provided by operating                activities:     |   |                                    |       |   |   |   |   |   |
|    Provision                for loan losses                                                                            |   |                                    | -          |   |   |   | - |   |
|    Decrease                in deferred loan origination fees, net                                                      |   |                                    | (11,528    | ) |   |   | (22,928 | ) |
|    Depreciation                                                                                                        |   |                                    | 72,506     |   |   |   | 57,389 |   |
|    Amortization                of intangibles                                                                          |   |                                    | 15,635     |   |   |   | 15,634 |   |
|    Loss                on sale of equipment                                                                            |   |                                    | 1,255      |   |   |   | - |   |
|    Dividends                on Federal Home Loan Bank stock                                                            |   |                                    | (26,600    | ) |   |   | (12,300 | ) |
|    Amortization                and accretion of  investment securities, net                                  |   |                                    | 169        |   |   |   | (35,003 | ) |
|    Increase                in cash surrender value of bank owned life insurance                                        |   |                                    | (61,288    | ) |   |   | (27,979 | ) |
|    Stock-based                compensation expense                                                                     |   |                                    | 7,670      |   |   |   | 6,750 |   |
|    (Decrease)                increase in accrued interest receivable and other assets                                  |   |                                    | (345,813   | ) |   |   | 35,995 |   |
|    Increase                in accrued interest payable and other liabilities                                           |   |                                    | 187,846    |   |   |   | 209,597 |   |
|         Net                cash provided by operating activities                              |   |                                    | 432,864    |   |   |   | 955,164 |   |
|                                                                                                                                  |   |                                    |       |   |   |   |   |   |
| **Cash                Flows from Investing Activities:**                                                                              |   |                                    |       |   |   |   |   |   |
|    Proceeds                from matured and called available-for-sale investment                securities             |   |                                    | 1,615,000  |   |   |   | 500,000 |   |
|    Purchases                of available-for-sale investment securities                                                |   |                                    | -          |   |   |   | (3,284,951 | ) |
|    Proceeds                from principal repayments from available-for-sale mortgage-backed                securities |   |                                    | 536,298    |   |   |   | 472,334 |   |
|    Redemption                of Federal Home Loan Bank Stock, net                                                      |   |                                    | 369,900    |   |   |   | 166,200 |   |
|    Net                (increase) decrease  in loans                                                          |   |                                    | (6,189,554 | ) |   |   | 5,040,674 |   |
|    Purchase                of premises and equipment                                                                   |   |                                    | (188,701   | ) |   |   | (35,119 | ) |
|         Net                cash used in investing activities                                  |   |                                    | (3,857,057 | ) |   |   | 2,859,138 |   |
|                                                                                                                                  |   |                                    |       |   |   |   |   |   |
| Continued                on next page.                                                                                                |   |

----

*Index*

**VALLEY      COMMERCE BANCORP**

**CONDENSED      CONSOLIDATED STATEMENT OF CASH FLOWS**

**(UNAUDITED)**

|                                                                                                       |   | **For                the Three Months** |       |
|------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------|------------|
|                                                                                                       |   | **Ended                March 31,**      |       |
|                                                                                                       |   | **2007**                                |       |   | **2006** |   |
|                                                                                                       |   |                                    |       |   |   |   |
| **Cash                Flows from Financing Activities:**                                                   |   |                                    |       |   |   |   |
| Net                (decrease) increase in noninterest-bearing and interest-bearing                deposits |   | $                                       | (1,916,451 | ) |   | $ | 699,824 |   |
| Net                increase (decrease)  in time deposits                                         |   |                                    | 4,070,279  |   |   |   | (3,410,796 | ) |
| Proceeds                from exercised stock options                                                       |   |                                    | 13,000     |   |   |   | 1,000 |   |
| Payments                on Federal Home Loan Bank short-term advances                                      |   |                                    | (3,879,000 | ) |   |   | - |   |
| Payments                on Federal Home Loan Bank long-term advances                                       |   |                                    | (249,478   | ) |   |   | (247,121 | ) |
| Net                cash used in financing activities                                             |   |                                    | (1,961,650 | ) |   |   | (2,957,093 | ) |
|                                                                                                       |   |                                    |       |   |   |   |   |   |
| (Decrease)                increase in cash and cash equivalents                                            |   |                                    | (5,385,843 | ) |   |   | 857,209 |   |
| **Cash                and Cash Equivalents at Beginning of Year**                                          |   |                                    | 13,265,547 |   |   |   | 19,618,285 |   |
| **Cash                and Cash Equivalents at End of Period**                                              |   | $                                       | 7,879,704  |   |   | $ | 20,475,494 |   |
|                                                                                                       |   |                                    |       |   |   |   |   |   |
| **Supplemental                Disclosure of Cash Flow Information:**                                       |   |                                    |       |   |   |   |   |   |
| Cash                paid during the period for:                                                            |   |                                    |       |   |   |   |   |   |
| Interest                expense                                                                            |   | $                                       | 1,662,351  |   |   | $ | 1,074,219 |   |
| Income                taxes                                                                                |   | $                                       | 400,000    |   |   | $ | 350,000 |   |
|                                                                                                       |   |                                    |       |   |   |   |   |   |
| **Non-Cash                Investing Activities:**                                                          |   |                                    |       |   |   |   |   |   |
| Net                change in unrealized loss on available-for-sale securities                              |   | $                                       | 100,467    |   |   | $ | (121,620 | ) |
|                                                                                                       |   |                                    |       |   |   |   |   |   |
|                                                                                                       |   |                                    |       |   |   |   |   |   |
|                                                                                                       |   |                                    |       |   |   |   |   |   |
| See                notes to unaudited condensed consolidated financial                statements.          |   |

----

*Index*

**VALLEY      COMMERCE BANCORP**

**NOTES      TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

| 1. | BASIS                OF PRESENTATION |
|----|--------------------------------------|

|   | 2. | STOCK-BASED                COMPENSATION |
|--------|----|-----------------------------------------|
|   |   |   |
|--------|--------|--------|

----

*Index*

|                                                    |   | **For                  the Three Months Ended March 31, 2007** |   |
|---------------------------------------------------------|--------|----------------------------------------------------------------|--------|
|                                                    |   | **Shares**                                                     |   |  **Weighted                  Average Exercise Price** |   | **Weighted                  Average Remaining****Contractual                  Term** |   | **Aggregate                  Intrinsic****Value** |   |
| **Incentive:**                                          |   |                                                      |   |   |    |   |    |   |   |   |   |
| Options                  outstanding at January 1, 2007 |   | 34,186                                                         |   | $  |             8.61 |   |   |   |   |   |   |
| Options                  granted                        |   | -                                                              |   |   | - |   |   |   |   |   |   |
| Options                  exercised                      |   | (1,823)                                                        |   |   | 7.13 |   |   |   |   |   |   |
| Options                  cancelled                      |   | (579)                                                          |   |   | 12.09 |   |   |   |   |   |   |
| Options                  outstanding at March 31, 2007  |   | 31,784                                                         |   |   |    8.61 |   | 6.08                  years |   | $ | 394,305 |   |
| Options                  exercisable at March 31, 2007  |   | 27,378                                                         |   |   |    8.19 |   | 6.08                  years |   | $ | 351,312 |   |
|                                                    |   |                                                           |   |   |   |   |   |   |   |   |   |
| **Nonstatutory:**                                       |   |                                                           |   |   |   |   |   |   |   |   |   |
| Options                  outstanding at January 1, 2007 |   | 190,163                                                        |   | $  |             7.84 |   |   |   |   |   |   |
| Options                  granted                        |   | -                                                              |   |   | - |   |   |   |   |   |   |
| Options                  exercised                      |   | -                                                              |   |   | - |   |   |   |   |   |   |
| Options                  cancelled                      |   | -                                                              |   |   |  - |   |   |   |   |   |   |
| Options                  outstanding at March 31, 2007  |   | 190,163                                                        |   |   |   7.84 |   | 4.94                  years |   | $ | 2,506,594 |   |
| Options                  exercisable at March 31, 2007  |   | 174,887                                                        |   |   | 7.15 |   | 4.94                  years |   | $ | 2,424,531 |   |

----

*Index*

|   | 3. | EARNINGS                PER SHARE |
|--------|----|-----------------------------------|

|                                                              |   | **For                the Three Months** |      |
|-------------------------------------------------------------------|--------|-----------------------------------------|-----------|
|                                                              |   | **Ended                March 31,**      |      |
|                                                              |   | **2007**                                |      |   | **2006** |   |
| **Earnings                Per Share:**                            |   |                                    |      |   |   |   |
| Basic                earnings per share                           |   | $                                       | 0.27      |   |   | $ | 0.33 |   |
| Diluted                earnings per share                         |   | $                                       | 0.26      |   |   | $ | 0.31 |   |
| **Weighted                Average Number of Shares Outstanding:** |   |                                    |      |   |   |   |   |   |
| Basic                shares                                       |   |                                    | 2,216,292 |   |   |   | 2,191,918 |   |
| Diluted                shares                                     |   |                                    | 2,321,805 |   |   |   | 2,313,399 |   |
|                                                              |   |                                    |      |   |   |   |   |   |

| 4.   | COMPREHENSIVE                INCOME |
|----------------|-------------------------------------|

|                                                                                                                                                                                                    |   |                                    |   |   |                         |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------|--------|--------|------------------------------|--------|
|                                                                                                                                                                                                    |   | **For                the Three Months** |   |
| (In                Thousands)                                                                                                                                                                           |   | **Ended**                               |   |
|                                                                                                                                                                                                    |   | **March                31,**            |   |   | **March                31,** |   |
|                                                                                                                                                                                                    |   | **2007**                                |   |   | **2006**                     |   |
|                                                                                                                                                                                                    |   |                                    |   |   |                         |   |
| **Net                income**                                                                                                                                                                           |   | $                                       | 593    |   |                         | $      | 728 |   |
| Other                comprehensive gain/(loss):                                                                                                                                                         |   |                                    |   |   |                         |   |   |   |
|       Unrealized                holding gain/(loss) on available-for-sale        investment                securities, net of tax |   |                                    | 55     |   |                         |   | (121 | ) |
| Net                other comprehensive income                                                                                                                                                           |   | $                                       | 648    |   |                         | $      | 607 |   |

----

*Index*

| 6. | INCOME                TAXES |
|----|-----------------------------|

*Accounting for      Uncertainty in Income Taxes—an Interpretation of FASB statement No. 109*
*Accounting for Income Taxes*

*Accounting for Contingencies*

| 7. | RECENT                ACCOUNTING PRONOUNCEMENT |
|----|------------------------------------------------|

*Fair      Value Option for Financial Assets and Financial Liabilities*

*The Fair Value Option*
*for Financial Assets and      Financial Liabilities*

----

*Index*

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

*The      following discussion and analysis should be read in conjunction with the      condensed consolidated financial statements and related notes appearing in      Item      1, Financial Statements ,in this Quarterly Report on Form 10-Q and the      consolidated financial statements and notes thereto included in Valley Commerce      Bancorp’s Annual Report filed on Form 10-K for the year ended December 31,      2006.*

**Overview**

**Critical      Accounting Policies**

----

*Index*

**Results      of Operations for the Three Months Ended March 31, 2007 and      2006**

**Net      Interest Income**

| **Average                    balances and weighted average yields and costs**       |
|---------------------------------------------------------------------------------------------------------|
|                                                                                                    |
|                                                                                                    |   | **Three                    months ended March 31,**    |   |
|                                                                                                    |   |    **2007**    |   |   |    **2006**    |   |
|                                                                                                    |   |   |   |   | **Interest** |   |   | **Average** |   |   |   |   |   | **Interest** |   |   | **Average** |   |
|                                                                                                    |   | **Average** |   |   | **income/** |   |   | **Yield/** |   |   | **Average** |   |   | **income/** |   |   | **Yield/** |   |
| *(dollars                    in thousands)*                                                             |   | **Balance** |   |   | **Expense** |   |   | **Cost** |   |   | **Balance** |   |   | **Expense** |   |   | **cost** |   |
| **ASSETS**                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Federal                    funds sold                                                                   |   | $ | 26 |   |   | $ | - |   |   |   | - |   |   | $ | 9,013 |   |   | $ | 99 |   |   |   | 4.45 | % |
| Available-for-sale                    investment securities:                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Taxable                                                                         |   |   | 35,981 |   |   |   | 425 |   |   |   | 4.79 | % |   |   | 35,417 |   |   |   | 333 |   |   |   | 3.81 | % |
|     Exempt                    from Federal income taxes (1)                         |   |   | 18,930 |   |   |   | 191 |   |   |   | 6.20 | % |   |   | 16,699 |   |   |   | 161 |   |   |   | 5.92 | % |
|        Total                    securities (1)                       |   |   | 54,911 |   |   |   | 616 |   |   |   | 5.28 | % |   |   | 52,116 |   |   |   | 494 |   |   |   | 4.49 | % |
| Loans                    (2) (3)                                                                        |   |   | 184,061 |   |   |   | 3,841 |   |   |   | 8.46 | % |   |   | 150,050 |   |   |   | 3,209 |   |   |   | 8.67 | % |
|        Total                    interest-earning assets (1)          |   |   | 238,998 |   |   |   | 4,457 |   |   |   | 7.73 | % |   |   | 211,179 |   |   |   | 3,802 |   |   |   | 7.46 | % |
| Noninterest-earning                    assets, net of allowance for loan losses                    |   | 18,379 |   |   |   |   |   |   |   |   |   |   |   | 17,814 |   |   |   |   |   |   |   |   |   |
|        Total                    assets                               |   | $ | 257,377 |   |   |   |   |   |   |   |   |   |   | $ | 228,993 |   |   |   |   |   |   |   |   |   |
|                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **LIABILITIES                    AND SHAREHOLDERS’ EQUITY**                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Deposits:                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Other                    interest-bearing                                             |   | $ | 74,711 |   |   | $ | 552 |   |   |   | 3.00 | % |   | $ | 72,229 |   |   | $ | 405 |   |   |   | 2.27 | % |
|    Time                    deposits less than $100,000                                   |   |   | 21,554 |   |   |   | 254 |   |   |   | 3.46 | % |   |   | 19,545 |   |   |   | 166 |   |   |   | 3.44 | % |
|    Time                    deposits $100,000 or more                                     |   |   | 49,851 |   |   |   | 622 |   |   |   | 6.06 | % |   |   | 33,299 |   |   |   | 307 |   |   |   | 3.74 | % |
|       Total                    interest-bearing deposits                  |   |   | 146,116 |   |   |   | 1,428 |   |   |   | 3.96 | % |   |   | 125,073 |   |   |   | 878 |   |   |   | 2.85 | % |
| Short-term                    debt                                                                      |   |   | 13,430 |   |   |   | 177 |   |   |   | 5.34 | % |   |   | - |   |   |   | - |   |   |   | - |   |
| Long-term                    debt                                                                       |   |   | 8,506 |   |   |   | 92 |   |   |   | 4.39 | % |   |   | 9,054 |   |   |   | 96 |   |   |   | 4.30 | % |
| Junior                    subordinated deferrable interest debentures                                   |   |   | 3,093 |   |   |   | 67 |   |   |   | 8.79 | % |   |   | 3,093 |   |   |   | 61 |   |   |   | 8.00 | % |
|       Total                    interest-bearing liabilities               |   |   | 171,145 |   |   |   | 1,764 |   |   |   | 4.18 | % |   |   | 137,220 |   |   |   | 1,035 |   |   |   | 3.06 | % |
| Noninterest-bearing                    deposits                                                         |   |   | 58,900 |   |   |   |   |   |   |   |   |   |   |   | 68,023 |   |   |   |   |   |   |   |   |   |
| Other                    liabilities                                                                    |   |   | 1,614 |   |   |   |   |   |   |   |   |   |   |   | 1,322 |   |   |   |   |   |   |   |   |   |
|       Total                    liabilities                                |   |   | 231,659 |   |   |   |   |   |   |   |   |   |   |   | 206,565 |   |   |   |   |   |   |   |   |   |
| Shareholders’                    equity                                                           |   |   | 25,718 |   |   |   |   |   |   |   |   |   |   |   | 22,428 |   |   |   |   |   |   |   |   |   |
|       Total                    liabilities and shareholders’ equity |   | $ | 257,377 |   |   |   |   |   |   |   |   |   |   | $ | 228,993 |   |   |   |   |   |   |   |   |   |
| Net                    interest income and margin (1)                                                   |   |   |   |   |   | $ | 2,693 |   |   |   | 4.74 | % |   |   |   |   |   | $ | 2,767 |   |   |   | 5.47 | % |
|                                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| (1)  Interest                income is not presented on a taxable-equivalent basis; however, the                average yield was calculated on a taxable-equivalent basis by using                a                marginal tax rate of 34%.                                                                |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2)  Nonaccrual                loans are included in total loans.  Interest income is included                on nonaccrual loans only to the extent cash payments have been received.                No interest was received on nonaccrual loans for the periods                presented.  |
| (3)  Interest                income on loans includes amortized loan fees, net of costs, of $69                and                $206 for 2007 and 2006, respectively.                                                                                                                                 |

----

*Index*

| **Changes                in net interest income due to changes in volumes and                rates**  |
|------------------------------------------------------------------------------------------------------------|
|                                                                                                       |   |   |   |   |   |   |   |   |   |
|                                                                                                       |   | **2007                period vs 2006 period** |   |
|                                                                                                       |   | **due                to change in:** |   |
|                                                                                                       |   | **Average** |   |   | **Average** |   |   |   |   |
|                                                                                                       |   | **Volume** |   |   | **Rate                (1)** |   |   | **Total** |   |
|                                                                                                       |   |   |   |   |   |   |   |   |   |
| *(In                thousands)*                                                                            |   |   |   |   |   |   |   |   |   |
| Increase                (decrease) in interest income:                                                     |   |   |   |   |   |   |   |   |   |
| Federal                funds sold                                                                          |   | $ | (99 | ) |   | $ | - |   |   | $ | (99 | ) |
| Investment                securities                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |
|      Taxable                                                                      |   |   | 5 |   |   |   | 87 |   |   |   | 92 |   |
|  Exempt                from Federal income taxes                                                      |   |   | 33 |   |   |   | (3 | ) |   |   | 30 |   |
| Total                Securities                                                                            |   |   | 38 |   |   |   | 84 |   |   |   | 122 |   |
| Loans                                                                                                      |   |   | 727 |   |   |   | (95 | ) |   |   | 632 |   |
| Total                interest income                                                                       |   | $ | 666 |   |   | $ | (11 | ) |   | $ | 655 |   |
|                                                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |
| (Decrease)                increase in interest expense:                                                    |   |   |   |   |   |   |   |   |   |   |   |   |
| Other                interest bearing deposits                                                             |   |   | 14 |   |   |   | 133 |   |   |   | 147 |   |
| Time                deposits less than $100,000                                                            |   |   | 17 |   |   |   | 71 |   |   |   | 88 |   |
| Time                deposits $100,000 or more                                                              |   |   | 153 |   |   |   | 162 |   |   |   | 315 |   |
| Total                interest-bearing deposits                                                             |   |   | 184 |   |   |   | 366 |   |   |   | 550 |   |
| Short-term                debt                                                                             |   |   | - |   |   |   | 177 |   |   |   | 177 |   |
| Long-term                debt                                                                              |   |   | (6 | ) |   |   | 2 |   |   |   | (4 | ) |
| Junior                subordinated deferrable interest debentures                                          |   |   | - |   |   |   | 6 |   |   |   | 6 |   |
|      Total                interest expense                                        |   |   | 178 |   |   |   | 551 |   |   |   | 729 |   |
|      (Increase)                decrease in net interest income                    |   | $ | 488 |   |   | $ | (562 | ) |   | $ | (74 | ) |

|   |   |
|--------|--------|
| (1)   | Factors                contributing to both changes in rate and volume have been attributed                to                changes in rates. |
|-----------------|------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |
|--------|--------|

----

*Index*

**Provision      for Loan Losses**

**Non-Interest      Income**

|                                                                         |   |
|------------------------------------------------------------------------------|--------|
| **Non-interest                  income**                                     |   |
|                                                                         |   | **Quarter                  ended March 31,** |   |   | **Increase** |   |
| *(in                  thousands)*                                            |   | **2007** |   |   | **2006** |   |   | **(Decrease)** |   |
| Service                  charges                                             |   | $ | 138 |   |   | $ | 126 |   |   | $ | 12 |   |
| Mortgage                  loan brokerage fees                                |   |   | 24 |   |   |   | 16 |   |   |   | 8 |   |
| Earnings                  on cash surrender value of life insurance policies |   |   | 64 |   |   |   | 28 |   |   |   | 36 |   |
| Other                                                                        |   |   | 65 |   |   |   | 54 |   |   |   | 11 |   |
|      Total                  non-interest income     |   | $ | 291 |   |   | $ | 224 |   |   | $ | 67 |   |

**Non-Interest      Expense**

----

*Index*

**                                                     **

| **Non-interest                  expense**                                |   |
|--------------------------------------------------------------------------|--------|
|                                                                     |   | **Quarter                  ended March 31,** |   |   | **Increase** |   |
| *(in                  thousands)*                                        |   | **2007** |   |   | **2006** |   |   | **(Decrease)** |   |
| Salaries                  and employee benefits                          |   | $ | 1,250 |   |   | $ | 1,102 |   |   | $ | 148 |   |
| Occupancy                  and equipment                                 |   |   | 246 |   |   |   | 216 |   |   |   | 30 |   |
| Data                  processing                                         |   |   | 113 |   |   |   | 107 |   |   |   | 6 |   |
| Operations                                                               |   |   | 112 |   |   |   | 105 |   |   |   | 7 |   |
| Professional                  and legal                                  |   |   | 88 |   |   |   | 69 |   |   |   | 19 |   |
| Advertising                  and business development                    |   |   | 62 |   |   |   | 50 |   |   |   | 12 |   |
| Telephone                  and postal                                    |   |   | 49 |   |   |   | 63 |   |   |   | (14 | ) |
| Supplies                                                                 |   |   | 41 |   |   |   | 38 |   |   |   | 3 |   |
| Assessment                  and insurance                                |   |   | 33 |   |   |   | 24 |   |   |   | 9 |   |
| Amortization                  expense                                    |   |   | 15 |   |   |   | 15 |   |   |   | - |   |
| Other                  expenses                                          |   |   | 103 |   |   |   | 96 |   |   |   | 7 |   |
|      Total                  noninterest expense |   | $ | 2,112 |   |   | $ | 1,885 |   |   | $ | 227 |   |

**Provision      for Income Taxes**

**Financial      Condition**

**Investment      Securities**

----

*Index*

| **Market                  value of securities available for sale** |   |
|--------------------------------------------------------------------|--------|
|                                                               |   | **March                  31, 2007** |   |
| *(in                  thousands)*                                  |   | Amortized                  Cost |   |   | GrossUnrealized                  Gain |   |   | GrossUnrealized                  Loss |   |   | FairValue |   |
| U.S.                  government  agencies               |   | $ | 18,809 |   |   | $ | 5 |   |   | $ | (239 | ) |   | $ | 18,575 |   |
| Mortgage-backed                  securities                        |   |   | 11,905 |   |   |   | 48 |   |   |   | (215 | ) |   |   | 11,738 |   |
| Municipal                  securities                              |   |   | 18,840 |   |   |   | 163 |   |   |   | (33 | ) |   |   | 18,970 |   |
| Corporate                  debt securities                         |   |   | 4,024 |   |   |   | - |   |   |   | (60 | ) |   |   | 3,964 |   |
|     Total                                      |   | $ | 53,578 |   |   | $ | 216 |   |   | $ | (547 | ) |   | $ | 53,247 |   |

|                                                 |   | **December                  31, 2006** |   |
|------------------------------------------------------|--------|----------------------------------------|--------|
| *(in                  thousands)*                    |   | Amortized                  Cost        |   |   | GrossUnrealized                  Gain |   |   | GrossUnrealized                  Loss |   |   | FairValue |   |
| U.S.                  government  agencies |   | $                                      | 20,325 |   |   | $ | 6 |   |   | $ | (282 | ) |   | $ | 20,049 |   |
| Mortgage-backed                  securities          |   |                                   | 12,422 |   |   |   | 65 |   |   |   | (250 | ) |   |   | 12,237 |   |
| Municipal                  securities                |   |                                   | 18,950 |   |   |   | 142 |   |   |   | (36 | ) |   |   | 19,056 |   |
| Corporate                  debt securities           |   |                                   | 4,033  |   |   |   | - |   |   |   | (77 | ) |   |   | 3,956 |   |
|     Total                        |   | $                                      | 55,730 |   |   | $ | 213 |   |   | $ | (645 | ) |   | $ | 55,298 |   |

**Loans**

| *(dollars                  in  thousands)*      |   | **March                  31, 2007** |    |   | **December                  31, 2006** |   |
|-----------------------------------------------------------|--------|-------------------------------------|---------|--------|----------------------------------------|--------|
| Commercial                                                |   | $                                   | 41,983  |   |                                   |   | 22 | % |   | $ | 41,104 |   |   |   | 22 | % |
| Real                  estate – mortgage (1)         |   |                                | 94,116  |   |                                   |   | 49 |   |   |   | 92,639 |   |   |   | 50 |   |
| Real                  estate – construction         |   |                                | 48,011  |   |                                   |   | 25 |   |   |   | 44,273 |   |   |   | 24 |   |
| Agricultural                                              |   |                                | 4,996   |   |                                   |   | 3 |   |   |   | 4,693 |   |   |   | 3 |   |
| Consumer                  and other                       |   |                                | 1,603   |   |                                   |   | 1 |   |   |   | 1,805 |   |   |   | 1 |   |
|     Subtotal                          |   |                                | 190,709 |   |                                   |   | 100 | % |   |   | 184,514 |   |   |   | 100 | % |
| Deferred                  loan fees, net                  |   |                                | (424    | )      |                                   |   |   |   |   |   | (436 | ) |   |   |   |   |
| Allowance                  for loan losses                |   |                                | (1,752  | )      |                                   |   |   |   |   |   | (1,746 | ) |   |   |   |   |
|     Total                  loans, net |   | $                                   | 188,533 |   |                                   |   |   |   |   | $ | 182,332 |   |   |   |   |   |

| (1)                Consists primarily of commercial mortgage loans. |
|---------------------------------------------------------------------|
|                                                                |

----

*Index*

**Nonperforming      Assets.**

**Allowance      for Loan Losses**

| **Changes                  in allowance for loan losses**                       |   |
|---------------------------------------------------------------------------------|--------|
|                                                                            |   | **Three                  months ended March 31,** |   |
| *(dollars                  in thousands)*                                       |   | **2007** |   |   | **2006** |   |
|                                                                            |   |   |   |   |   |   |
| Balance,                  beginning                                             |   | $ | 1,746 |   |   | $ | 1,766 |   |
| Provision                  for  loan losses                           |   |   | - |   |   |   | - |   |
| Charge-offs                                                                     |   |   | - |   |   |   | - |   |
| Recoveries                                                                      |   |   | 6 |   |   |   | - |   |
| Balance,                  ending                                                |   | $ | 1,752 |   |   | $ | 1,766 |   |
|                                                                            |   |   |   |   |   |   |   |   |
| Net                  charge-offs (recoveries) to average loans outstanding |   |   | 0.00 | % |   |   | 0.00 | % |
| Average                  loans outstanding                                      |   | $ | 184,061 |   |   | $ | 150,050 |   |
| Ending                  allowance to total loans outstanding                    |   |   | 0.92 | % |   |   | 1.20 | % |
|                                                                            |   |   |   |   |   |   |   |   |

**Deposits**

|                                          |                              |
|-----------------------------------------------|-----------------------------------|
| **Deposit                Portfolio**          |                              |
| *(dollars                in thousands)*  | **March                31, 2007** |   |   | **December                31, 2006** |   |
| Noninterest                bearing            |                              | $ | 60,106 |   |   |   | 29 | % |   | $ | 63,020 |   |   |   | 30 | % |
| Interest                bearing               |                              |   | 76,290 |   |   |   | 36 |   |   |   | 75,293 |   |   |   | 36 |   |
| Time                deposits                  |                              |   | 73,334 |   |   |   | 35 |   |   |   | 69,263 |   |   |   | 34 |   |
| Total                Deposits                 |                              | $ | 209,730 |   |   |   | 100 | % |   | $ | 207,576 |   |   |   | 100 | % |

----

*Index*

**Borrowings**

**Capital      Resources**

| **Capital                  and capital adequacy ratios**                                             |   |
|------------------------------------------------------------------------------------------------------|--------|
|                                                                                                 |   | **Quarter                  ended** |   |
|                                                                                                 |   | **March                  31, 2006** |   |   | **December                  31, 2006** |   |
| *(dollars                  in thousands)*                                                            |   | **Amount** |   |   | **Ratio** |   |   | **Amount** |   |   | **Ratio** |   |
| **Leverage                  Ratio**                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| Valley                  Commerce Bancorp And                  Subsidiary                             |   | $ | 29,283 |   |   |   | 11.4 | % |   | $ | 28,654 |   |   |   | 11.1 | % |
| Minimum                  regulatory requirement                                                      |   | $ | 10,293 |   |   |   | 4.0 | % |   | $ | 10,346 |   |   |   | 4.0 | % |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Valley                  Business Bank                                                                |   | $ | 29,046 |   |   |   | 11.3 | % |   | $ | 28,336 |   |   |   | 11.0 | % |
| Minimum                  requirement for “Well-Capitalized”                  institution |   | $ | 12,860 |   |   |   | 5.0 | % |   | $ | 12,926 |   |   |   | 5.0 | % |
| Minimum                  regulatory requirement                                                      |   | $ | 10,288 |   |   |   | 4.0 | % |   | $ | 10,341 |   |   |   | 4.0 | % |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **Tier                  1 Risk-Based Capital Ratio**                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Valley                  Commerce Bancorp And                  Subsidiary                             |   | $ | 29,283 |   |   |   | 13.5 | % |   | $ | 28,654 |   |   |   | 13.5 | % |
| Minimum                  regulatory requirement                                                      |   | $ | 8,692 |   |   |   | 4.0 | % |   | $ | 8,495 |   |   |   | 4.0 | % |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Valley                  Business Bank                                                                |   | $ | 29,046 |   |   |   | 13.4 | % |   | $ | 28,336 |   |   |   | 13.4 | % |
| Minimum                  requirement for “Well-Capitalized”                  institution |   | $ | 13,033 |   |   |   | 6.0 | % |   | $ | 12,736 |   |   |   | 6.0 | % |
| Minimum                  regulatory requirement                                                      |   | $ | 8,689 |   |   |   | 4.0 | % |   | $ | 8,490 |   |   |   | 4.0 | % |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **Total                  Risk-Based Capital Ratio**                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Valley                  Commerce Bancorp And                  Subsidiary                             |   | $ | 31,035 |   |   |   | 14.3 | % |   | $ | 30,399 |   |   |   | 14.3 | % |
| Minimum                  regulatory requirement                                                      |   | $ | 17,385 |   |   |   | 8.0 | % |   | $ | 16,989 |   |   |   | 8.0 | % |
|                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Valley                  Business Bank                                                                |   | $ | 30,798 |   |   |   | 14.2 | % |   | $ | 30,081 |   |   |   | 14.2 | % |
| Minimum                  requirement for “Well-Capitalized”                  institution |   | $ | 21,722 |   |   |   | 10.0 | % |   | $ | 21,226 |   |   |   | 10.0 | % |
| Minimum                  regulatory requirement                                                      |   | $ | 17,378 |   |   |   | 8.0 | % |   | $ | 16,981 |   |   |   | 8.0 | % |

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*Index*

**Liquidity**

**ITEM      3 – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET      RISK**

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*Index*

**ITEM      4 – CONTROLS AND PROCEDURES**

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*Index*

**PART      II – OTHER INFORMATION**

**ITEM      1 – LEGAL PROCEEDINGS**

**ITEM      1A – RISK FACTORS**

**ITEM      2 – UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF      PROCEEDS**

**ITEM      3– DEFAULTS UPON SENIOR SECURITIES**

**ITEM      4– SUBMISSION OF MATTERS TO A VOTE OF SECURITY      HOLDERS**

**ITEM      5 – OTHER INFORMATION**

**ITEM      6– EXHIBITS**

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*Index*

**SIGNATURES**

|                                | VALLEY                  COMMERCE BANCORP |
|-------------------------------------|------------------------------------------|
|                                |                                     |
| Date:                  May 10, 2007 | By:                                      | /s/                  Donald A. Gilles |
|                                |                                     | Donald                  A. Gilles |
|                                |                                     | President                  and Chief Executive Officer |
|                                |                                     |
| Date:                  May 10, 2007 | By:                                      | /s/Roy                  O. Estridge  |
|                                |                                     | Roy                  O. Estridge, Chief Financial                  Officer |

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*Index*

**Exhibit Index**

| 31.1 | Rule                13a-14(a)/15d-14(a)                Certification |
|------|----------------------------------------------------------------------|
| 31.2 | Rule                13a-14(a)/15d-14(a)                Certification |
| 32.1 | Section                1350                Certifications            |