----

----

**  June 30, 2007**

**SONOMA      VALLEY BANCORP**

| CALIFORNIA                                                  | 68-0454068                                          |
|-------------------------------------------------------------|-----------------------------------------------------|
| (State                of Incorporation)                     | (I.R.S.                Employer Identification No.) |
|                                                        |                                                |
| 202                West Napa Street Sonoma, California | 95476                                               |
| (Address                of principal executive offices)     | (Zip                Code)                           |

----

**INDEX**

| **Part                I   Financial                Information**                                                                                                                                                                                                                                                      | Page                Number |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------|
|                                                                                                                                                                                                                                                                                                                            |                       |
| Item                1.  Financial Statements (Unaudited):                                                                                                                                                                                                                                                                  |                       |
|                                                                                                                                                                                                                                                                                                                            |                       |
|    Consolidated                Balance Sheets at June                30, 2007, December 31, 2006 and June 30, 2006                                                                                                                                                                                               | 3                          |
|                                                                                                                                                                                                                                                                                                                            |                       |
|   Consolidated                Statements of Operations                for the three and six  months ended June 30, 2007 and                2006                                                                                                                                                             | 4                          |
|                                                                                                                                                                                                                                                                                                                            |                       |
|    Consolidated                Statements of Changes in                Shareholders’ Equity for the six months ended June 30, 2007,                                              and the years ended December 31, 2006 and 2005 | 5                          |
|                                                                                                                                                                                                                                                                                                                            |                       |
|    ConsolidatedStatements                of Cash Flows for                the six months ended June 30, 2007 and 2006                                                                                                                                                                                       | 7                          |
|                                                                                                                                                                                                                                                                                                                            |                       |
|    Notes                to Consolidated Financial                Statements                                                                                                                                                                                                                                      | 8                          |
|                                                                                                                                                                                                                                                                                                                            |                       |
|    Average                Balances, Yields and Rates Paid                for the six months ended June 30, 2007 and 2006                                                                                                                                                                                    | 10                         |
|                                                                                                                                                                                                                                                                                                                            |                       |
|  Item                2. Management's                Discussion and Analysis of Financial Condition and Results of                Operations                                                                                                                                                                                | 11                         |
|                                                                                                                                                                                                                                                                                                                            |                       |
|                             Average Balances, Yields                and Rates                Paid for the three months ended June 30, 2007 and 2006                                                                                                            | 24                         |
|                                                                                                                                                                                                                                                                                                                            |                       |
| Item                3.  Quantitative and Qualitative                Disclosure About Market Risk                                                                                                                                                                                                                           | 27                         |
|                                                                                                                                                                                                                                                                                                                            |                       |
|  Item                4. Controls and                Procedures                                                                                                                                                                                                                                                             | 27                         |
|                                                                                                                                                                                                                                                                                                                            |                       |
| ** Part                II Other Information**                                                                                                                                                                                                                                                                         |                       |
|                                                                                                                                                                                                                                                                                                                            |                       |
|  Item                1. Legal                Proceedings                                                                                                                                                                                                                                                                   | 28                         |
|                                                                                                                                                                                                                                                                                                                            |                       |
|  Item                2. Unregistered Sales of Equity                Securities and Use of Proceeds                                                                                                                                                                                                                         | 28                         |
|                                                                                                                                                                                                                                                                                                                            |                       |
|  Item                3. Defaults Upon Senior                Securities                                                                                                                                                                                                                                                     | 28                         |
|                                                                                                                                                                                                                                                                                                                            |                       |
|  Item                4. Submission of                Matters to a Vote of Security Holders                                                                                                                                                                                                                                 | 29                         |
|                                                                                                                                                                                                                                                                                                                            |                       |
|  Item                5. Other                Information                                                                                                                                                                                                                                                                   | 30                         |
|                                                                                                                                                                                                                                                                                                                            |                       |
|  Item                6. Exhibits                                                                                                                                                                                                                                                                                           | 30                         |
|                                                                                                                                                                                                                                                                                                                            |                       |
|  Signatures                                                                                                                                                                                                                                                                                                                | 31                         |
|                                                                                                                                                                                                                                                                                                                            |                       |
| Certifications                                                                                                                                                                                                                                                                                                                  | 32                         |

----

**PART      I**

**Item      1.**

**FINANCIAL      STATEMENTS**

**SONOMA      VALLEY BANCORP AND SUBSIDIARY**

**CONSOLIDATED      BALANCE      SHEETS**

|                                                                                                                                                                                                                                                                                                                                                                                    |   | June                30, 2007 |        |   | December                31, 2006 |   |        | June                30, 2006 |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------|-------------|--------|---------------------------------------|--------|-------------|-----------------------------------|--------|
|  ASSETS                                                                                                                                                                                                                                                                                                                                                                            |   |                              |        |   |                                  |   |        |                              |   |
|      Cash                and due from banks                                                                                                                                                                                                                                                                                                                    |   | $                                 | 6,749,796   |   |                                  | $      | 6,159,931   |                              |   | $ | 6,058,585 |   |
|     Interest-bearing                due from banks                                                                                                                                                                                                                                                                                                                  |   |                              | 180,935     |   |                                  |   | 1,292,325   |                              |   |   | 28,262 |   |
| Total                cash and cash equivalents                                                                                                                                                                                                                                                                                                                                          |   |                              | 6,930,731   |   |                                  |   | 7,452,256   |                              |   |   | 6,086,847 |   |
|     Investment                securities                available-for-sale at fair value                                                                                                                                                                                                                                                                            |   |                              | 11,078,887  |   |                                  |   | 20,991,232  |                              |   |   | 24,821,542 |   |
|     Investment                securities held-to-maturity                (fair value of $15,784,619,    $15,951,553&$15,603,131                respectively)                                                                                                                                                                                |   |                              | 15,875,285  |   |                                  |   | 15,804,421  |                              |   |   | 15,703,809 |   |
|     Loans                and lease financing receivables,                net                                                                                                                                                                                                                                                                                        |   |                              | 233,667,597 |   |                                  |   | 216,330,690 |                              |   |   | 203,120,698 |   |
|     Premises                and equipment, net                                                                                                                                                                                                                                                                                                                      |   |                              | 839,234     |   |                                  |   | 949,224     |                              |   |   | 1,082,621 |   |
|     Accrued                interest receivable                                                                                                                                                                                                                                                                                                                      |   |                              | 1,718,246   |   |                                  |   | 1,671,618   |                              |   |   | 1,523,958 |   |
|     Cash                surrender value of life                insurance                                                                                                                                                                                                                                                                                            |   |                              | 10,137,352  |   |                                  |   | 9,587,306   |                              |   |   | 9,405,245 |   |
|     Other                assets                                                                                                                                                                                                                                                                                                                                     |   |                              | 5,323,639   |   |                                  |   | 4,867,187   |                              |   |   | 4,636,920 |   |
| Total                assets                                                                                                                                                                                                                                                                                                                                                             |   | $                                 | 285,570,971 |   |                                  | $      | 277,653,934 |                              |   | $ | 266,381,640 |   |
|   LIABILITIES                                                                                                                                                                                                                                                                                                                                                                 |   |                              |        |   |                                  |   |        |                              |   |   |   |   |
|     Noninterest-bearing                demand                deposits                                                                                                                                                                                                                                                                                               |   | $                                 | 52,274,181  |   |                                  | $      | 58,740,471  |                              |   | $ | 54,729,699 |   |
|     Interest-bearing                transaction                deposits                                                                                                                                                                                                                                                                                             |   |                              | 28,910,157  |   |                                  |   | 29,983,572  |                              |   |   | 30,941,130 |   |
|     Savings                and money market                deposits                                                                                                                                                                                                                                                                                                 |   |                              | 75,134,262  |   |                                  |   | 72,346,136  |                              |   |   | 68,693,834 |   |
|     Time                deposits, $100,000 and                over                                                                                                                                                                                                                                                                                                  |   |                              | 40,834,649  |   |                                  |   | 44,067,435  |                              |   |   | 37,745,335 |   |
|     Other                time deposits                                                                                                                                                                                                                                                                                                                              |   |                              | 29,448,446  |   |                                  |   | 27,629,801  |                              |   |   | 26,450,208 |   |
| Total                deposits                                                                                                                                                                                                                                                                                                                                                           |   |                              | 226,601,695 |   |                                  |   | 232,767,415 |                              |   |   | 218,560,206 |   |
|     Other                borrowings                                                                                                                                                                                                                                                                                                                                 |   |                              | 26,300,000  |   |                                  |   | 12,600,000  |                              |   |   | 17,800,000 |   |
|     Accrued                interest payable and other                liabilities                                                                                                                                                                                                                                                                                    |   |                              | 5,761,494   |   |                                  |   | 5,882,448   |                              |   |   | 5,140,304 |   |
| Total                liabilities                                                                                                                                                                                                                                                                                                                                                        |   |                              | 258,663,189 |   |                                  |   | 251,249,863 |                              |   |   | 241,500,510 |   |
|  SHAREHOLDERS'                EQUITY                                                                                                                                                                                                                                                                                                                                               |   |                              |        |   |                                  |   |        |                              |   |   |   |   |
|     Common                stock, no par value; 10,000,000                shares authorized; 2,261,936      shares                at June 30, 2007,                2,283,047 shares at December 31, 2006      and                2,245,611 shares at                June 30, 2006 issued and outstanding |   |                              | 15,528,312  |   |                                  |   | 15,479,556  |                              |   |   | 15,383,877 |   |
|     Additional                paid-in capital                                                                                                                                                                                                                                                                                                                       |   |                              | 2,472,873   |   |                                  |   | 1,872,648   |                              |   |   | 1,466,832 |   |
|     Retained                earnings                                                                                                                                                                                                                                                                                                                                |   |                              | 9,014,327   |   |                                  |   | 9,206,716   |                              |   |   | 8,374,521 |   |
|     Accumulated                other comprehensive                loss                                                                                                                                                                                                                                                                                              |   |                              | (107,730    | )      |                                  |   | (154,849    | )                                 |   |   | (344,100 | ) |
| Total                shareholders' equity                                                                                                                                                                                                                                                                                                                                               |   |                              | 26,907,782  |   |                                  |   | 26,404,071  |                              |   |   | 24,881,130 |   |
| Total                liabilities and shareholders' equity                                                                                                                                                                                                                                                                                                                               |   | $                                 | 285,570,971 |   |                                  | $      | 277,653,934 |                              |   | $ | 266,381,640 |   |

----

**SONOMA      VALLEY BANCORP AND SUBSIDIARY**

**CONSOLIDATED      STATEMENTS OF OPERATIONS(UNAUDITED)**

|                                                                                                     |   | For                the Three Months |      |   | For                the Six Months |   |
|----------------------------------------------------------------------------------------------------------|--------|-------------------------------------|-----------|--------|-----------------------------------|--------|
|                                                                                                     |   | Ended                June 30,       |      |   | Ended                June 30,     |   |
|                                                                                                     |   | 2007                                |      |   | 2006                              |   |   | 2007 |   |   | 2006 |   |
|  INTEREST                INCOME                                                                     |   |                                |      |   |                              |   |   |   |   |   |   |   |
|   Loans                and                leases                                               |   | $                                   | 4,897,959 |   |                              | $      | 3,848,073 |   |   |  $ | 9,503,765 |   |   | $ | 7,135,537 |   |
|      Taxable                securities                                          |   |                                | 120,246   |   |                              |   | 217,616 |   |   |   | 275,677 |   |   |   | 463,107 |   |
|                     Tax-exempt securities                                            |   |                                | 154,670   |   |                              |   | 149,749 |   |   |   | 308,250 |   |   |   | 300,861 |   |
|                     Federal funds sold                                               |   |                                | 11,223    |   |                              |   | 8,965 |   |   |   | 17,675 |   |   |   | 74,102 |   |
|                     Dividends                                                        |   |                                | 15,460    |   |                              |   | 10,978 |   |   |   | 32,253 |   |   |   | 21,199 |   |
| Total                interest income                                                                     |   |                                | 5,199,558 |   |                              |   | 4,235,381 |   |   |   | 10,137,620 |   |   |   | 7,994,806 |   |
|   INTEREST                EXPENSE                                                              |   |                                |      |   |                              |   |   |   |   |   |   |   |   |   |   |   |
|     Interest-bearing                transaction deposits                             |   |                                | 12,558    |   |                              |   | 12,835 |   |   |   | 24,275 |   |   |   | 25,836 |   |
|     Savings                and money market deposits                                 |   |                                | 457,745   |   |                              |   | 305,025 |   |   |   | 923,820 |   |   |   | 549,284 |   |
|     Time                deposits, $100,000 and over                                  |   |                                | 466,664   |   |                              |   | 352,250 |   |   |   | 910,299 |   |   |   | 662,394 |   |
|     Other                time deposits                                               |   |                                | 326,342   |   |                              |   | 237,869 |   |   |   | 621,704 |   |   |   | 450,825 |   |
|     Other                borrowings                                                  |   |                                | 296,348   |   |                              |   | 123,431 |   |   |   | 542,486 |   |   |   | 123,905 |   |
| Total                interest expense                                                                    |   |                                | 1,559,657 |   |                              |   | 1,031,410 |   |   |   | 3,022,584 |   |   |   | 1,812,244 |   |
|   NET                INTEREST INCOME                                                           |   |                                | 3,639,901 |   |                              |   | 3,203,971 |   |   |   | 7,115,036 |   |   |   | 6,182,562 |   |
|     Provision                for loan and lease losses                               |   |                                | 290,000   |   |                              |   | 240,000 |   |   |   | 425,000 |   |   |   | 290,000 |   |
| NET                INTEREST INCOME AFTERPROVISION                FOR LOAN ANDLEASE                LOSSES |   |                                | 3,349,901 |   |                              |   | 2,963,971 |   |   |   | 6,690,036 |   |   |   | 5,892,562 |   |
|   NON-INTEREST                INCOME                                                           |   |                                | 579,330   |   |                              |   | 519,752 |   |   |   | 1,129,118 |   |   |   | 1,024,386 |   |
|   NON-INTEREST                EXPENSE                                                          |   |                                |      |   |                              |   |   |   |   |   |   |   |   |   |   |   |
|     Salaries                and employee benefits                                    |   |                                | 1,338,658 |   |                              |   | 1,156,326 |   |   |   | 2,786,501 |   |   |   | 2,293,020 |   |
|     Premises                and equipment                                            |   |                                | 242,074   |   |                              |   | 253,496 |   |   |   | 486,555 |   |   |   | 503,703 |   |
|     Other                                                                            |   |                                | 692,964   |   |                              |   | 562,975 |   |   |   | 1,198,951 |   |   |   | 1,180,084 |   |
| Total                non-interest expense                                                                |   |                                | 2,273,696 |   |                              |   | 1,972,797 |   |   |   | 4,472,007 |   |   |   | 3,976,807 |   |
|     Income                before provision for income taxes                          |   |                                | 1,655,535 |   |                              |   | 1,510,926 |   |   |   | 3,347,147 |   |   |   | 2,940,141 |   |
|     Provision                for income taxes                                        |   |                                | 582,377   |   |                              |   | 541,665 |   |   |   | 1,258,091 |   |   |   | 1,048,827 |   |
| NET                INCOME                                                                                |   | $                                   | 1,073,158 |   |                              | $      | 969,261 |   |   | $ | 2,089,056 |   |   | $ | 1,891,314 |   |
|                                                                                                     |   |                                |      |   |                              |   |   |   |   |   |   |   |   |   |   |   |
| NET                INCOME PER SHARE                                                                      |   | $                                   | .48       |   |                              | $      | .43 |   |   | $ | .93 |   |   | $ | .84 |   |
| NET                INCOME PER SHAREASSUMING                DILUTION                                      |   | $                                   | .46       |   |                              | $      | .41 |   |   | $ | .89 |   |   | $ | .80 |   |

----

**SONOMA      VALLEY BANCORP AND SUBSIDIARY**

**CONSOLIDATED      STATEMENTS OF CHANGES      IN SHAREHOLDERS'      EQUITY**

|                                                                                                                                                                                                                                                                                                                                                                                 |   | Comprehensive |      |   | Common                Stock |      |      | Additional                Paid-in |   |       | Retained   |   |   | Accumulated                Other Comprehensive |      |   |         |       |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------|-----------|--------|-----------------------------|-----------|-----------|-----------------------------------|--------|------------|------------|--------|--------|------------------------------------------------|-----------|--------|--------------|------------|
|                                                                                                                                                                                                                                                                                                                                                                                 |   | Income        |      |   | Shares                      |      |      | Amount                            |   |       | Capital    |   |   | Earnings                                       |      |   | (Loss)Income |       |   | Total |   |
| BALANCE AT                 JANUARY                1,                2005                                                                                                                                                                                                                                                                                              |   |          |      |   |                        | 2,142,104 |      |                              | $      | 14,512,665 |       |   | $      | 1,016,275                                      |      |   | $            | 5,295,732  |   |   | $ | (143,512 | ) |   | $ | 20,681,160 |   |
| Redemption                and                  retirement of stock                                                                                                                                                                                                                                                                                                    |   |          |      |   |                        | (5,616    | )         |                              |   | (41,165    | )          |   |   |                                           |      |   |         | (72,503    | ) |   |   |   |   |   |   | (113,668 | ) |
| Stock                options                 exercised and                related                  tax benefits                                                                                                                                                                                                                                                       |   |          |      |   |                        | 68,461    |      |                              |   | 532,635    |       |   |   | 132,337                                        |      |   |         |       |   |   |   |   |   |   |   | 664,972 |   |
| Cash                dividend                                                                                                                                                                                                                                                                                                                                                         |   |          |      |   |                        |      |      |                              |   |       |       |   |   |                                           |      |   |         | (1,078,001 | ) |   |   |   |   |   |   | (1,078,001 | ) |
| Stock                options granted                                                                                                                                                                                                                                                                                                                                                 |   |          |      |   |                        |      |      |                              |   |       |       |   |   | 103,680                                        |      |   |         |       |   |   |   |   |   |   |   | 103,680 |   |
| Net                income for the year                                                                                                                                                                                                                                                                                                                                               |   | $             | 3,348,529 |   |                        |      |      |                              |   |       |       |   |   |                                           |      |   |         |       | 3,348,529 |   |   |   |   |   |   |   | 3,348,529 |   |
| Other comprehensive                  income, net of tax:                 Unrealized holding                   losses on secuirities                   available- for-sale                   arising during the                   year, net of taxes                   of $116,709     |   |          | (166,879  | )      |                        |      |      |                              |   |       |       |   |   |                                           |      |   |         |       |   |   |   |   |   |   |   |   |   |   |
|                  Other comprehensive                   income, net of taxes                                                                                                                                                                                                                                                                                      |   |          | (166,879  | )      |                        |      |      |                              |   |       |       |   |   |                                           |      |   |         |       |   |   |   |   | (166,879 | ) |   |   | (166,879 | ) |
| Total                comprehensive   income                                                                                                                                                                                                                                                                                                                 |   | $             | 3,181,650 |   |                        |      |      |                              |   |       |       |   |   |                                           |      |   |         |       |   |   |   |   |   |   |   |   |   |   |
| BALANCE AT                 DECEMBER 31, 2005                                                                                                                                                                                                                                                                                                                               |   |          |      |   |                        |      | 2,204,949 |                              |   |       | 15,004,135 |   |   |                                           | 1,252,292 |   |         |       | 7,493,757 |   |   |   | (310,391 | ) |   |   | 23,439,793 |   |
| Redemption                and                  retirement of stock                                                                                                                                                                                                                                                                                                    |   |          |      |   |                        |      | (55,028   | )                                 |   |       | (410,308   | )      |   |                                           |      |   |         |       | (1,025,843 | ) |   |   |   |   |   |   | (1,436,151 | ) |
| Stock                options  exercised and                related                 tax benefits                                                                                                                                                                                                                                                                  |   |          |      |   |                        |      | 104,126   |                              |   |       | 885,729    |   |   |                                           | 438,757   |   |         |       |   |   |   |   |   |   |   |   | 1,324,486 |   |
| Cash                dividend                                                                                                                                                                                                                                                                                                                                                         |   |          |      |   |                        |      |      |                              |   |       |       |   |   |                                           |      |   |         |       | (1,252,957 | ) |   |   |   |   |   |   | (1,252,957 | ) |
| Stock                options granted                                                                                                                                                                                                                                                                                                                                                 |   |          |      |   |                        |      |      |                              |   |       |       |   |   |                                           | 100,224   |   |         |       |   |   |   |   |   |   |   |   | 100,224 |   |
| Restricted                stock granted                                                                                                                                                                                                                                                                                                                                              |   |          |      |   |                        |      | 29,000    |                              |   |       |       |   |   |                                           | 81,375    |   |         |       |   |   |   |   |   |   |   |   | 81,375 |   |
| Net                income for the year                                                                                                                                                                                                                                                                                                                                               |   | $             | 3,991,759 |   |                        |      |      |                              |   |       |       |   |   |                                           |      |   |         |       | 3,991,759 |   |   |   |   |   |   |   | 3,991,759 |   |
| Other comprehensive                  income, net of tax:                 Unrealized holding    gains                on secuirities                   available- for-sale                   arising during the                   year, net of taxes                   of $108,781 |   |          | 155,542   |   |                        |      |      |                              |   |       |       |   |   |                                           |      |   |         |       |   |   |   |   |   |   |   |   |   |   |
| Other                comprehensive                                  income, net of taxes                                                                                                                                                                                                                                                                                   |   |          | 155,542   |   |                        |      |      |                              |   |       |       |   |   |                                           |      |   |         |       |   |   |   |   | 155,542 |   |   |   | 155,542 |   |
| Total                comprehensive   income                                                                                                                                                                                                                                                                                                                 |   | $             | 4,147,301 |   |                        |      |      |                              |   |       |       |   |   |                                           |      |   |         |       |   |   |   |   |   |   |   |   |   |   |

----

**SONOMA      VALLEY BANCORP AND SUBSIDIARY**

**CONSOLIDATED      STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Continued)**

|                                                                                                                                                                                                                                                                                                                                                                                |   | Comprehensive |      |   | Common                Stock |      |      | Additional                Paid-in |   |       | Retained   |   |   | Accumulated                Other Comprehensive |      |   |         |       |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------|-----------|--------|-----------------------------|-----------|-----------|-----------------------------------|--------|------------|------------|--------|--------|------------------------------------------------|-----------|--------|--------------|------------|
|                                                                                                                                                                                                                                                                                                                                                                                |   | Income        |      |   | Shares                      |      |      | Amount                            |   |       | Capital    |   |   | Earnings                                       |      |   | (Loss)Income |       |   | Total |   |
| BALANCE                AT                 DECEMBER 31, 2006                                                                                                                                                                                                                                                                                                                    |   |          |      |   |                        | 2,283,047 |      |                              | $      | 15,479,556 |       |   | $      | 1,872,648                                      |      |   | $            | 9,206,716  |   |   | $ | (154,849 | ) |   | $ | 26,404,071 |   |
|                                                                                                                                                                                                                                                                                                                                                                                |   |          |      |   |                        |      |      |                              |   |       |       |   |   |                                           |      |   |         |       |   |   |   |   |   |   |   |   |   |
| Redemption                and                  retirement of stock                                                                                                                                                                                                                                                                                                   |   |          |      |   |                        | (70,912   | )         |                              |   | (486,440   | )          |   |   |                                           |      |   |         | (1,585,557 | ) |   |   |   |   |   |   | (2,071,997 | ) |
| Stock                options  exercised                and                related  related                tax                benefits                                                                                                                                                                                                                      |   |          |      |   |                        | 49,801    |      |                              |   | 535,196    |       |   |   | 327,233                                        |      |   |         |       |   |   |   |   |   |   |   | 862,429 |   |
| Cash                dividend                                                                                                                                                                                                                                                                                                                                                        |   |          |      |   |                        |      |      |                              |   |       |       |   |   |                                           |      |   |         | (695,888   | ) |   |   |   |   |   |   | (695,888 | ) |
| Stock                options granted                                                                                                                                                                                                                                                                                                                                                |   |          |      |   |                        |      |      |                              |   |       |       |   |   | 175,253                                        |      |   |         |       |   |   |   |   |   |   |   | 175,253 |   |
| Restricted                stock granted                                                                                                                                                                                                                                                                                                                                             |   |          |      |   |                        |      |      |                              |   |       |       |   |   | 97,739                                         |      |   |         |       |   |   |   |   |   |   |   | 97,739 |   |
| Net                income for the year                                                                                                                                                                                                                                                                                                                                              |   | $             | 2,089,056 |   |                        |      |      |                              |   |       |       |   |   |                                           |      |   |         |       | 2,089,056 |   |   |   |   |   |   |   | 2,089,056 |   |
| Other comprehensive                  income, net of tax:                 Unrealized holding    gains                on secuirities                   available- for-sale                   arising during the                   year, net of taxes                   of $32,953 |   |          | 47,119    |   |                        |      |      |                              |   |       |       |   |   |                                           |      |   |         |       |   |   |   |   |   |   |   |   |   |   |
| Other                comprehensive                                  income, net of taxes                                                                                                                                                                                                                                                                                  |   |          | 47,119    |   |                        |      |      |                              |   |       |       |   |   |                                           |      |   |         |       |   |   |   |   | 47,119 |   |   |   | 47,119 |   |
| Total                comprehensive   income                                                                                                                                                                                                                                                                                            |   | $             | 2,136,175 |   |                        |      |      |                              |   |       |       |   |   |                                           |      |   |         |       |   |   |   |   |   |   |   |   |   |   |
| BALANCE                AT  JUNE                30, 2007                                                                                                                                                                                                                                                                                                                   |   |          |      |   |                        |      | 2,261,936 |                              |   | $          | 15,528,312 |   |   | $                                              | 2,472,873 |   |         | $          | 9,014,327 |   |   | $ | (107,730 | ) |   | $ | 26,907,782 |   |

----

**SONOMA      VALLEY BANCORP AND SUBSIDIARY**

**CONSOLIDATED      STATEMENTS OF      CASH FLOWS(UNAUDITED)**

|                                                                                                                             |   | 2007   |        |   | 2006   |   |
|----------------------------------------------------------------------------------------------------------------------------------|--------|--------|-------------|--------|--------|--------|
| OPERATING                ACTIVITIES                                                                                              |   |   |        |   |   |   |
|   Net                income                                                                                            |   | $      | 2,089,056   |   |   | $      | 1,891,314 |   |
|   Adjustments                to reconcile net income to net cash                provided by operating activities:      |   |   |        |   |   |   |   |   |
|     Provision                for loan and lease                losses                                        |   |   | 425,000     |   |   |   | 290,000 |   |
|     Depreciation                                                                                             |   |   | 126,514     |   |   |   | 146,011 |   |
|     Amortization                and other                                                                    |   |   | 27,498      |   |   |   | 73,247 |   |
|     Stock                options and restricted stock                vested                                  |   |   | 272,992     |   |   |   | 51,346 |   |
|     Net                change in interest                receivable                                          |   |   | (46,628     | )      |   |   | (123,703 | ) |
|     Net                change in cash surrender value of                life insurance                       |   |   | (200,046    | )      |   |   | (165,806 | ) |
|     Net                change in other assets                                                                |   |   | (112,636    | )      |   |   | (282,173 | ) |
|     Net                change in interest payable and                other liabilities                       |   |   | (120,954    | )      |   |   | 275,947 |   |
| NET                CASH PROVIDED BY OPERATING ACTIVITIES                                                                         |   |   | 2,460,796   |   |   |   | 2,156,183 |   |
| INVESTING                ACTIVITIES                                                                                              |   |   |        |   |   |   |   |   |
|   Purchases                of securities held-to-maturity                                                              |   |   | (101,751    | )      |   |   | 0 |   |
|   Purchases                of securities available-for-sale                                                            |   |   | (4,195      | )      |   |   | (38,923 | ) |
|   Proceeds                from maturing securities                held-to-maturity                                     |   |   | 0           |   |   |   | 750,000 |   |
|   Proceeds                from maturing securities                available-for-sale                                   |   |   | 10,000,000  |   |   |   | 9,050,000 |   |
|   Net                change in loans and leases                                                                        |   |   | (17,761,907 | )      |   |   | (34,992,613 | ) |
|   Purchases                of premises and equipment                                                                   |   |   | (16,523     | )      |   |   | (49,966 | ) |
|   Purchases                of  life insurance                                                                |   |   | (350,000    | )      |   |   | 0 |   |
| NET                CASH USED FOR INVESTING ACTIVITIES                                                                            |   |   | (8,234,376  | )      |   |   | (25,281,502 | ) |
| FINANCING                ACTIVITIES                                                                                              |   |   |        |   |   |   |   |   |
|   Net                change in demand, interest-bearing transaction                and savings deposits                |   |   | (4,751,579  | )      |   |   | (4,900,390 | ) |
|   Net                change in time deposits                                                                           |   |   | (1,414,141  | )      |   |   | 7,701,829 |   |
|   Stock                repurchases                                                                                     |   |   | (2,071,997  | )      |   |   | (635,919 | ) |
|   Cash                dividend paid                                                                                    |   |   | (695,888    | )      |   |   | (562,566 | ) |
|   Net                change in FHLB borrowings                                                                         |   |   | 13,700,000  |   |   |   | 17,800,000 |   |
|   Stock                options exercised                                                                               |   |   | 485,660     |   |   |   | 730,871 |   |
| NET                CASH  PROVIDED BY FINANCING ACTIVITIES                                                              |   |   | 5,252,055   |   |   |   | 20,133,825 |   |
| NET                CHANGE IN CASH AND CASH EQUIVALENTS                                                                           |   |   | (521,525    | )      |   |   | (2,991,494 | ) |
|    Cash                and cash equivalents at beginning of                period                                 |   |   | 7,452,256   |   |   |   | 9,078,341 |   |
| CASH                AND CASH EQUIVALENTS AT END OF PERIOD                                                                        |   | $      | 6,930,731   |   |   | $      | 6,086,847 |   |
| SUPPLEMENTAL                DISCLOSURES OF CASH FLOW INFORMATION:                                                                |   |   |        |   |   |   |   |   |
|   Cash                paid during the year for:                                                                        |   |   |        |   |   |   |   |   |
|     Interest                expense                                                                          |   | $      | 3,021,615   |   |   | $      | 1,790,205 |   |
|     Income                taxes                                                                              |   | $      | 765,000     |   |   | $      | 855,000 |   |
| SUPPLEMENTAL                DISCLOSURES OF NONCASH ACTIVITIES:                                                                   |   |   |        |   |   |   |   |   |
|    Net                change in unrealized gains and losses on                securities                          |   | $      | 80,072      |   |   | $      | (57,284 | ) |
|    Net                change in deferred income taxes on                unrealized gains and losses on securities |   | $      | (32,953     | )      |   | $      | 23,575 |   |

----

**SONOMA      VALLEY BANCORP AND SUBSIDIARY**

**NOTES      TO CONSOLIDATED FINANCIAL      STATEMENTS**

**JUNE      30, 2007**

**(Unaudited)**

**.**

*Accounting for Stock Issued to Employees,      and related Interpretations*
*Accounting for Stock-Based Compensation, *

----

|                                                                                                       |   | Directors |     |   | Officers |   |
|------------------------------------------------------------------------------------------------------------|--------|-----------|----------|--------|----------|--------|
|                                                                                                       |   | 2007      |     |   | 2006     |   |   | 2007 |   |   | 2006 |   |
|     Service                cost                                                        |   | $         | (100,949 | )      |     | $      | 13,387 |   |   | $ | 125,999 |   |   | $ | 154,301 |   |
|     Interest                cost on projected benefit                obligation        |   |      | (59,336  | )      |     |   | 20,747 |   |   |   | 40,299 |   |   |   | (18,973 | ) |
|     Amortization                of unrecognized liability                at transition |   |      | 31,855   |   |     |   | 9,802 |   |   |   | 99,325 |   |   |   | 113,390 |   |
|     Net                periodic pension cost                recognized                 |   | $         | (128,430 | )      |     | $      | 43,936 |   |   | $ | 265,623 |   |   | $ | 248,718 |   |

----

**SONOMA      VALLEY BANCORP**

**AVERAGE      BALANCES/YIELDS AND RATES      PAID**

|                                                                                     |   | 2007                 |        |   | 2006                 |   |
|------------------------------------------------------------------------------------------|--------|----------------------|-------------|--------|----------------------|--------|
| ASSETS                                                                                   |   | Average Balance |        |   | Income/ Expense |   |   | Yield/ Rate |   |   | Average Balance |   |   | Income/ Expense |   |   | Yield/ Rate |   |
| Interest-earning                assets:                                                  |   |                 |        |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans(2):                                                                                |   |                 |        |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Commercial                                                                   |   | $                    | 152,697,374 |   |                 | $      | 6,268,267 |   |   |   | 8.28 | % |   | $ | 129,506,682 |   |   | $ | 4,998,637 |   |   |   | 7.78 | % |
|   Consumer                                                                     |   |                 | 27,855,006  |   |                 |   | 1,271,970 |   |   |   | 9.21 | % |   |   | 23,504,565 |   |   |   | 939,155 |   |   |   | 8.06 | % |
|   Real                estate construction                                      |   |                 | 28,882,815  |   |                 |   | 1,251,468 |   |   |   | 8.74 | % |   |   | 16,329,109 |   |   |   | 628,164 |   |   |   | 7.76 | % |
|   Real                estate mortgage                                          |   |                 | 17,894,432  |   |                 |   | 647,950 |   |   |   | 7.30 | % |   |   | 14,727,531 |   |   |   | 501,955 |   |   |   | 6.87 | % |
|   Tax                exempt loans (1)                                          |   |                 | 2,313,765   |   |                 |   | 94,336 |   |   |   | 8.22 | % |   |   | 2,413,275 |   |   |   | 98,315 |   |   |   | 8.22 | % |
|   Leases                                                                       |   |                 | 30,838      |   |                 |   | 1,849 |   |   |   | 12.09 | % |   |   | 47,055 |   |   |   | 2,737 |   |   |   | 11.73 | % |
|   Unearned                loan fees                                            |   |                 | (502,371    | )      |                 |   |   |   |   |   |   |   |   |   | (521,845 | ) |   |   |   |   |   |   |   |   |
|     Total                loans                                       |   |                 | 229,171,859 |   |                 |   | 9,535,840 |   |   |   | 8.39 | % |   |   | 186,006,372 |   |   |   | 7,168,963 |   |   |   | 7.77 | % |
| Investment                securities                                                     |   |                 |        |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Available                for sale:                                           |   |                 |        |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Taxable                                                          |   |                 | 15,478,259  |   |                 |   | 276,289 |   |   |   | 3.60 | % |   |   | 27,711,292 |   |   |   | 457,128 |   |   |   | 3.33 | % |
|   Hold                to maturity:                                             |   |                 |        |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Taxable                                                          |   |                 | 0           |   |                 |   | 0 |   |   |   | 0.00 | % |   |   | 353,649 |   |   |   | 5,128 |   |   |   | 2.92 | % |
|     Tax                exempt (1)                                    |   |                 | 15,833,620  |   |                 |   | 467,044 |   |   |   | 5.95 | % |   |   | 15,989,264 |   |   |   | 455,850 |   |   |   | 5.75 | % |
|     Total                investment securities                       |   |                 | 31,311,879  |   |                 |   | 743,333 |   |   |   | 4.79 | % |   |   | 44,054,205 |   |   |   | 918,106 |   |   |   | 4.20 | % |
| Federal                funds sold                                                        |   |                 | 135,359     |   |                 |   | 3,506 |   |   |   | 5.22 | % |   |   | 3,324,613 |   |   |   | 74,102 |   |   |   | 4.49 | % |
| FHLB                stock                                                                |   |                 | 1,323,471   |   |                 |   | 31,641 |   |   |   | 4.82 | % |   |   | 965,649 |   |   |   | 21,074 |   |   |   | 4.40 | % |
| Total                due from banks/interest-bearing                                     |   |                 | 545,551     |   |                 |   | 14,169 |   |   |   | 5.24 | % |   |   | 44,826 |   |   |   | 977 |   |   |   | 4.40 | % |
|   Total                interest-earning assets                                 |   |                 | 262,488,119 |   |                 | $      | 10,328,489 |   |   |   | 7.93 | % |   |   | 234,395,665 |   |   | $ | 8,183,222 |   |   |   | 7.04 | % |
| Noninterest-bearing                assets:                                               |   |                 |        |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Reserve                for loan losses                                       |   |                 | (3,467,649  | )      |                 |   |   |   |   |   |   |   |   |   | (2,852,545 | ) |   |   |   |   |   |   |   |   |
|   Cash                and due from banks                                       |   |                 | 5,700,009   |   |                 |   |   |   |   |   |   |   |   |   | 6,231,577 |   |   |   |   |   |   |   |   |   |
|   Premises                and equipment                                        |   |                 | 895,963     |   |                 |   |   |   |   |   |   |   |   |   | 1,143,444 |   |   |   |   |   |   |   |   |   |
|   Other                assets                                                  |   |                 | 15,355,485  |   |                 |   |   |   |   |   |   |   |   |   | 14,171,854 |   |   |   |   |   |   |   |   |   |
|     Total                assets                                      |   | $                    | 280,971,927 |   |                 |   |   |   |   |   |   |   |   | $ | 253,089,995 |   |   |   |   |   |   |   |   |   |
| LIABILITIES                AND SHAREHOLDERS' EQUITY                                      |   |                 |        |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   Interest-bearing                liabilities:                                 |   |                 |        |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Interest-                bearing deposits                        |   |                 |        |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                      Interest-bearing transaction               |   | $                    | 29,760,656  |   |                 | $      | 24,275 |   |   |   | 0.16 | % |   | $ | 31,270,100 |   |   | $ | 25,836 |   |   |   | 0.17 | % |
|                      Savings deposits                           |   |                 | 76,461,162  |   |                 |   | 923,820 |   |   |   | 2.44 | % |   |   | 72,933,759 |   |   |   | 549,284 |   |   |   | 1.52 | % |
|                      Time deposits over $100,000                |   |                 | 39,265,155  |   |                 |   | 910,299 |   |   |   | 4.68 | % |   |   | 35,408,931 |   |   |   | 662,394 |   |   |   | 3.77 | % |
|                      Other time deposits                        |   |                 | 28,294,316  |   |                 |   | 621,704 |   |   |   | 4.43 | % |   |   | 25,936,927 |   |   |   | 450,825 |   |   |   | 3.51 | % |
|     Total                interest-bearing deposits                   |   |                 | 173,781,289 |   |                 |   | 2,480,098 |   |   |   | 2.88 | % |   |   | 165,549,717 |   |   |   | 1,688,339 |   |   |   | 2.06 | % |
|     Federal                funds purchased                           |   |                 |        |   |                 |   |   |   |   |   |   |   |   |   | 0 |   |   |   | 0 |   |   |   | 0.00 | % |
|     Long                term debit & other borrowings            |   |                 | 21,040,525  |   |                 |   | 542,486 |   |   |   | 5.20 | % |   |   | 5,028,729 |   |   |   | 123,905 |   |   |   | 4.97 | % |
|     Total                interest-bearing liabilities                |   |                 | 194,821,814 |   |                 | $      | 3,022,584 |   |   |   | 3.13 | % |   |   | 170,578,446 |   |   | $ | 1,812,244 |   |   |   | 2.14 | % |
| Non                interest-bearing liabilities:                                         |   |                 |        |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Non                interest-bearing demand deposits              |   |                 | 53,384,933  |   |                 |   |   |   |   |   |   |   |   |   | 53,275,437 |   |   |   |   |   |   |   |   |   |
|     Other                liabilities                                 |   |                 | 5,599,916   |   |                 |   |   |   |   |   |   |   |   |   | 4,801,067 |   |   |   |   |   |   |   |   |   |
|     Shareholders'                equity                              |   |                 | 27,165,264  |   |                 |   |   |   |   |   |   |   |   |   | 24,435,045 |   |   |   |   |   |   |   |   |   |
|                      Total liabilities and shareholders' equity |   | $                    | 280,971,927 |   |                 |   |   |   |   |   |   |   |   | $ | 253,089,995 |   |   |   |   |   |   |   |   |   |
|     Interest                rate spread                              |   |                 |        |   |                 |   |   |   |   |   | 4.80 | % |   |   |   |   |   |   |   |   |   |   | 4.90 | % |
|     Interest                income                                   |   |                 |        |   |                 | $      | 10,328,489 |   |   |   | 7.93 | % |   |   |   |   |   | $ | 8,183,222 |   |   |   | 7.04 | % |
|     Interest                expense                                  |   |                 |        |   |                 |   | 3,022,584 |   |   |   | 2.32 | % |   |   |   |   |   |   | 1,812,244 |   |   |   | 1.56 | % |
|     Net                interest income/margin                        |   |                 |        |   |                 | $      | 7,305,905 |   |   |   | 5.61 | % |   |   |   |   |   | $ | 6,370,978 |   |   |   | 5.48 | % |

| (1) | Fully                tax equivalent adjustments are based on a federal income tax rate                of 34%                in 2007 and 2006.                                                                                                                                                                                                                                     |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | Non                accrual loans have been included in loans for the purposes of the                above                presentation.  Loan fees of approximately $273,773 and $173,613                for the six months ended June 30, 2007 and 2006, respectively, were                amortized to the appropriate interest income                categories. |

----

| **Item                2.** | **MANAGEMENT'S                DISCUSSION AND ANALYSIS OF                FINANCIAL CONDITION AND RESULTS OF                OPERATIONS** |
|----------------------------|----------------------------------------------------------------------------------------------------------------------------------------|

**Forward      Looking Statements**

**For      the Six Month Periods**

**Ended      June 30, 2007 and 2006**

**Overview**

----

Total      shareholders=      equity      increased 
See pages 5 and      6

**RESULTS      OF OPERATIONS**

**Net      Interest Income**

page 10
**, **

----

**Interest      Income**

**Interest      Expense**

page      10
**.**

**Provision      for Loan Losses**

----

**Non      Interest Income**

**Non-interest      Expense**

**Provision      for Income Taxes**

----

**BALANCE      SHEET ANALYSIS**

**Investments**

----

**Loans**

|                                                                                              |   | June                30, 2007 |        |   | Percentage of                Total |   |   | December                31, 2006 |   |   | Percentage of                Total |   |   | June                30, 2006 |   |   | Percentage of                Total |   |
|---------------------------------------------------------------------------------------------------|--------|-----------------------------------|-------------|--------|-----------------------------------------|--------|--------|---------------------------------------|--------|--------|-----------------------------------------|--------|--------|-----------------------------------|--------|--------|-----------------------------------------|--------|
|                                                                                              |   |                              |        |   |                                    |   |   |                                  |   |   |                                    |   |   |                              |   |   |                                    |   |
|     Commercial                                                                |   | $                                 | 160,672,241 |   |                                    |   | 67.5   | %                                     |   | $      | 146,573,119                             |   |   |                              | 66.6   | %      |                                    | $      | 149,036,419 |   |   |   | 72.1 | % |
|     Consumer                                                                  |   |                              | 27,579,460  |   |                                    |   | 11.6   | %                                     |   |   | 27,797,562                              |   |   |                              | 12.6   | %      |                                    |   | 25,384,234 |   |   |   | 12.3 | % |
|     Real                estate construction                                   |   |                              | 30,586,538  |   |                                    |   | 12.9   | %                                     |   |   | 28,590,367                              |   |   |                              | 13.0   | %      |                                    |   | 16,162,913 |   |   |   | 7.8 | % |
|     Real                estate mortgage                                       |   |                              | 18,996,051  |   |                                    |   | 8.0    | %                                     |   |   | 17,154,768                              |   |   |                              | 7.8    | %      |                                    |   | 16,187,234 |   |   |   | 7.8 | % |
|     Leases                                                                    |   |                              | 25,228      |   |                                    |   | 0.0    | %                                     |   |   | 36,030                                  |   |   |                              | 0.0    | %      |                                    |   | 49,358 |   |   |   | 0.0 | % |
|                                                                                              |   |                              | 237,859,518 |   |                                    |   | 100.0  | %                                     |   |   | 220,151,846                             |   |   |                              | 100.0  | %      |                                    |   | 206,820,158 |   |   |   | 100.0 | % |
|     Deferred                loan fees and costs, net                          |   |                              | (496,381    | )      |                                    |   |   |                                  |   |   | (544,184                                | )      |   |                              |   |   |                                    |   | (633,008 | ) |   |   |   |   |
|     Allowance                for loan and lease    losses |   |                              | (3,695,540  | )      |                                    |   |   |                                  |   |   | (3,276,972                              | )      |   |                              |   |   |                                    |   | (3,066,452 | ) |   |   |   |   |
|                                                                                              |   |                              |        |   |                                    |   |   |                                  |   |   |                                    |   |   |                              |   |   |                                    |   |   |   |   |   |   |   |
|                                                                                              |   | $                                 | 233,667,597 |   |                                    |   |   |                                  |   | $      | 216,330,690                             |   |   |                              |   |   |                                    | $      | 203,120,698 |   |   |   |   |   |

**Risk      Elements**

----

**Non-Performing      Assets**

**Allowance      for Loan Losses**

----

|                                                                                                                               |   | For                the SixMonths                Ended 6/30/07 |      |    | For                the YearEnded 12/31/06 |   |      | For                the SixMonths                Ended 6/30/06 |   |
|------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------|-----------|---------|------------------------------------------------|--------|-----------|--------------------------------------------------------------------|--------|
|     Balance                beginning of year                                                                   |   | $                                                                  | 3,276,972 |    |                                           | $      | 2,776,507 |                                                               |   | $ | 2,776,507 |   |
|     Charge-offs:                                                                                               |   |                                                               |      |    |                                           |   |      |                                                               |   |   |   |   |
|     Commercial                                                                                                 |   |                                                               | 0         |    |                                           |   | (6,593    | )                                                                  |   |   | (6,594 |  ) |
|     Consumer                                                                                                   |   |                                                               | (14,856   | )       |                                           |   | (12,262   | )                                                                  |   |   | (2,965 |  ) |
| Total                charge-offs                                                                                                   |   |                                                               | (14,856   | )       |                                           |   | (18,855   | )                                                                  |   |   | (9,559 |  ) |
|     Recoveries:                                                                                                |   |                                                               |      |    |                                           |   |      |                                                               |   |   |   |   |
|     Commercial                                                                                                 |   |                                                               | 7,954     |    |                                           |   | 17,668    |                                                               |   |   | 9,077 |   |
|     Consumer                                                                                                   |   |                                                               | 470       |    |                                           |   | 1,652     |                                                               |   |   | 427 |   |
| Total                recoveries                                                                                                    |   |                                                               | 8,424     |    |                                           |   | 19,320    |                                                               |   |   | 9,504 |   |
|                                                                                                                               |   |                                                               |      |    |                                           |   |      |                                                               |   |   |   |   |
|     Net                recoveries (charge-offs)                                                                |   |                                                               | (6,432    |  ) |                                           |   | 465       |                                                               |   |   | (55 |  ) |
|     Provision                charged to                operations                                              |   |                                                               | 425,000   |    |                                           |   | 500,000   |                                                               |   |   | 290,000 |   |
|     Balance                end of period                                                                       |   | $                                                                  | 3,695,540 |    |                                           | $      | 3,276,972 |                                                               |   | $ | 3,066,452 |   |
|     Ratio                of net charge-offs annualized to                average loans                         |   |                                                               | 0.00      | %       |                                           |   | 0.00      | %                                                                  |   |   | 0.00 | % |
|    Balance                in allowance as a                percentage  of loans outstanding at period end |   |                                                               | 1.56      | %       |                                           |   | 1.49      | %                                                                  |   |   | 1.49 | % |
|                                                                                                                               |   |                                                               |      |    |                                           |   |      |                                                               |   |   |   |   |

----

**Deposits**

page 10
**; **

|                                                                                                    |   | June                30, 2007 |        |   | Percentage of                Total |   |   | December                31, 2006 |   |   | Percentage of                Total |   |   | June                30, 2006 |   |   | Percentage of                Total |   |
|---------------------------------------------------------------------------------------------------------|--------|-----------------------------------|-------------|--------|-----------------------------------------|--------|--------|---------------------------------------|--------|--------|-----------------------------------------|--------|--------|-----------------------------------|--------|--------|-----------------------------------------|--------|
|                                                                                                    |   |                              |        |   |                                    |   |   |                                  |   |   |                                    |   |   |                              |   |   |                                    |   |
|     Interest-bearing                transaction   deposits           |   | $                                 | 28,910,157  |   |                                    |   | 12.7   | %                                     |   | $      | 29,983,572                              |   |   |                              | 12.9   | %      |                                    | $      | 30,941,130 |   |   |   | 14.2 | % |
|     Savings                deposits                                                 |   |                              | 75,134,262  |   |                                    |   | 33.2   | %                                     |   |   | 72,346,136                              |   |   |                              | 31.1   | %      |                                    |   | 68,693,834 |   |   |   | 31,4 | % |
|     Time                deposits, $100,000   and                over |   |                              | 40,834,649  |   |                                    |   | 18.0   | %                                     |   |   | 44,067,435                              |   |   |                              | 18.9   | %      |                                    |   | 37,745,335 |   |   |   | 17.3 | % |
|     Other                time deposits                                              |   |                              | 29,448,446  |   |                                    |   | 13.0   | %                                     |   |   | 27,629,801                              |   |   |                              | 11.9   | %      |                                    |   | 26,450,208 |   |   |   | 12.1 | % |
|     Total                interest-bearing    deposits           |   |                              | 174,327,514 |   |                                    |   | 76.9   | %                                     |   |   | 174,026,944                             |   |   |                              | 74.8   | %      |                                    |   | 163,830,507 |   |   |   | 75.0 | % |
|     Demand                deposits                                                  |   |                              | 52,274,181  |   |                                    |   | 23.1   | %                                     |   |   | 58,740,471                              |   |   |                              | 25.2   | %      |                                    |   | 54,729,699 |   |   |   | 25.0 | % |
|     Total                deposits                                                   |   | $                                 | 226,601,695 |   |                                    |   | 100.0  | %                                     |   | $      | 232,767,415                             |   |   |                              | 100.0  | %      |                                    | $      | 218,560,206 |   |   |   | 100.0 | % |

----

**Capital**

** **

page 12
pages 5 and 6

**Off      Balance Sheet Commitments**

----

**Liquidity      Management**

**Market      Risk Management**

*Overview*

*Asset/Liability      Management.*

----

*(In      thousands)*

| Variation                from a constant rate scenario |   | $                Change in NII |   |
|--------------------------------------------------------|--------|--------------------------------|--------|
| +200bp                                                 |   | $                              | (410   | ) |
| +100bp                                                 |   | $                              | (205   | ) |
| -100bp                                                 |   | $                              | (398   | ) |
| -200bp                                                 |   | $                              | (715   | ) |

*Interest      Rate Sensitivity Analysis*

----

|    JUNE                30, 2007                |   | Immediate Reprice |    |   | Up                to 3 Months |   |    | 4                to 6 Months |   |   | 7                to 12 Months |   |   | Over                12 Months |    |   | Total  |   |
|---------------------------------------------------------------|--------|------------------------|---------|--------|------------------------------------|--------|---------|-----------------------------------|--------|--------|------------------------------------|--------|--------|------------------------------------|---------|--------|--------|--------|
|     FFS                + overnight IBB    |   | $                      | 181     |   |                               |   |    |                              |   |   |                               |   |   |                               |    |   |   | $      | 181 |   |
|     Securities                + Other IBB |   |                   | 0       |   |                               | $      | 1,170   |                              |   | $      | 2,213                              |   |   | $                                  | 4,427   |   |   | $      | 19,144 |   |   |   | 26,954 |   |
|     Loans                                 |   |                   | 69,231  |   |                               |   | 9,692   |                              |   |   | 16,075                             |   |   |                               | 29,853  |   |   |   | 108,817 |   |   |   | 233,668 |   |
| **    Total                RSA**          |   | $                      | 69,412  |   |                               | $      | 10,862  |                              |   | $      | 18,288                             |   |   | $                                  | 34,280  |   |   | $      | 127,961 |   |   | $ | 260,803 |   |
|                                                          |   |                   |    |   |                               |   |    |                              |   |   |                               |   |   |                               |    |   |   |   |   |   |   |   |   |   |
|                                                          |   |                   |    |   |                               |   |    |                              |   |   |                               |   |   |                               |    |   |   |   |   |   |   |   |   |   |
|     MMDA/NOW/SAV                          |   | $                      | 104,045 |   |                               |   |    |                              |   |   |                               |   |   |                               |    |   |   |   |   |   |   | $ | 104,045 |   |
|     CD’s<$100k                   |   |                   | 0       |   |                               | $      | 8,863   |                              |   | $      | 8,971                              |   |   | $                                  | 8,971   |   |   | $      | 2,543 |   |   |   | 29,348 |   |
|     CD’s>$100k                   |   |                   | 0       |   |                               |   | 13,996  |                              |   |   | 18,682                             |   |   |                               | 4,671   |   |   |   | 3,587 |   |   |   | 40,936 |   |
|     Borrowings                            |   |                   | 16,300  |   |                               |   | 0       |                              |   |   | 0                                  |   |   |                               | 0       |   |   |   | 10,000 |   |   |   | 26,300 |   |
| **    Total                RSL**          |   | $                      | 120,345 |   |                               | $      | 22,859  |                              |   | $      | 27,653                             |   |   | $                                  | 13,642  |   |   | $      | 16,130 |   |   | $ | 200,629 |   |
|                                                          |   |                   |    |   |                               |   |    |                              |   |   |                               |   |   |                               |    |   |   |   |   |   |   |   |   |   |
| **    GAP**                               |   | $                      | (50,933 | )      |                               | $      | (11,997 | )                                 |   | $      | (9,365                             | )      |   | $                                  | 20,638  |   |   | $      | 111,831 |   |   | $ | 60,174 |   |
|     Cumulative                            |   | $                      | (50,933 | )      |                               | $      | (62,930 | )                                 |   | $      | (72,295                            | )      |   | $                                  | (51,657 | )      |   | $      | 60,174 |   |   |   |   |   |
|     %                Assets               |   |                   | -17.9   | %      |                               |   | -22.1   | %                                 |   |   | -25.4                              | %      |   |                               | -18.1   | %      |   |   | 21.1 | % |   |   |   |   |

*Market      risk in securities.*
* *

page 15 

----

**SONOMA      VALLEY BANCORP**

**AVERAGE      BALANCES/YIELDS AND RATES      PAID**

|                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                    |    |        |   | 2007    |   |      |   |   |   |    |   |   | 2006    |        |   |   |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------|-------------|--------|---------|--------|-----------|--------|--------|--------|---------|--------|--------|---------|-------------|--------|--------|--------|
|                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                    | Average |        |   | Income/ |   |      | Yield/ |   |   | Average |   |   | Income/ |        |   | Yield/ |   |
|  ASSETS                                 |                                                                                                                                                                                                                                                                                                                                                    | Balance |        |   | Expense |   |      | Rate   |   |   | Balance |   |   | Expense |        |   | Rate   |   |
| Interest-earning                assets:                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                    |    |        |   |    |   |      |   |   |   |    |   |   |    |        |   |   |   |
| Loans(2):                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                    |    |        |   |    |   |      |   |   |   |    |   |   |    |        |   |   |   |
|   Commercial                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                    | $       | 155,574,054 |   |    | $      | 3,260,133 |   |   |   | 8.41    | %      |   | $       | 139,650,217 |   |   | $      | 2,736,560 |   |   |   | 7.86 | % |
|   Consumer                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                    |    | 28,321,532  |   |    |   | 633,930   |   |   |   | 8.98    | %      |   |    | 24,455,537  |   |   |   | 506,180 |   |   |   | 8.30 | % |
|   Real                estate construction                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                    |    | 28,692,885  |   |    |   | 627,768   |   |   |   | 8.78    | %      |   |    | 15,514,942  |   |   |   | 311,605 |   |   |   | 8.06 | % |
|   Real                estate mortgage                                                                                                                                                              |                                                                                                                                                                                                                                                                                                                                                    |    | 18,650,647  |   |    |   | 344,049   |   |   |   | 7.40    | %      |   |    | 15,046,811  |   |   |   | 259,646 |   |   |   | 6.92 | % |
|   Tax                exempt loans (1)                                                                                                                                                              |                                                                                                                                                                                                                                                                                                                                                    |    | 2,313,765   |   |    |   | 47,428    |   |   |   | 8.22    | %      |   |    | 2,413,275   |   |   |   | 49,427 |   |   |   | 8.22 | % |
|   Leases                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                    |    | 27,492      |   |    |   | 777       |   |   |   | 11.34   | %      |   |    | 52,144      |   |   |   | 1,458 |   |   |   | 11.22 | % |
|   Unearned                loan fees                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                    |    | (484,261    | )      |    |   |      |   |   |   |    |   |   |    | (571,521    | )      |   |   |   |   |   |   |   |   |
| Total                loans                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                    |    | 233,096,114 |   |    |   | 4,914,085 |   |   |   | 8.46    | %      |   |    | 196,561,405 |   |   |   | 3,864,876 |   |   |   | 7.89 | % |
| Investment                securities                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                    |    |        |   |    |   |      |   |   |   |    |   |   |    |        |   |   |   |   |   |   |   |   |   |
|   Available                for sale:                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                    |    |        |   |    |   |      |   |   |   |    |   |   |    |        |   |   |   |   |   |   |   |   |   |
| Taxable                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                    |    | 13,401,504  |   |    |   | 120,705   |   |   |   | 3.61    | %      |   |    | 25,517,542  |   |   |   | 214,506 |   |   |   | 3.37 | % |
|   Hold                to maturity:                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                    |    |        |   |    |   |      |   |   |   |    |   |   |    |        |   |   |   |   |   |   |   |   |   |
| Taxable                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                    |    | 0           |   |    |   | 0         |   |   |   | 0.00    | %      |   |    | 349,221     |   |   |   | 2,522 |   |   |   | 2.90 | % |
| Tax                exempt (1)                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                    |    | 15,867,865  |   |    |   | 234,346   |   |   |   | 5.92    | %      |   |    | 15,848,262  |   |   |   | 226,892 |   |   |   | 5.74 | % |
| Total                investment securities                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                    |    | 29,269,369  |   |    |   | 355,051   |   |   |   | 4.87    | %      |   |    | 41,715,025  |   |   |   | 443,920 |   |   |   | 4.27 | % |
| Federal                funds sold                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                    |    | 272,222     |   |    |   | 3,506     |   |   |   | 5.17    | %      |   |    | 721,889     |   |   |   | 8,965 |   |   |   | 4.98 | % |
| FHLB                Stock                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                    |    | 1,401,649   |   |    |   | 15,001    |   |   |   | 4.29    | %      |   |    | 1,054,780   |   |   |   | 10,853 |   |   |   | 4.13 | % |
| Total                due from banks/interest bearing                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                    |    | 590,421     |   |    |   | 7,718     |   |   |   | 5.24    | %      |   |    | 50,032      |   |   |   | 714 |   |   |   | 5.72 | % |
|   Total                interest-earning assets                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                    | $       | 264,629,775 |   |    | $      | 5,295,361 |   |   |   | 8.03    | %      |   | $       | 240,103,131 |   |   | $      | 4,329,328 |   |   |   | 7.23 | % |
| Non                interest-earning assets:                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                    |    |        |   |    |   |      |   |   |   |    |   |   |    |        |   |   |   |   |   |   |   |   |   |
|   Reserve                for loan losses                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                    |    | (3,579,757  | )      |    |   |      |   |   |   |    |   |   |    | (2,909,044  | )      |   |   |   |   |   |   |   |   |
|   Cash                and due from banks                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                    |    | 5,640,402   |   |    |   |      |   |   |   |    |   |   |    | 5,714,977   |   |   |   |   |   |   |   |   |   |
|   Premises                and equipment                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                    |    | 866,702     |   |    |   |      |   |   |   |    |   |   |    | 1,122,134   |   |   |   |   |   |   |   |   |   |
|   Other                assets                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                    |    | 15,524,645  |   |    |   |      |   |   |   |    |   |   |    | 14,339,485  |   |   |   |   |   |   |   |   |   |
| Total                assets                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                    | $       | 283,081,767 |   |    |   |      |   |   |   |    |   |   | $       | 258,370,683 |   |   |   |   |   |   |   |   |   |
| LIABILITIES                AND SHAREHOLDERS’ EQUITY                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                    |    |        |   |    |   |      |   |   |   |    |   |   |    |        |   |   |   |   |   |   |   |   |   |
| Interest-bearing                liabilities:                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                    |    |        |   |    |   |      |   |   |   |    |   |   |    |        |   |   |   |   |   |   |   |   |   |
|   Interest-bearing                deposits                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                    |    |        |   |    |   |      |   |   |   |    |   |   |    |        |   |   |   |   |   |   |   |   |   |
| Interest-bearing                transaction                                                                                                                                                                  |                                                                                                                                                                                                                                                                                                                                                    | $       | 30,458,049  |   |    | $      | 12,558    |   |   |   | 0.17    | %      |   | $       | 30,947,763  |   |   | $      | 12,835 |   |   |   | 0.17 | % |
| Savings                deposits                                                                                                                                                                              |                                                                                                                                                                                                                                                                                                                                                    |    | 74,677,354  |   |    |   | 457,745   |   |   |   | 2.46    | %      |   |    | 70,765,110  |   |   |   | 305,025 |   |   |   | 1.73 | % |
| Time                deposits over $100,000                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                    |    | 39,793,806  |   |    |   | 466,664   |   |   |   | 4.70    | %      |   |    | 36,232,799  |   |   |   | 352,250 |   |   |   | 3.90 | % |
| Other                time deposits                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                    |    | 28,886,134  |   |    |   | 326,342   |   |   |   | 4.53    | %      |   |    | 26,381,272  |   |   |   | 237,870 |   |   |   | 3.62 | % |
|   Total                interest-bearing deposits                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                    |    | 173,815,343 |   |    |   | 1,263,309 |   |   |   | 2.92    | %      |   |    | 164,326,944 |   |   |   | 907,980 |   |   |   | 2.22 | % |
| Federal                funds purchased                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                    |    | 0           |   |    |   | 0         |   |   |   | 0.00    | %      |   |    | 0           |   |   |   | 0 |   |   |   |   |   |
|   Other                short-term borrowings                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                    |    | 23,006,846  |   |    |   | 296,348   |   |   |   | 5.17    | %      |   |    | 9,923,154   |   |   |   | 123,431 |   |   |   | 4.99 | % |
|   Total                interest-bearing liabilities                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                    |    | 196,822,189 |   |    | $      | 1,559,657 |   |   |   | 3.18    | %      |   |    | 174,250,098 |   |   | $      | 1,031,411 |   |   |   | 2.37 | % |
| Non                interest-bearing liabilities:                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                    |    |        |   |    |   |      |   |   |   |    |   |   |    |        |   |   |   |   |   |   |   |   |   |
|   Non                interest-bearing demand deposits                                                                                                                                              |                                                                                                                                                                                                                                                                                                                                                    |    | 53,637,882  |   |    |   |      |   |   |   |    |   |   |    | 54,462,745  |   |   |   |   |   |   |   |   |   |
|   Other                liabilities                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                    |    | 5,595,587   |   |    |   |      |   |   |   |    |   |   |    | 4,909,656   |   |   |   |   |   |   |   |   |   |
|   Shareholders’                equity                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                    |    | 27,026,109  |   |    |   |      |   |   |   |    |   |   |    | 24,748,184  |   |   |   |   |   |   |   |   |   |
| Total                liabilities and shareholders’ equity                                                                                                                                              |                                                                                                                                                                                                                                                                                                                                                    | $       | 283,081,767 |   |    |   |      |   |   |   |    |   |   | $       | 258,370,683 |   |   |   |   |   |   |   |   |   |
| Interest                rate spread                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                    |    |        |   |    |   |      |   |   |   | 4.85    | %      |   |    |        |   |   |   |   |   |   |   | 4.86 | % |
| Interest                income                                                                                                                                                                               |                                                                                                                                                                                                                                                                                                                                                    |    |        |   |    | $      | 5,295,361 |   |   |   | 8.03    | %      |   |    |        |   |   | $      | 4,329,328 |   |   |   | 7.23 | % |
| Interest                expense                                                                                                                                                                              |                                                                                                                                                                                                                                                                                                                                                    |    |        |   |    |   | 1,559,657 |   |   |   | 2.36    | %      |   |    |        |   |   |   | 1,031,411 |   |   |   | 1.72 | % |
| Net                interest income/margin                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                    |    |        |   |    | $      | 3,735,704 |   |   |   | 5.67    | %      |   |    |        |   |   | $      | 3,297,917 |   |   |   | 5.51 | % |
|  (1)                                                                                                                                                                                                    | Fully              tax equivalent adjustment are based on federal income tax rate of 34%              in              2007 and 2006.                                                                                                                                                                                                                    |
| (2)                                                                                                                                                                                                     | Non              accrual loans have been included in loans for the purposes of the above              presentation. Loan fees of approximately $121,065 and $99,469 for the              three months ended June 30, 2007 and June 30, 2006, respectively, were              amortized to the appropriate interest income              categories. |

----

**For      the Three Month Periods**

**Ended      June 30, 2007 and 2006**

**Overview**

page 4

**RESULTS      OF OPERATIONS**

**Net      Interest Income**

page 24

**Interest      Income**

----

**Interest      Expense**

page      24

**Provision      for Loan Losses**

**Non-interest      Income**

**Non-interest      Expense**

**Provision      for Income Taxes**

----

| **Item                3.** | **QUANTITATIVE                AND QUALITATIVE                DISCLOSURE ABOUT MARKET                RISK** |
|----------------------------|------------------------------------------------------------------------------------------------------------|

pages 21 through 23 

| **Item                4.** | **CONTROLS                AND                PROCEDURES** |
|----------------------------|-----------------------------------------------------------|

----

**Part      II**

| **Item                1.** | **LEGAL                PROCEEDINGS** |
|----------------------------|--------------------------------------|

| **Item                2.** | **UNREGISTERED                SALES OF EQUITY                SECURITIES AND USE OF                PROCEEDS** |
|----------------------------|--------------------------------------------------------------------------------------------------------------|

|                                                                                                         |   | **(a)**                                                                             |   |   | **(b)**                                                                     |   |   | **(c)**                                                                                                                                                                                   |   |   | **(d)**                                                                                                                                                                               |   |
|--------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------|--------|--------|-----------------------------------------------------------------------------|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
| **Period**                                                                                                   |   | **Total                Number of****Shares                (or Units)****Purchased** |   |   | **Average                Price paid****per                Share (or Unit)** |   |   | **Total                Number of****Shares                (or Units)****Purchased                as Part****of                Publicly****Announced                Plans or****Programs** |   |   | **Maximum                Number (or Approximate Dollar Value) of Shares (or Units) that May                Yet be                Purchased Under the Plans or Programs (1) (2)** |   |
|     Month                #1:    4/1/07-                4/30/07       |   |                                                                                | 35,253 |   |                                                                        | $      | 29.32  |                                                                                                                                                                                      |   |   | 35,253                                                                                                                                                                                |   |   |   | 33,633 |   |
|     Month                #2:    5/1/07-                5/31/07       |   |                                                                                | 19,799 |   |                                                                        | $      | 29.46  |                                                                                                                                                                                      |   |   | 19,799                                                                                                                                                                                |   |   |   | 13,834 |   |
|     Month                #3:    6/1/07–                6/30/07 |   |                                                                                | 4,739  |   |                                                                        | $      | 29.48  |                                                                                                                                                                                      |   |   | 4,739                                                                                                                                                                                 |   |   |   | 9,095 |   |
|     Total                                                                                |   |                                                                                | 59,791 |   |                                                                        | $      | 29.38  |                                                                                                                                                                                      |   |   | 59,791                                                                                                                                                                                |   |   |   |   |   |

| (1) | On                January 17, 2001 a repurchase program was approved up to                $1,000,000.  On August 21, 2002 an additional $1,000,000 was                approved.  No expiration.                                                                                                                      |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (2) | On                February 15, 2006, 60,000 shares were approved for repurchase, on                October 18, 2006 an additional 60,000 shares were approved for repurchase                and on July 18, 2007, an additional 60,000 shares were approved for                repurchase.  No                expiration. |

| **Item                3.** | **DEFAULTS                UPON SENIOR                SECURITIES** |
|----------------------------|-------------------------------------------------------------------|

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| **Item                4.** | **SUBMISSION                OF MATTERS TO A VOTE OF SECURITY                HOLDERS** |
|----------------------------|---------------------------------------------------------------------------------------|

| Nominees                            | Shares                Voted For | Shares                WithholdingAuthority/Voted                Against |
|-------------------------------------|---------------------------------|-------------------------------------------------------------------------|
| Suzanne                Brangham     | 1,962,464                       | 128,308                                                                 |
| Dale                T. Downing      | 1,971,375                       | 119,397                                                                 |
| Robert                B. Hitchcock  | 1,946,721                       | 144,051                                                                 |
| Robert                J. Nicholas   | 1,971,518                       | 119,254                                                                 |
| Angelo                C. Sangiacomo | 1,974,142                       | 116,630                                                                 |
| Mel                Switzer, Jr.     | 1,971,725                       | 119,047                                                                 |
|                                |

|  Proposal                  Number 2               |     Amend                  Company Bylaws to decrease the minimum number of directors                  authorized to 5                     and maximum number of directors authorized to                  9 |
|--------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                   |                                                                                                                                                                                                                                      |
|                                                   |                                                                                                                                                                                                                                                     |   |   |   |
|  Total                  shares voted:   |  For                                                                                                                                                                                                                                                |  Against  |  Abstain/Broker                  Non-Votes |   |
|                                                   |  1,922,380                                                                                                                                                                                                                                          |  155,242   |  13,149 |   |
|                                                   |                                                                                                                                                                                                                                                     |   |   |   |
|                                                   |                                                                                                                                                                                                                                                     |   |   |   |
|  Proposal                  Number 3               |     Approve                  2007 Equity Incentive Plan                                                                                                                                                                              |
|                                                   |                                                                                                                                                                                                                                                     |   |   |   |
|  Total                  shares voted:             |  For                                                                                                                                                                                                                                                |  Against |  Abstain/Broker                  Non-Votes |   |
|                                                   | 1,845,265                                                                                                                                                                                                                                           |  188,822 |  56,682 |   |
|                                                   |                                                                                                                                                                                                                                                     |   |   |   |
|                                                   |                                                                                                                                                                                                                                                     |   |   |   |
|  Proposal                  Number 4               |     Ratification                  of Richardson and Company                                                                                                                                                                          |
|                                                   |                                                                                                                                                                                                                                                     |   |   |   |
|  Total                  shares voted:             |  For                                                                                                                                                                                                                                                |  Against |  Abstain/Broker                  Non-Votes |   |
|                                                   |  1,976,518                                                                                                                                                                                                                                          |  94,330 |  19,922 |   |
|                                                   |                                                                                                                                                                                                                                                     |   |   |   |
|                                                   |                                                                                                                                                                                                                                                     |   |   |   |
|  Proposal                  Number 5               |                     Proposal on residency requirement                                                                                                                                                                                     |
|                                                   |                                                                                                                                                                                                                                                     |   |   |   |
|  Total                  shares voted:             |  For                                                                                                                                                                                                                                                |  Against |  Abstain/Broker                  Non-Votes |   |
|                                                   |  289,208                                                                                                                                                                                                                                            |  1,182,513 |  619,051 |   |

----

| **Item                5.** | **OTHER                INFORMATION** |
|----------------------------|--------------------------------------|

| **Item                6.** | **EXHIBITS** |
|----------------------------|--------------|

**Exhibits**

|   | 31.1 | Certification                of Principal Executive Officer pursuant to Section 302 of the                Sarbanes-Oxley Act                                                            |
|--------|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | 31.2 | Certification                of Principal Financial Officer and Principal Accounting                Officer  pursuant to Section 302 of the Sarbanes-Oxley                Act |
|   | 32   | Certification                of CEO and CFO pursuant to Section 906 of the Sarbanes-Oxley                Act                                                                            |

----

**SIGNATURES**

|   |                                                              |   | **SONOMA                VALLEY BANCORP**                                                                      |   |
|--------|-------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------|--------|
|   |                                                              |   | (Registrant)                                                                                                  |   |
|   |                                                              |   |                                                                                                          |   |
|   |                                                              |   |                                                                                                          |   |
| Date:  |       August                8, 2007 |   | /s/                Mel Switzer, Jr.                                                                           |   |
|   |                                                              |   | Mel                Switzer, Jr.                                                                               |   |
|   |                                                              |   | President                and Chief Executive Officer                                                          |   |
|   |                                                              |   | (Principal                Executive Officer)                                                                  |   |
|   |                                                              |   |                                                                                                          |   |
|   |                                                              |   |                                                                                                          |   |
| Date:  |       August                8, 2007 |   | /s/                Mary Dieter Smith                                                                          |   |
|   |                                                              |   | Mary                Dieter Smith                                                                              |   |
|   |                                                              |   | Executive                Vice President and Chief Operating Officerand                Chief Financial Officer |   |
|   |                                                              |   | (Principal                Financial Officer and Principal Accounting                Officer)                  |   |

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