UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB


Quarterly Report Pursuant to Section 13 or 15(d) of the Securities  Exchange Act
of 1934

For the Quarter ended September 30, 2002       Commission File Number: 000-31929
                            -------------------------


                              SONOMA VALLEY BANCORP
                 (Name of small business issuer in its charter)

      CALIFORNIA                                       68-0454068
    --------------                                   --------------
(State of incorporation)                    (I.R.S. Employer Identification No.)

                              202 West Napa Street
                            Sonoma, California 95476
                                 (707) 935-3200
                               ------------------
               (Address, including zip code, and telephone number,
              including area code, of principal executive offices)
                            ------------------------




Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Securities  Exchange  Act  during the past 12 months (or for
such shorter period that the registrant was required to file such reports),  and
(2) has been subject to such filing requirements for the past 90 days.
[X] Yes [] No


The number of shares of registrant's  common stock outstanding as of November 6,
2002 was 1,394,247.

Transitional small business disclosure format.
(Check one) Yes       No   X
                -----    -----


<PAGE>





                                   FORM 10-QSB

                                TABLE OF CONTENTS


                                                    Part I                Page
                                                                          ----

Item 1.  Financial Statements

         Consolidated Balance Sheets                                         3
         Consolidated Statements of Operations                               4
         Consolidated Statements of Changes in Shareholders' Equity          5
         Consolidated Statements of Cash Flows                               7
         Average Balances/Yields and Rates Paid                              8
         Notes to Consolidated Financial Statements                          9

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

         Forward Looking Statements                                         10
         Overview-Nine Month Periods                                        10
         Results of Operations                                              10
         Balance Sheet Analysis                                             12
         Overview-Three Month Periods                                       18

Item 3.  Controls and Procedures                                            22

                                     Part II
Item 1.  Legal Proceedings                                                  22

Item 2.  Changes in Securities                                              22

Item 3.  Defaults Upon Senior Securities                                    22

Item 4.  Submission of Matters to a Vote of Security Holders                22

Item 5.  Other Information                                                  22

Item 6.  Exhibits and Reports on Form 8-K                                   22


Signatures                                                                  23




The information  furnished in these interim statements  reflects all adjustments
and  accruals  which are, in the  opinion of  management,  necessary  for a fair
statement  of the results for such  periods.  The results of  operations  in the
interim  statements  are not  necessarily  indicative of the results that may be
expected for the full year.


                                     Page 2
<PAGE>





                                     Part I

Item 1.                         FINANCIAL STATEMENTS
                       SONOMA VALLEY BANCORP AND SUBSIDIARY
                            CONSOLIDATED BALANCE SHEETS

       September 30, 2002 (Unaudited) and December 31, 2001 (Audited) and
                         September 30, 2001 (Unaudited)
<TABLE>
<S>                                                                            <C>                  <C>                 <C>

                                                                               September 30         December 31         September 30
   ASSETS                                                                         2002                 2001                2001
                                                                               ------------        ------------        -------------

Cash and due from banks                                                        $  7,618,219        $  7,150,662        $  6,454,381
Federal funds sold                                                               22,235,000          13,250,000           6,670,000
                                                                               ------------        ------------        ------------
                                         Total cash and cash equivalents         29,853,219          20,400,662          13,124,381
Investment securities held-to-maturity (fair
  value of $11,597,000, $12,143,000 and
  $12,236,000, respectively)                                                     10,912,269          11,795,980          11,703,598
Investment securities available-for-sale at fair value                            4,388,652          10,936,270          15,532,810
Loans and lease financing receivables, net                                      117,436,218         105,032,209         103,245,105
Premises and equipment, net                                                         799,961             620,652             625,939
Accrued interest receivable                                                         895,545             952,061           1,119,479
Cash surrender value of life insurance                                            7,229,242           5,030,531           2,005,236
Other assets                                                                      2,624,722           2,581,839           2,385,809
                                                                               ------------        ------------        ------------
                                                            Total assets       $174,139,828        $157,350,204        $149,742,357
                                                                               ------------        ------------        ------------
LIABILITIES
Noninterest-bearing demand deposits                                            $ 33,904,346        $ 32,296,390        $ 28,571,555
Interest-bearing transaction deposits                                            24,199,502          23,865,954          21,501,813
Savings and money market deposits                                                50,626,679          45,523,306          43,180,278
Time deposits, $100,000 and over                                                 23,967,400          17,809,990          18,425,622
Other time deposits                                                              19,824,973          18,159,339          18,858,432
                                                                               ------------        ------------        ------------
                                                          Total deposits        152,522,900         137,654,979         130,537,700
Accrued interest payable and other liabilities                                    3,075,469           3,024,163           3,072,706
                                                                               ------------        ------------        ------------
                                                       Total liabilities        155,598,369         140,679,142         133,610,406
SHAREHOLDERS' EQUITY
Common stock, no par value; 10,000,000 shares
authorized; 1,394,433 shares at September 30, 2002,
1,333,504 shares at December 31, 2001 and 1,338,532
shares at September 30, 2001 issued & outstanding.                               12,839,336          11,025,885          11,056,002
Retained earnings                                                                 5,594,567           5,483,779           4,859,714
Accumulated other comprehensive income                                              107,556             161,398             216,235
                                                                               ------------        ------------        ------------
                                              Total shareholders' equity         18,541,459          16,671,062          16,131,951
                                                                               ------------        ------------        ------------
                              Total liabilities and shareholders' equity       $174,139,828        $157,350,204        $149,742,357
                                                                               ------------        ------------        ------------
</TABLE>




                                     Page 3
<PAGE>





                      SONOMA VALLEY BANCORP AND SUBSIDIARY
                CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
<TABLE>
<S>                                                            <C>               <C>              <C>               <C>


                                                                   For the Three Months                  For the Nine Months
                                                                    Ended September 30,                   Ended September 30,
                                                                   2002              2001            2002               2001
                                                               -------------     -------------    -------------     -------------

INTEREST INCOME
  Loans and leases                                             $   2,391,314     $   2,369,655    $   7,026,433     $   6,930,307
  Taxable securities                                                  67,203           246,845          320,526           816,595
  Tax-exempt securities                                              125,914           136,967          388,610           418,064
  Federal funds sold                                                  70,407            84,858          130,959           219,399
  Dividends                                                            3,800             3,811           11,573            12,292
                                                               -------------     -------------    -------------     -------------
                                      Total interest income        2,658,638         2,842,136        7,878,101         8,396,657
INTEREST EXPENSE
  Interest-bearing transaction deposits                               22,082            35,025           66,322           120,228
  Savings and money market deposits                                  167,254           228,934          497,012           787,935
  Time deposits, $100,000 and over                                   175,805           207,547          471,704           642,680
  Other time deposits                                                136,667           214,528          403,613           706,629
  Other borrowings                                                         0                 0                0             7,221
                                                               -------------     -------------    -------------     -------------
                                     Total interest expense          501,808           686,034        1,438,651         2,264,693
                                                               -------------     ------------     -------------     -------------
                                        NET INTEREST INCOME        2,156,830         2,156,102        6,439,450         6,131,964
  Provision for loan and lease losses                                 70,000            80,000          205,000           227,000
                                                               -------------     -------------    -------------     -------------
                                        NET INTEREST INCOME
                                        AFTER PROVISION FOR
                                             LOAN AND LEASE
                                                     LOSSES        2,086,830         2,076,102        6,234,450         5,904,964

NON-INTEREST INCOME                                                  383,088           334,541        1,164,054           958,461
NON-INTEREST EXPENSE
  Salaries and employee benefits                                     878,696           884,573        2,563,429         2,363,332
  Premises and equipment                                             156,747           141,787          455,961           441,944
  Other                                                              400,550           366,616        1,195,443         1,151,488
                                                               -------------     -------------    -------------     -------------
                                 Total non-interest expense        1,435,993         1,392,976        4,214,833         3,956,764
                                                               -------------     -------------    -------------     -------------
                                    Income before provision
                                           for income taxes        1,033,925         1,017,667        3,183,671         2,906,661
  Provision for income taxes                                         346,821           356,285        1,070,762         1,001,045
                                                               -------------     -------------    -------------     -------------

                                                 NET INCOME    $     687,104     $     661,382    $   2,112,909     $   1,905,616
                                                               =============     =============    =============     =============
NET INCOME PER SHARE                                                 $   .49           $   .47         $   1.51           $  1.36
                                                                     =======           =======         ========           =======
NET INCOME PER SHARE-
ASSUMING DILUTION                                                    $   .45           $   .44         $   1.39           $  1.28
                                                                     =======           =======         ========           =======
</TABLE>


                                     Page 4
<PAGE>





                      SONOMA VALLEY BANCORP AND SUBSIDIARY

           CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

        For the nine months ended September 30, 2001 (Unaudited), and the
           years ended December 31, 2000 (Audited) and 1999 (Audited)



<TABLE>
<S>                              <C>              <C>            <C>              <C>              <C>                <C>
                                                                                                    Accumulated
                                                                                                       Other
                                 Comprehensive          Common  Stock               Retained       Comprehensive
                                    Income          Shares          Amount          Earnings          Income             Total
                                 -------------    ---------      ------------     ------------     --------------     ------------

BALANCE AT
   JANUARY 1, 2000                                1,230,161      $  8,534,744     $  3,671,578     $     (151,644)    $ 12,054,678

5% stock dividend                                    60,605         1,068,160       (1,068,160)
Fractional shares                                                                       (7,912)                             (7,912)
Redemption and retirement
  of stock                                          (14,168)          (91,667)        (160,665)                           (252,332)
Stock options exercised and
 related tax benefits                                 5,082            73,766                                               73,766
Net income for the year          $  2,206,710                                        2,206,710                           2,206,710
Other comprehensive loss,
  net of tax:
  Unrealized holding losses
    on securities available-
    for-sale arising during
    the year, net of taxes
    of $161,088                       230,336
                                 ------------
Other comprehensive loss,
  net of taxes                        230,336                                                             230,336          230,336
                                 ------------     ---------      ------------     ------------     --------------     ------------

Total comprehensive income       $  2,437,046
                                 ============

BALANCE AT
  DECEMBER 31, 2000                               1,281,680      $  9,585,003     $  4,641,551     $       78,692     $ 14,305,246

5% stock dividend                                    63,104         1,381,976       (1,381,976)
Fractional shares                                                                      (11,955)                            (11,955)
Redemption and retirement
  of stock                                          (27,717)         (207,323)        (364,085)                           (571,408)
Stock options exercised and
  related tax benefits                               16,437           266,229                                              266,229
Net income for the year          $  2,600,244                                        2,600,244                           2,600,244
Other comprehensive income,
  net of tax:
  Unrealized holding gains
    on securities available-
    for-sale arising during
    the year, net of taxes
    of $57,842                         82,706
                                 ------------
Other comprehensive income,
  net of taxes                          82,706                                                             82,706           82,706
                                 -------------    ---------      ------------     ------------     --------------     ------------

Total comprehensive income       $   2,682,950
                                 =============
</TABLE>


                                     Page 5
<PAGE>





                      SONOMA VALLEY BANCORP AND SUBSIDIARY
     CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (Continued)

 For the nine months ended September 30, 2002 (Unaudited), and the years ended
                 December 31, 2001 (Audited) and 2000 (Audited)


<TABLE>
<S>                              <C>              <C>            <C>              <C>              <C>                <C>
                                                                                                    Accumulated
                                                                                                      Other
                                 Comprehensive         Common  Stock               Retained        Comprehensive
                                   Income          Shares           Amount         Earnings           Income              Total
                                 -------------    ---------      ------------     ------------     --------------     ------------


BALANCE AT
  DECEMBER 31, 2001                               1,333,504      $ 11,025,885     $  5,483,779     $      161,398     $ 16,671,062

Stock dividend                                       65,742         1,775,026       (1,775,026)
Fractional shares                                                                      (13,951)                            (13,951)
Redemption and retirement
  of stock                                          (14,014)         (115,896)        (213,144)                           (329,040)
Stock options exercised and
  related tax benefits                                9,201           154,321                                              154,321
Net income for the period        $   2,112,909                                       2,112,909                           2,112,909
Other comprehensive income,
  net of tax:
  Unrealized holding losses
    on securities available-
    for-sale arising during
    the year, net of taxes
    of $ (37,655)                      (53,842)
                                 -------------
Other comprehensive income,
  net of taxes                         (53,842)                                                           (53,842)         (53,842)
                                 -------------    ---------      ------------     ------------     --------------      -----------

Total comprehensive income       $   2,059,067
                                 =============

BALANCE AT
 SEPTEMBER 30, 2002                               1,394,433      $ 12,839,336     $  5,594,567     $      107,556     $ 18,541,459
                                                  ---------      ------------     ------------     --------------     ------------
</TABLE>


                                     Page 6
<PAGE>





                      SONOMA VALLEY BANCORP AND SUBSIDIARY
                CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

              For the nine months ended September 30, 2002 and 2001
<TABLE>
<S>                                                                                 <C>             <C>

                                                                                         2002          2001
                                                                                    -----------     -----------
OPERATING ACTIVITIES

    Net income                                                                      $ 2,112,909     $ 1,905,616
    Adjustments to reconcile net income to net cash provided by operating
activities:
      Provision for loan losses                                                         205,000         227,000
      Depreciation                                                                      108,717         106,472
      Amortization and other                                                             31,779          56,835
      Net change in interest receivable                                                  56,516          32,445
      Net change in other assets                                                         (5,228)         10,351
      Net change in cash surrender value of life insurance                             (198,711)        (87,932)
      Net change in interest payable and other liabilities                               51,306         118,048
                                                                                    -----------     -----------
                                      NET CASH PROVIDED BY OPERATING ACTIVITIES       2,362,288       2,368,835
INVESTING ACTIVITIES Securities held-to-maturity:
      Investment purchases                                                                    0        (304,409)
      Proceeds from maturing investments                                                860,000         747,700
    Securities available-for-sale:
      Investment purchases                                                             (551,947)        (12,100)
      Proceeds from maturing investments                                              7,000,000       6,050,000
   Net change in loans                                                              (12,609,009)    (13,008,100)
   Purchases of life insurance                                                       (2,000,000)
   Purchases of premises and equipment                                                 (288,026)       (125,113)
                                                                                    -----------     -----------
                                         NET CASH USED FOR INVESTING ACTIVITIES      (7,588,982)     (6,652,022)
FINANCING ACTIVITIES
   Net change in demand, interest-bearing transaction and savings deposits            7,044,877       5,260,319
   Net change in time deposits                                                        7,823,044       2,181,309
   Exercise of stock options                                                            154,321         258,738
   Stock repurchases                                                                   (329,040)       (463,237)
   Fractional shares purchased                                                          (13,951)        (11,955)
                                                                                    -----------     -----------
                                NET CASH (USED)PROVIDED BY FINANCING ACTIVITIES      14,679,251       7,225,174
                                                                                    -----------     -----------
                                        NET CHANGE IN CASH AND CASH EQUIVALENTS       9,452,557       2,941,987
   Cash and cash equivalents at beginning of period                                  20,400,662      10,182,394
                                                                                    -----------     -----------
                                     CASH AND CASH EQUIVALENTS AT END OF PERIOD     $29,853,219     $13,124,381
                                                                                    ===========     ===========
SUPPLEMENTAL DISCLOSURES:
Cash paid during the period for:
   Interest                                                                         $ 1,440,953     $ 2,436,463
   Income taxes                                                                         860,000       1,056,000
Stock dividend                                                                        1,788,977       1,381,975
Change in unrealized gains and losses
 on securities available-for-sale                                                       (91,497)        233,736
Change in deferred income taxes on
  unrealized holding gains & losses on securities                                        37,655         (96,193)
</TABLE>
                                     PAGE 7
<PAGE>



                              SONOMA VALLEY BANCORP
                     AVERAGE BALANCES/YIELDS AND RATES PAID
              For the nine months ended September 30, 2002 and 2001
                             (dollars in thousands)
<TABLE>
<S>                                                 <C>          <C>          <C>         <C>          <C>          <C>

                                                            2002                                  2001
                                                            ----                                  ----
                                                    Average      Income/      Yield/      Average      Income/      Yield/
ASSETS                                              Balance      Expense      Rate        Balance      Expense      Rate

Interest-earning assets:
Loans(2):
  Commercial                                          73,959      4,406        7.96%        59,762      4,146        9.28%
  Consumer                                            13,178        817        8.29%        14,701      1,059        9.63%
  Real estate construction                            18,296      1,265        9.24%        12,193        947       10.38%
  Real estate mortgage                                 5,856        368        8.40%         9,199        637        9.26%
  Tax exempt loans (1)                                 3,420        217        8.48%         2,361        151        8.55%
  Leases                                                 178         20       15.02%           468         35       10.00%
  Tax exempt leases (1)                                  113         11       13.02%           171         11        8.60%
  Unearned loan fees                                    (426)                                 (354)
                                                    --------     ------                   --------
         Total loans                                 114,574      7,104        8.29%        98,501      6,986        9.48%
Investment securities
  Available for sale:
         Taxable                                       7,016        322        6.14%        17,911        819        6.11%
         Tax exempt(1)                                     0          0        0.00%             0          0        0.00%
  Hold to maturity:
         Taxable                                         202          9        5.96%           203         10        6.59%
         Tax exempt (1)                               11,105        589        7.09%        11,897        633        7.11%
                                                    --------     ------                   --------     ------
         Total investment securities                  18,323        920        6.71%        30,011      1,462        6.51%
Federal funds sold                                    10,444        131        1.68%         6,678        219        4.38%
Total due from banks/Interest bearing                     85          1        1.57%            13          0        0.00%
                                                    --------     ------                   --------     ------
  Total interest earning assets                      143,426      8,156        7.60%       135,203      8,667        8.57%
                                                                              =====                    ======
Noninterest-bearing assets:
  Reserve for loan losses                             (2,509)                               (2,231)
  Cash and due from banks                              7,307                                 6,476
  Premises and equipment                                 652                                   619
  Other assets                                         9,857                                 5,234
                                                    --------                              --------
                                   Total assets     $158,733                              $145,301
                                                    ========                              ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest bearing liabilities:
  Interest bearing deposits
         Interest bearing transaction                 23,217         66        0.38%        21,968        120        0.73%
         Savings deposits                             46,748        497        1.42%        41,032        788        2.57%
         Time deposits over $100,000                  18,690        472        3.38%        16,204        643        5.31%
         Other time deposits                          17,907        404        3.02%        19,089        707        4.95%
                                                    --------     ------                   --------     ------
           Total interest bearing Deposits           106,562      1,439        1.81%        98,293      2,258        3.07%
  Federal Funds purchased                                  0          0        0.00%             0          0        0.00%
  Other short term borrowings                              0          0        0.00%           232          7        4.03%
                                                    --------     ------                   --------     ------
           Total interest bearing liabilities        106,562     $1,439        1.81%        98,525     $2,265        3.07%
                                                                 ======                                ======
Non interest bearing liabilities:
  Non interest bearing demand deposits                31,604                                29,044
  Other liabilities                                    2,935                                 2,903
                           Shareholders' equity       17,632                                14,829
                                                    --------                              --------
     Total liabilities and shareholders' equity     $158,733                              $145,301
                                                    ========                              ========
Interest rate spread                                                           5.79%                                 5.50%
                                                                               ====                                 =====
Interest income                                                  $8,156        7.60%                   $8,667        8.57%
Interest expense                                                  1,439        1.34%                    2,265        2.24%
                                                                 ------       -----                    ------       -----
Net interest income/margin                                       $6,717        6.26%                   $6,402        6.33%
                                                                 ======       =====                    ======       =====
</TABLE>


(1) Fully tax equivalent  adjustments  are based on a federal income tax rate of
    34% in 2002 and 2001.
(2) Non accrual  loans have been included in loans for the purposes of the above
    presentation.  Loan fees of  approximately  $267,023  and  $232,655 for  the
    nine months ended September  30, 2002 and September 30, 2001,  respectively,
    were amortized to the appropriate interest income categories.

                                     Page 8
<PAGE>





                      SONOMA VALLEY BANCORP AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 2002
                                   (Unaudited)

Note 1 - Basis of Presentation

In the opinion of  Management,  the  unaudited  interim  consolidated  financial
statements  contain all  adjustments  of a normal  recurring  nature,  which are
necessary to present fairly the financial condition of Sonoma Valley Bancorp and
Subsidiary  at September  30, 2002 and results of  operations  for the three and
nine months then ended.

Certain information and footnote  disclosures  presented in the Company's annual
financial  statements  are not included in these interim  financial  statements.
Accordingly,   the  accompanying   unaudited  interim   consolidated   financial
statements  should  be read  in  conjunction  with  the  consolidated  financial
statements  and notes thereto  included in the  Company's  2001 Annual Report on
Form 10- KSB.  The results of  operations  for the three and nine  months  ended
September  30, 2002 are not  necessarily  indicative  of the  operating  results
through December 31, 2002.

Note 2 - Consolidation

The  consolidated  financial  statements  include the accounts of Sonoma  Valley
Bancorp  and its wholly  owned  subsidiary  Sonoma  Valley  Bank.  All  material
intercompany accounts and transactions have been eliminated in consolidation.

Note 3 - Commitments

The Company has no  outstanding  performance  letters of credit at September 30,
2002 and September 30, 2001.

Note 4 - Net Income Per Common Share

Net income per share is calculated by using the weighted  average  common shares
outstanding.  The weighted average number of common shares used in computing the
net  income  per  common  share for the period  ending  September  30,  2002 was
1,394,947 and for the period ending September 30, 2001 was 1,405,209.

Net income per share  (diluted)  is  calculated  by using the  weighted  average
common  shares  (diluted)  outstanding.  The weighted  average  number of common
shares (diluted) used in computing the net income per common share (diluted) for
the period  ending  September  30, 2002 was  1,515,800 and for the period ending
September 30, 2001 was 1,491,164.

Prior year shares have been  adjusted to reflect the 5% stock  dividend  paid on
July 16, 2002.

                                     Page 9
<PAGE>



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

      For the Nine Month Periods
      Ended September 30, 2002 and 2001

Forward Looking Statements

With the exception of historical facts stated herein,  the matters  discussed in
this Form  10-QSB  are  "forward  looking"  statements  that  involve  risks and
uncertainties  that  could  cause  actual  results  to  differ  materially  from
projected  results.  Such  "forward  looking"  statements  include,  but are not
necessarily  limited  to  statements  regarding  anticipated  levels  of  future
revenues and earnings from the operation of Sonoma Valley Bancorp's wholly owned
subsidiary, Sonoma Valley Bank (the"Bank"), projected costs and expenses related
to operations of the bank's liquidity,  capital resources,  and the availability
of future equity capital on commercially  reasonable  terms.  Factors that could
cause  actual  results to differ  materially  include,  in addition to the other
factors  identified  in Sonoma Valley  Bancorp's  Form 10-KSB for the year ended
December 31, 2001, the following;  (i) increased  competition  from other banks,
savings and loan associations, thrift and loan associations,  finance companies,
credit unions, offerors of money market funds, and other financial institutions;
(ii) the risks and  uncertainties  relating to general  economic  and  political
conditions,  both domestically and internationally,  including,  but not limited
to, inflation,  or natural  disasters  affecting the primary service area of the
Bank or its  major  industries;  or (iii)  changes  in the laws and  regulations
governing the Bank's activities at either the state or federal level. Readers of
this Form 10-QSB are  cautioned not to put undue  reliance on "forward  looking"
statements  which,  by their  nature,  are  uncertain as reliable  indicators of
future  performance.  Sonoma Valley Bancorp disclaims any obligation to publicly
update  these  "forward  looking"  statements,   whether  as  a  result  of  new
information, future events, or otherwise.

Overview

Sonoma Valley Bancorp (the "Company")  reported net income of $2,112,909 for the
first nine months of 2002 compared with  $1,905,616 for the first nine months of
2001. On a per share basis,  net income  equaled  $1.51  compared with $1.36 per
share during the same period in 2001.

Return on average total assets on an annualized basis for the nine-month periods
was 1.78% and 1.75% respectively.  Return on average  shareholders' equity on an
annualized basis for the same periods was 16.02% and 17.36%, respectively.

RESULTS OF OPERATIONS

Net interest Income

Net interest  income is the difference  between total interest  income and total
interest expense.  Net interest income,  adjusted to a fully taxable  equivalent
basis, as shown on the table- Average Balance, Yields and Rates Paid, on page 8,
is higher than net interest income on the statement of

                                     Page 10
<PAGE>





income  because it reflects  adjustments  applicable to  tax-exempt  income from
certain  securities and loans ($278,000 in 2002 and $270,000 in 2001, based on a
34% federal income tax rate).

The  improvement in net interest  income  (stated on a fully taxable  equivalent
basis) is a result of a $511,000  decline in  interest  income and a decrease in
interest expense of $826,000.

Net interest income (stated on a fully taxable  equivalent basis) expressed as a
percentage of average earning assets, is referred to as net interest margin. The
Company's  net  interest  margin for 2002  decreased to 6.26% from 6.33% for the
same period in 2001. This variance is the continuing  effect of a decline of the
475 basis points in the prime lending rate when compared to the 350 basis points
decline at September 30, 2001.


Interest Income

As previously  stated,  interest  income  (stated on a fully taxable  equivalent
basis) decreased by $511,000 to $8.2 million in the nine months of 2002, a 5.90%
decrease  over the $8.7  million  realized  during the same period in 2001.  The
increase in volume of average balance was responsible for a $746,000 increase in
interest  income  offset by a  $1,257,000  decrease  in income  related to lower
interest rates. The net effect was a decline in interest income of $511,000.

Interest Expense

Total interest expense  decreased by $826,000 to $1.4 million.  The average rate
paid on all interest-bearing  liabilities  decreased from 3.07% in 2001 to 1.81%
in 2002.  Average  balances  increased from $98.5 million to $106.6  million,  a
8.16%  gain in  deposits.  The  increase  in  volume  of  average  balances  was
responsible  for a $165,000  increase in interest  expense  offset by a $991,000
decrease in expense  related to lower interest rates resulting in lower interest
expense of $826,000.

Individual  components of interest  income and interest  expense are provided in
the table-Average Balances, Yields and Rates Paid on page 8.

Provision for Loan Losses

The  provision  for loan losses  charged to operations is based on the Company's
monthly  evaluation of the loan  portfolio and the adequacy of the allowance for
loan  losses in  relation  to total  loans  outstanding.  The  provision  to the
allowance  for loan losses  amounted to $205,000  during the nine months of 2002
and $227,000 in the same period in 2001. The decrease in the provision is due to
management's evaluation and assessment of the loan portfolio.

Loans  charged-off  were $21,000 and recoveries were $14,000 for the nine months
of 2002 compared with $56,000 in  charge-offs  and $26,000 in recoveries for the
same period in 2001.


                                     Page 11
<PAGE>





Non-interest Income

Non-interest  income of $1.2 million  increased 21.5% over the $958,000 recorded
in the  comparable  period in 2001.  Services  Charges  were up due to customers
carrying lower balances and deposit growth,  credit card merchant fees increased
with shift to a new vendor and earnings on life  insurance  increased due to the
purchase of an additional life insurance policy.

Non-interest Expense

Total  non-interest  expense  increased  6.52% to $4.2  million  during the nine
months of 2002  from  $4.0  million  for the same  period in 2001.  Non-interest
expense on an annualized basis represented 3.55% of average total assets in 2002
compared with 3.64% in the comparable period in 2001.

Salaries and benefits  increased 8.46% from $2.4 million in 2001 to $2.6 million
in 2002. The 2002 increase  reflects higher salaries due to market pressures and
merit  increases.  At  September  30,  2002 and 2001 total full time  equivalent
employees were 37.

Expense  related to premises and equipment  increased  3.17% to $456,000 in 2002
from  $442,000  in 2001.  The  Company  continues  to  emphasize  investment  in
technology in order to better utilize  employees'  time and offer a higher level
of customer service.

Other operating expenses declined by 3.82% to $1,195,000 in 2002 from $1,152,000
in 2001. The largest category of other non-interest expense,  professional fees,
is primarily comprised of data processing,  item processing and ATM services, as
well as accounting, legal and other professional fees.

Provision for Income Taxes

The provision  for income taxes  declined to an effective tax rate of 33.63% for
the nine months of 2002 compared with 34.44% for the nine months of 2001. Income
taxes reported in the financial statements include deferred taxes resulting from
timing  differences in the recognition of items for tax and financial  reporting
purposes.

BALANCE SHEET ANALYSIS

Investments

Investment securities were $15.3 million at September 30, 2002, an 32.7% decline
from the $22.7  million at  December  31,  2001 and a 43.8%  decline  from $27.2
million at September 30, 2001. The decline in investment  securities has allowed
the Company to fund loan opportunities which has allowed the Company to maintain
a higher net interest margin. The Company purchases securities rated A or higher
by Standard and Poor's and or Moody's Investors Service.

                                     Page 12
<PAGE>





In the event a security is  downgraded,  the Company will monitor the investment
more closely or sell if appropriate.  Local  tax-exempt  bonds are  occasionally
purchased without an A rating.

Securities  are  classified  as held to  maturity,  if the  Company has both the
intent and the ability to hold these securities to maturity. As of September 30,
2002, the Company had  securities  totaling $10.9 million with a market value of
$11.6 million  categorized as held to maturity.  Decisions to acquire  municipal
securities,  which  are  generally  placed  in this  category,  are based on tax
planning needs, pledge requirements and earnings.

Securities are  classified as available for sale if the Company  intends to hold
these debt  securities for an indefinite  period of time, but not necessarily to
maturity.  Investment securities which are categorized as available for sale are
acquired as part of the overall  asset and  liability  management  function  and
serve as a primary  source of  liquidity.  Decisions  to  acquire  or dispose of
different  investments  are  based on an  assessment  of  various  economic  and
financial factors,  including, but not limited to, interest rate risk, liquidity
and capital  adequacy.  Securities  held in the  available for sale category are
recorded at market value, which is $4.4 million compared to an amortized cost of
$3.9 million as of September 30, 2002.

Although the quoted market values fluctuate, investment securities are generally
held to maturity, and accordingly,  gains and losses to the income statement are
recognized upon sale, or at such time as management  determines that a permanent
decline in value exists.

Loans

The Company's  loan portfolio was $120.1 million at September 30, 2002, or 78.7%
of  total  deposits.  This  compares  with  $107.4  million,  or  78.1% of total
deposits,  at December 31, 2001 and $105.6 million,  or 80.9% of total deposits,
at  September  30,  2001. A  comparative  schedule of average  loan  balances is
presented in the table on page 8; period end and year-end balances are presented
in the following table.
<TABLE>
<S>                          <C>               <C>           <C>             <C>           <C>              <C>


                             September 30,     Percentage    December 31,    Percentage    September 30,    Percentage
                                  2002          of Total         2001         of Total          2001         of Total
                                  ----          --------         ----         --------          ----         --------

Commercial                   $ 81,484,879        67.6%       $ 72,239,607      66.9%       $ 69,319,468       65.4%
Consumer                       13,269,622        11.0%         14,246,442      13.2%         13,948,190       13.2%
Real estate construction       20,550,668        17.1%         13,864,265      12.9%         13,076,822       12.3%
Real estate mortgage            4,959,109         4.1%          7,237,000       6.7%          9,265,258        8.7%
Leases                            226,216         0.2%            340,714       0.3%            396,245        0.4%
                             ------------                    ------------                  ------------
                              120,490,494       100.0%        107,928,028     100.0%        106,005,983      100.0%
Deferred loan fees
 and costs, net                  (440,307)                       (480,264)                     (444,116)
Allowance for loan
 and lease losses              (2,613,969)                     (2,415,555)                   (2,316,762)
                             ------------                    ------------                  ------------

                             $117,436,218                    $105,032,209                  $103,245,105
                             ============                    ============                  ============
</TABLE>


                                     Page 13
<PAGE>





Risk Elements

The majority of the Company's  loan activity is with  customers  located  within
Sonoma  County.  Approximately  82.7% of the total loan  portfolio is secured by
real estate located in the Company's service area.

Significant  concentrations  of  credit  risk  may  exist  if a  number  of loan
customers  are  engaged  in  similar   activities  and  have  similar   economic
characteristics.  The  Company  believes  it has  policies  in place to identify
problem loans and to monitor concentrations of credits.

Based  on its  risk  management  review  and a  review  of its  loan  portfolio,
management  believes  that its  allowance  for  losses  for the  quarter  ending
September  30,  2002,  is  sufficient  to  absorb  losses  inherent  in the loan
portfolio. This assessment is based upon the best available information and does
involve  uncertainty and matters of judgment.  Accordingly,  the adequacy of the
loan loss reserve  cannot be determined  with precision and could be susceptible
to significant change in future periods.

Non Performing Assets

Management  classifies all loans as non accrual loans when they become more than
90 days past due as to principal or interest,  or when the timely  collection of
interest or principal becomes uncertain,  if earlier, unless they are adequately
secured and in the process of collection.

A loan remains in a non accrual  status until both  principal  and interest have
been  current for 6 months and when other  criteria  are met or when the loan is
determined to be uncollectible and is charged off against the allowance for loan
losses,  or, in the case of real  estate  loans,  is  transferred  to other real
estate owned. A loan is classified as a restructured loan when the interest rate
is materially  reduced,  when the term is extended beyond the original  maturity
date or other  concessions  are made by the bank because of the inability of the
borrower to repay the loan under the original terms.

There were  $402,000 of non accrual  loans and no loans 90 days or more past due
and still  accruing at September  30, 2002.  There were  $347,000 of non accrual
loans and no loans 90 days or more past due and still  accruing at September 30,
2001.

Allowance for Loan Losses

The allowance for loan losses is  maintained at a level  considered  adequate to
provide  for  losses  that  can be  reasonably  anticipated.  The  allowance  is
increased by provisions charged to operating expense and reduced by charge-offs,
net of recoveries.  The allowance is based on estimates, and ultimate losses may
vary from the current  estimates.  These estimates are reviewed  monthly and, as
adjustments  become  necessary,  they are reported in earnings in the periods in
which they become known.

The  review   process  is  intended  to  identify  loan  customers  who  may  be
experiencing financial difficulties. In these circumstances,  a specific reserve
allocation  or  charge-off  may be  recommended.  Other  factors  considered  by
management in evaluating the adequacy of the

                                     Page 14
<PAGE>





allowance  include:  loan  volume,  historical  net loan  loss  experience,  the
condition  of  industries  and  geographic  areas  experiencing  or  expected to
experience  economic  adversities,   credit  evaluations  and  current  economic
conditions.  The allowance for loan losses is not a precise amount, but based on
the factors above,  represents  management's best estimate of losses that may be
ultimately realized from the current loan portfolio.

Worsening  conditions in certain  economic  sectors and  geographic  areas could
adversely affect the loan portfolio,  necessitating  larger  provisions for loan
losses than currently  estimated.  However, as of September 30, 2002 the Company
believes its overall allowance for loan losses is adequate based on its analysis
of conditions at that time.

At September 30, 2002, the allowance for loan losses was $2.6 million,  or 2.18%
of period-end loans,  compared with $2.4 million,  or 2.25% at December 31, 2001
and $2.3 million, or 2.19% at September 30, 2001.

An  analysis  of the  changes  in  the  allowance  for  loan  losses,  including
charge-offs and recoveries by loan categories, is presented below.
<TABLE>
<S>                                          <C>              <C>              <C>


                                             For the Nine     For the Year     For the Nine
                                             Months Ended         Ended        Months Ended
                                               9/30/02          12/31/01         9/30/01

Balance beginning of year                    $  2,415,555     $  2,120,517     $  2,120,517
Charge-offs:
  Commercial                                      (10,741)         (44,345)         (44,345)
  Consumer                                        (10,070)         (31,680)         (12,013)
                                             ------------     ------------     ------------

                      Total charge-offs           (20,811)         (76,025)         (56,358)

Recoveries:

  Commercial                                        6,914           10,363            7,958
  Consumer                                          7,311           18,700           17,645
                                             ------------     ------------     ------------

                       Total recoveries            14,225           29,063           25,603

Net (chargeoffs) recoveries                        (6,586)         (46,962)         (30,755)
Provision charged to operations                   205,000          342,000          227,000
                                             ------------     ------------     ------------
Balance end of period                        $  2,613,969     $  2,415,555     $  2,315,762
                                             ============     ============     ============
Ratio of net charge-offs
 annualized to average loans                         0.01%            0.05%            0.04%
Balance in allowance as a percentage                 2.18%            2.25%            2.19%
  of loans outstanding at period end
</TABLE>



                                     Page 15
<PAGE>





Deposits

A comparative  schedule of average deposit balances is presented in the table on
page 8; period end and year-end  deposit balances are presented in the following
table.
<TABLE>
<S>                       <C>              <C>            <C>            <C>            <C>               <C>


                          September 30,    Percentage     December 31,   Percentage     September 30,     Percentage
                             2002           of Total        2001          of Total         2001           of Total
                             ----           --------        ----          --------         ----           --------

Interest bearing

 transaction deposits     $24,199,502           15.9%     $ 23,865,954        17.3%     $ 21,501,813          16.5%

Savings deposits           50,626,679           33.2%       45,523,306        33.1%       43,180,278          33.1%

Time deposits,
$100,000
 and over                   23,967,400          15.7%       17,809,990        12.9%       18,425,622          14.1%
Other time deposits         19,824,973          13.0%       18,159,339        13.2%       18,858,432          14.4%
                          ------------          -----     ------------       -----      ------------         -----
Total interest bearing
 deposits                  118,618,554          77.8%      105,358,589        76.5%      101,966,145          78.1%
Demand deposits             33,904,346          22.2%       32,296,390        23.5%       28,571,555          21.9%
                          ------------          -----     ------------       -----      ------------         -----
Total deposits            $152,522,900         100.0%     $137,654,979       100.0%     $130,537,700         100.0%
                          ============         =====      ============       =====      ============         =====
</TABLE>


Total deposits  increased by $14.9  million,  during the nine months of 2002, to
$152.5  million from $137.7 million at December 31, 2001.  Savings  deposits and
time deposits over $100,000 showed the largest increase of $5.1 million and $6.2
million respectively,  over year end balances. Other time deposits, non-interest
bearing demand deposits and interest-bearing transaction accounts also increased
$1.7 million, $1.6 million and $334,000, respectively.

Risk-Based Capital

The Federal Deposit Insurance  Corporation (FDIC) has adopted risk-based capital
guidelines  which establish a risk-adjusted  ratio relating capital to different
categories of assets and off- balance sheet exposures. Under current guidelines,
as of September 30, 2002, the Bank was required to have minimum Tier I and total
risk-based  capital  ratios of 4% and 8%  respectively.  To be well  capitalized
under Prompt  Corrective  Action  Provisions  requires  minimum Tier I and total
risk-based capital ratios should be 6% and 10% respectively.

The FDIC has also adopted new minimum  leverage ratio  guidelines for compliance
by banking organizations.  The guidelines require a minimum leverage ratio of 4%
of Tier 1 capital to total average assets.  Banks experiencing high growth rates
are expected to maintain  capital  positions well above the minimum levels.  The
leverage ratio in conjunction  with the risk-based  capital ratio constitute the
basis for determining the capital adequacy of banking organizations.



                                     Page 16
<PAGE>





The table below presents Tier 1 capital,  total capital and total  risk-weighted
assets at September 30, 2002,  along with the related  risk-based  capital ratio
and leverage ratio.

(dollars in thousands)

     Total
  Risked-based     TIER 1                TOTAL               Leverage
     Assets       Capital     Ratio     Capital     Ratio     Ratio

  $149,590        $18,231     12.19%    $20,110     13.44%    10.98%

Asset/Liability Management

The  principal  objectives  of  asset/liability  management  are to  manage  the
sensitivity  of net  interest  rate  spreads to changes in  interest  rates.  In
addition, management attempts to balance risk with profitability.  Interest rate
sensitivity  measures the  differences in the timing at which certain assets and
liabilities are repriced.

The following table sets forth the dollar amounts of maturing  and/or  repricing
assets and  liabilities for various  periods.  Prepayments and runoff can impact
the  scheduled   repricing.   However,   because  they  have  historically  been
immaterial, estimates for them are not included.

The Company has more  liabilities  than assets  repricing  during the next year.
However,  because the Company's asset rates change more than deposit rates,  the
Company's interest income will change more than cost of funds when rates change.
Its net interest margin should therefore  increase  somewhat when rates increase
and shrink somewhat when rates fall. The current estimate is a $326,000 increase
in income for a 1%  increase  in the Fed Funds  rate and a  $273,000  decline in
income for a 1% decline in the fed funds rate.  This exposure to declining rates
is currently  exaggerated by an assumption that with lower interest,  fixed rate
loans will refinance and current deposit rates are static.

                                     Page 17
<PAGE>





The Company controls its long term interest rate risk by keeping long term fixed
rate assets  (longer  than 5 years) less than its long term fixed rate  funding,
primarily  demand deposit  accounts and capital.  The following table sets forth
cumulative  maturity  distributions  as of September  30, 2002 for the Company's
interest-bearing  assets and  interest-bearing  liabilities,  and the  Company's
interest rate sensitivity gap as a percentage of total interest-earning assets.
<TABLE>
<S>                                   <C>          <C>           <C>         <C>         <C>          <C>           <C>


SEPTEMBER 30, 2002                    3 months     12 months     3 years     5 years     15 years     >15 years      Totals
                                      --------     ---------     --------    --------    --------     ---------     --------
(in thousands)

ASSETS:
  Fixed rate investments              $    730     $   2,325     $  6,367    $    455    $  3,955     $   1,190     $ 15,022
  Variable rate investments                  0             0            0           0           0           279          279
  Fixed rate loans                       7,037        14,475        7,228      14,036      39,911         2,782       85,469
  Variable rate loans                   33,568           199           13         840           0             0       34,620
  Interest-bearing balances due
  from banks                                35                                                                            35

  Fed funds sold                        22,235                                                                        22,235
                                      --------     ---------     --------    --------    --------     ---------     --------
     Interest bearing assets            63,605        16,999       13,608      15,331      43,866         4,251      157,660
                                      --------     ---------     --------    --------    --------     ---------     --------

LIABILITIES:
  Interest bearing transaction
  deposits                              24,200                                                                        24,200
  Savings deposits                      50,627                                                                        50,627
Time Deposits                                                                                                              0
     Fixed rate >100m                    5,917         9,668        7,291       1,219                                 24,095
     Fixed rate <100m                    5,367         8,125        5,418         737                                 19,647
     Floating rate >100m                                                                                                   0
     Floating rate <100m                    50                                                                            50
  Borrowings                                 0                                                                             0
                                      --------     ---------     --------    --------    --------     ---------     --------
  Interest Bearing Liabilities       $  86,161     $  17,793     $ 12,709    $  1,956           0             0     $118,619
                                     ---------     ---------     --------    --------    --------     ---------     --------

Rate Sensitivity Gap                   (22,556)         (794)         899      13,375      43,866         4,251
                                      --------     ---------     --------    --------    --------     ---------
Cumulative Rate Sensitivity Gap        (22,556)      (23,350)     (22,451)     (9,076)     34,790        39,041
                                      --------     ---------     --------    --------    --------     ---------

Cumulative Position to Total Assets     -12.95%       -13.41%      -12.89%      -5.21%      19.98%        22.42%
                                      --------     ---------     --------    --------    --------     ---------
</TABLE>

For the Three Month Periods
Ended September 30, 2002 and 2001

Overview

The  Company  reported  net  income of  $687,000  for the third  quarter of 2002
compared with $661,000 for the third quarter of 2001. On a per share basis,  net
income for the three  months  ended  September  30, 2002  equaled $.49 per share
compared with $.47 per share during the same period in 2001.

Return on average total assets on an annualized basis for the three months ended
September 30, 2002 and 2001 was 1.65% and 1.76%, respectively. Return on average
shareholders' equity on an annualized basis for the three months ended September
30, 2002 and 2001 was 15.0% and 17.3%, respectively.



                                     Page 18
<PAGE>





RESULTS OF OPERATIONS

Net Interest Income

Net interest  income,  adjusted to a fully taxable  equivalent  basis,  remained
constant at $2.1 million for the three months ended  September 30, 2002, and the
comparable  period of 2001.  Net interest  income on a fully taxable  equivalent
basis,  as shown on the table -Average  Balances,  Yields and Rates Paid on page
21, is higher than net interest  income on the  statements of income  because it
reflects adjustments applicable to tax-exempt income from certain securities and
loans  ($90,000 in 2002 and $90,000 in 2001,  based on a 34% federal  income tax
rate).

Net interest income (stated on a fully taxable  equivalent basis) expressed as a
percentage of average earning assets, is referred to as net interest margin. The
Company's  net interest  margin for the third  quarter of 2002 declined to 5.93%
from 6.36% for the comparable  period in 2001.  This variance is the result of a
decline of 125 basis points in the prime lending rate when compared to September
30, 2001.

Interest Income

Interest  income for the three  months  ended  September  30, 2002  decreased by
$183,000 to $2.75  million,  a 6.23%  decline  over the $2.93  million  realized
during  the same  period in 2001.  The gain in volume of  average  balances  was
responsible  for a $249,000  increase  in interest  income  offset by a $432,000
decrease in income related to lower interest rates. The net effect was a decline
in interest income of $183,000.

Interest Expense

Total interest expense for the three months ended September 30, 2002 declined by
$184,000  to $502,000  compared  with  $686,000 in the same period of 2001.  The
average rate paid on all  interest-bearing  liabilities for the third quarter of
2002  declined  to 1.79% from 2.69% in the third  quarter of 2001,  and  average
balances for the third quarter of 2002  increased to $111.1  million from $101.3
million in the same period of 2001, a 9.67% gain.

The gain in volume of  average  balances  accounted  for a $71,000  increase  in
interest  expense offset by a $255,000  decline  related to lower interest rates
paid resulting in a $184,000  decrease in interest expense for the third quarter
of 2002.

Individual  components of interest  income and interest  expense are provided in
the table - Average Balances, Yields and Rates Paid on page 21.

Provision for Loan Losses

The  provision  for loan  losses  during the third  quarter of 2002 was  $70,000
compared to $80,000 for the third quarter of 2001. The decrease in the provision
is the result of managements' evaluation and assessment of the loan portfolio.


                                     Page 19
<PAGE>





Non-interest Income

Non-interest  income of $383,000 for the third  quarter of 2002  represented  an
increase of $49,000,  or 14.5%,  from the $335,000 for the comparable  period in
2001.

Non-interest Expense

For the third quarter of 2002,  non-interest  expense was $1.4 million  compared
with $1.4  million  for the same  period in 2001,  representing  an  increase of
$43,000,  or 3.09%.  Salaries and benefits  decreased $6,000, or .66%,  compared
with the three months ended September 30, 2001.

Premises and equipment expense increased $15,000, or 10.55%, to $157,000 for the
third quarter of 2002 from $142,000 for the third quarter of 2001.

Other operating expenses for the three months ended September 30, 2002 increased
9.26% to $401,000 from $367,000 in the same period in 2001.

Provision for Income Taxes

The  provision  for income taxes  declined to an effective tax rate of 33.54% in
the third  quarter of 2002  compared  with 35.01% for the  comparable  period in
2001. Income taxes reported in the financial  statements  include deferred taxes
resulting  from  timing  differences  in the  recognition  of items  for tax and
financial reporting purposes.


                                     Page 20
<PAGE>





                              SONOMA VALLEY BANCORP
                     AVERAGE BALANCES/YIELDS AND RATES PAID
             For the three months ended September 30, 2002 and 2001
                             (dollars in thousands)
<TABLE>
<S>                                                    <C>         <C>         <C>        <C>         <C>         <C>

                                                             2002                               2001
                                                              ----                               ----
                                                       Average     Income/     Yield/     Average     Income/     Yield/
ASSETS                                                 Balance     Expense     Rate       Balance     Expense     Rate

Interest-earning assets:
Loans(2):
  Commercial                                             77,252     1,539       7.90%       64,889     1,448       8.85%
  Consumer                                               12,986       269       8.22%       14,180       363      10.16%
  Real estate construction                               19,667       420       8.47%       11,591       308      10.54%
  Real estate mortgage                                    5,067       108       8.46%        9,099       207       9.03%
  Tax exempt loans (1)                                    3,359        71       8.39%        2,424        53       8.67%
  Leases                                                    149         6      15.98%          259         7      10.72%
  Tax exempt leases (1)                                      96         4      16.53%          156         4      10.17%
  Unearned loan fees                                       (418)                              (430)
                                                       --------    ------                 --------
         Total loans                                    118,158     2,417       8.12%      102,168     2,390       9.28%
Investment securities
  Available for sale:
         Taxable                                          4,610        68       5.85%       16,276       247       6.02%
         Tax exempt(1)                                        0         0       0.00%            0         0       0.00%
  Hold to maturity:
         Taxable                                            201         3       5.92%          203         4       7.82%
         Tax exempt (1)                                  10,781       191       7.03%       11,709       207       7.01%
                                                       --------    ------                 --------    ------
         Total investment securities                     15,592       262       6.67%       28,188       458       6.45%
Federal funds sold                                       16,639        70       1.67%        9,798        84       3.40%
Total due from banks/Interest bearing                        34         0       0.00%            7         0       0.00%
                                                       --------    ------                 --------    ------
  Total interest earning assets                         150,423     2,749       7.25%      140,161     2,932       8.30%
                                                                               =====                              =====
Noninterest-bearing assets:
  Reserve for loan losses                                (2,583)                            (2,304)
  Cash and due from banks                                 7,417                              6,588
  Premises and equipment                                    739                                628
  Other assets                                           10,231                              5,026
                                                       --------                           --------
                                       Total assets    $166,227                           $150,099
                                                       ========                           ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest bearing liabilities:
  Interest bearing deposits
         Interest bearing transaction                    23,914      $ 22       0.36%       23,067        35       0.60%
         Savings deposits                                47,864       167       1.38%       41,960       229       2.17%
         Time deposits over $100,000                     20,651       176       3.38%       17,082       207       4.81%
         Other time deposits                             18,660       137       2.91%       19,187       215       4.45%
                                                       --------    ------                  -------    ------
           Total interest bearing Deposits              111,089       502       1.79%      101,296       686       2.69%
  Federal funds purchased                                     0         0       0.00%            0         0       0.00%
  Other short term borrowings                                 0         0       0.00%            0         0       0.00%
                                                       --------    ------                 --------    ------
           Total interest bearing liabilities           111,089    $  502       1.79%      101,296    $  686       2.69%
                                                                               =====                              =====
Non interest bearing liabilities:
  Non interest bearing demand deposits                   33,824                             30,508
  Other liabilities                                       3,050                              3,007
                               Shareholders' equity      18,264                             15,288
                                                       --------                           --------
         Total liabilities and shareholders' equity    $166,227                           $150,099
                                                       ========                           ========
Interest rate spread                                                            5.46%                              5.61%
                                                                               =====                              =====
Interest income                                                     2,749       7.25%                 $2,932       8.30%
Interest expense                                                      502       1.32%                    686       1.94%
                                                                   ------      -----                  ------      -----
Net interest income/margin                                         $2,247       5.93%                 $2,246       6.36%
                                                                   ======      =====                  ======      =====
</TABLE>


(1) Fully tax equivalent  adjustments  are based on a federal income tax rate of
    34% in 2002 and 2001.
(2) Non accrual loans have been included in loans for the purposes  of the above
    presentation.  Loan fees of  approximately  $76,863 and $97,734 for the nine
    months ended  September  30, 2002 and September 30, 2001, respectively, were
    amortized to the appropriate interest income categories.

                                     Page 21
<PAGE>




Item 3. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Within 90 days of the filing date of this report,  the Chief  Executive  Officer
and Chief Financial Officer of the Company evaluated the disclosure controls and
procedures of the Company and have  determined that such controls and procedures
are effective.

Changes in Internal Controls

There have been no significant  changes in the Company's internal controls or in
other factors that could  significantly  affect these controls subsequent to the
date of the evaluation referred to in the paragraph above.

                                     Part II

Item 1. LEGAL PROCEEDINGS

From time to time the Company may be a party to legal proceedings arising in the
ordinary course of business. The Company is not currently a party to, nor is any
of its properties the subject of, any material pending legal proceedings.

Item 2. CHANGES IN SECURITIES

None

Item 3. DEFAULTS UPON SENIOR SECURITIES

None

Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None

Item 5. OTHER INFORMATION

None

Item 6. EXHIBITS AND REPORTS ON FORM 8-K

        (a)      Exhibits
                 Exhibit 99.1  Sarbanes-Oxley Act of 2002 CEO
                 Exhibit 99.2  Sarbanes-Oxley Act of 2002 CFO

        (b)      Reports on Form 8-K
                 None

                                     Page 22
<PAGE>





                                   SIGNATURES

Under the  requirements of the Securities  Exchange Act of 1934, the Company has
duly caused this report to be signed on its behalf by the undersigned  thereunto
duly authorized.


                                           SONOMA VALLEY BANCORP




Date:   November 13, 2002                  /s/ Mel Switzer, Jr.
     ---------------------------           -------------------------------------
                                           Mel Switzer, Jr.
                                           President and Chief Executive Officer
                                           (Principal Executive Officer)




Date:   November 13, 2002                  /s/ Mary Quade Dieter
     ---------------------------           -------------------------------------
                                           Mary Quade Dieter
                                           Executive Vice President and
                                           Chief Operating Officer
                                           (Principal Accounting Officer)

                                     Page 23
<PAGE>






                                 CERTIFICATION

I, Mel Switzer, Jr., Chief Executive Officer for Sonoma Valley Bancorp,  certify
that:

1. I have reviewed this quarterly  report on Form 10-QSB
of Sonoma Valley Bancorp;

2. Based on my  knowledge,  this  quarterly  report  does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

  a) designed such  disclosure controls and  procedures  to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others  within those  entities,  particularly  during the
period in which this quarterly report is being prepared;

  b) evaluated the effectiveness  of the  registrant's  disclosure  controls and
procedures  as of a date  within  90  days  prior  to the  filing  date  of this
quarterly report (the "Evaluation Date"); and

  c) presented in this quarterly  report our conclusions about the effectiveness
of the disclosure controls and  procedures  based  on our  evaluation  as of the
Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):

  a) all significant  deficiencies  in  the  design  or  operation  of  internal
controls which could  adversely  affect  the  registrant's  ability  to  record,
process,  summarize  and  report  financial  data  and have  identified  for the
registrant's auditors any material weaknesses in internal controls; and

  b) any  fraud, whether or not  material,  that  involves  management  or other
employees who have a significant role in the registrant's internal controls; and

6. The  registrant's  other  certifying  officers  and I have  indicated in this
quarterly  report  whether or not there  were  significant  changes in  internal
controls or in other factors that could  significantly  affect internal controls
subsequent to the date of our most recent  evaluation,  including any corrective
actions with regard to significant deficiencies and material weaknesses.


Dated:    November 13, 2002              /s/ Mel Switzer, Jr.
       ---------------------------       ---------------------------------------
                                         Mel Switzer, Jr.
                                         Chief Executive Officer
                                         (Principal Executive Officer)

<PAGE>







                                 CERTIFICATION

I, Mary Quade Dieter,  Chief Financial  Officer for Sonoma Valley
Bancorp,  certify that:

1. I have  reviewed  this  quarterly  report on Form  10-QSB  of  Sonoma  Valley
Bancorp;

2. Based on my  knowledge,  this  quarterly  report  does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

  a) designed such  disclosure controls and  procedures  to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others  within those  entities,  particularly  during the
period in which this quarterly report is being prepared;

  b) evaluated the  effectiveness of the  registrant's  disclosure  controls and
procedures  as of a date  within  90  days  prior  to the  filing  date  of this
quarterly report (the "Evaluation Date"); and

  c) presented in this quarterly report our  conclusions about the effectiveness
of the  disclosure controls and procedures  based  on our  evaluation  as of the
Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):

  a) all significant  deficiencies  in the   design or   operation  of  internal
controls which  could  adversely  affect the  registrant's  ability  to  record,
process,  summarize   and report  financial  data and have  identified  for  the
registrant's auditors any material weaknesses in internal controls; and

 b) any  fraud,  whether  or not  material,  that  involves  management or other
employees who have a significant role in the registrant's internal controls; and

6. The  registrant's  other  certifying  officers  and I have  indicated in this
quarterly  report  whether or not there  were  significant  changes in  internal
controls or in other factors that could  significantly  affect internal controls
subsequent to the date of our most recent  evaluation,  including any corrective
actions with regard to significant deficiencies and material weaknesses.


Dated:    November 13, 2002              /s/ Mary Quade Dieter
       ---------------------------       ---------------------------------------
                                         Mary Quade Dieter
                                         Chief Financial Officer
                                         (Principal Accounting and Financial
                                          Officer)



<PAGE>

                                                                    Exhibit 99.1


                                  Certification


I, Mel Switzer, Jr., Chief Executive Officer for Sonoma Valley Bancorp,  certify
that:

1. I have reviewed the quarterly report on Form 10-QSB of Sonoma Valley Bancorp;

2. Based on my  knowledge,  this  quarterly  report  does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report; and

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this quarterly report.




Dated:     November 13, 2002                /s/ Mel Switzer, Jr.
        ---------------------------         ------------------------------------
                                            Mel Switzer, Jr.
                                            Chief Executive Officer
                                            (Principal Executive Officer)





<PAGE>



                                                                    Exhibit 99.2

                                  Certification


I, Mary Quade Dieter, Chief Financial Officer for Sonoma Valley Bancorp, certify
that:

1. I have reviewed the quarterly report on Form 10-QSB of Sonoma Valley Bancorp;

2. Based on my  knowledge,  this  quarterly  report  does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report; and

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this quarterly report.




Dated:     November 13, 2002                /s/ Mary Quade Dieter
        ---------------------------         ------------------------------------
                                            Mary Quade Dieter
                                            Chief Financial Officer
                                            (Principal Accounting and Financial
                                             Officer)