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                                   MONARCH BANCORP

                               1993 STOCK OPTION PLAN

                                Adopted March 16, 1993

                                 Amended May 23, 1995

                                 Amended May 15, 1996

1.  PURPOSE

    The purpose of the Monarch Bancorp 1993 Stock Option Plan (the "Plan") is
to strengthen Monarch Bancorp (the "Corporation") and those corporations which
are or hereafter become subsidiary corporations by providing additional means of
attracting and retaining competent managerial personnel and by providing to
participating directors, officers, and key employees added incentives for high
levels of performance and for unusual efforts to increase the earnings of the
Corporation and any Subsidiary corporations; and to allow consultants, business
associates and others with business relationships with the opportunity to
participate in the ownership of the Corporation and thereby have an interest in
the success and increased value of the Corporation.  The Plan seeks to
accomplish these purposes and achieve these results by providing a means whereby
such directors, officers, key employees, consultants, business associates and
others may purchase shares of Common Stock of the Corporation pursuant to Stock
Options granted in accordance with this Plan.


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    Stock Options granted pursuant to this Plan are intended to be Incentive
Stock Options or Non-Qualified Stock Options, as shall be determined and
designated by the Stock Option Committee upon the grant of each Stock Option
hereunder.

2.  DEFINITIONS

    For the purposes of this Plan, the following terms shall have the following
meanings:

         (a) "COMMON STOCK."  This term shall mean shares of the Corporation's
no par value common stock, subject to adjustment pursuant to Paragraph 14
(Adjustment Upon Changes in Capitalization) hereunder.

         (b) "CORPORATION."  This term shall mean Monarch Bancorp, a California
corporation.

         (c) "ELIGIBLE PARTICIPANT."  This term shall mean: (i) all directors
of the Corporation or any Subsidiary; (ii) all full-time officers (whether or
not they are also directors) of the Corporation or any Subsidiary; (iii) all
full-time key employees (as such persons may be determined by the Stock Option
Committee from time to time) of the Corporation or any Subsidiary, and (iv)
consultants, business associates or others with important business relationships
with the Corporation.

         (d) "FAIR MARKET VALUE."  This term shall mean the fair market value
of the Corporation's Common Stock as determined in accordance with the
Commissioner of Corporations Regulation Section 260.140.50, which generally
provides that in determining whether the price is fair, predominant weight will
be given to the following:  (a) if securities of the same class are publicly
traded on an active market


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of substantial depth, the recent market price of such securities; (b) if the
securities of the same class have not been so publicly traded, the price at
which securities of reasonable comparable corporations (if any) in the same
industry are being traded, subject to appropriate adjustments for the
dissimilarities between the corporations being compared; or (c) in the absence
of any reliable indicator under subsection (a) or (b), the earnings history,
book value and prospects of the issuer in light of market conditions generally.

         (e) "INCENTIVE STOCK OPTION."  This term shall mean a Stock Option
which is an "Incentive Stock Option" within the meaning of Section 422A of the
Internal Revenue Code of 1986, as amended.

         (f) "NON-QUALIFIED STOCK OPTION."  This term shall mean a Stock Option
which is not an Incentive Stock Option.

         (g) "OPTION SHARES."  This term shall mean shares of Common Stock
which are covered by and subject to any outstanding unexercised Stock Option
granted pursuant to this Plan.

         (h) "OPTIONEE."  This term shall mean any Eligible Participant to whom
a stock option has been granted pursuant to this Plan, provided that at least
part of the Stock Option is outstanding and unexercised.

         (i) "PLAN."  This term shall mean the Monarch Bancorp 1993 Stock
Option Plan as embodied herein and as may be amended from time to time in
accordance with the terms hereof and applicable law.


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         (j) "STOCK OPTION."  This term shall mean the right to purchase from
the Corporation a specified number of shares of Common Stock under the Plan at a
price and upon terms and conditions determined by the Stock Option Committee.

         (k) "STOCK OPTION COMMITTEE."  The Board of Directors of the
Corporation may select and designate a stock option committee consisting of at
least three and not more than five persons, at least two of whom are directors,
having full authority to act in the matters.  Regardless of whether a Stock
Option Committee is selected, the Board of Directors may act as the Stock Option
Committee and any action taken by the Board of Directors as such shall be deemed
to be action taken by the Stock Option Committee.  All references in the Plan to
the "Stock Option Committee" shall be deemed references to the Board of
Directors acting as a stock option committee and to a duly appointed Stock
Option Committee, if there be one.  In the event of any conflict between any
action taken by the Board of Directors acting as a Stock Option Committee and
any action taken by a duly appointed Stock Option Committee, the action taken by
the Board of Directors shall be controlling and the action taken by the duly
appointed Stock Option Committee shall be disregarded.

         (l) "SUBSIDIARY."  This term shall mean any subsidiary corporation of
the Corporation as such term is defined in Section 425(f) of the Internal
Revenue Code of 1986, as amended.

3.  ADMINISTRATION

         (a) STOCK OPTION COMMITTEE.  This Plan shall be administered by the
Stock Option Committee.  The Board of Directors of the Corporation shall have
the right, in


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its sole and absolute discretion, to remove or replace any person from or on the
Stock Option Committee at any time for any reason whatsoever.

         (b) ADMINISTRATION OF THE PLAN.  Any action of the Stock Option
Committee with respect to the administration of the Plan shall be taken pursuant
to a majority vote, or pursuant to the unanimous written consent, of its
members.   Any such action taken by the Stock Option Committee in the
administration of this Plan shall be valid and binding, so long as the same is
in conformity with the terms and conditions of this Plan.  Subject to compliance
with each of the terms, conditions and restrictions set forth in this Plan,
including, but not limited to, those set forth in Section 6(a)(ii) hereof, the
Stock Option Committee shall have the exclusive right, in its sole and absolute
discretion, to establish the terms and conditions of any Stock Options granted
under the Plan, including, without limitation, the power to: (i) establish the
number of Stock Options, if any, to be granted hereunder, in the aggregate and
with regard to any individual Eligible Participant; (ii) determine the time or
times when such Stock Options, or any parts thereof, may be exercised; (iii)
determine and designate which Stock Options granted under the Plan shall be
Incentive Stock Options and which shall be Non-Qualified Stock Options; (iv)
determine the Eligible Participants, if any, to whom Stock Options are granted;
(v) determine the duration and purposes, if any, of leaves of absence which may
be permitted to holders of unexercised, unexpired Stock Options without such
constituting a termination of employment under the Plan; (vi) prescribe and
amend the terms, provisions and form of any instrument or agreement setting
forth the terms and conditions of every Stock Option granted hereunder; and


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(vii) make loans to or guarantee any obligations of any Optionees, except
directors, in connection with the exercise of Stock Options as specified in
Section 8(d) hereof, whenever the Stock Option Committee determines that such
loan or guarantee may reasonably be expected to benefit the corporation, subject
to the provisions of Section 315(b) of the California General Corporations Law
of 1977, as amended and subject to Regulations G, U and T promulgated by the
Board of Governors of the Federal Reserve System pursuant to Section 7 of the
Securities Exchange Act of 1934, if the Option Shares are listed on a stock
exchange or are contained in the list of over-the-counter margin securities
published by the Federal Reserve Board.

         (c) DECISIONS AND DETERMINATIONS.  Subject to the express provisions
of the Plan, the Stock Option Committee shall have the authority to construe and
interpret the Plan, to define the terms used therein, to prescribe, amend, and
rescind rules and regulations relating to the administration of the Plan, and to
make all other determinations necessary or advisable for administration of the
Plan.  Determinations of the Stock Option Committee on matters referred to in
this Section 3 shall be final and conclusive so long as the same are in
conformity with the terms of this Plan.

4.  SHARES SUBJECT TO THE PLAN

    Subject to adjustments as provided in Section 14 hereof, the maximum number
of shares of Common Stock which may be issued upon exercise of Stock Options
granted under this Plan is limited to 10% of the issued and outstanding shares
of the Corporation up to a maximum of 3,437,482 shares in the aggregate,
following the acquisition of Western Bank.  If any Stock Option shall be
canceled, surrendered, or


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expire for any reason without having been exercised in full, the unpurchased
Option Shares represented thereby shall again be available for grants of Stock
Options under this Plan.

5.  ELIGIBILITY

    Only Eligible Participants shall be eligible to receive grants of Stock
Options under this Plan.

6.  GRANTS OF STOCK OPTIONS

         (a) GRANT.  Subject to the express provisions and limitations of the
Plan, the Stock Option Committee, in its sole and absolute discretion, may grant
Stock Options to Eligible Participants of the Corporation, for a number of
Option Shares, at the price(s) and time(s), on the terms and conditions and to
such Eligible Participants as it deems advisable and specifies in the respective
grants.

         Subject to the limitations and restrictions set forth in the Plan, an
Eligible Participant who has been granted a Stock Option may, if otherwise
eligible, be granted additional Stock Options if the Stock Option Committee
shall so determine.  The Stock Option Committee shall designate in each grant of
a Stock Option whether the Stock Option is an Incentive Stock Option or a
Non-Qualified Stock Option.

         (b) DATE OF GRANT AND RIGHTS OF OPTIONEE.  The determination of the
Stock Option Committee to grant a Stock Option shall not in any way constitute
or be deemed to constitute an obligation of the Corporation, or a right of the
Eligible Participant who is the proposed subject of the grant, and shall not
constitute or be deemed to constitute the grant of a Stock Option hereunder
unless and until both the


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Corporation and the Eligible Participant have executed and delivered the form of
stock option agreement then required by the Stock Option Committee as evidencing
the grant of the Stock Option, together with such other instruments as may be
required by the Stock Option Committee pursuant to this Plan; provided, however,
that the Stock Option Committee may fix the date of grant as any date on or
after the date of its final determination to grant the Stock Option (or if no
such date is fixed, then the date of grant shall be the date on which the
determination was finally made by the Stock Option Committee to grant the Stock
Option), and such date shall be set forth in the stock option agreement.  The
date of grant as so determined shall be deemed the date of grant of the Stock
Option for purposes of this Plan.

         (c) SHAREHOLDER-EMPLOYEES.   Notwithstanding anything to the contrary
contained elsewhere herein, a Stock Option shall not be granted hereunder to an
Eligible Participant who owns, directly or indirectly, at the date of the grant
of the Stock Option, more than ten percent (10%) of the total combined voting
power of all classes of capital stock of the Corporation or a Subsidiary
corporation, unless the purchase price of the Option Shares subject to said
Stock Option is at least 110% of the Fair Market Value of the Option Shares,
determined as of the date said Stock Option is granted.

         (d) MAXIMUM VALUE OF STOCK OPTIONS.  Except as provided in paragraph
(e) of this Section 6, the maximum aggregate Fair Market Value of Option Shares
(determined as of the respective Stock Option grant dates) for which an Eligible
Participant may be granted Incentive Stock Options in any calendar year shall
not


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exceed $100,000, plus any "unused carryover amount." The unused carryover
amount, determined on a yearly basis, shall be equal to one-half (1/2) of the
difference between $100,000 and the aggregate Fair Market Value (determined as
of the respective Stock Option grant dates) of all of the Option Shares subject
to Incentive Stock Options granted to the Optionee during the calendar year
under the Plan.  The provisions of Section 422A(c)(4) of the Internal Revenue
Code of 1986, as amended, are incorporated herein by this reference for the
purpose of the determination and application of the unused carryover amount.

         The aggregate fair market value (determined at the time the option is
granted) of the stock with respect to which incentive stock options are
exercisable for the first time by such individual under the terms of the Plan
during any calendar year is limited to $100,000, but the value of stock for
which options may be granted to an employee in a given year may exceed $100,000.

         (e) NON-QUALIFIED STOCK OPTIONS.  All Stock Options granted by the
Stock Option Committee which: (i) are designated at the time of grant as
Incentive Stock Options but do not so qualify under the provisions of Section
422A of the Code or any regulations or rulings issued by the Internal Revenue
Service for any reason; (ii) are in excess of the fair market value limitations
set forth in Section 6(d); or (iii) are designated at the time of grant as
Non-Qualified Stock Options, shall be deemed Non-Qualified Stock Options under
this Plan.  Non-Qualified Stock Options granted or substituted hereunder shall
be so designated in the stock option agreement entered into between the
Corporation and the Optionee.


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7.  STOCK OPTION EXERCISE PRICE

         (a) MINIMUM PRICE.  The exercise price of any Option Shares shall be
determined by the Stock Option Committee, in its sole and absolute discretion,
upon the grant of a Stock Option.  Except as provided elsewhere herein, said
exercise price shall not be less than one hundred percent (100%) of the Fair
Market Value of the Common Stock represented by the Option Share on the date of
grant of the related Stock Option.

         (b) EXCHANGED STOCK OPTIONS.  Where the outstanding shares of stock of
another corporation are changed into or exchanged for shares of Common Stock of
the Corporation without monetary consideration to that other corporation, then,
subject to the approval of the Board or Directors of the Corporation, Stock
Options may be granted in exchange for unexercised, unexpired stock options of
the other corporation, and the exercise price of the Option Shares subject to
each Stock Option so granted may be fixed at a price less than one hundred
percent (100%) of the Fair Market Value of the Common Stock at the time such
Stock Option is granted if said exercise price has been computed to be not less
than the exercise price set forth in the stock option of the other corporation,
with appropriate adjustment to reflect the exchange ratio of the shares of stock
of the other corporation into the shares of Common Stock of the Corporation.

8.  EXERCISE OF STOCK OPTIONS.

         (a) EXERCISE.  Except as otherwise provided elsewhere herein, each
Stock Option shall be exercisable in such increments, which need not be equal,
and upon


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such contingencies as the Stock Option Committee shall determine at the time of
grant of the Stock Option; provided, however, (i) that if an Optionee shall not
in any given period exercise any part of a Stock Option which has become
exercisable during that period, the Optionee's right to exercise such part of
the Stock Option shall continue until expiration of the Stock Option or any part
thereof as may be provided in the related stock option agreement, and (ii) a
minimum of 20% of the Stock Option shall be exercisable in each year over a five
year period from the date the option is granted.  No Stock Option or part
thereof shall be exercisable except with respect to whole shares of Common
Stock, and fractional share interests shall be disregarded except that they may
be accumulated.

         (b) PRIOR OUTSTANDING INCENTIVE STOCK OPTIONS.  Incentive Stock
Options granted to an Optionee may be exercisable while such Optionee has
outstanding and unexercised any Incentive Stock Option previously granted (or
substituted) to him or her pursuant to this Plan.  The Stock Option Committee
shall determine if such options shall be exercisable if there are any Incentive
Stock Options previously granted (or substituted) to him or her pursuant to this
Plan, and such determination shall be evidenced in the Agreement executed by the
Optionee and Company.  An Incentive Stock Option shall be treated as outstanding
until it is exercised in full or expires by reason of lapse of time.

         (c) NOTICE AND PAYMENT.  Stock Options granted hereunder shall be
exercised by written notice delivered to the Corporation specifying the number
of Option Shares with respect to which the Stock Option is being exercised,
together


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with concurrent payment in full of the exercise price as hereinafter provided in
Section 8(d) hereof.  If the Stock Option is being exercised by any person or
persons other than the Optionee, said notice shall be accompanied by proof,
satisfactory to counsel for the Corporation, of the right to such person or
persons to exercise the Stock Option.  The Corporation's receipt of a notice of
exercise without concurrent receipt of the full amount of the exercise price
shall not be deemed an exercise of a Stock Option by an Optionee, and the
Corporation shall have no obligation to an Optionee for any Option Shares unless
and until full payment of the exercise price is received by the Corporation in
accordance with Section 8(d) hereof, and all of the terms and provisions of the
Plan and the related stock option agreement have been complied with.

         (d) PAYMENT OF EXERCISE PRICE.  The exercise price of any Option
Shares purchased upon the proper exercise of a Stock Option shall be paid in
full at the time of each exercise of a Stock Option in cash and/or, with the
prior written approval of the Stock Option Committee, in Common Stock of the
Corporation which, when added to the cash payment, if any, has an aggregate Fair
Market Value equal to the full amount of the exercise price of the Stock Option,
or part thereof, then being exercised and/or, with the prior written approval of
the Stock Option Committee, on a deferred basis evidenced by a promissory note,
containing such terms and subject to such security as the Stock Option Committee
shall determine to be fair and reasonable from time to time, for the total
option price for the number of shares so purchased.   In addition, the Optionee
shall have the right upon the exercise of this Stock Option in the manner set
forth above to surrender for cancellation a portion of this Stock Option


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to the Company for the number of shares (the "Surrendered Shares") specified in
the holder's notice of exercise, by delivery to the Company with such notice
written instructions from such holder to apply the Appreciated Value (as defined
below) of the Surrendered Shares to payment of the exercise price for shares
subject to this Stock Option that are being acquired upon such exercise.  The
term "Appreciated Value" for each share subject to this Stock Option shall mean
the excess of the Fair Market Value thereof over the exercise price then in
effect.  No director, consultant or business associate may purchase any Stock
Option on a deferred basis evidenced by a promissory note. Unless payment is on
a deferred basis, payment by an Optionee as provided herein shall be made in
full concurrently with the Optionee's notification to the Corporation of his
intention to exercise all or part of a Stock Option.  If all or part of payment
is made in shares of Common Stock as heretofore provided, such payment shall be
deemed to have been made only upon receipt by the Corporation of all required
share certificates, and all stock powers and other required transfer documents
necessary to transfer the shares of Common Stock to the Corporation.

         (e) REORGANIZATION.  Notwithstanding any provision in any stock option
agreement pertaining to the time of exercise of a Stock Option, or part thereof,
upon adoption by the requisite holders of the Corporation's outstanding shares
of Common Stock of any plan of dissolution, liquidation, reorganization, merger,
consolidation or sale of all or substantially all of the assets of the
Corporation to another corporation, or the acquisition of stock representing
more than 50% of the voting power of the Corporation then outstanding, by
another corporation or person, which would, upon


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consummation, result in termination of a Stock Option in accordance with Section
15 hereof, the Stock Option shall become immediately exercisable as to all
vested Option Shares for such period of time as may be determined by the Stock
Option Committee, but in any event not less than 30 days prior to the adoption
of the plan of dissolution, liquidation, reorganization, merger, consolidation,
sale, or acquisition on the condition that the terminating event described in
Section 15 hereof is consummated.  Any Option Shares not exercised will be
terminated.  If such Terminating Event is not consummated, Stock Options granted
pursuant to the Plan shall be exercisable in accordance with their respective
terms.

         (f) MINIMUM EXERCISE.  Not less than ten (10) Option Shares may be
purchased at any one time upon exercise of a Stock Option unless the number of
shares purchased is the total number which remains to be purchased under the
Stock Option.

         (g) COMPLIANCE WITH LAW.  No shares of Common Stock shall be issued by
the Corporation upon exercise of any Stock Option, and an Optionee shall have no
rights or claim to such shares, unless and until: (a) payment in full as
provided in Section 8(d) hereof has been received by the Corporation; (b) in the
opinion of the counsel for the Corporation, all applicable registration
requirements of the Securities Act of 1933, all applicable listing requirements
of securities exchanges or associations on which the Corporation's Common Stock
is then listed or traded, and all other requirements of law and of regulatory
bodies having jurisdiction over such issuance and delivery, have been fully
complied with; and (c) if required by federal or state law


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or regulation, the Optionee shall have paid to the Corporation the amount, if
any, required to be withheld on the amount deemed to be compensation to the
Optionee as a result of the exercise of his or her Stock Option, or made other
arrangements satisfactory to the Corporation, in its sole discretion, to satisfy
applicable income tax withholding requirements.

9.  NONTRANSFERABILITY OF STOCK OPTIONS.

    Each Stock Option shall, by its terms, be nontransferable by the Optionee
other than by will or the laws of descent and distribution, and shall be
exercisable during the Optionee's lifetime only by the Optionee or his or her
guardian or legal representative.

10.  CONTINUATION OF EMPLOYMENT

    Each Optionee other than directors, consultants and business associates,
agree, as part of the acceptance of the option that he/she will remain, within
the employ of the Corporation, or any subsidiary corporation, for at least one
(l) year from the date the option is granted subject to prior termination, leave
of absence or vacation issued by the Board of Directors, subject to any
employment agreements to the contrary which shall govern.  Nothing contained in
the Plan (or in any stock option agreement) shall obligate the Corporation or
any Subsidiary corporation to employ or continue to employ or continue the
service as a director of any Optionee or any Eligible Participant for any period
of time or interfere in any way with the right of the Corporation or a
Subsidiary corporation to reduce or increase the Optionee's or Eligible
Participant's compensation.

11.  CESSATION OF EMPLOYMENT


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    Except as provided in Sections 8(e), 12, 13, 14 or 15 hereof, except if
Optionee is granted an option as a consultant, business associate or other
person or entity with important business relationships with the Corporation, if,
for any reason, an Optionee's status as an Eligible Participant is terminated,
the Stock Options granted to such Optionee shall expire on the expiration dates
specified for said Stock Options at the time of their initial grant, or three
(3) months after the Optionee's status as an Eligible Participant is terminated,
whichever is earlier.  During such period after Options shall be exercisable
only as to those increments, if any, which had become exercisable as of the date
on which such Optionee's status as an Eligible Participant terminated, and any
Stock Options or increments which had not become exercisable as of such date
shall expire and terminate automatically on such date.  If Optionee is granted
an option as a consultant, business associate or other person or entity with
important business relationships with the Corporation, this Stock Option shall
not expire as a result of consultant, business associate or other person or
entity with important business relationships with the Corporation no longer
doing business or otherwise terminating his or its business relationship with
the Corporation.

12.  DEATH OF OPTIONEE

    Except if Optionee is granted an option as a consultant, business associate
or other person or entity with important business relationships with the
Corporation, if an Optionee loses his status as an Eligible Participant by
reason of death, or if an Optionee dies during the three-month period referred
to in Section 11 hereof, the Stock Options granted to such Optionee shall expire
on the expiration dates specified for said


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Stock Options at the time of their initial grant, or one (l) year after the date
of such death, whichever is earlier.  If Optionee is granted an option as a
consultant, business associate or other person or entity with important business
relationships with the Corporation, this Stock Option shall not expire as a
result of such Optionee's death.  After such death but before such expiration,
subject to the terms and provisions of the Plan and the related stock option
agreements, the person or persons to whom such Optionee's rights under the Stock
Options shall have passed by will or by the applicable laws of descent and
distribution, or the executor or administrator of the Optionee's estate, shall
have the right to exercise such Stock Options to the extent that increments, if
any, had become exercisable as of the date on which the Optionee's status as an
Eligible Participant had been lost.

13.  DISABILITY OF OPTIONEE

    Except if Optionee is granted an option as a consultant, business associate
or other person or entity with important business relationships with the
Corporation, if an Optionee is disabled while employed by or while serving as a
director of the Corporation or a Subsidiary or during the three-month period
referred to in Section 11 hereof, the Stock Options granted to such Optionee
shall expire on the expiration dates specified for said Stock Options at the
time of their initial grant, or one (l) year after the date of such disability,
whichever is earlier.   If Optionee is granted an option as a consultant,
business associate or other person or entity with important business
relationships with the Corporation, this Stock Option shall not expire as a
result of such Optionee's disability.  After such disability but before such
expiration, the


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Optionee or a guardian or conservator of the Optionee's estate, as duly
appointed by a court of competent jurisdiction, shall have the right to exercise
such Stock Options to the extent that increments, if any, had become exercisable
as of the date on which the Optionee became disabled or ceased to be employed by
the Corporation or a Subsidiary as a result of the disability.  For the purpose
of this Section 13, an Optionee shall be deemed to have become "disabled" if it
shall appear to the Stock Option Committee, upon written certification delivered
to the Corporation by a qualified licensed physician, that the Optionee has
become permanently and totally unable to engage in any substantial gainful
activity by reason of any medically determinable physical or mental impairment
which can be expected to result in death, or which has lasted or can be expected
to last for a continuous period of not less than 12 months.

14.  ADJUSTMENT UPON CHANGES IN CAPITALIZATION

    If the outstanding shares of Common Stock of the Corporation are increased,
decreased, or changed into or exchanged for a different number or kind of shares
or securities of the Corporation, through a reorganization, merger,
recapitalization, reclassification, stock split, stock dividend, stock
consolidation, or otherwise, without consideration to the Corporation, an
appropriate and proportionate adjustment shall be made in the number and kind of
shares as to which Stock Options may be granted.  A corresponding adjustment
changing the number or kind of Option Shares and the exercise prices per share
allocated to unexercised Stock Options, or portions thereof, which shall have
been granted prior to any such change, shall likewise be made.  Any such
adjustment, however, in an outstanding Stock Option shall be made without


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change in the total price applicable to the unexercised portion of the Stock
Option, but with a corresponding adjustment in the price for each Option Share
subject to the Stock Option.  Any adjustment under this Section shall be made by
the Stock Option Committee, whose determination as to what adjustments shall be
made, and the extent thereof, shall be final and conclusive.  No fractional
shares of stock shall be issued or made available under the Plan on account of
any such adjustment, and fractional share interests shall be disregarded and the
fractional share interest shall be rounded down to the nearest whole number.

15.  TERMINATING EVENTS

    Not less than thirty (30) days prior to consummation of a plan of
dissolution or liquidation of the Corporation, or consummation of a plan of
reorganization, merger or consolidation of the Corporation with one or more
corporations, as a result of which the Corporation is not the surviving
corporation and the outstanding securities of the class then subject to options
hereunder are changed or exchanged for cash or property or securities not of the
Corporation's issue, or upon the sale of all or substantially all the assets of
the Corporation to another corporation, or the acquisition of stock representing
more than fifty percent (50%) of the voting power of the Corporation then
outstanding by another corporation or person (the "Terminating Event"), the
Stock Option Committee or the Board of Directors shall notify each Optionee of
the pendency of the Terminating Event.  Upon the effective date of the
Terminating Event, the Plan shall automatically terminate and all Stock Options
theretofore granted shall terminate, unless provision is made in connection with
such transaction for the


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continuance of the Plan and/or assumption of Stock Options theretofore granted,
or substitution for such Stock Options with new stock options covering stock of
a successor employer corporation, or a parent or subsidiary corporation thereof,
solely at the discretion of such successor corporation, or parent or subsidiary
corporation, with appropriate adjustments as to number and kind of shares and
prices, in which event the Plan and options theretofore granted shall continue
in the manner and under the terms so provided.  If the Plan and unexercised
options shall terminate pursuant to the foregoing sentence, all persons shall
have the right to exercise the vested portions of options then outstanding and
not exercised, shall have the right, at such time prior to the consummation of
the transaction causing such termination as the Corporation shall designate and
for a period of not less than 30 days, to exercise the vested portions of their
options.

16.  AMENDMENT AND TERMINATION

    The Board of Directors of the Corporation may at any time and from
time-to-time suspend, amend, or terminate the Plan and may, with the consent of
Optionee, make such modifications of the terms and conditions of a Stock Option
as it shall deem advisable; provided that, except as permitted under the
provisions of Section 15 hereof, no amendment or modification may be adopted
without the Corporation having first obtained all necessary regulatory approvals
and approval of the holders of a majority of the Corporation's shares of Common
Stock present, or represented, and entitled to vote at a duly held meeting of
shareholders of the Corporation if the amendment or modification would:


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         (a) materially increase the benefits accruing to participants under
the Plan;

         (b) materially increase the number of securities which may be issued
under the Plan;

         (c) materially modify the requirements as to eligibility for
participation in the Plan;

         (d) increase or decrease the exercise price of any Stock Options
granted under the Plan;

         (e) increase the maximum term of Stock Options provided for herein;

         (f) permit Stock Options to be granted to any person who is not an
Eligible Participant; or

         (g) change any provision of the Plan which would affect the
qualification as an Incentive Stock Option under the Plan.

    No Stock Option may be granted during any suspension of the Plan or after
termination of the Plan.  Amendment, suspension, or termination of the Plan
shall not (except as otherwise provided in Section 16 hereof), without the
consent of the Optionee, alter or impair any rights or obligations under any
Stock Option theretofore granted.


                                         -21-


<PAGE>

17.  RIGHTS OF ELIGIBLE PARTICIPANTS AND OPTIONEES

    Neither any Eligible Participant, any Optionee or any other person shall
have any claim or right to be granted any Stock Option under this Plan, and
neither this Plan nor any action taken hereunder shall be deemed or construed as
giving any Eligible Participant, Optionee or any other person any right to be
retained in the employ of the Corporation or any subsidiary of the Corporation.
Without limiting the generality of the foregoing, there is no vesting of any
right in the classification of any person as an Eligible Participant or
Optionee, such classification being used solely to define and limit those
persons who are eligible for consideration of the grant of Stock Options under
the Plan.

18.  PRIVILEGES OF STOCK OWNERSHIP; SECURITIES LAW COMPLIANCE; NOTICE OF SALE

    No Optionee shall be entitled to the privileges of stock ownership as to
any Option Shares not actually issued and delivered.  No Option Shares may be
purchased upon the exercise of a Stock Option unless and until all then
applicable requirements of all regulatory agencies having jurisdiction and all
applicable requirements of securities exchanges upon which the stock of the
Corporation is listed (if any) shall have been fully complied with.  The
Corporation will diligently endeavor to comply with all applicable securities
laws before any options are granted under the Plan and before any stock is
issued pursuant to options.  The Optionee shall, not more than five (5) days
after each sale or other disposition of shares of Common Stock acquired pursuant
to the exercise of Stock Options, give the Corporation notice in writing of such
sale or other disposition.


                                         -22-


<PAGE>

    The Corporation will provide to each Optionee its Annual Report as required
by Section 260.140.46 of the regulations of the California Commissioner of
Corporations.

19.  EFFECTIVE DATE OF THE PLAN

    The Plan shall be deemed adopted as of March 16, 1993, as amended and shall
be effective immediately, subject to approval of the Plan by the holders of at
least a majority of the corporation's outstanding shares of Common Stock and
approval of the Plan by the California Commissioner of Corporations.

20.  TERMINATION

    Unless previously terminated as aforesaid, the Plan shall terminate ten
(10) years from the earliest date of (i) adoption of the Plan by the Board of
Directors, (ii) approval of the Plan by holders of at least a majority of the
Corporation's outstanding shares of Common Stock, or (iii) approval of the Plan
by the California Commissioner of Corporations.  No Stock Options shall be
granted under the Plan thereafter, but such termination shall not affect any
Stock Option theretofore granted.

21.  OPTION AGREEMENT

    Each Stock Option granted under the Plan shall be evidenced by a written
stock option agreement executed by the Corporation and the Optionee, and shall
contain each of the provisions and agreements herein specifically required to be
contained therein, and such other terms and conditions as are deemed desirable
by the Stock Option Committee and are not inconsistent with the Plan.


                                         -23-


<PAGE>

22.  STOCK OPTION PERIOD

    Each Stock Option and all rights and obligations thereunder shall expire on
such date as the Stock Option Committee may determine, but not later than ten
(10) years from the date such Stock Option is granted, and shall be subject to
earlier termination as provided elsewhere in the Plan.

23.  EXCULPATION AND INDEMNIFICATION OF STOCK OPTION COMMITTEE

    In addition to such other rights of indemnification which they may have as
directors of the Corporation or as members of the Stock Option Committee, the
present and former members of the Stock Option Committee, and each of them,
shall be indemnified by the Corporation for and against all costs, judgments,
penalties and reasonable expenses, including reasonable attorney's fees,
actually and necessarily incurred by them in connection with any action, suit or
proceeding, or in connection with any appeal thereof, to which they or any of
them may be a party by reason of any act or omission of any member of the Stock
Option Committee under or in connection with the Plan or any Stock Option
granted thereunder; provided, however, that a member of the Stock Option
Committee shall not be entitled to any indemnification whatsoever pursuant to
this Section for or as a result of any act or omission of such member which was
not taken in good faith and which constituted willful misconduct or gross
negligence by such member; provided further, that any amounts paid by any member
of the Stock Option Committee in settlement of any action, suit or proceeding
for which indemnification may be sought pursuant to this Section shall be first
approved in writing by independent legal counsel selected by the


                                         -24-


<PAGE>

Corporation; and, provided further, that within thirty (30) days after
institution of any action, suit or proceeding against any member with respect to
which such member is entitled to indemnification hereunder, such member shall,
in writing, offer the Corporation the opportunity, at its own expense, to handle
(including settle) and conduct the defense thereof.  The provisions of this
Section shall apply to the estate, executor and administrator of each member of
the Stock Option Committee.

24.  AGREEMENT AND REPRESENTATIONS OF OPTIONEE

    Unless the shares of Common Stock covered by this Plan have been registered
with the Securities and Exchange Commission pursuant to Section 5 of the
Securities Act of 1933, each Optionee shall by and upon accepting a Stock
Option, represent and agree in writing, for himself or herself and his or her
transferees by will or the laws of descent and distribution, that he or she is a
bona fide California resident, that all such Option Shares will be acquired for
investment purposes and not for resale or distribution and that the optioned
stock will not be transferred to a person who is not a California resident.
Upon the exercise of a Stock Option, or a part thereof, the person entitled to
exercise the same shall, unless waived by the Corporation, furnish evidence
satisfactory to the Corporation, including written and signed representations,
to the effect that he or she is a California resident, that the Option Shares
are being acquired for investment purposes and not for resale or distribution,
and that the Option Shares being acquired shall not be sold or otherwise
transferred to any individual or entity not a resident of the State of
California.  Furthermore, the Corporation, at its sole discretion, to assure
itself that any sale or distribution by the Optionee complies


                                         -25-


<PAGE>

with this Plan and any applicable federal or state securities laws, may take all
reasonable steps, including placing stop transfer instructions with the
corporation's transfer agent prohibiting transfers in violation of the Plan and
affixing the following legend (and/or such other legend or legends as the Stock
Option Committee shall require) on certificates evidencing the shares:

         "IT IS UNLAWFUL TO CONSUMMATE A SALE OR TRANSFER OF THIS
         SECURITY, OR ANY INTEREST THEREIN, OR TO RECEIVE ANY
         CONSIDERATION THEREFOR, WITHOUT THE PRIOR WRITTEN CONSENT OF
         THE COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA,
         EXCEPT AS PERMITTED IN THE COMMISSIONER'S RULES."

and

         "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
         REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND
         MAY NOT BE SOLD, PLEDGED, HYPOTHECATED OR OTHERWISE
         TRANSFERRED OR OFFERED FOR SALE IN THE ABSENCE OF AN
         EFFECTIVE REGISTRATION STATEMENT WITH RESPECT TO THEM UNDER
         THE ACT OR A DETERMINATION BY MONARCH BANCORP THAT
         REGISTRATION IS NOT REQUIRED."

At any time that an Optionee contemplated the disposition of any of the Option
Shares (whether by sale, exchange, gift or other form of transfer) he or she
shall first notify the Corporation of such proposed disposition and shall
thereafter cooperate with the Corporation in complying with all applicable
requirements of law which, in the opinion of counsel for the Corporation, must
be satisfied prior to the making of such disposition.  Before  consummating such
disposition, Monarch Bancorp shall determine that such disposition will not
result in a violation of any state or federal securities law


                                         -26-


<PAGE>

or regulations.  The Corporation shall remove any legend affixed to certificates
for Option Shares pursuant to this Section if and when all of the restrictions
on the transfer of the Option Shares, whether imposed by this Plan or federal or
state law, have terminated.  An Optionee who thereafter sells or disposes of his
shares of Common Stock will be required to notify the Corporation of such sale
or disposition within five (5) days after the sale or disposition.

25.  NOTICES

    All notices and demands of any kind which the Stock Option Committee, any
Optionee, Eligible Participant, or any other person may be required or desires
to serve under the terms of this Plan shall be in writing and shall be served by
personal service upon the respective person or by leaving a copy of such notice
or demand at the address of such person as may be reflected in the records of
the Corporation, or in the case of the Stock Option Committee, with the
Secretary of the Corporation, or by mailing a copy thereof by certified or
registered mail, postage prepaid, with return receipt requested.  In the case of
service by mail, it shall be deemed complete at the expiration of the third day
after the day of mailing, except for notice of the exercise of any Stock Option
and payment of the Stock Option exercise price, both of which must be actually
received by the Corporation.

26.  LIMITATION OF OBLIGATIONS OF THE CORPORATION

    Any obligation of the Corporation arising under or as a result of this Plan
or any Stock Option granted hereunder shall constitute the general unsecured
obligation of the Corporation, and not of the Board of Directors of the
Corporation, or any members


                                         -27-


<PAGE>

thereof, the Stock Option Committee, or any member thereof, any officer of the
Corporation, or any other person or any Subsidiary, and none of the foregoing,
except the Corporation, shall be liable for any debt, obligation, cost or
expense hereunder.

27.  LIMITATION OF RIGHTS

    The Stock Option Committee, in its sole and absolute discretion, is
entitled to determine who, if anyone, is an Eligible Participant under this
Plan, and which, if any, Eligible Participant shall receive any grant of a Stock
Option.  No oral or written agreement by any person on behalf of the Corporation
relating to this Plan or any Stock Option granted hereunder is authorized, and
such agreement may not bind the Corporation or the Stock Option Committee to
grant any Stock Option to any person.

28.  SEVERABILITY

    If any provision of this Plan as applied to any person or to any
circumstances shall be adjudged by a court of competent jurisdiction to be void,
invalid, or unenforceable, the same shall in no way effect any other provision
hereof, the application of any such provision in any other circumstances, or the
validity of enforceability hereof.

29.  CONSTRUCTION

    Where the context or construction requires, all words applied in the plural
shall be deemed to have been used in the singular and vice versa, and the
masculine gender shall include the feminine and the neuter.


                                         -28-


<PAGE>

30.  HEADINGS

    The headings of the several paragraphs of this Plan are inserted solely for
convenience of reference and are not intended to form a part of and are not
intended to govern, limit or aid in the construction of any term or provision
hereof.

31.  SUCCESSORS

    This Plan shall be binding upon the respective successors, assigns, heirs,
executors, administrators, guardians and personal representatives of the
Corporation and any Optionee.

32.  GOVERNING LAW

    This Plan shall be governed by and construed in accordance with the laws of
the State of California.

33.  CONFLICT

    In the event of any conflict between the terms and provisions of this Plan,
and any other document, agreement or instrument, including, without limitation,
any stock option agreement, the terms and provisions of this Plan shall control.


                                         -29-


<PAGE>

                         SECRETARY'S CERTIFICATE OF ADOPTION

         I, the undersigned, do hereby certify:

         1.  That I am the duly elected and acting Secretary of Monarch
Bancorp; and

         2.  That the foregoing Monarch Bancorp 1993 Stock Option Plan, as
amended, was duly amended by the Board of Directors of Monarch Bancorp as the
Stock Option Plan for the Corporation at meetings duly called as required by law
and convened on the 16th day of March, 1993, the 23rd day of May, 1995, and the
15th of May, 1996

         IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed the
seal of the Corporation this ____ day of __________, 1996.


                                       ---------------------------------------
                                                                Secretary



[SEAL]


                                         -30-