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

                                   FORM 10-QSB

      (Mark One)

|X|   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2005

|_|   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO

                       COMMISSION FILE NUMBER: 333-118883

                             VALLEY COMMERCE BANCORP
           (Name of small business issuer as specified in its charter)

           California                                    46-1981399
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
 incorporation or organization)

                             200 South Court Street
                            Visalia, California 93291
                    (Address of principal executive offices)

                                 (559) 622-9000
                           (Issuer's telephone number)

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15 (d) of the 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.

Yes |X| No |_|

The number of shares outstanding of the issuer's Common Stock was 2,087,508 as
of May 11, 2005.

Transitional Small Business Disclosure Format (check one)

Yes |_| No |X|

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


                                       1
<PAGE>

INDEX

PART I - FINANCIAL INFORMATION

ITEM 1 - FINANCIAL STATEMENTS

Consolidated Balance Sheets (unaudited) at March 31, 2005 and December 31, 2004

Consolidated Statements of Income (unaudited) for the Three Month Periods ended
March 31, 2005 and 2004

Consolidated Statements of Cash Flows (unaudited) for the Three Month Periods
ended March 31, 2005 and 2004.

Notes to Consolidated Financial Statements

ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS

ITEM 3 - CONTROLS AND PROCEDURES

PART II - OTHER INFORMATION

ITEM 1 LEGAL PROCEEDINGS

ITEM 2 UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

ITEM 3 DEFAULTS UPON SENIOR SECURITIES

ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

ITEM 5 OTHER INFORMATION

ITEM 6 EXHIBITS

SIGNATURES


                                       2
<PAGE>

                                     PART I

                           Forward-Looking Information

Certain matters discussed in this Quarterly Report on Form 10-QSB including, but
not limited to, those described in Item 2 - Management's Discussion and Analysis
or Plan of Operation, are forward-looking statements that are subject to risks
and uncertainties that could cause actual results to differ materially from
those projected in the forward-looking statements. Such risks and uncertainties
include, among others: (1) significant increases in competitive pressure in the
banking and financial services industries; (2) changes in the interest rate
environment, which could reduce anticipated or actual margins; (3) changes in
the regulatory environment; (4) general economic conditions, either nationally
or regionally and especially in the Company's primary service area, becoming
less favorable than expected and resulting in, among other things, a
deterioration in credit quality; (5) operational risks, including data
processing systems failures or fraud; (6) changes in business conditions and
inflation; (7)changes in technology; (8) changes in monetary and tax policies;
and (9)changes in the securities markets. Therefore, the information set forth
in such forward-looking statements should be carefully considered when
evaluating the business prospects of the Company.

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


                                       3
<PAGE>

ITEM 1 - FINANCIAL STATEMENTS

                             VALLEY COMMERCE BANCORP
                           CONSOLIDATED BALANCE SHEET
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                     March 31,       December 31,
                                                                                       2005             2004
                                                                                   -------------    -------------
<S>                                                                                <C>              <C>
Assets
------
Cash and due from banks                                                            $   8,682,634    $   9,036,062
Federal funds sold                                                                    11,220,000       17,750,000
                                                                                   -------------    -------------
     Total cash and cash equivalents                                                  19,902,634       26,786,062
Available-for-sale investment securities (amortized cost of $47,584,513 at March
   31, 2005 and $38,226,862 at December 31, 2004)                                     46,794,000       39,099,000
Loans, less allowance for loan losses of $1,431,818 at March 31, 2005 and
   $1,400,818 at December 31, 2004                                                   118,850,321      114,834,245
Bank premises and equipment, net                                                       1,112,857        1,033,586
Cash surrender value of Bank-owned life insurance                                      2,703,349        2,677,318
Accrued interest receivable and other assets                                           3,283,199        2,576,391
                                                                                   -------------    -------------
         Total assets                                                              $ 192,646,360    $ 186,006,602
                                                                                   =============    =============

Liabilities and Shareholders' Equity
------------------------------------

Deposits:
  Noninterest bearing                                                              $  54,336,819    $  58,394,071
  Interest bearing                                                                    60,911,199       54,689,181
  Time                                                                                43,929,994       43,340,652
                                                                                   -------------    -------------
     Total deposits                                                                  159,178,012      156,423,904
Accrued interest payable and other liabilities                                           907,847          834,588
Long-term debt                                                                         9,277,590        9,322,472
Junior subordinated deferrable interest debentures                                     3,093,000        3,093,000
                                                                                   -------------    -------------
       Total liabilities                                                             172,456,449      169,673,964
                                                                                   -------------    -------------

Commitments and contingencies (Note 5)

Shareholders' equity (Note 2 and 3):
  Serial preferred stock - no par value; 10,000,000 shares authorized, none
     issued                                                                                   --               --
  Common stock - no par value; 30,000,000 shares authorized; issued and
     outstanding - 2,087,508 shares at March 31, 2005 and 1,788,258 shares at
     December 31, 2004                                                                18,331,138       14,451,969
  Retained earnings                                                                    2,341,143        1,959,281
  Accumulated other comprehensive loss (Note 4)                                         (482,369)         (78,612)
                                                                                   -------------    -------------
       Total shareholders' equity                                                     20,189,911       16,332,638
                                                                                   -------------    -------------
       Total liabilities and shareholders' equity                                  $ 192,646,360    $ 186,006,602
                                                                                   =============    =============
</TABLE>

            See notes to unaudited consolidated financial statements.


                                       4
<PAGE>

                             VALLEY COMMERCE BANCORP
                        CONSOLIDATED STATEMENT OF INCOME
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                               For the Three Months
                                                                                  Ended March 31,
                                                                            -------------------------
                                                                                2005          2004
                                                                            -----------   -----------
<S>                                                                         <C>           <C>
Interest Income:
  Interest and fees on loans                                                $ 2,091,932   $ 1,719,257
  Interest on investment securities:
     Taxable                                                                    321,401       160,527
     Exempt from Federal income taxes                                            42,805        17,879
  Interest on Federal funds sold                                                123,505        14,304
  Interest on deposits in banks                                                                 1,765
                                                                            -----------   -----------
       Total interest income                                                  2,579,643     1,913,732
                                                                            -----------   -----------
Interest Expense:
  Interest on deposits                                                          402,749       257,987
  Interest on borrowings                                                         98,260        56,758
  Interest on junior subordinated deferrable interest debentures                 45,782        34,573
                                                                            -----------   -----------
       Total interest expense                                                   546,791       349,318
                                                                            -----------   -----------
         Net interest income before provision for loan losses                 2,032,852     1,564,414
Provision for Loan Losses                                                        31,000        35,000
                                                                            -----------   -----------
         Net interest income after provision for loan losses                  2,001,852     1,529,414
Non-Interest Income:
  Service charges                                                               123,824       116,936
  Gain on sale of available-for-sale investment securities, net                                 7,390
  Mortgage loan brokerage fees                                                   39,172        37,687
  Earnings on cash surrender value of life insurance policies                    26,031        18,514
  Other                                                                          38,372        33,368
                                                                            -----------   -----------
       Total noninterest income                                                 227,399       213,895
                                                                            -----------   -----------
Non-Interest Expense:
   Salaries and employee benefits                                               898,377       699,662
   Occupancy and equipment                                                      174,993       146,566
   Other                                                                        534,019       449,167
                                                                            -----------   -----------
       Total noninterest expense                                              1,607,389     1,295,395
                                                                            -----------   -----------
         Income before provision for income taxes                               621,862       447,914

Provision for income taxes                                                      240,000       164,000
                                                                            -----------   -----------
       Net income                                                           $   381,862   $   283,914
                                                                            ===========   ===========

Basic earnings per share (Notes 2 and 3)                                    $      0.19   $      0.20
Diluted earnings per share (Notes 2 and 3)                                  $      0.18   $      0.19
</TABLE>

            See notes to unaudited consolidated financial statements.


                                       5
<PAGE>

                             VALLEY COMMERCE BANCORP
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                           For the Three Months
                                                                                              Ended March 31,
                                                                                       ------------------------------
                                                                                           2005             2004
                                                                                       -------------    -------------
<S>                                                                                    <C>              <C>
Cash Flows from Operating Activities:
   Net income                                                                          $     381,862    $     283,914
   Adjustments to reconcile net income to net cash provided by operating activities:
   Provision for loan losses                                                                  31,000           35,000
   Increase in deferred loan origination fees, net                                            58,772           97,023
   Depreciation                                                                               46,167           35,750
   Amortization of intangibles                                                                15,634           15,634
   Provision for (benefit from) deferred income tax                                          (42,000)         177,239
   Net gain on sale of available-for-sale investment securities                                                (7,390)
   Amortization and accretion of investment securities, net                                   18,012           34,030
   Net loss on sale of premises and equipment                                                                     450
   Increase in cash surrender value of life insurance                                        (26,031)         (18,514)
   Increase(Decrease) in accrued interest receivable and other assets                       (421,113)        (350,560)
   Increase(Decrease) in accrued interest payable and other liabilities                       73,259        1,436,170
                                                                                       -------------    -------------
   Net cash provided by operating activities                                                 135,562        1,738,748
                                                                                       -------------    -------------

Cash Flows from Investing Activities:
   Proceeds from matured and called available-for-sale investment securities               1,500,000        2,900,001
   Proceeds from sales of available-for-sale investment securities                                          1,297,000
   Purchases of available-for-sale investment securities                                 (11,353,641)      (2,244,747)
   Proceeds from principal repayments from available-for-sale government-guaranteed
      mortgage-backed securities                                                             477,544          537,776
   Purchase of Federal Home Loan Bank Stock                                                                    (7,100)
   Decrease in interest-bearing deposits with banks                                                           198,000
   Net increase in loans                                                                  (4,105,848)      (2,486,356)
   Purchase of premises and equipment                                                       (125,438)         (30,938)
   Life insurance policy deposit                                                                           (1,000,000)
                                                                                       -------------    -------------
   Net cash used in investing activities                                                 (13,607,383)        (836,364)
                                                                                       -------------    -------------
</TABLE>

                             Continued on next page.


                                       6
<PAGE>

                             VALLEY COMMERCE BANCORP
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                   (UNAUDITED)
                                   (Continued)

<TABLE>
<CAPTION>
                                                                                   For the Three Months
                                                                                      Ended March 31,
                                                                               ----------------------------
                                                                                   2005            2004
                                                                               ------------    ------------
<S>                                                                            <C>             <C>
Cash Flows from Financing Activities:
    Net increase (decrease) in demand, interest bearing and savings deposits   $  2,164,766    $ (1,075,731)
    Net increase in time deposits                                                   589,342         769,093
    Proceeds from the issuance of stock                                           3,879,167
    Proceeds from Federal Home Loan Bank term advances                                              200,000
    Payments on Federal Home Loan Bank term advances                                (44,882)        (97,766)
                                                                               ------------    ------------
        Net cash provided by financing activities                                 6,588,393        (204,404)
                                                                               ------------    ------------

          Increase (decrease) in cash and cash equivalents                       (6,883,428)        697,980
Cash and Cash Equivalents at Beginning of Year                                   26,786,062      11,754,585
                                                                               ------------    ------------
Cash and Cash Equivalents at End of Period                                     $ 19,902,634    $ 12,452,565
                                                                               ============    ============

Supplemental Disclosure of Cash Flow Information:
  Cash paid during the period for:
    Interest expense                                                           $    269,546    $    376,246
    Income taxes                                                               $    455,000    $    250,000

Non-Cash Investing Activities:
  Net change in unrealized loss on available-for-sale securities               $   (663,085)   $    163,397
</TABLE>

            See notes to unaudited consolidated financial statements.


                                       7
<PAGE>

                             VALLEY COMMERCE BANCORP
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

1.    GENERAL

All adjustments (consisting only of normal recurring accruals) which, in the
opinion of Management, are necessary for a fair presentation of Valley Commerce
Bancorp's (the "Company") consolidated financial position at March 31, 2005 and
December 31, 2004; the results of its operations for the three-month periods
ended March 31, 2005 and 2004, and changes in its cash flows for the three-month
periods ended March 31, 2005 and 2004 have been included. Certain disclosures
normally presented in the notes to the annual consolidated financial statements
prepared in accordance with accounting principles generally accepted in the
United States of America have been omitted. These interim consolidated financial
statements should be read in conjunction with the consolidated financial
statements and notes thereto included in the Company's 2004 Annual Report on
Form 10-KSB. The results of operations and cash flows for the periods presented
are not necessarily indicative of the results for a full year.

The accompanying unaudited financial statements have been prepared on a basis
consistent with the accounting principles and policies reflected in the
Company's Annual Report on Form 10-KSB for the year ended December 31, 2004.

2.    STOCK-BASED COMPENSATION

At March 31, 2005, the Company had one stock-based compensation plan, for which
249,284 shares of common stock are reserved for issuance to employees and
directors under incentive and non-statutory agreements. The Company accounts for
this plan under the recognition and measurement principles of APB Opinion No.
25, Accounting for Stock Issued to Employees, and related Interpretations. No
stock-based compensation cost is reflected in net income, as all options granted
under these plans had an exercise price equal to the market value of the
underlying common stock on the date of grant.

Statement of Financial Accounting Standards (SFAS) No. 123 Accounting for
Stock-Based Compensation, requires the disclosure of pro forma net income and
earnings per share as if the Company had adopted the fair value method of
accounting for stock-based compensation. Under SFAS No. 123, the fair value of
stock-based awards to employees is calculated through the use of option pricing
models, even though such models were developed to estimate the fair value of
freely tradable, fully transferable options without vesting restrictions, which
significantly differ from the Company's stock option awards. These models also
require subjective assumptions, including future stock price volatility and
expected time to exercise, which greatly affect the calculated values. During
the three-month period ended March 31, 2005, no options were awarded by the
Company to its officers and directors. During the three-month period ended March
31, 2004, options for 34,196 shares of common stock were awarded by the Company
to its officers and directors. The calculated weighted average fair value of the
options granted in the 2004 period was $4.10 per option.


                                       8
<PAGE>

A summary of the pro forma effects to reported net income and earnings per share
as if the Company had elected to recognize compensation cost based on the fair
value of the options granted as prescribed by SFAS No. 123 is as follows:

                                                          For the Three Months
                                                             Ended March 31,
                                                        ------------------------
                                                           2005          2004
                                                        ---------     ---------
Net income as reported                                  $ 381,862     $ 283,914
Deduct: Total stock-based compensation expense
   determined under the fair value based method
   for all awards, net of related tax effects             (7,000)       (7,500)
                                                        ---------     ---------
   Pro forma net income                                 $ 374,862     $ 276,414
                                                        =========     =========

Basic earnings per share - as reported                  $    0.19     $    0.20
                                                        =========     =========
Basic earnings per share - pro forma                    $    0.18     $    0.19
                                                        =========     =========

Diluted earnings per share - as reported                $    0.18     $    0.19
                                                        =========     =========
Diluted earnings per share - pro forma                  $    0.18     $    0.18
                                                        =========     =========

3.    EARNINGS PER SHARE COMPUTATION

Basic earnings per share are computed by dividing net income by the weighted
average common shares outstanding for the period. Diluted earnings per share
reflect the potential dilution that could occur if outstanding stock options
were exercised. Diluted earnings per share are computed by dividing net income
by the weighted average common shares outstanding for the period plus the
dilutive effect of options. Earnings per share computations have been
retroactively adjusted for stock splits and stock dividends for all periods
presented.

                                                         For the Three Months
                                                           Ended March 31,
                                                      --------------------------
                                                          2005           2004
                                                      -----------    -----------
Earnings Per Share:
  Basic earnings per share                            $      0.19    $      0.20
  Diluted earnings per share                          $      0.18    $      0.19
Weighted Average Number of Shares Outstanding:
  Basic shares                                          2,087,508      1,437,508
  Diluted shares                                        2,110,206      1,525,073

Shares of common stock issuable under stock options for which the exercise
prices are greater than the average market prices are not included in the
computation of diluted earnings per share due to their antidilutive effect. In
the three-month period ended March 31, 2004, a total of 34,196 stock options are
not included in the computation of diluted earnings per share. There were no
options granted in the 2005 period.

4.    COMPREHENSIVE (LOSS) INCOME

Total comprehensive (loss) income for the three-month periods ended March 31,
2005 and 2004 totaled ($21,895) and $385,345, respectively. Other comprehensive
loss, comprised of net changes in unrealized gains and (losses), net of taxes,
on available-for-sale investment securities, totaled ($403,757) and $101,431 for
the three-month periods ended March 31, 2005 and 2004, respectively. At March
31, 2005 and December 31, 2004, accumulated other comprehensive income / (loss)
totaled ($482,369) and ($78,612), respectively, and as reflected as a component
of shareholders' equity.


                                       9
<PAGE>

5.    COMMITMENTS AND CONTINGENCIES

In the normal course of business, the Company has various outstanding
commitments to extend credit which are not reflected in the financial
statements, including loan commitments of $30.2 million and $28.6 million and
letters of credit of $1.6 million and $0.9 million at March 31, 2005 and
December 31, 2004, respectively.

At March 31, 2005, consumer loan commitments represent approximately 9% of total
commitments and are generally unsecured. Agricultural loan commitments represent
approximately 7% of total commitments and are generally secured by crops and/or
real estate. Commercial loan commitments represent approximately 52% of total
commitments and are generally secured by various assets of the borrower. Real
estate loan commitments represent the remaining 32% of total commitments and are
generally secured by property with a loan-to-value ratio not to exceed 80%. In
addition, the majority of the Bank's commitments have variable interest rates.
Total commitments do not necessarily represent future cash requirements. Each
loan commitment and the amount and type of collateral obtained, if any, are
evaluated on an individual basis. Collateral held varies, but may include real
property, bank deposits, debt or equity securities or business assets.

Stand-by letters of credit are conditional commitments written to guarantee the
performance of a customer to a third party. These guarantees are primarily
related to the purchases of inventory by commercial customers and are typically
short-term in nature. Credit risk is similar to that involved in extending loan
commitments to customers and, accordingly, evaluation and collateral
requirements similar to those for loan commitments are used. Stand-by letters of
credit are accounted for under Financial Accounting Standards Board
Interpretation 45, Guarantor's Accounting and Disclosure Requirements for
Guarantees, Including Indirect Guarantees of Others (FIN 45). FIN 45 requires
that the guarantor recognize a liability for the guarantee equal to its fair
value represented by the fees received for issuing the guarantee. The defferred
liability related to the Company's letters of credit was not considered
significant at March 31, 2005 or December 31, 2004.


                                       10
<PAGE>

ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS

The following discussion and analysis of the Company's financial condition and
results of operations should be read together with the financial statements and
notes thereto appearing in Item 1, Financial Statements, included in this
Quarterly Report on Form 10-QSB.

Introduction

Valley Commerce Bancorp (the Company) is the holding company for Bank of
Visalia, a California state chartered bank. The Company's principal business is
to provide, through its banking subsidiary, financial services in its primary
market area in California. The Company serves Tulare and Fresno Counties and the
surrounding area through the Bank. The Company derives its income primarily from
interest received on real estate related loans, commercial loans, and consumer
loans and to a lesser extent fees from the brokerage of loans, interest on
investment securities and fees for services provided to deposit customers. The
Company's major operating expenses are interest paid on deposits and borrowings
and general operating expenses, consisting primarily of salaries and employee
benefits and, to a lesser extent, occupancy and equipment, data processing and
operations. The Company does not currently conduct any operations other than
through the Bank.

The Company's founders opened the Bank in 1996 to serve as a community bank in
the city of Visalia, which is the primary metropolitan area of Tulare County, as
well as surrounding areas. The Bank operated solely from its branch office in
Visalia until 1998 when the Bank purchased two branch offices from Bank of
America in the Tulare County towns of Woodlake and Tipton. In October 2003, the
Bank acquired the branch facilities and deposits of the Fresno branch of
Humboldt Bank. This location was the Bank's first office outside of Tulare
County and achieved the Bank's strategic goal of entering the Fresno
marketplace. One of the Company's primary strategic objectives is to continue
expanding within the South San Joaquin Valley by opening de novo branches and
loan production offices, and by acquiring branches from other institutions
should they become available.

The Bank plans to change its name to "Valley Business Bank" in July 2005.

Overview

The Company earned net income of $382,000, or $0.18 per diluted share, for the
quarter ended March 31, 2005, compared to $284,000, or $0.19 per diluted share,
for the quarter ended March 31, 2004. The annualized quarterly return on average
assets was 0.80% for 2005 and 0.81% for 2004. The annualized quarterly return on
average shareholders' equity for 2005 and 2004 was 8.11% and 10.11%,
respectively.

At March 31, 2005, the Company's total assets were $193 million, representing an
increase of $52 million or 37% compared to March 31, 2004. Total loans, net of
the allowance for loan losses, were $119 million at March 31, 2005, representing
an increase of $15 million or 15% compared to March 31, 2004. Total deposits
were $159 million at March 31, 2005, representing an increase of $40 million or
34% compared to March 31, 2004. Comparing March 31, 2005 and December 31, 2004
balances, total assets increased by $6.6 million or 4%, total net loans
increased by $4.0 million or 3%, and total deposits increased by $2.7 million or
2%.

At March 31, 2005, the Company's leverage ratio was 12.1% while its tier 1
risk-based capital ratio and total risk-based capital ratios were 17.6% and
18.6%, respectively. At December 31, 2004, the Company's leverage ratio was
10.8% while its tier 1 risk-based capital ratio and total risk-based capital
ratios were 14.7% and 15.8%, respectively. The leverage, tier 1 risk-based
capital and total risk-based capital ratios at March 31, 2004 were 10.1%, 13.1%
and 14.4%, respectively.

The following discussing and analysis sets forth certain financial and
statistical information relating to the Company as of March 31, 2005, and
December 31, 2004, and for the three-month periods ended March 31, 2005 and
2004.


                                       11
<PAGE>

Results of Operations for the Three Months Ended March 31, 2005

Net Interest Income

Total interest income for the three-month period ended March 31, 2005 was $2.6
million, an increase of $666,000 or 35% from the same period in 2004. Average
earning assets in the 2005 period increased by $49.3 million or 38% compared to
the 2004 period due to increases in average Federal funds sold of $14.5 million
or 250%, average available-for-sale securities of $21.8 million or 105%, and
average loans of $13.1 million or 13%.

The weighted average taxable-equivalent yield on total interest-earning assets
was 5.89% in the 2005 period compared to 5.95% in the 2004 period. The decrease
in average yield was attributable to Federal funds sold, which had a lower yield
than other earning asset categories, becoming a larger percentage of total
average earning assets in the 2005 period. The individual average yields for
Federal funds sold, available-for-sale investment securities, and loans
increased in the 2005 period due to increases in the Federal funds rate and
short and medium-term market interest rates compared to the 2004 period.

Total interest expense for the three-month period ended March 31, 2005 was
$547,000, an increase of $198,000 or 57% from the same period in 2004. Average
interest-bearing liabilities in the 2005 period increased by $23.9 million or
27% compared to the 2004 period due to increases in average interest-bearing
deposits of $9.8 million or 21%, average time deposits of $9.9 million or 29%,
and average long-term debt of $4.2 million or 82%.

The average rate paid on interest-bearing liabilities was 1.96% in the 2005
period compared to 1.59% in the 2004 period. The increase in rates paid was
attributable to increased market interest rates for deposits, increased
medium-term borrowings from the Federal Home Loan Bank and higher interest
payments on subordinated interest debentures related to trust preferred
securities.

Net interest income before provision for loan losses increased to $2.0 million
for the 2005 period from $1.56 million for the 2004 period due to the factors
described above. Increased volume of net average earning assets resulted in an
increase in the Company's net interest income of $338,000, while the increase in
interest rates increased net interest income by an additional $130,000.

The Company's net interest margin on a tax equivalent basis decreased 25 bps
(from 4.90% to 4.65%) in the 2005 period compared to the 2004 period. The
decrease in net interest margin was attributable to the increased cost of funds
in the 2005 period and to the change in the composition of total
interest-earning assets as described above.

The increased significance of noninterest-bearing deposits as a funding source
prevented the net interest margin from deteriorating further. Average
noninterest-bearing deposits totaled $59.3 million, representing 37% of average
deposits during the 2005 period, compared to average noninterest-bearing
deposits of $38.8 million, representing 32% of average deposits, during the 2004
period.


                                       12
<PAGE>

The following table presents the Company's average balance sheet, including
weighted average yields and rates on a taxable-equivalent basis, for the
three-month periods indicated:

             Average balances and weighted average yields and rates
             ------------------------------------------------------

<TABLE>
<CAPTION>
                                                                                    Quarters ended March 31,
                                                                ----------------------------------------------------------------
                                                                             2005                              2004
                                                                ------------------------------    ------------------------------
                                                                            Interest   Average                Interest   Average
                                                                Average     income/     yield/    Average     income/     Yield/
(dollars in thousands)                                          Balance     Expense     Cost      Balance     Expense     cost
                                                                --------    --------    -----     --------    --------    -----
<S>                                                             <C>         <C>          <C>      <C>         <C>          <C>
ASSETS
Due from banks                                                                                    $    166    $      2     4.85%
Federal funds sold                                              $ 20,357    $    124     2.47%       5,813          14      .97%
Available-for-sale investment securities:
       Taxable                                                    37,737         321     3.45%      18,540         161     3.49%
       Non-taxable (1)                                             4,795          43     5.51%       2,180          18     5.03%
                                                                --------    --------    -----     --------    --------    -----
    Total securities (1)                                          42,532         364     3.68%      20,720         179     3.65%
Loans (2) (3)                                                    116,276       2,092     7.30%     103,202       1,719     6.70%
                                                                --------    --------    -----     --------    --------    -----
    Total interest-earning assets (1)                            179,165       2,580     5.89%     129,901       1,914     5.95%
Noninterest-earning assets, net of allowance for loan losses      15,661                             9,937
                                                                --------                          --------
    Total assets                                                $194,826                          $139,838
                                                                ========                          ========

LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
  Interest bearing                                              $ 56,863    $    151     1.08%    $ 47,039    $     88      .75%
  Time deposits less than $100,000                                27,480         102     1.51%      17,684          81     1.84%
  Time deposits $100,000 or more                                  16,193         150     3.76%      16,053          89     2.23%
                                                                --------    --------    -----     --------    --------    -----
    Total interest-bearing deposits                              100,536         403     1.63%      80,776         258     1.28%
Long-term debt                                                     9,296          98     4.28%       5,205          57     4.44%
Junior subordinated deferrable interest debentures                 3,093          46     6.03%       3,093          33     4.33%
                                                                --------    --------    -----     --------    --------    -----
    Total interest-bearing liabilities                           112,925         547     1.96%      89,074         349     1.59%
                                                                            --------    -----                 --------    -----
Noninterest bearing deposits                                      59,313                            38,786
Other liabilities                                                  3,438                               711
                                                                --------                          --------
    Total liabilities                                            175,676                           128,571
Shareholders' equity                                              19,150                            11,267
                                                                --------                          --------
    Total liabilities and shareholders' equity                  $194,826                          $139,838
                                                                ========                          ========
Net interest income and margin (1)                                          $  2,033     4.65%                $  1,565     4.90%
                                                                            ========    =====                 ========    =====
</TABLE>

(1)   Interest income is not presented on a taxable-equivalent basis, however,
      the average yield was calculated on a taxable-equivalent basis by using a
      marginal tax rate of 34%.

(2)   Nonaccrual loans are included in total loans. Interest income is included
      on nonaccrual loans only to the extent cash payments have been received.
      No interest was received on nonaccrual loans for the periods presented.

(3)   Interest income includes amortized loan fees of $46 and $52 for 2005 and
      2004, respectively.


                                       13
<PAGE>

The following table sets forth a summary of the changes in interest income and
interest expense from changes in average earning assets and interest-bearing
liabilities (volume) and changes in average interest rates for the three-month
periods ended March 31, 2005 and 2004. Changes not solely attributable to volume
or rates have been allocated in proportion to the respective volume and rate
components.

       Changes in net interest income due to changes in volumes and rates
       ------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                         2005 period vs 2004 period
                                                    Increase (decrease) due to change in:
                                                      Average      Average
                                                      Volume        Rate (1)    Total
                                                      -------      ---------    ------
<S>                                                   <C>          <C>          <C>
(In thousands)
Increase (decrease) in interest income:
Due from banks                                        $   (2)      $    0       $   (2)
Federal funds sold                                        35           75          110
Available-for-sale investments securities                197          (12)         185
Loans                                                    216          157          373
                                                      ------       ------       ------
     Total interest income                               446          220          666

(Decrease) increase in interest expense:
Interest-bearing deposits                                 18           45           63
Time deposits less than $100,000                          44          (23)          21
Time deposits $100,000 or more                             1           60           61
Long-term debt                                            46           (5)          41
Junior subordinated deferrable interest debentures         0           13           13
                                                      ------       ------       ------
     Total interest expense                              108           90          198
                                                      ------       ------       ------
     Increase in net interest income                  $  338       $  130       $  468
                                                      ======       ======       ======

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

</TABLE>

Provision for Loan Losses

The provision for loan losses, which is included in operations to support the
required level of the allowance for loan losses, is based on loan growth, credit
experience, portfolio mix and management's ongoing evaluation of the loan
portfolio risk and economic conditions. For the three-month periods ended March
31, 2005 and 2004, the Company recorded provisions for loan losses of $31,000
and $35,000, respectively. The Company recorded no loan charge-offs or
recoveries during the 2005 period, compared to $8,000 of net loan recoveries
recorded during the 2004 period.


                                       14
<PAGE>

Non-Interest Income

Noninterest income for the three-month periods ended March 31, 2005 and 2004
totaled $227,000 and $214,000, respectively, an increase of $13,000 or 6%. The
components of noninterest income during each period were as follows:

                               Noninterest income
                               ------------------

<TABLE>
<CAPTION>
                                                  Quarter ended March 31,
                                                  -----------------------          Increase
(in thousands)                                     2005             2004          (Decrease)
                                                  ------           ------           ------
<S>                                               <C>              <C>              <C>
Service charges                                   $  124           $  117           $    7
Gain on sale of available-for-sale investment
securities                                             0                7               (7)
Mortgage loan brokerage fees                          39               38                1
Earnings on cash surrender value of life
insurance policies                                    26               19                7
Other                                                 38               33                5
                                                  ------           ------           ------
     Total noninterest income                     $  227           $  214           $   13
                                                  ======           ======           ======
</TABLE>

The increase in noninterest income was due to increased service charges
resulting from an increase in the number of deposit accounts, and to greater
earnings on cash surrender value of life insurance policies caused by rising
market interest rates.

Non-Interest Expense

Noninterest expense was $1.6 million in the first quarter of 2005 compared to
$1.3 million in the first quarter of 2004, an increase of $0.3 million or 24%.
The increase was due primarily to increased employee costs associated with the
Company's growth.

The following table describes the components of noninterest expense for the
three-month periods ended March 31, 2005 and 2004:

                               Noninterest expense
                               -------------------

                                         Quarter ended March 31,
                                         -----------------------       Increase
(in thousands)                             2005           2004        (Decrease)
                                         --------       --------       --------
Salaries and employee benefits           $    898       $    700       $    198
Occupancy and equipment                       175            147             28
Data processing                               103            104             (1)
Operations                                     99             90              9
Professional and legal                         72             57             15
Advertising and business
development                                    53             33             20
Telephone and postal                           37             33              4
Supplies                                       43             25             18
Assessment and insurance                       36             27              9
Amortization expense                           16             16              0
Other expenses                                 75             63             12
                                         --------       --------       --------
     Total noninterest expense           $  1,607       $  1,295       $    312
                                         ========       ========       ========


                                       15
<PAGE>

Provision for Income Taxes

The provisions for income taxes for the three-month periods ended March 31, 2005
and 2004 was $240,000 and $164,000, respectively. The effective tax rates for
these periods were 38.6%, and 36.6%, respectively.

Financial Condition

Investment Securities

All existing investment securities are classified as available-for-sale
securities. In classifying its investments as available-for-sale, securities are
reported at fair value, with unrealized gains and losses excluded from earnings
and reported, net of taxes, as accumulated other comprehensive income within
shareholders' equity.

The following tables set forth the estimated market value of available-for-sale
investment securities at the dates indicated:

                  Market value of securities available for sale
                  ---------------------------------------------

                                                March 31, 2005
                                  ---------------------------------------------
(in thousands)                    Amortized  Unrealized  Unrealized      Fair
                                    Cost        Gain        Loss         Value
                                    ----        ----        ----         -----
U.S. government  agencies         $ 26,443    $      0    $   (449)    $ 25,994
Mortgage-backed securities           4,903          40         (71)       4,872
Municipal securities                11,643           0        (214)      11,429
Corporate debt securities            4,596           1         (98)       4,499
                                  --------    --------    --------     --------
    Total                         $ 47,585    $     41    $   (832)    $ 46,794
                                  ========    ========    ========     ========

                                               December 31, 2004
                               ------------------------------------------------
(in thousands)                   Amortized   Unrealized  Unrealized    Fair
                                   Cost         Gain        Loss      Value
                                   ----         ----        ----      -----
U.S. government  agencies         $ 20,988    $      5    $   (118)    $ 20,875
Mortgage-backed securities           8,790          12         (48)       8,754
Municipal securities                 4,382          66         (31)       4,417
Corporate debt securities            4,067           4         (18)       4,053
                                  --------    --------    --------     --------
    Total                         $ 38,227    $     87    $   (215)    $ 38,099
                                  ========    ========    ========     ========

Loans

The Company's lending activities are geographically concentrated in the South
San Joaquin Valley, primarily in Tulare and Fresno counties. The following table
sets forth the breakdown of loans outstanding by type at the dates indicated by
amount and percentage of the portfolio:

(dollars in thousands)             March 31, 2005          December 31, 2004
                                --------------------      --------------------
Commercial                      $  34,646        29%      $  34,389        29%
Real estate - mortgage (1)         61,254        51          60,688        52
Real estate - construction         19,473        16          14,694        13
Agricultural                        3,406         3           4,535         4
Consumer and other                  2,021         1           2,388         2
                                ---------     -----       ---------     -----
    Subtotal                      120,800       100%        116,694       100%
                                              =====                     =====
Deferred loan fees, net              (518)                     (459)
Allowance for loan losses          (1,432)                   (1,401)
                                ---------                 ---------
    Total loans, net            $ 118,850                 $ 114,834
                                =========                 =========

(1)   Consists primarily of commercial mortgage loans.


                                       16
<PAGE>

Although the first quarter of 2005 saw real estate - construction loans increase
more rapidly that other loan portfolio segments, the primary focus of the
lending division is commercial loans, including commercial mortgage loans. This
is attributable to the rapidly growing commercial economy in the Company's
lending territory. Tulare and Fresno counties are two of the top counties in the
United States for agricultural production, but the Company lends in the
agricultural sector on a very selective basis due to the volatility of that
market and other factors. Retail loan products are offered primarily for the
benefit of commercial business owners and professionals who typically maintain
depository and other lending relationships with the Company.

Nonperforming Assets. Nonperforming assets at March 31, 2005 and December 31,
2004 were $41,000 and $81,000, respectively, and were comprised entirely of
nonaccrual loans.

Allowance for Loan Losses

The allowance for loan losses totaled $1.43 million or 1.2% of total loans at
March 31, 2005. This compared to $1.48 million or 1.4% of total loans at March
31, 2004 and $1.40 million or 1.2% at December 31, 2004. The decrease in the
allowance percentage from March 31, 2004 reflected a significant loan charge-off
recorded in the second quarter of 2004. The charge-off had been anticipated by
management which had allocated a portion of the total allowance to the specific
loan. In its periodic analysis of the allowance for loan losses, management
believes that the allowance for loan losses is adequate at 1.2% of total loans
at both December 31, 2004 and March 31, 2005. However, no assurance can be given
that the Company may not sustain charge-offs which are in excess of the
allowance in any given period.

The following table summarizes the changes in the allowance for loan losses for
the periods indicated:

                      Changes in allowance for loan losses
                      ------------------------------------

                                                      Quarter ended March 31,
(dollars in thousands)                                 2005             2004
                                                       ----             ----

Balance, beginning                                  $   1,401        $   1,393
Provision for loan losses                                  31               35
Charge-offs                                                 0                0
Recoveries                                                  0                8
                                                    ---------        ---------
Balance, ending                                     $   1,432        $   1,436
                                                    =========        =========

Net charge-offs (recoveries) to average loans
  outstanding                                              0%           (0.01)%
Average loans outstanding                           $ 116,743        $ 103,582
Ending allowance to total loans outstanding              1.19%            1.37%

Deposits

Total deposits were $159.2 million as of March 31, 2005, an increase of $2.8
million or 2% (not annualized) from the December 31, 2004 balance of $156.4
million. The relatively low rate of deposit growth in the first quarter of 2005
followed exceptionally high growth in the fourth quarter of 2004 during which
total deposits increased by $20.0 million or 14%. Total deposits at March 31,
2005 consisted of 34% noninterest-bearing deposits, 38% interest-bearing
deposits, and 28% time deposits. The December 31, 2004 deposit mix consisted of
37% noninterest bearing deposits, 35% interest-bearing deposits, and 28% time
deposits. The percentage of noninterest bearing accounts at March 31, 2005,
while still favorable, decreased from December 31, 2004 due to customer usage of
cash funds or redeployment into interest-bearing accounts during the first
quarter of 2005.

Borrowings

At March 31, 2005 and December 31, 2004, long-term debt outstanding from the
Federal Home Loan Bank remained unchanged at $9.3 million as no new debt was
incurred. The balance of Junior Subordinated Deferrable Interest Debentures at
March 31, 2005 also remained unchanged from December 31, 2004 at $3.1 million.
During the first quarter of 2005, the Company did not utilize its short-term
unsecured borrowing arrangements with correspondent banks.


                                       17
<PAGE>

Capital Resources

At March 31, 2005 and December 31, 2004, all of the Company's capital ratios
were in excess of minimum regulatory requirements, and Bank of Visalia exceeded
the minimum requirements of a "well capitalized" institution.

On September 9, 2004, the Company filed a registration statement with the
Securities and Exchange Commission (SEC) for the public sale of 650,000 shares
of common stock. The SEC declared the registration statement effective on
December 23, 2004. On December 29, 2004, the Company sold 350,750 shares of
common stock to the Company's underwriter, Wedbush Morgan Securities; the
remaining 299,250 shares were sold directly by the Company in January 2005. The
entire stock offering added $7.6 million to the Company's capital. The balance
of stockholders' equity increased from $16.3 million at December 31, 2004 to
$20.2 million at March 31, 2005. The increase primarily reflected the proceeds
from January 2005 sale of common stock.

In the second quarter of 2003, Valley Commerce Trust I issued $3.0 million of
trust preferred securities. Trust preferred securities are includable in Tier 1
capital, subject to regulatory limitation. At March 31, 2005, and March 31,
2004, the entire $3.0 million was included in Tier 1 capital.

The Company declared a three-for-two stock split in August 2004 and paid 5%
stock dividends in 2004 and 2003. The Company has not declared or paid cash
dividends since inception. Stock splits and dividends are not dilutive to
capital ratios.


                                       18
<PAGE>

The following table summarizes the Company's risk-based capital ratios as of
March 31, 2005 and December 31, 2004:

                       Capital and capital adequacy ratios
                       -----------------------------------

                                                    Quarter ended
                                                    -------------
                                         March 31, 2005        December 31, 2004
                                         --------------        -----------------
(dollars in thousands)                 Amount      Ratio       Amount      Ratio
                                       ------      -----       ------      -----
Leverage Ratio
--------------
Valley Commerce Bancorp
  and Subsidiary                      $ 23,493     12.1%      $ 19,216     10.8%
Minimum regulatory requirement        $  9,397      4.0%      $  7,686      4.0%

Bank of Visalia                       $ 22,866     11.7%      $ 14,910      8.4%
Minimum requirement for "Well-
  Capitalized" institution            $ 11,433      5.0%      $  7,455      5.0%
Minimum regulatory requirement        $  9,147      4.0%      $  5,964      4.0%

Tier 1 Risk-Based Capital Ratio
-------------------------------
Valley Commerce Bancorp
  and Subsidiary                      $ 23,493     17.6%      $ 19,216     14.7%
Minimum regulatory requirement        $  5,356      4.0%      $  5,227      4.0%

Bank of Visalia                       $ 22,866     17.1%      $ 14,910     11.4%
Minimum requirement for "Well-
  Capitalized" institution            $  8,024      6.0%      $  7,825      6.0%
Minimum regulatory requirement        $  5,349      4.0%      $  5,217      4.0%

Total Risk-Based Capital Ratio
------------------------------
Valley Commerce Bancorp
  and Subsidiary                      $ 24,924     18.6%      $ 20,617     15.8%
Minimum regulatory requirement        $ 10,712      8.0%      $ 10,455      8.0%

Bank of Visalia                       $ 24,298     18.2%      $ 16,311     12.5%
Minimum requirement for "Well-
  Capitalized" institution            $ 13,373     10.0%      $ 13,042     10.0%
Minimum regulatory requirement        $ 10,698      8.0%      $ 10,434      8.0%

Liquidity

Liquidity is the ability to provide funds to meet customers' loan and cash
needs and to fund operations in a timely and cost effective manner. The
Company's primary source of funds is deposits. On an ongoing basis, management
anticipates funding needs for loans, asset purchases, maturing deposits, and
other needs and initiates deposit promotions as needed. During periods when
deposit growth exceeds customer needs, funds are invested in investment
securities to serve as a future source of funding.

The Company's available-for-sale securities portfolio, Federal funds sold, and
cash and due from banks serve as the primary sources of liquidity. Secondary
sources of liquidity include short-term borrowing arrangements with the Federal
Home Loan Bank and correspondent banks.

The Company's off-balance sheet financing arrangements are primarily limited to
commitments to extend credit and standby letters of credit, which totaled $30.2
million and $1.6 million, respectively, at March 31, 2005. Management monitors
these arrangements each accounting period in the overall assessment of the
Company's liquidity needs. The Company has no other off-balance sheet
arrangements that are likely to have a material effect on its financial
condition, results of operations, liquidity, capital expenditures or capital
resources. The Company does not retain a repurchase option or contingent
interest in any of its loan participations.


                                       19
<PAGE>

The Company's strategic objectives include expanding through opening of "de
novo" branches and loan production offices in the near term and acquiring branch
offices from other institutions in the longer term. The addition of branch
offices is expected to involve significant cash outlays; e.g., for buildings,
improvements, and equipment. The Company's planning efforts consider the impact
of such cash outlays so that sufficient liquidity is maintained for both capital
and operational needs.

ITEM 3 - CONTROLS AND PROCEDURES

(a) EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

Based on their evaluation as of the end of the period covered by this Quarterly
Report on Form 10-QSB, the Company's principal executive officer and principal
financial officer have concluded that the Company's disclosure controls and
procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities
Exchange Act of 1934 (the "Exchange Act")) are effective to ensure that
information required to be disclosed by the Company in reports that it files or
submits under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in Securities and Exchange Commission rules
and forms.

(b) CHANGES IN INTERNAL CONTROLS

There were no changes in the Company's internal control over financial reporting
identified in connection with the evaluation described in paragraph (a) above
that occurred during the Company's last fiscal quarter that has materially
affected, or is reasonably likely to materially affect, the Company's internal
control over financial reporting.


                                       20
<PAGE>

                           PART II - OTHER INFORMATION

ITEM 1 - LEGAL PROCEEDINGS

From time to time, the Company is a party to claims and legal proceedings
arising in the ordinary course of business. In the opinion of the Company's
management, the amount of ultimate liability with respect to such proceedings
will not have a material adverse effect on the financial condition or results of
operations of the Company.

ITEM 2 - UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

(a)   There were no options granted or exercised during the first quarter of
      2005.

(b)   The following information is furnished with respect to the use of proceeds
      received from the Company's public offering that closed in December 2004
      and January 2005:

      Gross proceeds to the company                              $ 8,450,000

      Offering expenses:
            Underwriting discount               $   227,988
            Other offering expenses                 592,314
                                                -----------
            Total offering expenses                                  820,302
                                                                 -----------

      Net proceeds to the company                                $ 7,629,698
                                                                 ===========

      As of the date of this report, the Company used the net proceeds of the
      offering to fund working capital and other general corporate purposes.
      Over time, the additional capital will be used to expand the operations of
      Bank of Visalia, the Company's wholly-owned subsidiary.

(c)   The Company did not repurchase any stock during the first quarter of 2005.

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

An Exhibit Index has been attached as part of this quarterly report and is
incorporated herein by reference.


                                       21
<PAGE>

                                   SIGNATURES

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

                                    VALLEY COMMERCE BANCORP


Date: May 13, 2005                  By: /s/ Donald A. Gilles
                                        ----------------------------------------
                                        Donald A. Gilles
                                        President and Chief Executive Officer


Date: May 13, 2005                  By: /s/Roy O. Estridge
                                        ----------------------------------------
                                        Roy O. Estridge, Chief Financial Officer


                                       22
<PAGE>

                                  Exhibit Index

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


                                       23