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

                                    FORM 10-Q


[X]   QUARTERLY  REPORT  PURSUANT  TO SECTION  13 OR 15(D) OF THE  SECURITIES
      EXCHANGE ACT OF 1934

                 FOR THE QUARTERLY PERIOD ENDED: MARCH 31, 2006

                                    OR

[  ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
      EXCHANGE ACT OF 1934

             FOR THE TRANSITION PERIOD FROM _________ TO _________


                                    000-50914
                            ________________________
                            (Commission File Number)


                             BRIDGE CAPITAL HOLDINGS
             ______________________________________________________
             (Exact name of registrant as specified in its charter)


             CALIFORNIA                               80-0123855
   _______________________________      _______________________________________
   (State or other jurisdiction of      (I.R.S. Employer Identification Number)
   incorporation or organization)


                    55 ALMADEN BOULEVARD, SAN JOSE, CA 95113
          ____________________________________________________________
          (Address of principal executive offices, including zip code)


Registrant's telephone number, including area code:  (408) 423-8500
                                                     ______________


Bridge Bank,  N.A. (1) has filed all reports  required to be filed by section 13
or 15(d) of the  Securities  Exchange Act of 1934 during the preceding 12 months
and (2) has been subject to such filing requirements for the past 90 days.
Yes X  No    .
   ___   ___

Indicate by  checkmark  whether  registrant  is a large  accelerated  filer,  an
accelerated  filer, or a  non-accelerated  filer. See definition of "accelerated
file and large  accelerated  filer" in Rule 12b-2 of the  Exchange  Act.  (Check
one):

Large accelerated filer [ ]   Accelerated filer [X]   Non-accelerated filer [ ]

Indicate by checkmark  whether the  registrant is a shell company (as defined in
Rule  12b-2 of the  Act).  Yes [ ] No [X]

The number of shares of Common Stock outstanding as of April 18, 2006: 6,256,721


                                       1

<PAGE>

                                TABLE OF CONTENTS

PART 1 - FINANCIAL INFORMATION                                                3
______________________________

ITEM 1.       INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)           4

              INTERIM CONSOLIDATED BALANCE SHEETS                             4

              INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS                   5

              INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS                   6

              NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)  7

ITEM 2.       MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION    14
              AND RESULTS OF OPERATIONS

ITEM 3.       QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK     29

ITEM 4.       CONTROLS AND PROCEDURES                                        31

PART II - OTHER INFORMATION
___________________________

ITEM 1.       LEGAL PROCEEDINGS                                              32

ITEM 2.       UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS    32

ITEM 3.       DEFAULTS UPON SENIOR SECURITIES                                32

ITEM 4.       SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS            32

ITEM 5.       OTHER INFORMATION                                              32

ITEM 6.       EXHIBITS                                                       32

INDEX TO EXHIBITS                                                            33


                                       2

<PAGE>



                           FORWARD-LOOKING STATEMENTS

IN  ADDITION TO THE  HISTORICAL  INFORMATION,  THIS  QUARTERLY  REPORT  CONTAINS
CERTAIN  FORWARD-LOOKING  INFORMATION  WITHIN THE  MEANING OF SECTION 27A OF THE
SECURITIES ACT OF 1933, AS AMENDED,  AND SECTION 21E OF THE SECURITIES  EXCHANGE
ACT OF 1934, AS AMENDED,  AND WHICH ARE SUBJECT TO THE "SAFE HARBOR"  CREATED BY
THOSE SECTIONS.  THE READER OF THIS QUARTERLY REPORT SHOULD  UNDERSTAND THAT ALL
SUCH FORWARD-LOOKING  STATEMENTS ARE SUBJECT TO VARIOUS  UNCERTAINTIES AND RISKS
THAT COULD AFFECT THEIR  OUTCOME.  THE  COMPANY'S  ACTUAL  RESULTS  COULD DIFFER
MATERIALLY FROM THOSE SUGGESTED BY SUCH FORWARD-LOOKING  STATEMENTS.  SUCH RISKS
AND UNCERTAINTIES INCLUDE, AMONG OTHERS, (1) COMPETITIVE PRESSURE IN THE BANKING
INDUSTRY INCREASES  SIGNIFICANTLY;  (2) CHANGES IN THE INTEREST RATE ENVIRONMENT
REDUCES  MARGINS;  (3)  GENERAL  ECONOMIC   CONDITIONS,   EITHER  NATIONALLY  OR
REGIONALLY, ARE LESS FAVORABLE THAN EXPECTED,  RESULTING IN, AMONG OTHER THINGS,
A DETERIORATION  IN CREDIT QUALITY;  (4) CHANGES IN THE REGULATORY  ENVIRONMENT;
(5) CHANGES IN BUSINESS  CONDITIONS  AND  INFLATION;  (6) COSTS AND  EXPENSES OF
COMPLYING WITH THE INTERNAL CONTROL PROVISIONS OF THE SARBANES-OXLEY ACT AND OUR
DEGREE OF SUCCESS IN ACHIEVING  COMPLIANCE;  (7) CHANGES IN SECURITIES  MARKETS,
(8) FUTURE CREDIT LOSS EXPERIENCE;  (9) CIVIL  DISTURBANCES OR TERRORIST THREATS
OR ACTS, OR APPREHENSION  ABOUT POSSIBLE FUTURE OCCURANCES OF ACTS OF THIS TYPE;
AND (10) THE  INVOLVEMENT  OF THE  UNITED  STATES  IN WAR OR OTHER  HOSTILITIES.
THEREFORE,  THE  INFORMATION  IN  THIS  QUARTERLY  REPORT  SHOULD  BE  CAREFULLY
CONSIDERED WHEN EVALUATING THE BUSINESS PROSPECTS OF THE COMPANY.

FORWARD-LOOKING  STATEMENTS ARE GENERALLY  IDENTIFIABLE BY THE USE OF TERMS SUCH
AS "BELIEVE", "EXPECT", "INTEND", "ANTICIPATE", "ESTIMATE", "PROJECT", "ASSUME,"
"PLAN," "PREDICT," "FORECAST," "IN MANAGEMENT'S OPINION," "MANAGEMENT CONSIDERS"
OR SIMILAR  EXPRESSIONS.  WHEREVER SUCH PHRASES ARE USED, SUCH STATEMENTS ARE AS
OF AND BASED UPON THE KNOWLEDGE OF MANAGEMENT,  AT THE TIME MADE AND ARE SUBJECT
TO CHANGE BY THE PASSAGE OF TIME AND/OR SUBSEQUENT  EVENTS, AND ACCORDINGLY SUCH
STATEMENTS  ARE  SUBJECT TO THE SAME RISKS AND  UNCERTAINTIES  NOTED  ABOVE WITH
RESPECT TO FORWARD-LOOKING STATEMENTS.

ALL OF THE  COMPANY'S  OPERATIONS  AND  MOST OF ITS  CUSTOMERS  ARE  LOCATED  IN
CALIFORNIA.  OTHER EVENTS, INCLUDING THOSE OF SEPTEMBER 11, 2001, HAVE INCREASED
THE  UNCERTAINTY  RELATED TO THE NATIONAL AND  CALIFORNIA  ECONOMIC  OUTLOOK AND
COULD HAVE AN EFFECT ON THE FUTURE  OPERATIONS OF THE COMPANY OR ITS  CUSTOMERS,
INCLUDING BORROWERS.  THE COMPANY DOES NOT UNDERTAKE, AND SPECIFICALLY DISCLAIMS
ANY OBLIGATION, TO UPDATE ANY FORWARD-LOOKING  STATEMENTS TO REFLECT OCCURRENCES
OR UNANTICIPATED EVENTS OR CIRCUMSTANCES AFTER THE DATE OF SUCH STATEMENTS.

THE READER  SHOULD REFER TO THE MORE  COMPLETE  DISCUSSION  OF SUCH RISKS IN THE
COMPANY'S ANNUAL REPORTS ON FORM 10-K.

                                       3

<PAGE>



                         PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS

<TABLE>
<CAPTION>

         BRIDGE CAPITAL HOLDINGS AND SUBSIDIARY
           INTERIM CONSOLIDATED BALANCE SHEETS (unaudited)
                 (dollars in thousands)
                                                          March 31,   December 31,
                                                             2006         2005
                                                         __________________________
<S>                                                          <C>           <C>
ASSETS
CASH AND DUE FROM BANKS                                      $ 17,879      $ 22,880
FEDERAL FUNDS SOLD                                             62,235        46,660
                                                         __________________________
  Total cash and equivalents                                   80,114        69,540
                                                         __________________________

INVESTMENT IN SUBSIDIARY-TRUST                                    527             -
INVESTMENT SECURITIES AVAILABLE FOR SALE                       14,229        12,383
LOANS, net of allowance for credit losses of $6,169 at
March 31, 2006 and $5,936 at December 31, 2005                449,519       432,667

PREMISES AND EQUIPMENT, net                                     2,538         2,337
ACCRUED INTEREST RECEIVABLE                                     2,587         2,202
OTHER ASSETS                                                   17,420        17,391

                                                         __________________________
   TOTAL                                                    $ 566,934     $ 536,520
                                                         ===========================

LIABILITIES AND SHAREHOLDERS' EQUITY
DEPOSITS:
  Demand noninterest-bearing                                $ 188,827     $ 185,557
  Demand interest-bearing                                       2,993         2,866
  Savings                                                     210,663       210,011
  Time                                                         89,885        69,724
                                                         __________________________
     Total deposits                                           492,368       468,158
                                                         __________________________

JUNIOR SUBORDINATED DEBT SECURITIES                            17,527        12,372
OTHER BORROWINGS                                               10,000        10,000
ACCRUED INTEREST PAYABLE                                          155           130
OTHER LIABILITIES                                               4,903         6,146
                                                         __________________________
     Total liabilities                                        524,953       496,806
                                                         __________________________

COMMITMENTS AND CONTINGENCIES                                       -             -

SHAREHOLDERS' EQUITY
  Preferred stock, no par value; 10,000,000 shares
    authorized; none issued
  Common stock, no par value; 30,000,000 shares authorized;
     6,256,721 shares issued and outstanding at March 31,
     2006.
     6,227,596 shares issued and outstanding at December
     31, 2006                                                  34,227        33,907
  Retained earnings                                             7,839         5,909
  Accumulated other comprehensive (loss)                          (85)         (102)
                                                         __________________________
     Total shareholders' equity                                41,981        39,714
                                                         __________________________
     TOTAL                                                  $ 566,934     $ 536,520
                                                         ===========================
</TABLE>

The accompanying notes are an integral part of the financial statements.

                                       4
<PAGE>


          BRIDGE CAPITAL HOLDINGS AND SUBSIDIARY
          INTERIM CONSOLIDATED STATEMENTS OF INCOME (unaudited)
     (dollars in thousands, except per share amounts)

                                                   Three months ended
                                                         March 31,
                                                  2006            2005
                                               ___________     ___________
INTEREST INCOME:
  Loans                                           $ 10,252         $ 6,270
  Federal funds sold                                   578             221
  Investment securities available for sale              98             124
                                               ___________     ___________
    Total interest income                           10,928           6,615
                                               ___________     ___________

INTEREST EXPENSE:
  Deposits:
    Interest-bearing demand                              7               5
    Money market and savings                         1,427             661
    Certificates of deposit                            665             314
    Other                                              287             208
                                               ___________     ___________
    Total interest expense                           2,386           1,188
                                               ___________     ___________

Net interest income                                  8,542           5,427
  Provision for credit losses                          222             333
                                               ___________     ___________
NET INTEREST INCOME AFTER
  PROVISION FOR CREDIT LOSSES                        8,320           5,094
                                               ___________     ___________

OTHER INCOME:
  Service charges on deposit accounts                  112              68
  Gain on sale of SBA loans                            451             420
  Other non interest income                            520             296
                                               ___________     ___________
     Total other income                              1,083             784
                                               ___________     ___________

OTHER EXPENSES:
  Salaries and benefits                              3,919           2,552
  Premises and fixed assets                            614             550
  Other                                              1,805           1,213
                                               ___________     ___________
     Total other expenses                            6,338           4,315
                                               ___________     ___________

INCOME BEFORE INCOME TAXES                           3,065           1,563
                                               ___________     ___________
Income taxes                                         1,134             606
                                               ___________     ___________
NET INCOME                                         $ 1,931           $ 957
                                               ============    ============

Basic earnings per share                            $ 0.31          $ 0.16
                                               ============    ============
Diluted earnings per share                          $ 0.29          $ 0.14
                                               ============    ============
Average common shares outstanding                6,240,495       6,127,474
                                               ============    ============
Average common and equivalent shares
 outstanding                                     6,784,758       6,687,860
                                               ============    ============

The accompanying notes are an integral part of the financial statements.


                                       5

<PAGE>

            BRIDGE CAPITAL HOLDINGS AND SUBSIDIARY
          INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
             (dollars in thousands)
                                                  Three months ended March 31,
                                                      2006           2005
                                                  _____________  ______________
CASH FLOWS FROM OPERATING ACTIVITIES:

  Net income                                           $ 1,931           $ 957
  Adjustments to reconcile net income to net cash
    provided by operating activities:
      Provision for credit losses                          222             333
      Depreciation and amortization                        209             219
      Stock based compensation                             150               -
      Proceeds from loan sales                         (69,843)
      Loans originated for sale                         66,578
        Increase in accrued interest receivable
          and other assets                                (432)           (253)
        Increase in accrued interest payable and
          other liabilities                             (1,592)              2
                                                  _____________  ______________
          Net cash (used in) provided by operating
            activities                                  (2,777)          1,258
                                                  _____________  ______________

CASH FLOWS FROM INVESTING ACTIVITIES:

  Proceeds from maturity of securities available
    for sale                                             3,275           6,100
  Purchase of securities available for sale             (5,080)           (197)
  Net increase in loans                                (13,809)        (29,011)
  Purchase of life insurance                                 -             (60)
  Purchase of fixed assets                                (415)           (331)
                                                  _____________  ______________
          Net cash used in investing activities        (16,029)        (23,499)
                                                  _____________  ______________

CASH FLOW FROM FINANCING ACTIVITIES:

  Net increase in deposits                              24,211          45,291
  Net increase in other borrowings                       5,000               -
  Common stock issued                                      169             250
                                                  _____________  ______________
Net cash provided by financing activities               29,380          45,541
                                                  _____________  ______________

NET INCREASE IN CASH AND EQUIVALENTS:                   10,574          23,300
Cash and equivalents at beginning of period             69,540          69,210
                                                  _____________  ______________
Cash and equivalents at end of period                 $ 80,114        $ 92,510
                                                  =============  ==============

OTHER CASH FLOW INFORMATION:
  Cash paid for interest                               $ 2,149           $ 964
                                                  =============  ==============
  Cash paid for income taxes                           $ 1,720           $ 430
                                                  =============  ==============

The accompanying notes are an integral part of the financial statements.

                                       6


<PAGE>


                             BRIDGE CAPITAL HOLDINGS
                          NOTES TO FINANCIAL STATEMENTS

1.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION.

The accompanying  unaudited financial  statements of Bridge Capital Holdings and
Bridge Bank,  N.A.  have been  prepared in accordance  with  generally  accepted
accounting  principles and pursuant to the rules and regulations of the SEC. The
interim financial data as of March 31, 2006 and for the three months ended March
31, 2006 is unaudited;  however, in the opinion of the Company, the interim data
includes  all  adjustments,  consisting  only of normal  recurring  adjustments,
necessary for a fair statement of the results for the interim  periods.  Certain
information  and  note  disclosures   normally   included  in  annual  financial
statements have been omitted pursuant to SEC rules and regulations; however, the
Company   believes  the  disclosures  made  are  adequate  to  ensure  that  the
information  presented is not misleading.  Results of operations for the quarter
ended March 31, 2006, are not necessarily indicative of full year results.

The  comparative  balance sheet  information  as of December 31, 2005 is derived
from the audited financial statements.

USE OF ESTIMATES.

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect  reported  amounts of assets,  liabilities,  revenues and  expenses,  and
disclosure  of  contingent  assets and  liabilities  as of the dates and for the
periods presented. A significant estimate included in the accompanying financial
statements is the allowance  for loan losses.  Actual  results could differ from
those estimates.

EARNINGS PER SHARE.

Basic net income per share is  computed  by dividing  net income  applicable  to
common  shareholders by the weighted average number of common shares outstanding
during the period. Diluted net income per share is determined using the weighted
average number of common shares outstanding during the period,  adjusted for the
dilutive effect of common stock equivalents,  consisting of shares that might be
issued upon  exercise of common  stock  options.  Common stock  equivalents  are
included  in the diluted net income per share  calculation  to the extent  these
shares are  dilutive.  See Note 2 to the  financial  statements  for  additional
information on earnings per share.

STOCK-BASED COMPENSATION.

On January 1, 2006,  the Company  adopted SFAS No. 123 (revised  2004) (SFAS No.
123R),  Share-Based  Payment , which  addresses the accounting  for  stock-based
payment  transactions  in which an  enterprise  receives  employee  services  in
exchange for (a) equity  instruments of the enterprise or (b)  liabilities  that
are based on the fair value of the enterprise's  equity  instruments or that may
be settled by the  issuance of such equity  instruments.  In January  2005,  the
Securities and Exchange  Commission (SEC) issued Staff Accounting Bulletin (SAB)
No. 107, which provides supplemental  implementation guidance for SFAS No. 123R.
SFAS No. 123R  eliminates  the ability to account for  stock-based  compensation
transactions using the intrinsic value method under Accounting  Principles Board
(APB)  Opinion No. 25,  Accounting  for Stock  Issued to Employees , and instead
generally   require   that  such   transactions   be   accounted   for  using  a
fair-value-based  method.  The  Company  uses the  Black-Scholes-Merton  ("BSM")
option-pricing  model to determine the  fair-value of  stock-based  awards under
SFAS No. 123R,  consistent with that used for pro forma  disclosures  under SFAS
No. 123,  Accounting for Stock-Based  Compensation . The Company has elected the
modified  prospective  transition  method  as  permitted  by SFAS  No.  123R and
accordingly  prior  periods have not been restated to reflect the impact of SFAS

                                       7

<PAGE>

No. 123R. The modified  prospective  transition method requires that stock-based
compensation  expense  be  recorded  for  all new and  unvested  stock  options,
restricted  stock,  restricted  stock units,  and employee  stock  purchase plan
shares that are ultimately expected to vest as the requisite service is rendered
beginning on January 1, 2006,  the first day of the Company's  fiscal year 2006.
Stock-based  compensation expense for awards granted prior to January 1, 2006 is
based on the grant date fair-value as determined  under the pro forma provisions
of SFAS No. 123. The Company has recorded an incremental $150,000 of stock-based
compensation  expense  during  the  first  quarter  of 2006 as a  result  of the
adoption of SFAS No. 123R.

No  stock-based  compensation  costs were  capitalized as part of the cost of an
asset as of March  31,  2006.  As of  March  31,  2006,  $1.6  million  of total
unrecognized  compensation  cost related to stock options and  restricted  stock
units are expected to be recognized over a weighted-average period of 5 years.

Prior to the  adoption  of SFAS No.  123R,  the  Company  measured  compensation
expense for its  employee  stock-based  compensation  plans using the  intrinsic
value  method  prescribed  by APB  Opinion  No.  25.  The  Company  applied  the
disclosure provisions of SFAS No. 123 as amended by SFAS No. 148, Accounting for
Stock-Based Compensation -- Transition and Disclosure as if the fair-value-based
method had been applied in measuring compensation expense. Under APB Opinion No.
25, when the exercise price of the Company's employee stock options was equal to
the  market  price  of the  underlying  stock  on the  date  of  the  grant,  no
compensation expense was recognized.

The  following  table  illustrates  the effect on net income after taxes and net
income per common share as if the Company had applied the fair value recognition
provisions of SFAS No. 123 to stock-based  compensation  during the  three-month
period ended March 31, 2005 (in thousands, except per share amounts):

                                                Quarter ended
                                                   March 31,
                                                    2005
                                               _____________

Net income as reported                          $ 957,000
Deduct: Total stock-based
  employee compensation expense determined
  under fair value based method of all awards,
  net of related tax effects                    $ (116,000)
Pro forma net income                            $ 841,000

Earnings per share:
  Basic-as reported                             $ 0.16
  Basic-pro forma                               $ 0.14

  Diluted-as reported                           $ 0.14
  Diluted-pro forma                             $ 0.13


COMPREHENSIVE INCOME.

         SFAS No. 130, "Reporting  Comprehensive Income" requires that all items
recognized under accounting standards as components of comprehensive earnings be
reported  in an  annual  financial  statement  that is  displayed  with the same
prominence as other annual  financial  statements.  This Statement also requires
that an entity classify items of other comprehensive earnings by their nature in
an annual financial statement.  Other comprehensive  earnings include unrealized
gains  and  losses,  net  of  tax,  on  marketable   securities   classified  as
available-for-sale. The Company had cumulative other comprehensive income (loss)
totaling  $(85,000),  net of tax,  for the  period  ended  March  31,  2006  and
$(173,000), net of tax, for the period ended March 31, 2005.

                                       8

<PAGE>

 (dollars in thousands)                 Quarter ended March 31,
                                           2006        2005
                                        ___________ ____________

Net income                                    1,931        $ 957

Other comprehensive earnings-
 Change in net unrealized (losses)
 gains on securities available for sale          36          (97)
                                        ___________ ____________

Total comprehensive income                  $ 1,967        $ 860
                                        =========== ============

SEGMENT INFORMATION.

         SFAS No. 131,  "Disclosure  about Segments of an Enterprise and Related
Information,  requires certain  information about the operating  segments of the
Company. The objective of requiring  disclosures about segments of an enterprise
and related  information is to provide  information about the different types of
business  activities in which an enterprise  engages and the different  economic
environment  in which it operates to help users of financial  statements  better
understand  its  performance,  better assess its prospects for future cash flows
and make more informed  judgments  about the enterprise as a whole.  The Company
has  determined  that  it has  one  segment,  general  commercial  banking,  and
therefore, it is appropriate to aggregate the Company's operations into a single
operating segment.

2.       EARNINGS PER SHARE

Basic net earnings per share is computed by dividing net earnings  applicable to
common  shareholders by the weighted average number of common shares outstanding
during the  period.  Diluted  net  earnings  per share is  determined  using the
weighted average number of common shares outstanding during the period, adjusted
for the dilutive effect of common stock  equivalents,  consisting of shares that
might be issued upon exercise of common stock options.  Common stock equivalents
are  included in the diluted net earnings  per share  calculation  to the extent
these shares are dilutive.  A  reconciliation  of the numerator and  denominator
used in the calculation of basic and diluted net earnings per share available to
common shareholders is as follows (in thousands, except for per share amounts):

Earnings per share calculation

                                               Quarter ended March 31,
                                                  2006           2005
                                              ___________________________
Net income                                     $ 1,931,000     $ 957,000
                                              ___________________________

Weighted average shares used in computing:
    Basic earnings per share                     6,240,495     6,127,474
    Dilutive potential common shares related
    to stock options, using the treasury stock
    method                                         544,263       560,386
                                              ___________________________
Total average shares and equivalents             6,784,758     6,687,860

Basic earnings per share                            $ 0.31        $ 0.16
                                              ===========================
Diluted earnings per share                          $ 0.29        $ 0.14
                                              ===========================


All options are dilutive.

                                       9

<PAGE>

3.       SECURITIES


The amortized cost and  approximate  fair values of securities at March 31, 2006
and December 31, 2005 are as follows:


(dollars in thousands)                as of March 31, 2006
                                 ______________________________
                                         Gross Unrealized
                                         ________________
                                                        Fair
                                  Cost   Gains  Losses  Value
                                 ______________________________
  U. S. Government Treasuries      $ 198    $ -    $ -    $ 198
  U. S. Government Agencies       14,166      -   (135)  14,031
                                 ______________________________
Total available for sale          14,364      -   (135)  14,229
                                 ______________________________
  Total investment securities
    portfolio                    $14,364    $ -  $(135) $14,229
                                 ===============================

(dollars in thousands)              as of December 31, 2005
                                 ______________________________
                                         Gross Unrealized
                                         ________________
                                                        Fair
                                  Cost   Gains  Losses  Value
                                 ______________________________
  U. S. Government Treasuries      $ 199    $ -    $ -    $ 199
  U. S. Government Agencies       12,355      -   (171)  12,184
                                 ______________________________
Total available for sale          12,554      -   (171)  12,383
                                 ______________________________
  Total investment securities
    portfolio                    $12,554    $ -  $(171) $12,383
                                 ===============================


                                       10

<PAGE>



The scheduled maturities of securities available for sale at March 31, 2006 were
as follows:

(dollars in thousands)                 March 31, 2006
                                     ____________________
                                       Amortized   Fair
  Securities available for sale          Cost      Value
_________________________________________________________
Due in one year or less                $ 9,313   $ 9,250
Due after one year through five years    5,051     4,979
Due after five years through ten
  years                                      -         -
Due after ten years                          -         -
                                     ____________________
  Total securities available for sale   14,364    14,229
                                     ____________________
    Total Investment securities        $14,364   $14,229
                                     ====================

                                      December 31, 2005
                                     ____________________
                                       Amortized   Fair
  Securities available for sale          Cost      Value
_________________________________________________________
Due in one year or less                $10,536   $10,429
Due after one year through five years    2,018     1,954
Due after five years through ten years       -         -
Due after ten years                          -         -
                                     ____________________
  Total securities available for sale   12,554    12,383
                                     ____________________
    Total Investment securities        $12,554   $12,383
                                     ====================


As  of  March  31,  2006,   investment   securities   with  carrying  values  of
approximately  $198,000  were  pledged  as  collateral.  As of March  31,  2006,
$125,000 in unrealized losses was attributable to securities  positioned for the
period  greater than 12 months.  The  unrealized  losses on  investments in U.S.
Government  agency securities which have been in an unrealized loss position for
one year or longer as of March 31, 2006 (a total of 7  securities),  were caused
by market interest rate increases  subsequent to the purchase of the securities.
Because the Bank has the ability to hold these  investments  until a recovery in
fair value,  which may be maturity,  the unrealized  losses on these investments
are not considered to be other-than-temporarily impaired as of March 31, 2006.


                                       11


<PAGE>

4.       LOANS


The balances in the various loan  categories are as follows as of March 31, 2006
and December 31, 2005:


                                March 31,  December 31,
                                  2006         2005
                               _________________________
Commercial and other             $ 183,125    $ 182,396
SBA                                 47,380       46,867
Real estate construction            90,962       84,792
Real estate term                    93,184       83,748
Factoring/asset based lending       37,934       38,184
Other                                4,530        4,011
                               _________________________
  Loans, gross                     457,115      439,998
Unearned fee income                 (1,427)      (1,395)
                               _________________________
  Total loan portfolio             455,688      438,603
Less allowance for credit losses    (6,169)      (5,936)
                               _________________________
     Loans, net                  $ 449,519    $ 432,667
                               =========================



5.       PREMISES AND EQUIPMENT

Premises and  equipment  are stated at cost less  accumulated  depreciation  and
amortization.  Depreciation  and  amortization  are computed on a  straight-line
basis over the shorter of the lease term,  generally  three to fifteen years, or
the estimated useful lives of the assets, generally three to five years.

Premises and  equipment at March 31, 2006 and December 31, 2005 are comprised of
the following:


(dollars in thousands)
March 31, 2006
____________________________             Accumulated   Net Book
                                Cost     Depreciation   Value
                              _________  _____________ _________
Leasehold improvements         $ 2,304        $ (764)    $1,540
Furniture and fixtures             702          (440)       262
Capitalized Software             1,355          (923)       432
Equipment                        1,083          (779)       304
                              _________  _____________ _________
     Totals                    $ 5,444      $ (2,906)    $2,538
                              =========  ============  =========

December 31, 2005
____________________________             Accumulated   Net Book
                                Cost     Depreciation   Value
                              _________  _____________ _________
Leasehold improvements         $ 1,981        $ (700)    $1,281
Furniture and fixtures             676          (407)       269
Capitalized Software             1,344          (856)       488
Equipment                        1,076          (777)       299
                              _________  _____________ _________
     Totals                    $ 5,077      $ (2,740)    $2,337
                              =========  ============  =========

                                       12

<PAGE>


5.           JUNIOR SUBORDINATED DEBT SECURITIES AND OTHER BORROWINGS

JUNIOR SUBORDINATED DEBT SECURITIES

On December 21, 2004, the Company issued $12,372,000 of junior subordinated debt
securities (the "debt  securities") to Bridge Capital Trust I, a statutory trust
created under the laws of the State of  California.  These debt  securities  are
subordinated  to  effectively  all  borrowings  of the  Company  and are due and
payable in March,  2035.  Interest is payable quarterly on these debt securities
at a fixed rate of 5.9% for the first five years thereafter  interest accrues at
LIBOR plus 1.98%.  The debt  securities  can be redeemed at par at the Company's
option  beginning  in March,  2010;  they can also be redeemed at par if certain
events  occur that  impact the tax  treatment  of the capital  treatment  of the
issuance.

The Company also purchased a 3% minority  interest in the Trust.  The balance of
the  equity  of the  Trust is  comprised  of  mandatorily  redeemable  preferred
securities.

On March 30, 2006 the Company  issued  $5,155,000  of junior  subordinated  debt
securities (the "debt securities") to Bridge Capital Trust II, a statutory trust
created  under the laws of the State of  Delaware.  These  debt  securities  are
subordinated  to  effectively  all  borrowings  of the  Company  and are due and
payable in March,  2037.  Interest is payable quarterly on these debt securities
at a fixed rate of 6.60% for the first five years thereafter interest accrues at
LIBOR plus 1.38%.  The debt  securities  can be redeemed at par at the Company's
option  beginning  in April,  2011;  they can also be redeemed at par if certain
events  occur that  impact the tax  treatment  of the capital  treatment  of the
issuance.

The Company also purchased a 3% minority  interest in the trust.  The balance of
the  equity  of the  Trust is  comprised  of  mandatorily  redeemable  preferred
securities.

Under FASB  Interpretation  No.46 (FIN 46),  "Consolidation of Variable Interest
Entities,  an  interpretation  of ARB No. 51," these Trusts are not consolidated
into the company's financial  statements.  Prior to the issuance of FIN 46, bank
holding companies  typically  consolidated  these entities.  The Federal Reserve
Board has ruled  that  subordinated  notes  payable  to  unconsolidated  special
purpose  entities  ("SPE's")  such as  these  Trusts,  net of the  bank  holding
company's  investment in the SPE, qualify as Tier 1 Capital,  subject to certain
limits.

OTHER BORROWINGS

Other borrowings at March 31, 2006 are comprised of one advance from the Federal
Home Loan Bank of San Francisco for $10,000,000.  The advance is at a fixed rate
of 4.89% with a maturity date of April 14, 2006.

The advance is secured by loans totaling  approximately $17 million. As of March
31, 2006, the Bank had a total borrowing capacity of approximately $80 million.

The Bank also has unsecured  borrowing lines with  correspondent  banks totaling
$27million.  At March 31,  2006,  there were no  balances  outstanding  on these
lines.

6. STOCK-BASED COMPENSATION
SFAS No. 123R requires the use of a valuation  model to calculate the fair value
of  stock-based  awards.  The Company has elected to use the BSM  option-pricing
model, which incorporates  various assumptions  including  volatility,  expected
life,  and interest  rates.  The expected  volatility is based on the historical
volatility  of  the   Company's   common  stock  over  the  most  recent  period
commensurate  with the estimated  expected life of the Company's  stock options,
adjusted for the impact of unusual fluctuations not reasonably expected to recur
and other relevant factors including implied volatility in market traded options
on the  Company's  common  stock.  The  expected  life of an  award  is based on
historical  experience  and on the terms  and  conditions  of the  stock  awards
granted to employees.

                                       13

<PAGE>


The assumptions used for the three-month  periods ended March 31, 2006 and March
31, 2005 and the resulting estimates of weighted-average fair value per share of
options granted during those periods are as follows:

                  WEIGHTED AVERAGE ASSUMPTIONS FOR OPTIONS GRANTED
                  DURING THE PERIOD ENDED:
                                                     March 31,
                                                       2006
                                                    __________
                Expected life                        60 months

                Stock Volatility                      28.10%

                Risk free interest rate                3.66%

                Dividend yield                         0.00%


                                       14

<PAGE>


ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATION.

         In  addition  to the  historical  information,  this  quarterly  report
contains certain  forward-looking  information within the meaning of Section 27a
of the  Securities  Exchange  Act of 1933,  as  amended,  and section 21e of the
Securities Exchange Act of 1934, as amended,  and which are subject to the "Safe
Harbor"  created by those sections.  The reader of this Quarterly  report should
understand  that all such  forward-looking  statements  are  subject  to various
uncertainties  and risks that could affect their outcome.  The Company's  actual
results could differ  materially  from those  suggested by such  forward-looking
statements.  Such risks and uncertainties include, among others, (1) competitive
pressures  in the  Banking  industry  increases  significantly;  (2)  changes in
interest rate  environment  reduces  margin;  (3) general  economic  conditions,
either nationally or regionally are less favorable than expected,  resulting in,
among  other  things.  A  deterioration  in credit  quality;  (4) changes in the
regulatory  environment;  (5) changes in business conditions and inflation;  (6)
costs and expenses of  complying  with the internal  control  provisions  of the
Sarbanes-Oxley  Act and our  degree of  success  in  achieving  compliance;  (7)
changes in  securities  markets  (8) future  credit loss  experience;  (9) civil
disturbances of terrorist threats or acts, or apprehension about possible future
occurences of acts of this type;  and (10) the  involvement of the United States
in war or other hostilities. Therefore, the information in this quarterly report
should be carefully  considered  when  evaluating the business  prospects of the
Company.

CRITICAL ACCOUNTING POLICIES

         Our  accounting  policies  are  integral to  understanding  the results
reported.  Our most complex accounting policies require management's judgment to
ascertain the valuation of assets,  liabilities,  commitments and contingencies.
We have established  detailed policies and control  procedures that are intended
to ensure that valuation  methods are well  controlled and applied  consistently
from period to period. In addition,  the policies and procedures are intended to
ensure that the  process for  changing  methodologies  occurs in an  appropriate
manner. The following is a brief description of our current accounting  policies
involving significant management valuation judgments.

         Allowance for Loan Losses:  The  allowance  for loan losses  represents
management's  best estimate of losses  inherent in the existing loan  portfolio.
The  allowance  for loan losses is  increased by the  provision  for loan losses
charged to expense and reduced by loans  charged  off,  net of  recoveries.  The
provision  for loan losses is  determined  based on  management's  assessment of
several factors: reviews and evaluation of specific loans, changes in the nature
and volume of the loan portfolio,  current  economic  conditions and the related
impact  on  specific  borrowers  and  industry  groups,   historical  loan  loss
experiences,  the level of classified and nonperforming loans and the results of
regulatory examinations.

         Loans are  considered  impaired  if, based on current  information  and
events, it is probable that we will be unable to collect the scheduled  payments
of principal or interest when due according to the contractual terms of the loan
agreement.  The  measurement of impaired loans is generally based on the present
value of  expected  future cash flows  discounted  at the  historical  effective
interest   rate   stipulated   in  the   loan   agreement,   except   that   all
collateral-dependent  loans are measured for impairment  based on the fair value
of the  collateral.  In measuring the fair value of the  collateral,  management
uses assumptions and methodologies  consistent with those that would be utilized
by unrelated third parties.

         Changes in the financial condition of individual borrowers, in economic
conditions,  in historical  loss  experience and in the condition of the various
markets in which collateral may be sold may all affect the required level of the
allowance for loan losses and the associated provision for loan losses.

         The  Company has the ability and the intent to sell all or a portion of
certain  SBA loans in the loan  portfolio  and, as such,  carries  the  saleable
portion of these loans at the lower of  aggregate  cost or fair value.  At March
31, 2006 and December 31, 2005, the fair value of SBA loans  exceeded  aggregate
cost and therefore, SBA loans were carried at aggregate cost.

                                       15

<PAGE>


         In calculating  gain on the sale of SBA loans,  the Company performs an
allocation  based on the  relative  fair values of the sold portion and retained
portion of the loan.  The  Company's  assumptions  are validated by reference to
external market information.

         Available-for-sale  securities:  the  fair  value  of  most  securities
classified as  available-for-sale  is based on quoted market  prices.  If quoted
market prices are not available,  fair values are  extrapolated  from the quoted
prices of similar instruments.

         Supplemental  Employee  Retirement  Plan:  The Company has entered into
supplemental  employee  retirement  agreements with certain executive and senior
officers.  The  measurement  of the liability  under these  agreements  includes
estimates  involving  life  expectancy,  length of time before  retirement,  and
expected benefit levels. Should these estimates prove materially wrong, we could
incur additional or reduced expense to provide the benefits.


                                       16

<PAGE>


 SELECTED FINANCIAL DATA

         The following presents selected financial data and ratios as of and for
the quarter ended March 31, 2006 and 2005.

Statement of Operations Data:
____________________________
(dollars in thousands, except per share data)      Quarter ended March 31,
                                                    2006            2005
                                                _____________   ______________
Interest income                                      $ 10,928         $ 6,615
Interest expense                                        2,386           1,188
                                                _____________   ______________
Net interest income                                    8,542            5,427
Provision for credit losses                              222              333
                                                _____________   ______________
Net interest income after provision
  for credit losses                                    8,320            5,094
                                                _____________   ______________
Other income                                           1,083              784
Other expenses                                         6,338            4,315
                                                _____________   ______________
Income before income taxes                             3,065            1,563
Income taxes                                           1,134              606
                                                _____________   ______________
Net income                                           $ 1,931            $ 957
                                                =============   ==============

Per share Data:
_______________
Basic earnings per share                              $ 0.31           $ 0.16
Diluted earnings per share                              0.29             0.14
Shareholders' equity per share                          6.71             5.58
Cash dividend per common share                             -                -

                                                          March 31,
Balance Sheet Data:                                 2006            2005
___________________                             _____________   ______________
Balance sheet totals:
  Assets                                          $ 566,934       $ 448,440
  Loans, net                                         449,519          318,145
  Deposits                                           492,369          397,747
  Shareholders' equity                                41,981           34,275

Average balance sheet amounts:
  Assets                                          $ 540,099       $ 397,375
  Loans, net                                         421,543          299,625
  Deposits                                           470,012          342,187
  Shareholders' equity                                40,939           33,810

Selected Ratios:
________________
Return on average assets                               1.45%            0.96%
Return on average equity                              19.13%           11.32%
Leverage capital ratio                                10.22%           11.54%
Efficiency ratio                                      65.85%           69.47%
Net chargeoffs to average loans                        0.00%            0.00%
Allowance for loan losses to total loans               1.35%            1.39%
Average equity to average assets                       7.58%            8.51%

                                       17

<PAGE>


SUMMARY OF FINANCIAL RESULTS - QUARTER ENDED MARCH 31, 2006

The Company  reported net income of  $1,931,000  ($0.31 basic and $0.29  diluted
earnings per share) for the quarter ended March 31, 2006 as compared to $957,000
($0.16 basic and $0.14  diluted  earnings per share) for the quarter ended March
31, 2005.  The increase in net income  resulted  primarily from increases in net
interest income offset, in part, by lower non-interest income and an increase in
operating expenses.

The table below  highlights  the changes in the nature and sources of income and
expense.

<TABLE>
<CAPTION>


                                                      Quarter ended March 31,       Increase
                                                         2006           2005        (Decrease)
Operations                                           ____________   ____________  _____________
(dollars in thousands, except per share data)

<S>                                                     <C>             <C>            <C>
Interest income                                         $ 10,928        $ 6,615        $ 4,313
Interest expense                                           2,386          1,188          1,198
                                                     ____________   ____________  _____________

Net interest income                                        8,542          5,427          3,115
Provision for credit losses                                  222            333           (111)
                                                     ____________   ____________  _____________

Net interest income after provision
  for credit losses                                        8,320          5,094          3,226
                                                     ____________   ____________  _____________
Other income                                               1,083            784            299
Other expenses                                             6,338          4,315          2,023
                                                     ____________   ____________  _____________
Income before income taxes                                 3,065          1,563          1,502

Income taxes                                               1,134            606            528
                                                     ____________   ____________  _____________
Net income                                               $ 1,931          $ 957          $ 974
                                                     ============   ============  =============

</TABLE>


NET INTEREST INCOME AND MARGIN

         Net interest  income,  the difference  between interest earned on loans
and investments and interest paid on deposits is the principal  component of the
Company's earnings. Net interest income is affected by changes in the nature and
volume of earning  assets  held  during the  quarter,  the rates  earned on such
assets and the rates paid on interest bearing liabilities.

         Net interest income for the quarter ended March 31, 2006 was $8,542,000
comprised of $10,928,000 in interest income and $2,386,000 in interest  expense.
Net  interest  income  for the  quarter  ended  March  31,  2005 was  $5,427,000
comprised of $6,615,000 in interest  income and $1,188,000 in interest  expense.
Net interest income for the quarter ended March 31, 2006 represented an increase
of $3.1  million  or 57% over the same  period  one year  earlier.  The  average
balance  sheet and the general  interest  rate  environment  drive net  interest
income.

         The net interest margin (net interest income divided by average earning
assets) was 7.0% for the quarter  ended March 31, 2006 and  compared to 6.0% for
the same quarter in 2005.  The  improvement  in the net interest  margin was the
result of improved  balance  sheet  leverage  together with the impact of higher
short-term market interest rates.

         The following table details the average  balances,  interest income and
expense and the effective  yields/rates for earning assets and  interest-bearing
liabilities for the quarters ended March 31, 2006 and 2005.

                                       18

<PAGE>
<TABLE>
<CAPTION>

                                                   March 31,                              March 31,
                                                     2006                                  2005
                                    _____________________________________ ______________________________________
                                                (dollars in thousands)
                                                    YIELDS    INTEREST                     YIELDS    INTEREST
                                       AVERAGE        OR       INCOME/        AVERAGE        OR       INCOME/
                                       BALANCE       RATES     EXPENSE        BALANCE       RATES     EXPENSE
                                    _____________________________________ ______________________________________
<S>                                      <C>            <C>     <C>             <C>            <C>      <C>
ASSETS
Interest earning assets:
  Loans (1)                              $ 428,793      9.6%    $ 10,252        $ 304,831      8.2%     $ 6,270
  Federal funds sold                        52,550      4.4%         578           36,282      2.4%         221
  Investment securities (2)                 13,501      2.9%          98           22,719      2.2%         124
                                    _____________________________________ ______________________________________
Total interest earning assets              494,844      8.8%      10,928          363,832      7.3%       6,615
                                                   ______________________                 ______________________

Noninterest-earning assets:
  Cash and due from banks                   30,149                                 21,631
  All other assets (3)                      14,731                                 11,917
                                    _______________                       ________________
      TOTAL                              $ 539,724                              $ 397,380
                                    ===============                       ================

LIABILITIES AND
  SHAREHOLDERS' EQUITY
Interest bearing liabilities:
  Deposits:
   Demand                                  $ 3,369      0.8%           7          $ 3,266      0.6%         $ 5
   Savings                                 212,787      2.7%       1,427          153,496      1.7%         654
   Time                                     73,002      3.6%         665           52,431      2.4%         321
Other                                       22,111      5.2%         287           17,444      4.8%         208
                                    _____________________________________ ______________________________________
Total interest bearing liabilities         311,269      3.1%       2,386          226,637      2.1%       1,188
                                                   ______________________                 ______________________

Noninterest-bearing liabilities:
   Demand deposits                         180,853                                132,994
   Accrued expenses and
     other liabilities                       6,663                                  3,939
Shareholders' equity                        40,939                                 33,810
                                    _______________                       ________________
    TOTAL                                $ 539,724                              $ 397,380
                                    ===============                       ================

Net interest margin and
                                                             ____________                           ____________
  Net interest income                                   7.0%     $ 8,542                       6.0%     $ 5,427
                                                   ======================                 ======================
</TABLE>


(1)           Loan fee amortization of $892,000 and $721,000,  respectively,  is
              included  in  interest  income.   Nonperforming  loans  have  been
              included in average loan balances.
(2)           Interest  income  is  reflected  on an actual  basis,  not a fully
              taxable equivalent basis.  Yields are based on amortized cost.
(3)           Net of average  allowance  for  credit  losses of  $6,001,000  and
              $4,270,000, respectively.

                                       19



<PAGE>

                                       20

<PAGE>

         The following  table shows the effect of the interest  differential  of
volume and rate  changes for the  quarters  ended  March 31, 2006 and 2005.  The
change in interest due to both rate and volume has been  allocated in proportion
to the relationship of absolute dollar amounts of change in each.

VOLUME/RATE ANALYSIS
(dollars in thousands)
                                                   2006 vs. 2005
                                      _____________________________________
                                                  Increase (decrease)
                                                    due to change in
                                      _____________________________________
                                        Average     Average      Total
                                         Volume       Rate       Change
                                      _____________________________________
 Interest income:
   Loans                                  $ 2,964     $ 1,018     $ 3,982
   Federal funds sold                         179         178         357
   Investment securities                      (67)         41         (26)
                                      _____________________________________
      Total interest income                 3,076       1,237       4,313
                                      _____________________________________

 Interest expense:
   Demand                                       0           2           2
   Savings                                    398         375         773
   Time                                       187         157         344
   Other                                       61          18          79
                                      _____________________________________
       Total interest expense                 646         552       1,198
                                      _____________________________________

 Change in net interest income            $ 2,430       $ 685     $ 3,115
                                      ====================================


INTEREST INCOME

         Interest  income of $10.9  million in the quarter  ended March 31, 2006
represented  an increase of $4.3 million,  or 65%, over $6.6 million in the same
quarter one year earlier.  The increase in interest  income was primarily due to
growth in earning assets,  particularly growth in average loan balances. Average
earning  assets for the quarter  ended  March 31,  2006 were $494.8  million and
represented  growth of $131.0  million or 36% over  $363.8  million for the same
period in 2005.  Average gross loans were $428.8  million for three months ended
March 31, 2006, an increase of $124.0 million or 41% over $304.8 million for the
same period one year earlier.

         In  addition,  interest  income  increased  as a result of increases in
short-term  interest rates. The average yield on earning assets was 8.8% for the
quarter ended March 31, 2006 and 7.3% for the quarter ended March 31, 2005.  The
majority of the Company's  earning  assets,  including a majority of loans,  are
priced to adjust with movement in short-term  interest rates,  particularly  the
prime rate,  and the  increase in yield was  primarily  due to  increases in the
prime rate in the second half of 2005 and  continuing  into the first quarter of
2006.

         During the quarter  ended March 31,  2006,  the ratio of average  gross
loans to average deposits (one measure of leverage)  increased to 87.1%, up from
84.8% in the  comparable  period of 2005. In addition,  average loans  comprised
86.7% of  average  earning  assets  in the three  months  ended  March 31,  2006
compared to 83.8% in the first quarter of 2005.

         Other earning  assets,  consisting of  investment  securities,  federal
funds sold and interest bearing deposits in other banks,  averaged $66.0 million
for the quarter  ended March 31, 2006, an increase of $7.0 million or 11.9% from
$59.0 million for the three months ended March 31, 2005.

                                       21

<PAGE>


INTEREST EXPENSE

         Interest  expense was  $2,386,000 for the quarter ended March 31, 2006,
which  represented  an increase of $1,198,000 or 100.8% over  $1,188,000 for the
comparable  period of 2005. The increase in interest  expense reflects growth in
average   interest-bearing   liabilities  and  higher  interest  rates  paid  on
liabilities in 2006 compared to 2005. Average interest-bearing  liabilities were
$311.3  million for the three months ended March 31, 2006,  an increase of $84.7
million,  or 37.4%, over $226.6 million for the same period one year earlier. In
addition, the average rate paid on interest-bearing  liabilities was 3.1% in the
quarter  ended March 31, 2006 compared to 2.1% in the first quarter of 2005 as a
result of increases in short-term market interest rates.

         Net interest income is the principal source of the Company's  operating
earnings.  Significant factors affecting net interest income are: rates, volumes
and mix of the loan, investment and deposit portfolios. Due to the nature of the
Company's lending markets,  in which the majority of loans are generally tied to
Prime Rate, it is believed that an increase in interest rates should  positively
affect the Company's  future  earnings,  while a decline  should have a negative
impact.  However,  it is not  feasible to provide an accurate  measure of such a
change because of the many factors (many of them uncontrollable) influencing the
result.

PROVISION FOR CREDIT LOSSES

         The Company maintains an allowance for credit losses which is based, in
part,  on the Company's  and industry  loss  experience,  the impact of economic
conditions  within the Company's  market area, and, as applicable,  the State of
California,  the value of underlying  collateral,  loan performance and inherent
risks in the loan  portfolio.  The  allowance  is  reduced  by  charge-offs  and
increased by  provisions  for credit  losses  charged to  operating  expense and
recoveries of previously charged-off loans. The Company provided $222,000 to the
allowance  for credit  losses for the three  months  ended  March 31,  2006,  as
compared to $333,000  for the same period in 2005.  There were no loans  charged
off and $11,000 in  recoveries  during the three  months ended March 31, 2006 as
compared to no loans charged-off and $3,000 in recoveries during the three month
period ended March 31, 2005. At March 31, 2006,  the allowance for credit losses
was $6.17  million,  representing  1.35% of total  loans,  as  compared to $4.48
million, representing 1.39% of total loans, at March 31, 2005.

The following schedule provides an analysis of the allowance for credit losses

ANALYSIS OF THE ALLOWANCE FOR CREDIT LOSSES:

(dollars in thousands)                     March 31,
                                      2006         2005
                                   _________________________
Balance, beginning of period           $ 5,936      $ 4,146
Provision for credit losses                222          333
Charge-offs                                  -            -
Recoveries                                  11            3
                                   _________________________
Balance, end of period                 $ 6,169      $ 4,482
                                   =========================


         The accrual of interest on loans would be discontinued  and any accrued
and unpaid  interest is reversed  when, in the opinion of  management,  there is
significant doubt as to the  collectibility of interest or principal or when the
payment of principal  or interest is ninety days past due,  unless the amount is
well-secured and in the process of collection.  There were two non-accrual loans
totaling  $2,563,000  at March  31,  2006 and one loan  totaling  $2,320,000  at
December  31,  2005.  At March  31,  2006,  nonaccrual  loans  consisted  of one
commercial loan totaling $266,000,  which is secured by business assets and real
property  with  values in excess of the loan's  carrying  value and one SBA loan
totaling $2,297,000,  which is secured by real property with values in excess of
the loan's carrying value.

                                       22

<PAGE>

         In addition,  at March 31, 2006 and  December  31, 2005,  there were no
loans past due 90 days or more as to principal  or interest  and still  accruing
interest.

         At March 31, 2006 and December 31, 2005 there were no properties  owned
by the  Company  acquired  through  the  foreclosure  process  and there were no
restructured loans.

The following summarizes  nonperforming loans at March 31, 2006 and December 31,
2005.

<TABLE>
<CAPTION>

(dollars in thousands)                                     March 31,     December 31,
                                                              2006             2005
                                                        ___________________________________
<S>                                                              <C>               <C>
Loans accounted for on a nonaccrual basis                        $ 2,563           $ 2,320
Loans restructured and in compliance with modified
  terms                                                                -                 -
Other loans with principal or interestcontracturally
  past due 90 days or more                                             -                 -
                                                        ___________________________________
                                                                 $ 2,563           $ 2,320
                                                        ===================================
</TABLE>

         Based on an evaluation of the  individual  credits,  historical  credit
loss experienced by loan type and economic conditions,  management has allocated
the allowance for loan losses as follows for the period ended March 31, 2006 and
December 31, 2005:

<TABLE>
<CAPTION>

                                    March 31, 2006                   December 31, 2005
                              ______________________________   ______________________________
                                              Percent of                       Percent of
                                             loans in each                    loans in each
                                              category to                      category to
(dollars in thousands)           Amount       total loans         Amount       total loans
                              ______________________________   ______________________________

<S>                                   <C>             <C>              <C>             <C>
Commercial and other                  1,748           40.0%            2,029           41.5%
SBA                                   1,993           10.4%            1,975           19.3%
Real estate construction                971           19.9%              742           19.0%
Real estate term                        930           20.4%              721           10.7%
Factoring/ABL                           500            8.3%              443            8.7%
Other                                    27            1.0%               26            0.9%
                              ______________________________   ______________________________
                                    $ 6,169          100.0%          $ 5,936          100.0%
                              ==============================   ==============================
</TABLE>


         Management  is of the opinion that the  allowance  for credit losses is
maintained at a level adequate for known and unidentified losses inherent in the
loan  portfolio.   However,   the  Company's  loan  portfolio,   which  includes
approximately  $184,000,000 in real estate and construction loans,  representing
approximately  40% of the portfolio,  could be adversely  affected if California
economic conditions and the real estate market in the Company's market area were
to weaken.  The effect of such events,  although  uncertain at this time,  could
result  in an  increase  in the level of  non-performing  loans and OREO and the
level of the  allowance  for loan  losses,  which  could  adversely  affect  the
Company's future growth and profitability.

NON-INTEREST INCOME

         The following  table sets forth the  components of other income and the
percentage distribution of such income for the three months ended March 31, 2006
and 2005:

                                       23

<PAGE>

 NON-INTEREST INCOME
 (dollars in thousands)                2006                       2005
                            ________________________   ________________________
                               Amount     Percent         Amount     Percent
                            ________________________   ________________________

 Gain on sale of SBA loans        $ 451       41.7%          $ 420       53.6%
 SBA loan servicing income          117       10.8%             65        8.3%
 Depositor service charges          112       10.3%             68        8.7%
 Other operating income             403       37.2%            231       29.5%
                            ________________________   ________________________

                                $ 1,083      100.0%          $ 784      100.0%
                            ========================   ========================


         Non-interest income totaled $1,083,000 in the first quarter of 2006, an
increase  of  $299,000  or 38.1%  from  $784,000  in 2005.  Non-interest  income
consists primarily of gains recognized on sales of SBA loans, SBA loan servicing
income and packaging  fees and service  charge income on deposit  accounts.  The
increase in  non-interest  income for the first  quarter of 2006 was primarily a
result of an increase in SBA loan servicing income, an annual payment of $40,000
received  from  Zions Bank for SBA loan sale  volume  incentive  and  $61,000 in
warrant income recognized during the first quarter of 2006.

           Revenue  from  sales  of  SBA  loans  is   dependant  on   consistent
origination  and  funding  of new loan  volumes,  the  timing  of  which  may be
impacted,  from time to time, by (1) increased  competition  from other lenders;
(2) the relative attractiveness of SBA borrowing to other financing options; (3)
adjustment of programs by the SBA; (4) changes in activities of secondary market
participants and; (5) other factors. Gains recognized on sales of SBA loans were
$451,000 in the quarter  ended March 31, 2006 which  represented  an increase of
$31,000  or 7%  compared  to  $420,000  the same  period one year  earlier.  The
increase  was  attributed  to a higher  volume of loans sold during the quarter.
During the first  three  months of 2006 the  Company's  SBA group  funded  $11.6
million in new loans and sold $14.5  million  which  compared  to $12.9  million
funded and $10.6 million sold in the same period one year earlier.

NON-INTEREST EXPENSE

         The  components of other  expense are set forth in the following  table
for the three months ended March 31, 2006 and 2005.

         Other Expense as a Percent of Average Earning Assets
         (dollars in thousands)

                                              2006                   2005
                                       __________________     __________________
                                       Amount     Percent     Amount     Percent
                                       __________________     __________________

         Salaries and benefits         $3,919      3.2%       $2,552      2.1%
         Occupancy                        446      0.4%          403      0.3%
         Data processing                  362      0.3%          251      0.2%
         Legal and professional           208      0.2%          180      0.1%
         Furniture and equipment          168      0.1%          147      0.1%
         Other                          1,235      1.0%          782      0.6%
                                       ______                 ______
                                       $6,338      5.2%       $4,315      3.4%
                                       ======                 ======

         Operating expenses were $6,338,000 for the three months ended March 31,
2006, an increase of $2,023,000 or 46.9% from $4,315,000 at March 31, 2006. As a
percentage of average earning assets,  other expenses for the three months ended
March  31,  2006 and 2005 were 5.2% and  4.8%,  respectively,  on an  annualized
basis.  In 2006,  operating  expenses were  comprised  primarily of salaries and
benefits of  $3,919,000,  which compared to $2,552,000 in 2005 and other expense

                                       24

<PAGE>

of $1,235,000  which  compared to $782,000 in 2005. The increase in salaries and
benefits was primarily due to the additional  headcount  related to expansion of
the business. At March 31, 2006, the Company employed 113 FTE compared to 81 FTE
on the same date one year  earlier.  The increase in other  expense is primarily
due to an increase  of  $320,000  in expense  related to deposit and third party
services,  an increase of $57,000 in  marketing  and  advertising  expense and a
$48,000 amortization of a California Housing Tax Credit investment.


BALANCE SHEET

         Total assets of Bridge Bank at March 31, 2006 were $566.9  million,  an
increase of $118.5 million (26.4%) as compared to $448.4 million at December 31,
2005.  Growth in total  assets was  principally  due to an  increase  in deposit
balances.

         The  following  table  shows  the  Company's  loans by type  and  their
percentage  distribution  for the periods  ended March 31, 2006 and December 31,
2005.

LOAN PORTFOLIO
(dollars in thousands)                          March 31,    December 31,
                                                  2006            2005
                                             ________________________________
Commercial and other                               $ 183,125       $ 182,396
SBA                                                   47,380          46,867
Real estate construction                              90,962          84,792
Real estate other                                     93,184          83,748
Factoring and Asset based                             37,934          38,184
Other                                                  4,530           4,011
                                             ________________________________
Total gross loans                                    457,115         439,998
Unearned fee income                                   (1,427)         (1,395)
                                             ________________________________
  Total loan portfolio                               455,688         438,603
Less allowance for credit losses                      (6,169)         (5,936)
                                             ________________________________
     Loans, net                                    $ 449,519       $ 432,667
                                             ================================

Commercial and other                                   40.0%           41.5%
SBA                                                    10.4%           10.7%
Real estate construction                               19.9%           19.2%
Real estate term                                       20.4%           19.0%
Factoring and Asset based                               8.3%            8.7%
Other                                                   1.0%            0.9%
                                             ________________________________
Total gross loans                                     100.0%          100.0%
                                             ================================


         Net loan balances  increased to $449.5 million at March 31, 2006, which
represented an increase of $16.9 million (3.9%) as compared to $432.7 million at
December  31,  2005.  The  increase  in  loans  was  primarily  in  real  estate
construction  and real estate  other  (including  home equity  lines)  without a
concentration  in any one  specific  category of loans,  although  overall  real
estate  secured loans  comprise over 40% of loan balances at March 31, 2006. The
increase was a result of general marketing efforts.

         The Company's  commercial loan portfolio  represents loans to small and
middle-market businesses in the Santa Clara county region. Commercial loans were
$183.1  million at March 31, 2006,  which  represented  a slight  increase  over
$182.4  million at  December  31,  2005.  At March 31,  2006,  commercial  loans
comprised  40.0% of total loans  outstanding  compared to 41.5% at December  31,
2005.

                                       25

<PAGE>

         In March of 2002, the Company established an SBA lending group in Santa
Clara with a loan production  office in Sacramento  county. In October 2004, the
Company  established a loan production office in San Diego county.  The Company,
as a Preferred  Lender,  originates SBA loans and participates in the SBA 7A and
504 SBA lending programs. Under the 7A program, a loan is made for commercial or
real estate purposes. The SBA guarantees these loans and the guarantee may range
from 70% to 90% of the total loan. In addition, the loan could be collateralized
by a deed of trust on real  estate.  Under the 504  program,  The Company  lends
directly  to the  borrower  and  takes a  first  deed of  trust  to the  subject
property.  In addition  the SBA,  through a Community  Development  Corporation,
makes an  additional  loan to the borrower and takes a deed of trust  subject to
the Company's  position.  The Company's  position in relation to the real estate
"piggyback"  loans can range from 50% to 70% loan to value.  At March 31,  2006,
SBA loans comprised  $47.4 million,  or 10.4%, of total loans, a slight increase
from $46.9  million at December  31,  2005.  The Company has the ability and the
intent  to sell all or a portion  of the SBA loans  and,  as such,  carries  the
saleable  portion of SBA loans at the lower of aggregate cost or fair value.  At
March 31,  2006 and  December  31,  2005,  the fair value of SBA loans  exceeded
aggregate cost and therefore, SBA loans were carried at aggregate cost.

         The Company's  construction loan portfolio  primarily consists of loans
to finance individual  single-family  residential  homes,  approximately half of
which are owner-occupied projects. Construction loans increased $6.2 million, or
7.3%,  to $91.0  million at March 31, 2006 over $84.8  million at  December  31,
2005.  Construction  loan  balances at March 31, 2006  comprised  19.9% of total
loans compared to 19.2% at December 31, 2005.

         Other  real  estate  loans  increased  $9.5  million  or 11.3% to $93.2
million at March 31, 2006 over $83.7 million at December 31, 2005.  The increase
in other real estate loans was  approximately  equally split between home equity
lines of credit and other real  estate  term  loans.  Other  real  estate  loans
represented 20.4% of total loans at March 31, 2006 compared to 19.0% at December
31, 2005.

         Factoring  and  asset-based   lending  represents   purchased  accounts
receivable  (factoring)  and a structured  accounts  receivable  lending program
where the Bank receives client specific payment for client  invoices.  Under the
factoring  program,  the Bank purchases  accounts  receivable  invoices from its
clients and then  receives  payment  directly  from the party  obligated for the
receivable. In most cases the Bank purchases the receivables subject to recourse
from the Bank's  factoring  client.  The asset-based  lending program requires a
security interest in all of a client's accounts  receivable.  At March 31, 2006,
Factoring/Asset  Based  loans  totaled  $37.9  million or 8.3% of total loans as
compared to $38.2 million or 8.7% of total loans at December 31, 2005.

         Other loans  consist  primarily  of loans to  individuals  for personal
uses, such as installment purchases, overdraft protection loans and a variety of
other consumer purposes.  At March 31, 2006, other loans totaled $4.5 million as
compared to $4.0 million at December 31, 2005.

         Average  total  assets of the Company for the three  months ended March
31, 2006 were $540.1  million.  Average  earning assets reached $494.8  million,
representing  91.7% of total  assets,  in the three  months ended March 31, 2006
with an average  yield of 8.8%.  The increase in yield  reflects the increase in
the volume and yield of average earning assets. At March 31, 2006,  average loan
balances comprised $428.8 million,  representing 86.7% of average earning assets
and 87.1% of average  deposits as  compared to $202.8  million at March 31, 2005
representing 83.8% of average earning assets and 84.8% of average deposits.

         Deposits represent Bridge Bank's principal source of funds. Most of the
Bank's  deposits  are  obtained  from  professionals,  small-  to  medium  sized
businesses  and  individuals  within the Bank's market area.  The Bank's deposit
base consists of non-interest and interest-bearing demand deposits,  savings and
money  market  accounts  and  certificates  of  deposit.   The  following  table
summarizes  the  composition  of deposits as of March 31, 2006 and  December 31,
2005.

                                       26

<PAGE>
<TABLE>
<CAPTION>


DEPOSIT CATEGORIES
(dollars in thousands)                       March 31,                   December 31,
                                               2006                         2005
                                      ________________________     ________________________
                                                    Percent                      Percent
                                         Total     of total           Total     of total
                                        Amount     deposits          Amount     deposits
                                      ________________________     ________________________
<S>                                     <C>            <C>           <C>            <C>
Noninterest-bearing  demand             $ 188,827      38.35%        $ 185,557      39.64%
Interest-bearing demand                     2,993       0.61%            2,866       0.61%
Money market and savings                  210,663      42.79%          210,011      44.86%
Certificates of deposit:
  Less than $100                           26,250       5.33%           19,228       4.11%
  $100 and more                            63,635      12.92%           50,496      10.79%
                                      ________________________     ________________________

Total                                   $ 492,368     100.00%        $ 468,158     100.00%
                                      ========================     ========================
</TABLE>


         Deposits  increased  $24.2  million  or 5.2%  from  $468.2  million  at
December 31, 2005 to $492.4  million at March 31, 2006. The increase in deposits
was  primarily  in  Institutional  certificates  of deposit.  The increase was a
result of marketing efforts to attract such deposits in order to meet the Bank's
liquidity  needs and to accommodate  projected  loan funding.  Deposit totals at
March 31, 2006 included  $70.2  million,  or 14.3%,  in title and escrow company
account  balances  compared to $78.7  million,  or 19.8%,  at December 31, 2005.
Excluding title and escrow company account  balances,  deposits  increased $22.7
million or 5.4% compared to December 31, 2005.

         At March 31, 2006, the total number of deposit  accounts  reached 2,479
with  an  average   balance  per  account   (excluding   title  and  escrow)  of
approximately $173,192.

         Average  deposits for the three months ended March 31, 2006 were $470.0
million  comprised of average  interest-bearing  deposits of $289.2  million and
average non-interest bearing demand deposits of $180.9 million. The average rate
paid on  interest-bearing  deposits  was  2.9%  and the  Company's  overall  net
interest margin was 7.0%.

LEVERAGE

         Total gross loan  balances at March 31, 2006 were $457.1  million.  The
resulting  loan to deposit ratio was 91.2%.  Other  earning  assets at March 31,
2006 were primarily  comprised of Fed Funds sold of $62.2 million.  To date, the
Company  has  deployed  earning  assets  primarily  in Fed funds to address  the
potential  volatility of the title company  deposit  balances and to accommodate
projected loan funding.


CAPITAL RESOURCES

         The  Company and the Bank are  subject to the  capital  guidelines  and
regulations  governing  capital adequacy for bank holding companies and national
banks.  Additional capital  requirements may be imposed on banks based on market
risk.  The FDIC requires a Tier 1 capital(1)/  ratio to total assets ratio of 8%
for new banks during the first three years of operation.

______________________________

1/ Tier 1 capital is generally  defined as the sum of the core capital  elements
less goodwill and certain  intangibles.  The following items are defined as core
capital elements: (i) common stockholders' equity; (ii) qualifying noncumulative
perpetual  preferred stock and related surplus;  and (iii) minority interests in
the equity accounts of consolidated subsidiaries.


                                       27

<PAGE>

         After the first three years of operations,  the Comptroller  requires a
minimum  leverage  ratio of 3% of Tier 1 capital to total  assets  for  national
banks that have received the highest  composite  regulatory rating (a regulatory
measurement of capital, assets, management, earnings and liquidity) and that are
not anticipating or experiencing any significant  growth. All other institutions
are  required to maintain a leverage  ratio of at least 100 to 200 basis  points
above the 3% minimum.


         The Comptroller's regulations also require national banks to maintain a
minimum ratio of  qualifying  total  capital to  risk-weighted  assets of 8.00%.
Risk-based capital ratios are calculated with reference to risk-weighted assets,
including  both on and  off-balance  sheet  exposures,  which are  multiplied by
certain risk  weights  assigned by the  Comptroller  to those  assets.  At least
one-half of the qualifying capital must be in the form of Tier 1 capital.


         The risk-based capital ratio focuses principally on broad categories of
credit risk,  and might not take into account many other factors that can affect
a bank's financial  condition.  These factors include overall interest rate risk
exposure;  liquidity,  funding  and  market  risks;  the  quality  and  level of
earnings;   concentrations   of  credit  risk;   certain   risks   arising  from
nontraditional   activities;   the  quality  of  loans  and   investments;   the
effectiveness of loan and investment policies;  and management's overall ability
to monitor  and  control  financial  and  operating  risks,  including  the risk
presented  by  concentrations  of  credit  and  nontraditional  activities.  The
Comptroller has addressed many of these areas in related rule-making  proposals.
In addition to  evaluating  capital  ratios,  an overall  assessment  of capital
adequacy  must  take  account  of each of  these  other  factors  including,  in
particular,  the level and severity of problem and adversely  classified assets.
For this reason, the final supervisory judgment on a bank's capital adequacy may
differ  significantly  from the conclusions  that might be drawn solely from the
absolute level of the Company's  risk-based  capital ratio.  The Comptroller has
stated that banks generally are expected to operate above the minimum risk-based
capital ratio. Banks contemplating significant expansion plans, as well as those
institutions  with  high or  inordinate  levels  of risk,  should  hold  capital
consistent with the level and nature of the risks to which they are exposed.


         Further,  The  Banking  agencies  have  adopted  modifications  to  the
risk-based  capital  regulations  to include  standards  for interest  rate risk
exposures.  Interest  rate risk is the  exposure of a bank's  current and future
earnings and equity  capital  arising from  movements in interest  rates.  While
interest  rate risk is inherent in a bank's role as financial  intermediary,  it
introduces volatility to bank earnings and to the economic value of The Company.
The Banking agencies have addressed this problem by implementing  changes to the
capital standards to include a bank's exposure to declines in the economic value
of its  capital  due to changes in  interest  rates as a factor that The Banking
agencies  consider  in  evaluating  an  institution's  capital  adequacy.   Bank
examiners  consider a bank's historical  financial  performance and its earnings
exposure to interest rate movements as well as  qualitative  factors such as the
adequacy of a bank's internal interest rate risk management.


         Finally,  institutions with significant trading activities must measure
and hold capital for exposure to general  market risk arising from  fluctuations
in interest rates,  equity prices,  foreign  exchange rates and commodity prices
and exposure to specific risk associated  with debt and equity  positions in the
trading portfolio.  General market risk refers to changes in the market value of
on-balance-sheet  assets and off-balance-sheet items resulting from broad market
movements.  Specific  market  risk  refers to  changes  in the  market  value of
individual  positions  due to  factors  other than broad  market  movements  and
includes such risks as the credit risk of an instrument's issuer. The additional
capital  requirements  apply  effective  January  1, 1998 to  institutions  with
trading assets and  liabilities  equal to 10% or more of total assets or trading
activity  of $1 billion or more.  The  federal  banking  agencies  may apply the
market risk regulations on a case-by-case  basis to institutions not meeting the
eligibility criteria if necessary for safety and soundness reasons.

                                       28

<PAGE>

         In connection with the recent  regulatory  attention to market risk and
interest rate risk, the federal banking agencies will evaluate an institution in
its  periodic  examination  on the degree to which  changes in  interest  rates,
foreign exchange rates, commodity prices or equity prices can affect a financial
institution's  earnings or  capital.  In  addition,  the  agencies  focus in the
examination on an  institution's  ability to monitor and manage its market risk,
and will  provide  management  with a clearer  and more  focused  indication  of
supervisory concerns in this area.


         Under certain  circumstances,  the  Comptroller  may determine that the
capital  ratios for a national  bank shall be  maintained  at levels,  which are
higher than the minimum levels required by the guidelines. A national bank which
does not achieve and maintain adequate capital levels as required may be subject
to  supervisory  action by the  Comptroller  through  the  issuance of a capital
directive to ensure the maintenance of required capital levels. In addition, the
Company is required to meet certain guidelines of the Comptroller concerning the
maintenance of an adequate allowance for loan and lease losses.

         The  Company's  Tier 1  capital  at March 31,  2006 was  $55.1  million
comprised  of $34.2  million  of  capital  stock and  surplus,  $7.7  million in
retained  earnings and trust  preferred  securities up to the allowable limit of
$13.2.

         The  following  table shows the Company's  capital  ratios at March 31,
2006 and December 31, 2005 as well as the minimum  capital ratios required to be
deemed "well capitalized" under the regulatory framework.

                                       29

<PAGE>
<TABLE>
<CAPTION>

                                             As of March 31,          As of December 31,
             (in thousands)                      2006                       2005
                                         ________________________  _________________________
                                           Amount       Ratio         Amount       Ratio
                                         ________________________  _________________________
Company Capital Ratios
________________________________________
<S>                                          <C>          <C>           <C>          <C>
Tier 1 Capital                               $55,149      10.74%        $51,593      10.38%
(to Risk Weighted Assets)
Tier 1 capital minimum requirement           $20,543       4.00%        $19,879       4.00%

Total Capital                                $65,065      12.67%        $57,529      11.58%
(to Risk Weighted Assets)
Total capital minimum requirement            $41,085       8.00%        $39,758       8.00%

Company leverage
Tier 1 Capital                               $55,149      10.22%     $ 51,593        11.07%
(to Average Assets)
Total capital minimum requirement            $21,589       4.00%     $ 18,638         4.00%

Bank Risk Based Capital Ratios
________________________________________
Tier 1 Capital                               $52,040      10.13%        $49,748      10.49%
(to Risk Weighted Assets)
Tier 1 capital minimum requirement           $20,542       4.00%        $18,970       4.00%
To be well capitalized under
  prompt corrective action provisions        $30,814       6.00%        $28,455       6.00%

Total Capital                                $58,209      11.33%        $55,684      11.74%
(to Risk Weighted Assets)
Total capital minimum requirement            $41,084       8.00%        $37,939       8.00%
To be well capitalized under
  prompt corrective action provisions        $51,357      10.00%        $47,424      10.00%

Bank leverage
Tier 1 Capital                               $52,040       9.64%        $49,748       9.98%
(to Average Assets)
Total capital minimum requirement            $21,587       4.00%        $19,931       4.00%
To be well capitalized under
  prompt corrective action provisions        $26,986       5.00%        $24,914       5.00%

</TABLE>

However,  de novo banks are generally  required to hold capital in excess of the
amounts depicted in the table above. FDIC policies  generally  preclude dividend
payments  during the first three years of operation,  allow cash dividends to be
paid only from net  operating  income,  and do not permit  dividends  to be paid
until an appropriate  allowance for loans and lease losses has been  established
and overall capital is adequate. The FDIC requires that a depository institution
maintain a Tier 1 capital  to assets  ratio of not less than 8% during the first
three years of operation.

The Company and the Bank were considered well capitalized at March 31, 2006.

                                       30

<PAGE>

ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

LIQUIDITY/INTEREST RATE SENSITIVITY

         The  Company  manages its  liquidity  to provide  adequate  funds at an
acceptable  cost to support  borrowing  requirements  and  deposit  flows of its
customers.  At  March  31,  2006 and  December  31,  2005,  liquid  assets  as a
percentage of deposits were 19.2% and 17.5%,  respectively.  In addition to cash
and due from banks,  liquid assets  include  interest-bearing  deposits in other
banks, Federal funds sold and securities available for sale. The Company has $27
million in Federal funds lines of credit available with  correspondent  banks to
meet liquidity needs and additionally has approximately $27 million in borrowing
capacity at the Federal Home Loan Bank of San Francisco.  The Company's  balance
sheet position is asset-sensitive (based upon the significant amount of variable
rate loans and the  repricing  characteristics  of its deposit  accounts).  This
balance sheet position generally provides a hedge against rising interest rates,
but has a  detrimental  effect  during  times of interest  rate  decreases.  Net
interest income is generally  negatively impacted in the short term by a decline
in interest  rates.  Conversely,  an increase  in interest  rates  should have a
short-term positive impact on net interest income.

         The  following   table  sets  forth  the   distribution   of  repricing
opportunities,  based on contractual  terms of The Company's  earning assets and
interest-bearing  liabilities at March 31, 2006,  the interest rate  sensitivity
gap  (i.e.   interest  rate  sensitive   assets  less  interest  rate  sensitive
liabilities),  the cumulative  interest rate  sensitivity gap, the interest rate
sensitivity gap ratio (i.e.  interest rate sensitive  assets divided by interest
rate sensitive  liabilities)  and the cumulative  interest rate  sensitivity gap
ratio.

<TABLE>
<CAPTION>

DISTRIBUTION OF REPRICING OPPORTUNITIES
March 31, 2006
(dollars in thousands)
                                             After three  After six   After one
                                    Within   months but   months but  year but    After
                                    three    within six   within one   within      five
                                    months     months        year     five years  years      Total
                                 _____________________________________________________________________
<S>                                  <C>             <C>          <C>       <C>        <C>   <C>
Federal funds sold                   $62,235         $ -          $ -       $ -        $ -   $ 62,235
U.S. Treasury securities                   -          99            -        99          -        198
Agency securities                      3,243       1,982        3,926     4,880          -     14,031
Loans                                367,369      29,709        4,965    43,277     11,795    457,115
                                 _____________________________________________________________________
 Total earning assets                432,847      31,790        8,891    48,256     11,795    533,579
                                 _____________________________________________________________________
Interest checking, money market
  and savings                        213,656       -----        -----     -----      -----    213,656
Certificates of deposit:
 Less than $100,000                   27,857       7,524       19,247     9,007      -----     63,635
  $100,000 or more                     3,226       3,057        9,987     9,980      -----     26,250
                                 _____________________________________________________________________
 Total interest-bearing liabilities  244,739      10,581       29,234    18,987          0    303,541
                                 _____________________________________________________________________
Interest rate gap                   $188,108     $21,209     ($20,343)  $29,269    $11,795   $230,038
                                 =====================================================================
Cumulative interest rate gap        $188,108    $209,317     $188,974  $218,243   $230,038
                                 =========================================================
Interest rate gap ratio                 0.43        0.67        (2.29)     0.61       1.00
                                 =========================================================
Cumulative interest rate gap ratio      0.43        0.45         0.40      0.42       0.43
                                 =========================================================
</TABLE>

         Based on the  contractual  terms of its  assets  and  liabilities,  The
Company's  balance  sheet as March 31, 2006 was asset  sensitive in terms of its
short-term  exposure to interest rates. That is, at March 31, 2006 the volume of
assets  that  might  reprice  within  the  next  year  exceeded  the  volume  of
liabilities  that might reprice.  This position  provides a hedge against rising
interest rates, but has a detrimental effect during times of rate decreases. Net

                                       31

<PAGE>

interest  income is  negatively  impacted  by a decline  in  interest  rates and
positively  impacted by an increase in interest rates. To partially mitigate the
adverse impact of declining  rates,  the majority of variable rate loans made by
the Company have been written with a minimum "floor" rate.

The following  table shows  maturity and interest rate  sensitivity  of the loan
portfolio  at  March  31,  2006 and  December  31,  2005.  At  March  31,  2006,
approximately75%  of the loan  portfolio is priced with floating  interest rates
which limit the exposure to interest rate risk on long-term loans.

                            Balances at                Due after one
                             March 31,    Due one year year through  Due after
(dollars in thousands)          2006        or less     five years   five years
________________________________________________________________________________
Commercial and other            $ 183,125      $89,305       $85,614     $8,206
SBA                                47,380        7,602         1,031     38,747
Real estate construction           90,962       90,962             -          -
Real estate-other                  93,184       29,357        15,682     48,145
Factoring/ABL                      37,934       37,669           265          -
Other                               4,530        3,640           890          -
                           _____________________________________________________
TOTAL                           $ 457,115     $258,535      $103,482    $95,098
                           =====================================================

                            Balances at                Due after one
                            December 31,  Due one year year through  Due after
(dollars in thousands)          2005        or less     five years   five years
________________________________________________________________________________
Commercial and other             $182,396      $99,900       $76,216     $6,280
SBA                                46,867        5,976           135     40,756
Real estate construction           84,792       80,609         4,183          -
Real estate-other                  83,748       28,215         6,627     48,906
Factoring/ABL                      38,184       37,134         1,050          -
Other                               4,011        3,755           256          -
                           _____________________________________________________
TOTAL                            $439,998     $255,589       $88,467    $95,942
                           =====================================================



OFF-BALANCE SHEET ARRANGEMENTS AND AGGREGATE CONTRACTUAL OBLIGATIONS

The definition of "off-balance  sheet  arrangements"  includes any  transaction,
agreement or other  contractual  arrangement to which an entity is a party under
which we have:

o        Any obligation under a guarantee contract that has the  characteristics
         as defined in paragraph 3 of FASB  Interpretation No. 45,  "Guarantor's
         Accounting and Disclosure Requirements for Guarantee including Indirect
         Guarantees of Indebtedness to Others" ("FIN 45");
o        A  retained  or  contingent   interest  in  assets  transferred  to  an
         unconsolidated  entity or similar  arrangement  that  serves as credit,
         liquidity or market risk  support to that entity for such assets,  such
         as  a  subordinated   retained   interest  in  a  pool  of  receivables
         transferred to an unconsolidated entity;
o        Any  obligation,  including a contingent  obligation,  under a contract
         that would be accounted for as a derivative instrument,  except that it
         is both  indexed  to the  registrant's  own  stock  and  classified  in
         stockholders' equity; or
o        Any  obligation,  including  contingent  obligations,  arising out of a
         material variable interest,  as defined in FASB  Interpretation No. 46,
         "Consolidation  of  Variable  Interest  Entities"  ("FIN  46"),  in  an
         unconsolidated entity that provides financing,  liquidity,  market risk
         or credit  risk  support to the  registrant,  or  engages  in  leasing,
         hedging or research and development services with the registrant.

                                       32

<PAGE>


         In the ordinary course of business,  we have issued certain  guarantees
         which qualify as off-balance sheet  arrangements,  as of March 31, 2006
         those guarantees include the following:

                  Standby Letters of Credit in the amount of $9,708,000.

The  table  below  summarizes  the  Company's   off-balance   sheet  contractual
obligations.

<TABLE>
<CAPTION>

                                                      Payments due by period
                           __________________________________________________________________________
 Contractural Obligations                    Less than       1 - 3          3 - 5       More than
                                Total         1 year         years          years        5 years
_____________________________________________________________________________________________________

<S>                              <C>           <C>             <C>                <C>            <C>
Long-term contracts              $ 146,000     $ 116,000       $ 30,000           $ -            $ -

Operating leases                11,155,000       946,000      2,206,000     2,488,000      5,515,000
                           __________________________________________________________________________

Total                         $ 11,301,000   $ 1,062,000    $ 2,236,000   $ 2,488,000    $ 5,515,000
                           ==========================================================================

</TABLE>


ITEM 4 - CONTROLS AND PROCEDURES


DISCLOSURE CONTROLS AND PROCEDURES

As required by SEC rules, the Company's  management evaluated the effectiveness,
as of March 31, 2006, of the Company's  disclosure controls and procedures.  The
Company's chief executive  officer and chief financial  officer  participated in
the evaluation.  Based on this evaluation, the Company's chief executive officer
and chief financial officer concluded that the Company's disclosure controls and
procedures were effective as of March 31, 2006.


INTERNAL CONTROL OVER FINANCIAL REPORTING

Internal  control  over  financial   reporting  is  defined  in  Rule  13a-15(f)
promulgated under the Securities  Exchange Act of 1934 as a process designed by,
or under the  supervision  of, the company's  principal  executive and principal
financial officers and effected by the company's board of directors,  management
and other personnel,  to provide reasonable  assurance regarding the reliability
of financial reporting and the preparation of financial  statements for external
purposes  in  accordance  with  generally  accepted  accounting  principles  and
includes those policies and procedures that:

Pertain to the maintenance of records that in reasonable  detail  accurately and
fairly  reflect the  transactions  and  dispositions  of assets of the  company;
provide  reasonable  assurance  that  transactions  are recorded as necessary to
permit preparation of financial statements in accordance with generally accepted
accounting  principles,  and that receipts and  expenditures  of the company are
being made only in accordance with authorizations of management and directors of
the company;  and p rovide reasonable  assurance regarding  prevention or timely
detection of  unauthorized  acquisition,  use of  disposition  of the  company's
assets that could have a material effect on the financial statements.

Because of its inherent  limitations,  internal control over financial reporting
may not  prevent  or detect  misstatements.  Projections  of any  evaluation  of
effectiveness to future periods are subject to the risk that controls may become

                                       33

<PAGE>

inadequate  because of changes in  conditions,  or that the degree of compliance
with the policies or procedures may  deteriorate.  No change occurred during the
first quarter of 2006 that has materially  affected,  or is reasonably likely to
materially affect, the Company's internal control over financial reporting.

MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

The  Company's  management  is  responsible  for  establishing  and  maintaining
adequate internal control over financial  reporting for the Company.  Management
assessed the  effectiveness  of the Company's  internal  control over  financial
reporting as of March 31, 2006, using the criteria set forth by the Committee of
Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control -
Integrated Framework. Based on this assessment,  management concluded that as of
March 31, 2006,  the Company's  internal  control over  financial  reporting was
effective.
                                     PART II

ITEM 1 - LEGAL PROCEEDINGS


         The Company is not a defendant in any pending legal  proceedings and no
such proceedings are known to be contemplated.  No director, officer, affiliate,
more than 5%  shareholder  of the Company or any associate of these persons is a
party adverse to the Company or has a material  interest  adverse to the Company
in any material legal proceeding.


ITEM 1A - RISK FACTORS


CHANGES IN ACCOUNTING RULES COULD AFFECT THE COMPANY'S FUTURE OPERATING RESULTS.

Financial  statements are prepared in accordance  with U.S.  generally  accepted
accounting principles. These principles are subject to interpretation by various
governing  bodies,  including  the FASB and the SEC,  who create  and  interpret
appropriate  accounting  standards.  A change from current accounting  standards
could have a  significant  effect on the  Company's  results of  operations.  In
December  2004,  the FASB issued new guidance that  addresses the accounting for
share-based  payments,  SFAS No. 123R,  which the Company  adopted on January 1,
2006. In the first quarter of 2006,  stock-based  compensation  expense  reduced
basic earnings per common share by approximately $0.02. Although the effect from
the  adoption of SFAS No.  123R is  expected  to continue to have an  immaterial
impact on the  Company's  results  of  operations,  future  changes  to  various
assumptions  used to determine the fair-value of awards issued or the amount and
type of equity  awards  granted  create  uncertainty  as to the amount of future
stock-based compensation expense.


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


         Not applicable.


ITEM 3 - DEFAULTS UPON SENIOR SECURITIES


         Not applicable.


ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS


         Not applicable.

                                       34

<PAGE>


ITEM 5 - OTHER INFORMATION


         None.


ITEM 6 -  EXHIBITS


         (A) EXHIBITS


         See Index to Exhibits at page 32 of this Quarterly Report on Form 10-Q.

                                       35

<PAGE>


                                INDEX TO EXHIBITS




EXHIBIT
NUMBER      DESCRIPTION OF EXHIBIT

(31.1)      Certification of Principal Executive Officer pursuant to Section 302
            of the Sarbanes-Oxley Act of 2002

(31.2)      Certification of Principal Financial Officer pursuant to Section 302
            of the Sarbanes-Oxley Act of 2002

(32.1)      Certification of Principal Executive Officer pursuant to 18 U.S.C.
            Section 1350

(32.2)      Certification of Principal Financial Officer pursuant to 18 U.S.C.
            Section 1350

                                       36

<PAGE>




                                   SIGNATURES


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



                                  BRIDGE CAPITAL HOLDINGS




Dated: May 4, 2006                By:  /s/ DANIEL P. MYERS
                                       _________________________

                                           Daniel P. Myers
                                           President and Chief Executive Officer
                                           (Principal Executive Officer)



Dated: May 4, 2006                By:   /s/ THOMAS A. SA
                                       ___________________________
                                            Thomas A. Sa
                                            Executive Vice President and
                                            Chief Financial Officer
                                            (Principal Financial and
                                            Accounting Officer)



                                       37