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                                                                    EXHIBIT 10.8

                        EXTENSION OF EMPLOYMENT AGREEMENT

         This Extension of Employment Agreement (the "Agreement") is made this
31st day of December, 2001 between SOUTHWEST COMMUNITY BANK, a California
banking corporation, (the "Bank"), and STUART F. McFARLAND ("McFarland") with
reference to the following facts.

         A.       McFarland is currently employed as Bank's Executive Vice
President and Chief Credit Officer.

         B.       Bank and McFarland desire to enter into this Agreement
formalizing and extending the term of McFarland's employment by the Bank and
memorializing the agreed terms of that employment.

         NOW, THEREFORE, in consideration of the mutual covenants hereinafter
set forth, and intending to be legally bound, it is agreed that the following
terms and conditions shall apply to McFarland's employment:

         A.       TERM OF EMPLOYMENT

                  1.       Term. The Bank hereby employs McFarland and McFarland
hereby accepts continued employment with the Bank for the period (the "Term")
commencing January 1, 2002 and terminating on such date and upon such terms as
provided for in Paragraph F of this Agreement. This employment is "At Will" and
may be terminated by either party, with or without cause.

         B.       DUTIES OF McFarland

                  1.       Duties. McFarland shall continue to perform the
duties of Executive Vice President and Chief Credit Officer of the Bank, subject
to the powers by law vested in the Board of Directors of the Bank and in the
Bank's shareholders. During the Term, McFarland shall perform exclusively the
services herein contemplated to be performed by McFarland faithfully,
diligently, and to the best of McFarland's ability, consistent with the highest
and best standards of the banking industry and in compliance with all applicable
laws and the Bank's Articles of Incorporation, Bylaws, and internal written
policies.

                  2.       Conflicts of Interest. Except as permitted by the
prior written consent of the Board of Directors of the Bank, McFarland shall
devote McFarland's entire productive time, ability, and attention to the
business of the Bank during the Term, and McFarland shall not directly or
indirectly render any services of a business, commercial, or professional
nature, to any other person, firm, or corporation, whether for compensation or
otherwise, which are in conflict with the Bank's interest. Notwithstanding the
foregoing, McFarland may make investments of a passive nature in any business or
venture, provided, however, that neither such business or venture is in
competition, immediately following the effective date of consummation

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of such merger or other corporate reorganization directly or indirectly, in any
manner with the Bank.

         C.       COMPENSATION

                  1.       Salary. For McFarland's services hereunder, the Bank
shall pay or cause to be paid as annual base salary to McFarland the sum of One
Hundred Fifty Thousand Dollars ($150,000) for each year (i.e., 12-month period)
of the Term. Said salary shall be payable in equal installments in conformity
with the Bank's normal payroll period. Annual adjustments after the first year
of the Term may be made in the discretion of the Board of Directors.

                  2.       Additional Compensation. McFarland's prior
arrangement for certain commissions has been terminated effective with the
commencement of the terms of this Agreement.

                  3.       Bonuses. The Bank may, but shall not be required to,
award bonuses in its sole and absolute discretion.

         D.       EMPLOYEE BENEFITS

                  1.       Vacation. McFarland shall be entitled to a four (4)
week vacation during each year of the Term; provided, however, that for each
year of the Term, McFarland is required to and shall take at least two (2) weeks
of said vacation (the "Mandatory Vacation"), which shall be taken consecutively.

                  2.       Automobile. During the Term hereunder, the Bank shall
provide McFarland, for McFarland's sole use, a suitable full-sized automobile,
the specific make and model of such automobile to be determined jointly by
McFarland and the Bank, which automobile shall be initially new and at no time
be older than three (3) years. The Bank shall pay all operating expenses of any
nature whatsoever with regard to such automobile, provided McFarland furnishes
to the Bank adequate records and other documentary evidence required by federal
and state statutes and regulations issued by the appropriate taxing authorities
for the substantiation of such payments as deductible business expenses of the
Bank and not as deductible compensation to McFarland.. The Bank shall also
procure and maintain in force an automobile liability insurance policy on such
automobile, containing all reasonable and necessary coverage.

                  3.       Group Medical and Life Insurance Benefits. The Bank
shall provide for McFarland, at Bank's expense, participation in the Bank's
existing Group medical and life insurance program at a level commensurate for an
employee of McFarland's salary level. Said coverage shall be in existence or
shall take effect as of the Effective Date hereof and shall continue throughout
the Term. The Bank's liability to McFarland for any breach of this Paragraph
shall be limited to the amount of premiums required hereunder to be payable by
the Bank to obtain or maintain, as applicable, the coverage contemplated herein.

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                  4.       Stock Options. The Bank has heretofore granted stock
options to purchase shares of the Bank's authorized but unissued Common Stock,
at an exercise price equal to market value on the date of grant, subject to
compliance with any applicable requirements of the Bank's Stock Option Permit
issued by the California Department of Financial Institutions. Additional
options may be granted from time to time at the sole and absolute discretion of
the Bank's Board of Directors.

                  5.       Deferred Compensation Plan. Bank agrees to use
reasonable best efforts to establish a Deferred Compensation Plan for the
benefit of McFarland prior to January 1, 2003; provided, that such Plan shall be
in the then current best interest of Bank and its shareholders, and, further
provided, that such Plan shall meet and not materially impair all then current
regulatory requirements, including capital ratio requirements.

                  6.       Other Benefits. McFarland shall be entitled to
participate in any other employee benefit plan offered by the Bank from time to
time for senior executive employees at McFarland's level, subject to the
eligibility and vesting requirements set forth in said employee benefit Plan.

         E.       REIMBURSEMENT FOR BUSINESS EXPENSES

                  McFarland shall be entitled to reimbursement by the Bank for
any ordinary and necessary business expenses incurred by McFarland in the
performance of McFarland's duties and in acting for the Bank during the Term,
which types of expenditures shall be determined by the Board of Directors,
provided that:

                           (a)      Each such expenditure is of a nature
qualifying it as a proper deduction on the federal and state income tax returns
of the Bank as a business expense and not as a deductible compensation to
McFarland; and

                           (b)      McFarland furnishes to the Bank adequate
records and other documentary evidence required by federal and state statutes
and regulations issued by the appropriate taxing authorities for the
substantiation of such expenditures as deductible business expenses of the Bank
and not as deductible compensation to McFarland.

         F.       TERMINATION

                  1.       Termination. Employment under this Agreement is "At
Will", subject only to reasonable notice. However, the Bank may terminate this
Agreement forthwith without prior notice at any time by action of the Board of
Directors if McFarland fails to perform or habitually neglects the duties which
he is required to perform hereunder, if McFarland engages in illegal activity
which materially adversely affects the Bank's reputation in the community or
which evidences the lack of McFarland's fitness or ability to perform
McFarland's duties as reasonably determined by the Board of Directors in good
faith, or if McFarland commits any act which would cause termination of coverage
under the Bank's Bankers' Blanket Bond as to McFarland (as distinguished from
termination of coverage as to the Bank as a whole). In the event the Bank
terminates this Agreement for cause as provided herein, McFarland shall not be

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eligible for any severance benefits otherwise contemplated by this Agreement.
Such termination shall not prejudice any remedy which the Bank may have at law,
in equity, or under this Agreement.

                  2.       Death or Disability. In the event of McFarland's
death, or if McFarland is found to be physically or mentally disabled (as
hereinafter defined) by the Board of Directors in good faith, this Agreement
shall terminate without any further liability or obligation by the Bank to
McFarland.

                  For purposes of this Agreement only, physical or mental
disability shall be defined as McFarland being unable to fully perform under
this Agreement for a continuous period of ninety (90) days or a cumulative
period of 120 days in any calendar year. If there should be a dispute between
the Bank and McFarland as to McFarland's physical or mental disability for
purposes of this Agreement, the question shall be settled by the opinion of an
impartial reputable physician or psychiatrist agreed upon by the parties or
their representatives, or if the parties cannot agree within ten (10) days after
a request for designation of such party, then by a physician or psychiatrist
designated by the San Diego County Medical Association. The certification of
such physician or psychiatrist as to the question in dispute shall be final and
binding upon the parties hereto.

                  3.       Action by Supervisory Authority. If the Bank is
closed by or taken over by the California Department of Financial Institutions
or other supervisory authority, including the Federal Deposit Insurance
Corporation, such bank supervisory authority may immediately terminate this
Agreement without further liability or obligation by the Bank to McFarland.

                  4.       Merger or Other Corporate Reorganization. In the
event of: (i) a merger where the Bank is not the surviving corporation, (ii) a
transfer of all or substantially all of the assets of the Bank or (iii) any
acquisition, consolidation, or other corporate reorganization where there is a
change in ownership of at least fifty-one percent (S 1%), except that may result
from a transfer of shares to another corporation in exchange for at least eighty
percent (80%) control of that corporation, and, in the event that this Agreement
and McFarland's employment are terminated (a) by McFarland within six (6) months
after such merger or reorganization, or (b) by the surviving entity for any
reason other than as defined in section F.1, F.2, or F.3 above, during the two
(2) year period immediately following the effective date of consummation of such
merger or other corporate reorganization and/or (c) McFarland's title, duties
and responsibilities are materially reduced by the surviving entity during two
(2) year period, McFarland shall be entitled to payment of a severance benefit
in an amount equal to fifty percent (50%) of his then current annual salary;
provided, however, that if, on the first business day immediately preceding the
effective time of such merger or other corporate reorganization, the Bank's
total assets equal $200 million or greater, then McFarland shall be entitled to
payment of a severance benefit in an amount equal to one hundred percent (100%)
of his then current annual salary.

                  5.       Effect of Termination. In the event of the
termination of this Agreement for any reason, McFarland shall be entitled to the
salary and bonus, if any, earned by McFarland prior to the date of termination
as provided for in this Agreement (except that McFarland shall not be entitled
to any bonus in the event his employment is terminated for cause as provided in

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Paragraph F. l above), computed pro rata up to and including that date; but
McFarland shall be entitled to no further compensation for services rendered
after the date of termination, except as provided in Paragraph F.4 above
regarding merger or other corporation reorganization.

         G.       GENERAL PROVISIONS

                  1.       Trade Secrets. During the Term, McFarland will have
access to and become acquainted with what McFarland and Bank acknowledge are
trade secrets; to wit, knowledge or data concerning the Bank, including its
operations and methods of doing business, and the identity of customers of the
Bank, including knowledge of their financial condition and their financial
needs. McFarland shall not disclose any of the aforesaid trade secrets, directly
or indirectly, or use them in any way, either during the Term or for a period of
two (2) years after the termination of this Agreement, except as required in the
course of McFarland's employment with the Bank.

                  2.       Indemnification. To the extent permitted bylaw,
applicable statutes and the Bylaws or resolutions of the Bank in effect from
time to time, the Bank shall indemnify McFarland against liability or loss
arising out of McFarland's actual or asserted misfeasance or non-feasance in the
performance of McFarland' duties or out of any actual or asserted wrongful act
against, or by, the Bank, including but not limited to judgments, fines,
settlements, and expenses incurred in the defense of actions, proceedings, and
appeals therefrom. However, the Bank shall have no duty to indemnify McFarland
with respect to any claim, issue, or matter as to which McFarland has been
adjudged to be liable to the Bank in the performance of his duties, unless and
only to the extent that the court in which such action was brought shall
determine upon application that, in view of all of the circumstances of the
case, McFarland is fairly and reasonably entitled to indemnification for the
expenses which such court shall determine. The Bank shall endeavor to apply for
and obtain Directors and Officers Liability Insurance to indemnify and insure
the Bank and McFarland from and against the aforesaid liabilities. The
provisions of this Paragraph shall apply to the estate, executor, administrator,
heirs, legatees, or devisees of McFarland.

                  3.       Return of Documents. McFarland expressly agrees that
all manuals, documents, files, reports, studies, instruments, or other materials
used and/or developed by McFarland during the Term are solely the property of
the Bank, and that McFarland has no right, title, or interest therein. Upon
termination of this Agreement, McFarland or McFarland's representative shall
promptly deliver possession of all of said property to the Bank in good
condition.

                  4.       Notices. All notices, demands, or other
communications hereunder shall be in writing and shall be delivered in person
(professional courier acceptable); or by United States mail, certified or
registered, postage prepaid, with return receipt requested; or by facsimile
transmission; or otherwise actually delivered, to the addresses for the parties
appearing at the inception of this Agreement. The persons or addresses to which
mailings or deliveries shall be made may change from time to time by notice
given pursuant to the provisions of this Paragraph G.5. Any notice, demand, or
other communication given pursuant to this Agreement shall be deemed to have
been given on the date actually delivered, if delivered in person, three (3)
days

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following the date mailed, if delivered by U.S. mail, or upon written
confirmation of transmission, if delivered by facsimile.

                  5.       Review by Counsel. McFarland represents and warrants
to the Bank that he has had this Agreement reviewed by independent legal counsel
of his choice, or if he has not, that he has had the opportunity to do so, and
hereby waives any claim, objection,- or defense on the grounds that this
Agreement has not been reviewed by legal counsel of his choice.

                  6.       California Law. This Agreement is to be governed by
and construed in accordance with the laws of the State of California.

                  7.       Captions and Paragraph Headings. Captions and
paragraph headings used herein are for convenience only and are not a part of
this Agreement and shall not be used in construing it.

                  8.       Invalid Provisions. Should any provision of this
Agreement for any reason by declared invalid, void, or unenforceable by a court
of competent jurisdiction, the validity and binding effect of any remaining
portion shall not be affected, and the remaining portions of this Agreement
shall remain in full force and effect as if this Agreement had been executed
with said provisions eliminated.

                  9.       Entire Agreement. This Agreement contains the entire
agreement of the parties. It supersedes any and all other agreements, either
oral or in writing, between the parties hereto with respect to the employment of
McFarland by the Bank. Each party to this Agreement acknowledges that no
representations, inducements, promises, or agreements, oral or otherwise, have
been made by any party, or anyone acting on behalf of any party, which are not
embodied herein, and that no other agreement, statement, or promise not
contained in this Agreement shall be valid or binding. This Agreement may not be
modified or amended by oral agreement, but only by an agreement in writing
signed by both the Bank and McFarland.

                  10.      Receipt of Agreement. Each of the parties hereto
acknowledge that he has read this Agreement in its entirety and does hereby
acknowledge receipt of a fully executed copy thereof. A fully executed copy
shall be an original for all purposes, and is a duplicate original.

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         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

                                     SOUTHWEST COMMUNITY BANK

                              By:    /s/ Frank J. Mercardante
                                     -------------------------------------------
                                     Frank J. Mercardante
                                     President and Chief Executive Officer

                                     McFARLAND

                                     /s/ Stuart F. McFarland
                                     -------------------------------------------
                                     STUART F. McFARLAND

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Exhibit 10.8