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                                                                    EXHIBIT 10.7

                                 LIFE INSURANCE
                      ENDORSEMENT METHOD SPLIT DOLLAR PLAN
                                    AGREEMENT

Insurer/Policy Number:          Beneficial Life Insurance  #BL2103238
                                Jefferson Pilot Insurance  #JP5195818
                                Massachusetts Mutual Life
                                Insurance                  #0045169

Bank:                           Southwest Community Bank

Insured:                        Frank J. Mercardante

Relationship of Insured to Bank: Executive Officer

Date:

The respective rights and duties of the Bank, the Mercardante 2001 Irrevocable
Trust (the "Trust") and the Insured in the above policy(ies) (the "Policy" or
Policies) shall be as follows:

I.       DEFINITIONS

         Refer to the Policy provisions for the definition of all terms in this
Agreement.

II.      POLICY TITLE AND OWNERSHIP

         Title and ownership shall reside in the Bank for its use and for the
         use of the Trust all in accordance with this Agreement. The Bank alone
         may, to the extent of its interest, exercise the right to borrow or
         withdraw the Policy cash values. Where the Bank and the Trust, with the
         consent of the Insured, mutually agree to exercise the right to
         increase the coverage under the subject split dollar Policy, then, in
         such event, the rights, duties and benefits of the parties to such
         increased coverage shall continue to be subject to the terms of this
         Agreement.

III.     BENEFICIARY DESIGNATION RIGHTS

         The Insured shall have the right and power to require the Bank to
         designate a beneficiary or beneficiaries to receive the proceeds
         payable upon the death of the Insured, subject to any right or interest
         the Bank may have in such proceeds, as provided in this Agreement.
         Pursuant to said right, the Insured irrevocably directs the Bank and
         the Bank agrees to designate the Trust as beneficiary of the Policy.
         Said designation shall be irrevocable and thus may not be changed by
         anyone, except in the event the Agreement terminates as provided under
         Article X herein and the Policy is not assigned to the Trust.

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IV.      PREMIUM PAYMENT METHOD

         The Bank shall pay an amount equal to the planned premiums and any
         other premium payments that might become necessary to maintain the
         Policy in force.

V.       TAXABLE BENEFIT

         Annually the Insured will receive additional compensation equal to the
         assumed cost of insurance as required by the Internal Revenue Service
         plus the amount of any taxes paid and taxes on taxes paid (collectively
         "Taxes") related to the receipt of the benefit ("gross up"). This
         amount shall not exceed $8,620 per year. For example:

         If the taxable income is $10,000 and the highest combined marginal
         Federal and California income tax bracket plus FICA taxes and the
         Medicare tax is 40%, then the Taxes would be $10,000 multiplied by 40%
         ($4,000) divided by .60 = $6,667. The Bank (or its administrator) will
         report to the Insured the amount of imputed income received each year
         on Form W-2 or its equivalent.

VI.      DIVISION OF DEATH PROCEEDS

         Subject to Paragraph VII herein, the division of the death proceeds of
         the Policy is as follows: ,

         1.       If death occurs on or before the attainment of age sixty-five
                  (65), the Trust shall be entitled to an amount equal to the
                  lesser of $1,820,000, or one hundred percent (100%) of the net
                  at risk insurance portion of the proceeds. If death occurs
                  after age sixty-five (65) but on or before age seventy (70),
                  the Trust shall be entitled to the lesser of $1,400,000, or
                  one hundred percent (100%) of the net at risk insurance
                  proceeds. If death occurs after age seventy (70) but on or
                  before age eighty (80), the Trust shall be entitled to the
                  lesser of $980,000, or one hundred percent (100%) of the net
                  at risk insurance proceeds. If death occurs after age eighty
                  (80), the Trust shall be entitled to the lesser of $560,000,
                  or one hundred percent (100%) of the net at risk insurance
                  proceeds. The net at risk insurance portion is the total
                  proceeds less the cash value of the Policy.

         2.       The Bank and the Trust shall share in any interest due on the
                  death proceeds on a pro rata basis in the ratio that the
                  proceeds due the Bank and the Trust, respectively, bears to
                  the total proceeds, excluding any such interest.

         3.       In the event that the Policy is terminated other than as a
                  result of (a) a termination of this Agreement pursuant to
                  paragraph X or (b) any intentional act of the Insured which
                  results in the termination of the Policy, then the Bank shall
                  pay to the Trust an amount which will provide a total
                  after-tax death benefit equal to the benefit that the Insured
                  would have received if the Policy had not been terminated.

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         4.       In the event that the Policy is terminated other than as a
                  result of (a) a termination of this Agreement pursuant to
                  paragraph X or (b) any intentional act of the Insured which
                  results in the termination of the Policy, then the Bank shall
                  pay to the trust an amount which will provide a total
                  after-tax death benefit equal to the benefit that the Insured
                  would have received if the Policy had not been terminated.

VII.     DIVISION OF CASH SURRENDER VALUE

         The Bank shall at all times be entitled to an amount equal to the
         Policy's cash value, as that term is defined in the Policy, less any
         Policy loans and unpaid interest or cash withdrawals previously
         incurred by the Bank and any applicable Policy surrender charges. Such
         cash value shall be determined as of the date of surrender of the
         Policy or death of the Insured as the case may be

VIII.    PREMIUM WAIVER

         If the Policy contains a premium waiver provision, any such waived
         amounts shall be considered for all purposes of this Agreement as
         having been paid by the Bank.

IX.      RIGHTS OF PARTIES WHERE POLICY ENDOWMENT OR ANNUITY ELECTION EXISTS

         In the event the Policy involves an endowment or annuity element, the
         Bank's right and interest in any endowment proceeds or annuity benefits
         shall be determined under the provisions of this Agreement by regarding
         such endowment proceeds or the commuted value of such annuity benefits
         as the Policy's cash value. Such endowment proceeds or annuity benefits
         'shall be treated like death proceeds for the purposes of division
         under this Agreement.

X.       TERMINATION OF AGREEMENT

         This Agreement shall terminate at the option of the Bank following
         thirty (30) days written notice to the Insured and the Trust upon the
         happening of any one of the following:

         1.       The Insured's right to receive benefits under that certain
                  Executive Supplemental Compensation Agreement effective as of
                  October 17, 2001 shall terminate for any reason other than the
                  Insured's death, or

         2.       The Insured shall be discharged from service with the Bank for
                  cause. The term "for cause" shall mean:

                           (a)      The Insured's deliberate violation of (i)
any state or federal banking or securities laws, or of the Bylaws, rules,
policies or resolutions of the Employer, or (ii) of the rules or regulations of
the California Department of Financial Institutions, the Federal Deposit
Insurance Corporation, the Federal Reserve Board of Governors, the Office of the
Comptroller of the Currency or any other regulatory agency or governmental
authority having jurisdiction over the Bank, which has a material adverse
financial effect upon the Bank; or

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                           (b)      The Insured's conviction of (i) any felony
or (ii) a crime involving moral turpitude or a fraudulent or dishonest act
which, in each case, has a material adverse financial effect on the Employer.

         Upon such termination, the Trust shall have a ninety (90) day option to
         receive from the Bank an absolute assignment of the Policy in
         consideration of a cash payment to the Bank, whereupon this Agreement
         shall terminate. Such cash payment shall be an amount equal to the
         Policy's cash value, as that term is defined in the Policy, and shall
         not take into account the amount of any premiums that have been paid by
         the Bank.

         Should the Trust fail to exercise this option within the prescribed
         ninety (90) day period, the Trust agrees that all of its rights,
         interest and claims in the Policy shall terminate as of the date of the
         termination of this Agreement.

         Except as provided above, this Agreement shall terminate upon
         distribution of the death benefit proceeds in accordance with Paragraph
         VI above.

XI.      INSURED'S OR ASSIGNEE'S ASSIGNMENT RIGHTS

         Neither the Insured nor the Trust may assign to any individual, trust
         or other organization, any right, title or interest in the Policy nor
         any rights, options, privileges or duties created under this Agreement.

XII.     AGREEMENT BINDING UPON THE PARTIES

         This Agreement shall be binding upon the Insured, the Trust, and the
         Bank, and their respective heirs, successors, personal representatives
         and assigns, as applicable.

XIII.    NAMED FIDUCIARY AND PLAN ADMINISTRATOR

         The Bank is hereby designated the "Named Fiduciary" until resignation
         or removal by its Board of Directors. As Named Fiduciary, the Bank
         shall be responsible for the management, control, and administration of
         this Agreement as established herein. The Named Fiduciary may allocate
         to others certain aspects of the management and operations
         responsibilities of this Agreement, including the employment of
         advisors and the delegation of any ministerial duties to qualified
         individuals.

XIV.     FUNDING POLICY

         The funding Policy for this Agreement shall be to maintain the Policy
         in force by paying, when due, all premiums required.

XV.      CLAIM PROCEDURES

         Claim forms or claim information as to the subject Policy can be
         obtained by contacting The Benefit Marketing Group, Inc.
         (770-952-1529). When the Named Fiduciary has a claim which may be
         covered under the provisions described in the Policy it should contact
         the office named above, and they will either complete a claim form and
         forward it

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         to an authorized representative of the Insurer or advise the named
         F4duciary what further requirements are necessary. The Insurer will
         evaluate and make a decision as to payment. If the claim is payable, a
         benefit check will be issued to the Named Fiduciary.

         In the event that a claim is not eligible under the Policy, the Insurer
         will notify the Named Fiduciary of the denial pursuant to the
         requirements under the terms of the Policy. If the Named Fiduciary is
         dissatisfied with the denial of the claim and wishes to contest such
         claim denial, it should contact the office flamed above and they will
         assist in making inquiry to the Insurer. All objections to the
         Insurer's actions should be in writing and submitted to the office
         named above for transmittal to the Insurer.

XVI.     GENDER

         Whenever in this Agreement words are used in the masculine or neuter
         gender, they shall be read and construed as in the masculine, feminine
         or neuter gender, whenever they should so apply.

XVII.    INSURANCE COMPANY NOT A PARTY TO THIS AGREEMENT

         The Insurer shall not be deemed a party to this Agreement, but will
         respect the rights of the parties as set forth herein upon receiving an
         executed copy of this Agreement. Payment or other performance in
         accordance with the Policy provisions shall fully discharge the Insurer
         from any and all liability.

IN WITNESS WHEREOF, the Insured and a duly authorized Bank officer have signed
this Agreement as of the above written date.

SOUTHWEST COMMUNITY BANK                          INSURED

/s/ Howard B. Levenson                            /s/ Frank J. Mercardante
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Howard B. Levenson                                Frank J. Mercardante
Chairman

THE MERCARDANTE 2001
IRREVOCABLE TRUST

By
   _________________________________
   Trustee

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         IRREVOCABLE BENEFICIARY DESIGNATION FORM

NAME

The Mercardante 2001 Irrevocable Trust

By _________________________________

Southwest Community Bank

By:  /s/ Howard B. Levenson
     -------------------------------
     Howard B. Levenson
     Chairman

Exhibit 10.7