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                            EMPLOYMENT AGREEMENT

     THIS EMPLOYMENT AGREEMENT is made this 7th day of July, 1998, between 
CHANNEL ISLANDS BANK, a California banking corporation with its principal 
office at 300 Esplanade, Suite 110, Oxnard, California 93030 (hereinafter 
"Bank"), and Thomas E. Anthony (hereinafter "Executive") whose present 
residence address is 94 San Bernardino Avenue, Ventura, California 93004.

                            W I T N E S S E T H

     WHEREAS, the Bank is a corporation organized for the purpose of carrying 
on the business of banking and has been granted authority to conduct the 
business of a bank by the California Commissioner of Financial Institutions 
(the "Commissioner"); and

     WHEREAS, Bank desires to avail itself of the skill, knowledge and 
experience of Executive in order to insure the successful management of its 
business; and

     WHEREAS, the parties hereto desire to specify the terms of Executive's 
employment by Bank as its Senior Vice President and Senior Lending Officer in 
this written agreement which supersedes all prior agreements, whether written 
or oral; and

     WHEREAS, the employment, the duration thereof, the compensation to be 
paid to Executive, termination and other terms and conditions of employment 
provided in this Agreement were duly fixed, stated, approved and authorized 
for and on behalf of the Bank by action of its Board of Directors at a 
meeting held on June 18, 1998, at which meeting a quorum was present and 
voted.

     NOW, THEREFORE, in consideration of the mutual covenants hereinafter 
set forth, the sufficiency of which is acknowledged, the parties hereto 
covenant and agree as follows:

     A.  TERM OF EMPLOYMENT

     1.  TERM.  Subject to all necessary regulatory approvals, Bank hereby 
employs Executive, and Executive hereby accepts employment with Bank, for the 
period (the "Term") commencing June 18, 1998 (the "Effective Date"), through 
December 31, 1999, subject however to prior termination as hereinafter 
provided. Where used herein, "Term" shall refer to the entire period of the 
employment of Executive by Bank hereunder, whether for the period provided 
above, or whether terminated earlier as hereinafter provided.


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     B.  DUTIES OF EXECUTIVE

     1.  DUTIES.  Executive's duties under this Employment Agreement include 
all ordinary and reasonable duties customarily performed by the full-time 
Senior Lending Officer of a commercial banking institution in California, 
subject to the powers by law vested in the Board of Directors of the Bank, in 
the Bank's shareholders and the Bank's President and Chief Executive Officer. 
Executive shall render his services to the Bank and shall exercise such 
corporate responsibilities as Executive may be directed by the Board of 
Directors and the Bank's President and Chief Executive Officer, and Executive 
shall perform his duties faithfully, diligently and to the best of his 
ability, consistent with the highest and best standards of the banking 
industry and in compliance with applicable laws and the Bank's Articles of 
Incorporation and Bylaws. Executive shall be a member of certain committees 
of the Board as determined by the Board and Executive.

     2.  CONFLICTS OF INTEREST.  Executive expressly agrees as a condition to 
the performance by Bank of its obligations herein that during the term of 
this Agreement and of any renewals hereof, he will not, directly or 
indirectly, render any services of an advisory nature or otherwise to or 
become employed by or participate or engage in any business competitive with 
any businesses of the Bank, without the prior written consent of the Bank, 
however, that nothing herein shall prohibit Executive from owning stock or 
other securities of a competitor which are relatively insubstantial to the 
total outstanding stock of such competitor, and so long as he in fact does 
not have the power to control or direct the management or policies of such 
competitor and does not serve as a director or officer of, and is not 
otherwise associated with, any competitor except as consented to by the Bank. 
Nothing contained herein shall preclude substantially passive investments by 
Executive during the Term which may require nominal amounts of his time, 
energies and interest.

     3.  PERFORMANCE.  Except as provided in paragraph G.2. herein, Executive 
after the Effective Date shall devote substantially his full energies, 
interests, abilities and productive time to the business of the Bank. 
Executive shall at all times loyally and conscientiously perform all of these 
duties and obligations hereunder and shall at all times strictly adhere to 
and obey, and instruct and require all those who work under and with him 
strictly to adhere and obey, all applicable federal and state laws, statutes, 
rules and regulations to the end that the Bank shall at all times be in full 
compliance with such laws, statutes, rules and regulations.

     C.  COMPENSATION

     1.  SALARY.  In consideration of the performance by Executive of all of 
his obligations under this Agreement, the Bank agrees to pay Executive during 
the Term


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hereof a base salary of $95,258.89 per year from the date of commencement of 
this Agreement for each year of the Term. Subsequent annual compensation 
amounts will be negotiated in good faith by the parties hereto, with such 
subsequent annual compensation to be not less than $95,258.89 per year. Such 
salary shall be paid semi-monthly and the Bank shall withhold such taxes and 
other amounts as required by law or policy.

     2.  BONUSES.  During the term of this Agreement, Executive may receive 
such bonuses, if any, as the Board of Directors in its sole discretion shall 
determine.

     D.  EXECUTIVE BENEFITS

     1.  VACATION.  Executive shall be entitled to a vacation each year 
during the Term, which vacation shall be four (4) weeks per year, provided 
however, that each year of the Term, Executive is required to and shall take 
at least two (2) weeks of said vacation (the "Mandatory Vacation"), which 
shall be taken consecutively. Executive further agrees that he will not take 
more than two (2) weeks of vacation consecutively, and that he will not take 
any vacation at times which would be detrimental to the interests of the Bank.

     2.  AUTOMOBILE.  Until the Board of Directors of the Bank changes its 
policies, the Bank shall provide Executive use of a full-size automobile and 
the Bank shall pay (a) all insurance, gas and maintenance expenses of such 
automobile, and (b) any expenses such automobile which are paid by the Bank 
and which are for the personal use of the automobile by Executive shall be 
taxable as income to Executive. Executive agrees to conform to any policy 
changes made by the Board of Directors of the Bank regarding use of 
automobiles.

     3.  GROUP MEDICAL AND LIFE INSURANCE BENEFITS.  The Bank shall provide 
for Executive and Executive's spouse, at the Bank's expense, participation in 
medical, dental and vision programs in existence at the Bank, and provide 
Executive accident and health, long term disability and life insurance 
benefit programs in existence at the Bank. 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 Executive for any 
breach of this paragraph shall be limited to the amount of premiums payable 
by the Bank to obtain the coverage contemplated herein.

     4.  STOCK OPTIONS.  The Bank agrees to grant an incentive stock option 
under its current stock option plan to Executive in the amount of 5,000 
shares with vesting 20% immediately and the remainder equally over the next 
four years at an exercise price of $20.00 per share.

     E.  REIMBURSEMENT FOR BUSINESS EXPENSES


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     Executive shall be entitled to reimbursement by the Bank for any 
ordinary and necessary business expenses incurred by Executive in the 
performance of Executive's duties and in acting for the Bank during the Term, 
which type 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 deductible compensation to Executive; and

     (b) Executive 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 Executive.

     F.  TERMINATION

     Executive acknowledges the at-will nature of his employment with the 
Bank and such employment may be terminated for any reason or for any cause, 
as more full described herein. Notwithstanding any and all other provisions 
of this Agreement to the contrary, Executive's employment hereunder may be 
terminated;

     1.  WITHOUT CAUSE.  If Executive is terminated by the Board of Directors 
in its sole and absolute discretion without cause, or if such termination 
occurs during the Term and during the Term the Bank sells stock representing 
more than 25% of the voting power of the Bank then outstanding, to another 
corporation or person, or the Bank enters into a plan of dissolution or 
liquidation of the Bank, or consummates a plan of reorganization, merger or 
consolidation of the Bank with one or more corporations, as a result of which 
the Bank is not the servicing corporation, or upon the sale of all or 
substantially all the assets of the Bank to another corporation, and upon 
such event, such other corporation or person requires Executive to be 
replaced, Executive shall receive severance payment in the amount of six (6) 
months of the Executive's then current annual salary in full and complete 
satisfaction of any and all rights which Executive may enjoy hereunder other 
than the right, if any, to exercise any of the Options vested prior to such 
termination.

     2.  DISABILITY OR DEATH.  Upon Executive's physical or mental disability 
to continue his duties hereunder as the Senior Vice President and Senior 
Lending Officer of the Bank, or upon Executive's death. For purposes of this 
Agreement, physical or mental disability shall be defined as Executive being 
unable to fully perform under this Agreement for a continuous period of 60 
days.


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     3.  FOR CAUSE.  The Bank may terminate this Agreement without any 
further obligation or liability whatsoever to Executive, if:

           (i) Executive engages in misconduct or is negligent in the 
performance of his material duties hereunder; or

          (ii) Executive is convicted of or pleads guilty or nolo contendere 
to any felony, or is convicted of or pleads guilty or nolo contendere to any 
misdemeanor involving moral turpitude; or

         (iii) Bank is required to remove or replace Executive by formal 
order or formal or informal instruction, including a requested consent order 
or agreement, from the Commissioner or Federal Deposit Insurance Corporation 
or any other regulatory authority having jurisdiction; or

          (iv) Executive has failed to perform or habitually neglected 
Executive's duties; or

           (v) Executive has failed to follow any written policy of the Board 
of Directors or any resolutions of the Board adopted after commencement of 
the Term adopted at a duly called meeting; or

          (vi) Executive has engaged in any activity which materially 
adversely affects Bank's reputation in the Community; or

     Any termination under this paragraph 3 shall not prejudice any remedy 
which Bank may otherwise have at law, in equity, or under this Agreement.


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     G.  GENERAL PROVISIONS

     1.  TRADE SECRETS.  During the Term, Executive will have access to and 
become acquainted with what Executive and the Bank acknowledge are trade 
secrets, to wit, knowledge or data concerning the Bank, including its 
operations and business, and the identity of customers of the Bank, including 
knowledge of their financial conditions therein financial needs, as well as 
their methods of doing business. Executive 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 one (1) year after the termination 
of this Agreement, except as required in the course of Executive's employment 
with the Bank.

     2.  COVENANT NOT TO COMPETE.  Executive hereby covenants and agrees 
that for any period during which Executive receives any salary from the Bank 
and for a one (1) year period following any termination of Executive from the 
Bank, Executive shall not solicit any customers or employees of the Bank to 
move their banking or employment relationship from the Bank.

     In the event of a merger, where Bank is not the surviving corporation, 
or in the event of a consolidation, in the event of a transfer of all or 
substantially all of the assets of Bank, or in the event that the majority of 
the Bank's Board of Directors, as it exists as of the date of this Agreement, 
does not have control, the Executive shall be unconditionally released from 
all of his duties and obligations under this paragraph.

     3.  INDEMNIFICATION.  To the extent permitted by law, applicable 
statutes, the Bylaws or resolutions of the Bank in effect from time to time, 
the Bank shall indemnify Executive against liability or loss arising out of 
Executive's actual or asserted misfeasance or nonfeasance in the performance 
of Executive's duties or out of any actual or asserted wrongful act against, 
or by, the Bank including but not limited to judgments, fines, settlements 
and advancement of expenses incurred in the defense of actions, proceedings 
and appeals therefrom. The Bank shall endeavor to obtain Directors and 
Officers Liability Insurance to indemnify and insure the Bank and Executive 
from and against the aforesaid liabilities. The provisions of this paragraph 
shall apply to the estate, executor, administrator, heirs, legatees or 
devisees of Executive.

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


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     NOTICES.  Any notice, request, demand or other communication required or 
permitted hereunder shall be deemed to be properly given when personally 
served in writing, when deposited in the United States mail, postage prepaid, 
or when communicated to a public telegraph address appearing at the beginning 
of this Agreement. Either party may change its address by written notice in 
accordance with this paragraph.

     6.  CALIFORNIA LAW.  This Agreement is to be governed by and construed 
under 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 be declared invalid, the validity and binding effect of any remaining 
portion shall not be affected, and the remaining portion of this Agreement 
shall remain in full force and effect as if this Agreement had been executed 
with said provision 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 
Executive 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 the Bank and Executive.

     10. RECEIPT OF AGREEMENT.  Each of the parties hereto acknowledges 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.

     11. ARBITRATION.  Any controversy or claim arising out of, or relating 
to this Employment Agreement or the breach thereof, shall be settled by 
arbitration in the County of Ventura, State of California, in accordance with 
the rules of the American Arbitration Association, and a judgment upon the 
award rendered may be entered is any court having jurisdiction thereof.

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


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                                        CHANNEL ISLANDS BANK


                                        By  /s/ Joseph L. Priske
                                            -----------------------------
                                                Joseph L. Priske
                                                Chairman of the Board


EXECUTIVE

/s/ Thomas E. Anthony
-----------------------------
Thomas E. Anthony


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