<PAGE>   1


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

                                  FORM 10-KSB

[X]    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
       EXCHANGE ACT OF 1934
                       For the fiscal year ended: December 31, 1996
                                          or
[ ]    TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
       ACT OF 1934
                       For the transition period from _____ to _____

                            Commission file number:   0-27938

                                COLUMBIA BANCORP
                 (Name of small business issuer in its charter)


 <TABLE>
     <S>                                                                            <C>
              Oregon                                                                      93-1193156
     (State of incorporation                                                          (I.R.S. Employer
                                                                                       Identification No.)
</TABLE>
                             316 East Third Street
                           The Dalles, Oregon 97058
                    (Address of principal executive offices)

                   Issuer's telephone number:  (503) 298-6649

      Securities registered under Section 12(b) of the Exchange Act:  None

 Securities registered under Section 12(g) of the Exchange Act:  Common stock,
                                 no par value

      Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
YES   X    NO
    ----      ----

      Check if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-B in this form, and no disclosure will be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any amendment to
this Form 10-KSB. [X]

      The issuer's revenues for its most recent fiscal year were $17,159,603.

      The aggregate market value of the voting stock held by non-affiliates
computed by reference to the price at which the stock was sold, or the average
bid and asked prices of such stock, as of March 10, 1997 was $28,926,080.

      The number of shares outstanding of each of the issuer's classes of
common equity as of the latest practicable date: 2,255,641 shares of no par
value common stock on March 10, 1997.

                      DOCUMENTS INCORPORATED BY REFERENCE

      Part I and Part II incorporate by reference to the issuer's Annual Report
to Shareholders for the fiscal year ended December 31, 1996.  Part III is
incorporates by reference the issuer's definitive proxy statement for the
annual meeting of shareholders to be held on April 17, 1997.

      Transitional Small Business Disclosure Format (Check one):
              Yes       ; No   X
                  -----      -----
<PAGE>   2
                                COLUMBIA BANCORP
                                  FORM 10-KSB
                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
PART I                                                                                                 PAGE
------                                                                                                 ----
<S>              <C>                                                                                   <C>
                 (Portions of Item 1 are incorporated by reference from Columbia
                      Bancorp's Annual Report to Shareholders)

Item 1.          Description of Business                                                               3 - 25

Item 2.          Description of Property                                                              26 - 27

Item 3.          Legal Proceedings                                                                      27

Item 4.          Submission of Matters to a Vote of Security Holders                                    28

PART II
-------
                 (Items 5, 6, 7 and 8 are incorporated by reference from Columbia
                      Bancorp's Annual Report to Shareholders)

Item 5.          Market for Common Equity and Related Stockholder Matters                               28

Item 6.          Management's Discussion and Analysis or Plan of Operation                              28

Item 7.          Financial Statements                                                                   28

Item 8.          Changes In and Disagreements With Accountants on
                      Accounting and Financial Disclosure                                               28

PART III
--------
                 (Items 9 through 12 are incorporated by reference from Columbia
                      Bancorp's definitive proxy statement for the annual meeting
                      of shareholders to be held on April 17, 1997)

Item 9.          Directors, Executive Officers, Promoters and Control Persons,
                      Compliance With Section 16(a) of the Exchange Act                                 28

Item 10.         Executive Compensation                                                                 28

Item 11.         Security Ownership of Certain Beneficial Owners and
                      Management                                                                        28

Item 12.         Certain Relationships and Related Transactions                                         29

Item 13.         Exhibits and Reports on Form 8-K                                                     29 - 30

SIGNATURES                                                                                            31 - 32
</TABLE>

                                       2

<PAGE>   3
ITEM 1.  DESCRIPTION OF BUSINESS

GENERAL

         COLUMBIA BANCORP.  Columbia Bancorp (Bancorp), an Oregon corporation,
is the parent corporation and holding company of Columbia River Banking Company
(Columbia), and Klickitat Valley Bank (Klickitat).

         Bancorp was incorporated on October 3, 1995 and became the holding
company of Columbia through Columbia's merger with a "phantom bank" subsidiary
established by Bancorp.  As a result of the merger, Bancorp acquired 100% of
the common stock of Columbia, and the shareholders of Columbia became
shareholders of Bancorp under a one-for-one exchange of shares.

         Effective June 13, 1996, Bancorp completed its acquisition of
Klickitat, making Klickitat the second wholly-owned bank subsidiary of Bancorp.
The business combination was accomplished through the exchange of 8.5 shares of
Bancorp common stock for each share of Klickitat common stock.

         As of February 28, 1997, Bancorp had 1,213 shareholders of record, and
2,255,641 shares of its common stock issued and outstanding.

         All data in this Annual Report on Form 10-KSB has been restated to
give retroactive effect to the acquisition of Klickitat.  In addition, all
share and per share information in years prior to 1996 has been restated to
give retroactive effect to various stock splits and stock dividends.

         COLUMBIA RIVER BANKING COMPANY.  Columbia is an independent,
full-service state-chartered community bank with headquarters in The Dalles,
Oregon.

         Columbia was originally incorporated under the laws of the State of
Oregon on or about June 8, 1976, and received its bank charter on June 11,
1976.  Effective January 1, 1995, Columbia merged with and into Juniper Banking
Company (Juniper), an Oregon state-chartered bank.  Columbia was the surviving
entity in the merger.

         Columbia has seven offices in Oregon.  It does business under the
assumed business name "Columbia River Bank" in Hood River, Maupin, and two
locations in The Dalles.  In Madras, Redmond, and Bend, Columbia does business
under the assumed business name "Juniper Banking Company."  Columbia's seven
offices serve the financial needs of businesses and individuals in four
counties stretching from Deschutes and Jefferson Counties, in the approximate
geographical center of the State of Oregon, to Wasco and Hood River Counties,
on the Columbia River in the north.

         KLICKITAT VALLEY BANK.  Klickitat is a state-chartered community bank
headquartered in Goldendale, Washington.  Klickitat was chartered by the State
of Washington and approved by the Federal Deposit Insurance Corporation on
August 26, 1968.  It operates a branch in White Salmon, Washington.





                                       3
<PAGE>   4

ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

         In December of 1996 the Board of Directors of Bancorp approved the
merger of Klickitat into Columbia, with Columbia to be the surviving bank and
sole subsidiary of Bancorp.  The regulatory approval process was complete in
February 1997, and the merger became effective on March 1, 1997.  The two
former branches of Klickitat shall continue to do business under the "Klickitat
Valley Bank" name.  The Board of Directors of Bancorp believes this merger will
result in streamlined financial reporting, greater management efficiencies and
enhanced opportunities for Klickitat employees.  The discussion in this Form
10-KSB of Bancorp's two subsidiaries is for the pre-merger period ending
December 31, 1996.

BUSINESS OF COLUMBIA AND KLICKITAT

         Both banks provide a broad range of depository and lending services to
commercial, industrial and agricultural enterprises, governmental entities, and
individuals.  Columbia and Klickitat direct their deposit taking and lending
activities primarily to the communities in which their branches are located.
The primary marketing focus is on small to medium-sized businesses and on
professionals in those communities.  Neither bank provides trust services.

         Commercial loans generally consist of secured credit lines, typically
renewed annually, used for the operations and working capital requirements of
business borrowers.

         Agricultural loans generally consist of operating lines used to
finance farm operations through the growing season.  Columbia's borrowers
include wheat, mint, seed, apple, cherry and pear growers and livestock
operations.  Klickitat borrowers include wheat, alfalfa, barley, and livestock
operations.  Agricultural loans also include term loans used to finance farm
equipment purchases.  Agricultural loans are subject to increased credit risks
from causes such as bad weather, crop failures, and fluctuations in crop
prices.

         Both banks make loans secured by commercial, farmland, and residential
property. Growth in the residential loan portfolio has been intentionally
limited to avoid exposure to increased interest rate risk on long-term fixed
rate loans.  Most of Columbia's residential real estate loans are made on
behalf of other lenders.

         Consumer loans generally consist of automobile loans, personal credit
lines, and borrowings under Columbia's VISA card program.

         The quality of its personal financial services and dedication to
customer service have enabled Bancorp's subsidiary banks to maintain a stable
and relatively low cost retail deposit base, while generating a substantial
volume of loans.  Total deposits increased from $158.9 million at December 31,
1995, to $178.7 million at December 31, 1996.  Net loans increased from $104.2
million at December 31, 1995, to $118.2 million at December 31, 1996.





                                       4
<PAGE>   5


ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

         Deposit accounts are insured to statutory limits by the Federal
Deposit Insurance Corporation (the FDIC).  Neither bank is a member of the
Federal Reserve System.  Columbia, through its Columbia River Bank Financial
Services division, markets stocks, mutual funds, and other investment and
insurance products to customers of Columbia and Klickitat as well as the public
through an arrangement with PrimeVest Financial Services Inc., a registered
securities broker-dealer.

I.       DISTRIBUTION OF ASSETS, LIABILITIES AND STOCKHOLDERS' EQUITY; INTEREST
         RATES AND INTEREST DIFFERENTIAL

         Net interest income.  For most financial institutions, the primary
component of earnings is net interest income.  Net interest income is the
difference between interest income, principally from loans and investment
securities portfolios, and interest expense, principally on customer deposits
and borrowings.  Changes in net interest income result from changes in
"volume," "spread," and "margin."  Volume refers to the dollar level of
interest-earning assets and interest-bearing liabilities.  Spread refers to the
difference between the yield on interest- earning assets and the cost of
interest-bearing liabilities. Margin refers to net interest income divided by
interest-earning assets and is influenced by the level and relative mix of
interest-earning assets and interest-bearing liabilities.

         During 1996, 1995 and 1994, Bancorp's average interest-earning assets
were $172.8 million, $156.4 million and $149.2 million, respectively.  During
these same years, Bancorp's net interest margin was 5.81%, 5.71% and 5.74%,
respectively.





                                       5
<PAGE>   6





Average balances and average rates earned and paid.  The following table sets
forth for 1996, 1995, and 1994 information with regard to average balances of
assets and liabilities, as well as total dollar amounts of interest income from
interest-earning assets and interest expense on interest-bearing liabilities,
resultant average yields or rates, net interest income, net interest spread,
net interest margin.

<TABLE>
<CAPTION>
                                                                          YEARS ENDED DECEMBER 31,
                                     ----------------------------------------------------------------------------------------------
                                                   1996                             1995                            1994
                                     -------------------------------  -------------------------------  ----------------------------
                                                 INTEREST   AVERAGE               INTEREST   AVERAGE              INTEREST  AVERAGE
                                      AVERAGE    INCOME OR  YIELD OR   AVERAGE    INCOME OR  YIELD OR   AVERAGE   INCOME OR YIELD OR
                                     BALANCE(1)   EXPENSE    RATES    BALANCE(1)   EXPENSE    RATES    BALANCE(1)  EXPENSE   RATES
                                     ----------  ---------  --------  ----------  ---------  --------  ----------  -------  -------
                                                                           (In thousands)
<S>                                   <C>        <C>        <C>       <C>          <C>        <C>      <C>         <C>      <C>
                  ASSETS
                  ------
Investment securities
  Taxable securities                  $ 34,781   $ 2,170     6.24%    $ 39,571     $ 2,201     5.56%   $ 43,918    $ 2,280   5.19%
  Nontaxable securities (2)             14,964     1,168     7.80       13,120         998     7.61      13,449      1,035   7.69
Federal funds sold                      11,182       589     5.27        6,666         343     5.14       4,262        159   3.74
Loans (3)                              111,841    11,855    10.60       97,087      10,612    10.93      87,609      9,098  10.39
                                      --------   -------    -----     --------     -------    -----      ------    -------  -----
      Total interest-earning
        assets/interest income         172,768    15,782     9.13      156,444      14,154     9.05     149,238     12,572   8.42
Cash and due from banks                 10,105                           8,678                            7,708
Premises and equipment, net              4,092                           3,714                            3,606
Reserve for loan losses                 (1,153)                         (1,026)                          (1,014)
Other assets                             2,249                           2,542                            2,133
                                      --------                        --------                         --------

      Total assets                    $188,061                        $170,352                         $161,671
                                      ========                        ========                         ========
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
Savings and interest-bearing
  demand deposits                     $ 90,062     2,967     3.29     $ 80,078       2,688     3.36    $ 84,303      2,353   2.79
Time deposits                           49,286     2,717     5.51       44,036       2,369     5.38      37,274      1,540   4.13
Borrowed funds                           1,073        61     5.66        2,632         159     6.05       2,164        106   4.92
                                      --------   -------    -----     --------     -------    -----    --------    -------  -----
      Total interest-bearing
        liabilities/interest
        expense                        140,421     5,745     4.09      126,746       5,216     4.12     123,741      3,999   3.23
Noninterest-bearing deposits            28,328                          24,398                           22,665
Other liabilities                        1,872                           3,559                            1,355
                                      --------                        --------                         --------
      Total liabilities                170,621                         154,703                          147,761
Shareholders' equity                    17,440                          15,649                           13,910
                                      --------   -------              --------     -------             --------    -------
      Total liabilities and
        shareholders' equity          $188,061                        $170,352                         $161,671
                                      ========                        ========                         ========
Net interest income                              $10,037                           $ 8,938                         $ 8,573
                                                 =======                           =======                         =======
Net interest spread                                          5.04%                             4.93%                         5.19%
                                                             ====                              ====                          ====
Interest expense to
  earning assets                                             3.33%                             3.33%                         2.68%
                                                             ====                              ====                          ====
Net interest margin                                          5.81%                             5.71%                         5.74%
                                                             ====                              ====                          ====

-----------------
</TABLE>
(1)  Average balances are based on daily averages.
(2)  Tax-exempt income has been adjusted to a tax-equivalent basis at a 34%
     rate.
(3)  Nonaccrual loans are included in the average balance.





                                       6
<PAGE>   7




ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

         Analysis of changes in interest rate differential.  The following
table shows the dollar amount of the increase (decrease) in Bancorp's interest
income and interest expense for the years indicated, on a tax-equivalent basis,
and attributes such dollar amounts to changes in volume and changes in interest
rates.  Changes attributable to the combined effect of volume and interest rate
changes, which were immaterial, have been allocated equally between interest
rate and volume.


<TABLE>
<CAPTION>
                                                             1996 VS. 1995                            1995 VS. 1994
                                                        CHANGE IN NET INTEREST                   CHANGE IN NET INTEREST
                                                             INCOME DUE TO                             INCOME DUE TO
                                                  --------------------------------     -------------------------------------
                                                  VOLUME        RATE        TOTAL       VOLUME         RATE          TOTAL
                                                  ------      --------    ---------     ------       --------      ---------


                 <S>                            <C>            <C>          <C>          <C>         <C>           <C>
                 Interest income:
                   Securities - taxable         $(266,425)     $ 235,569    $ (30,856)   $(225,602)  $146,800      $  (78,802)
                   Securities - tax-exempt        140,411         28,594      169,005      (25,333)   (10,922)        (36,255)
                   Federal funds sold             232,195         14,300      246,495       89,964     93,344         183,308
                   Loans                        1,612,731       (369,953)   1,242,778      984,294    529,229       1,513,523
                                                ---------      ----------   ---------     --------    -------       ---------
                       Total interest income    1,718,912        (91,490)   1,627,422      823,323    758,451       1,581,774
                                                ---------      ----------   ---------     --------    --------      ---------

                 Interest expense:
                   Savings and interest-
                     bearing demand deposits      335,148        (55,982)     279,166     (117,931)   453,046         335,115
                   Time deposits                  282,416         66,188      348,604      279,428    549,325         828,753
                   Borrowed funds                 (94,244)        (4,187)     (98,431)      23,002     29,693          52,695
                                                ---------      ---------    ---------    ---------  ---------       ---------
                        Total interest expense    523,320          6,019      529,339      184,499  1,032,064       1,216,563
                                                ---------      ---------    ---------    ---------  ---------       ---------
                 Net interest income           $1,195,592      $ (97,509)   $1,098,083    $638,824  $(273,613)      $ 365,211
                                               ==========      ==========   ==========    ========  =========       =========


</TABLE>

II.      INVESTMENT ACTIVITIES

         The objectives of Bancorp's investment portfolio are (i) to provide
liquidity to meet seasonal or other unexpected cash needs resulting from
declines in deposits or increases in loans and (ii) to provide an adequate rate
of return within the constraints of liquidity requirements.  Bancorp's policy
is to maintain a loan/deposit ratio of approximately 80%. Accordingly,
investment securities are a major source of Bancorp's revenues. Investments are
made by the Chief Executive Officer or the Chief Financial Officer of the
subsidiary bank, and are generally limited to investment grade securities.  The
banks do not actively trade securities and, as of December 31, 1996 and 1995,
approximately 80% and 83%, respectively, were designated as being
held-to-maturity.  The remaining investment securities are available-for-sale
to provide Bancorp with necessary liquidity or funds available for alternative
investments.





                                       7
<PAGE>   8
ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

         The following table provides the carrying values of Bancorp's
investment portfolio at the end of each of the last three years.  See Note 2 of
Notes to Consolidated Financial Statements for more information about
investment securities held at December 31, 1996, 1995, and 1994.

<TABLE>
<CAPTION>
                                                                                    DECEMBER 31,
                                                            -------------------------------------------------------------
                                                               1996                     1995                      1994
                                                            ----------               ----------                ----------
                                                                                   (In thousands)

                 <S>                                          <C>                       <C>                      <C>
                 U.S. Treasury securities                     $ 4,121                   $ 7,340                  $14,913
                 U.S. government agencies                      28,431                    21,169                   20,400
                 State and political subdivisions              15,351                    14,728                   12,672
                 Other securities                               2,609                     5,595                    7,694
                                                              -------                    ------                   ------
                   Total debt securities                       50,812                    48,832                   55,679

                 Equity securities                                972                       622                      551
                                                              -------                   -------                  -------

                   Total investment securities                $51,484                   $49,454                  $56,230
                                                               ======                    ======                   ======

</TABLE>
         The following table provides the amortized cost, market value,
maturities and weighted average yields of Bancorp's investment securities at
December 31, 1996:

<TABLE>
<CAPTION>
                                                                                                                WEIGHTED
                                                                  AMORTIZED                MARKET                AVERAGE
                 TYPE AND MATURITY                                  COST                   VALUE                YIELD (1)
                 -----------------                                ---------                -------              ---------
                 <S>                                              <C>                      <C>                    <C>
                 U.S. Treasury securities:
                    Due within one year                           $   902                  $   904                5.81%
                    Due after one but within five years             3,215                    3,196                5.97
                                                                   ------                   ------                ----
                          Total U.S. Treasury securities            4,117                    4,100                5.93
                                                                   ------                   ------                ----

                 U.S. government agencies:
                    Due within one year                             1,814                    1,814                5.47
                    Due after one but within five years            19,393                   19,284                6.37
                    Due after five but within ten years             5,331                    5,304                7.01
                    Due after ten years                             1,916                    1,900                7.30
                                                                   ------                   ------                ----
                          Total U.S. government
                            agencies                               28,454                   28,302                6.49
                                                                   ------                   ------                ----

</TABLE>




                                       8
<PAGE>   9
ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

<TABLE>
<CAPTION>
                                                                                                                 WEIGHTED
                                                                  AMORTIZED                MARKET                 AVERAGE
                 TYPE AND MATURITY                                  COST                   VALUE                 YIELD (1)
                 -----------------                                ---------               --------               ---------
                 <S>                                              <C>                     <C>                      <C>
                 State and political subdivisions:
                    Due within one year                           $  2,659                $  2,674                 5.77%
                    Due after one but within five years              8,340                   8,517                 6.61
                    Due after five but within ten years              3,952                   3,966                 7.40
                    Due after ten years                                400                     400                 7.74
                                                                    ------                 -------                 ----
                          Total states and political sub-
                            divisions                               15,351                  15,557                 6.70
                                                                    ------                  ------                 ----

                 Other securities:
                    Due within one year                              1,852                   1,861                 5.83
                    Due after one but within five years                756                     756                 6.45
                                                                   -------                 -------                 ----
                          Total corporate securities                 2,608                   2,617                 6.01%
                                                                   -------                 -------                 ====
                          Total debt securities                     50,830                  50,876                 6.49%
                                                                                                                   ====

                 Equity securities                                     972                     972
                                                                   -------                 -------

                          Total securities                         $51,502                 $51,548
                                                                    ======                  ======

</TABLE>
(1)      Weighted average yield on states and political subdivisions has been
         computed on a 34% tax-equivalent basis.

III.     LENDING ACTIVITIES

         Bancorp's subsidiary banks spread their lending among commercial,
agricultural, real estate, and consumer loans.  The interest rates charged for
the various loans made by the banks vary with the degree of risk, size, and
maturity of the loans, the borrower's depository relationship with the bank and
prevailing money market rates.  The bank's overall lending operations are
guided by its loan policy, which outlines the basic policies and procedures by
which lending operations are conducted.  Generally, the policy addresses loan
authority, underwriting and collateral requirements, terms, interest rate
considerations, and compliance with laws and regulations.

         Loan pricing decisions are based on an evaluation of risk, cost of
funds, operating and administrative costs, a reserve for loan losses, desired
profit margin, and other factors.  Loan risk is based in part on a risk rating
assigned to each loan.

         The banks sell loan participations to accommodate borrowers whose
financing needs exceed the bank's lending limit and to diversify risk.  The
banks occasionally purchase participations in loans from correspondent banks.





                                       9
<PAGE>   10

ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

         Most of Bancorp's loans are made to customers in the trade areas
served by the subsidiary bank's branch offices.  Underwriting standards are
designed to achieve a high quality loan portfolio, compliance with lending
regulations and the desired mix of loan maturities and industry concentrations.
Management further seeks to minimize credit losses by closely monitoring the
financial condition of its borrowers and the value of collateral.

         Loan portfolio composition.  The following table sets forth
information with respect to the composition of Bancorp's loan portfolio by type
of loan at December 31 for each of the last five years:
<TABLE>
<CAPTION>
                                                                                  DECEMBER 31,
                                                  ----------------------------------------------------------------------------
                                                    1996            1995             1994            1993             1992
                                                  --------        --------          -------         -------          -------
                                                                                 (In thousands)
                 <S>                              <C>             <C>               <C>             <C>              <C>
                 Commercial                        $26,485         $20,540          $16,475         $16,985          $13,519
                 Agricultural                       15,592          14,796           11,554          10,175            9,363
                 Secured by real estate
                   Commercial property              19,255          18,019           16,180          11,934           10,742
                   Farmland                          5,610           4,371            3,617           3,406            3,482
                   Construction                      4,613           2,873            2,998           3,034            2,568
                   Residential                      31,489          29,216           26,389          22,938           23,046
                   Home equity lines                 1,555           1,585            1,046             977              830
                                                  --------        --------          -------         -------          -------
                          Total real estate         62,522          56,064           50,230          42,289           40,668

                 Consumer                           13,776          13,325           12,729          12,530           10,622
                 Other                               1,148             737              295             413            1,621
                                                  --------        --------          -------         -------          -------
                          Total loans              119,523         105,462           91,283          82,392           75,793

                   Less deferred loan fees            (300)           (212)            (258)              -                -
                   Less reserve for loan              (995)         (1,072)            (955)           (992)            (843)
                                                  --------        --------          -------         -------          -------
                 losses

                 Loans receivable, net            $118,228        $104,178          $90,070         $81,400          $74,950
                                                  ========        ========          =======         =======          =======

</TABLE>
         Loan maturities and interest rate sensitivity.  The following table
presents the aggregate maturities of loans in each major category of Bancorp's
loan portfolio at December 31, 1996.  Actual maturities may differ from the
contractual maturities shown below as a result of renewals and prepayments.
<TABLE>
<CAPTION>
                                                                       DUE AFTER ONE                                TOTAL
                                                    DUE WITHIN          BUT WITHIN           DUE AFTER            LOANS BY
                 LOAN CATEGORY                       ONE YEAR           FIVE YEARS           FIVE YEARS           CATEGORY
                 -------------                     ------------          --------            ----------           --------
                                                                                (In thousands)
                 <S>                                  <C>                 <C>                  <C>                <C>
                 Commercial                           $16,459             $ 8,347              $ 1,679             $26,485
                 Agricultural                          14,071               1,249                  272              15,592
                 Secured by real estate
                   Commercial property                  4,178               8,073                7,004              19,255
                   Farmland                             1,842               2,084                1,684               5,610
                   Construction                         3,086               1,403                  124               4,613
                   Residential                          3,814               3,159               24,516              31,489
                   Home equity lines                      170                  12                1,373               1,555
                                                      -------             -------              -------              ------
                          Total real estate            13,090              14,731               34,701              62,522
                 Consumer                               5,023               7,017                1,736              13,776
                 Other                                    150                 750                  248               1,148
                                                      -------             -------              -------            --------

                 Total loans by maturity              $48,793             $32,094              $38,636            $119,523
                                                      =======             =======              =======            ========

</TABLE>




                                       10
<PAGE>   11
ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

         At December 31, 1996, $63.8 million (approximately 53%) of the loan
portfolio had fixed interest rates and $55.7 million (approximately 47%) had
variable interest rates.  Of the $70.7 million in loans that mature after one
year, a total of $53.1 million (75%) are fixed-rate loans, and a total of $17.6
million (25%) are variable-rate loans.

         Commercial loans.  As of December 31, 1996, commercial loans that are
not collateralized by real estate represent 22% of total loans.  Columbia and
Klickitat provide a wide range of commercial business loans, including lines of
credit for working capital and term loans for the acquisition of equipment and
other purposes.  Collateral generally includes equipment, accounts receivable
and inventory.  When and if warranted, loans may be made on an unsecured basis.

         At December 31, 1996, approximately 67% of the commercial loans had
floating or adjustable interest rates; the remaining 33% had fixed interest
rates. Operating lines of credit are payable on demand and generally subject to
annual renewal. Term loan maturities generally range from one to five years.
Commercial loans outstanding at December 31, 1996, were $26.5 million, compared
to $20.5 million at December 31, 1995.  Management believes the increase in
1996 was primarily a result of the ability of Klickitat and Columbia to respond
quickly to customers' needs.  At December 31, 1996, nonaccrual loans in this
category totaled $40,000; there were no restructured loans.

         Agricultural.  Agricultural loans represent 13% of the loan portfolio
at December 31, 1996.  Bancorp's subsidiary banks provide production lines of
credit, equipment financing, and term loans for capital improvements and
investments.  Collateral generally consists of crops, equipment, and inventory.
Loans will be granted on an unsecured basis when and if warranted.

         At December 31, 1996, approximately 88% of the agricultural loans had
floating or adjustable rates; the remaining 12% had fixed rates.  Operating
lines of credit are payable on demand and usually mature at the end of the
production year.  Term loan maturities generally range from two to five years.
Agricultural loans outstanding on December 31, 1996, were $15.6 million
compared to $14.8 million on December 31, 1995.  The increase was primarily a
result of marketing efforts and renewed or increased borrowings from
orchardists caused by three consecutive years of below average returns.  At
December 31, 1996, there were no nonaccrual or restructured loans in this
category.

         Real estate mortgage loans.  Real estate mortgage loans represent the
largest category of loans.  Real estate mortgage loans outstanding increased to
$62.5 million at December 31, 1996, from $56.1 million at December 31, 1995.
The increase was primarily a result of loans secured by residential real
estate.  Of the $62.5 million of real estate mortgage loans outstanding at
December 31, 1996, $19.2 million were made to commercial customers where the
collateral for the loans included the real estate occupied by the customers'
businesses. Therefore, many loans classified as real estate mortgage loans
could be characterized as commercial loans that are collateralized by real
estate.  Commercial real estate loans typically involve large loan balances to
single borrowers or groups of related borrowers.  These borrowers may be more
sensitive to changes in economic conditions than are residential loan
customers.  At December 31, 1996, there was $10,000 in nonaccrual loans, and no
restructured loans, in this category.





                                       11
<PAGE>   12
ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

         At December 31, 1996, $41.9 million (or approximately 67%) of the real
estate mortgage loans had fixed interest rates and $20.6 million (or
approximately 33%) had floating or adjustable interest rates.  Maturities of
real estate mortgage loans usually range from one to fifteen years.  Bancorp's
subsidiary bank's underwriting standards specify maximum loan-to-value ratios
for real estate loans: 80% for loans collateralized by owner-occupied
residences, 80% for other residential loans and for construction loans, and 75%
for commercial real estate loans.  Management believes that the current real
estate mortgage portfolio does not present a material risk of loan losses.

         Bancorp's subsidiary banks originate Small Business Administration
(SBA) commercial real estate loans on owner-occupied properties where the
maturities may be up to 20 years, and the loan-to-value ratio may reach 80% of
appraised value or cost, whichever is lower.  Up to 90% of the amount of these
loans is guaranteed or insured by an agency of the U.S. Government.  The
guaranteed portion of these loans is typically sold to secondary-market
investors.

         Bancorp's subsidiary banks are active in making residential real
estate loans, not only for the bank portfolio, but also on behalf of other
lenders.  Loans originated for other lenders are primarily made under an
arrangement with PHH US Mortgage Corporation (PHH) of Mount Laurel, New Jersey.
The banks process loan applications and related paperwork and then submit the
documentation to PHH. PHH then makes the lending decisions and funds and
services the loans.  For the year ended December 31, 1996, Bancorp's subsidiary
banks originated and sold 80 residential loans, receiving $86,487 in fee
income.

         Real estate construction loans.  Bancorp's subsidiary banks make
construction loans to individuals and contractors to construct single- family
primary residences and second homes.  These loans generally have maturities of
six to nine months.  Interest rates are typically adjustable, although
fixed-rate loans are also made under appropriate conditions.  This type of loan
is generally made only when permanent financing has been arranged.  It is each
bank's policy to limit its loans to contractors building houses on a
speculative basis, so that only one or two of these types of loans are
outstanding to any single borrower at any time, depending on the financial
condition of and prior lending experience with the contractor.

         Construction loans have many of the same risks that are present in
real estate mortgage loans and may present additional risks, such as
construction delays, cost overruns, and insufficient collateral.  At December
31, 1996, there were no nonaccrual loans or restructured loans in this
category.

         Consumer loans.  Consumer loans generally consist of automobile loans,
personal credit lines and borrowings under the VISA card program

         Consumer loans were $13.8 million at December 31, 1996, compared to
$13.3 million at December 31, 1995.  This increase was primarily due to
economic growth and an expanding customer base.  At December 31, 1996, there
was $2,000 in nonaccrual loans or restructured loans in this category.





                                       12
<PAGE>   13
ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

         Commitments and contingent liabilities.  In the ordinary course of
business, Bancorp's bank subsidiaries enter into various types of transactions
that include commitments to extend credit and standby letters of credit as
described in Note 9 to the Consolidated Financial Statements of Bancorp.
Bancorp applies the same credit standards to these commitments as it uses in
all its lending processes and has included these commitments in its lending
risk evaluations.  Collateral for these commitments may include cash,
securities, and/or real estate.

         Nonperforming assets.  The following table sets forth information with
respect to nonperforming assets as of the dates indicated:

<TABLE>
<CAPTION>
                                                                                             DECEMBER 31,
                                                                   ------------------------------------------------------------
                                                                     1996         1995         1994         1993        1992
                                                                   --------     --------     --------     --------    --------
                                                                                          (In thousands)
                 <S>                                               <C>          <C>           <C>          <C>           <C>
                 Nonperforming loans:
                   Nonaccrual loans                                  $ 52        $ 308        $  68         $  51        $ 148
                   Accruing loans past due 90 days or more             30           60          118            20           22
                   Restructured loans                                 -            -            -             -            -
                                                                    -----        -----        -----         -----        -----
                          Total nonperforming loans                    82          368          186            71          170
                   Other real estate owned                            -            -              5           457          712
                                                                    -----        -----         ----          ----         ----

                          Total nonperforming assets                $  82        $ 368        $ 191         $ 528        $ 882
                                                                     ====         ====         ====          ====         ====

                 Reserve for loan losses                             $995       $1,072         $955          $992         $843
                 Ratio of  total nonperforming  assets to  total     .04%         .21%         .12%          .33%         .63%
                 assets
                 Ratio  of total  nonperforming  loans  to total     .07%         .35%         .20%          .09%         .22%
                 loans
                 Ratio of reserve for loan losses to total non-
                   performing loans                                1,213%         291%         513%        1,397%         496%

</TABLE>
         Nonaccrual loans are loans on which interest income is no longer
accrued.  The accrual of interest on a loan is discontinued when, in the
opinion of management, the future collectibility of principal of interest is in
serious doubt or is expected to be substantially delayed.  Typically, loans are
classified as nonaccrual after 70 days of nonpayment.  Loans that are 70 days
past due are kept in the accruing category only if there is strong reason to
believe that loan payments will be made.  Additional interest income that would
have been earned in 1996 on nonaccrual loans was $10,991.

         All nonaccrual loans are considered to be impaired loans.  As of
January 1, 1995, the Financial Accounting Standards Board's Statements No. 114
"Accounting by Creditors for Impairment of a Loan" and No. 118 "Accounting by
Creditors for Impairment of a Loan - Income Recognition and Disclosures" was
adopted.  These pronouncements require that impaired loans be measured based on
the present value of expected future cash flows discounted at the loan's
effective interest rate or at the loan's market price or the fair value of the
collateral if the loan is collateral dependent.  The accrual of interest on
impaired loans is discontinued when, in management's opinion, the borrower may
be unable to meet payments as they become due.  When interest accrual is
discontinued, all unpaid accrued interest is reversed. Interest is subsequently
recognized only to the extent cash payments are received. The adoption of this
statement did not have a material effect on the consolidated financial
statements.





                                       13
<PAGE>   14
ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

         Restructured loans are those for which concessions have been granted
due to the borrower's weakened financial condition or other factors.  Such
concessions may include reduction of interest rates below rates otherwise
available to that borrower or deferral of interest or principal.  Interest on
restructured loans is accrued at the restructured rate when it is anticipated
that no loss of original principal will occur.  There were no restructured
loans at December 31, 1996 or 1995.

         Other real estate owned (OREO) consists of real estate acquired
through foreclosure or by a deed in lieu of foreclosure.  Properties in OREO
are carried at the lower of fair market value (less anticipated selling costs)
or the principal balance of the related loan.  Any excess of the loan balance
over fair value of the property is charged to the reserve for loan losses.
There was no OREO at December 31, 1996 or 1995.

         Analysis of the reserve for loan losses.  The reserve for loan losses
represents management's estimate of the losses inherent in the loan portfolio.
The reserve is based primarily on management's evaluation of the overall
quality and risk characteristics of the subsidiary bank's loan portfolio, which
is dependent upon numerous interrelated factors including present nonperforming
and delinquent loans, borrowers' perceived abilities to repay, value of
collateral, general and local economic conditions, and historical loan loss
experience.

         The Board of Directors of Bancorp's subsidiary banks reviews the
adequacy of the reserve for loan losses quarterly.  Although determination of
the adequacy of the reserve involves substantial subjective judgment based on
the analysis of the risk characteristics of the entire loan portfolio,
management also uses two quantitative methods to analyze the adequacy of the
reserve.  Under the first method, management assigns a specific percentage to
each nonperforming, substandard or doubtful loan in the loan portfolio to
calculate a total amount of average anticipated loan losses.  The second method
assesses a six-year historical loss ratio in the primary loan classifications
and compares the average to the existing reserve balance.  Bancorp's subsidiary
banks have initiated a risk rating system but sufficient data has not been
compiled from which to draw meaningful conclusions.  The amounts calculated by
the two quantitative methods are then compared to the reserve for loan losses
in evaluating the adequacy of the reserve.

         As a result of the decline in real estate market values in many parts
of the United States and the significant losses experienced by many financial
institutions, regulators have increasingly scrutinized loan portfolios and loss
reserves, particularly with respect to commercial and multi-family residential
real estate loans.  Management believes that the reserve for loan losses is
adequate to cover anticipated losses and is in accordance with generally
accepted accounting principles.  There can be no assurance, however, that
management will not decide to increase the reserve for loan losses or that
regulators will not require an increase to the reserve, either of which events
could adversely affect Bancorp's results of operations.  Further, there can be
no assurance that actual loan losses will not exceed the reserve.





                                       14
<PAGE>   15
ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

IV.      SUMMARY OF LOAN LOSS EXPERIENCE

         The following table sets forth information regarding changes in the
reserve for loan losses for each of the last five years:
<TABLE>
<CAPTION>
                                                                      AT OR FOR THE YEAR ENDED DECEMBER 31,
                                                           ------------------------------------------------------------------
                                                             1996          1995           1994           1993          1992
                                                           --------      --------       --------       --------      --------
                                                                                     (In thousands)
                 <S>                                      <C>            <C>            <C>            <C>            <C>
                 Loans at year-end                        $119,523       $105,462       $91,283        $82,392        $75,793
                                                           =======        =======        ======         ======         ======
                 Reserve for loan losses,
                   beginning of year                        $1,072         $  955        $  992         $  843         $  879
                 Charge-offs:
                   Real estate loans                            -              -             -              -              -
                   Agricultural                               (317)           (14)          (50)            -             (14)
                   Installment loans                           (21)           (16)          (19)           (13)           (21)
                   Credit card and related plans                (9)           (55)           (7)            -              (7)
                   Commercial and other                        (30)           (34)         (193)           (27)          (277)
                                                              ----           ----          ----           ----           -----
                          Total charge-offs                   (377)          (119)         (269)           (40)          (319)
                                                              ----           ----          ----           ----           ----

                 Recoveries:
                   Real estate loans                            -              -             -              -              10
                   Agricultural                                  7              7             1              2              4
                   Installment loans                            20             31             4             11              9
                   Credit card and related plans                -               3             5             -              -
                   Commercial and other                         26            107            19             18             28
                                                             -----          -----         -----          -----          -----
                          Total recoveries                      53            148            29             31             51
                                                              ----           ----          ----           ----           ----
                 Net loans recovered (charged-off)            (324)            29          (240)            (9)          (268)
                 Provision for loan losses                     247             88           203            158            232
                                                             -----          -----         -----          -----          -----

                 Reserve for loan losses at year-end         $ 995         $1,072         $ 955          $ 992          $ 843
                                                              ====          =====          ====           ====           ====
                 Ratio of net  recoveries (charge-off)
                   to average loans outstanding during
                   the period                                 (.29)%          .03%        (.27)%         (.01)%         (.36)%
                 Ratio of reserve for loan losses to
                   loans at year-end                           .83%          1.02%         1.05%          1.20%          1.11%

</TABLE>
         Anticipated loan losses are charged against the reserve for loan
losses when, in management's opinion, ultimate recovery is unlikely or when
bank examiners require a charge-off.  As the actual amount of loss with respect
to specific loans is often dependent upon future events (including liquidation
of collateral), management cannot accurately predict precisely what losses, if
any, will be sustained with respect to specific loans.  Historical experience
has also shown that, at any particular time, loan losses may exist in a loan
portfolio that have not yet been identified.  For these reasons, although
management analyzes specific loans in determining the adequacy of its reserve
for loan losses, it does not normally allocate the reserve to specific groups
or categories of loans.  The approximate anticipated amount of charge-offs
during 1997 by category is as follows (in thousands):

<TABLE>
                          <S>                                          <C>
                          Real estate loans                            $    0
                          Agricultural loans                               75
                          Installment loans                                30
                          Credit card and related plans                    20
                          Commercial and other                             50
                                                                         ----
                                  Total                                  $175
                                                                          ===

</TABLE>




                                       15
<PAGE>   16
ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

V.       DEPOSITS

         At December 31, 1996, Bancorp's subsidiary banks had approximately
23,900 deposit accounts.  Various types of deposit accounts are offered,
including interest-bearing and noninterest-bearing checking accounts, money
market type accounts, passbook and other savings accounts, and time
certificates ranging in maturity from 32 days to 10 years.  Deposit accounts
vary as to terms, with principal differences being the minimum balance
required, the time period the funds must remain on deposit and the interest
rate.  Unlike some other financial institutions, Bancorp's subsidiary banks
have never relied on brokered deposits.  Management believes that retail
deposit accounts are a more dependable and cost effective source of funds.  The
following table presents the average balances for each major category of
deposits and the weighted average interest rates paid for interest-bearing
deposits for the years ended December 31, 1996, 1995, and 1994:

<TABLE>
<CAPTION>
                                                       1996                        1995                        1994
                                                      AVERAGE                     AVERAGE                     AVERAGE
                                               ---------------------       ---------------------       ---------------------
                                                BALANCE         RATE        BALANCE         RATE        BALANCE         RATE
                                                -------         ----        -------         ----        -------         ----
                                                                                (In thousands)

                 <S>                           <C>             <C>         <C>             <C>         <C>             <C>
                 Noninterest-bearing demand     $28,328          -- %       $24,398          -- %       $22,665          -- %
                 Interest-bearing demand         24,850         1.95         21,341         3.04         21,573         1.88
                 Money market accounts           42,006         4.17         35,822         3.63         38,424         3.20
                 Other savings                   26,986         3.12         26,403         3.58         27,928         3.04
                 Time deposits                   45,506         5.50         40,547         5.31         33,652         4.51
                                                 ------         ----         ------         ----         ------         ----

                 Total                         $167,676        4.01%       $148,511        4.06%       $144,242        3.29%
                                                =======        ====         =======        ====         =======        ====

</TABLE>
         The following table shows the dollar amount and maturities of CDs that
had balances of $100,000 or more at December 31, 1996, 1995 and 1994:

<TABLE>
<CAPTION>
                                                                                             DECEMBER 31,
                                                                         -------------------------------------------------
                                                                           1996                 1995                1994
                                                                         --------             --------            --------
                                                                                         (In thousands)
                 <S>                                                      <C>                  <C>                  <C>
                 CDs $100,000 or over with remaining maturity:
                   Three months or less                                    $5,373               $6,813              $3,562
                   Over three months through six months                     4,008                5,012               2,957
                   Over six months through twelve months                    1,636                1,531                 647
                   Over twelve months                                       1,188                  581                 579
                                                                           ------               ------              ------

                                  Total                                   $12,205              $13,937              $7,745
                                                                           ======               ======               =====

</TABLE>




                                       16
<PAGE>   17
ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

VI.      RETURN ON EQUITY AND ASSETS

         The following table sets forth the return on assets and return on
equity for 1996, 1995 and 1994:

<TABLE>
<CAPTION>
                                                                                    FOR THE YEAR ENDED DECEMBER 31,
                                                                           -------------------------------------------------
                                                                              1996               1995                1994
                                                                           ----------         ----------          ----------
                                                                                            (In thousands)

                 <S>                                                        <C>                <C>                 <C>
                 Net income                                                   $2,727             $2,489              $2,337
                 Average total assets                                       $188,061           $170,352            $161,671
                 Return on average assets                                      1.45%              1.46%               1.45%

                 Net income                                                   $2,727             $2,489              $2,337
                 Average equity                                              $17,440            $15,649             $13,910
                 Return on average equity                                     15.64%             15.91%              16.80%

                 Average equity                                              $17,440            $15,649             $13,910
                 Average total assets                                       $188,061           $170,352            $161,671
                 Average total equity to assets ratio                          9.27%              9.19%               8.60%


</TABLE>
VII.      SHORT-TERM BORROWINGS

         At December 31, 1996, short-term borrowings consisted of advances from
the Federal Home Loan Bank of Seattle totaling $600,000.  The following table
sets forth certain information with respect to short-term borrowings for the
years 1996, 1995, and 1994:


<TABLE>
<CAPTION>
                                                                              1996               1995                1994
                                                                           ----------         ----------          ----------
                                                                                            (In thousands)

                 <S>                                                          <C>                <C>                 <C>
                 Amount outstanding at year-end                               $  600             $1,200              $3,381
                 Weighted average interest rate at year-end                    5.68%              5.42%               5.27%
                 Maximum amount outstanding at any month-end
                   during the year                                            $1,200             $3,581              $4,031
                 Approximate average amount outstanding during
                   the year                                                   $  813             $2,341              $1,872
                 Approximate average weighted interest rate
                   during the year                                             5.86%              6.15%               5.08%


</TABLE>



                                       17
<PAGE>   18
ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

VII.     OTHER FINANCIAL SERVICES

         Columbia River Bank Financial Services is a division of Columbia that
markets stocks, mutual funds, and other investment and insurance products to
customers of Columbia, Klickitat, and the public principally through an
arrangement with PrimeVest Financial Services, Inc., a registered securities
broker-dealer.  In July 1991, Columbia established a relationship with
PrimeVest and hired Ann-Marie Jelderks as a full-time investment salesperson.
Ms. Jelderks is a registered representative of PrimeVest and a joint employee
of PrimeVest and Columbia.  Columbia receives a portion of the commissions
generated by her department's efforts.  Most of these commissions arise from
the sale of financial products offered through PrimeVest, and the remainder
from sales of financial products, such as annuities, offered by insurance
companies and other vendors.  Total commission income received by Columbia from
these activities was $158,575, $105,358 and $107,198 for the years ending
December 31, 1996, 1995, and 1994, respectively.

IX.      COMPETITION

         Commercial banking in Oregon and Washington is highly competitive with
respect to both loans and deposits.  United States National Bank of Oregon, and
Wells Fargo dominate banking with offices throughout the region. Bancorp's
subsidiary banks compete directly with these institutions through its branches
in Madras, Redmond, Bend, The Dalles and Hood River.  Other competitors include
Bank of America, Key Bank, Washington Federal Savings Bank, Riverview Savings
Bank, First Independent Bank, Western Bank, West One, and Bank of the Cascades,
all of which have branches in some of the communities served by Bancorp.

         Bancorp's subsidiary banks stress personal service and local decision
making and believe they benefit from their local orientation.  They also
believe they have benefited from customer confusion resulting from mergers and
acquisitions involving certain competitors. Most of the competition is better
capitalized and, therefore, may have higher lending capabilities.  The larger
competitors also provide certain specialized banking services, such as trust
services and international banking services that Bancorp's subsidiary banks do
not provide.

X.       EMPLOYEES

         At December 31, 1996, Bancorp's subsidiary banks had 132 full-time
equivalent employees.  Management places a high priority on selective hiring
and development of staff.  Staff development involves training in customer
service, marketing and regulatory compliance. No employees are represented by
labor unions, and management considers its employee relations to be excellent.

         Bancorp has no paid employees.  The executive officers of Bancorp, who
receive no compensation from Bancorp for their services on behalf of the
holding company, consist of Terry L. Cochran, President and Chief Executive
Officer, and Richard J. Croghan, Secretary.  Messrs.  Cochran and Croghan are
employed full-time as executive officers of Columbia.





                                       18
<PAGE>   19
ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

XI.      OWNERSHIP OF DATA PROCESSING COMPANY

         As of December 31, 1996, Columbia owned 33% of the issued and
outstanding shares of Datatech of Oregon, Inc. (Datatech), an Oregon
corporation formed in November 1990.  The remaining shares are owned by four
other Oregon state-chartered banking corporations.  Datatech was established to
provide data processing services to its owner-banks.  Datatech does not provide
any data processing services to any other banks or any other persons or
entities.  Datatech operates from leased premises in Eugene, Oregon.  It owns
or leases its data processing and other equipment and personal property.  As of
December 31, 1996, Columbia's interest in Datatech was valued at $52,070.

XII.     SUPERVISION AND REGULATION

         Bancorp and its subsidiary banks are extensively regulated under
federal, Oregon, and Washington law.  These laws and regulations are primarily
intended to protect depositors and the deposit insurance fund, not shareholders
of Bancorp.  The following information is qualified in its entirety by
reference to applicable statutory and regulatory provisions.  Any change in
applicable laws, regulations, or regulatory policies may have a material effect
on the business, operations, and prospects of Bancorp and its subsidiaries.

BANCORP

         Applicable law.  Bancorp is an Oregon corporation subject to the
provisions of the Oregon Business Corporation Act, Oregon Revised Statutes
(ORS) 60.001 through 60.992.  Bancorp is also subject to the Oregon Business
Combination Act (the OBCA).  The OBCA generally provides that if a person (an
Interested Shareholder) acquires voting stock of an Oregon corporation in a
transaction resulting in such person owning 15% or more of the total voting
stock of such corporation, then the corporation and the Interested Shareholder
may not engage in certain business combination transactions for three years
following the date of such acquisition.  A corporation may provide in its
Articles of Incorporation or Bylaws that the OBCA does not apply to its shares.
Bancorp has not adopted such a provision and does not presently plan to do so.
The OBCA may make Bancorp less attractive for takeover.

         ORS 60.357 applies to directors of Bancorp.  Under ORS 60.357, when
directors of a corporation evaluate a proposed tender or exchange offer,
merger, acquisition, or similar proposal, the directors "may, in determining
what they believe to be in the best interest of the corporation, give due
consideration to the social, legal and economic effects on employees, customers
and suppliers of the corporation and its shareholders, including the
possibility that these interests may be best serviced by the continued
independence of the corporation and other relevant factors."





                                       19
<PAGE>   20

ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

         Regulatory oversight.  Bancorp, as an Oregon corporation, is not
regulated by the FDIC.  Bancorp is, however, a bank holding company registered
under the Bank Holding Company Act of 1956, as amended (the Act), and is
subject to supervision of the Board of Governors of the Federal Reserve System
(FRB).  Bancorp is required to file annual reports with the FRB and such other
additional information as the FRB requires pursuant to the Act.  The FRB may
also make examinations of the holding company and of the subsidiary banks.

         Bancorp is an "affiliate" of its subsidiary banks and is subject to
the provisions of Section 23A of the Federal Reserve Act which set certain
limits with respect to the amount of (1) loans or extensions of credit to, or
investments in, Bancorp by its subsidiary banks, and (2) advances to third
parties collateralized by the securities or obligations of Bancorp.

         Acquisitions.  As a bank holding company, Bancorp is required to
obtain the prior approval of the FRB before acquiring direct or indirect
ownership or control of more than 5% of the voting shares of a bank or bank
holding company.  The FRB may not approve any acquisition, merger or
consolidation that would have a substantial anti-competitive result, unless the
anti-competitive effects of the proposed transaction are outweighed by a
greater public interest in meeting the needs and convenience of the public.
The FRB also considers managerial, capital, and other financial factors in
acting on acquisition or merger applications.  Bancorp also is required to
obtain the prior approval of the Director of the Oregon Department of Consumer
and Business Services (the Oregon Director) before acquiring direct or indirect
ownership or control of 25% or more of the voting shares of an Oregon
state-chartered bank or bank holding company.

         Permissible activities.  A bank holding company may not engage in, or
acquire, direct or indirect control of more than 5% of the voting shares of any
company engaged in a nonbanking activity, unless the activity has been
determined by the FRB to be closely related to banking or managing banks.  The
FRB has identified certain nonbanking activities in which a bank holding
company may engage with notice to, or prior approval by, the FRB.

         Capital adequacy.  The federal bank regulatory agencies monitor the
capital adequacy of bank holding companies and have adopted risk-based capital
adequacy guidelines to evaluate bank holding companies and banks.  If an
institution's capital falls below the minimum levels established by these
guidelines, the bank holding company may be denied approval to acquire or
establish additional banks or nonbank businesses. The guidelines require a
minimum ratio of total capital to risk-weighted assets of 8%.

         The FRB also uses a leverage ratio to evaluate the capital adequacy of
bank holding companies.  The leverage ratio applicable to Bancorp requires a
ratio of "Tier 1" capital (generally, tangible common stockholders' equity,
perpetual preferred stock, and minority interests in consolidated subsidiaries)
to adjusted average total assets of not less than 3% and up to 5% or higher
depending on Bancorp's general capital condition.





                                       20
<PAGE>   21
ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

         If Bancorp fails to meet capital guidelines, the FRB may institute
appropriate supervisory or enforcement actions.  As discussed below, Bancorp's
subsidiary banks are also subject to capital adequacy requirements.  Under the
Federal Deposit Insurance Corporation Improvement Act of 1991 (FDICIA), Bancorp
could be required to guarantee the capital restoration plan of the banks,
should they become undercapitalized.  In addition, the Oregon Director (for
Columbia) and the Washington Director (for Klickitat) have the authority to
require Bancorp to contribute additional capital to the banks if their capital
becomes impaired.

COLUMBIA RIVER BANKING COMPANY AND KLICKITAT VALLEY BANK

         Regulatory oversight.  Columbia is an Oregon state-chartered bank, and
Klickitat is a Washington state-chartered bank.  The deposits of each bank are
insured by the FDIC.  Accordingly, each bank files financial and other reports
periodically with, and is regularly examined by, both the respective state
Director and the FDIC.  Neither bank is a member of the Federal Reserve System.

         Permissible activities.  Under FDICIA, no state bank may engage in any
activity not permitted for national banks, unless the institution complies with
applicable capital requirements and the FDIC determines that the activity poses
no significant risk to the insurance fund.  This limitation should not affect
Columbia or Klickitat, since management believes that neither bank is presently
involved in any such activity.

         Branching and acquisitions.  Banks are permitted to conduct business
through branches after application to and approval of the FDIC and the state
Director, if they make certain findings regarding the financial history and
condition of the bank and the appropriateness of the branch in the community to
be served.  Columbia currently has seven branches, and Klickitat currently has
two branches.

         Acquisitions of banks and bank holding companies by out-of-state
banks, holding companies, and other financial institutions is permitted if the
bank being acquired has been providing banking services for a period of at
least three years in Oregon and five years in Washington prior to the effective
date of the acquisition and upon receipt of the approval of the state Director.
Other conditions set forth in state law also must be satisfied.

         Community Reinvestment Act.  Enacted in 1977, the federal Community
Reinvestment Act (the CRA) has become increasingly important to financial
institutions, including their holding companies.  The CRA allows regulators to
reject an application to make an acquisition or establish a branch unless the
applicant has performed satisfactorily under the CRA.  Citizens and interest
groups have standing before the FRB to assert noncompliance with the CRA.
Satisfactory performance means adequately meeting the credit needs of the
communities the applicant serves, including low- and moderate-income
neighborhoods, consistent with the safe and sound operation of the institution.
The applicable federal regulators now regularly conduct CRA examinations to
assess the performance of financial institutions.  Both Columbia and Klickitat
have received satisfactory ratings in their most recent CRA examinations.





                                       21
<PAGE>   22
ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

         Transactions with affiliates.  The banks are subject to certain FRB
restrictions on transactions among related parties.  Section 23A of the Federal
Reserve Act limits the amount of certain transactions, including loans to and
investments in affiliates of the banks, requires certain levels of collateral
for such loans, and limits the amount of advances to third parties that may be
collateralized by the securities of Bancorp or its subsidiaries.

         Section 23B of the Federal Reserve Act requires that certain
transactions between the banks and their affiliates must be on terms
substantially the same, or at least as favorable to the bank, as those
prevailing at the time for comparable transactions with or involving
nonaffiliated companies or, in the absence of comparable transactions, on terms
and under circumstances, including credit standards, that in good faith would
be offered to or would apply to nonaffiliated companies.

         In addition, Section 22(h) of the Federal Reserve Act requires that
the aggregate amount of an institution's loans to officers, directors, and
principal shareholders (and their affiliates) is limited to the amount of its
unimpaired capital and surplus, unless the FDIC determines that a lesser amount
is appropriate.

         A violation of any of the foregoing restrictions may result in the
assessment of civil fines on a bank or a person participating in the conduct of
the affairs of such bank or the imposition of a cease and desist order.

         Dividend restrictions.  Dividends paid by Columbia and Klickitat
provide substantially all Bancorp's cash flow.  Under federal law, prior to the
declaration of any dividend by a bank, the approval of the principal regulator
is required if the total of all dividends in any calendar year exceeds the
total of the bank's net profits for that year combined with its retained net
profits for the preceding two years.  In addition, FDICIA provides that a bank
cannot pay a dividend if it will cause the bank to be "undercapitalized."
Oregon law imposes the following limitations on the payment of dividends by
Oregon state-chartered banks:  (i) no dividends may be paid that would impair
capital; (ii) until the surplus fund of a bank is equal to 50% of its paid-in
capital, no dividends may be declared unless there has been carried to the
surplus account at least 20% of the bank's net profits for the dividend period;
(iii) dividends cannot be greater than net undivided profits minus losses,
certain bad debts, certain charged-off assets or depreciation and accrued
expenses, interest, and taxes; and, (iv) if the surplus fund does not exceed
50% of paid-up capital and a further reduction in the surplus occurs due to
losses, dividends cannot be declared or paid in excess of 50% of net earnings
until the surplus fund is restored to at least the amount from which the
surplus was originally reduced.  Washington law permits state-chartered banks
to pay dividends out of retained earnings.

         Examinations.  The FDIC periodically examines and evaluates
state-chartered banks.  Based upon such an evaluation, the examining regulator
may revalue the assets of an insured institution and require that it charge-off
or reduce the carrying value of specific assets or establish specific reserves
to compensate for the difference between the value determined by the regulator
and the book value of such assets.  The costs of conducting examinations by the
FDIC are assessed to the banks.





                                       22
<PAGE>   23
ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

         Capital adequacy.  Federal regulations establish minimum requirements
for the capital adequacy of depository institutions.  The regulators may
establish higher minimum requirements if, for example, a bank has previously
received special attention or has a high susceptibility to interest rate risk.
Banks with capital ratios below the required minimums are subject to certain
administrative actions, including prompt corrective action, the termination of
deposit insurance upon notice and hearing, or a temporary suspension of
insurance without a hearing.

         The federal risk-based capital guidelines for banks require a ratio of
Tier 1 or core capital to total risk-weighted assets of 4% and a ratio of total
capital to total risk-weighted assets of 8%.  The leverage capital guidelines
require that banks maintain Tier 1 capital of no less than 5% of total adjusted
assets, except in the case of certain highly rated banks for which the minimum
requirement is 3% of total adjusted assets.  At December 31, 1996, Bancorp's
leverage ratio, Tier 1 capital to risk-weighted assets ratio and total
risk-based capital to risk-weighted assets ratio were 9.86%, 14.20%, and
14.92%, respectively.

         FDICIA requires federal banking regulators to take "prompt corrective
action" with respect to a capital-deficient institution, including requiring a
capital restoration plan and restricting certain growth activities of the
institution.  Bancorp could be required to guarantee any such restoration  plan
required of its subsidiary banks.  Bancorp's maximum liability under such
guarantee would be the lesser of 5% of the bank's total assets at the time it
became undercapitalized or the amount necessary to bring the bank into
compliance with the capital plan.

         Under Oregon law, the Oregon Director has the authority to require the
shareholders of an Oregon state-chartered bank (Bancorp, in the case of
Columbia) to contribute additional capital to the bank if its capital becomes
impaired.  The capital of a bank is impaired under Oregon law when the value of
the bank's assets is insufficient to pay its liabilities (excluding any
liability on outstanding capital debentures) plus the amount of its paid-up
capital stock.

         As an institution's capital decreases, the powers of the federal
regulators increase, which can include mandated capital-raising activities,
restrictions on interest rates paid, restrictions on transactions with
affiliates, and removal of management.  In addition, an institution generally
is prohibited from paying dividends or management fees to control persons if
the institution would be undercapitalized after any such payment.

         Pursuant to FDICIA, regulations were adopted defining five capital
levels:  well capitalized, adequately capitalized, undercapitalized, severely
undercapitalized and critically undercapitalized.  Under the regulations,
Columbia and Klickitat are considered well capitalized.

         Internal operating requirements.  In 1993, federal regulators adopted
regulations addressing, among other things:  (i) internal controls, information
systems, and internal audit systems; (ii) loan documentation; (iii) credit
underwriting; (iv) interest rate exposure; (v) asset growth; (vi) ratio of





                                       23
<PAGE>   24
ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

classified assets to capital; (vii) minimum earnings; and, (viii) compensation
and benefit standards for management officials.  These regulations add further
to the cost of compliance and impose recordkeeping requirements on the banks
and Bancorp.

         The consumer lending activities of the banks are also regulated by
numerous laws and regulations which impose disclosure requirements, prohibit
discrimination based on race, sex, age, marital status, and other specified
classifications and impose other restrictions on credit and collection
practices.

         Real estate lending evaluations.  Federal regulators have adopted
uniform standards for evaluating loans secured by real estate or made to
finance improvements to real estate.  Banks are required to establish and
maintain written internal real estate lending policies consistent with safe and
sound banking practices and appropriate to the size of the institution and the
nature and scope of its operations.  The regulations establish loan-to-value
ratio limitations on real estate loans, which are equal to or higher than the
loan-to-value limitations established by the bank.

         Deposit insurance premiums.  The FDIC has adopted regulations
establishing a risk-based deposit insurance premium schedule.  Columbia and
Klickitat have been assigned the lowest possible risk assessment
classification.  Classifications are reviewed semiannually. In addition, the
FDIC has the power to impose special assessments to cover the cost of
borrowings from the U.S. Treasury, the Federal Financing Bank, and Bank
Insurance Fund member banks.

XIII.    CHANGING REGULATORY STRUCTURE

         The laws and regulations affecting banks and bank holding companies
are in a state of flux.  The rules and the regulatory agencies in this area
have changed significantly over recent years, and there is reason to expect
that similar changes will occur in the future.  It is difficult to predict the
outcome of these changes.  The Clinton Administration has announced a program
to reduce the regulatory burden on banks and to streamline and consolidate
regulatory oversight.  The scope and effect of this program are not yet known.

         One of the major additional burdens imposed on the banking industry by
FDICIA is the increased authority of federal agencies to regulate the
activities of federal and state banks and their holding companies.  The FRB,
the FDIC, the Washington Director, and the Oregon Director have extensive
enforcement authority to police unsafe or unsound practices by depository
institutions and their holding companies  and to penalize them for violating
applicable laws and regulations.  FDICIA and other laws have expanded the
agencies' authority in recent years, and the agencies have not yet fully tested
the limits of their powers.





                                       24
<PAGE>   25



ITEM 1.  DESCRIPTION OF BUSINESS - (Continued)

XIV.     EFFECT OF ECONOMIC ENVIRONMENT

         The policies of regulatory authorities, including the monetary
policies of the FRB, have a significant effect on the operating results of bank
holding companies and their subsidiaries.  Among the means available to the FRB
to affect the money supply are open-market operations in U.S. Government
securities, changes in the discount rate on member bank borrowings, and changes
in reserve requirements against member bank deposits.  These means are used in
varying combinations to influence overall growth and distribution of bank
loans, investments and deposits, and their use may affect interest rates
charged on loans or paid for deposits.

         FRB monetary policies have materially affected the operating results
of commercial banks in the past and are expected to continue to do so in the
future.  The nature of future monetary policies and the effect of such policies
on the business and earnings of Bancorp and its subsidiaries cannot be
predicted.





                                       25
<PAGE>   26
ITEM 2.  DESCRIPTION OF PROPERTY

         COLUMBIA BANCORP.  On February 14, 1996, Bancorp purchased .43 acres
of bare land adjacent to Columbia's Hood River office for a cash purchase price
of $111,000.  Bancorp holds title to the land free and clear.  The land was
purchased as an investment, and Bancorp has no present plans to improve or
develop the property.  Possible future uses for the property include an
expansion of the existing Hood River branch facility, additional parking for
customers, or the sale or lease of the property to a third party.

         COLUMBIA RIVER BANKING COMPANY.  Columbia operates from seven
locations in northern and central Oregon.  The northern Oregon locations
include two branches in The Dalles, one branch in Hood River, and one branch in
Maupin.  The central Oregon locations consist of one branch each in Redmond,
Bend and Madras.  Columbia also leases office space in The Dalles.

         Columbia's main office is located at 316 East Third Street, The
Dalles, Oregon.  The office is centrally located in the downtown area.  The
building, which was completely remodeled in 1990, consists of approximately
8,000 square feet of space on two floors.  The building sits on .35 acres of
land, which includes parking and a drive-up window area.  Columbia holds title
to the land and building free and clear.

         Columbia's Westside branch, at 520 Mt. Hood Street in The Dalles, was
opened for business on December 6, 1995.  This branch consists of 430 square
feet inside a Safeway supermarket.  This facility was built to Columbia's
specifications in conjunction with the construction of the supermarket.
Columbia leases this space under a License Agreement entered into on September
8, 1995, with Safeway, Inc., for an annual payment of $22,500.  The initial
term of the License Agreement is five years.  The Westside branch replaced a
previous Westside facility, also on leased premises, closed by Columbia in
1995.

         Columbia's Hood River branch is located at 2650 Cascade Avenue, Hood
River, Oregon.  This facility was built in 1993.  It consists of a 4,000 square
foot one-story building on .58 acres of land on the outskirts of Hood River
adjacent to a recently built Wal-Mart store.  Columbia owns the land and
building free and clear.

         Columbia's Maupin branch is located at Fifth and Deschutes Avenue in
Maupin, Oregon.  This facility consists of 675 square feet in a building which
contains other businesses.  Columbia rents this space at a monthly payment of
$350 on a month-to-month basis.

         Columbia's Madras office is located at 624 S.W. Fourth Avenue in
downtown Madras, Oregon.  This building consists of approximately 7,400 square
feet of space, including offices and meeting rooms on a partial second floor.
The building was built in 1978, and remodeled most recently in 1994.  It sits
on .64 acres of land, which includes parking and a drive-up window area.
Columbia holds title to the land and building free and clear.





                                       26
<PAGE>   27
ITEM 3.  DESCRIPTION OF PROPERTY - (Continued)

         Columbia's Redmond office is located at 434 North Fifth Street, which
is one of the main thoroughfares in Redmond, Oregon.  This facility was built
in 1992, and consists of approximately 4,000 square feet of space on one floor.
The building sits on .54 acres of land, which includes parking and a drive-up
window area and a partial second floor.  Columbia holds title to the land and
building free and clear.

         Columbia's new Bend office is located at 1701 Northeast Third Street,
Bend, Oregon.  The facility, previously a branch of West One bank, consists of
approximately 8,306 square feet.  The bank branch occupies approximately 3,055
square feet, and an additional 5,251 square feet of vacant office space which
is available for lease.  Columbia holds title to the land and building free and
clear.

         Columbia leases approximately 1,900 square feet of office space in the
Hammel Building located at Suite 200, 420 East Third Street, The Dalles,
Oregon.  This facility provides office space for some members of Columbia's
executive management as well as the Human Resource department and secretarial
staff.  Columbia leases this space under a Lease Agreement entered into on
October 23, 1996, for monthly payments of $1,140.

         KLICKITAT VALLEY BANK.  Klickitat owns two buildings in which it does
business along with the underlying land in Goldendale and White Salmon,
Washington.  Klickitat is headquartered in Goldendale, which is approximately
65 miles south of Yakima, Washington, 30 miles north of The Dalles, Oregon and
120 miles east of Portland, Oregon.  White Salmon is approximately 45 miles
southwest of Goldendale, 25 miles west of The Dalles, Oregon, and 65 miles east
of Portland.

         The main office building in Goldendale has approximately 3,105 square
feet on the main level with a 3,000 square foot basement.  The building was
completely remodeled in early 1995.  The building, located on West Main Street
in the downtown area, is near to competing banks and other commercial
businesses.  The building has a drive-up window, a night depository for
customer use, a vault, and 394 safe deposit boxes.

         The White Salmon branch has approximately 5,500 square feet on two
levels.  A parking lot with 24 spaces surrounds the building.  The building
contains a vault with 412 safe deposit boxes.

         Bancorp believes all of its real property facilities are in good
condition and adequate to meet its current requirements.  No portion of the
real property facilities described above are leased or rented to third parties.

ITEM 3.  LEGAL PROCEEDINGS

         Bancorp is not a party to any legal proceeding.  Neither Columbia or
Klickitat are a party to any material legal proceeding.  Bancorp and its
subsidiaries are from time to time involved in routine litigation, such as
collection matters, incidental to their business.





                                       27
<PAGE>   28

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

         None.


                                    PART II

         The information called for by Items 5, 6, and 7 of Part II is included
in Columbia Bancorp's Annual Report to Shareholders for the year ended December
31, 1996, and is incorporated herein by reference as follows:
<TABLE>
<CAPTION>
                                                                                 Columbia Bancorp
                                                                                 Annual Report to
                                                                               Shareholders Page No.
                                                                               ---------------------

<S>          <C>                                                                       <C>
ITEM 5       MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDERS MATTERS                   24
             ---------------------------------------------------------

ITEM 6       MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION                 5 - 8
             ---------------------------------------------------------

ITEM 7       FINANCIAL STATEMENTS                                                      9 - 23
             --------------------

</TABLE>
ITEM 8.          CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
                 AND FINANCIAL DISCLOSURE

         None.


                                    PART III

ITEM 9.          DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS,
                 COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

         The information called for by this item is contained in Columbia
Bancorp's definitive proxy statement for the annual meeting of shareholders to
be held on April 17, 1997, and is incorporated herein by reference.

ITEM 10.         EXECUTIVE COMPENSATION

         The information called for by this item is contained in Columbia
Bancorp's definitive proxy statement for the annual meeting of shareholders to
be held on April 17, 1997, and is incorporated herein by reference.

ITEM 11.         SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The information called for by this item is contained in Columbia
Bancorp's definitive proxy statement for the annual meeting of shareholders to
be held on April 17, 1997, and is incorporated herein by reference.





                                       28
<PAGE>   29
ITEM 12.         CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         The information called for by this item is contained in Columbia
Bancorp's definitive proxy statement for the annual meeting of shareholders to
be held on April 17, 1997, and is incorporated herein by reference.

ITEM 13.         EXHIBITS AND REPORTS ON FORM 8-K

    (a)      Exhibits.

    Pursuant to Item 601 of Regulation S-B, the following exhibits are attached
hereto or incorporated by reference.

    Note:  The statement regarding computation of per share earnings required
by Item 601(b)(11) of Regulation S-B is contained in Note 16 to the
Consolidated Financial Statements contained at page 21 in the 1996 Annual
Report to Shareholders. A copy of the 1996 Annual Report is also attached
hereto as an exhibit.

    1.           Plan of Reorganization.  (Regulation S-B, Item 601, Exhibit
Table Item (2)).  Attached hereto is a copy of the December 10, 1996 Agreement
and Plan of Reorganization and Merger between Columbia River Banking Company
and Klickitat Valley Bank.  This Agreement provides for the merger of Bancorp's
two wholly-owned subsidiaries.

    2.           Agreements with Management. .  (Regulation S-B, Item 601,
Exhibit Table Item (10)). The following employment contracts are attached
hereto:

                 2.1     Employment Agreement of May 14, 1996 between
                 Terry L. Cochran and Columbia Bancorp.

                 2.2     Deferred Compensation Agreement of May 14,
                 1996 between Terry L. Cochran and Columbia Bancorp.

                 2.3     Employment Agreement of June 19, 1996 between
                 Wesley A. Kangas and Klickitat Valley Bank.

                 2.4     Deferred Compensation Agreement of June 19, 1996
                 between Wesley A. Kangas and Klickitate Valley Bank.

    3.           1996 Stock Incentive Plan.  (Regulation S-B, Item 601, Exhibit
Table Item (10)).  Attached hereto is a copy of the Columbia Bancorp 1996 Stock
Incentive Plan.

    4.           1996 Annual Report to Shareholders.  (Regulation S-B, Item
601, Exhibit Table Item (13)).  Attached hereto is the Annual Report to
Shareholders of Bancorp for the fiscal year ending December 31, 1996.





                                       29
<PAGE>   30

ITEM 13.         EXHIBITS AND REPORTS ON FORM 8-K - (Continued)


    5.           List of Subsidiaries of Bancorp.  (Regulation S-B, Item 601,
Exhibit Table Item (21)).  Attached hereto is a list of the subsidiaries of
Bancorp and the assumed business names used by the subsidiaries.

    6.           Financial Data Schedule.  (Regulation S-B, Item 601, Exhibit
Table Item (27)).  Attached hereto is the Financial Data Schedule.

    7.           Documents Incorporated by Reference.  The following exhibits
are incorporated herein by reference to the pages shown of Bancorp's Form 10-SB
filed pursuant to the Securities and Exchange Act of 1934 on or about March 1,
1996.

                 7.1      Articles of Incorporation and Bylaws of Bancorp,
                 pages 167 and 181.  (Regulation S-B, Item 601, Exhibit Table
                 Item (3)).

                 7.2      Columbia River Banking Company Employee Stock
                 Ownership Plan, page 207.  (Regulation S-B, Item 601, Exhibit
                 Table Item (10)).

                 7.3      Columbia River Banking Company 401(k) Plan, page 275.
                 (Regulation S-B, Item 601, Exhibit Table Item (10)).


    (b)          Reports on Form 8-K.

         No reports on Form 8-K were filed during the last quarter of
Bancorp's most current fiscal year, which ended December 31, 1996.

         Upon written request to Richard J. Croghan, Chief Financial Officer,
Bancorp, Post Office Box 1030, The Dalles, Oregon, 97058, shareholders will be
furnished a copy of any exhibit, upon payment of $.25 per page, which
represents Bancorp's reasonable expenses in furnishing the exhibit requested.





                                      30
<PAGE>   31
                                   SIGNATURES

         In accordance with Section 12 of the Securities Exchange Act of 1934,
the registrant caused this registration statement to be signed on its behalf by
the undersigned, thereunto duly authorized.

                                    BANCORP

DATED: March 26, 1997                  By:/s/ Terry L. Cochran
                                          ------------------------------------
                                          Terry L. Cochran, President & C.E.O.

         Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.

                                        PRINCIPAL EXECUTIVE OFFICER AND DIRECTOR


DATED: March 26, 1997                   By /s/ Terry L. Cochran
                                           ------------------------------------
                                           Terry L. Cochran, President, C.E.O.,
                                           and Director

                                        CHIEF FINANCIAL OFFICER

DATED: March 26, 1997                   By /s/ Richard J. Croghan
                                           ------------------------------------
                                            Richard J. Croghan: Chief
                                            Financial Officer and Chief
                                            Accounting Officer - Columbia River
                                            Banking Company
                                           Richard J. Croghan - Chief Financial
                                            Officer and
                                            Chief Accounting Officer -
                                            Columbia Bancorp

                                        DIRECTORS:

DATED: March 21, 1997                   By /s/ Stephen D. Martin
                                           -------------------------------
                                           Stephen D. Martin, Director

DATED: March 24, 1997                   By /s/ Don T. Mitchell
                                           -------------------------------
                                           Don T. Mitchell, Director

DATED: March 21, 1997                   By /s/ Robert L. R. Bailey
                                           -------------------------------
                                           Robert L. R. Bailey, Director





                                       31
<PAGE>   32
                                   SIGNATURES
                                  (Continued)




                                        DIRECTORS:

DATED: March 21, 1997                      By /s/ Charles F. Beardsley
                                              --------------------------------
                                              Charles F. Beardsley, Director


DATED: March 21, 1997                      By /s/ William A. Booth
                                              --------------------------------
                                              William A. Booth, Director

DATED:  ______________________, 1997       By ________________________________
                                              Ted M. Freeman, Director

DATED:  March 22, 1997                     By /s/ Don C. Gomes
                                              --------------------------------
                                              Don C. Gomes, Director


DATED:  ______________________, 1997       By ________________________________
                                              George W. Hall, Director


DATED:  March 24, 1997                     By /s/ Jean McKinney
                                              --------------------------------
                                              Jean McKinney, Director

DATED:  March 21, 1997                     By /s/ Greg Walden
                                              --------------------------------
                                              Greg Walden, Director





                                       32
<PAGE>   33
                                 EXHIBIT INDEX

<TABLE>
<CAPTION>
                                                                         PAGE
EXHIBIT                                                                 NUMBER
-------                                                                 ------
 <S>     <C>

  2.1    Agreement and Plan of Reorganization and Merger between
         Columbia River Banking Company and Klickitat Valley Bank
         dated December 10, 1996.

  3.1    Articles of Incorporation and Bylaws of Columbia Bancorp, page 167 and
         181 (filed as exhibit to Bancorp's Form 10-SB dated on or about March
         1, 1996, and incorporated herein by reference)

 10.1    Employment Agreement of May 14, 1996 between Terry L. Cochran
         and Columbia Bancorp.

 10.2    Deferred Compensation Agreement of May 14, 1996 between
         Terry L. Cochran and Columbia Bancorp.

 10.3    Employment Agreement of June 19, 1996 between Wesley A. Kangas
         and Klickitat Valley Bank.

 10.4    Deferred Compensation Agreement of June 19, 1996 between
         Wesley A. Kangas and Klickitat Valley Bank.

 10.5    1996 Columbia Bancorp Stock Incentive Plan

 10.6    Columbia River Banking Company Employee Stock Ownership Plan,
         page 207 (filed as exhibit to Bancorp's Form 10-SB dated on
         or about March 1, 1996, and incorporated herein by reference)

 10.7    Columbia River Banking Company 401(k) Plan, page 275 (filed as
         exhibit to Bancorp's Form 10-SB dated on or about March 1, 1996,
         and incorporated herein by reference)

 13.1    1996 Annual Report to Shareholders of Columbia Bancorp

 21.1    List of Subsidiaries for Columbia Bancorp and the assumed
         business names used by subsidiaries

 27.1    Financial Data Schedule

</TABLE>




                                       33