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                                                                 EXHIBIT 10.3


                              EMPLOYMENT AGREEMENT

                 This Employment Agreement (the "Agreement") is made and
entered into as of June 19, 1996 by and between Klickitat Valley Bank (the
"Bank") and Wesley A. Kangas ("Employee").

                                    RECITALS

                 (1)      The Bank is a state-chartered Washington financial
institution with its principal office in Goldendale, Washington.

                 (2)      The Bank desires to employ Employee as President and
Chief Executive Officer of the Bank.

                 Now, therefore, it is agreed:

                 1.       Relationship and Duties.

                 1.1      The Bank shall employ Employee as an officer of the
Bank with the title of President and Chief Executive Officer to perform such
services and duties as the Board of Directors of the Bank (the "Board") may
designate from time to time.  Subject to the terms and conditions hereof,
employee shall perform such duties and exercise such authority as are
customarily performed and exercised by persons holding such office, subject to
the general direction of the Board.  Such services and duties shall be
exercised in good faith and in accordance with standards of reasonable business
judgment.

                 1.2      Employee shall serve on the Board and on such
committees established by the Board to which Employee may be appointed.

                 1.3      Employee shall devote his full time, attention and
efforts to the diligent performance of his duties as an officer and director of
the Bank.  Employee will not accept employment with any other individual,
corporation, partnership, governmental authority or any other entity, or engage
in any other venture for profit which the Bank may consider to be in conflict
with the Bank's best interests or to be in competition with the Bank's
business, or which may interfere in any way with Employee's performance of his
duties hereunder.  Any exceptions to the above conditions must be approved by
the Board in writing.

                 1.4      Nothing in the Agreement shall prohibit Employee from
serving on the board of directors of any profit or non-profit corporation not
in direct competition with Bank or with any subsidiary, sister or affiliated
corporation of the Bank.  In addition, Employee may own stock in any other
corporation whether or not the stock is publicly traded; provided, that if such
corporation operates a business in competition with the Bank Employee may not
own more than five percent (5%) of the outstanding shares of such corporation.


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                 2.       Term of Employment.

                 2.1      The term of employment under the Agreement shall
commence on the Effective Date, as that term is defined in that certain
Agreement and Plan of Merger Between Columbia Bancorp and Klickitat Valley Bank
of January 13, 1996, of the acquisition of the Bank by Columbia Bancorp, and
shall end on or before July 31, 1998.

                 2.2      Employee's term of employment under the Agreement may
be extended after July 31, 1998 subject to the mutual agreement of the parties.
The parties shall reach mutual agreement concerning such extensions on or
before a date which is no less than six months prior to the date of expiration
of Employee's term of employment under the Agreement, including any extensions
thereof.

                 3.       Termination.

                 3.1      As used in the Agreement, "termination" shall mean
the termination of Employee's employment relation with the Bank, whether
initiated by Bank or by Employee, and whether with cause or without cause.

                 3.2      Notwithstanding any other provisions of the
Agreement, the employment of Employee shall terminate immediately on the
earlier to occur of any of the following:

                          3.2.1   Employee's death;

                          3.2.2   Employee's complete disability.  "Complete
disability" as used herein shall mean the inability of Employee, due to
illness, accident, or other physical or mental incapacity, to perform the
services required under the Agreement for an aggregate of sixty (60) days
within any period of 120 consecutive days during the term hereof; provided,
however, that disability shall not constitute a basis for discharge with cause;

                          3.2.3   The discharge of Employee by the Bank with
cause.  "Cause" as used herein shall mean (i) Employee's negligence or
misconduct as shall constitute, as a matter of law, a breach of the covenants
and obligations of Employee hereunder; (ii) failure or refusal of Employee to
comply with the provisions of the Agreement; (iii) Employee's conviction by any
duly constituted court with competent jurisdiction of a crime (other than
traffic offenses); (iv) Employee's malfeasance or incompetence, provided that
in applying this criteria the Board shall not be unreasonable or arbitrary, and
provided further that prior to effecting a dismissal under this Section (iv)
the Board shall afford Employee with  fair and reasonable warning and with a
fair and reasonable opportunity to cure any defects in Employee's performance.

                 3.3      Employee may terminate his employment with the Bank
with cause by giving thirty (30) days written notice of termination.  "Cause"
as used herein shall include Bank's failure or refusal to comply with the
provisions of the Agreement. Employee may terminate his employment with the
Bank without cause by giving ninety (90) days written notice of termination.



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                 3.4      The termination of Employee's employment shall
constitute a tender by Employee of his resignation as an officer, Board member
and Board committee member of the Bank.

                 3.5      If prior to the Retirement Date, as defined in
Section 7.1 herein, Employee's employment is terminated by the Bank without
cause, Employee shall be paid all base salary and benefits accrued under the
Agreement as of the termination date, and in addition, shall be entitled to
severance payments consisting of (i) $7,916.76 per month for a period of
twenty-four (24) months from and after the date of termination, and (ii)
$5,000.00 per month thereafter through and including the date of Employee's
60th birthday.  The foregoing severance payments shall be in lieu of, and not
in addition to, the deferred compensation payments and other benefits provided
under the Deferred Compensation Agreement of June 19, 1996 between the parties
(the "DC Agreement").  Employee's termination as provided under this Section
3.5 shall be deemed a cancellation of the DC Agreement, and Employee shall
thereafter be entitled to no payments or benefits thereunder.

                 3.6      If prior to the Retirement Date, as defined in
Section 7.1 herein, Employee's employment is terminated by Employee with or
without cause, Employee shall be paid all base salary and benefits accrued
under the Agreement as of the termination date, and shall be entitled to the
deferred compensation payments and benefits under the DC Agreement.  The
foregoing payments shall be in lieu of, and not in addition to, the severance
payments provided under Section 3.5 of the Agreement.  The date of Employee's
termination as provided in this Section 3.6 shall be deemed the Retirement Date
under the DC Agreement.

                 3.7      If prior to the Retirement Date, as defined in
Section 7.1 herein, Employee's employment is terminated by the Bank with cause,
Employee shall be paid all base salary and benefits accrued under the Agreement
as of the termination date, but shall not be entitled to the deferred
compensation payments and benefits under the DC Agreement, and the DC Agreement
shall be null and void as of such termination date.

                 4.       Compensation.

                 4.1      Employee shall be paid (i) an annual base salary of
$96,420 in equal bimonthly installments, subject to any deductions required by
law, for the period beginning on the date the Agreement becomes effective and
ending December 31, 1996, and (ii) an annual base salary of $100,000 in equal
bimonthly installments, subject to any deductions required by law, for the
period beginning January 1, 1997 and ending July 31, 1998.

                 4.2      In December, 1996 and in the month of December of
each successive year for as long as Employee is employed under the Agreement,
the Board shall determine the amount of and the formulas and methods for
establishing Employee's performance bonus for the following calendar year,
subject to any deductions required by law.  The amount of such bonus shall be
set in the Board's sole discretion, and the Board may decline to award a
performance bonus in any year.



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                 4.3      As of the Effective Date, as that term is defined in
that certain Agreement and Plan of Merger Between Columbia Bancorp and
Klickitat Valley Bank of January 13, 1996, of the acquisition of the Bank by
Columbia Bancorp, Employee shall receive no fees for serving as a member of the
Board of Directors of the Bank or of Columbia Bancorp.

                 5.       Benefits.

                 5.1      Employee shall be eligible to participate in any plan
of the Bank or of Columbia Bancorp relating to stock options, stock purchases,
education and other retirement or employee benefits that the Bank or Columbia
Bancorp may adopt for the benefit of employees.


                 5.2      Employee shall receive medical, dental, disability,
vision and life insurance coverage comparable to the coverage provide to the
President and Chief Executive Officer of Columbia Bancorp's subsidiary,
Columbia River Banking Company.

                 5.3      For the calendar years 1997 and 1998, Employee shall
receive profit sharing benefits comparable to those received by employees of
Columbia Bancorp's subsidiary, Columbia River Banking Company, under the
latter's ESOP and 401(k) plans, or under such other profit sharing plans for
the benefit of employees adopted by Columbia Bancorp or Columbia River Banking
Company.

                 5.4      Employee shall be eligible to participate in any
other benefits which may be or become applicable to the Bank's executive
employees.  In addition, prior to the Retirement Date Employee shall be
entitled to (i) continued use of the Bank automobile presently used by
Employee, and all expenses of maintenance to cover its use, (ii) a reasonable
expense account for use in connection with Bank business, (iii) membership fees
and dues for membership in one golf club mutually agreeable between Employee
and the Board, and (iv) any other benefits which in the Board's judgment are
commensurate with the responsibilities and functions to be performed by
Employee under the Agreement, including the payment of reasonable expenses for
attendance by Employee and Employee's spouse at annual and periodic meetings of
trade associations.

                 6.       Vacations and Leaves.

                 6.1      Employee shall be entitled to an annual paid vacation
of seven (7) weeks during the period beginning August 1, 1996 and ending July
31, 1997, and five (5) weeks during one successive comparable yearly period.
Each such period shall be referred to herein as the "Vacation Calculation
Period."  If Employee's Retirement Date is earlier than the last calendar day
of any Vacation Calculation Period, Employee's entitlement to vacation during
such Period shall be pro-rated over the number of weeks of employment during
such Period.  For example, if Employee's Retirement Date is January 31, 1997,
Employee shall be entitled to two and one-half weeks of paid vacation during
the Vacation Calculation Period ending July 31, 1997.

                 6.2      The timing of vacations shall be scheduled in a
reasonable manner by Employee.  Employee shall not be entitled to receive any
additional compensation



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from the Bank on account of his failure to take a vacation, and may not
accumulate unused vacation time from one Vacation Calculation Period to the
next.

                 6.3      In addition to paid vacations, Employee shall be
entitled, without loss of pay, to absent himself voluntarily from the
performance of his employment with the Bank for such additional periods of time
and for such valid and legitimate reasons as the Board in its discretion may
determine.

                 6.4      The Board may grant Employee a leave or leaves of
absence, with or without pay, at such time or times and upon such terms and
conditions as the Board, in its discretion, may determine.

                 6.5      In each calendar year Employee shall be absent from
the Bank for one period of two consecutive weeks.  Such period may include
vacation, leave, sick leave, attendance at seminars or conventions, or any
combination thereof.

                 7.       Retirement of Employee.

                 7.1      If Employee's employment is not otherwise terminated
prior thereto, Employee's last day of employment under the Agreement shall be
deemed Employee's date of retirement (the "Retirement Date"), after which
Employee shall be deemed retired from employment with the Bank.  Employee's
Retirement Date shall be selected by Employee, and may be any date between
January 1, 1997 and July 31, 1998. The Retirement Date shall in any event be no
later than July 31, 1998, unless Employee's term of employment under the
Agreement has been extended under Section 2.2 of the Agreement.  Employee shall
give the Bank no less than ninety (90) days advance notice in writing of the
Retirement Date.

                 7.2      Unless otherwise provided herein, from and after the
Retirement Date, the Agreement shall be of no further force and effect, and the
relationship between Employee and the Bank shall be governed exclusively by the
DC Agreement.

                 7.3      If Employee's employment is terminated hereunder
prior to the Retirement Date, Employee's right to payment and benefits under
the Agreement and under the DC Agreement shall be determined in accordance with
Section 3 and Section 8 of the Agreement and under the DC Agreement.  Such
termination of employment shall not invalidate the DC Agreement except as
otherwise provided thereunder or under the Agreement.

                 8.       Change of Control.

                 8.1      Employee's rights on termination of employment under
Section 3 of the Agreement, as well as all other rights of Employee under the
Agreement and the DC Agreement or otherwise, shall survive a change of control
of the Bank.

                 8.2      If a change of control of the Bank occurs prior to
the Retirement Date, Employee shall have ninety (90) days following the date
such change of control becomes effective to elect to terminate Employee's
employment without cause.  If


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Employee so elects to terminate, Employee shall receive all payments and
benefits due to Employee on termination under Section 3.6 of the Agreement.

                 8.3        Employee shall be entitled to the payments and
benefits provided under this Section 8 whether or not Employee opposed or
favored the change in control.

                 8.4      The following items shall be due and payable
immediately at Employee's election in the event that a change of control
occurs:

                          8.4.1   Nonforfeitable deferred compensation;

                          8.4.2   Long-term performance plan objective
payments, if any, shall be declared accomplished and earned based upon
performance up to the date of the change of control.

                 8.5      If Employee is a participant in a restricted stock
plan or share option plan, and such plan is terminated involuntarily as a
result of the change of control, all stock and options shall be declared fully
vested and shall be paid, awarded or otherwise distributed.  With respect to
any unexercised options under any stock option plan, such options may be
exercised within the period provided in such plan.  Effective as of the date of
the change of control, any holding period established for stock paid as bonus
or other compensation shall be deemed terminated, except as otherwise provided
by law.

                 8.6      As used in this Section, "control" shall mean the
acquisition of twenty-five percent (25%) or more of the voting securities of
the Bank, or of a holding company owning the shares of the Bank, by any person,
or persons acting as a group within the meaning of Section 13(d) of the
Securities Exchange Act of 1934, or to such acquisition of a percentage between
ten percent (10%) and twenty-five percent (25%) if the Board or the Comptroller
of the Currency, the FDIC, or the Federal Reserve Bank have made a
determination that such acquisition constitutes or will constitute control of
the Bank.  The term "person" refers to an individual, corporation, Bank, bank
holding company, or other entity.  The formation of a one-bank holding company
shall not constitute a change of control under the Agreement.

                 9.       Post Termination Covenants.

                 9.1      If Employee terminates his employment without cause,
or if Employee's employment is terminated by the Bank with cause, then for one
year from the date of such termination Employee will not, without the prior
written consent of the Bank:

                          9.1.1   Undertake full or part-time work, either as
an employee or as a consultant, for another financial institution if such work
is to be done, in whole or in part, in or from an office or other work site in
Wasco, Hood River, Jefferson, Deschutes, Sherman or Gilliam Counties, Oregon or
in Klickitat County, Washington; or


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                          9.1.2   Hire for any financial institution or other
employer (including himself) any employee of the Bank, or directly or
indirectly cause a Bank employee to leave his or her employment to work for
another employer, if such employee is to work in or from an office or other
work site in Wasco, Hood River, Jefferson, Deschutes, Sherman or Gilliam
Counties, Oregon or in Klickitat County, Washington.

                 9.2      The covenants in this Section do not apply if
Employee terminates his employment with cause, or if Employee's employment is
terminated by the Bank without cause.

                 10.      Effective Date of Agreement.

                 10.1     The Agreement shall become effective as of the
Effective Date, as that term is defined in that certain Agreement and Plan of
Merger Between Columbia Bancorp and Klickitat Valley Bank of January 13, 1996,
of the acquisition of the Bank by Columbia Bancorp.  The Agreement shall not
become effective if the proposed acquisition does not occur for any reason.

                 10.2     The Agreement, when effective, shall supersede and
replace the Wesley A. Kangas Change of Control Protection Agreement between the
parties of September 26, 1995, and the latter agreement shall be deemed null
and void as of the date the Agreement becomes effective.

                 11.      Miscellaneous.

                 11.1     Employee's retirement from employment under the
Agreement on the Retirement Date shall not be deemed a retirement or general
termination under any stock incentive plan applicable to Employee, except as
otherwise provided therein or as provided under law, and shall therefore not
limit the time within which Employee may exercise Employee's stock option
rights, if any, under such plan unless the plan or applicable law provides to
the contrary.

                 11.2     Each and every portion of the Agreement is
contractual and not a mere recital, and all recitals shall be deemed
incorporated into the Agreement.  The Agreement shall be governed by and
interpreted according to Washington law and any applicable federal law.  The
Agreement may not be amended except by a subsequent written agreement signed by
all parties hereto.

                 11.3     The Agreement contains the entire understanding and
agreement of the parties with respect to the parties' relationship, and all
prior negotiations, discussions or understandings, oral or written, are hereby
integrated herein.  No prior negotiations, discussions or agreements not
contained herein or in such documents shall be binding or enforceable against
the parties.

                 11.4     The Agreement may be signed in several counterparts.
The signature of one party on any counterpart shall bind such party just as if
all parties had



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signed that counterpart.  Each counterpart shall be considered an original.
All counterparts of the Agreement shall together constitute one original
document.

                 11.5     Employee's rights under the Agreement are in addition
to Employee's rights under the DC Agreement, except as otherwise provided
herein or under the DC Agreement.

                 11.6     All rights and duties of the Bank under the Agreement
shall be binding on and inure to the benefit of the Bank's successors and
assigns, including any person or entity which acquires a controlling interest
in the Bank and any person or entity which acquires all or substantially all of
Bank's assets.  The Bank and any such successor or assign shall be and remain
jointly and severally liable to Employee under the Agreement.  Employee may not
assign or transfer Employee's rights or interests in or under the Agreement
other than by a will or by the laws of descent and distribution.  The Agreement
shall inure to the benefit of and be enforceable by Employee's estate or legal
representative.  Notwithstanding the foregoing, all benefits provided under
Section 5 of the Agreement shall terminate upon Employee's death.

                 11.7     If Employee dies prior to receiving all or any
portion of the severance payments payable under Section 3.5 of the Agreement,
the Agreement shall be null and void as of the date of Employees' death, and no
further payments shall be due under Section 3.5 to Employee's estate, to any
assignee, or to any other person or entity.

                 11.8     Any waiver by any party hereto of any provision of
the Agreement, or of any breach thereof, shall not constitute a waiver of any
other provision or of any other breach.   If any provision, paragraph or
subparagraph herein shall be deemed invalid, illegal or unenforceable in any
respect, the validity and enforceability of the remaining provisions,
paragraphs and subparagraphs shall not be affected.

                 11.9     Any dispute, controversy, claim or difference
concerning or arising from the Agreement or the rights or performance of either
party under the Agreement, including disputes about the interpretation or
construction of the Agreement, shall be settled through binding arbitration in
the State of Washington and in accordance with the rules of the American
Arbitration Association.  A judgment upon the award rendered in such
arbitration may be entered in any court of competent jurisdiction.

            [SIG]
______________________________________
Employee


KLICKITAT VALLEY BANK

           [SIG]
By:____________________________________
      Chairman of the Board



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