SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

                                   FORM 10-Q

[x]   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the Quarterly Period Ended        June 30, 2002
                               -----------------------------

[  ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934

                        Commission File No. 0-25418

                             CENTRAL COAST BANCORP
-------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)



                  California                              77-0367061
-------------------------------------------             --------------
  (State or other jurisdiction of                  (IRS Employer ID Number)
  incorporation or organization)


  301 Main Street, Salinas, California                          93901
-------------------------------------------                   --------
 (Address of principal executive offices)                    (Zip code)


                                    (831) 422-6642
                                   -----------------
                            (Registrant's telephone number,
                                 including area code)


                                     not applicable
                                    ---------------
  (Former name, former address and former fiscal year, if changed since last
                                   report.)

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or 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
                                                  -----    -------

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date:

No par value Common Stock - 9,014,174 shares outstanding at August 2, 2002 .





               The Index to Exhibits is located at page 28 Page
                                 1 of 72 Pages



<PAGE>


                    PART 1-FINANCIAL INFORMATION
                    Item 1.FINANCIAL STATEMENTS:
                CENTRAL COAST BANCORP AND SUBSIDIARY
          CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited)
<TABLE>
<CAPTION>

                                                    June 30,  December 31,
(In thousands, except per share data)                 2002       2001
                                                      ----       ----
<S>                                                   <C>          <C>

Assets
  Cash and due from banks                           $ 61,816   $ 55,245
  Federal funds sold                                  15,442          -
                                                    ---------  ---------
     Total cash and equivalents                       77,258     55,245

  Available-for-sale securities (amortized
     cost of $115 at June 30, 2002
     and $138 at December 31, 2001)                  117,163    137,153
  Loans:
    Commercial                                       185,560    199,761
    Real estate-construction                          86,118     85,314
    Real estate-other                                388,524    306,622
    Consumer                                          16,030     15,653
    Deferred loan fees, net                           (1,196)    (1,050)
                                                    ---------  ---------
        Total loans                                  675,036    606,300
    Allowance for loan losses                        (13,012)   (11,753)
                                                    ---------  ---------
  Net Loans                                          662,024    594,547
                                                    ---------  ---------

  Premises and equipment, net                          3,071      2,962
  Accrued interest receivable and other assets        11,433     12,359
                                                    ---------  ---------
Total assets                                       $ 870,949  $ 802,266
                                                    =========  =========
Liabilities and Shareholders' Equity
  Deposits:
    Demand, noninterest bearing                    $ 213,726  $ 231,501
    Demand, interest bearing                         138,073    105,949
    Savings                                          188,734    122,861
    Time                                             245,582    264,551
                                                    ---------  ---------
        Total Deposits                               786,115    724,862
  Accrued interest payable and other liabilities      12,482     12,068
                                                    ---------  ---------
Total liabilities                                    798,597    736,930
                                                    ---------  ---------
Commitments and contingencies (Note 2)
Shareholders' Equity:
  Preferred stock-no par value; authorized
    1,000,000 shares; no shares issued
  Common stock - no par value; authorized
    25,000,000 shares; issued and outstanding:
    9,005,690 shares at June 30, 2002
    and 8,963,780 shares at December 31, 2001         51,151     50,898
  Shares held in deferred compensation trust
    373,810 at June 30, 2002 and at December
    31, 2001), net of deferred obligation                  -          -
  Retained earnings                                   20,138     14,855
  Accumulated other comprehensive loss - net of
    taxes of $755 at June 30, 2002 and $297 at
    December 31, 2001                                  1,063       (417)
                                                    ---------  ---------
Total shareholders' equity                            72,352     65,336
                                                    ---------  ---------
Total liabilities and shareholders' equity         $ 870,949  $ 802,266
                                                    =========  =========
See Notes to Consolidated Condensed Financial Statements
</TABLE>

<PAGE>


                     CENTRAL COAST BANCORP AND SUBSIDIARY
            CONSOLIDATED CONDENSED STATEMENTS OF INCOME (Unaudited)
<TABLE>
<CAPTION>

                              Three Months Ended June 30,  Six Months Ended June 30,
(In thousands,                        2002        2001       2002        2001
 except per share data)               ----        ----       ----        ----

<S>                                    <C>         <C>         <C>         <C>

Interest Income
   Loans (including fees)           $ 10,952    $ 10,709    $ 21,044    $ 21,734
   Investment securities               1,601       2,122       3,347       4,325
   Other                                  78         113         147         305
                                     --------   ---------  ----------  ----------
       Total interest income          12,631      12,944      24,538      26,364
                                     --------   ---------  ----------  ----------
Interest Expense
   Interest on deposits                3,396       4,729       6,929       9,562
   Other                                 122          94         214         187
                                     --------   ---------  ----------  ----------
       Total interest expense          3,518       4,823       7,143       9,749
                                     --------   ---------  ----------  ----------
Net Interest Income                    9,113       8,121      17,395      16,615
Provision for Loan Losses                900          75       1,123         195
                                     --------   ---------  ----------  ----------
Net Interest Income after
   Provision for Loan Losses           8,213       8,046      16,272      16,420
                                     --------   ---------  ----------  ----------

Noninterest Income
   Service Charges on Deposits           575         471       1,077         903
   Other                                 387         304         652         522
                                     --------   ---------  ----------  ----------
       Total noninterest revenue         962         775       1,729       1,425
                                     --------   ---------  ----------  ----------

Noninterest Expenses
   Salaries and benefits               3,044       2,869       5,795       5,871
   Occupancy                             459         385         880         822
   Furniture and equipment               437         456         861         911
   Other                               1,285       1,066       2,274       2,111
                                     --------   ---------  ----------  ----------
       Total noninterest expenses      5,225       4,776       9,810       9,715
                                     --------   ---------  ----------  ----------
Income Before Income Taxes             3,950       4,045       8,191       8,130
Provision for Income Taxes             1,403       1,522       2,908       3,048
                                     --------   ---------  ----------  ----------
       Net Income                    $ 2,547     $ 2,523     $ 5,283     $ 5,082
                                     ========   =========  ==========  ==========

Basic Earnings per Share              $ 0.28      $ 0.28      $ 0.59      $ 0.56
Diluted Earnings per Share            $ 0.27      $ 0.26      $ 0.56      $ 0.52

See Notes to Consolidated Condensed Financial Statements
</TABLE>
<PAGE>

                     CENTRAL COAST BANCORP AND SUBSIDIARY
          CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited)
<TABLE>
<CAPTION>

(In thousands)
Six months ended June 30,                              2002           2001
                                                       ----           ----
<S>                                                      <C>           <C>

Cash Flows from Operations:
   Net income                                          $ 5,283       $ 5,082
   Reconciliation of net income to net cash provided
   by operating activities:
     Provision for loan losses                           1,123           195
     Net gain on sale of investments                      (102)           (3)
     Depreciation                                          637           690
     Net loss on sale of fixed assets                       17             1
     Amortization and accretion                            473           193
     Decrease (increase) in accrued interest
      receivable and other assets                         (252)         (523)
     Increase (decrease) in accrued interest
      payable and other liabilities                       (152)       (2,144)
     Increase in deferred loan fees                        146           214
                                                     ----------      --------
       Net cash provided by operations                   7,173         3,705
                                                     ----------      --------
Cash Flows from Investing Activities:
   Proceeds from maturities of investment securities    97,968        38,223
   Purchases of investment securities                  (92,404)      (88,520)
   Proceeds from sale of investment securities          16,714        52,817
   Net increase in loans                               (68,746)      (34,974)
   Purchases of premises and equipment                    (745)         (175)
                                                     ----------      --------
       Net cash used in investing activities           (47,213)      (32,629)
                                                     ----------      --------
Cash Flows from Financing Activities:
   Net increase in deposit accounts                     61,253        39,537
   Net increase (decrease) in long-term borrowings         682          (148)
   Cash received for stock options exercised               118            67
   Cash paid for shares repurchased                          -        (3,883)
                                                     ----------      --------
       Net cash provided by financing activities        62,053        35,573
                                                     ----------      --------
  Net increase in cash and equivalents                  22,013         6,649
Cash and equivalents, beginning of period               55,245        74,492
                                                     ----------      --------
Cash and equivalents, end of period                   $ 77,258       $ 81,141
                                                     ==========      ========

Other Cash Flow Information:
   Interest paid                                       $ 7,617       $ 9,642
   Income taxes paid                                     2,612         4,737
See Notes to Consolidated Condensed Financial Statements
</TABLE>





<PAGE>


                     CENTRAL COAST BANCORP AND SUBSIDIARY
             NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
                           June 30, 2002 (Unaudited)

1. CONSOLIDATED FINANCIAL STATEMENTS

In the opinion of management,  the unaudited  consolidated  condensed financial
statements  contain  all  adjustments  (consisting  of  only  normal  recurring
adjustments)   necessary  to  present  fairly  Central  Coast   Bancorp's  (the
"Company's")  consolidated financial position at June 30, 2002 and December 31,
2001,  the  results of  operations  for the three and six month  periods  ended
June 30,  2002 and 2001 and cash  flows for the six month  periods  ended  June
30, 2002 and 2001.

Certain  disclosures  normally  presented in the notes to the annual  financial
statements  prepared  in  accordance  with  accounting   principles   generally
accepted  in the United  States of America  have been  omitted.  These  interim
consolidated  condensed  financial  statements  should  be read in  conjunction
with the  consolidated  financial  statements and notes thereto included in the
Company's  2001 Annual Report to  Shareholders.  The results of operations  for
the  three  and six  month  periods  ended  June  30,  2002  and  2001  may not
necessarily be indicative of the operating results for the full year.

In  preparing  such  financial  statements,  management  is  required  to  make
estimates  and  assumptions  that  affect  the  reported  amounts of assets and
liabilities  as of the date of the balance  sheet and revenues and expenses for
the period.  Actual results could differ  significantly  from those  estimates.
Material  estimates that are  particularly  susceptible to significant  changes
in the  near  term  relate  to the  determination  of the  allowance  for  loan
losses.

Management has determined  that since all of the  commercial  banking  products
and  services  offered  by the  Company  are  available  in each  branch of the
Community Bank of Central  California,  its bank subsidiary  (the "Bank"),  all
branches are located within the same economic  environment  and management does
not  allocate  resources  based on the  performance  of  different  lending  or
transaction  activities,  it is  appropriate to aggregate the Bank branches and
report them as a single operating segment.

Stock  split  - On  January  28,  2002,  the  Board  of  Directors  approved  a
five-for-four  stock split,  which was  distributed  on February  28, 2002,  to
shareholders  of record as of February 14,  2002.  All share and per share data
for the year 2001 have been retroactively adjusted to reflect the stock split.

2. COMMITMENTS AND CONTINGENCIES

In the normal course of business there are outstanding  various  commitments to
extend credit which are not reflected in the  financial  statements,  including
loan  commitments of  approximately  $201,662,000 and standby letters of credit
of  approximately  $6,148,000 at June 30, 2002.  However,  all such commitments
will not necessarily culminate in actual extensions of credit by the Company.

Approximately  $42,802,000  of loan  commitments  outstanding  at June 30, 2002
relate to real estate  construction  loans that are expected to fund within the
next twelve months.  The remaining  commitments  primarily  relate to revolving
lines of credit or other commercial  loans,  and many of these  commitments are
expected  to  expire   without   being  drawn   upon.   Therefore,   the  total
commitments  do  not  necessarily  represent  future  cash  requirements.  Each
potential   borrower  and  the  necessary   collateral   are  evaluated  on  an
individual  basis.  Collateral  varies,  but may include  real  property,  bank
deposits, debt or equity securities or business assets.

Stand-by   letters  of  credit  are   commitments   written  to  guarantee  the
performance  of a  customer  to a third  party.  These  guarantees  are  issued
primarily  relating to purchases of inventory by  commercial  customers and are
typically  short-term  in nature.  Credit  risk is similar to that  involved in
extending  loan  commitments  to  customers  and  accordingly,  evaluation  and
collateral  requirements  similar  to those  for  loan  commitments  are  used.
Virtually all such commitments are collateralized.


3. EARNINGS PER SHARE

Basic  earnings per share is computed by dividing net income by the
weighted   average  common  shares   outstanding  for  the  period.
Diluted  earnings per share  reflects the  potential  dilution that
could occur if options or other  contracts  to issue  common  stock
were exercised and converted into common stock.

There was no difference in the  numerator  used in the  calculation
of basic  earnings per share and diluted  earnings  per share.  The
denominator  used in the  calculation  of basic  earnings per share
and  diluted  earnings  per share for three and  six-month  periods
ended June 30 is reconciled as follows:

<TABLE>
<CAPTION>
                                     Three Months       Six Months
                                        Ended             Ended
                                       June 30,          June 30,
In thousands (expect per share       2002    2001      2002   2001
data)                                ----    ----      ----   ----

<S>                                  <C>      <C>       <C>    <C>

Basic Earnings Per Share
------------------------

Net income                          $2,547  $2,523    $5,283 $5,082
Weighted average common shares
  outstanding                        9,003   9,025     8,989  9,110
                                    ------  ------   ------- ------
   Basic earnings per share         $ 0.28  $ 0.28    $ 0.59 $ 0.56
                                    ======  ======   ======= ======

Diluted Earnings Per Share
--------------------------
Net Income                          $2,547  $2,523    $5,283 $5,082
Weighted average common shares
  outstanding                        9,003   9,025     8,989  9,110
Dilutive effect of outstanding
  options                              436     435       426    405
                                    ------  ------   ------- ------
Weighted average common shares
  outstanding - Diluted              9,439   9,460     9,415  9,515
                                    ------  ------   ------- ------
   Diluted earnings per share       $ 0.27  $ 0.26    $ 0.56 $ 0.52
                                    ======  ======   ======= ======
</TABLE>


4.  COMPREHENSIVE INCOME
<TABLE>
<CAPTION>

                                  Three Months Ended   Six Months Ended
                                       June 30,            June 30,
(In thousands)                      2002      2001      2002        2001
                                    ----      ----      ----        ----
<S>                                   <C>       <C>       <C>        <C>

Net Earnings                        $2,547    $2,523    $5,283     $5,082
Other comprehensive income(loss)-
    Net unrealized gain (loss) on
    available-for-sale securities    1,445      (316)    1,541        934

Reclassification adjustment for gains
    included in income, net of taxes
    of $41 for the three and six
    months ended June 30, 2002 and $2
    and $1 for the three and six
    months ended June 30, 2001         (61)       (3)      (61)        (2)
                                   --------  --------  --------    -------

Total comprehensive income          $3,931    $2,204    $6,763     $6,014
                                   ========  ========  ========    =======
</TABLE>

5.    STOCK REPURCHASE PLAN

The Board of Directors has  authorized a stock  repurchase  program under which
repurchases  will be made from time to time by the Company in the open  market,
or in block purchases, or in privately negotiated  transactions,  in compliance
with   Securities  and  Exchange   Commission   rules.   The  Company  has  not
repurchased   any   shares  in  2002.   As  of  June  30,   2002,   there  were
approximately  279,900  shares  remaining  under the program for  repurchase by
the Company.




6.    RECENT ACCOUNTING PRONOUNCEMENTS

In April  2002,  the  Financial  Accounting  Standards  Board  {"FASB")  issued
Statement of Financial  Accounting  Standards ("SFAS") No. 145,  "Rescission of
FASB  Statements  No. 4, 44, and 64,  Amendment of FASB  Statement  No. 13, and
Technical  Corrections".  SFAS No. 145 rescinds and amends these  statements to
eliminate   any   inconsistency    between   the   required    accounting   for
sale-leaseback  transactions  and the  required  accounting  for certain  lease
modifications  that have  economic  effects that are similar to  sale-leaseback
transactions.   SFAS  No.  145  also  amends   other   existing   authoritative
pronouncements to make various  technical  corrections,  clarify  meanings,  or
describe their applicability under changed conditions  including  clarification
that  gains  or  losses  from  normal  extinguishments  of  debt  need  not  be
classified  as  extraordinary  items.  The Company  adopted  SFAS No. 145 as of
April  1,  2002.  The  adoption  did  not  have  a  significant  impact  on the
Company's financial position, results of operations, or cash flows.

In June 2002, the FASB issued SFAS 146,  Accounting for Costs  Associated  with
Exit or Disposal  Activities,  which addresses accounting for restructuring and
similar costs. SFAS 146 supersedes  previous accounting  guidance,  principally
Emerging  Issues  Task  Force  Issue  No.  94-3.  The  Company  will  adopt the
provisions of SFAS 146 for  restructuring  activities  initiated after December
31, 2002.  SFAS 146 requires that the liability  for costs  associated  with an
exit or  disposal  activity  be  recognized  when the  liability  is  incurred.
Under Issue 94-3, a liability  for an exit cost was  recognized  at the date of
the  Company's  commitment  to an exit  plan.  SFAS 146 also  establishes  that
the  liability  should  initially  be  measured  and  recorded  at fair  value.
Accordingly,   SFAS  146  may   affect  the   timing  of   recognizing   future
restructuring costs as well as the amounts recognized.



<PAGE>


                Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                        ---------------------------------------
                 FINANCIAL CONDITION AND RESULTS OF OPERATIONS


In addition to the  historical  information  contained  herein,  this report on
Form 10-Q  contains  certain  forward-looking  statements  that are  subject to
risks and  uncertainties  that could cause actual results to differ  materially
from those  projected.  Changes to such risks and  uncertainties,  which  could
impact future financial  performance,  include,  among others,  (1) competitive
pressures  in  the  banking   industry;   (2)  changes  in  the  interest  rate
environment;  (3) general economic  conditions,  nationally,  regionally and in
operating  market  areas,  including  a decline  in real  estate  values in the
Company's market areas;  (4) the effects of terrorism,  including the events of
September 11, 2001 and thereafter;  (5) changes in the regulatory  environment;
(6) changes in accounting  principles and  procedures;  (7) changes in business
conditions  and  inflation;   (8)  changes  in  securities  markets;  (9)  data
processing  compliance  problems;  (10) the California  energy  problems;  (11)
variances  in the actual  versus  projected  growth in assets;  (12)  return on
assets;  (13) loan  losses;  (14)  expenses;  (15)  rates  charged on loans and
earned on  securities  investments;  (16) rates paid on deposits;  and (17) fee
and other  noninterest  income earned,  as well as other  factors.  This entire
report should be read to put such  forward-looking  statements  in context.  To
gain a more complete  understanding of the  uncertainties and risks involved in
the Company's  business this report should be read in conjunction  with Central
Coast  Bancorp's  annual  report on Form 10-K for the year ended  December  31,
2001.

Critical Accounting Policies
----------------------------

General

Central Coast  Bancorp's  financial  statements are prepared in accordance with
accounting  principles  generally  accepted  in the  United  States of  America
("GAAP").  The financial  information  contained within our statements is, to a
significant  extent,  financial  information  that is based on  measures of the
financial  effects of transactions  and events that have already  occurred.  We
use  historical  loss factors as one factor in  determining  the inherent  loss
that  may  be  present  in our  loan  portfolio.  Actual  losses  could  differ
significantly  from the historical  factors that we use.  Other  estimates that
we use are related to the  expected  useful  lives of our  depreciable  assets.
In addition  GAAP itself may change from one  previously  acceptable  method to
another  method.  Although  the  economics  of our  transactions  would  be the
same, the timing of events that would impact our transactions could change.

Allowance for Loan Losses

The  allowance  for  loan  losses  is an  estimate  of the  losses  that may be
sustained  in  our  loan  portfolio.  The  allowance  is  based  on  two  basic
principles  of  accounting.  (1) Statement of Financial  Accountings  Standards
("SFAS") No. 5 "Accounting  for  Contingencies",  which requires that losses be
accrued  when they are  probable of occurring  and  estimable  and (2) SFAS No.
114,  "Accounting by Creditors for  Impairment of a Loan",  which requires that
losses be accrued  based on the  differences  between the value of  collateral,
present  value of  future  cash  flows or  values  that are  observable  in the
secondary market and the loan balance.

Our  allowance  for  loan  losses  has  three  basic  components:  the  formula
allowance,  the  specific  allowance  and the  unallocated  allowance.  Each of
these  components is  determined  based upon  estimates  that can and do change
when the actual events occur.  The formula  allowance  uses an historical  loss
view as an  indicator  of future  losses and as a result  could differ from the
loss  incurred in the future.  However,  since this history is updated with the
most  recent  loss  information,  the  errors  that might  otherwise  occur are
mitigated.  The  specific  allowance  uses various  techniques  to arrive at an
estimate  of  loss.  Historical  loss  information,  and fair  market  value of
collateral  are used to  estimate  those  losses.  The use of these  values  is
inherently  subjective  and our actual losses could be greater or less than the
estimates.  The unallocated  allowance  captures  losses that are  attributable
to various  economic  events,  industry or  geographic  sectors whose impact on
the  portfolio  have  occurred,  but have yet to be  recognized  in either  the
formula  or  specific  allowances.   For  further  information   regarding  our
allowance for loan losses,  see  "Allowance for Loan Losses"  discussion  later
in this Item.

Stock Based Awards

The Company  accounts  for its stock based  awards  using the  intrinsic  value
method in accordance  with Accounting  Principles  Board ("APB") Opinion No. 25
and related  interpretations.  Since the  Company's  stock option plans provide
for the  issuance of options at a price of no less than the fair  market  value
at the date of the grant,  no  compensation  expense has been recognized in the
financial statements.

Business Organization
---------------------

Central Coast Bancorp (the  "Company")  is a California  corporation  organized
in 1994, and is the parent  company for Community  Bank of Central  California,
a  state-chartered  bank,  headquartered  in Salinas,  California (the "Bank").
Its  investment  in the Bank  comprises  the  major  business  activity  of the
Company.  Upon prior  notification  to the Board of  Governors,  the Company is
authorized  to engage in a variety  of  activities,  which are  deemed  closely
related  to the  business  of  banking.  The  Company  is  engaged  in  certain
lending  activities  related to the  purchase of certain tax  advantaged  loans
from the Bank.

The Bank  offers a full  range of  commercial  banking  services,  including  a
diverse  range of  traditional  banking  products and services to  individuals,
merchants,  small and medium-sized  businesses,  professionals and agribusiness
enterprises.  Its  principal  markets are located in the  counties of Monterey,
San Benito,  Santa Clara and Santa Cruz,  which are in the central coastal area
of California.

Overview
--------

For the second quarter 2002,  Central Coast Bancorp  reported  diluted earnings
per share of $0.27  versus  $0.26  reported  in the year  earlier  period.  Net
income for the  quarter  ended June 30,  2002 was  $2,547,000  as  compared  to
$2,523,000  reported  for the  same  period  of  2001.  The  return  on  equity
("ROE")  and the  return on assets  ("ROA")  for the second  quarter  2002 were
14.5% and 1.20% as compared to 16.6% and 1.44% for the same period in 2001.

Net income for the six months ended June 30, 2002 and 2001 was  $5,283,000  and
$5,082,000  with  diluted  earnings  per share of $.56 and $.52,  respectively.
For the first six months of 2002,  ROE was 15.4% and ROA was 1.28% as  compared
to 16.8% and 1.48% for the same  period  in 2001.  The  earnings  per share for
the 2001 periods  have been  adjusted  for the 25% stock split  distributed  in
February 2002.

The  Company  continued  to  experience  strong  growth  in  assets,  loans and
deposits  during the second  quarter of 2002.  At June 30,  2002,  the  Company
had assets  totaling  $870,949,000,  an  increase  of  $34,881,000  (4.2%) from
March 31, 2002 and $68,683,000  from year-end 2001.  During the quarter,  loans
increased   $55,456,000   (9.0%)  to  total  $675,036,000  at  June  30,  2002.
Deposits  increased  $31,757,000  (4.2%) to total  $786,115,000 at quarter end.
The deposit  growth was  accomplished  even with a reduction of  $20,000,000 of
State of  California  certificates  of  deposit in April  2002.  On a year over
year  basis,   internal   growth  has   generated  an  increase  in  assets  of
$124,813,000  (16.7%);  an increase in loans of  $166,938,000  (32.9%);  and an
increase in deposits of  $113,368,000  (16.9%),  which was net of a decrease of
$10,000,000 of State of California certificates of deposit.

Central Coast  Bancorp  ended the second  quarter of 2002 with a Tier 1 capital
ratio of 9.7% and a total  risk-based  capital  ratio of 10.9% versus 10.6% and
11.9%, respectively, at the end of the second quarter of 2001.

In April  2002,  the Bank  opened its  eleventh  branch in Gilroy,  California,
which is  located  in the  southern  portion  of Santa  Clara  County.  In July
2002, the Bank entered into a lease  agreement for a branch office  building in
downtown  Monterey.   Subject  to  regulatory  approval,  the  Monterey  branch
opening is planned  for early  fourth  quarter  of 2002.  Both of these  branch
expansions  represent  a  continuation  of our  strategic  plan to  expand  the
Bank's footprint within and on the fringes of our existing market area.

Within  the  Management's   Discussion  and  Analysis,   interest  income,  net
interest  income,  net interest  margin and the efficiency  ratio are presented
on a fully taxable  equivalent  basis  ("FTE").  These items have been adjusted
to give effect to $279,000 and $281,000 in taxable  equivalent  interest income
on tax-free  investments  for the three- month periods ending June 30, 2002 and
2001 and $561,000 and $539,000 for the six-month periods ending June 30, 2002.

The following table provides a summary of the major elements of income and
expense for the periods indicated.


<TABLE>
<CAPTION>
Condensed Comparative Income Statement
                                                      Percentage                    Percentage
                                    Three Months Ended  Change    Six Months Ended    Change
                                         June 30,      Increase       June 30,       Increase
(In thousands, except percentages)    2002     2001   (Decrease)   2002      2001   (Decrease)
                                      ----     ----   ----------   ----      ----   ----------
<S>                                    <C>      <C>      <C>        <C>      <C>        <C>

Interest Income (1)                $ 12,910 $ 13,225     -2%   $ 25,099  $ 26,903      -7%
Interest Expense                      3,518    4,823    -27%      7,143     9,749     -27%
                                     ------    -----    -----    ------     -----     -----
  Net interest income                 9,392    8,402     12%     17,956    17,154       5%
Provision for Loan Losses               900       75   1100%      1,123       195     476%
                                     ------    -----    -----    ------     -----     -----
  Net interest income after
    provision for loan losses         8,492    8,327      2%     16,833    16,959      -1%
Noninterest Income                      962      775     24%      1,729     1,425      21%
Noninterest Expense                   5,225    4,776      9%      9,810     9,715       1%
                                     ------    -----    -----    ------     -----     -----
  Income before income taxes          4,229    4,326     -2%      8,752     8,669       1%
Provision for Income Taxes            1,403    1,522     -8%      2,908     3,048      -5%
Tax Equivalent Adjustment               279      281     -1%        561       539       4%
                                     ------    -----    -----    ------     -----     -----

  Net income                        $ 2,547  $ 2,523      1%    $ 5,283    $5,082       4%
                                     ======    =====    =====    ======     =====     =====

1) Interest on tax-free securities is reported on a tax equivalent basis.
</TABLE>




<PAGE>


Net interest income / net interest margin
-----------------------------------------

Net  interest  income,  the  difference  between  interest  earned on loans and
investments  and  interest  paid  on  deposits  and  other  borrowings,  is the
principal  component  of  the  Bank's  earnings.  Net  interest  margin  is net
interest  income  expressed  as a percentage  of average  earning  assets.  The
first  two  following  tables  provide  a  summary  of  the  components  of net
interest  income  and  the  changes  within  the  components  for  the  periods
indicated.  The third  table sets forth a summary  of the  changes in  interest
income  and  interest  expense  from  changes in  average  asset and  liability
balances  (volume)  and  changes  in  average  interest  rates for the  periods
indicated.

<TABLE>
<CAPTION>

                                                                Three months ended June 30,
(Taxable Equivalent Basis)                                2002                               2001
                                               Avg.                 Avg.         Avg.                    Avg.
(In thousands, except percentages)            Balance   Interest    Yield       Balance     Interest     Yield
                                              -------   --------    -----       -------     --------     -----
<S>                                             <C>         <C>      <C>          <C>         <C>         <C>

Assets:
Earning Assets
  Loans (1) (2)                            $ 639,398   $ 10,952     6.87%    $ 484,536   $ 10,709       8.86%
  Taxable investments                         84,228      1,042     4.96%      102,866      1,558       6.08%
  Tax-exempt investments (tax equiv. basis)   49,143        838     6.84%       49,706        845       6.81%
  Federal funds sold                          17,553         78     1.78%       10,978        113       4.13%
                                             -------     ------                -------    -------
Total Earning Assets                         790,322   $ 12,910     6.55%      648,086   $ 13,225       8.18%
                                                         ------                           -------
Cash & due from banks                         49,562                            42,500
Other assets (4)                              14,091                            14,249
                                             -------                           -------
                                           $ 853,975                         $ 704,835
                                             =======                           =======

Liabilities & Shareholders' Equity:
Interest bearing liabilities:
  Demand deposits                          $ 135,929   $    362     1.07%    $  98,440   $    332       1.35%
  Savings                                    173,100        916     2.12%      123,679        984       3.19%
  Time deposits                              258,326      2,118     3.29%      245,628      3,413       5.57%
  Other borrowings                             6,863        122     7.13%        6,581         94       5.73%
                                             -------     ------                -------    -------
Total interest bearing liabilities           574,218      3,518     2.46%      474,328      4,823       4.08%
                                                         ------                           -------
Demand deposits                              203,259                           163,370
Other Liabilities                              5,909                             6,183
                                             -------                           -------
Total Liabilities                            783,386                           643,881
Shareholders' Equity                          70,589                            60,954
                                             -------                           -------
                                           $ 853,975                         $ 704,835
                                             =======                           =======
Net interest income & margin (3)                        $ 9,392     4.77%                $  8,402       5.20%
                                                         ======    ======                 =======       =====

--------------------------------------------------------------------------------------------------------------

(1)  Loan interest income includes fee income of $415,000 and  $347,000 for the three months
     ended June 30, 2002 and 2001, respectively.
(2)  Includes the average allowance for loan losses of $12,283,000 and $9,455,000 and average deferred
     loan fees of $1,186,000 and $966,000 for the three months ended June 30, 2002 and 2001, respectively.
(3)  Net interest margin is computed by dividing net interest income by the total average earning assets.
(4)  Includes the unrealized loss on available-for-sale securities.
</TABLE>
<PAGE>

<TABLE>
<CAPTION>

                                                             Six months ended June 30 ,
(Taxable Equivalent Basis)                            2002                                2001
                                          Avg.                    Avg.         Avg.                  Avg.
(In thousands, except percentages)     Balance      Interest    Yield       Balance     Interest   Yield
                                       -------      --------    -----       -------     --------   -----
<S>                                         <C>          <C>       <C>          <C>        <C>        <C>

Assets:
Earning Assets
  Loans (1) (2)                         $616,852    $21,044       6.88%     $473,106   $21,734      9.26%
  Taxable investments                     87,118      2,225       5.15%      103,173     3,247      6.35%
  Tax-exempt securities(tax equiv. basis) 49,378      1,683       6.87%       47,697     1,617      6.84%
  Federal funds sold                      17,764        147       1.67%       12,229       305      5.03%
                                          ------     ------                  -------    ------
Total Earning Assets                     771,112    $25,099       6.56%      636,205   $26,903      8.53%
                                                     ------                             ------
Cash & due from banks                     47,377                              42,089
Other assets (4)                          14,498                              14,552
                                          ------                             -------
                                        $832,987                            $692,846
                                          ======                             =======

Liabilities & Shareholders' Equity:
Interest bearing liabilities:
  Demand deposits                       $123,840    $   633       1.03%     $ 93,543   $   660      1.42%
  Savings                                156,115      1,675       2.16%      122,253     2,069      3.41%
  Time deposits                          273,529      4,621       3.41%      239,380     6,833      5.76%
  Other borrowings                         6,802        214       6.34%        6,147       187      6.13%
                                          ------     ------                  -------    ------
Total interest bearing liabilities       560,286      7,143       2.57%      461,323     9,749      4.26%
                                                     ------                             ------
Demand deposits                          197,674                             163,521
Other Liabilities                          5,968                               6,952
                                          ------                             -------
Total Liabilities                        763,928                             631,796
Shareholders' Equity                      69,059                              61,050
                                          ------                             -------
                                        $832,987                            $692,846
                                          ======                             =======
Net interest income & margin (3)                    $17,956       4.70%                $17,154      5.44%
                                                     ======       ====                  ======     ======

-----------------------------------------------------------------------------------------------------------

(1)  Loan interest income includes fee income of $801,000 and $679,000 for the six months
     ended June 30, 2002 and 2001, respectively
(2)  Includes the average allowance for loan losses of $12,123,000 and $9,434,000 and average deferred
     loan fees of $1,127,000 and $921,000 for the six months ended June 30, 2002 and 2001, respectively.
(3)  Net interest margin is computed by dividing net interest income by the total average earning assets.
(4)  Includes the unrealized loss on available-for-sale securities.
</TABLE>
















<PAGE>

<TABLE>
<CAPTION>

 Volume/Rate Analysis
(in thousands) Three Months Ended June 30, 2002 over 2001
Increase (decrease) due to change in:
                                                                         Net
                                          Volume          Rate (4)     Change
                                          ------          --------     ------
<S>                                         <C>             <C>           <C>

Interest-earning assets:
   Net Loans (1)(2)                      $ 3,421         $(3,178)      $  243
   Taxable investment securities            (283)           (233)        (516)
   Tax exempt investment securities (3)      (10)              3           (7)
   Federal funds sold                         68            (103)         (35)
                                         --------        --------      -------
     Total                                 3,196          (3,511)        (315)
                                         --------        --------      -------

Interest-bearing liabilities:
   Demand deposits                           126             (96)          30
   Savings deposits                          393            (461)         (68)
   Time deposits                             176          (1,471)      (1,295)
   Other borrowings                            4              24           28
                                         --------        --------      -------
     Total                                   699          (2,004)      (1,305)
                                         --------        --------      -------
Interest differential                    $ 2,497         $(1,507)      $  990
                                         ========        ========      =======


(in thousands) Six Months Ended June 30, 2002 over 2001
Increase (decrease) due to change in:
                                                                         Net
                                          Volume           Rate (4)    Change
                                          ------           --------    ------
Interest-earning assets:
   Net Loans (1)(2)                      $ 6,601         $(7,291)      $ (690)
   Taxable investment securities            (506)           (516)      (1,022)
   Tax exempt investment securities (3)       57               9           66
   Federal funds sold                        138            (296)        (158)
                                         --------         -------     --------
     Total                                 6,290          (8,094)      (1,804)
                                         --------         -------     --------

Interest-bearing liabilities:
   Demand deposits                           213            (240)         (27)
   Savings deposits                          573            (967)        (394)
   Time deposits                             975          (3,187)      (2,212)
   Other borrowings                           20               7           27
                                         --------         -------     --------
     Total                                 1,781          (4,387)      (2,606)
                                         --------         -------     --------
Interest differential                    $ 4,509         $(3,707)       $ 802
                                         ========         =======     ========

(1) The average balance of non-accruing loans is immaterial as a percentage of total loans and, as such,
    has been included in net loans.
(2) Loan fees of $415,000 and $347,000 for the quarters ended June 30, 2002 and 2001, and loan fees of
    $801,000 and $679,000 for the six months ended June 30, 2002 and 2001, respectively have been
    included in the interest income computation.
(3) Includes taxable-equivalent adjustments that relate to income on certain securities that are exempt from
    federal income taxes. The effective federal statutory tax rate was 35% for 2002 and 2001.
(4) The rate / volume variance has been included in the rate variance.
</TABLE>




<PAGE>



Net interest  income for the second quarter of 2002 was  $9,392,000,  which was
an  increase  of  $990,000  (11.8%)  over the second  quarter of 2001.  The net
interest  income for the second  quarter of 2002 was the highest  quarterly net
interest  income ever earned by the Company and was  reflective  of high growth
in  loans  and  lower  costs  on  interest-bearing  liabilities.  The  interest
income component  decreased  $315,000 (2.4%) on a quarter over quarter basis as
the 475 basis  points in rate  decreases  in 2001  continue to impact  interest
income.  Average loan balances were  $154,862,000  (32.0%) higher in the second
quarter of 2002  versus the same  quarter in the  previous  year.  This  volume
difference  added  $3,421,000 to interest  income.  However,  the average yield
earned on loans in the  second  quarter of 2002 was  6.87%,  a decrease  of 199
basis  points from the yield  earned in the second  quarter of 2001.  The lower
loan yield  decreased  interest  income by $3,178,000.  The average  balance of
taxable  investment  securities in the second  quarter of 2002 was  $18,638,000
(18.1%)  lower than it was in the  second  quarter  of 2001.  Average  balances
for  Federal  funds  sold  for  these  two  periods  increased   $6,575,000  to
$17,553,000.  Interest income for the investing  activities  decreased $558,000
on a period over period basis.

The  negative  effect on net  interest  income  caused  by the  lower  interest
income  was more than  offset by  decreases  in  interest  expense  on  deposit
liabilities.  Interest  expense  decreased  $1,305,000  (27.1%) as the  average
rate paid on  interest-bearing  liabilities  declined 162 basis points to 2.46%
for the  second  quarter  of 2002 as  compared  to 4.08%  in the  year  earlier
period.  This  decrease  in  rates  reduced  interest  expense  by  $2,004,000.
Average  balances  of  interest-bearing  liabilities  in the second  quarter of
2002  increased  by  $99,890,000  (21.1%)  over the prior  year  period.  These
higher balances added $699,000 to interest expense.

The net  interest  margin for the second  quarter of 2002 was 4.77% as compared
to 5.20% in the year  earlier  period.  The net  interest  margin in the second
quarter  of 2002  increased  15 basis  points  from the 4.62%  achieved  in the
first  quarter of 2002.  The favorable  change in net interest  margin from the
first quarter is  attributable to lower costs on  interest-bearing  liabilities
as  the  result  of  longer-term   certificates  maturing  and  repricing.  The
Federal  Reserve  board did not adjust  short-term  interest  rates  during the
first six months of 2002.  If interest  rates remain  stable for the balance of
2002, the net interest  margin is expected to show a slight  improvement.  In a
rising rate  environment  the net  interest  margin is expected to improve,  as
the Bank's  variable  rate assets are expected to reprice more quickly than the
interest-bearing liabilities.


For the six-month  period ending June 30, 2002, net interest  income  increased
$802,000  (4.7%)  over the  first  six  months  of 2001.  The  interest  income
component  decreased  $1,804,000 to  $25,099,000.  Average  balances of earning
assets were  $134,907,000  (21.2%)  higher in the first six months of 2002 than
the same  period  in 2001.  The  average  balance  of  loans  was  $143,746,000
higher,  which  contributed  $6,601,000 to interest  income.  The average yield
received  on loans in the first six months of 2002 was 238 basis  points  lower
than the 9.26%  received in the year earlier  period.  The lower yield on loans
decreased  interest  income by  $7,291,000.  The  average  balance  of  taxable
investment  securities was  $16,055,000  (15.6%) lower in the first  six-months
of 2002 than in the year earlier  period.  As  securities  matured the proceeds
were  utilized  to fund the  continued  loan  growth.  The  lower  balances  in
taxable  investments  decreased  interest  income  $506,000 and lower yields on
the investment  securities  decreased  interest income an additional  $516,000.
The changes in the  tax-exempt  investment  securities  and federal  funds sold
decreased interest income by an additional $92,000.

Interest  expense for the  six-month  period  ending  June 30,  2002  decreased
$2,606,000  (26.7%)  from  the  first  six  months  of 2001.  Average  interest
bearing  deposit  balances  in the first  six-months  of 2002 were  $98,308,000
(21.6%) higher than in the year earlier  period.  These volume  increases added
$1,761,000  to  interest  expense.  For the first six  months of 2002,  average
rates  paid on  interest  bearing  liabilities  was 2.57% for a decline  of 169
basis  points from the rates paid in the first  six-months  of 2001.  The lower
rates  resulted in a $4,387,000  decrease in interest  expense in the first six
months of 2002 from the prior year period.

Net  interest  margin  for the first  six  months  of 2002  decreased  74 basis
points to 4.70% from 5.44% in the year earlier period.



Provision for Loan Losses
-------------------------

The Bank  provided  $900,000  for loan losses in the second  quarter of 2002 as
compared to $75,000 in the second  quarter of 2001.  For the  six-month  period
ended June 30, 2002, the Bank provided  $1,123,000  compared to $195,000 in the
year earlier  period.  The  provision for loan losses that has been recorded is
based on  factors  which  consider  the loan  growth,  changes  in the level of
nonperforming  and  classified  assets,  changing  portfolio mix and prevailing
local and  national  economic  conditions  to establish  the required  level of
loan loss  reserves.  At June 30,  2002,  the ratio of the  allowance  for loan
losses to total loans was 1.93% as compared to 1.96% at March 31,  2002,  1.94%
at December  31, 2001 and 1.87% at June 30,  2001.  (See the "Credit  Risk" and
"Allowance for Loan Losses" sections for additional discussion.).

Noninterest Income
------------------

Noninterest  income consists  primarily of service charges on deposit  accounts
and fees for  miscellaneous  services.  Noninterest  income totaled $962,000 in
the  second  quarter  of 2002,  which  was up  $187,000  (24.1%)  over the same
period in 2001.  Service charges on deposit  accounts were up $104,000  (22.2%)
due to volume and  certain fee  increases.  Commissions  on mortgage  brokerage
services  decreased  $32,000  (27.0%) as mortgage  originations  and  refinance
activity  declined from the levels in the second  quarter of 2001.  The Company
realized net gains  totaling  $102,000 on the sale of investment  securities in
the second  quarter  of 2002 as  compared  to $4,000 in the  second  quarter of
2001.

For the first six-months of 2002,  noninterest  income was $1,729,000  compared
to  $1,425,000  in the same  period  last year.  Service  charges  on  deposits
were up $174,000  (19.3%)  due to higher  volumes and the effect of certain fee
increases.  Other fees were  $20,000  (4.7%)  higher in the first half of 2002.
The higher fees on other  services were offset in part by a $29,000  decline in
mortgage  brokerage  fees  as  the  activity  levels  decreased.   The  Company
realized net gains  totaling  $102,000 on the sale of investment  securities in
the first six-months of 2002 as compared to $3,000 in the same period of 2001.

Noninterest Expense
-------------------

As  compared  to the second  quarter of 2001,  noninterest  expenses  increased
$449,000  (9.4%)  to a total  of  $5,225,000  in the  second  quarter  of 2002.
Salary and employee  benefits  increased  $175,000 (6.1%) because of additional
staffing  for the new Gilroy  branch,  opened in April 2002,  internal  growth,
higher benefit costs,  and normal salary  increases.  On a quarter over quarter
basis,  occupancy  and fixed  asset  expenses  were  higher by $55,000  (6.5%).
Costs related to the new Gilroy branch,  expansion of the Hollister  branch and
higher  business  volume  contributed  to the increase.  Other expenses for the
second  quarter of 2002 totaled  $1,285,000,  which was an increase of $219,000
(20.5%)  from the  prior  year  quarter.  Increased  costs  were due to  higher
volumes and certain other  operational  losses.  The  efficiency  ratio for the
second  quarter of 2002 improved to 50.5% from  52.0%for the second  quarter of
2001.

Noninterest  expenses  for the  six-month  period  ending  June 30,  2002  were
$9,810,000  versus  $9,715,000 for the same period in 2001.  Salary and benefit
expenses were $5,795,000 in 2002 versus  $5,871,000 in the first  six-months of
2001.  The lower  costs  reflect a  $260,000  one-time  reduction  to  employee
health  care,  which was recorded in the first  quarter of 2002.  Even with the
opening  of the  Gilroy  branch  and the  expansion  of the  Hollister  branch,
occupancy and fixed asset  expenses were  relatively  flat with total  expenses
of  $1,741,000  for the first six months of 2002 as compared to  $1,733,000  in
the year earlier period.  Lower  depreciation  expenses in the first quarter of
2002 contributed to the small  year-to-date  increase in these expenses.  Other
expenses  increased  $163,000  (7.7%).  Approximately  half of the increase was
due to  certain  other  operational  losses  with  the  balance  due to  higher
business  volumes.  The  efficiency  ratio  for the  first  six  months of 2002
improved to 49.8% as compared to 52.3% for the same period of 2001.

Provision for Income Taxes
--------------------------

The effective tax rate,  considering  state and federal  taxes,  and tax exempt
income,  for  the  second  quarter  and  first  six-months  of 2002  was  35.5%
compared  to 37.6% and 37.5 for the same  periods in 2001.  The  estimated  tax
rates  in  2002  are  lower  as tax  exempt  loans  and  investment  securities
represent  a higher percentage of income.

Securities
----------

At  June  30,  2002,  available-for-sale  securities  had  a  market  value  of
$117,163,000  with an  amortized  cost basis of  $115,345,000.  On an amortized
cost  basis,  the  investment  portfolio  decreased  by  $17,856,000  from  the
balance at March 31, 2002 and  $22,522,000  from the  balance at  December  31,
2001.  Funds from the sale of  securities  and principal  payments  received on
mortgage  backed  securities  have been used in support of the  Company's  loan
growth.  The  unrealized  gain of  $1,818,000 at June 30, 2002  represented  an
increase of $2,367,000  from the unrealized  loss of $549,000 at March 31, 2002
and an  increase  of  $2,532,000  from  the  unrealized  loss  of  $714,000  at
December 31, 2001.  The  unrealized  gain was the result of the downward  shift
in the mid to long  term  rates in the yield  curve in the  second  quarter  of
2002.

Loans
-----

The  ending  loan  balance  at June 30,  2002 was  $675,036,000,  which  was an
increase  of   $68,736,000   (11.3%)  from  the   year-end   2001  balance  and
$166,938,000  (32.9%) from the June 30, 2001 balance.  All  categories of loans
have  increased  compared to the June 30, 2001 balances.  The most  significant
loan  growth  has been in the real  estate - other  category.  All  sectors  of
the  commercial  real  estate  market  in  Monterey  County  remain  relatively
strong.  Vacancy  rates are low and  economic  projections  expect the  vacancy
rates  to  remain  low as  there  is a lack of  appropriately  zoned  land  and
available  water and the political  pressures  are for slow growth.  Within its
primary  market  area,  the Bank has  diversified  its risk both as to property
type and  location.  See "Credit  Risk" below for a discussion  regarding  real
estate risk.

Credit Risk
-----------

The  Bank  assesses  and  manages  credit  risk  on an  ongoing  basis  through
stringent credit review and approval policies,  extensive  internal  monitoring
and  established  formal  lending  policies.  Additionally,  the Bank contracts
with an outside loan review  consultant to  periodically  examine new loans and
to review the  existing  loan  portfolio.  Management  believes  its ability to
identify  and assess  risk and return  characteristics  of the  Company's  loan
portfolio  is critical  for  profitability  and growth.  Management  strives to
continue the  historically  low level of loan losses by continuing its emphasis
on credit quality in the loan approval  process,  active credit  administration
and  regular  monitoring.  With  this in  mind,  management  has  designed  and
implemented a  comprehensive  loan review and grading  system that functions to
continually assess the credit risk inherent in the loan portfolio.

Ultimately,  the  credit  quality  of the  Bank's  loans may be  influenced  by
underlying  trends in the national and local economic and business cycles.  The
Bank's  business  is mostly  concentrated  in  Monterey  County.  The  County's
economy is highly  dependent on the agricultural  and tourism  industries.  The
agricultural  industry is also a major  driver of the  economies  of San Benito
County  and the  southern  portions  of Santa  Cruz and Santa  Clara  Counties,
which  represent the  additional  market areas for the Bank.  As a result,  the
Bank lends money to individuals and companies  dependent upon the  agricultural
and tourism industries.

The Company has  significant  extensions  of credit and  commitments  to extend
credit which are secured by real estate,  totaling  approximately  $541 million
at  June  30,   2002.   Although   management   believes   this   real   estate
concentration  has  no  more  than  the  normal  risk  of   collectibility,   a
substantial  decline in the  economy in  general,  or a decline in real  estate
values  in the  Bank's  primary  market  areas  in  particular,  could  have an
adverse  impact on the  collectibility  of these loans.  The ultimate  recovery
of these loans is generally  dependent  on the  successful  operation,  sale or
refinancing  of the real estate.  The Bank  monitors the effects of current and
expected  market  conditions  and other factors on the  collectibility  of real
estate loans.  When, in  management's  judgment,  these loans are impaired,  an
appropriate   provision   for  losses  is   recorded.   The  more   significant
assumptions  management  considers involve  estimates of the following:  lease,
absorption  and sale rates;  real estate values and rates of return;  operating
expenses;  inflation;  and  sufficiency  of collateral  independent of the real
estate including,  in limited instances,  personal guarantees.  Notwithstanding
the  foregoing,  abnormally  high rates of  impairment  due to general or local
economic  conditions  could adversely affect the Company's future prospects and
results of operations.

In extending credit and commitments to borrowers,  the Bank generally  requires
collateral  and/or  guarantees  as  security.  The  repayment  of such loans is
expected  to come  from cash flow or from  proceeds  from the sale of  selected
assets  of  the  borrowers.   The  Bank's  requirement  for  collateral  and/or
guarantees  is  determined  on  a   case-by-case   basis  in  connection   with
management's  evaluation of the  creditworthiness  of the borrower.  Collateral
held varies but may include accounts  receivable,  inventory,  property,  plant
and  equipment,   income-producing   properties,   residences  and  other  real
property.  The Bank  secures  its  collateral  by  perfecting  its  interest in
business assets,  obtaining deeds of trust, or outright  possession among other
means.  Loan  losses  from  lending  transactions  related  to real  estate and
agriculture  compare  favorably  with  the  Bank's  loan  losses  on  its  loan
portfolio as a whole.

Management  believes that its lending policies and underwriting  standards will
tend  to  mitigate  losses  in  an  economic  downturn;  however,  there  is no
assurance  that  losses  will not occur  under such  circumstances.  The Bank's
loan policies and underwriting  standards include,  but are not limited to, the
following:  1) maintaining a thorough  understanding of the Bank's service area
and  limiting  investments  outside of this  area,  2)  maintaining  a thorough
understanding   of  borrowers'   knowledge  and  capacity  in  their  field  of
expertise,  3)  basing  real  estate  construction  loan  approval  not only on
salability of the project,  but also on the borrowers'  capacity to support the
project  financially  in the  event  it  does  not  sell  within  the  original
projected  time  period,  and 4)  maintaining  conforming  and prudent  loan to
value and loan to cost  ratios  based on  independent  outside  appraisals  and
ongoing  inspection and analysis by the Bank's  construction  lending officers.
In  addition,   the  Bank  strives  to  diversify  the  risk  inherent  in  the
construction  portfolio by avoiding  concentrations to individual borrowers and
on any one project.

Nonaccrual, Past Due, Restructured Loans and Other Real Estate Owned (OREO)
---------------------------------------------------------------------------

Management  generally  places  loans on  nonaccrual  status when they become 90
days  past  due,  unless  the  loan  is  well  secured  and in the  process  of
collection.  When a loan is  placed  on  nonaccrual  status,  the  accrued  and
unpaid  interest  receivable  is reversed and the loan is accounted  for on the
cash or cost  recovery  method  thereafter,  until  qualifying  for  return  to
accrual  status.  Generally,  a loan may be returned to accrual status when all
delinquent  interest and principal  become current in accordance with the terms
of the loan  agreement and remaining  principal is  considered  collectible  or
when the loan is both well  secured  and in the  process of  collection.  Loans
are  charged  off  when,  in the  opinion  of  management,  collection  appears
unlikely.  The following table sets forth nonaccrual  loans,  loans past due 90
days or more,  restructured  loans performing in compliance with modified terms
and OREO at June 30, 2002 and December 31, 2001:

<TABLE>
<CAPTION>


(In thousands, except percentages)               June 30,  December 31,
                                                   2002          2001
                                                   ----          ----
<S>                                                  <C>          <C>
Past due 90 days or more and still accruing :
   Commercial                                      $     3      $    68
   Real estate                                         252            -
   Consumer and other                                    -           12
                                                 ----------    ---------
                                                       255           80
                                                 ----------    ---------
Nonaccrual:
   Commercial                                          641          702
   Real estate                                           -          592
   Consumer and other                                    -            -
                                                 ----------    ---------
                                                       641        1,294
                                                 ----------    ---------
Restructured (in compliance with modified
   terms)- Commercial                                  945          955
                                                 ----------    ---------
Total nonperforming and restructured loans           1,841        2,329
                                                 ----------    ---------
Other  real estate  owned                              592            -
                                                 ----------    ---------
Total nonperforming assets                       $   2,433     $  2,329
                                                 ==========    =========

Allowance for loan losses as a percentage of
  nonperforming and restructured loans                707%         505%
Nonperforming and restructured
  loans to total loans                               0.27%        0.38%
Allowance for loan losses to
  nonperforming assets                                535%         505%
Nonperforming assets to total assets                 0.28%        0.29%
</TABLE>


During the second  quarter of 2002,  the  Company  acquired  one OREO  property
with a value of $592,000.  Including  the OREO  property,  nonperforming  loans
increased  $165,000  from the March 31,  2002  balance  and  $104,000  from the
December 31, 2001 balance.  At June 30, 2002,  nonperforming  and  restructured
loans,  excluding the OREO property,  were 0.27% of total loans, which was down
from  0.37% at March 31,  2002 and 0.38% at  December  31,  2001.  The ratio of
nonperforming  assets  to total  assets  was 0.28% at June 30,  2002,  0.27% at
March 31, 2002 and 0.29% at December  31,  2001.  Subsequent  to June 30, 2002,
the Company  accepted an offer for the  purchase  of the OREO  property  and no
loss on the property is expected.

A loan is  impaired  when,  based on  current  information  and  events,  it is
probable  that the Company will be unable to collect all amounts due  according
to the  contractual  terms of the loan  agreement.  Impaired loans are measured
based on the present  value of expected  future  cash flows  discounted  at the
loan's  effective  interest  rate or, as a practical  expedient,  at the loan's
observable  market  price or the fair  value of the  collateral  if the loan is
collateral-dependent.

At June  30,  2002,  the  recorded  investment  in loans  that  are  considered
impaired  under SFAS No. 114 was  $1,714,000.  The total impaired loans include
$641,000 of nonaccrual  loans and $945,000 of  restructured  loans.  . Impaired
loans had valuation  allowances  totaling  $747,000.  At December 31, 2001, the
recorded  investment  in loans  considered  impaired was  $2,418,000,  of which
$1,294,000  was  included in  nonaccrual  loans and  $955,000  was  included in
restructured  loans.  The  impaired  loans at December  31, 2001 had  valuation
allowances  totaling  $536,000.  Management  is  not  aware  of  any  potential
problem  loans,  other than the  impaired  loans  disclosed  above,  which were
accruing and current at June 30,  2002,  where  serious  doubt exists as to the
ability of the borrower to comply with the present repayment terms.

Allowance for Loan Losses
-------------------------

The Bank  maintains an allowance for loan losses to absorb  losses  inherent in
the loan  portfolio.  The allowance is based on our regular  assessments of the
probable  estimated  losses  inherent  in the  loan  portfolio  and to a lesser
extent,  unused commitments to provide  financing.  Determining the adequacy of
the allowance is a matter of careful  judgment,  which  reflects  consideration
of all significant  factors that affect the  collectibility of the portfolio as
of the evaluation  date. Our methodology  for measuring the  appropriate  level
of the  allowance  relies on several key  elements,  which  include the formula
allowance,   specific   allowances  for   identified   problem  loans  and  the
unallocated  reserve.  The  unallocated  allowance  contains  amounts  that are
based on management's  evaluation of conditions that are not directly  measured
in the determination of the formula and specific allowances.

The formula  allowance is calculated  by applying  loss factors to  outstanding
loans and certain unused  commitments,  in each case based on the internal risk
grade  of  such  loans  and  commitments.   Changes  in  risk  grades  of  both
performing   and   nonperforming   loans  affect  the  amount  of  the  formula
allowance.  Loss factors are based on our  historical  loss  experience and may
be adjusted for  significant  factors that, in  management's  judgment,  affect
the  collectibility  of the  portfolio as of the  evaluation  date. At June 30,
2002,  the formula  allowance  was  $9,099,000  compared to $9,140,000 at March
31,  2002 and  $9,043,000  at December  31,  2001.  The slight  decrease in the
formula  allowance  during  the  second  quarter  was  primarily  a  result  of
reclassifying certain loans into the specific allowance category.

In addition to the  formula  allowance  calculated  by the  application  of the
loss factors to the standard loan categories,  certain specific  allowances may
also be  calculated.  Quarterly,  all  significant  classified  and  criticized
loans are analyzed  individually  based on the source and adequacy of repayment
and specific type of  collateral,  and an assessment is made of the adequacy of
the formula  reserve  relative to the  individual  loan. A specific  allocation
higher  or lower  than the  formula  reserve  will be  calculated  based on the
probability  of loss  and/or a  collateral  shortfall.  At June 30,  2002,  the
specific  allowance was $2,102,000 on a loan base of $33,466,000  compared to a
specific  allowance of  $1,435,000 on a loan base of  $17,473,000  at March 31,
2002 and a specific  allowance of $1,678,000 on a loan base of  $18,922,000  at
December 31,  2001.  The  $667,000  increase in the  specific  allowance in the
second  quarter of 2002 was primarily  attributable  to  establishing  specific
reserves for loans from two borrowers.

The  unallocated  allowance  contains  amounts  that are based on  management's
evaluation of conditions  that are not directly  measured in the  determination
of the formula and specific  allowances.  The  evaluation  of the inherent loss
with respect to these  conditions is subject to a higher degree of  uncertainty
because  they are not  identified  with  specific  problem  loans or  portfolio
segments.   At  June  30,  2002,  the  unallocated   allowance  was  $1,811,000
compared to $1,569,000  at March 31, 2002 and  $1,032,000 at December 31, 2001.
The conditions  evaluated in connection with the unallocated  allowance include
the following at the balance sheet date:


o     The current national and local economic and business  conditions,  trends
   and developments,  including the condition of various market segments within
   our lending area;

o     Changes  in  lending  policies  and  procedures,  including  underwriting
   standards and collection, charge-off, and recovery practices;

o     Changes  in the  nature,  mix,  concentrations  and  volume  of the  loan
   portfolio;

o     The effect of other external  factors such as  competition  and legal and
   regulatory  requirements  on the  level of  estimated  credit  losses in the
   Bank's current portfolio.

There can be no assurance  that the adverse  impact of any of these  conditions
on the Bank will not be in excess of the  unallocated  allowance as  determined
by management at June 30, 2002 and set forth in the preceding paragraph.

The allowance for loan losses  totaled  $13,012,000  or 1.93% of total loans at
June 30, 2002 compared to $12,144,000  or 1.96% at March 31, 2002,  $11,753,000
or 1.94% at December  31, 2001 and  $9,509,000  or 1.87% of total loans at June
30, 2001. At these dates, the allowance  represented  707%, 535%, 505% and 238%
of nonperforming loans.

It is the policy of  management  to maintain the allowance for loan losses at a
level   adequate  for  risks   inherent  in  the  loan   portfolio.   Based  on
information  currently  available  to analyze  loan loss  potential,  including
economic  factors,  overall  credit  quality,   historical  delinquency  and  a
history  of  actual  charge-offs,   management  believes  that  the  loan  loss
provision and allowance  are adequate.  However,  no prediction of the ultimate
level of loans charged off in future periods can be made with any certainty.

The following table summarizes activity in the allowance for loan losses for
the periods indicated:

<TABLE>
<CAPTION>
                          Three months ended     Six months ended
                               June 30,              June 30,
(In thousands, except     2002       2001         2002       2001
percentages)              ----       ----         ----       ----

<S>                        <C>         <C>         <C>        <C>

 Beginning balance       $12,144    $ 9,427      $11,753      9,371
   Provision charged to
    expense                  900         75        1,123        195
   Loans charged off         (43)       (17)         (96)      (104)
   Recoveries                 11         24          232         47
                         --------   --------     -------    -------
Ending balance           $13,012    $ 9,509      $13,012      9,509
                         ========   ========     =======    =======

Ending loan portfolio                           $675,036   $508,098
                                                 =======    =======

Allowance for loan losses as
percentage of ending loan portfolio                1.93%      1.87%
</TABLE>


Liquidity
---------

Liquidity  management  refers to the  Company's  ability to provide funds on an
ongoing  basis to meet  fluctuations  in  deposit  levels as well as the credit
needs  and   requirements   of  its  clients.   Both  assets  and   liabilities
contribute  to  the  Company's   liquidity   position.   Federal  funds  lines,
short-term  investments  and  securities,  and loan  repayments  contribute  to
liquidity,  along with  deposit  increases,  while  loan  funding  and  deposit
withdrawals   decrease   liquidity.   The  Bank  assesses  the   likelihood  of
projected  funding  requirements  by  reviewing  historical  funding  patterns,
current and  forecasted  economic  conditions  and  individual  client  funding
needs.  Commitments  to fund loans and  outstanding  standby  letters of credit
at  June   30,   2002   were   approximately   $201,662,000   and   $6,148,000,
respectively.  Such loans relate  primarily  to  revolving  lines of credit and
other commercial loans, and to real estate construction loans.

The  Company's  sources  of  liquidity  consist  of  overnight  funds  sold  to
correspondent  banks,  unpledged marketable  investments,  loans pledged to the
Federal  Home Loan Bank of San  Francisco  ("FHLB-SF")  and sellable SBA loans.
On June 30, 2002,  consolidated  liquid assets  totaled $124.9 million or 14.3%
of total  assets as compared to $110.0  million or 13.7% of total  consolidated
assets  on  December  31,  2001.  In  addition  to  liquid  assets,   the  Bank
maintains  short-term  lines of credit with  correspondent  banks.  At June 30,
2002, the Bank had  $80,000,000  available  under these credit lines.  Informal
agreements   are  also  in  place  with   various   other   banks  to  purchase
participations  in  loans,  if  necessary.   The  Company  serves  primarily  a
business  and  professional  customer  base and, as such,  its deposit  base is
susceptible  to  economic  fluctuations.  Accordingly,  management  strives  to
maintain  a  balanced  position  of liquid  assets  to  volatile  and  cyclical
deposits.

Capital Resources
-----------------

The  Company's  total  shareholders'  equity was  $72,352,000  at June 30, 2002
compared to $65,336,000 at December 31, 2001.

The  Company  and the Bank are  subject to  regulations  issued by the Board of
Governors  and the  FDIC  which  require  maintenance  of a  certain  level  of
capital.  Under  the  regulations,  capital  requirements  are  based  upon the
composition  of an  institution's  asset base and the risk factors  assigned to
those assets.  The guidelines  characterize an  institution's  capital as being
"Tier  1"  capital  (defined  to  be  principally   shareholders'  equity  less
intangible  assets)  and  "Tier  2"  capital  (defined  to be  principally  the
allowance  for loan  losses,  limited  to one and  one-fourth  percent of gross
risk  weighted  assets).  The  guidelines  require  the Company and the Bank to
maintain a risk-based  capital  target  ratio of 8%,  one-half or more of which
should be in the form of Tier 1 capital.

The following  table shows the Company's and the Bank's actual capital  amounts
and  ratios  at June 30,  2002 and  December  31,  2001 as well as the  minimum
capital ratios for capital adequacy under the regulatory framework:

<TABLE>
<CAPTION>
                                                                                                    To Be Categorized
                                                                                                  Well Capitalized Under
                                                                              For Capital           Prompt Corrective
                                                        Actual:            Adequacy Purposes:       Action Provisions:
                                                Amount         Ratio       Amount       Ratio       Amount       Ratio
                                                ------         -----       ------       -----       ------       -----
<S>                                                <C>          <C>         <C>          <C>         <C>          <C>
Company
-------
As of June 30, 2002
-------------------
Total Capital (to Risk Weighted Assets):      $80,063,000     10.9%      $58,585,000     8.0%        N/A
Tier 1 Capital (to Risk Weighted Assets):      70,862,000      9.7%       29,292,000     4.0%        N/A
Tier 1 Capital (to Average Assets):            70,862,000      8.3%       34,141,000     4.0%        N/A

As of December 31, 2001:
------------------------
Total Capital (to Risk Weighted Assets):       73,518,000     11.1%       52,971,000     8.0%        N/A
Tier 1 Capital (to Risk Weighted Assets):      65,198,000      9.9%       26,486,000     4.0%        N/A
Tier 1 Capital (to Average Assets):            65,198,000      8.4%       30,896,000     4.0%        N/A

Community Bank
--------------
As of June 30, 2002:
--------------------
Total Capital (to Risk Weighted Assets):      $73,352,000     10.1%      $58,030,000     8.0%     $72,538,000    10.0%
Tier 1 Capital (to Risk Weighted Assets):      64,236,000      8.9%       29,015,000     4.0%      43,523,000     6.0%
Tier 1 Capital (to Average Assets):            64,236,000      7.6%       33,787,000     4.0%      42,234,000     5.0%

As of December 31, 2001:
------------------------
Total Capital (to Risk Weighted Assets):       65,318,000     10.0%       52,202,000     8.0%      65,252,000    10.0%
Tier 1 Capital (to Risk Weighted Assets):      57,117,000      8.8%       26,101,000     4.0%      39,151,000     6.0%
Tier 1 Capital (to Average Assets):            57,117,000      7.5%       30,470,000     4.0%      38,088,000     5.0%
</TABLE>

The Bank meets the "well  capitalized"  ratio  measures  at both June 30,  2002
and December 31, 2001.

                        Item 3. MARKET RISK MANAGEMENT

Overview
--------

The goal for  managing  the assets and  liabilities  of the Bank is to maximize
shareholder  value and earnings while  maintaining a high quality balance sheet
without  exposing the Bank to undue  interest rate risk. The Board of Directors
has overall  responsibility  for the Company's  interest  rate risk  management
policies.  The Bank has an Asset and  Liability  Management  Committee  (ALCO),
which  establishes  and  monitors  guidelines  to control  the  sensitivity  of
earnings to changes in interest rates.

Asset/Liability Management
--------------------------

Activities  involved in asset/liability  management include but are not limited
to lending,  accepting  and  placing  deposits,  investing  in  securities  and
issuing debt.  Interest rate risk is the primary  market risk  associated  with
asset/liability  management.  Sensitivity  of earnings to interest rate changes
arises  when  yields  on  assets  change  in a  different  time  period or in a
different  amount  from that of  interest  costs on  liabilities.  To  mitigate
interest  rate risk,  the  structure  of the balance  sheet is managed with the
goal  that  movements  of  interest  rates  on  assets  and   liabilities   are
correlated  and  contribute  to earnings  even in periods of volatile  interest
rates.  The  asset/liability  management  policy sets limits on the  acceptable
amount of  variance in net  interest  margin and market  value of equity  under
changing  interest  environments.  The Bank uses simulation  models to forecast
earnings, net interest margin and market value of equity.

Simulation of earnings is the primary tool used to measure the  sensitivity  of
earnings to interest rate changes.
Using  computer  modeling  techniques,  the  Company  is able to  estimate  the
potential  impact of  changing  interest  rates on  earnings.  A balance  sheet
forecast is prepared  using  inputs of actual  loan,  securities  and  interest
bearing  liabilities  (i.e.  deposits/borrowings)  positions  as the  beginning
base.  The forecast  balance  sheet is processed  against  three  interest rate
scenarios.  The  scenarios  include a 200 basis point rising rate  forecast,  a
flat rate  forecast  and a 200 basis point  falling  rate  forecast  which take
place  within a one year  time  frame.  The net  interest  income  is  measured
during the first year of the rate  changes and in the year  following  the rate
changes.  The  latest  simulation  forecast  using May 31,  2002  balances  and
measuring  against  a flat  rate  environment,  calculated  that in a  one-year
horizon an increase in interest  rates of 200 basis  points  would result in an
increase of $3,393,000 in net interest  income.  Conversely,  a 200 basis point
decrease  would  result in a decrease of  $3,522,000  in net  interest  income.
The basic  structure of the balance  sheet has not changed  significantly  from
the last simulation run.

The simulations of earnings do not incorporate  any management  actions,  which
might  moderate  the  negative   consequences  of  interest  rate   deviations.
Therefore,   they  do  not  reflect  likely  actual   results,   but  serve  as
conservative  estimates  of interest  rate risk.  The risk  profile of the Bank
has not changed materially from that at year-end 2001.

Other Matters
-------------

Terrorist Acts

The  terrorist   actions  on  September  11,  2001  and  thereafter   have  had
significant  adverse  effects  upon the  United  States  economy.  Whether  the
terrorist  activities  in the future and the  actions of the United  States and
its allies in combating  terrorism on a worldwide  basis will adversely  impact
the Company and the extent of such impact is  uncertain.  However,  such events
have had and may  continue  to have an  adverse  effect on the  economy  in the
Company's   market  areas.   Such  continued   economic   deterioration   could
adversely  affect the Company's  future  results of operations  by, among other
matters,  reducing  the  demand  for  loans  and other  products  and  services
offered  by  the  Company,  increasing  nonperforming  loans  and  the  amounts
reserved for loan losses, and causing a decline in the Company's stock price.

Off-Balance Sheet Items

The Company has certain  ongoing  commitments  under  operating  leases.  These
commitments  do not  significantly  impact  operating  results.  As of June 30,
2002 and  December  31,  2001,  commitments  to extend  credit  and  letters of
credit were the only financial  instruments  with  off-balance  sheet risk (See
footnote 2 in the  financial  statements).  The Company  has not  entered  into
any contracts  for financial  derivative  instruments  such as futures,  swaps,
options or similar instruments.

Certain  financial  institutions  have elected to use special purpose  vehicles
("SPV") to dispose of problem assets.  A SPV is typically a subsidiary  company
with  an  asset  and  liability  structure  and  legal  status  that  makes  it
obligations  secure even if the parent  corporation  goes  bankrupt.  Under the
circumstances,  these  financial  institutions  may exclude the problem  assets
from their reported impaired and  non-performing  assets.  The Company does not
use SPV or other structures to dispose of problem assets.

Subsequent Events
-----------------

President George W. Bush signed the  Sarbanes-Oxley  Act of 2002 (the "Act") on
July 30, 2002,  which  responds to recent  issues in corporate  governance  and
accountability.  Among other matters, key provisions of the Act provide for:

o     Expanded  oversight  of  the  Accounting  Profession  by  creating  a new
      independent oversight board to be monitored by the SEC.
o     Revised  rules  on  auditor   independence  to  restrict  the  nature  of
      non-audit  services  provided  to  audit  clients  and  to  require  such
      services to be pre-approved by the audit committee.
o     Improved  corporate  responsibility  through  mandatory listing standards
      relating to audit  committees,  certifications of periodic reports by the
      CEO and CFO,  and makes it a crime for an  issuer  to  interfere  with an
      audit.
o     Enhanced  financial  disclosures,  including periodic reviews for largest
      issuers and real time disclosure of material company information.
o     Enhanced criminal  penalties for a broad array of white collar crimes and
      increases in the statute of limitations for securities fraud lawsuits.

The effect of the Act upon  corporations  is uncertain;  however,  it is likely
that  compliance  costs may  increase  as  corporations  modify  procedures  if
required  to  conform  to the  provisions  of the  Act.  The  Company  does not
currently  anticipate  that compliance with the Act will have a material effect
upon its financial position or results of its operations or its cash flows.



<PAGE>


                          PART II - OTHER INFORMATION

Item 1.    Legal proceedings.

                None.

Item 2.     Changes in securities.

                None.

Item 3.     Defaults upon senior securities.

                None.

Item 4.     Submission of matters to a vote of security holders.

           THE FOLLOWING ARE THE VOTING RESULTS OF THE REGISTRANTS'S  ANNUAL
           MEETING OF THE SHAREHOLDERS HELD ON MAY 23, 2002:

           PROPOSAL NO. 1: ELECTION OF DIRECTORS

                                           AFFIRMATIVE   VOTES
                                                      -
           NOMINEE                           VOTES       WITHHELD
           -------                           -----       --------

           ALFRED P. GLOVER (Class 1)      6,482,593      25,791
           LOUIS A. SOUZA                  6,478,152      30,252
                     (Class 1)
           MOSE E. THOMAS, JR. (Class 1)   6,477,269      31,115

           PROPOSAL NO.2: APPROVAL OF THE APPOINTMENT OF DELOITTE & TOUCHE LLP
           AS INDEPENDENT PUBLIC ACCOUNTANTS FOR THE 2002 FISCAL YEAR

              FOR 6,390,890 AGAINST   90,057    ABSTAIN   27,437

           TOTAL NUMBER OF SHARES VOTED: 6,508,384.


           IN ADDITION, THE FOLLOWING DIRECTORS CONTINUE IN OFFICE AS MEMBERS
           OF THE CLASS  DESIGNATED AND WERE NOT SUBJECT TO SHAREHOLDER
           ELECTION AT THIS TIME:

           MICHAEL T. LAPSYS (Class 2)
           DUNCAN L. McCARTER (Class 2)
           NICK VENTIMIGLIA (Class 2)
           C. EDWARD BOUTONNET (Class 3)
           BRADFORD G. CRANDALL (Class 3)
           ROBERT M. MRAULE, D.D.S., M.D.(Class 3)

Item 5.     Other information.

                None.

Item 6.     Exhibits and reports on Form 8-K.

(a)   Exhibits
<TABLE>
<S>        <C>

           (2.1)     Agreement and Plan of Reorganization  and Merger by and between
                Central  Coast  Bancorp,  CCB Merger  Company and Cypress Coast
                Bank dated as of December 5,  1995,  incorporated  by reference
                from Exhibit  99.1 to Form 8-K,  filed with the  Commission  on
                December 7, 1995.

           (3.1)     Articles of  Incorporation,  as amended,  incorporated  by reference from
                Exhibit  10.18 to the  Registrant's  2001 Annual Report on Form
                10-K filed with the Commission on March 26, 2002.

           (3.2)     Bylaws, as amended,  incorporated by reference from Exhibit 3.2
                to Form 10-Q, filed with the Commission on August 13, 2001.

           (4.1)     Specimen form of Central Coast  Bancorp stock  certificate,  incorporated
                by reference
                from the  Registrant's  1994  Annual  Report on Form 10-K filed
                with the Commission on March 31, 1995.

           (10.1)    Lease agreement dated December 12, 1994, related to 301 Main Street, Salinas,
                California incorporated by reference from the Registrant's
                1994 Annual Report on Form 10-K filed with the Commission on
                March 31, 1995.

           (10.2)    King City Branch Lease incorporated by reference from Exhibit 10.3 to Registration
                Statement on Form S-4, No. 33-76972, filed with the Commission
                on March 28, 1994.

           (10.3)    Amendment to King City Branch Lease, incorporated by reference from Exhibit 10.4
                to Registration Statement on Form S-4, No. 33-76972, filed
                with the Commission on March 28, 1994.

          *(10.4)    1982 Stock Option Plan, as amended, incorporated by
                reference from Exhibit 4.2 to Registration Statement on Form
                S-8, No. 33-89948, filed with the Commission on March 3, 1995.

          *(10.5)    Form of  Nonstatutory  Stock Option  Agreement under the 1982
                Stock Option Plan  incorporated  by reference  from Exhibit 4.6
                to  Registration  Statement  on Form S-8, No.  33-89948,  filed
                with the Commission on March 3, 1995.

          *(10.6)    Form of Incentive Stock Option Agreement under the 1982 Stock Option Plan incorporated
                by reference from Exhibit 4.7 to Registration Statement on
                Form S-8, No. 33-89948, filed with the Commission on March 3,
                1995.

          *(10.7)    1994 Stock Option Plan, as amended and restated, incorporated by reference from
                Exhibit 9.9 to Registration Statement on Form S-8, No.
                33-89948, filed with the Commission on November 15, 1996.

          *(10.8)    Form of Nonstatutory Stock Option Agreement under the 1994 Stock Option Plan incorporated
                by reference from Exhibit 4.3 to Registration Statement on
                Form S-8, No. 33-89948, filed with Commission on March 3,
                1995.

          *(10.9)    Form of Incentive Stock Option Agreement under the 1994 Stock Option Plan incorporated
                by reference from Exhibit 4.4 to Registration Statement on
                Form S-8, No. 33-89948, filed with the Commission on March 3,
                1995.

         *(10.10)    Form of Director Nonstatutory Stock Option Agreement under the 1994 Stock Option
                Plan incorporated by reference from Exhibit 4.5 to
                Registration Statement on Form S-8, No. 33-89948, filed with
                the Commission on March 3, 1995.

         *(10.11)    Form of Bank of Salinas Indemnification Agreement for directors and executive officers
                incorporated by reference from Exhibit 10.9 to Amendment No. 1
                to Registration Statement on Form S-4, No. 33-76972, filed
                with the Commission on April 15, 1994.

         *(10.12)    401(k) Pension and Profit Sharing Plan Summary Plan Description incorporated by
                reference from Exhibit 10.8 to Registration Statement on Form
                S-4, No. 33-76972, filed with the Commission on March 28, 1994.

         *(10.13)    Form of Executive Employment Agreement incorporated by reference from Exhibit 10.13
                to the Company's 1996 Annual Report on Form 10-K filed with
                the Commission on March 31, 1997.

         *(10.14)    Form of Executive Salary Continuation Agreement incorporated by reference from Exhibit
                10.14 to the Company's 1996 Annual Report on Form 10-K filed
                with the Commission on March 31, 1997.

         *(10.15)    Form of Indemnification Agreement incorporated by reference from Exhibit D to the
                Proxy Statement filed with the Commission on September 3,
                1996, in connection with Registrant's 1996 Annual
                Shareholders' Meeting held on September 23, 1996.

          (10.16)    Purchase and Assumption Agreement for the Acquisition of Wells Fargo Bank Branches
                incorporated by reference from Exhibit 10.17 to the
                Registrant's 1996 Annual Report on Form 10-K filed with the
                Commission on March 31, 1997.

          (10.17)    Lease  agreement  dated November 27, 2001 related to 491 Tres
                Pinos Road,  Hollister,  California  incorporated  by reference
                from Exhibit  10.17 to the  Registrant's  2001 Annual Report on
                Form 10-K filed with the Commission on March 26, 2002.

          (10.18)    Lease  agreement  dated February 11, 2002,  related to 761
                First  Street,  Gilroy,  California  incorporated  by reference
                from Exhibit  10.18 to the  Registrant's  2001 Annual Report on
                Form 10-K filed with the Commission on March 26, 2002.

          (10.19)    Lease  agreement  dated  July  16,  2002,  related  to 439
                Alvarado Street, Monterey, California.

          (21.1)     The  Registrant's  only subsidiary is its  wholly-owned  subsidiary,
                Community Bank of Central California.

          (99.1)     Certification of Chief Executive Officer and Chief Financial
                Officer pursuant to the Sarbanes-Oxley Act of 2002
</TABLE>


               *Denotes   management    contracts,    compensatory   plans   or
               arrangements.

(b)   Reports on Form 8-K.

           None

<PAGE>



SIGNATURES
-------------------------------------------------------------------------------


Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.


August 2, 2002                            CENTRAL COAST BANCORP


                                    By:   /s/ ROBERT M. STANBERRY
                                      ----------------------------------
                                          Robert M. Stanberry
                                          (Chief Financial Officer, Principal
                                          Financial and Accounting Officer)






<PAGE>





                         EXHIBIT INDEX


Exhibit                                                           Sequential
Number                    Description                            Page Number


10.19       Lease agreement dated July 16, 2002, related to              29
            439 Alvarado Street, Monterey, California

99.1        Certification of Chief Executive Officer and Chief Financial 72
            Officer pursuant to the Sarbanes-Oxley Act of 2002