That's roughly double the net income of $200,383, or 25 cents per share, for the same period of 2002 reported by the parent of Pacific State Bank, a commercial bank, primarily serving small- and middle-market businesses.

Primary contributing factors were strong growth in commercial and real estate loans, as well as additional non-interest income from loan fees and selling loans into secondary markets, bank officials said.

"We're bigger than we were a year ago at the same time, and our loans went up," said Steven A. Rosso, company president and chief executive. Also, he noted that 2002 earnings were somewhat depressed by costs associated with the acquisition of the California Bank and Trust office in Stockton.

Pacific State's net loan portfolio grew to $141.5 million on March 31, up 38 percent from $102.2 million one year earlier. Both net interest and non-interest income rose about 35 percent over the same period.

Also, as of March 31, Pacific State assets totaled $190.2 million, up nearly 32 percent from assets of $144.6 million a year ago.

Rosso said the bank is seeing a surge in the commercial business market, both in commercial real estate and in traditional business loans. It is also benefiting from demand for construction loans, new mortgages and mortgage refinancing, all driven by current low interest rates.

"It's been a really good real estate market in San Joaquin, Stanislaus Calaveras and Tuolumne counties," he said.

Pacific State Bank serves that region from offices in Stockton, Angels Camp, Arnold, Groveland, Tracy and Modesto.

Rosso noted that he's seen signs that some of his agricultural customers are beginning to receive better prices for their commodities, and he expects overall growth in the region to continue.

"Our projections are for a real strong year for the bank and for the communities we serve," he said.

By Reed Fujii