EXHIBIT 5.1



                 [LETTERHEAD OF FOSTER PEPPER & SHEFELMAN LLP]


                               September 27, 2002


Board of Directors
Umpqua Holdings Corporation
200 SW Market Street, Suite 1900
Portland, Oregon 97201

      Re:   Merger with Centennial Bancorp

Ladies and Gentlemen:

      This firm has acted as counsel to Umpqua Holdings Corporation in
connection with a proposed merger (the "Merger") in which Centennial Bancorp
would be merged with and into Umpqua Holdings Corporation (the "Company")
pursuant to an Agreement and Plan of Reorganization dated July 22, 2002, and an
accompanying Plan of Merger (together, the "Plan"), and in connection with the
preparation and filing with the Securities and Exchange Commission of a
registration statement on Form S-4 (the "Registration Statement") covering the
shares of Company common stock (the "Shares") to be issued to shareholders of
Centennial Bancorp in the Merger in exchange for shares of Centennial Bancorp
common stock. Capitalized terms not otherwise specifically defined herein have
the meanings given them in the Plan.

      In the course of our representation we have examined the Registration
Statement, the Plan, copies of the Articles of Incorporation, Bylaws, and
excerpts of minutes of meetings of the Board of Directors of the Company. We
have also received from officers of the Company certain other documents,
corporate records, certificates and representations concerning factual matters.
We have reviewed such documents and certificates, made such inquiries of public
officials, and made such review of laws as we consider necessary for purposes of
this opinion. We have relied as to matters of fact upon the above documents and
investigation. We have assumed without investigation the genuineness of all
signatures, the authenticity and completeness of all documents submitted to us
as originals and the conformity to authentic and complete original documents of
all documents submitted to us as certified or photostatic copies.

      Based upon the foregoing and subject to the qualifications and exceptions
heretofore and hereinafter set forth, we are of the opinion that the Shares have
been duly authorized by the Company, and that when the Registration Statement is
declared effective by the Securities and Exchange Commission, the Merger is
consummated, and the Company has issued the Shares in the manner provided in the
Plan and as described the Registration Statement, the Shares will be validly
issued, fully paid and non-assessable.


September 27, 2002
Page 2

      This opinion is limited to the laws of the State of Oregon and applicable
federal laws of the United States of America, and to the facts bearing on this
opinion as they exist on the date of this letter. We disclaim any obligation to
review or supplement this opinion or to advise you of any changes in the
circumstances, laws or events that may occur after this date or otherwise update
this opinion.

      We consent to the use of this opinion as an exhibit to the Registration
Statement, and we consent to the reference to our name under the caption "Legal
Matters" in the proxy statement/prospectus forming a part of the Registration
Statement. In giving this consent, we do not admit that we are within the
category of persons whose consent is required under Section 7 of the Act or the
General Rules and Regulations of the Securities and Exchange Commission.

                                Very truly yours,

                                /s/ Foster Pepper & Shefelman LLP
                                --------------------------------------------
                                FOSTER PEPPER & SHEFELMAN LLP