8-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) October 21, 2003

SIERRA BANCORP

(Exact name of registrant as specified in its charter)

California	000-33063	33-0937517
(State or other jurisdiction of incorporation or organization)	(Commission File No.)	(I.R.S. Employee Identification No.)

86 North Main Street, Porterville, CA 93257

(Address of principal executive offices) (Zip code)

(559) 782-4900

(Registrant’s telephone number including area code)

Not applicable

(Former name or former address, if changed since last report)

Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.

(c) Exhibits

99.1 Press release concerning third quarter 2003 financial results.

Item 9. Other Events and Required Regulation FD Disclosure.

On October 21 2003, Sierra Bancorp issued a press release concerning its results of operations and financial condition as of and for the calendar quarter ended September 30, 2003. This information is being furnished pursuant to “Item 12. Results of Operations and Financial Condition” of Form 8-K. A copy of the press release is furnished herewith as Exhibit 99.1.

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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 hereunto duly authorized.

	SIERRA BANCORP
Dated: October 22, 2003	By:	/s/    Kenneth R. Taylor
		Kenneth R. Taylor Senior Vice President & Chief Financial Officer

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EXHIBIT INDEX

Exhibit No.	Description	Page
99.1	Press release concerning results of operations and financial condition as of and for the calendar quarter ended September 30, 2003.	5

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EX-99.1

EXHIBIT 99.1

SIERRA BANCORP THIRD QUARTER EARNINGS JUMP 33% TO $3.0 MILLION

Branch Expansion Generates Double Digit Growth in Loans, Deposits and Revenues

Porterville, CA—October 21, 2003—Sierra Bancorp (Nasdaq: BSRR), parent of Bank of the Sierra, today announced it generated record third quarter earnings with total revenues, loans and deposits all rising 16%. Third quarter net income rose 33% to $3.0 million, or $0.30 per diluted share, compared to $2.3 million, or $0.24 per diluted share, in the third quarter of 2002. Year-to-date net income rose 19% to $8.0 million, or $0.80 per diluted share, compared to $6.7 million, or $0.69 per diluted share, in the first nine months of 2002. Sierra Bancorp generated a return on average equity of 20.92% in the third quarter and 19.19% year-to-date. Its return on average assets was 1.62% in the quarter and 1.50% year-to-date.

“For success, attitude is equally as important as ability.” Harry F. Banks www.quotablequotes.net

“Success in banking is truly as much about attitude as it is ability. Banking is all about service, and excellent service is not just in taking the action to meet customers’ needs, but also in doing so with a friendly and respectful attitude. Our customer service front-liners are truly excellent at making our customers feel welcome and respected, and our managers work hard to support them in these efforts,” said James C. Holly, President and CEO. “Our third quarter results reflect the solid abilities and great attitudes of our team members.”

Pretax income increased 62% to $4.1 million in 3Q03 and was up 17% at $10.8 million year-to-date. The company’s provision for income taxes was significantly lower in the year ago quarter due to the recognition of retroactive tax benefits from capital enhancement strategies initiated in August 2002. The third quarter tax provision was 26.3% of pre-tax income compared to 10.3% of pretax income in 3Q02. Year-to-date, the provision for income taxes was 25.8% of pretax income compared to 26.8% of pretax income in the year ago period.

Operating Results

“A widening margin, improved efficiencies and solid growth in loans and core deposits contributed to the strong performance generated in the third quarter and year-to-date,” said Kenneth Taylor, Chief Financial Officer. Third quarter revenues (net interest income before provision for loan losses plus non-interest income) grew 16% to $12.0 million compared to $10.4 million in the third quarter a year ago. Year-to-date revenues are up 9% to $33.5 million from $30.8 million in the first nine months for 2002.

The company’s net interest margin for the third quarter of 2003 expanded 6 basis points to 5.72% (tax equivalent) and improved 8 basis points to 5.69% (tax equivalent) year-to-date. “In light of the difficult interest rate environment, the modest improvement in net interest margin is noteworthy,” said Taylor.

Net interest income in the third quarter increased 10% to $9.3 million compared to $8.4 million in the third quarter a year ago. In the first nine months of 2003, net interest income grew 6% to $26.1 million compared to $24.6 million in the like period of 2002. Operating (non-interest) income grew 38% in the third quarter and 19% year-to-date boosted by growth in service charges from an expanded account base and contributions from bank-owned life insurance, most of which was purchased in late September and early October 2002.

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Sierra Bancorp Reports Record 3Q03 Profits

October 21, 2003

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Operating (non-interest) expense increased 2% in the quarter to $7.1 million from $6.9 million in the third quarter a year ago. Year-to-date operating expense grew 9% to $20.8 million from $19.2 million in the first nine months of 2002. “Our expansion in the Fresno market is going very well, with a second branch in North Fresno that opened in April and a branch scheduled to open in Clovis early next year. The investment in new branches has been partially offset by improved efficiencies from the new operating technology implemented last year,” said Holly. In September 2002 the company converted to in-house item processing and relocated and enhanced its information technology center, which helped increase efficiency and lowered other non-interest expenses but added to compensation and occupancy costs. In the third quarter compensation expenses increased 11% and occupancy costs grew 22%, while other overhead costs dropped 16%. Year-to-date compensation and occupancy costs both grew 21% and other overhead costs dropped 11%. The bank’s efficiency ratio improved to 57.4% in the third quarter and to 60.4% in the first nine months of 2003 from 65.1% and 60.8% in the respective periods of 2002.

Balance Sheet Growth (at September 30, 2003)

Assets increased 12% to $762 million from $682 million a year ago. Net loans grew 16% to $578 million from $497 million. Real estate loans grew 20% and accounted for 69% of gross loans. Commercial and industrial loans grew 17% and account for 16% of the total loan portfolio.

Non-performing assets were $8.4 million, or 1.10% of total assets, compared to $6.6 million, or 0.96% a year ago. At quarter end, the allowance for loan losses stood at $6.2 million, or 1.05% of total loans compared to $5.3 million, or 1.06% of total loans a year ago. Excluding balances guaranteed by the U.S. government, non-performing assets were $7.0 million, or 0.92% of total assets compared to $5.6 million, or 0.82% of assets a year ago.

Deposits grew 16% to $660 million, with demand deposits up 27%, NOW and savings accounts up 18%, money market accounts up 25%, and time deposits up 4%. Low cost deposits accounted for 65% of total deposits at quarter end compared to 60% a year ago.

About Sierra Bancorp

Sierra Bancorp is the holding company for Bank of the Sierra, the largest independent bank headquartered in the South San Joaquin Valley. The Bank operates seventeen branch offices, as well as two agricultural credit centers and a bank card center. In 2003, Sierra Bancorp was added to the Russell 2000 Index and US Banker magazine ranked BSRR as the nation’s 24^th best performing bank over the past three years based on its three-year return on equity. More information about Bank of the Sierra is available on the Bank’s web site, www.bankofthesierra.com.

The statements contained in this release that are not historical facts are forward-looking statements based on management’s current expectations and beliefs concerning future developments and their potential effects on the Company. Readers are cautioned not to unduly rely on forward looking statements. Actual results may differ from those projected. These forward-looking statements involve risks and uncertainties the impact of current events on the California economy, the bank’s ability to attract and retain skilled employee, customers’ service expectations, the bank’s ability to successfully expand geographically, changes in interest rates, loan portfolio performance and other factors detailed in the Company’s SEC filings.

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Sierra Bancorp Reports Record 3Q03 Profits

October 21, 2003

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INCOME STATEMENT	3-Month Period Ended						% Change		9-Month Period Ended						% Change
($ in 000s except per share) (unaudited)	Sept. 30, 2003			Sept. 30, 2002					Sept. 30, 2003			Sept. 30, 2002
Interest Income	$	10,915		$	10,635		2.6	%	$	31,377		$	31,524		-0.5	%
Interest Expense		1,629			2,226		-26.8	%		5,286			6,961		-24.1	%
Net Interest Income		9,286			8,409		10.4	%		26,091			24,563		6.2	%
Provision for Loan & Lease Losses		800			900		-11.1	%		1,925			2,450		-21.4	%
Net Int after Loan Loss Prov		8,486			7,509		13.0	%		24,166			22,113		9.3	%
Service Charges		1,537			1,366		12.5	%		4,405			3,921		12.3	%
Loan Sale & Servicing Income		145			164		-11.6	%		339			794		-57.3	%
Bank Owned Life Insurance		265			(36	)	n/m			682			50		n/m
Other Non-Interest Income		621			481		29.1	%		1,894			1,362		39.1	%
Gain/(Loss) on Investments		150			1		n/m			115			146		-21.2	%
Total Non-Interest Income		2,718			1,976		37.6	%		7,435			6,273		18.5	%
Salaries & Benefits		3,407			3,062		11.3	%		10,254			8,482		20.9	%
Occupancy Expense		1,375			1,124		22.3	%		3,796			3,135		21.1	%
Other Non-Interest Expenses		2,295			2,743		-16.3	%		6,799			7,604		-10.6	%
Total Non-Interest Expense		7,077			6,929		2.1	%		20,849			19,221		8.5	%
Income Before Taxes		4,127			2,556		61.5	%		10,752			9,165		17.3	%
Provision for Income Taxes		1,086			264		311.4	%		2,774			2,453		13.1	%
Net Income	$	3,041		$	2,292		32.7	%	$	7,978		$	6,712		18.9	%
PER SHARE DATA
Basic Earnings per Share	$	0.33		$	0.25		32.0	%	$	0.86		$	0.73		17.8	%
Diluted Earnings per Share	$	0.30		$	0.24		25.0	%	$	0.80		$	0.69		15.9	%
Common Dividends	$	0.08		$	0.07		14.3	%	$	0.24		$	0.21		14.3	%
Wtd. Avg. Shares Outstanding		9,302,657			9,269,375					9,278,885			9,245,303
Wtd. Avg. Diluted Shares		10,043,714			9,714,622					10,001,101			9,671,461
Common shares outstanding		9,300,927			9,251,844					9,300,927			9,251,844
Book Value	$	6.28		$	5.65		11.2	%	$	6.28		$	5.65		11.2	%
Tangible book value	$	5.69		$	5.06		12.5	%	$	5.69		$	5.06		12.5	%
KEY FINANCIAL RATIOS
Return on Average Equity		20.92	%		17.57	%				19.19	%		18.16	%
Return on Average Assets		1.62	%		1.35	%				1.50	%		1.35	%
Net Interest Margin (Tax-Equiv.)		5.72	%		5.66	%				5.69	%		5.61	%
Efficiency Ratio (Tax-Equiv.)		57.38	%		65.13	%				60.44	%		60.83	%
Net Charge-Offs to Avg Loans		0.10	%		0.27	%				0.31	%		0.56	%
AVERAGE BALANCES
Average Assets	$	745,209		$	673,132		10.7	%	$	711,400		$	666,543		6.7	%
Average Earning Assets	$	657,590		$	606,184		8.5	%	$	627,098		$	603,132		4.0	%
Average Gross Loans & Leases	$	573,687		$	503,888		13.9	%	$	537,091		$	497,479		8.0	%
Average Deposits	$	631,699		$	566,913		11.4	%	$	608,226		$	559,867		8.6	%
Average Equity	$	57,677		$	51,740		11.5	%	$	55,584		$	49,426		12.5	%
TAX DATA
Tax-Exempt Muni Income	$	375		$	457		-17.9	%	$	1,201		$	1,427		-15.8	%
Tax-Exempt BOLI Income	$	265		$	(36	)	638.9	%	$	682		$	50		1264.0	%
Interest Income—Fully Tax Equiv	$	11,108		$	10,870		2.2	%	$	31,996		$	32,259		-0.8	%

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Sierra Bancorp Reports Record 3Q03 Profits

October 21, 2003

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BALANCE SHEET (end of period) (dollars in 000’s, unaudited)	Sept. 30, 2003			Dec. 31, 2002			Sept. 30, 2002			Annual Change
ASSETS
Cash and Due from Banks	$	45,023		$	55,819		$	51,822		-13.1	%
Securities and Fed Funds Sold		81,255			85,758			84,566		-3.9	%
Loans
Agricultural		14,767			11,030			10,597		39.4	%
Commercial & Industrial		93,183			81,243			79,783		16.8	%
Real Estate		406,547			347,377			338,278		20.2	%
SBA Loans		21,415			21,918			22,514		-4.9	%
Consumer Loans		39,963			39,825			40,815		-2.1	%
Credit Card Balances		10,269			11,225			10,889		-5.7	%
Gross Loans & Leases		586,144			512,618			502,876		16.6	%
Deferred Loan Fees		(1,999	)		(1,024	)		(935	)	113.8	%
Loans Net of Deferred Fees		584,145			511,594			501,941		16.4	%
Allowance for Loan Losses		(6,176	)		(5,939	)		(5,316	)	16.2	%
Net Loans		577,969			505,655			496,625		16.4	%
Bank Premises & Equipment		17,847			17,578			16,681		7.0	%
Bank Owned Life Insurance		16,039			15,181			10,604		51.3	%
Other Assets		23,772			21,123			22,110		21.7	%
Total Assets	$	761,905		$	701,114		$	682,408		11.6	%
LIABILITIES & CAPITAL
Demand Deposits	$	185,204		$	166,574		$	145,424		27.4	%
NOW / Savings Deposits		102,572			86,345			87,182		17.7	%
Money Market Deposits		139,727			123,178			111,742		25.0	%
Time Certificates of Deposit		232,905			229,608			225,006		3.5	%
Total Deposits		660,408			605,705			569,354		16.0	%
Trust-Preferred Securities		15,000			15,000			15,000		0.0	%
Other Interest-Bearing Liabilities		19,664			19,323			37,593		-47.7	%
Total Deposits & Int.-Bearing Liab.		695,072			640,028			621,947		11.8	%
Other Liabilities		8,231			7,799			8,022		2.6	%
Total Capital		58,602			53,287			52,439		11.8	%
Total Liabilities & Capital	$	761,905		$	701,114		$	682,408		11.6	%
CREDIT QUALITY DATA:
Non-Accruing Loans	$	7,072		$	4,329		$	4,024		75.7	%
Over 90 Days PD and Still Accruing		7			2,138			1,225		-99.4	%
Other Real Estate Owned		1,319			1,421			1,319		0.0	%
Total Non-Performing Assets		8,398			7,888			6,568		27.9	%
Quarterly net loan charge-offs	$	600		$	278		$	1,384		-56.6	%
Non-Perf Loans to Total Loans		1.21	%		1.26	%		1.04	%
Non-Perf Assets to Total Assets		1.10	%		1.13	%		0.96	%
Allowance for Loan Losses to Loans		1.05	%		1.16	%		1.06	%
OTHER PERIOD END STATISTICS:
Shareholders Equity / Total Assets		7.7	%		7.6	%		7.7	%
Loans/deposits		88.8	%		84.6	%		88.3	%
Non-interest bearing deposits / total deposits		28.0	%		27.5	%		25.5	%

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Note: Transmitted on Business Wire on October 21, 2003 at 11:58 a.m. PDT