September 29, 2005

Mail Stop 4561

By U.S. Mail and facsimile to (805)781-3182

Mr. Jack C. Wauchope
President and Chief Executive Officer
Coast Bancorp
500 Marsh Street
San Luis Obispo, CA 93401

Re:	Coast Bancorp
	Form 10-K for the Fiscal Year Ended December 31, 2004
	File Number: 000-32827

Dear Mr. Wauchope:

      We have reviewed your filing and have limited our review to
those issues we have addressed in the following comments.  Where
indicated, we think you should revise your document in response to
these comments.  If you disagree, we will consider your
explanation
as to why our comments are inapplicable or a revision is
unnecessary.
Please be as detailed as necessary in your explanation.  In our
comments, we may ask you to provide us with supplemental
information
so we may better understand your disclosure.  After reviewing this
information, we may or may not raise additional comments.

	Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects.  We welcome
any questions you may have about our comments or any other aspect
of
our review.  Feel free to call us at the telephone numbers listed
at
the end of this letter.


Form 10-K, filed on March 31, 2005

Financial Statements as of and for the years ended December 31,
2004
and 2003

Segment Reporting
1. You disclose that the bank has been organized as a single
operating segment.  Please tell us why activities such as your
mortgage loan program through the Community Bank Lending Exchange
and
your sales and servicing of loans are not considered to be
individual
operating segments or an aggregated mortgage banking segment,
considering the guidance in paragraphs 10-24 of SFAS 131.  Please
provide an analysis supporting your current accounting, including
relevant qualitative criteria and quantitative threshold tests for
each period presented or revise your financial statements if
necessary.


Note 3 - Loans, page 48
2. We note you have retained servicing assets and interest-only
strips on loans previously sold.  Please provide both in your
response letter and in future filings additional disclosure
regarding
these assets, including, but not limited to the following (refer
to
paragraph 17(e) of FAS 140):
* gross servicing assets and interest-only strips recognized and
amortized during the period;
* significant assumptions used to estimate the fair value of the
assets;
* risk characteristics of the underlying financial assets used to
assess the servicing assets for purposes of measuring impairment;
and
* activity in any valuation allowance(s) for impairment of
servicing
assets and interest-only strips, including beginning and ending
balances and aggregate write-downs charged against the
allowance(s).



* * * * *



      As appropriate, please amend your filing and respond to
these
comments within 10 business days or tell us when you will provide
us
with a response.  You may wish to provide us with marked copies of
the amendment to expedite our review.  Please furnish a cover
letter
with your amendment that keys your responses to our comments and
provides any requested supplemental information.  Detailed cover
letters greatly facilitate our review.  Please understand that we
may
have additional comments after reviewing your amendment and
responses
to our comments.

	We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing reviewed by the staff to
be
certain that they have provided all information investors require
for
an informed decision.  Since the company and its management are in
possession of all facts relating to a company`s disclosure, they
are
responsible for the accuracy and adequacy of the disclosures they
have made.

	In connection with responding to our comments, please
provide,
in writing, a statement from the company acknowledging that:

* the company is responsible for the adequacy and accuracy of the
disclosure in the filing;

* staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filing; and

* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.


      In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in our review of your filing or in
response to our comments on your filing.


      You may contact Amanda Roberts at (202) 551-3417 or me at
(202)
551-3492 if you have questions.


Sincerely,


      John P. Nolan
Accounting Branch Chief


Mr. Jack C. Wauchope
Coast Bancorp
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