UNITED STATES
                       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) January 22, 2003



                              REDWOOD EMPIRE BANCORP
             (Exact name of registrant as specified in its charter)

        California                      0-19231              68-0166366
  (State or other jurisdiction        (Commission           (IRS Employer
        of incorporation)             File Number)       Identification Number)


    111 Santa Rosa Avenue, Santa Rosa, CA                     95404-4905
   (Address of Principal Executive Offices)                    (Zip Code)

   Registrant's Telephone Number, including area code  (707) 573-4800





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




<PAGE>


Item 5.   Other Events

     On January 22, 2003,  the Company issued a press release  reporting  fourth
     quarter  and full year 2002 net  income.  A copy of the  press  release  is
     attached  to this  8-K.





                                   SIGNATURES

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


                             REDWOOD EMPIRE BANCORP
                                  (Registrant)



DATE: January 22, 2003      BY  /s/ James E. Beckwith
                                James E. Beckwith
                                Executive Vice President and
                                Chief Operating Officer




<PAGE>
                                        FOR:  REDWOOD EMPIRE BANCORP

                                APPROVED BY:  James Beckwith
                                              EVP/Chief Operating Officer
                                              707) 522-5215

For Immediate Release

                      REDWOOD EMPIRE BANCORP REPORTS RECORD
                  FOURTH QUARTER AND FULL YEAR 2002 NET INCOME

SANTA ROSA, Calif.  (January 22, 2003) -- Redwood Empire Bancorp (NASDAQ:  REBC)
today reported record net income of $2,031,000 or $.57 per diluted share for the
quarter ended December 31, 2002.  This compares with net income of $1,920,000 or
$.52 per diluted  share for the same  quarter a year ago.  Annualized  return on
common equity was 28.3% in the fourth  quarter of 2002 as compared with 29.0% in
the same quarter a year ago. Annualized return on assets was 1.57% in the fourth
quarter of 2002 as compared to 1.68% one year ago.  For the twelve  months ended
December 31, 2002, net income was  $7,961,000 or $2.21 per diluted  share.  This
compares  with net income of  $7,307,000  or $1.91 per  diluted  share,  for the
twelve months ended December 31, 2001. Return on common equity was 29.0% for the
year ended December 31, 2002 as compared to 26.4% one year ago. Return on assets
amounted to 1.62% for the year ended 2002 year as compared to 1.63% in 2001. "We
are extremely  pleased with bottom line results,"  noted James  Beckwith,  Chief
Operating  Officer.  "Growing  our  franchise,  providing  excellent  service to
customers and delivering  outstanding  returns to our  shareholders  are our key
objectives," said Beckwith.

     Total deposits amounted to $453,093,000 as of December 31, 2002 as compared
to  $397,412,000  at December 31, 2001,  which amounts to a  $55,681,000  or 14%
increase.  Total  assets  amounted to  $513,181,000  as of December  31, 2002 as
compared to $448,742,000 at December 31, 2001, which amounts to a $64,439,000 or
a 14% increase.  Total loans amounted to $365,076,000 as of December 31, 2002 as
compared to $351,649,000 one year ago, or a 4% increase.

     Net interest  income  amounted to $5,283,000 in the fourth quarter of 2002,
compared to $4,986,000 in the same period in 2001,  which  represents a $297,000
increase.  Net  interest  income  for the  year  ended  December  31,  2002  was
$20,866,000  compared to  $20,104,000  in 2001,  an increase  of  $762,000.  The
increase in net interest  income is  attributable  to a substantial  increase in
earning  assets  offset by a decline in net  interest  margin.  Average  earning
assets amounted to $485,829,000 and $464,613,000 for the three and twelve months
ended December 31, 2002 as compared to  $426,524,000  and  $420,340,000  for the
same periods one year ago.  Earning  asset  growth was driven by strong  deposit
growth brought about by the success of the Company's liquid CD product.  The net
interest  margin was 4.31% and 4.49% for the  quarter  and twelve  months  ended
December 31, 2002 as compared to 4.64% and 4.78% one year ago. The Company's net
interest  margin has been  negatively  impacted by sluggish  loan growth and the
decline in the general interest rate environment.

     There was no loan loss  provision for the quarters  ended December 31, 2002
and  December  31, 2001.  There was no loan loss  provision  for the years ended
December 31, 2002 and 2001. Net charge-offs were $178,000 or .2% (annualized) of
average  portfolio  loans  for  the  quarter  as  compared  to  $29,000  or .03%
(annualized)  one year ago.  Net  charge-offs  were  $180,000 or .05% of average
portfolio  loans for the year ended  December 31, 2002 as compared to $94,000 or
..03% in 2001.  Non-performing assets at December 31, 2002 were $2,794,000 or .5%
of total assets, as compared to non-performing  assets of $3,176,000,  or .7% of
total  assets,  as of  December  31,  2001.  The  allowance  for loan  losses to
nonperforming  assets was 265% as of December 31, 2002 as compared to 239% as of
December 31, 2001.


<PAGE>


     Non-interest  income  amounted to $1,849,000 for the quarter ended December
31, 2002 as compared to  $1,988,000 in the same period in 2001 or a 7% decrease.
Non-interest  income amounted to $7,615,000 for the twelve months ended December
31, 2002 as compared to  $6,599,000  one year ago, an increase of  $1,016,000 or
15%. Merchant draft processing  revenues increased $1,000 from $1,310,000 in the
fourth quarter of 2001 to $1,311,000 in the fourth quarter of 2002. For the year
ended December 31, 2002 merchant draft processing  revenues  increased  $769,000
from  $4,240,000 for the year ended December 31, 2001 to $5,009,000 for the year
ended December 31, 2002. The increase in merchant card revenue for the year is a
result of the Company  achieving  success in building its overall merchant draft
processing  business  through  direct  marketing  efforts and new ISO  business.
Excluding net revenue from merchant  bankcard  processing,  non-interest  income
amounted  to  $538,000  and  $2,606,000  for the three and twelve  months  ended
December  31, 2002 as compared to $678,000 and  $2,359,000  for the same periods
one year ago.

     Non-interest  expense amounted to $4,060,000 for the quarter ended December
31,  2002 as  compared  to  $3,740,000  in the same  period one year ago,  which
represents an increase of $320,000 or 9%. The increase in  non-interest  expense
is  primarily  attributable  an  increase  in salary and  benefit  expense.  The
Company's  efficiency  ratio for the fourth  quarter of 2002  amounted to 57% as
compared to 54% one year ago.  Non-interest  expense amounted to $16,005,000 for
the twelve months ended December 31, 2002 as compared to $14,451,000 in the same
period one year ago.  This  represents  an increase of  $1,554,000  or 11%.  The
Company's  efficiency  ratio was 56% for 2002 as compared  to 54% for 2001.  The
efficiency ratio for the Company's subsidiary, National Bank of the Redwoods was
53% for the quarter ended December 31, 2002 as compared to 49% one year ago. For
the  twelve  months  ended  December  31,  2002 and 2001,  National  Bank of the
Redwood's efficiency ratio was 51% and 50%.

     For the three and twelve months ended  December 31, 2002, the net income of
the  Company's  community  banking  segment was  $1,503,000  and  $6,080,000  on
revenues  of  $5,680,000  and  $22,876,000.  This  compares  to  net  income  of
$1,360,000 and $5,485,000  and revenues of $5,454,000  and  $21,421,000  for the
same  periods one year ago.  The  segment's  11%  quarterly  improvement  in net
income, as compared to the fourth quarter of 2001, is primarily  attributable to
an  increase  net  interest  income.  The net income of the  Company's  bankcard
segment was  $528,000  and  $1,881,000  for the quarter and twelve  months ended
December 31, 2002 versus  $560,000 and  $1,822,000 in 2001.  The increase in the
segment's net income for the year ended  December 31, 2002 is due to an increase
in  processing  revenue,  which  more than  offsets  an  increase  in salary and
benefits expenses. The increase in the unit's salary and benefits expense is due
to a build-up in sales development  personnel.  The merchant bankcard  segment's
net income  comprised 26% and 24% of the Company's  consolidated  net income for
the three and twelve months ended December 31, 2002,  compared to 29% and 25% of
the  Company's  consolidated  net income for the three and twelve  months  ended
December 31, 2001.



<PAGE>


     As previously disclosed in the Company's quarterly reports on Form 10-Q for
the quarters  ended March 31, 2002,  June 30, 2002,  and  September 30, 2002, on
January 15, 2002 National Bank of the Redwoods formed NBR Real Estate Investment
Trust, a Maryland Real Estate  Investment  Trust.  The entity was formed to hold
the Bank's real estate secured loans and to better organize the Bank's marketing
and  origination of real estate secured loans.  As a result of the formation and
funding of this entity,  along with the  one-time  benefit  associated  with the
current year  recapture of only 50% of the Company's  California  state bad debt
reserve,  and the allowed permanent  deduction of the other 50% of the Company's
California state bad debt reserve,  the Company's effective tax rate was reduced
to 33.9% for the quarter  ended  December  31, 2002 as compared to 40.6% for the
quarter  ended  December 31,  2001.  For the year ended  December 31, 2002,  the
Company's  effective  tax rate was 36.2% as  compared  to 40.4% for 2001.  Costs
associated  with the  implementation  of the NBR Real  Estate  Investment  Trust
amounted to $60,000  for the fourth  quarter of 2002 and  $163,000  for the full
2002 year.

     In August  2001,  the Company  announced  an  authorization  to  repurchase
355,500  shares,  as  adjusted  for  the  three-for-two  stock  split  announced
September  20, 2001. To date,  190,636  shares have been  repurchased  under the
current  authorization.  Under the  repurchase  program,  the  Company  plans to
purchase  shares  from  time to time on the  open  market  and/or  in  privately
negotiated transactions.

     Total  assets were  $513,181,000  at year-end  2002.  Common book value per
share was $8.46.  The Company's Tier 1 capital to average assets ratio was 7.01%
as of December 31, 2002.

     Redwood  Empire  Bancorp,   through  its  principal  operating  subsidiary,
National Bank of the Redwoods, provides diverse financial products and services.
The Company  offers  commercial  banking  services  primarily to businesses  and
professionals in the North Coast counties of California.  The Company's business
strategy includes the development of fee-based  products and services which will
provide insulation to the Company's results from changes in interest rates.

     Except  for  historical   information   contained  herein,  the  statements
contained  in  this  press  release,   including  statements  concerning  future
increases in the value of Redwood  Empire  Bancorp  stock,  are  forward-looking
statements within the meaning of the "safe harbor"  provisions of Section 27A of
the  Securities  Act of 1933,  as amended,  and  section  21E of the  Securities
Exchange Act or 1934, as amended.  These forward-looking  statements are subject
to risks and uncertainties.  Actual results may differ materially from those set
forth in or implied by  forward-looking  statements.  These risks are  described
from time to time in Redwood Empire Bancorp's Securities and Exchange Commission
filings, including its Annual Reports on Form 10-K and quarterly reports on Form
10-Q.  Redwood Empire Bancorp disclaims any intent or obligation to update these
forward-looking statements.



                               (Tables to follow)


<PAGE>


<TABLE>
<CAPTION>
                                         REDWOOD EMPIRE BANCORP AND SUBSIDIARIES
                                     CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                                       (Unaudited)
                           (Dollars in thousands except for earnings per share and share data)

                                                                    Three Months Ended            Twelve Months Ended
                                                                       December 31,                  December 31,
                                                                   2002           2001            2002           2001
                                                              -------------------------------------------------------------
<S>                                                                <C>             <C>             <C>           <C>
Total interest income                                                 $7,587          $7,743         $30,536       $33,555
Total interest expense                                                 2,304           2,757           9,670        13,451
                                                              -------------------------------------------------------------
Net interest income                                                    5,283           4,986          20,866        20,104
Provision for loan losses                                                  -               -               -             -
                                                              -------------------------------------------------------------
Net interest income after provision for loan losses                    5,283           4,986          20,866        20,104
                                                              -------------------------------------------------------------
Service charges on deposit accounts                                      278             297           1,188         1,116
Merchant draft processing, net                                         1,311           1,310           5,009         4,240
Loan servicing income                                                     67              69             268           295
Net realized gains on investment securities available for sale             -              90             294           112
Other income                                                             193             222             856           836
                                                              -------------------------------------------------------------
   Total noninterest income                                            1,849           1,988           7,615         6,599
                                                              -------------------------------------------------------------
Salaries and employee benefits                                         2,273           2,049           8,967         8,336
Occupancy and equipment expense                                          538             523           2,126         2,026
Other                                                                  1,249           1,168           4,912         4,089
                                                              -------------------------------------------------------------
   Total noninterest expense                                           4,060           3,740          16,005        14,451
                                                              -------------------------------------------------------------
Income before income tax expense                                       3,072           3,234          12,476        12,252
Income tax expense                                                     1,041           1,314           4,515         4,945
                                                              -------------------------------------------------------------
Net income                                                            $2,031          $1,920          $7,961        $7,307
                                                              =============================================================

Basic earnings per share:
  Net income available for common stock shareholders                   $0.59           $0.54           $2.29         $1.97
  Weighted average shares (1)                                      3,430,000       3,548,000       3,474,000     3,703,000

Diluted earnings per share:
  Net income available for common stock shareholders                   $0.57           $0.52           $2.21         $1.91
  Weighted average shares (1)                                      3,551,000       3,671,000       3,600,000     3,825,000

Selected Ratios
Annualized Return on Average Total Equity                            28.26 %          29.02%         28.98 %        26.41%
Annualized Return on Average Total Assets                             1.57 %           1.68%          1.62 %         1.63%

(1) Adjusted for three-for-two stock split announced September 20, 2001.
</TABLE>


<TABLE>
<CAPTION>
                                                               Selected Balance Sheet Data
                                                                      (In Thousands)
                                                                       (Unaudited)

                                                               December 31,   December 31,
                                                                   2002           2001
                                                              -------------------------------
<S>                                                                 <C>             <C>
Total Loans                                                         $365,076        $351,649
Allowance for Loan Losses                                              7,400           7,580
Total Assets                                                         513,181         448,742
Total Deposits                                                       453,093         397,412
Trust Preferred Debt                                                  10,000          10,000
Total Shareholders' Equity                                            28,807          26,687
Nonperforming Assets                                                   2,794           3,176
</TABLE>



<PAGE>


<TABLE>
<CAPTION>
                                         REDWOOD EMPIRE BANCORP AND SUBSIDIARIES
                                                    BUSINESS SEGMENTS
                                                       (Unaudited)
                                                  (Dollars in thousands)

                                                                         Three Months Ended        Twelve Months Ended
                                                                         December 31, 2002          December 31, 2002
                                                                     ------------------------------------------------------

                                                                       Community                  Community
                                                                        Banking      Bankcard      Banking      Bankcard
                                                                     ------------------------------------------------------
<S>                                                                          <C>          <C>          <C>          <C>
Total interest income                                                        $7,587       $ ---        $30,536       $ ---
Total interest expense                                                        2,299           5          9,641          29
Interest income (expense) allocation                                          (146)         146          (625)         625
                                                                     ------------------------------------------------------
Net interest income                                                           5,142         141         20,270         596
                                                                     ------------------------------------------------------
Provision for loan losses                                                       ---         ---            ---         ---
Service charges on deposit accounts                                             278         ---          1,188         ---
Merchant draft processing, net                                                  ---       1,311            ---       5,009
Loan servicing income                                                            67         ---            268         ---
Net realized gains on investment securities available for sale                  ---         ---            294         ---
Other income                                                                    193         ---            856         ---
                                                                     ------------------------------------------------------
   Total noninterest income                                                     538       1,311          2,606       5,009
                                                                     ------------------------------------------------------
Salaries and employee benefits                                                1,834         439          7,231       1,736
Occupancy and equipment expense                                                 492          46          1,943         183
Other                                                                         1,065         184          4,153         759
                                                                     ------------------------------------------------------
   Total noninterest expense                                                  3,391         669         13,327       2,678
                                                                     ------------------------------------------------------
Income before income tax expense                                              2,289         783          9,549       2,927
Income tax expense                                                              786         255          3,469       1,046
                                                                     ------------------------------------------------------
Net income                                                                   $1,503        $528         $6,080      $1,881
                                                                     ======================================================
</TABLE>


<TABLE>
<CAPTION>
                                                                         Three Months Ended        Twelve Months Ended
                                                                         December 31, 2001          December 31, 2001
                                                                     ------------------------------------------------------

                                                                       Community                  Community
                                                                        Banking      Bankcard      Banking      Bankcard
                                                                     ------------------------------------------------------
<S>                                                                          <C>          <C>          <C>           <C>
Total interest income                                                        $7,743       $ ---        $33,555       $ ---
Total interest expense                                                        2,755           2         13,441          10
Interest income (expense) allocation                                          (212)         212        (1,052)       1,052
                                                                     ------------------------------------------------------
Net interest income                                                           4,776         210         19,062       1,042
                                                                     ------------------------------------------------------
Provision for loan losses                                                       ---         ---            ---         ---
Service charges on deposit accounts                                             297         ---          1,116         ---
Merchant draft processing, net                                                  ---       1,310            ---       4,240
Loan servicing income                                                            69         ---            295         ---
Net realized gains on investment securities available for sale                   90         ---            112         ---
Other income                                                                    222         ---            836         ---
                                                                     ------------------------------------------------------
   Total noninterest income                                                     678       1,310          2,359       4,240
                                                                     ------------------------------------------------------
Salaries and employee benefits                                                1,665         384          6,838       1,498
Occupancy and equipment expense                                                 482          41          1,868         158
Other                                                                         1,014         154          3,516         573
                                                                     ------------------------------------------------------
   Total noninterest expense                                                  3,161         579         12,222       2,229
                                                                     ------------------------------------------------------
Income before income tax expense                                              2,293         941          9,199       3,053
Income tax expense                                                              933         381          3,714       1,231
                                                                     ------------------------------------------------------
Net income                                                                   $1,360        $560         $5,485      $1,822
                                                                     ======================================================

</TABLE>
[{"type": "8-K", "sequence": "1", "filename": "sec8k012203.txt", "description": "PRESS RELEASE 4Q 2002", "secsgml_size_bytes": 27610}]
{"company-data": {"conformed-name": "REDWOOD EMPIRE BANCORP", "cik": "0000840007", "assigned-sic": "6021", "irs-number": "680166366", "state-of-incorporation": "CA", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-10868", "film-number": "03522135"}, "business-address": {"street1": "111 SANTA ROSA AVENUE", "street2": "PO BOX 402", "city": "SANTA ROSA", "state": "CA", "zip": "95404-4905", "phone": "7075734800"}, "mail-address": {"street1": "111 SANTA ROSA AVENUE", "city": "SANTA ROSA", "state": "CA", "zip": "95404-4905"}}
UNITED STATES
                       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) January 22, 2003

                              REDWOOD EMPIRE BANCORP
             (Exact name of registrant as specified in its charter)

        California                      0-19231              68-0166366
  (State or other jurisdiction        (Commission           (IRS Employer
        of incorporation)             File Number)       Identification Number)

    111 Santa Rosa Avenue, Santa Rosa, CA                     95404-4905
   (Address of Principal Executive Offices)                    (Zip Code)

   Registrant's Telephone Number, including area code  (707) 573-4800

          (Former name or former address, if changed since last report)
Item 5.   Other Events

     On January 22, 2003,  the Company issued a press release  reporting  fourth
     quarter  and full year 2002 net  income.  A copy of the  press  release  is
     attached  to this  8-K.

                                   SIGNATURES

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

                             REDWOOD EMPIRE BANCORP
                                  (Registrant)

DATE: January 22, 2003      BY  /s/ James E. Beckwith
                                James E. Beckwith
                                Executive Vice President and
                                Chief Operating Officer
FOR:  REDWOOD EMPIRE BANCORP

                                APPROVED BY:  James Beckwith
                                              EVP/Chief Operating Officer
                                              707) 522-5215

For Immediate Release

                      REDWOOD EMPIRE BANCORP REPORTS RECORD
                  FOURTH QUARTER AND FULL YEAR 2002 NET INCOME

SANTA ROSA, Calif.  (January 22, 2003) -- Redwood Empire Bancorp (NASDAQ:  REBC)
today reported record net income of $2,031,000 or $.57 per diluted share for the
quarter ended December 31, 2002.  This compares with net income of $1,920,000 or
$.52 per diluted  share for the same  quarter a year ago.  Annualized  return on
common equity was 28.3% in the fourth  quarter of 2002 as compared with 29.0% in
the same quarter a year ago. Annualized return on assets was 1.57% in the fourth
quarter of 2002 as compared to 1.68% one year ago.  For the twelve  months ended
December 31, 2002, net income was  $7,961,000 or $2.21 per diluted  share.  This
compares  with net income of  $7,307,000  or $1.91 per  diluted  share,  for the
twelve months ended December 31, 2001. Return on common equity was 29.0% for the
year ended December 31, 2002 as compared to 26.4% one year ago. Return on assets
amounted to 1.62% for the year ended 2002 year as compared to 1.63% in 2001. "We
are extremely  pleased with bottom line results,"  noted James  Beckwith,  Chief
Operating  Officer.  "Growing  our  franchise,  providing  excellent  service to
customers and delivering  outstanding  returns to our  shareholders  are our key
objectives," said Beckwith.

     Total deposits amounted to $453,093,000 as of December 31, 2002 as compared
to  $397,412,000  at December 31, 2001,  which amounts to a  $55,681,000  or 14%
increase.  Total  assets  amounted to  $513,181,000  as of December  31, 2002 as
compared to $448,742,000 at December 31, 2001, which amounts to a $64,439,000 or
a 14% increase.  Total loans amounted to $365,076,000 as of December 31, 2002 as
compared to $351,649,000 one year ago, or a 4% increase.

     Net interest  income  amounted to $5,283,000 in the fourth quarter of 2002,
compared to $4,986,000 in the same period in 2001,  which  represents a $297,000
increase.  Net  interest  income  for the  year  ended  December  31,  2002  was
$20,866,000  compared to  $20,104,000  in 2001,  an increase  of  $762,000.  The
increase in net interest  income is  attributable  to a substantial  increase in
earning  assets  offset by a decline in net  interest  margin.  Average  earning
assets amounted to $485,829,000 and $464,613,000 for the three and twelve months
ended December 31, 2002 as compared to  $426,524,000  and  $420,340,000  for the
same periods one year ago.  Earning  asset  growth was driven by strong  deposit
growth brought about by the success of the Company's liquid CD product.  The net
interest  margin was 4.31% and 4.49% for the  quarter  and twelve  months  ended
December 31, 2002 as compared to 4.64% and 4.78% one year ago. The Company's net
interest  margin has been  negatively  impacted by sluggish  loan growth and the
decline in the general interest rate environment.

     There was no loan loss  provision for the quarters  ended December 31, 2002
and  December  31, 2001.  There was no loan loss  provision  for the years ended
December 31, 2002 and 2001. Net charge-offs were $178,000 or .2% (annualized) of
average  portfolio  loans  for  the  quarter  as  compared  to  $29,000  or .03%
(annualized)  one year ago.  Net  charge-offs  were  $180,000 or .05% of average
portfolio  loans for the year ended  December 31, 2002 as compared to $94,000 or
..03% in 2001.  Non-performing assets at December 31, 2002 were $2,794,000 or .5%
of total assets, as compared to non-performing  assets of $3,176,000,  or .7% of
total  assets,  as of  December  31,  2001.  The  allowance  for loan  losses to
nonperforming  assets was 265% as of December 31, 2002 as compared to 239% as of
December 31, 2001.
Non-interest  income  amounted to $1,849,000 for the quarter ended December
31, 2002 as compared to  $1,988,000 in the same period in 2001 or a 7% decrease.
Non-interest  income amounted to $7,615,000 for the twelve months ended December
31, 2002 as compared to  $6,599,000  one year ago, an increase of  $1,016,000 or
15%. Merchant draft processing  revenues increased $1,000 from $1,310,000 in the
fourth quarter of 2001 to $1,311,000 in the fourth quarter of 2002. For the year
ended December 31, 2002 merchant draft processing  revenues  increased  $769,000
from  $4,240,000 for the year ended December 31, 2001 to $5,009,000 for the year
ended December 31, 2002. The increase in merchant card revenue for the year is a
result of the Company  achieving  success in building its overall merchant draft
processing  business  through  direct  marketing  efforts and new ISO  business.
Excluding net revenue from merchant  bankcard  processing,  non-interest  income
amounted  to  $538,000  and  $2,606,000  for the three and twelve  months  ended
December  31, 2002 as compared to $678,000 and  $2,359,000  for the same periods
one year ago.

     Non-interest  expense amounted to $4,060,000 for the quarter ended December
31,  2002 as  compared  to  $3,740,000  in the same  period one year ago,  which
represents an increase of $320,000 or 9%. The increase in  non-interest  expense
is  primarily  attributable  an  increase  in salary and  benefit  expense.  The
Company's  efficiency  ratio for the fourth  quarter of 2002  amounted to 57% as
compared to 54% one year ago.  Non-interest  expense amounted to $16,005,000 for
the twelve months ended December 31, 2002 as compared to $14,451,000 in the same
period one year ago.  This  represents  an increase of  $1,554,000  or 11%.  The
Company's  efficiency  ratio was 56% for 2002 as compared  to 54% for 2001.  The
efficiency ratio for the Company's subsidiary, National Bank of the Redwoods was
53% for the quarter ended December 31, 2002 as compared to 49% one year ago. For
the  twelve  months  ended  December  31,  2002 and 2001,  National  Bank of the
Redwood's efficiency ratio was 51% and 50%.

     For the three and twelve months ended  December 31, 2002, the net income of
the  Company's  community  banking  segment was  $1,503,000  and  $6,080,000  on
revenues  of  $5,680,000  and  $22,876,000.  This  compares  to  net  income  of
$1,360,000 and $5,485,000  and revenues of $5,454,000  and  $21,421,000  for the
same  periods one year ago.  The  segment's  11%  quarterly  improvement  in net
income, as compared to the fourth quarter of 2001, is primarily  attributable to
an  increase  net  interest  income.  The net income of the  Company's  bankcard
segment was  $528,000  and  $1,881,000  for the quarter and twelve  months ended
December 31, 2002 versus  $560,000 and  $1,822,000 in 2001.  The increase in the
segment's net income for the year ended  December 31, 2002 is due to an increase
in  processing  revenue,  which  more than  offsets  an  increase  in salary and
benefits expenses. The increase in the unit's salary and benefits expense is due
to a build-up in sales development  personnel.  The merchant bankcard  segment's
net income  comprised 26% and 24% of the Company's  consolidated  net income for
the three and twelve months ended December 31, 2002,  compared to 29% and 25% of
the  Company's  consolidated  net income for the three and twelve  months  ended
December 31, 2001.
As previously disclosed in the Company's quarterly reports on Form 10-Q for
the quarters  ended March 31, 2002,  June 30, 2002,  and  September 30, 2002, on
January 15, 2002 National Bank of the Redwoods formed NBR Real Estate Investment
Trust, a Maryland Real Estate  Investment  Trust.  The entity was formed to hold
the Bank's real estate secured loans and to better organize the Bank's marketing
and  origination of real estate secured loans.  As a result of the formation and
funding of this entity,  along with the  one-time  benefit  associated  with the
current year  recapture of only 50% of the Company's  California  state bad debt
reserve,  and the allowed permanent  deduction of the other 50% of the Company's
California state bad debt reserve,  the Company's effective tax rate was reduced
to 33.9% for the quarter  ended  December  31, 2002 as compared to 40.6% for the
quarter  ended  December 31,  2001.  For the year ended  December 31, 2002,  the
Company's  effective  tax rate was 36.2% as  compared  to 40.4% for 2001.  Costs
associated  with the  implementation  of the NBR Real  Estate  Investment  Trust
amounted to $60,000  for the fourth  quarter of 2002 and  $163,000  for the full
2002 year.

     In August  2001,  the Company  announced  an  authorization  to  repurchase
355,500  shares,  as  adjusted  for  the  three-for-two  stock  split  announced
September  20, 2001. To date,  190,636  shares have been  repurchased  under the
current  authorization.  Under the  repurchase  program,  the  Company  plans to
purchase  shares  from  time to time on the  open  market  and/or  in  privately
negotiated transactions.

     Total  assets were  $513,181,000  at year-end  2002.  Common book value per
share was $8.46.  The Company's Tier 1 capital to average assets ratio was 7.01%
as of December 31, 2002.

     Redwood  Empire  Bancorp,   through  its  principal  operating  subsidiary,
National Bank of the Redwoods, provides diverse financial products and services.
The Company  offers  commercial  banking  services  primarily to businesses  and
professionals in the North Coast counties of California.  The Company's business
strategy includes the development of fee-based  products and services which will
provide insulation to the Company's results from changes in interest rates.

     Except  for  historical   information   contained  herein,  the  statements
contained  in  this  press  release,   including  statements  concerning  future
increases in the value of Redwood  Empire  Bancorp  stock,  are  forward-looking
statements within the meaning of the "safe harbor"  provisions of Section 27A of
the  Securities  Act of 1933,  as amended,  and  section  21E of the  Securities
Exchange Act or 1934, as amended.  These forward-looking  statements are subject
to risks and uncertainties.  Actual results may differ materially from those set
forth in or implied by  forward-looking  statements.  These risks are  described
from time to time in Redwood Empire Bancorp's Securities and Exchange Commission
filings, including its Annual Reports on Form 10-K and quarterly reports on Form
10-Q.  Redwood Empire Bancorp disclaims any intent or obligation to update these
forward-looking statements.

                               (Tables to follow)
REDWOOD EMPIRE BANCORP AND SUBSIDIARIES
                                     CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                                       (Unaudited)
                           (Dollars in thousands except for earnings per share and share data)

                                                                    Three Months Ended            Twelve Months Ended
                                                                       December 31,                  December 31,
                                                                   2002           2001            2002           2001
                                                              -------------------------------------------------------------
Total interest income                                                 $7,587          $7,743         $30,536       $33,555
Total interest expense                                                 2,304           2,757           9,670        13,451
                                                              -------------------------------------------------------------
Net interest income                                                    5,283           4,986          20,866        20,104
Provision for loan losses                                                  -               -               -             -
                                                              -------------------------------------------------------------
Net interest income after provision for loan losses                    5,283           4,986          20,866        20,104
                                                              -------------------------------------------------------------
Service charges on deposit accounts                                      278             297           1,188         1,116
Merchant draft processing, net                                         1,311           1,310           5,009         4,240
Loan servicing income                                                     67              69             268           295
Net realized gains on investment securities available for sale             -              90             294           112
Other income                                                             193             222             856           836
                                                              -------------------------------------------------------------
   Total noninterest income                                            1,849           1,988           7,615         6,599
                                                              -------------------------------------------------------------
Salaries and employee benefits                                         2,273           2,049           8,967         8,336
Occupancy and equipment expense                                          538             523           2,126         2,026
Other                                                                  1,249           1,168           4,912         4,089
                                                              -------------------------------------------------------------
   Total noninterest expense                                           4,060           3,740          16,005        14,451
                                                              -------------------------------------------------------------
Income before income tax expense                                       3,072           3,234          12,476        12,252
Income tax expense                                                     1,041           1,314           4,515         4,945
                                                              -------------------------------------------------------------
Net income                                                            $2,031          $1,920          $7,961        $7,307
                                                              =============================================================

Basic earnings per share:
  Net income available for common stock shareholders                   $0.59           $0.54           $2.29         $1.97
  Weighted average shares (1)                                      3,430,000       3,548,000       3,474,000     3,703,000

Diluted earnings per share:
  Net income available for common stock shareholders                   $0.57           $0.52           $2.21         $1.91
  Weighted average shares (1)                                      3,551,000       3,671,000       3,600,000     3,825,000

Selected Ratios
Annualized Return on Average Total Equity                            28.26 %          29.02%         28.98 %        26.41%
Annualized Return on Average Total Assets                             1.57 %           1.68%          1.62 %         1.63%

(1) Adjusted for three-for-two stock split announced September 20, 2001.
Selected Balance Sheet Data
                                                                      (In Thousands)
                                                                       (Unaudited)

                                                               December 31,   December 31,
                                                                   2002           2001
                                                              -------------------------------
Total Loans                                                         $365,076        $351,649
Allowance for Loan Losses                                              7,400           7,580
Total Assets                                                         513,181         448,742
Total Deposits                                                       453,093         397,412
Trust Preferred Debt                                                  10,000          10,000
Total Shareholders' Equity                                            28,807          26,687
Nonperforming Assets                                                   2,794           3,176
REDWOOD EMPIRE BANCORP AND SUBSIDIARIES
                                                    BUSINESS SEGMENTS
                                                       (Unaudited)
                                                  (Dollars in thousands)

                                                                         Three Months Ended        Twelve Months Ended
                                                                         December 31, 2002          December 31, 2002
                                                                     ------------------------------------------------------

                                                                       Community                  Community
                                                                        Banking      Bankcard      Banking      Bankcard
                                                                     ------------------------------------------------------
Total interest income                                                        $7,587       $ ---        $30,536       $ ---
Total interest expense                                                        2,299           5          9,641          29
Interest income (expense) allocation                                          (146)         146          (625)         625
                                                                     ------------------------------------------------------
Net interest income                                                           5,142         141         20,270         596
                                                                     ------------------------------------------------------
Provision for loan losses                                                       ---         ---            ---         ---
Service charges on deposit accounts                                             278         ---          1,188         ---
Merchant draft processing, net                                                  ---       1,311            ---       5,009
Loan servicing income                                                            67         ---            268         ---
Net realized gains on investment securities available for sale                  ---         ---            294         ---
Other income                                                                    193         ---            856         ---
                                                                     ------------------------------------------------------
   Total noninterest income                                                     538       1,311          2,606       5,009
                                                                     ------------------------------------------------------
Salaries and employee benefits                                                1,834         439          7,231       1,736
Occupancy and equipment expense                                                 492          46          1,943         183
Other                                                                         1,065         184          4,153         759
                                                                     ------------------------------------------------------
   Total noninterest expense                                                  3,391         669         13,327       2,678
                                                                     ------------------------------------------------------
Income before income tax expense                                              2,289         783          9,549       2,927
Income tax expense                                                              786         255          3,469       1,046
                                                                     ------------------------------------------------------
Net income                                                                   $1,503        $528         $6,080      $1,881
                                                                     ======================================================
Three Months Ended        Twelve Months Ended
                                                                         December 31, 2001          December 31, 2001
                                                                     ------------------------------------------------------

                                                                       Community                  Community
                                                                        Banking      Bankcard      Banking      Bankcard
                                                                     ------------------------------------------------------
Total interest income                                                        $7,743       $ ---        $33,555       $ ---
Total interest expense                                                        2,755           2         13,441          10
Interest income (expense) allocation                                          (212)         212        (1,052)       1,052
                                                                     ------------------------------------------------------
Net interest income                                                           4,776         210         19,062       1,042
                                                                     ------------------------------------------------------
Provision for loan losses                                                       ---         ---            ---         ---
Service charges on deposit accounts                                             297         ---          1,116         ---
Merchant draft processing, net                                                  ---       1,310            ---       4,240
Loan servicing income                                                            69         ---            295         ---
Net realized gains on investment securities available for sale                   90         ---            112         ---
Other income                                                                    222         ---            836         ---
                                                                     ------------------------------------------------------
   Total noninterest income                                                     678       1,310          2,359       4,240
                                                                     ------------------------------------------------------
Salaries and employee benefits                                                1,665         384          6,838       1,498
Occupancy and equipment expense                                                 482          41          1,868         158
Other                                                                         1,014         154          3,516         573
                                                                     ------------------------------------------------------
   Total noninterest expense                                                  3,161         579         12,222       2,229
                                                                     ------------------------------------------------------
Income before income tax expense                                              2,293         941          9,199       3,053
Income tax expense                                                              933         381          3,714       1,231
                                                                     ------------------------------------------------------
Net income                                                                   $1,360        $560         $5,485      $1,822
                                                                     ======================================================