BANK OF SAN FRANCISCO CO HOLDING CO, PRER14A, 1994-03-30

BANK OF SAN FRANCISCO CO HOLDING CO
PRER14A, 1994-03-30
STATE COMMERCIAL BANKS

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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
(Amendment No. 2)

Filed by the Registrant /x/

Filed by a Party other than the Registrant / /

Check the appropriate box:

/x/ Preliminary Proxy Statement
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12

Bank of San Francisco Company Holding Company
...............................................................................
(Name of Registrant as Specified In Its Charter)

Bank of San Francisco Company Holding Company
...............................................................................
(Name of Person(s) Filing Proxy Statement)

Payment of Filing Fee (Check the appropriate box): Not Applicable.

/ / $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or
14a-6(j)(2).
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i) and 0-11.

1) Title of each class of securities to which transaction applies:

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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:(1)

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4) Proposed maximum aggregate value of transaction:

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(1) Set forth the amount on which the filing fee is calculated and state how it
was determined.

/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.

1) Amount Previously Paid:

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2) Form, Schedule or Registration Statement No.:

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3) Filing Party:

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4) Date Filed:

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B&MCK DRAFT
MARCH 27, 1994

BANK OF SAN FRANCISCO COMPANY
HOLDING COMPANY
550 MONTGOMERY STREET, 10TH FLOOR
SAN FRANCISCO, CALIFORNIA 94111

APRIL 4, 1994

Dear Stockholder:

You are cordially invited to attend the 1994 Annual Meeting of
Stockholders of Bank of San Francisco Company Holding Company (the "Company"),
to be held on April 20, 1994, at 2:00 p.m., in the Boardroom of the Company at
550 Montgomery Street, 11th Floor, San Francisco, California. Enclosed are the
Notice of the Annual Meeting, a Proxy Statement describing the business to be
transacted at the meeting, and proxy cards for use in voting at the meeting.
Separate proxy cards are provided for the holders of the Company's Class A
Common Stock, $0.01 par value (the "Class A Common Stock"), of the Company's 8%
Series B Convertible Preferred Stock, $0.01 par value (the "Series B Preferred
Stock"), and of the Company's 9% Series C Perpetual Preferred Stock, $0.01 par
value (the "Series C Preferred Stock").

At the Annual Meeting, stockholders will be asked:

(i) to elect five of the nine authorized directors of the Company,
three (3) to serve for two-year terms and two (2) to serve for three-year
terms;

(ii) to authorize the conversion of each share of the Series C
Preferred Stock into 40 shares of the Class A Common Stock and 40 warrants
(the "Warrants"), with each Warrant granting the right to purchase an
additional share of Class A Common Stock, exercisable at $0.50 per share (the
"Conversion"), and in connection with the Conversion to amend the Company's
Certificate of Incorporation (the "Certificate"), including the Certificate of
Designations of Rights, Preferences, Privileges and Restrictions relating to
the Series C Preferred Stock (the "Certificate of Designation"), (a) to
increase the authorized number of shares of Class A Common Stock to
400,000,000 (subject to the subsequent decrease of the number of authorized
shares to 40,000,000 through a 1-for-10 reverse stock split if the stockholders
approve Item (iv) below) so as to permit the Conversion and increase the
ability of the Company to raise capital in the future through the issuance of
Class A Common Stock or securities convertible into Class A Common Stock, and
(b) to amend the Certificate of Designation to provide that all outstanding
shares of Series C Preferred Stock will automatically be converted into Class A
Common Stock and Warrants, in accordance with the conversion rights set forth
in the Certificate of Designation, on April 29, 1994. SUBJECT TO THE DILUTION
WHICH IS EXPECTED AS A RESULT OF THE PROPOSED PRIVATE PLACEMENT BY THE COMPANY
WHICH IS DESCRIBED IN ITEM (V) BELOW, THE CONVERSION OF THE OUTSTANDING SHARES
OF SERIES C PREFERRED STOCK WOULD RESULT IN A SUBSTANTIAL INCREASE IN THE
VOTING POWER AND CONTROL OVER THE COMPANY HELD BY THE COMPANY'S MAJORITY
STOCKHOLDER, INCREASING HIS OWNERSHIP FROM THE CURRENT 66.2% OF THE VOTING
POWER OF THE COMPANY TO AT LEAST 92.6%, ASSUMING HE DOES NOT DISPOSE OF ANY OF
HIS SHARES, AND AS MUCH AS 95.9% IF HE WERE TO EXERCISE ALL OF THE WARRANTS HE
WOULD HOLD UPON COMPLETION OF THE CONVERSION;

(iii) to increase the authorized number of shares of the Company's Preferred
Stock to 5,000,000 in order to increase the ability of the Company to raise
capital in the future through the issuance of Preferred Stock;

(iv) to authorize the amendment and restatement of the Company's
Certificate to (a) reclassify the Company's Class B Common Stock as and
into Class A Common Stock, (b) effect a 1-for-10 reverse stock split of the
Class A Common Stock and thereby to decrease the authorized number of shares of
the Company's Class A Common Stock to 40,000,000, (c) change the name of the
Company to The San Francisco Company, and (d) update certain provisions of the
Certificate;

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(v) to authorize the issuance of additional shares of Class A Common
Stock in excess of twenty percent (20%) of the number of shares of Class A
Common Stock outstanding following the Conversion, with the number of shares,
price and other terms and conditions of such offering determined by the Board
of Directors of the Company after negotiation with potential investors. The
shares of Class A Common Stock to be issued may be issued at less than current
book and market value per share. The Company is currently proposing a private
placement (the "Private Placement") of up to 7,222,222 units (the "Units"),
including a 1,111,111 Unit allotment for oversubscriptions, each consisting of
(i) one share of its Class A Common Stock, (ii) one warrant, entitling the
holder thereof to purchase one share of Class A Common Stock at $5.00 per share
(the "Unit Warrants"), and (iii) one right, entitling the holder thereof to
receive, without payment of additional consideration, an amount of shares of
Class A Common Stock in periodic distributions based upon the resolution value
of certain problem assets currently held in the Bank's portfolio and the Bank's
expenses in administering and carrying such problem assets (the "Rights"). THE
FOREGOING ASSUMES THE APPROVAL OF ITEMS (II), (III) AND (IV) AT THE ANNUAL
MEETING AND THE RESULTING 1-FOR-10 REVERSE STOCK SPLIT. THE UNIT WARRANTS ARE
SUBSTANTIALLY IDENTICAL TO THE WARRANTS GRANTED IN CONNECTION WITH THE
CONVERSION OF THE OUTSTANDING SHARES OF SERIES C PREFERRED STOCK DESCRIBED IN
ITEM (II) ABOVE. THE COMPANY IS OFFERING THE UNITS AT A PRICE OF $3.60 PER
UNIT. ASSUMING (I) THE SALE OF THE MINIMUM NUMBER OF UNITS IN THE PRIVATE
PLACEMENT, BUT (II) NO EXERCISE OF ANY OF THE WARRANTS OR THE UNIT WARRANTS AND
(III) NO SHARES ARE ISSUED PURSUANT TO THE RIGHTS, THE SHARES ISSUED IN THE
PRIVATE PLACEMENT WILL REPRESENT 51.0% OF THE TOTAL NUMBER OF OUTSTANDING CLASS
A COMMON STOCK AFTER THE PRIVATE PLACEMENT. THE FINAL NUMBER OF SHARES, PRICE
AND OTHER TERMS AND CONDITIONS OF THE PRIVATE PLACEMENT IS SUBJECT TO CHANGE
AND WILL BE DETERMINED BY THE BOARD OF DIRECTORS OF THE COMPANY BASED UPON
INTEREST IN THE PRIVATE PLACEMENT EXPRESSED BY PROSPECTIVE INVESTORS;

(vi) to approve and adopt the 1993 Executive Stock Option Plan and the
1993 Nonemployee Directors Stock Option Plan;

(vii) to ratify the Board of Directors' selection of KPMG Peat Marwick,
independent public accountants, as the independent accounting firm for the
Company during the fiscal years ending December 31, 1993 and December 31, 1994;
and

(viii) to act upon such other business as may properly come before the
meeting or any adjournment thereof.

We hope that you will be able to attend the Annual Meeting. In any
event, please complete, date, sign, and promptly return the appropriate
enclosed proxy for the Class A Common Stock, the Series B Preferred Stock
and/or the Series C Preferred Stock. It is important that your shares be
represented at the Annual Meeting.

Sincerely yours,

KENT D. PRICE
Chairman of the Board and,
Chief Executive Officer

YOUR VOTE IS IMPORTANT

YOU ARE URGED TO COMPLETE, DATE, SIGN, AND PROMPTLY RETURN YOUR PROXY
IN THE ENCLOSED ENVELOPE WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING.

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BANK OF SAN FRANCISCO COMPANY
HOLDING COMPANY
550 MONTGOMERY STREET, 10TH FLOOR
SAN FRANCISCO, CALIFORNIA 94111

NOTICE OF 1994 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON APRIL 20, 1994

To the Holders of the Class A Common Stock, par value $.01 per share
(the "Class A Common Stock"), the 8% Series B Convertible Preferred Stock, par
value $.01 per share (the "Series B Preferred Stock"), and the 9% Series C
Perpetual Preferred Stock, par value $.01 per share (the "Series C Preferred
Stock"), of Bank of San Francisco Company Holding Company (the "Company"):

The 1994 annual meeting of the stockholders of the Company will be
held on April 20, 1994 at 2:00 p.m. local time, in the Boardroom of the
Company, 550 Montgomery Street, 11th Floor, San Francisco, California 94111
(the "Annual Meeting") for the following purposes:

1. To elect five (5) of the nine (9) authorized directors of the
Company, three (3) to serve two-year terms and two (2) to
serve for three-year terms;

2. To authorize the conversion of each share of the Series C
Preferred Stock into 40 shares of Class A Common Stock and 40
warrants (the "Warrants"), with each Warrant granting the
right to purchase an additional share of Class A Common
Stock, exercisable at $.50 per share (the "Conversion"), and
in connection with said Conversion to amend the Company's
Certificate of Incorporation (the "Certificate"), including
the Certificate of Designations of Rights, Preferences,
Privileges and Restrictions relating to the Series C Preferred
Stock (the "Certificate of Designation"), (a) to increase the
authorized number of shares of Class A Common Stock to
400,000,000 (subject to subsequent decrease of the number of
authorized shares to 40,000,000 through a 1-for-10 reverse
stock split if the stockholders approve Item 4 below)) so as
to permit the Conversion and increase the ability of the
Company to raise capital in the future through the issuance of
Class A Common Stock and securities convertible into Class A
Common Stock, and (b) to amend the Certificate of Designation
to provide that all outstanding shares of Series C Preferred
Stock will automatically be converted into Class A Common
Stock and Warrants, in accordance with the conversion rights
set forth in the Certificate of Designation, on April 29,
1994. SUBJECT TO THE DILUTION WHICH IS EXPECTED AS A RESULT
OF THE PROPOSED PRIVATE PLACEMENT BY THE COMPANY WHICH IS
DESCRIBED IN ITEM 5 BELOW, THE CONVERSION OF THE OUTSTANDING
SHARES OF SERIES C PREFERRED STOCK WOULD RESULT IN A
SUBSTANTIAL INCREASE IN THE VOTING POWER AND CONTROL OVER THE
COMPANY HELD BY THE COMPANY'S MAJORITY STOCKHOLDER, INCREASING
HIS OWNERSHIP FROM THE CURRENT 66.2% OF THE VOTING POWER OF
THE COMPANY TO AT LEAST 92.6%, ASSUMING HE DOES NOT DISPOSE OF
ANY OF HIS SHARES, AND AS MUCH AS 95.9% IF HE WERE TO EXERCISE
ALL OF THE WARRANTS HE WOULD HOLD UPON COMPLETION OF THE
CONVERSION;

3. To increase the authorized number of shares of the Company's
Preferred Stock to 5,000,000 in order to increase the ability
of the Company to raise capital in the future through the
issuance of Preferred Stock;

4. To authorize the amendment and restatement of the Company's
Certificate to (a) reclassify the Company's Class B Common
Stock as and into Class A Common Stock, (b) effect a 1-for-10

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reverse stock split of the Class A Common Stock and thereby to
decrease the authorized number of shares of the Company's
Class A Common Stock to 40,000,000, (c) change the name of
the Company to The San Francisco Company, and (d) update
certain provisions of the Certificate;

5. To authorize the issuance of additional shares of Class A
Common Stock in excess of twenty percent (20%) of the number
of shares of Class A Common Stock outstanding following the
Conversion, with the number of shares, price and other terms
and conditions of such offering determined by the Board of
Directors of the Company after negotiation with potential
investors. The shares of Class A Common Stock to be issued
may be issued at less than current book and market value per
share. The Company is currently proposing a private placement
(the "Private Placement") of up to 7,222,222 units (the
"Units"), including a 1,111,111 Unit allotment for
oversubscriptions, each consisting of (i) one share of its
Class A Common Stock, (ii) one warrant, entitling the holder
thereof to purchase one share of Class A Common Stock at $5.00
per share (the "Unit Warrants"), and (iii) one right,
entitling the holder thereof to receive, without payment of
additional consideration, an amount of shares of Class A
Common Stock in periodic distributions based upon the
resolution value of certain problem assets currently held in
the Bank's portfolio (the "Rights"). THE FOREGOING ASSUMES
THE APPROVAL OF ITEMS (2), (3) AND (4) AT THE ANNUAL MEETING
AND THE RESULTING 1-FOR-10 REVERSE STOCK SPLIT. THE COMPANY
IS OFFERING THE UNITS AT A PRICE OF $3.60 PER UNIT. ASSUMING
(I) THE SALE OF THE MINIMUM NUMBER OF UNITS IN THE PRIVATE
PLACEMENT, BUT (II) NO EXERCISE OF ANY OF THE WARRANTS OR THE
UNIT WARRANTS AND (III) NO SHARES ARE ISSUED PURSUANT TO THE
RIGHTS, THE SHARES ISSUED IN THE PRIVATE PLACEMENT WILL
REPRESENT 51.0% OF THE TOTAL NUMBER OF OUTSTANDING CLASS A
COMMON STOCK AFTER THE PRIVATE PLACEMENT. THE FINAL NUMBER OF
SHARES, PRICE AND OTHER TERMS AND CONDITIONS OF THE PRIVATE
PLACEMENT IS SUBJECT TO CHANGE AND WILL BE DETERMINED BY THE
BOARD OF DIRECTORS OF THE COMPANY BASED UPON INTEREST IN THE
PRIVATE PLACEMENT EXPRESSED BY PROSPECTIVE INVESTORS.

6. To approve and adopt the 1993 Executive Stock Option Plan and
the 1993 Nonemployee Directors Stock Option Plan;

7. To ratify the Board of Directors' selection of KPMG Peat
Marwick, independent public accountants, as the independent
accounting firm for the Company during the fiscal years ending
December 31, 1993 and December 31, 1994; and

8. To act upon such other business as may properly come before
the meeting or any adjournment thereof.

These matters are more fully discussed in the enclosed Proxy Statement.

Holders of Class A Common Stock, Series B Preferred Stock and Series C
Preferred Stock of the Company of record at the close of business on March 24,
1994 are entitled to vote at the 1994 Annual Meeting to the extent and in the
manner set forth in the Proxy Statement.

The Board of Directors has nominated Kent D. Price, Steven R. Champion
and Carl D. Gustavson to serve as Class II directors for terms until the
Company's 1996 Annual Meeting of Stockholders and Rodney D. Freed and Willard
D. Sharpe to serve as Class III directors for terms until the Company's 1997
Annual Meeting of Stockholders. Any stockholder entitled to vote for directors
may nominate candidates for election as directors of the Company; provided,
however, that nominations for director of the Company by any person other than
the Board of Directors may be made only by a record stockholder who has
delivered a written notice

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to the Secretary of the Company no later than the close of business sixty (60)
days in advance of the Annual Meeting or ten (10) days after the date on which
notice of the Annual Meeting is first given to stockholders, whichever is
later. Such stockholder's notice shall set forth (a) as to each person, if
any, whom the stockholder proposes to nominate for election or re-election as a
director: (i) the name, age, business address and residence address of such
person, (ii) the principal occupation or employment of such person, (iii) the
Class and number of shares of the Company which are beneficially owned by such
person, and (iv) any other information relating to such person that is required
to be disclosed in solicitations of proxies for election of directors, or is
otherwise required, in each case pursuant to Regulation 14A under the
Securities Exchange Act of 1934 as amended (including without limitation such
person's written consent to being named in the proxy statement, if any, as a
nominee and to serving as a director if elected); and (b) as to the stockholder
giving the notice: (i) the name and address of such stockholder, as they
appear on the Company's books, and (ii) the Class and number of shares of the
Company which are beneficially owned by such stockholder.

At the request of the Board of Directors, any person nominated by the
Board for election as a director shall furnish to the Secretary of the Company
that information required to be set forth in the stockholder's notice of
nomination which pertains to the nominee. No person shall be eligible for
election as a director of the Company unless nominated in accordance with the
procedures set forth herein. The chairman of the Annual Meeting, if the facts
warrant, shall determine and declare at the Annual Meeting that a nomination
was not made in accordance with the procedures prescribed herein, and if he
should so determine, he shall so declare at the Annual Meeting and the
defective nomination shall be disregarded.

Any person giving a proxy has the power to revoke or suspend it
before its exercise. It is revocable before the Annual Meeting by sending
written notice or a duly executed proxy bearing a later date to Linda M.
Tanner, Assistant Secretary of the Company, at the principal executive offices
of the Company. In addition, a stockholder giving the enclosed proxy may
revoke it by attending the Annual Meeting and electing to vote in person,
before any vote is taken. Unless otherwise instructed, each valid proxy
returned that is not revoked will be voted FOR the election as directors of the
person or persons specified on such proxy card; FOR each of the proposals
listed above; and at the proxy holder's discretion, upon management's
direction, on such other matters, if any, as may come before the Annual Meeting
(including any proposal to adjourn the Annual Meeting).

YOUR VOTE IS IMPORTANT. PLEASE SIGN AND DATE THE APPROPRIATE ENCLOSED
PROXY CARD OR CARDS AND RETURN THEM PROMPTLY IN THE ENVELOPE PROVIDED WHETHER
OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING. THE BOARD OF DIRECTORS
UNANIMOUSLY RECOMMENDS A VOTE FOR THE ELECTION AS DIRECTORS OF THE PERSONS
NAMED ON THE PROXY CARD ENCLOSED HEREIN, AND FOR EACH OF THE OTHER PROPOSALS.
THE DIRECTORS OF THE COMPANY INTEND TO VOTE ALL OF THEIR SHARES FOR THE
APPROVAL OF THE PROPOSALS DESCRIBED ABOVE.

By Order of the Board of Directors,

Linda M. Tanner, Assistant Secretary

April 4, 1994
(approximate mailing date
of proxy material)

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PROXY STATEMENT
OF
BANK OF SAN FRANCISCO COMPANY
HOLDING COMPANY
550 MONTGOMERY STREET, 10TH FLOOR
SAN FRANCISCO, CALIFORNIA 94111
(415) 391-9000

GENERAL INFORMATION

This Proxy Statement is furnished in connection with the solicitation
of the enclosed proxy by, and on behalf of, the Board of Directors of Bank of
San Francisco Company Holding Company (the "Company"), a Delaware corporation
and bank holding company for Bank of San Francisco (the "Bank"). The enclosed
proxy is for use at the 1994 Annual Meeting of Stockholders of the Company to
be held at the Boardroom of the Company, 550 Montgomery Street, 11th Floor, San
Francisco, California 94111 at 2:00 p.m. local time on April 20, 1994 and at
all postponements or adjournments thereof (the "Annual Meeting"). It is
expected that this Proxy Statement and the accompanying Notice of Annual
Meeting of Stockholders will be mailed to stockholders on or about April 4,
1994.

PURPOSE OF MEETING

At the Annual Meeting, holders of the Company's Class A Common Stock,
par value $.01 per share (the "Class A Common Stock"), 8% Series B Convertible
Preferred Stock, par value $.01 per share (the "Series B Preferred Stock") and
9% Series C Perpetual Preferred Stock, par value $.01 per share (the "Series C
Preferred Stock") will be asked to take the following actions:

1. To elect five (5) of the nine (9) authorized directors of the
Company, three (3) to serve two-year terms and two (2) to
serve for three-year terms;

2. To authorize the conversion of each share of the Series C
Preferred Stock into 40 shares of Class A Common Stock and 40
warrants (the "Warrants"), each Warrant granting the right to
purchase an additional share of Class A Common Stock,
exercisable at $.50 per share (the "Conversion"), and in
connection with said Conversion to amend the Company's
Certificate of Incorporation (the "Certificate"), including
the Certificate of Designations of Rights, Preferences,
Privileges and Restrictions relating to the Series C Preferred
Stock (the "Certificate of Designation"), (a) to increase the
authorized number of shares of Class A Common Stock to
400,000,000 (subject to the subsequent decrease of the number
of authorized shares to 40,000,000 through a 1-for-10 reverse
stock split if the stockholders approve Item 4 below) so as to
permit the Conversion and increase the ability of the Company
to raise capital in the future through the issuance of Class A
Common Stock and securities convertible into Class A Common
Stock, and (b) to amend the Certificate of Designation to
provide that all outstanding shares of Series C Preferred
Stock will automatically be converted into Class A Common
Stock and Warrants, in accordance with the conversion rights
set forth in the Certificate of Designation, on April 29,
1994. SUBJECT TO THE DILUTION WHICH IS EXPECTED AS A RESULT
OF THE PROPOSED PRIVATE PLACEMENT BY THE COMPANY WHICH IS
DESCRIBED IN ITEM 5 BELOW, THE CONVERSION OF THE OUTSTANDING
SHARES OF SERIES C PREFERRED STOCK WOULD RESULT IN A
SUBSTANTIAL INCREASE IN THE VOTING POWER AND CONTROL OVER THE
COMPANY HELD BY THE COMPANY'S MAJORITY STOCKHOLDER, INCREASING
HIS OWNERSHIP FROM THE CURRENT 66.2% OF THE VOTING POWER OF
THE COMPANY TO AT LEAST 92.6%, ASSUMING HE

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<PAGE> 8

DOES NOT DISPOSE OF ANY OF HIS SHARES, AND AS MUCH AS 95.9% IF
HE WERE TO EXERCISE ALL OF THE WARRANTS HE WOULD HOLD UPON
COMPLETION OF THE CONVERSION;

4. To authorize the amendment and restatement of the Certificate
to (a) reclassify the Class B Common Stock as and into Class A
Common Stock, (b) effect a 1-for-10 reverse stock split of the
Class A Common Stock and thereby to decrease the authorized
number of shares of the Company's Class A Common Stock to
40,000,000, (c) change the name of the Company to The San
Francisco Company, and (d) update certain provisions of the
Certificate;

6. To approve and adopt the 1993 Executive Stock Option Plan and
the 1993 Nonemployee Directors Stock Option Plan
(collectively, the "New Stock Option Plans");

8. To act upon such other business as may properly come before
the meeting or any adjournment thereof.

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<PAGE> 9
VOTING SECURITIES

Only stockholders of record on March 24, 1994 (the "Record Date") are
entitled to notice of and to vote at the Annual Meeting. At the close of
business on that date, the Company had outstanding eight million, eight
hundred and ninety-nine thousand, nine hundred thirty-two (8,899,932) shares
of its Class A Common Stock, sixteen thousand, five hundred ninety-one (16,591)
shares of its Series B Preferred Stock and nine hundred thousand (900,000)
shares of its Series C Preferred Stock.

Each holder of the Class A Common Stock, the Series B Preferred Stock
and the Series C Preferred Stock is entitled, with respect to each matter as
to which such holder is entitled to vote, to one (1) vote, in person or by
proxy, for each share of the Class A Common Stock, Series B Preferred Stock or
Series C Preferred Stock outstanding in his or her name on the transfer books
of the Company as of the Record Date.

REVOCABILITY OF PROXIES

VOTES REQUIRED

Holders of Class A Common Stock, Series B Preferred Stock and Series C
Preferred Stock are entitled to vote on each of the proposals to be presented
at the Annual Meeting. The following paragraphs explain, for each proposal,
the vote required for adoption. In each case, a quorum must be present for the
vote to be valid.

PROPOSAL ONE: ELECTION OF DIRECTORS, as to the Class II directors,
the validly-nominated nominees for election as directors who rank first, second
and third in number of votes received from holders of the Class A Common Stock,
the Series B Preferred Stock and the Series C Preferred Stock represented and
voting together as a single Class will be elected as directors, and as to the
Class III directors, the validly-nominated nominees for election as directors
who rank first and second in number of votes received from holders of the Class
A Common Stock, the Series B Preferred Stock and the Series C Preferred Stock
represented and voting together as a single Class will be elected as directors,
even if some or all of such nominees receive less than a majority of the total
votes.

PROPOSAL TWO: AUTHORIZATION OF CONVERSION OF SERIES C PREFERRED
STOCK, AND AMENDMENT OF CERTIFICATE OF INCORPORATION TO INCREASE THE AUTHORIZED
NUMBER OF SHARES OF CLASS A COMMON STOCK AND TO CHANGE THE REQUIRED CONVERSION
DATE OF SERIES C PREFERRED STOCK requires an affirmative vote of the holders of
a majority of the shares of the Class A Common Stock and the Series B Preferred
Stock represented and voting together as a single Class, and an affirmative
vote of the holders of a majority of the shares of the Series C Preferred Stock
represented and voting as a separate Class.

PROPOSAL THREE: AUTHORIZATION OF AMENDMENT OF CERTIFICATE OF
INCORPORATION TO INCREASE THE AUTHORIZED NUMBER OF SHARES OF PREFERRED STOCK
requires an affirmative vote of the holders of a majority of the shares of the
Class A Common Stock, the Series B Preferred Stock and the Series C Preferred
Stock represented and voting together as a single class, and of the holders of
a majority of the shares of the Series B Preferred Stock and the Series C
Preferred Stock represented and voting together as a single Class of Preferred
Stock.

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<PAGE> 10
PROPOSAL FOUR: AUTHORIZATION OF AMENDMENT AND RESTATEMENT OF
CERTIFICATE OF INCORPORATION requires an affirmative vote of the holders of a
majority of the shares of the Class A Common Stock, the Series B Preferred
Stock and the Series C Preferred Stock represented and voting together as a
single class, and of the holders of a majority of the shares of the Class A
Common Stock represented and voting as a single Class.

PROPOSAL FIVE: AUTHORIZATION OF ISSUANCE OF ADDITIONAL CLASS A COMMON
STOCK, WARRANTS AND RIGHTS requires an affirmative vote of the holders of a
majority of the shares of the Class A Common Stock, the Series B Preferred
Stock and the Series C Preferred Stock represented and voting together as a
single Class.

PROPOSAL SIX: APPROVAL OF THE 1993 EXECUTIVE STOCK OPTION PLAN AND
THE 1993 NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN and PROPOSAL SEVEN:
RATIFICATION OF SELECTION OF INDEPENDENT ACCOUNTING FIRM require an affirmative
vote of the holders of a majority of the shares of the Class A Common Stock,
the Series B Preferred Stock and the Series C Preferred Stock represented and
voting together as a single Class.

Such other matters, if any, as may properly come before the Annual
Meeting will generally require the affirmative vote of the holders of a
majority of the shares of the Class A Common Stock, the Series B Preferred
Stock and the Series C Preferred Stock represented and voting together as a
single Class.

IF THE COMPANY'S MAJORITY STOCKHOLDER VOTES ALL OF HIS SHARES OF CLASS
A COMMON STOCK AND SERIES C PREFERRED STOCK IN FAVOR OF ANY OR ALL OF THESE
PROPOSALS, INCLUDING PROPOSAL TWO, THEN PASSAGE OF SUCH PROPOSALS WOULD BE
ASSURED. WHILE THE MAJORITY STOCKHOLDER HAS NOT ENTERED INTO ANY AGREEMENTS AS
TO THE MANNER IN WHICH HE WILL VOTE HIS SHARES, HE HAS EXPRESSED HIS INTENT TO
VOTE IN FAVOR OF ALL OF THE ABOVE PROPOSALS.

With regard to the election of directors, votes may be cast in favor
or withheld; votes that are withheld will be excluded entirely from the vote
and will have no effect. Abstentions may be specified on all proposals (other
than the election of directors) and will be counted as shares that are present
or represented at the Annual Meeting for purposes of determining a quorum on
the proposal on which the abstention is specified. However, because such
shares will be counted as represented at the Annual Meeting, and because the
success of the proposals (other than the election of directors) is measured
based on the number of affirmative votes out of the number of shares
represented at the Annual Meeting, abstentions will have the effect of a
negative vote.

Under the rules of the American Stock Exchange ("AMEX"), brokers who
hold shares in street name for customers have the authority to vote on certain
items when they have not received instructions from beneficial owners; on other
items such brokers do not have the authority to vote. Under applicable
Delaware law, broker non-votes are counted for the purpose of determining the
presence or absence of a quorum for the transaction of business but are not
otherwise counted. Therefore, broker non-votes will have no effect on the
outcome of the election of directors but will have the same effect as a vote
against the other proposals.

Unless otherwise instructed, each valid proxy returned which is not
revoked will be voted FOR the election as directors of the persons specified on
such proxy card, FOR each of the other proposals, and at the proxy holders'
discretion, upon management's direction, on such other matters, if any, that
may come before the Annual Meeting (including any proposal to adjourn the
Annual Meeting).

-4-
<PAGE> 11
SOLICITATION OF PROXIES

The Company will bear the entire cost of preparing, assembling,
printing and mailing proxy materials furnished by the Board of Directors to
stockholders. Copies of proxy materials also will be furnished to brokerage
houses, fiduciaries and custodians to be forwarded to the beneficial owners of
the Class A Common Stock, the Series B Preferred Stock and the Series C
Preferred Stock. In addition to the solicitation of proxies by use of the
mail, some of the officers, directors and regular employees of the Company and
the Bank may (without additional compensation) solicit proxies by telephone or
personal interview, the costs of which the Company will bear.

In the event that any of the nominees for election as director becomes
unavailable, which the Company does not expect, it is intended that, pursuant to
the accompanying proxy, votes will be cast for such substitute nominee or
nominees as may be designated by the Board of Directors, unless the Board of
Directors reduces the number of directors.

ANNUAL REPORT

A copy of the Company's Annual Report on Form 10-K for the twelve
months ended December 31, 1993 (the "1993 Annual Report") accompanies this
Proxy Statement. Additional copies of the 1993 Annual Report are available
without cost upon request by writing to Linda M. Tanner, Assistant Secretary,
Bank of San Francisco Company Holding Company, 550 Montgomery Street, 10th
Floor, San Francisco, California 94111.

BENEFICIAL OWNERSHIP OF THE CLASS A COMMON STOCK, THE SERIES B PREFERRED STOCK
AND THE SERIES C PREFERRED STOCK

CLASS A COMMON STOCK

The following table sets forth information concerning the beneficial
ownership of the Class A Common Stock as of March 24, 1994, the latest
practicable date prior to filing of this Proxy Statement, by (i) each person
known to the Board of Directors to be the beneficial owner of more than five
percent (5%) of the Class A Common Stock; (ii) each director of the Company and
each nominee for director; (iii) the Company's Chief Executive Officer at the
end of the 1993 fiscal year, and the two most highly compensated executive
officers at the end of the 1993 fiscal year other than the Chief Executive
Officer and who had total compensation in excess of $100,000; and (iv)
directors, nominees and current executive officers of the Company and the Bank
as a group. Other than as set forth below and in the footnotes thereto, based
upon filings made with the Securities and Exchange Commission (the "SEC"), the
Company is not aware of any person who is the beneficial owner of five percent
(5%) or more of the Class A Common Stock.

-5-
<PAGE> 12

<TABLE>
<CAPTION>
PERCENTAGE
NUMBER OF SHARES OF ASSUMING
CLASS A COMMON PERCENT ADOPTION OF
STOCK BENEFICIALLY OF PROPOSAL
BENEFICIAL OWNER (1) OWNED CLASS TWO(10)
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Putra Masagung 5,600,000(2) 62.92(2) 92.65(11)

Donald R. Stephens (3) 639,044 7.18 1.42

Donna Miller Casey (4)(5)(9) 17,723 * *

David R. Holbrooke, M.D. (5) 121,100 1.28 *

Gordon B. Swanson (6) 20,056 * *

Kent D. Price (7) 0 * *

Steven R. Champion (7) 0 * *

Rodney D. Freed 0 * *

Carl D. Gustavson 0 * *

Willard D. Sharpe 5,000 * *

All directors, nominees and current 163,879 1.73 *
executive officers of the Bank as a
group (10 persons) (8)(9)
</TABLE>

The address of Mr. Masagung (also referred to herein as the
"Principal Stockholder") is 55 Jalan MH Thamrin, Jakarta, Indonesia. The
address of Mr. Stephens is 500 Sansome Street, Suite 600, San Francisco, CA
94111.

- --------------------
* represents less than 1% of the Class A Common Stock outstanding.

(1) The persons listed above have sole voting and investment power over
the shares attributed to them, subject to community property laws
where applicable, unless otherwise indicated in these footnotes.

(2) Does not include up to 102,207 shares which Mr. Masagung has the
right to acquire for $2.50 per share through the exercise of warrants
granted by the Company (the "Anti-dilution Warrants") if participants
in the Company's former stock option plans exercise their options (Mr.
Masagung may acquire 1.0408 (i.e., 51/49) shares for each share that
is issued by the Company as a result of exercise of any stock option
that was outstanding as of July 13, 1992. Options to acquire 98,200
shares were granted by the Company prior to July 13, 1992 and remain
in existence. The product of 98,200 and 1.0408 equals 102,207). All
of such options have an exercise price higher than the current trading
price of the Class A Common Stock. Does not include (i) the 36,000,000
shares of Class A Common Stock that Mr. Masagung would be entitled
(and on April 29, 1994 required) to receive, subject to stockholder
approval of the conversion feature of the Series C Preferred Stock,
upon conversion of the 900,000 shares of Series C Preferred Stock
currently owned by him into shares of Class A Common Stock and
Warrants, or (ii) the 36,000,000 additional shares of Class A Common
Stock that he would be entitled to receive upon exercise of such
Warrants for $0.50 per share. See "Series C Preferred Stock" below.

(3) Includes 23,340 shares held in trusts for the benefit of Mr. Stephens'
children for which Mr. Stephens disclaims beneficial ownership. Mr.
Stephens resigned as a director of the Company on April 11, 1993.

(4) Includes 908 shares held by Mrs. Casey's children for which Mrs. Casey
disclaims beneficial ownership.

-6-
<PAGE> 13
(5) Includes 7,700 shares that the named individual has the right to
acquire through the exercise of stock options granted by the Company.

(6) Includes 7,300 shares that the named individual has the right to
acquire through the exercise of stock options granted by the Company.

(7) Does not include options to purchase shares of Class A Common Stock
which the Company has agreed to grant to Messrs. Price and Champion as
part of the consideration for Messrs. Price and Champion to enter into
Employment Agreements with the Company, subject to the stockholders'
approval of PROPOSAL SIX. Under such Employment Agreements, each of
Messrs. Price and Champion would receive options to purchase that
number of shares equal to 4% of the outstanding shares of Class A
Common Stock, with anti-dilution provisions requiring the grant of
additional options so as to maintain the 4% ratio if more shares of
Class A Common Stock become outstanding. The price at which the
options granted in the initial 4% grant could be exercised would be
$0.50, the effective conversion price per share in the Company's most
recent sale of Series C Preferred Stock to the Principal Stockholder
(without giving effect to the 1-for-10 reverse stock split described
in PROPOSAL FOUR). The price at which subsequent anti-dilution
options could be exercised would be the fair market value at the date
of grant. The options would vest non-ratably over a ten-year period.

Also does not include Warrants to purchase 1.5 million shares of
Class A Common Stock with an exercise price of $0.50 per share
(without giving effect to the 1-for-10 reverse stock split described
in PROPOSAL FOUR), which the Principal Stockholder has agreed to
transfer to each of Messrs. Price and Champion, upon conversion of the
Company's Series C Preferred Stock and upon the successful completion
of the Private Placement

(8) This group includes all current directors and executive officers of
the Company and of the Bank. Includes an aggregate of 30,000 shares
that directors and executive officers have the right to acquire
through the exercise of stock options granted by the Company. Does
not include any of the options that may be granted to Messrs. Price
and Champion as described in footnote 7 above.

(9) Does not include 39,772 unallocated shares of Class A Common Stock
held by the Bank of San Francisco Company Holding Company Employee
Stock Ownership Plan (the "ESOP"), of which Mrs. Casey is a
Co-Trustee. Each participant in the ESOP may direct the Co-Trustees
as to the manner in which shares of Class A Common Stock allocated to
his or her account shall be voted. The Co-Trustees may not vote
shares of Class A Common Stock allocated to participants' accounts as
to which they have not received voting instructions. The ESOP
provides that the Co-Trustees shall vote shares of Class A Common
Stock held by the ESOP that are not allocated to participants'
accounts in accordance with instructions received from the ESOP
Committee. The ESOP Committee is composed of Mrs. Casey and Linda M.
Tanner, an officer of the Bank. The 39,772 unallocated shares of
Class A Common Stock held by the ESOP are not included in the above
table as being beneficially owned by Mrs. Casey.

(10) Assumes that (a) PROPOSAL TWO is adopted, (b) Mr. Masagung converts
all of his 900,000 shares of Series C Preferred Stock into 36,000,000
shares of Class A Common Stock and Warrants to acquire an additional
36,000,000 shares, which conversion would be mandatory on April 29,
1994 if PROPOSAL TWO is adopted, (c) as the Company understands is
currently contemplated, Mr. Masagung does not exercise any of the
Warrants, and (d) the number of shares of Class A Common Stock
beneficially owned by all persons other than Mr. Masagung does not
change between March 24, 1994 and the date of the conversion. The
percentages shown in this table for Mr. Masagung differ from the
percentages of his control of the total voting owner of the Company
shown on page 1, because the percentages in this table reflect only
ownership of the Class A Common Stock

(11) Does not include any units which may be purchased by Mr. Putra
Masagung or Mr. Oka Masagung, his brother, in connection with the
Private Placement. Mr. Putra Masagung has indicated to management of
the Company that he is considering the possible further investment of
$1,000,000 in the Company by the purchase of Units in the Private
Placement. Mr. Oka Masagung has indicated to management of the Company
that he intends to subscribe for up to $2,000,000 of Units in the
Private Placement.

Mr. Kaharudin Latief of Jakarta, Indonesia has provided notice to the
Federal Reserve Board (the "FRB") and applied to the California State Banking
Department (the "Banking Department") for approval to acquire shares of Series
C Preferred Stock. If and when regulatory clearance is received, Mr. Latief
plans to acquire from Mr. Masagung 300,000 shares of Series C Preferred Stock
(or, assuming that PROPOSAL TWO is approved, the shares of Class A Common Stock
and Warrants into which such shares of Series C Preferred Stock are converted)
through cancellation of an unsecured, personal loan in the amount of $6,000,000
which Mr. Latief previously extended to Mr. Masagung. Mr. Masagung used the
proceeds of this loan to acquire 300,000 shares of Series C Preferred Stock
from the Company. If Mr. Latief consummates this transaction, and if the
conversion feature of the Series C Preferred Stock (including mandatory
conversion on April 29, 1994) is approved by the Company's stockholders, Mr.
Latief would hold 12,000,000 shares of

-7-
<PAGE> 14

Class A Common Stock and Warrants to acquire an additional 12,000,000 shares
of Class A Common Stock at an exercise price of $0.50 per share.

Mr. Latief has indicated to management that if his acquisition of
Series C Preferred Stock (or Class A Common Stock if PROPOSAL TWO is adopted)
is consummated, Mr. Latief will seek appointment of himself or his designee as
a director of the Company (but not the Bank), subject to obtaining required
regulatory non-objection. Management of the Company expects to recommend to
the Board of Directors that Mr. Latief or his designee be added to the Board if
his acquisition is completed, subject to regulatory clearance. According to
information provided by Mr. Latief's representatives, if Mr. Latief does not
receive all required approvals to purchase shares of the Company, Mr. Latief
will not acquire any shares of Series C Preferred Stock (or Class A Common
Stock if PROPOSAL TWO is adopted), and will expect repayment in full of the
Principal Stockholder's indebtedness to Mr. Latief.

The following table sets forth information concerning the beneficial
ownership of the Class A Common Stock by Mr. Masagung, Mr. Latief and by all
shareholders other than Mr. Masagung, Mr. Latief and the current directors and
executive officers of the Company (the "non-affiliated stockholders") on March
24, 1994 assuming that the conversion feature of the Series C Preferred Stock
(including mandatory conversion on April 29, 1994) is approved by the
stockholders of the Company, that Mr. Latief receives regulatory clearance to
and does acquire 300,000 shares of Series C Preferred Stock (or the shares of
Class A Common Stock and Warrants into which such shares of Series C Preferred
Stock are converted) from Mr. Masagung, that if either Mr. Masagung or Mr.
Latief exercise Warrants they will exercise all of the Warrants they hold, and
that the ownership of Class A Common Stock otherwise does not change between
March 24, 1994 and April 29, 1994. The table does not assume the completion of
the Private Placement. Because Mr. Stephens is no longer a director or officer
of the Company or the Bank, and is not subject to the reporting and short-swing
profits provisions of Section 16 of the Securities Exchange Act of 1934, his
holdings are included with the non-affiliated stockholders.

<TABLE>
<CAPTION>
STOCKHOLDER SHARES AND SHARES AND SHARES AND SHARES AND
PERCENTAGE OWNED PERCENTAGE OWNED PERCENTAGE OWNED PERCENTAGE OWNED
ASSUMING WARRANTS ASSUMING ONLY MR. ASSUMING ONLY MR. ASSUMING ALL
NOT EXERCISED MASAGUNG LATIEF EXERCISES WARRANTS EXERCISED
EXERCISES WARRANTS
WARRANTS
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Putra Masagung 29,600,000 53,600,000 29,600,000 53,600,000
(65.92%) (77.79%) (52.02%) (66.25%)

Kaharudin Latief 12,000,000 12,000,000 24,000,000 24,000,000
(26.73%) (17.42%) (42.18%) (29.67%)
Non-Affiliated 3,101,253 3,101,253 3,101,253 3,101,253
Stockholders (6.91%) (4.50%) (5.45%) (3.83%)
</TABLE>

SEE "PROPOSAL FIVE: AUTHORIZATION OF ADDITIONAL CLASS A COMMON STOCK, WARRANTS
AND RIGHTS" WITH RESPECT TO ADDITIONAL INFORMATION REGARDING THE POTENTIAL
IMPACT OF THE PRIVATE PLACEMENT ON THE HOLDERS OF THE COMPANY'S CLASS A COMMON
STOCK.

SERIES B PREFERRED STOCK

The following table sets forth information concerning the beneficial
ownership of the Series B Preferred Stock as of March 24, 1994, by (i) the
only persons known to the Board of Directors to be the beneficial

-8-
<PAGE> 15

owners of more than 5% of the Series B Preferred Stock, (ii) each director of
the Company and each nominee for director; (iii) each of the named executive
officers; and (iv) directors, nominees and named executive officers of the
Company and the Bank as a group. Other than as set forth below and in the
footnotes thereto, based on filings with the SEC, the Company is not aware of
any person who is the beneficial owner of 5% or more of the Series B Preferred
Stock.

<TABLE>
<CAPTION>
NUMBER OF SHARES
OF SERIES B PERCENT
PREFERRED STOCK OF
BENEFICIAL OWNER (1) BENEFICIALLY OWNED (2) CLASS
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C>
Gordon B. Swanson . . . . . . . . . . . . . . . . . . . . 7,200 43.4%
John A. Beal . . . . . . . . . . . . . . . . . . . . . . 2,143 12.9
John Volckman . . . . . . . . . . . . . . . . . . . . . 3,500 21.1
Donna Miller Casey (3) . . . . . . . . . . . . . . . . . 0 *
David R. Holbrooke, M.D. . . . . . . . . . . . . . . . . 0 *
Kent D. Price . . . . . . . . . . . . . . . . . . . . . 0 *
Steven R. Champion . . . . . . . . . . . . . . . . . . . 0 *
Rodney D. Freed . . . . . . . . . . . . . . . . . . . . . 0 *
Carl D. Gustavson . . . . . . . . . . . . . . . . . . . 0 *
Willard D. Sharpe . . . . . . . . . . . . . . . . . . . 0 *
All directors, nominees and current executive officers of the
Company and the Bank as a group (10 persons) (3) . . . . 7,200 43.4
</TABLE>

The address of Mr. Beal is 225 Rollins Road, Burlingame, California
94010, the address of Mr. Volckman is 127 Alta Vista, Atherton, California
94025, and the address of Mr. Swanson for purposes of his ownership of the
Series B Preferred Stock is the principal executive office of the Company.
- ------------------------
* represents less than 1% of the Series B Preferred Stock outstanding.

(2) The holders of Series B Preferred Stock are entitled at any time to
convert their shares of Series B Preferred Stock into shares of the
Company's Class B Common Stock at the conversion ratio of one share of
Series B Preferred Stock convertible into one share of Class B Common
Stock, upon payment of a conversion fee to the Company of $7.00 per
share, subject to adjustment. As of the Record Date, the Company had
not issued any shares of Class B Common Stock. The holders of the
Series B Preferred Stock were also entitled at any time between July
13, 1992 and August 12, 1992, to convert their shares of Series B
Preferred Stock into shares of the Class A Common Stock at the ratio
of one share of Class A Common Stock for each share of Series B
Preferred Stock without the payment of a conversion fee. A total of
420,909 shares of the Series B Preferred Stock were so converted into
shares of the Class A Common Stock during said period. Holders of the
Series B Preferred Stock are no longer entitled to convert their
shares into Class A Common Stock. SEE "PROPOSAL FOUR: AUTHORIZATION
OF AMENDMENTS AND RESTATEMENT OF CERTIFICATE OF INCORPORATION" FOR A
DISCUSSION OF THE PROPOSED RECLASSIFICATION OF CLASS B COMMON STOCK AS
AND INTO CLASS A COMMON STOCK

(3) Does not include 422 shares of Series B Preferred Stock held by the
ESOP. Mrs. Casey is a Co-Trustee under the ESOP. Each participant in
the ESOP may direct the Co-Trustees as to the manner in which shares
of Series B Preferred Stock allocated to his or her account shall be
voted. The ESOP provides that the Co-Trustees may vote shares of
Series B Preferred Stock allocated to participants' accounts as to
which they have not received voting instructions and shares of Series
B Preferred Stock held by the ESOP that are not allocated to
participants' accounts in accordance with instructions received from
the ESOP Committee. The ESOP Committee is composed of Mrs. Casey and
Linda M. Tanner, an officer of the Bank.

-9-
<PAGE> 16
SERIES C PREFERRED STOCK

The following table sets forth information concerning the beneficial
ownership of the Series C Preferred Stock as of March 24, 1994, which, as of
that date, was owned solely by the Principal Stockholder. Other than as set
forth below, and in the footnotes thereto, based on filings with the SEC, the
company is not aware of any person who is the beneficial owner of 5% or more of
the Series C Preferred Stock.

<TABLE>
<CAPTION>
NUMBER OF SHARES
OF SERIES C
PREFERRED STOCK PERCENT OF
BENEFICIAL OWNER (1) BENEFICIALLY OWNED (2) CLASS
------------------------------------------------------------------------------------------------
<S> <C> <C>
Putra Masagung 900,000 100

All directors, nominees and current executive 0 0
officers of the Company and the Bank as a group
(10 persons)
</TABLE>

- ----------------------

The address of Mr. Masagung is 55 Jalan MH Thamrin, Jakarta, Indonesia.

(2) If the stockholders approve PROPOSAL TWO, the holders of Series C
Preferred Stock will be entitled (and, as to shares outstanding on
April 29, 1994, required) to convert each share of Series C Preferred
Stock into 40 shares of Class A Common Stock and 40 Warrants. Each
Warrant entitles the holder to purchase an additional share of Class
A Common Stock at a purchase price of $0.50 per share. The preceding
sentences of this footnote do not give effect to the 1-for-10 reverse
stock split described in PROPOSAL FOUR.

SEE "PROPOSAL TWO: AUTHORIZATION OF CONVERSION OF SERIES C PREFERRED STOCK AND
AMENDMENT OF CERTIFICATE OF INCORPORATION TO INCREASE AUTHORIZED NUMBER OF
SHARES AND REQUIRE CONVERSION OF CERTAIN SHARES OF SERIES C PREFERRED STOCK."
SEE ALSO "CLASS A COMMON STOCK" FOR A DISCUSSION OF THE PROPOSED SALE OF SERIES
C PREFERRED STOCK BY THE PRINCIPAL STOCKHOLDER TO MR. LATIEF.

BACKGROUND INFORMATION

JULY 1992 INVESTMENT BY THE PRINCIPAL STOCKHOLDER

As a result of the Company's net losses suffered for the year ended
December 31, 1991 and the first six months of 1992, the Company and the Bank
failed to meet capital adequacy requirements applicable to bank holding
companies and banks through July 13, 1992. In order to raise additional
capital, on July 13, 1992, the Company completed the issuance and sale in a
private placement of 5,600,000 shares of its Class A Common Stock, which
represented a majority of the Company's total voting power, for $2.50 per
share, for an aggregate purchase price of $14,000,000, to the Principal
Stockholder, a private investor who is a citizen of Indonesia. The Principal
Stockholder also received the Anti-dilution Warrants to purchase up to
384,310 shares of Class A Common Stock at a purchase price of $2.50 per share
upon the exercise of options previously granted by the Company to its officers
and directors. In the two weeks preceding July 13, 1992, the average closing
price of the Class A Common Stock on the AMEX was $2.875. Due to the
expiration of the majority of the options granted by the Company to its
officers and directors prior to July 13, 1992, the maximum number of shares
that the Principal Stockholder can potentially acquire through the exercise of
Anti-dilution Warrants has been reduced to 102,207.

-10-
<PAGE> 17

The sale to the Principal Stockholder was accomplished pursuant to a
Stock Purchase Agreement, dated as of April 10, 1992, between the Company and
Peninsula Holdings, a corporation organized under the laws of the Cayman
Islands. The Stock Purchase Agreement had been assigned to the Principal
Stockholder on May 8, 1992 and had been amended on May 14 and June 18, 1992 (as
amended, the "Amended Stock Purchase Agreement"). The transactions
contemplated by the Amended Stock Purchase Agreement (the "Transactions"),
along with certain amendments to the Certificate which were necessary to
complete the Transactions, were approved by the Company's stockholders at a
Special Meeting of Stockholders held on July 6, 1992, following the mailing of
proper notice and a proxy solicitation conducted in accordance with SEC rules.

As a condition to closing the Transactions (the "Closing"), the
Principal Stockholder required the directors of the Company and the executive
officers and directors of the Bank to acquire 600,000 shares of the Class A
Common Stock at $2.50 per share (the same price per share as was paid by the
Principal Stockholder for his shares of the Class A Common Stock) in a private
placement which was made concurrently with the Closing, for an aggregate
purchase price of $1,500,000. Donald R. Stephens ("Stephens"), who at the time
was the Chairman of the Board, Chief Executive Officer and President of the
Company, expressed a willingness to invest up to $715,000 in the Company, and
other executive officers and directors of the Company and the Bank agreed to
invest the remaining $785,000. However, due to restrictions contained in the
Company's bylaws, Mr. Stephens could not acquire Class A Common Stock from the
Company at a price below the average closing price of the Class A Common Stock
in the twenty trading days prior to the purchase without the approval of the
holders of at least 50 percent of the Class A Common Stock. Such average
closing price in the twenty trading days prior to July 13, 1992 exceeded
$2.50.

In order to permit the Company to proceed with closing of the
Transactions without having to conduct a further proxy solicitation, the
Principal Stockholder agreed to waive the condition that the directors and
executive officers invest $1,500,000 in Class A Common Stock, provided that (a)
the officers and directors of the Company and the Bank other than Mr. Stephens
would invest $785,000 in Class A Common Stock by purchasing 314,000 shares from
the Company at $2.50 per share, and (b) Mr. Stephens would invest $715,000 in
the Company through the purchase at par of a non-interest bearing Subordinated
Term Note issued by the Company (the "Subordinated Term Note") in the principal
amount of $715,000. At the 1992 Annual Meeting of Stockholders held on
September 15, 1992, the stockholders of the Company approved the amendment of
the Company's bylaws and the issuance by the Company of 286,000 shares of Class
A Common Stock to Mr. Stephens in exchange for the cancellation of the
Subordinated Term Note, thereby effecting a sale of those shares to Stephens
for $2.50 per share.

The Amended Stock Purchase Agreement also called for the Company to
commence a private offering of additional Class A Common Stock to the Principal
Stockholder and to potential investors other than the executive officers and
directors of the Company and the Bank as soon as possible following completion
of the Transactions. The Company agreed to use its best efforts to raise up to
$10 million in the private offering, at the same price per share paid by the
Principal Stockholder in the Transactions, and to consummate the offering
within 60 days after its commencement.

NEED FOR ADDITIONAL CAPITAL IN FOURTH QUARTER OF 1992

As of July 13, 1992, following the completion of the Transactions, the
Company and the Bank were in compliance with all regulatory capital
requirements. As a result of $8 million of losses in the third quarter of
1992, however, the Company and the Bank again failed to meet certain regulatory
capital requirements as of September 30, 1992. If the Company and the Bank had
continued to fail to meet applicable capital requirements, they would have been
subject to a variety of possible regulatory restrictions and sanctions
including a termination of the Bank's ability to accept or "roll over" brokered
deposits (which would have severely affected the liquidity of the Bank), cease
and desist orders, civil monetary penalties on the institution and/or
management officials for violating safe and sound banking practices, removal of
officers or directors, temporary suspension or termination of the Bank's
deposit insurance, and possible seizure of the Bank by the

-11-
<PAGE> 18

FDIC followed by the liquidation or forced sale of the Bank. Management
initiated a program of immediate expense reductions, including the lay-off of
29 employees on September 29, 1992, the elimination of living allowances for
all executive officers, and the expansion of efforts to negotiate a reduction
in lease expenses. However, management forecast that, in addition to cost
reductions, at least $10 million of new capital would need to be raised in
order to attain compliance with regulatory requirements and to permit the Bank
to reduce its troubled assets. As a result, management and the Board of
Directors believed that it was critically important to the Company and the Bank
to raise a significant amount of additional capital in a very short time
period.

The Company prepared and distributed a private placement memorandum in
connection with the $10 million private offering contemplated by the Amended
Purchase Agreement, but was unable to identify any investors willing to
purchase shares of Class A Common Stock on the terms of the private offering,
and the Board of Directors terminated the offering on October 19, 1992. At the
same time, the Board authorized management to develop a new capital instrument
if necessary in order to attract new capital for the Bank, which instrument
would be offered to the Principal Stockholder, to the Company's directors and
executive officers, and to the potential investors who had executed
confidentiality agreements in connection with the private offering. In order
to raise the necessary capital quickly, and considering the lack of interest
from the other potential investors contacted in the private offering, the
Company entered into negotiations with the Principal Stockholder concerning
the terms and conditions on which he would agree to purchase additional
securities of the Company.

The Company and the Principal Stockholder would have preferred that a
new investment be made through the purchase and sale of additional shares of
Class A Common Stock. However, management believed that such a sale could not
be consummated as quickly as was necessary because of the Rules of the AMEX
(the "AMEX Rules"), on which the Class A Common Stock is traded. The AMEX
Rules require AMEX approval of an application for listing prior to the issuance
of any additional securities of a class listed on the AMEX. The AMEX Rules
further provide that, in order for AMEX to approve an application to list
additional common stock equal to or greater than twenty percent (20%) of the
then-outstanding stock, if the additional stock is to be sold for less than the
greater of the book or market value of the outstanding stock, stockholder
approval of the transaction must be obtained pursuant to a proxy solicitation
conforming to SEC proxy rules. If the transaction contemplated between the
Company and the Principal Stockholder had involved the issuance of Class A
Common Stock, it would have involved the issuance of common stock equal to more
than twenty percent (20%) of the then-outstanding common stock at a price less
than the book value per share and the market value per share of the Company's
Class A Common Stock.

Management of the Company believed that the process of calling a
special stockholders' meeting and preparing and circulating proxy materials
would have unacceptably delayed the necessary infusion of capital.
Consequently, the parties agreed upon a purchase and sale of convertible
preferred stock (the Series C Preferred Stock) and further agreed that the
conversion feature of that preferred stock (with each share of Series C
Preferred Stock convertible into 40 shares of Class A Common Stock and 40
Warrants to acquire an additional share of Class A Common Stock for $0.50 per
share) would be submitted to the stockholders of the Company for approval as
soon as practicable. Because the Series C Preferred Stock is not convertible
into Class A Common Stock unless and until stockholder approval of the
conversion feature has been obtained, the Series C Preferred Stock could be
issued without stockholder approval without violating the AMEX Rules. The
approval by the stockholders of the Company of the conversion feature of the
Series C Preferred Stock and certain related changes to the Certificate are
being sought at the Annual Meeting under PROPOSAL TWO.

OCTOBER 29TH LETTER AGREEMENT

Following a period of negotiations, the Company and the Principal
Stockholder entered into a letter agreement dated October 29, 1992, which was
subsequently amended on November 20, 1992 (as amended, the "October 29 Letter
Agreement") pursuant to which it was agreed that: (i) the Principal
Stockholder would purchase up to 500,000 shares of Series C Preferred Stock at
a price of Twenty Dollars ($20.00) per share for

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<PAGE> 19

a total purchase price of $10,000,000, subject to reduction by the number of
shares of Series C Preferred Stock, if any, issued and sold on the same terms
to executive officers and directors of the Company on or prior to the
completion of the sale to the Principal Stockholder, with the sale of 200,000
shares of Series C Preferred Stock to be completed by November 30, 1992, and
the sale of an additional 300,000 shares of Series C Preferred stock to be
completed by December 18, 1992; (ii) the Principal Stockholder would invest
an additional $2,000,000 in the Company through either (a) the purchase of
Class A Common Stock and/or warrants (or rights to subscribe for the same) in a
proposed offering by the Company of rights to purchase such Class A Common
Stock and/or warrants to the Company's existing stockholders and possibly
additional investors, or (b) the purchase of an additional 100,000 shares of
Series C Preferred Stock at a price of Twenty Dollars ($20.00) per share, with
the choice of (a) or (b) at the Company's option after discussion with the
Principal Stockholder; and (iii) the Company granted to the Principal
Stockholder an option (the "Series C Preferred Stock Option") to purchase up to
an additional 400,000 shares of Series C Preferred Stock at a price of Twenty
Dollars ($20.00) per share, exercisable in whole or in part at any time on or
before December 31, 1993. The terms and conditions set forth in the October 29
Letter Agreement were determined pursuant to an arm's length negotiation and
were approved by the unanimous vote of the Board of Directors of the Company.
The Principal Stockholder's obligations under the October 29 Letter Agreement
were not conditioned on the Company's initiation of a rights offering, but the
October 29 Letter Agreement contemplated that the Company would initiate a
rights offering designed to raise up to $8 million in capital, to be completed
by March 31, 1993.

The Principal Stockholder completed the purchase under the October 29
Letter Agreement of 200,000 shares of Series C Preferred Stock on November 30,
1992; purchased the second installment of 300,000 shares of Series C Preferred
Stock in separate acquisitions of 100,000 shares on December 30, 1992 and
200,000 shares on January 12, 1993; and, when the Company was unable to obtain
any indications of interest in the contemplated rights offering, completed the
investment of an additional $2,000,000 in the Company through a purchase of
100,000 shares of Series C Preferred Stock on February 26, 1993. Assuming
stockholder approval of the conversion feature of the Series C Preferred Stock,
which approval the Principal Stockholder can control through his ownership of
the majority of the voting stock of the Company, the effective price paid by
the Principal Stockholder per share of Class A Common Stock in each of the
above acquisitions was $0.50. In the two weeks preceding October 29, 1992, the
average closing price of the Class A Common Stock on the AMEX was $1.75; in the
two weeks preceding November 30, $1.19; in the two weeks preceding December 30,
$1.25; in the two weeks preceding January 12, 1993, $1.50, and in the two weeks
preceding February 26, $2.50.

DETERMINATIONS BY THE BOARD OF DIRECTORS

In approving the October 29 Letter Agreement, the Board of Directors
was influenced by the need to raise capital quickly. Based on discussions with
the FDIC by management and the Board, the Board believed that if the Bank did
not obtain a firm commitment for a substantial investment of capital within a
very short time period, the Bank would be subject to severe regulatory
sanctions, including the appointment of a receiver or conservator for the Bank,
that would have very negative consequences for the Company and possibly require
the Company to file a petition for bankruptcy. The Board, with assistance from
management and advice from the investment banking firm of Montgomery Securities
("Montgomery"), reviewed potential alternatives, including a private placement
of Class A Common Stock and a rights offering, but determined that the
Principal Stockholder constituted the only source from which the Company could
raise sufficient capital with the necessary promptness.

The Board of Directors considered the fact that the effective price
which the Principal Stockholder was paying for Class A Common Stock under the
October 29 Letter Agreement, assuming conversion of the Series C Preferred
Stock ($0.50) was below the trading price of the Class A Common Stock.
However, the Board of Directors believed that the only alternative to the
October 29 Letter Agreement was to accept regulatory sanctions which would
cause the value of the Class A Common Stock to fall below $0.50, including, in
the event of a conservatorship or receivership of the Bank, the likely need for
the Company to file bankruptcy, with its stock in such event likely becoming
worthless. In addition, the Board relied on advice from Montgomery as to the
fairness of the consideration to be paid by the Principal Stockholder.

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<PAGE> 20
FAIRNESS OPINION

On November 20, 1992, Montgomery delivered to the Board of Directors
of the Company a written opinion (the "Fairness Opinion") as to the fairness to
the stockholders of the Company (other than the Principal Stockholder and the
directors and executive officers of the Company and the Bank) from a financial
point of view, of the consideration to be received by the Company from the
Principal Stockholder in the transactions contemplated by the October 29 Letter
Agreement. The Fairness Opinion was based upon information available to
Montgomery as of the date the Fairness Opinion was issued. The full text of
the Fairness Opinion is attached hereto as Appendix A and should be read
carefully and in its entirety in connection with this Proxy Statement. The
following summary of Montgomery's opinion is qualified in its entirety by
reference to the full text of the opinion. Montgomery's opinion is addressed
to the Company's Board only and does not constitute a recommendation to any
Company stockholder as to how such stockholder should vote at the Annual
Meeting.

In connection with its opinion, Montgomery, among other things, (i)
reviewed certain publicly available financial and other data with respect to
the Company, including consolidated financial statements for recent years and
interim periods to the date of the Fairness Opinion and certain other relevant
financial and operating data relating to the Company made available to
Montgomery from published sources and from the internal records of the Company;
(ii) reviewed the October 29 Letter Agreement; (iii) reviewed the Certificate
of Designations of Rights, Preferences, Privileges and Restrictions of the
Series C Preferred Stock, as amended (the "Series C Certificate of
Designations"); (iv) reviewed certain historical market prices and trading
volumes of the Company's Class A Common Stock on the American Stock Exchange;
(v) as described in more detail below, compared the Company from a financial
point of view with certain other companies in the financial services industry
which it deemed relevant; (vi) as described in more detail below, considered
the financial terms, to the extent publicly available, of selected recent
transactions of financial institutions which it deemed to be comparable, in
whole or in part, to the transactions contemplated by the October 29 Letter
Agreement, (vii) reviewed and discussed with representatives of the management
of the Company certain information of a business and financial nature regarding
the Company, furnished to Montgomery by the Company's management, including
financial forecasts and related assumptions of the Company; (viii) made
inquiries regarding and discussed the October 29 Letter Agreement, the Series C
Certificate of Designations, the transactions contemplated by the October 29
Letter Agreement, and other matters related thereto with the Company and its
counsel and accountants; and (ix) performed such other analyses and
examinations as Montgomery deemed appropriate.

In connection with its review, Montgomery did not independently
verify any of the foregoing information, relied on such information and
assumed that all such information was complete and accurate in all material
respects. With respect to the financial forecasts for the Company provided to
Montgomery by the Company's management, Montgomery assumed that they were
reasonably prepared on bases reflecting the best available estimates and
judgments of the Company's management at the time of preparation as to the
Company's future financial performance and that they provided a reasonable
basis upon which Montgomery could form its opinion. Montgomery also assumed
there had been no material changes in the Company's assets, financial
condition, results of operations, business or prospects since the date of the
last financial statements made available to Montgomery. Montgomery relied on
advice of counsel to the Company as to all legal matters with respect to the
Company, the October 29 Letter Agreement, the transactions contemplated by the
October 29 Letter Agreement, and this Proxy Statement. In addition, Montgomery
did not make an independent evaluation, appraisal or physical inspection of the
assets or individual properties of the Company nor was it furnished with any
such appraisals. Further, Montgomery's opinion was based on economic,
monetary and market conditions existing as of the date of the Fairness Opinion.

In connection with rendering the Fairness Opinion, Montgomery
considered that the Bank was not in compliance with regulatory capital adequacy
requirements and, if the Bank was not able to raise adequate capital on a
timely basis, the Bank would face formal regulatory sanctions inhibiting its
ability to accept, renew

-14-
<PAGE> 21

or roll over brokered deposits on which the Bank was heavily dependent for its
liquidity. Montgomery also considered the likely possibility that a
conservator or receiver could be appointed for the Bank if the Bank was unable
to raise additional capital by December 19, 1992, the date certain provisions
of the prompt corrective action requirements of the Federal Deposit Insurance
Corporation Improvement Act of 1991 ("FDICIA") would become effective (the
FDICIA requirements are described below in "Prompt Corrective Action and
Capital Restoration Plan"). Given the short period of time that the Bank had
to raise additional capital, Montgomery also concluded that potential investors
or sources of new capital for the Bank other than Mr. Masagung were not
available.

In addition, Montgomery performed certain financial analyses, which
are summarized below. Although the evaluation of the fairness, from a financial
point of view, of the consideration to be paid in the transactions contemplated
by the October 29 Letter Agreement, was to some extent a subjective one based
on the experience and judgment of Montgomery, and not merely the result of
mathematical analysis of financial data, Montgomery relied on two financial
valuation methodologies in its determinations.

COMPARABLE COMPANY ANALYSIS. Using public and other available
information, Montgomery compared certain financial ratios of the Company
(including equity to assets, common equity to assets, return on average assets,
return on average equity, net interest margin, nonperforming assets to period
end loans, nonperforming assets to equity, loan loss reserve to loans, loan
loss reserve to nonperforming assets, chargeoffs to average loans, non-interest
expenses, net interest margin and non-interest expenses to average assets) as
of September 30, 1992, to other banks and bank holding companies which
Montgomery considered to be comparable. These banks and bank holding companies
are in some cases a subset of the largest 50 United States bank holding
companies ranked by assets, and in other cases a group of Western banks and
bank holding companies including TriCo Bancshares, Redwood Empire Bancorp,
Exchange Bank, Savings Bank of Mendocino County, RCB Corporation, First
Commercial Bancorp, Union Bank, Sumitomo Bank of California, The Pacific Bank,
Westamerica Bank, Mechanics Bank, Civic BanCorp, California Bancshares Inc.,
University National Bank, Silicon Valley Bancshares, Pacific Western
Bancshares, Pacific Capital Bancorp, MBC Corp. (Modesto Banking Company),
California Republic Bancorp, Mid-State Bank, Santa Barbara Bancorp, Levy
Bancorp, First State Bank of the Oaks, CU Bancorp, Foothill Independent Bank,
City National Bank, 1st Business Corporation, Guardian Bancorp, GBC Bancorp,
Santa Monica Bank, Home Interstate Bancorp, Pioneer Bancorp, Landmark Bancorp,
CVB Financial Corporation, Eldorado Bancorp, Riverside National Bank,
California Commercial, Commerce Bancorp, San Diego Financial Corp., Peninsula
Bank of San Diego, First National Corporation, CPB Inc., First Hawaiian, Inc.,
First Security Corp., and West One Bancorp.

No company reviewed in the analysis is identical to the Company or the
Bank. The analysis necessarily involved complex considerations and judgments
concerning differences in financial and operating characteristics of the
companies. Some of these commercial banking companies are included in
Montgomery's Quarterly Bank Monitor and Western Bank Monitor, respectively.

ANALYSIS OF SELECTED FINANCIAL INSTITUTION TRANSACTIONS. Montgomery
also compared the transactions contemplated by the October 2 Letter Agreement,
on the basis of the multiple of book value derived from the aggregate value of
the consideration involved in the transactions contemplated by the Agreement,
as of the date of determination of such consideration, with the same ratio in
recent acquisitions of bank holding companies which Montgomery deemed
comparable. In conducting this analysis Montgomery examined Western
transactions with multiples less than or equal to 100% of book value. Such
comparable acquisitions included: ValliCorp's acquisition of Pacific Bancorp,
HomeFed's acquisition of Antelope Valley Savings and Loan Association,
Peninsula Bank's acquisition of Citizen's Western Bank, Royal Trustco Limited's
acquisition of Pacific First Financial, Washington Mutual Savings Bank's
acquisition of Sound Savings & Loan and Mr. Masagung's July investment in the
Company.

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<PAGE> 22

The summary set forth above does not purport to be a complete
description of the analyses performed by Montgomery. The preparation of a
fairness opinion is not necessarily susceptible to partial analysis or summary
description. Montgomery believes that its analyses and the summary set forth
above must be considered as a whole and that selecting portions of its analyses
and of the factors considered, without considering all analyses and factors,
would create an incomplete view of the process underlying the analyses set
forth in its presentation to the Company's Board or of the process underlying
the Fairness Opinion. In addition, Montgomery may have given various analyses
more or less weight than other analyses, and may have deemed various
assumptions more or less probable than other assumptions, so that the results
from any particular analysis described above should not be taken to be
Montgomery's view of the actual value of the Company. The fact that any
specific analysis has been referred to in the summary above is not meant to
indicate that such analysis was given greater weight than any other analysis.

In performing its analyses, Montgomery made numerous assumptions with
respect to industry performance, general business and economic conditions,
actions which could be taken by bank regulators and other matters, many of
which were and are beyond the control of the Company. The analyses performed
by Montgomery are not necessarily indicative of actual values or actual future
results, which may be significantly more or less favorable than suggested by
such analyses. Such analyses were prepared solely as part of Montgomery's
analysis of the fairness of the transactions contemplated by the October 29
Letter Agreement to the Company's stockholders other than the Principal
Stockholder and the Company's and the Bank's directors and executive officers,
and were reported to the Company's Board in connection with the delivery of
Montgomery's opinion. The analyses do not purport to be appraisals or to
reflect the prices at which a company might actually be sold or the prices at
which any securities may trade at the present time or at any time in the
future. Montgomery used in its analyses various projections of future
performance prepared by the Company. Although as stated above Montgomery
assumed that these projections provided a reasonable basis upon which
Montgomery could form its opinion, the projections were based on numerous
variables and assumptions which are inherently unpredictable and must be
considered not certain of occurrence as projected. Accordingly, actual results
could vary significantly from those set forth in such projections.
Furthermore, the assumptions about bank regulatory actions are inherently
unpredictable and must be considered not certain of occurrence as assumed.
Accordingly, actual regulatory actions could have varied significantly from
those set forth above.

The Company's Board of Directors selected Montgomery to act as its
financial advisor in connection with the transactions contemplated by the
October 29 Letter Agreement, on the basis of Montgomery's expertise in such
matters and its prior relationship with the Company. The Company originally
engaged Montgomery in November 1991 as the Company's exclusive representative
and financial advisor for the purpose of identifying opportunities for
maximizing stockholder value, including advising the Company regarding
alternatives for raising additional capital. As part of its engagement,
Montgomery agreed to and did render a fairness opinion in June 1992 regarding
the Amended Stock Purchase Agreement. The Board of Directors of the Company
paid a fee of $278,740 to Montgomery in connection with this engagement. In
addition, Montgomery was paid a fee of $150,000 for rendering the Fairness
Opinion. The Company also agreed to reimburse Montgomery for its reasonable
out-of-pocket expenses in connection with its services to the Company. The
Company has retained Montgomery as one of its financial advisors for its
planned private placement described in more detail in PROPOSAL FIVE below.

ADDITIONAL INVESTMENT BY THE PRINCIPAL STOCKHOLDER

Upon completion by the Principal Stockholder on November 30, 1992 of
the first installment of the purchase of Series C Preferred Stock contemplated
by the October 29 Letter Agreement, the Company and the Bank were again in
compliance with then-applicable capital adequacy requirements. However,
because the Company and the Bank continued to incur losses during the fourth
quarter of 1992 and because the Principal Stockholder was not able to complete
the entire 300,000-share second installment of his investment commitment under
the October 29 Letter Agreement until January 12, 1993, the Company and the
Bank did not have

-16-
<PAGE> 23

sufficient capital to satisfy all applicable federal regulatory requirements on
December 31, 1992. Although the Company and the Bank believed that all minimum
capital requirements were satisfied as of February 26, 1993 upon completion by
the Principal Stockholder of the $2,000,000 third installment of his
investment commitment under the October 29 Letter Agreement, as a result of
continuing losses in the first half of 1993, the Bank did not satisfy all
minimum capital requirements as of March 31, 1993 and June 30, 1993. In order
to assist the Bank to attain compliance with minimum regulatory capital
requirements, and again facing the threat of regulatory action including the
appointment of a conservator or receiver, the Company determined to sell
additional shares of Series C Preferred Stock in a private placement.

The Company prepared a private placement memorandum for an offering
of up to $12 million of Series C Preferred Stock at the same price paid by the
Principal Stockholder under the October 29 Letter Agreement. The offering
would expire unless at least 300,000 shares of Series C Preferred Stock were
sold on or before June 30, 1993, subject to extension at the option of the
Company until September 30, 1993. The private placement memorandum was
distributed to accredited investors, and the Company obtained indications of
interest for a potential $10 million investment in the Company. However, when
the Company was unable to obtain a letter of intent from the potential
investor, the Company entered into negotiations with Mr. Masagung to encourage
Mr. Masagung to purchase additional shares of Series C Preferred Stock on the
terms indicated in the private placement memorandum.

Following a period of negotiations, including a review of the Bank's
loan portfolio by consultants retained by the Principal Stockholder, the
Principal Stockholder agreed to purchase an additional 300,000 shares of Series
C Preferred Stock for $6.0 million by no later than September 30, 1993 (the
"September Investment") under the Series C Preferred Stock Option and the
private placement memorandum. The Board of Directors unanimously authorized
the sale to the Principal Stockholder and extended the date for expiration of
the private placement to September 30, 1993. The September Investment was made
in two installments on August 27, 1993 and September 30, 1993, and the Bank
has returned to compliance with the industry-wide minimum regulatory capital
requirements. See the discussion below under the caption "Regulatory
Directives and Orders," however, with respect to compliance with orders issued
by the FDIC and the Banking Department. However, on August 29, 1993 the Bank
had become subject to higher capital requirements under orders issued by the
FDIC and the Banking Department and, as described below, is not currently in
compliance with such higher requirements. Assuming stockholder approval of the
conversion feature of the Series C Preferred Stock, which approval the
Principal Stockholder can control through his ownership of the majority of the
voting stock of the Company, the effective price paid by the Principal
Stockholder per share of Class A Common Stock in the September Investment was
$0.50. In the two weeks preceding August 27, 1993, the average closing price
of the Class A Common Stock on the AMEX was $1.40, and in the two weeks
preceding September 30 was $1.09.

REGULATORY DIRECTIVES AND ORDERS

FEDERAL RESERVE BOARD DIRECTIVE

As a result of the Federal Reserve Bank of San Francisco's (the "FRB")
examination of the Company as of June 30, 1991, the FRB on April 20, 1992
issued a letter (the "Directive") prohibiting the Company, without the FRB's
prior approval, from (i) paying any cash dividends to its stockholders, (ii)
incurring any new debt or increasing existing debt, (iii) repurchasing any
outstanding stock of the Company or (iv) acquiring or entering into an
agreement to acquire any entities or portfolios. The Company has been notified
that it is in a "troubled condition" for purposes of Section 914 of the
Financial Institutions Recovery, Reform and Enforcement Act ("FIRREA").
Accordingly, the Company must notify the FRB 30 days in advance of adding or
replacing any director or senior executive officer. All directors and officers
who have been submitted to the FRB for approval have been approved as the new
management team and additional directors have been identified for approval.

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<PAGE> 24

MEMORANDUM OF UNDERSTANDING

Pursuant to federal law, the Company is subject to the capital
guidelines of the Federal Reserve Board and the Bank is subject to the FDIC's
regulations governing capital adequacy for banks that are not members
("nonmember banks") of the Federal Reserve System. As a result of the Bank's
failure to meet its minimum capital requirements during 1991, on November 15,
1991 the Bank entered into a Memorandum of Understanding (the "MOU") with the
FDIC and the California State Banking Department (the "Banking Department").
The MOU required the Bank to restore its capital and its allowance for loan
losses to acceptable levels or to sell the Bank. In response to the MOU,
management of the Bank established and filed with the Banking Department and
the FDIC a capital plan to determine an appropriate range of capital ratios
within which the Bank could operate in a safe and sound manner, and to execute
the appropriate strategy to ensure that the Bank maintain capital within a
minimum desirable range. After certain interim actions, as a result of a
failure to meet regulatory capital requirements at March 31, 1993, the Bank was
required to file a Capital Restoration Plan (the "Restoration Plan") in
compliance with the "Prompt Corrective Action" system imposed by the Federal
Deposit Insurance Corporation Improvement Act of 1991 ("FDICIA"), and that plan
was approved by the FDIC on September 8, 1993. As a condition of the FDIC's
approval of the Restoration Plan, the Company agreed to guarantee that the Bank
will comply with the Restoration Plan until the Bank has met its minimum
capital requirements on average during each of four consecutive calendar
quarters. The Company's liability under the guarantee is limited to the lesser
of 5% of the Bank's total assets at the time it became undercapitalized, $15.3
million, or an amount necessary (or that would have been necessary) to bring
the Bank into compliance with all of its capital requirements as of the time it
fails to comply with the Restoration Plan.

CEASE AND DESIST ORDERS

On August 18, 1993, the Bank, without admitting or denying any alleged
charges, stipulated to Cease and Desist Orders (the "Orders") issued by the
FDIC and the Banking Department that became effective August 29, 1993 (the
"Orders Effective Date"), and that superseded the MOU. The Orders directed,
among other things, that the Bank: (a) achieve and maintain a 7% leverage
capital ratio on and after September 30, 1993; (b) pay no dividends without
the prior written consent of the FDIC and the California Superintendent of
Banks (the "Superintendent"); (c) reduce the $88.6 million in assets classified
"Substandard" or "Doubtful" as of November 30, 1992 (the date of the most
recent full-scope FDIC and Banking Department Report of Examination of the
Bank), to no more than $75.0 million by October 31, 1993, with further
reductions to no more than $60.0 million by December 31, 1993, no more than
$50.0 million by March 31, 1994 and no more than $40.0 million by August 31,
1994; (d) have and retain management whose qualifications and experience are
commensurate with their duties and responsibilities to operate the Bank in a
safe and sound manner, notify the FDIC and the Superintendent at least 30 days
prior to adding or replacing any new director or senior executive officer and
comply with certain restrictions in compensation of senior executive officers;
(e) maintain an adequate reserve for loan losses; (f) not extend additional
credit to, or for the benefit of, any borrower who had a previous loan from
the Bank that was charged off or classified "Loss" in whole or in part; (g)
develop and implement a plan to reduce its concentrations of construction and
development loans ; (h) not increase the amount of its brokered deposits above
the amount outstanding on the Orders Effective Date ($20.0 million) and submit
a written plan for eliminating reliance on brokered deposits; (i) revise or
adopt, and implement, certain plans and policies to reduce the Bank's
concentration of construction and land development loans, reduce the Bank's
dependency on brokered deposits and out of area deposits, and to improve
internal routines and controls; (j) reduce the Bank's volatile liability
dependency ratio to not more than 25% by December 31, 1993, and not more than
15% by March 31, 1994; (k) eliminate or correct all violations of law set out
in the most recent Report of Examination, and take all necessary steps to
ensure future compliance with all applicable laws and regulations; and (l)
establish a committee of three independent directors to monitor compliance with
the Orders and report to the FDIC and the Superintendent on a quarterly basis.

The following table reflects both the Company's and the Bank's
capital ratios at December 31, 1993 with respect to the industry-wide prompt
corrective action minimum capital requirements and the Orders. As

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<PAGE> 25

of December 31, 1993, the Bank met all industry-wide requirements but failed
to meet the 7% leverage capital ratio imposed by the Orders. This failure
occurred because the leverage ratio is calculated by dividing Tier 1 capital by
average assets at each month-end, and the Bank's primary action taken to meet
the required ratios during the fourth quarter -- the sale of its Sacramento
branch -- could not be effectuated until December 4, 1993 due to delays in the
approval by the FDIC and the Banking Department of such sale. If the sale of
the Sacramento branch had been effected in October 1993 (as planned by the
Bank) and the Bank's other operating results had remained the same, the Bank
leverage capital ratio for the fourth quarter would have been in excess of 7%.
In addition, at December 31, 1993 the Bank's Tier 1 capital divided by total
assets (without risk weighting) was 7.6%. Management believes that, in view of
the Bank's level of capital at December 31, 1993, receipt of the proceeds from
the Private Placement will permit the Bank to substantially exceed the 7%
leverage capital ratio requirement.

<TABLE>
<CAPTION>
Prompt Corrective Regulatory
Action Order
Company Bank Requirement Requirement
<S> <C> <C> <C> <C>
Leverage Ratio 6.7% 6.7% 4.00% 7.00%

Tier 1 Risk- 8.0% 8.0% 4.00% N.A.
Based Capital

Total Risk- 9.5% 9.5% 8.00% N.A.
Based Capital
</TABLE>

As to the other requirements of the Orders and the Restoration Plan,
the Bank believes that it is in compliance with each, with the exception of the
Banking Department's order requiring the Bank to correct its capital
impairment. See "-- Capital Impairment Orders." However, no outside
verification of such compliance has been performed, and the Bank's compliance
is subject to review by the FDIC and the Banking Department at their next
examination of the Bank began on February 28, 1994. No assurance can be given
that capital, in addition to that raised pursuant to the Private Placement, can
be raised if the Bank requires such additional capital to remain in compliance
with capital adequacy requirements or to pursue the new strategic focus of the
Bank and the Company. In addition, because of its asset qualify, operating
losses, volatile liability dependency and liquidity problems, the Bank is
potentially subject to further regulatory sanctions that are generally
applicable to banks that are not adequately capitalized.

In response to the Orders, management has submitted a business plan to
the FDIC and the Banking Department for approval. It is expected that the
business plan will be approved by the FDIC and the Banking Department after the
above-mentioned examination scheduled by both agencies which began on February
28, 1994 is substantially completed. Management believes that the Bank will be
able to take the actions contemplated by such plan without need for further
FDIC approval, subject to the general requirement that the Bank return to
profitability and be operated safely and soundly. A number of the restrictions
imposed by the Orders will remain in effect until the Orders are officially
lifted. Although management anticipates the FDIC and the Banking Department
will lift the Orders once the Bank's problem assets are fully resolved, no
assurance can be given as to when all conditions precedent to the lifting of
the Orders will be fulfilled. The Company also is subject to certain
restrictions imposed by the FRB pursuant to the Directives that may prevent the
Company from taking steps to establish new businesses (or new subsidiaries) at
the Company level until similar conditions precedent are fulfilled. However,
management believes that, initially, all new lines of business that the Company
plans to enter may be operated directly within the Bank.

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<PAGE> 26

CAPITAL IMPAIRMENT ORDERS

The California Financial Code (the "Financial Code") requires the
Superintendent to order any bank whose contributed capital is impaired to
correct such impairment within 60 days of the date of his or her order. Under
Section 134(b) of the Financial Code, the "contributed capital," defined as all
shareholders' equity other than retained earnings, of a bank is deemed to be
impaired whenever such bank has deficit retained earnings in an amount
exceeding 40% of such contributed capital. Under Section 662 of the Financial
Code, the Superintendent has the authority, in his or her discretion, to take
certain appropriate regulatory action with respect to a bank having impaired
contributed capital, including possible seizure of such bank's assets. A bank
that has deficit retained earnings may, subject to the approval of its
shareholders and of the Superintendent, readjust its accounts in a
quasi-reorganization, which may include eliminating its deficit retained
earnings, under Section 663 of the Financial Code. However, a bank that is not
able to effect such a quasi-reorganization or otherwise to correct an
impairment of its contributed capital within 60 days of an order to do so from
the Superintendent must levy and collect an assessment on its common shares
pursuant to Section 423 of the California Corporations Code.

A bank must levy such an assessment within 60 days of the
Superintendent's order; the assessment becomes a lien upon the share assessed
from the time of service or publication of such notice of assessment. Within
60 days of the date on which the assessment becomes delinquent, a bank subject
to the Superintendent's order must sell or cause to be sold to the highest
bidder for cash as many shares of each delinquent holder of the assessed shares
as may be necessary to pay the assessment and charges thereon.

As of December 31, 1993, the Bank had contributed capital of $49.2
million and deficit retained earnings of $31.8 million, or approximately 64.6%
of contributed capital, within the meaning of Section 134(b) of the Financial
Code. Thus, under Section 134(b) of the Financial Code, the Bank's contributed
capital was impaired as of that date in the approximate amount of $12.0
million. On November 6, 1992, February 17, 1993, November 16, 1993 and
February 7, 1994, the Superintendent issued orders to the Bank to correct the
impairment of its contributed capital within 60 days. The Bank has not
complied with these orders. As the sole shareholder of the Bank, the Company
(not the Company's stockholders) will receive any notices of assessment issued
by the Bank. The Bank is in violation of this California law requiring it to
assess the shares of the Bank (which are all held by the Company) in order to
correct the impairment of the bank's capital.

The Bank's capital impairment may be corrected through earnings, by
raising additional capital or by a quasi-reorganization, subject to the
approval of the Banking Department, in which the Bank's deficit retained
earnings would be reduced or eliminated by a corresponding reduction in the
Bank's contributed capital. The Bank is addressing the possibility of
obtaining approval of a quasi-reorganization with the Banking Department. If
the Banking Department refuses to grant permission for such a
quasi-reorganization, as of December 31, 1993, the Bank would have been
required to raise $30.2 million in new capital in order to correct its
impaired contributed capital (because the ratio of deficit retained earnings to
contributed capital may not exceed 40%, $2.50 of new capital must be raised for
every dollar or impairment). In response to the February 7, 1994 order
requiring the Bank to correct its impaired capital within 60 days, the Bank
notified the Banking Department in writing that it did not believe it will be
in a position to comply with the order within 60 days, and requested the
Banking Department's cooperation as the Company implements its plan for an
offering, and as the Company continues discussions with Banking Department
staff regarding a quasi-reorganization. It is the policy of the Superintendent
not to grant a quasi-reorganization unless a Bank can establish that (a) it has
adequate capital, (b) the problems that created past losses and the impairment
of capital have been corrected and (c) it is currently operating on a
profitable basis and will continue to do so in the future.

No assurance can be given that the Bank's capital condition will not
deteriorate further as a result of operating losses prior to a
quasi-reorganization. In addition, because a quasi-reorganization requires
that the Bank reduce its assets and liabilities to market value at the time of
the reorganization, the Bank's capital could be further reduced from its
present level as a result of such a reduction in the market value of the Bank's
assets

-20-
<PAGE> 27

over its liabilities. Finally, there can be no assurance that, following a
correction of the Bank's capital impairment, whether through a
quasi-reorganization or an infusion of sufficient capital, the Bank's capital
position will not continue to erode through future operating losses. As long
as the Bank's contributed capital is impaired, the Superintendent is
authorized to take possession of the property and business of the Bank, or to
order the Bank to comply with the legal requirement and levy an assessment on
the shares of the Bank held by the Company sufficient to correct the
impairment. As the Company is the sole shareholder of the Bank, the
assessment would be made on the Company. The Company does not have the funds
to satisfy such an assessment. Management believes, however, that the
Superintendent has never exercised his bank takeover powers under Section 134
solely on the basis that a bank's capital is impaired under the standards set
forth in Section 134.

In order to permit a quasi-reorganization of a bank's capital, the
Banking Department requires, among other things, that a bank demonstrate that
it is adequately capitalized and that it is capable of operating profitably.
Management believes, although it cannot assure, that the Bank will be able to
so demonstrate at such time as the Bank's problem assets are substantially
resolved, and that it will then be possible for the Bank to effect a
quasi-reorganization. Management also believes that, because it is anticipated
that the Bank will have high leverage and risk-based capital ratios after the
Private Placement, it is unlikely that the Superintendent would seek to take
action solely on the basis of impaired capital under the Section 134
definition. There can be no assurance, however, that other circumstances such
as insufficient liquidity or further operating issues could not arise that
would provide incentive to the Superintendent to utilize the powers granted by
Section 134.

PRIVATE PLACEMENT

The Company is attempting to raise additional capital in order to
obtain greater assurance that the Company and the Bank will be able to meet
their minimum capital requirements on an on-going basis in the coming months
and as a precaution against prolonged or increased uncertainty in the economy
in general and the real estate market in particular. In addition, the Company
is seeking to raise capital in order to initiate the Bank's new strategic focus
and permit management to pursue perceived opportunities both domestically and
in the Asian markets which is discussed in the Company's 1993 Annual Report.
The Company is seeking to raise net proceeds of a minimum of $15,000,000 and a
maximum of approximately $23,500,000 (if the entire allotment for
oversubscriptions is sold) in the Private Placement. Because of the regulatory
considerations discussed above, the Board of Directors of the Company believes
it is critical to the Company and the Bank to raise a substantial portion of
this additional capital as soon as possible.

The Company has retained Montgomery and NatWest Markets ("NatWest") as
Placement Agents (collectively, the "Placement Agents") to assist and advise the
Company with respect to the Company's capital raising efforts. The Bank has
also retained the Placement Agents as financial advisors. The Company has
prepared and is in the process of distributing a private placement memorandum
in connection with the Private Placement. As currently proposed, the Company
is offering to issue up to 7,222,222 units (the "Units"), each consisting of
(i) one share of its Class A Common Stock, (ii) one warrant, entitling the
holder thereof to purchase one share of Class A Common Stock at $5.00 per share
(the "Unit Warrants"), and (iii) one right, entitling the holder thereof to
receive, without payment of additional consideration, an amount of shares of
Class A Common Stock in periodic distributions based upon the resolution value
of certain problem assets currently held in the Bank's portfolio and the Bank's
expenses in administering and carrying such problem assets (the "Rights"). The
Company is offering the Units at a price of $3.60 per Unit (the "Unit Price").
The foregoing assumes the approval of Items 2, 3, and 4 at the Annual Meeting
and the resulting 1-for-10 reverse stock split. ASSUMING (I) THE SALE OF THE
MINIMUM NUMBER OF UNITS IN THE PRIVATE PLACEMENT, BUT (II) NO EXERCISE OF ANY
OF THE WARRANTS OR THE UNIT WARRANTS AND (III) NO SHARES ARE ISSUED PURSUANT TO
THE RIGHTS, THE SHARES ISSUED IN THE PRIVATE PLACEMENT WILL REPRESENT 51.0% OF
THE TOTAL NUMBER OF OUTSTANDING CLASS A COMMON STOCK AFTER THE PRIVATE
PLACEMENT. See "PROPOSAL FIVE: Authorization of Issuance of Additional Shares

-21-
<PAGE> 28

of Class A Common Stock, Warrants and Rights" for additional information
regarding the proposed terms of the Private Placement and the potential impact
on current holders of the Company's outstanding securities.

DETERMINATIONS BY THE BOARD OF DIRECTORS

In approving the terms of the Private Placement, the Board of
Directors was influenced by the need to raise capital quickly. The Board
believes that if the Bank does not obtain substantial investment of capital
within a very short time period, the Bank may be subject to regulatory actions
that could, among other things, severely restrict the Bank's ability to develop
new lines of business. Under such circumstances, the Board anticipates that it
would be necessary to reduce the Bank's deposit liabilities, accelerate plans
to reduce expenses (including personnel expenses) and continue to attempt to
dispose of problem assets on an orderly basis. Such reductions could adversely
affect the Company's and the Bank's ability to retain key management employees.
Although the Board believes that, under such circumstances, such a business
strategy would permit the Bank to continue in business and eventually to
resolve the problem assets, management cannot predict whether such a strategy
would cause such an erosion in the value of the Bank's business franchise that
it could appear prudent to seek a sale or merger with another bank. The Board
determined the proposed terms of the Private Placement with assistance from
management and advice from the Placement Agents.

The Board of Directors believes that an offering by the Company can
only be made at or near the current book value of the Company's Class A Common
Stock. Further, the Board believes that the offering must substantially
insulate new investors from the potential effects of the Company's "problem"
assets. The Rights were developed as a mechanism to address this requirement.
Likewise, the Board believes it necessary to market the Units to offer new
investors warrants on the same terms as are currently held by the Principal
Stockholder.

Certain potential institutional investors in the Units in the United
States have indicated to the Company that, for several reasons the
attractiveness to them of the Units as a potential investment would be enhanced
if the Warrants were not included. Among other things, such investors have
indicated to the Company that they are concerned that, for purposes of the
ownership thresholds of the United States Change in Bank Control Act of 1987
("CBC Act"), the FRB may consider shares of Class A Common Stock that could be
acquired upon exercise of the Warrants by an investor to be outstanding before
any particular investor's Warrants were exercised, but not consider shares
underlying unexercised Warrants held by other investors to be outstanding at
the same time for purposes of computing the then total shares outstanding. As
a result, the FRB might deem the CBC Act ownership thresholds to be breached
(without prior regulatory approval being obtained) by the purchase of fewer
Units than would otherwise be the case. This could require such an investor to
make a smaller investment than it would find otherwise attractive, or to engage
in discussions with the FRB to interpret the CBC Act thresholds (which in this
regard may be subject to FRB interpretive discretion) that might give rise to
unacceptable delays to the Company. Similar concerns could arise also on the
part of non-U.S. investors.

In light of such concerns, Management has discussed with Mr. Masagung
the possibility of amending the terms of the Series C Preferred Stock to
eliminate the issuance of Warrants when the Series C Preferred Stock is
converted following the Annual Meeting. If Mr. Masagung (and, if he so
requires, his potential transferees) agrees to such an elimination, it would no
longer be necessary to issue Warrants in the Private Placement in order to
equalize the interests of the investors in the Private Placement and Mr.
Masagung (or their respective transferees) in the Company. In such
circumstances, the Company would expect to seek the consent of investors in the
Private Placement also to not require the issuance of Warrants as a component
of the Units.

The Board of Directors considered the fact that the effective price
per share of Class A Common Stock is expected to be upon issuance substantially
below the trading price of the Class A Common Stock. However, the Board of
Directors believes that the Company will be unable to raise sufficient capital
on more favorable terms and that the alternative of regulatory sanctions (or
actions to forestall such sanctions) would cause the value of the Class A
Common Stock to fall below the effective offering price, including, in the
event of a

-22-
<PAGE> 29

conservatorship or receivership of the Bank, the likely need for the Company to
file bankruptcy, with its stock in such event likely becoming worthless.

The Company's Board of Directors selected the Placement Agents on the
basis of their expertise in such matters and, in the case of Montgomery, its
prior relationship with the Company. The Company and the Bank have entered
into an Engagement Letter (the "Engagement Letter") and an Advisory Agreement
(the "Advisory Agreement"), respectively, with the Placement Agents. The
Engagement Letter provides that the Placement Agents will act as placement
agents on a "best efforts" basis in connection with the Private Placement. In
such capacity, the Placement Agents will receive selling commissions from the
Company equal to 7% of the aggregate price to investors to whom Units are sold
(the "Selling Commission"), including sales to any entities affiliated or
associated with either Placement Agent, payable on the closing date to which
the sales relate. The Placement Agents are authorized to re-allow a portion of
the selling commission to selected dealers. The Advisory Agreement provides
that the Placement Agents will furnish advisory services with respect to the
Bank's capital adequacy and risk-sharing criteria for the troubled asset
portfolio. The Bank has agreed to compensate the Placement Agents for such
advisory services in an aggregate amount of $100,000, payable in installments
of $50,000 upon execution of the Advisory Agreement and $50,000 on April 1,
1994, provided that such $100,000 fee is to be credited against the Selling
Commission. Each of the Engagement Letter and the Advisory Agreement also
provide that the Company and the Bank will reimburse the Placement Agents for
up to $25,000 of expenses incurred in connection with the Private Placement and
the furnishing of the advisory services. The Engagement Letter and the
Advisory Agreement further provide that the Bank and the Company will indemnify
the Placement Agents and their affiliates against certain liabilities that
relate to or arise out of the Engagement Letter or the Advisory Agreement.

POSSIBLE ADDITIONAL SALES OF SECURITIES

Mr. Putra Masagung has indicated to management of the Company that he
is considering the possible further investment of $1,000,000 in the Company by
the purchase of Units in the Private Placement. Mr. Oka Masagung has indicated
to management of the Company that he intends to subscribe for up to $2,000,000
of Units in the Private Placement.

The Bank currently leases space for its business operations in a
building located at 550 Montgomery Street, San Francisco, California (the
"Property") from the Bank of San Francisco Building Company, a California
limited partnership (the "Building Partnership"). The Partnership was formed
in 1987 to hold a leasehold interest in the Property and raised capital by
means of a private placement of 100 units of Limited Partnership Interest,
originally valued at $50,000 per interest ("Building Units"). Bank of San
Francisco Realty Investors, a California corporation ("BSFRI") and a
wholly-owned subsidiary of the Bank, is a general partner of the Partnership
and in such capacity holds two Building Units. The Bank is also a limited
partner of the Partnership and in such capacity holds 28 Building Units. The
remaining Building Units are held by various individuals.

The Bank and the Company contemplate making an offer to the limited
partners of the Building Partnership to purchase the Building Units held by
them. The Company currently contemplates that such offer to the limited
partners would be composed of two parts. First, each person who is an
"accredited investor" (as defined in Regulation D under the Securities and
Exchange Act of 1934 as amended) would be able to exchange each of his or her
Building Units for (i) Units having a value (based upon the amount paid by
investors in the Private Placement) of a minimum of $18,334 and (ii) a maximum
of $33,333 in cash. Such person could elect to take more than $18,334 in Units
(so valued) and correspondingly less cash. Each limited partner who is not an
accredited investor would be able to exchange his or her Building Units for
$50,000 in cash per Building Unit. Representatives of the Company have had
discussions regarding such an offer with a holder of approximately 13.5% of the
Building Units and believe that he would accept such an offer if made. The
Bank and the Company believe that further discussion regarding this offer will
continue in the future. Any such offering for the Building Units will be
subject to the approval of the FDIC and the Superintendent, which

-23-
<PAGE> 30

approvals are being sought. If such an offer is successful, the Bank hopes to
be able to renegotiate its lease for the Building, which, the Bank believes,
calls for payment of rent above the current lease market. There can be no
assurance, however, that if made, the offering for the Building Units will be
successful or that subsequent lease renegotiations will succeed in materially
diminishing the Bank's lease liabilities.

PROPOSAL ONE: ELECTION OF DIRECTORS

DIRECTORS AND NOMINEES

The bylaws of the Company provide a procedure for nomination for
election of members of the Board of Directors, which procedure is printed in
full in the Notice of Annual Meeting of Stockholders accompanying this Proxy
Statement. If a nomination is not made in accordance with the procedures set
forth in the Notice of Annual Meeting of Stockholders, the Chairman of the
Annual Meeting may, if the facts warrant, determine and declare at the Annual
Meeting that a nomination was not made in accordance with the procedures set
forth in the bylaws and direct that the defective nomination be disregarded.

The bylaws of the Company currently provide that the number of
directors of the Company is subject to adjustment by resolution of the Board of
Directors, and the Board of Directors have adopted a resolution setting the
number of directors at nine (9). Pursuant to the reincorporation of the
Company in Delaware in 1988, the Board of Directors is divided into three
classes (Class I, Class II and Class III). The bylaws prescribe that the three
classes shall be as nearly equal in number as possible. Accordingly, Classes
I, II and III are each comprised of three (3) directors. Each director serves
for a term ending on the date of the third annual meeting of the stockholders
following the annual meeting at which the director was elected. The Class I
directors are currently serving and will serve until the 1995 annual meeting of
stockholders; the Class II directors are currently serving until the Annual
Meeting and the Class II directors elected at the Annual Meeting will serve
until the 1996 annual meeting of stockholders; and the Class III directors are
currently serving until the Annual Meeting and the Class III directors elected
at the Annual Meeting will serve until the 1997 annual meeting of stockholders.
Notwithstanding the above, each director serves pursuant to the bylaws until
his successor is duly elected and qualified or until his death, resignation or
removal.

The Board has nominated Mr. Carl D. Gustavson, who is currently
serving as a Class III director, for election as a Class II director. If Mr.
Gustavson is elected as a Class II director, there will exist one vacancy in
Class III on the Board of Directors that will remain
vacant after the election of directors pursuant to this PROPOSAL ONE.

Management expects to recommend that the Board increase the number of
authorized directors to twelve (12), and to continue to identify additional
persons to serve on the Board of Directors, subject to approval by the Board
and non-objection by the FRB, FDIC and the Banking Department. Mr. Putra
Masagung, the Company's principal stockholder, has indicated that he wishes to
serve on the Board of Directors of the Company (but not the Bank). Subject to
non-objection by the FRB, FDIC and the Banking Department, it is expected that
Mr. Masagung will be appointed to the Board. Mr. Masagung agreed to and did
support the appointment of Messrs. Price and Champion as, respectively,
Chairman of the Board and Vice Chairman of the Board, and the employment
agreements negotiated by Messrs. Price and Champion with the Bank, which
provide for such appointments. Mr. Rodney D. Freed, a director of the Company,
served as Executive Director of Tigamas Holdings, Pte. Ltd., a Singapore based
investment company, from 1991 to 1993. See the description of Mr. Freed's
principal occupations during the last five years under "Class III Directors"
below. Mr. Freed's responsibilities as Executive Director of Tigamas Holdings,
Pte., Ltd. during 1993 included the management of Mr. Masagung's investments in
the Company, and monitoring of the investment through Mr. Freed's role as a
director of the Company and the Bank. Other than such agreements, there were
no arrangements or understandings pursuant to which the persons listed above
were selected as directors or nominees for director.

-24-
<PAGE> 31

Mr. Kaharudin Latief of Jakarta, Indonesia, has provided notice to the
FRB and applied to the Banking Department for approval to acquire shares of
Class A Common Stock. If and when regulatory clearance is received, Mr. Latief
plans to acquire from Mr. Masagung 300,000 shares of Series C Preferred Stock
(or, assuming that PROPOSAL TWO is approved, the shares of Class A Common Stock
and Warrants into which such shares of Series C Preferred Stock are converted)
through cancellation of an unsecured, personal loan in the amount of $6,000,000
which Mr. Latief previously extended to Mr. Masagung. Mr. Masagung used the
proceeds of this loan to acquire 300,000 shares of Series C Preferred Stock
from the Company. If Mr. Latief consummates this transaction, and if the
conversion feature of the Series C Preferred Stock (including mandatory
conversion on April 29, 1994) is approved by the Company's stockholders, Mr.
Latief would hold 12,000,000 shares of Class A Common Stock and Warrants to
acquire an additional 12,000,000 shares of Class A Common Stock at an exercise
price of $0.50 per share. Mr. Latief has indicated that if he acquires the
Company's capital stock from Mr. Masagung as presently contemplated, he will
seek appointment of himself or his designee as a director of the Company (but
not the Bank), subject to obtaining required regulatory non-objection.
Management of the Company expects to recommend to the Board of Directors that
Mr. Latief or his designee be added to the Board if his acquisition is
completed, subject to regulatory clearance and the expansion of the Board of
Directors. Management of the Company has also identified an additional person
who has indicated his willingness to serve as a director of the Company (but
not the Bank). This person has not been chosen by the Board to fill any
vacancy, but his name has been submitted to the FRB, FDIC and the Banking
Department for review as a potential director, as required by statute and the
terms of the Regulatory Orders. If the FRB, FDIC and the Banking Department do
not indicate any objection to the service of this person as a director,
management would recommend to the Board that this person be chosen to fill the
expected vacancy on the Board of Directors.

The Board has had significant turnover since the 1992 Annual Meeting
of Stockholders, at which time the Bylaws of the Company provided for fourteen
directors and there were ten directors serving on the Board. Of those ten
directors, Messrs. John V. Diepenbrock, Donald R. Stephens, Thayer T.
Prentice, Timothy J. Parrott, William J. Rosetti and W. Howard Lester have
resigned from the Board for personal reasons and to facilitate the transition
to new management of the Company and the Bank.

CLASS II DIRECTORS. Three (3) Class II directors are to be elected at
the Company's 1994 Annual Meeting of Stockholders, each to hold office until
the Company's 1996 annual meeting of stockholders and until his respective
successor is duly elected and qualified, or until his death, resignation or
removal. The nominees for election as a Class II Director are Messrs. Kent D.
Price, Steven R. Champion and Carl D. Gustavson. Messrs. Price and Champion
are currently serving as Class II directors, and Mr. Gustavson is currently
serving as a Class III director. The following table sets forth as to each
nominee for election as a Class II director of the Company, such person's age,
principal occupations during at least the last five years, and the period
during which such person has served as a director of the Company.

Mr. Price served as Chief Financial Officer and Executive Vice
President of Bank of New England Corporation from May 1990 to January 1991. Mr
Price was asked to join Bank of New England Corporation as part of a new
management team charged with improving the condition of the troubled company.
Despite the new management's efforts, Bank of New England Corporation filed a
petition for liquidation under Chapter 7 of the federal Bankruptcy Code on
January 7, 1991 following the appointment of the FDIC as receiver for its
subsidiary banks. The Board believes that the bankruptcy of Bank of New
England Corporation is immaterial to Mr. Price's ability to serve as a director
of the Company.

-25-
<PAGE> 32
<TABLE>
<CAPTION>

DIRECTOR OF
THE COMPANY
NAME OF CLASS II DIRECTOR OR NOMINEE AND AGE AT (AND DIRECTOR
PRINCIPAL OCCUPATION FOR LAST DECEMBER 31, OF THE BANK)
FIVE YEARS 1993 SINCE
- ----------------------------------------------------------------------------------------------------
<S> <C> <C>

KENT D. PRICE . . . . . . . . . . . . . . . . . . . . . . . . . . 50 1993

Mr. Price has served as Chairman and Chief Executive (1993)
Officer of the Company and the Bank since September 1993.
He served as Executive Vice President, Private Banking
and Corporate Development of Bank of America from 1991 to
1993; Chief Financial Officer and Executive Vice
President of Bank of New England Corporation from 1990 to
1991; Chief Operating Officer, Chief Financial Officer
and Director of Barr Rosenberg Investment Management in
1990; and Deputy Chairman and Chief Executive Officer of
Chloride Group PLC in London from 1986 to 1989.

STEVEN R. CHAMPION 48 1993

Mr. Champion has served as Vice Chairman and Chief (1993)
Financial Officer of the Company and the Bank, and Chief
Investment Officer of the Bank, since August 1993. He
served as Chief International Investment Officer of Bank
of America from 1992 to 1993, President and Chief
Executive Officer of the R.O.C.-Taiwan Fund from 1989 to
1992, and President and Chief Executive Officer of
International Investment Trust Company in Taipei, Taiwan
from 1987 to 1992.

CARL D. GUSTAVSON 52 1993

Mr. Gustavson served as Chairman of the Board of Jackson (1993)
County Federal Bank, FSB in Medford, Oregon from
December 1988 until its merger into Key Bank of Oregon on
December 31, 1993, and is the principal of Carl D.
Gustavson & Associates, an investment and consulting
firm. From 1983 to 1988, Mr. Gustavson was Chairman,
President and Chief Executive Officer of Hibernia
Bancshares Corporation and Hibernia Bank, both of San
Francisco.
</TABLE>

CLASS III DIRECTORS. Two (2) Class III directors are to be elected
at the Company's 1994 Annual Meeting of Stockholders, each to hold office until
the Company's 1997 annual meeting of stockholders and until his respective
successor is duly elected and qualified, or until his death, resignation or
removal. The nominees for election as a Class III director are Messrs. Rodney
D. Freed and Willard D. Sharpe who are currently serving as Class III
directors. The following table sets forth as to each nominee for election as
a Class III director of the Company, such person's age, principal occupations
during at least the last five years, and the period during which such person
has served as a director of the Company. Mr. Freed's responsibilities as
Executive Director of Tigamas Holdings, Pte., Ltd. during 1993 included the
management of the Principal Stockholder's investments in the Company, and
monitoring of the investment through Mr. Freed's role as a director of the
Company and the Bank. Other than Mr. Freed's arrangement with Tigamas
Holdings, there were no arrangements or understandings pursuant to which the
persons listed below were selected as directors or nominees for director.

-26-
<PAGE> 33
<TABLE>
<CAPTION>
DIRECTOR OF
THE COMPANY
NAME OF CLASS III DIRECTOR OR NOMINEE AND AGE AT (AND DIRECTOR
PRINCIPAL OCCUPATION FOR LAST DECEMBER 31, OF THE BANK)
FIVE YEARS 1993 SINCE
- ------------------------------------------------------------------------------------------------------
<S> <C> <C>

RODNEY D. FREED . . . . . . . . . . . . . . . . . . . . . . . . . 50 1992

Mr. Freed has served as President of the Company since (1992)
February 1993, President of the Bank since September
1993, and served as Chairman and Chief Executive Officer
of the Company between February 1993 and September 1993.
Mr. Freed has served as Senior Investment Manager of the
Gunung Agung Group, an Indonesian multinational
conglomerate, from November 1990 through December 1992.
Mr. Freed served as Singapore Country Manager for The
Chase Manhattan Bank, N.A. from 1987 to 1990, and as
Taiwan Country Manager from 1982 to 1987. Mr. Freed
served as Executive Director of Tigamas Holdings, Pte.
Ltd., a Singapore based investment Company from 1991 to
1993, and as a director of Aerodyne International Pte.
Ltd., a Singapore manufacturer of precision machine parts
from 1991 to 1993.

WILLARD D. SHARPE . . . . . . . . . . . . . . . . . . . . . . . . 70 1993

Mr. Sharpe is a retired economist who, at the time of his (1993)
retirement in 1987, served as a Vice President of Chase
Manhattan Bank and as the Bank's chief economist for
Asia.
</TABLE>

CLASS I DIRECTORS. The following table sets forth as to each Class I
director of the Company, such person's age, principal occupations during at
least the last five years, and the period during which such person has served
as a director of the Company.

-27-
<PAGE> 34
<TABLE>
<CAPTION>
Director of
the Company
Name of Class I Director or Nominee and Age at (and Director
Principal Occupation for Last December 31, of the Bank)
Five Years 1993 Since
- -----------------------------------------------------------------------------------------------------
<S> <C> <C>

DONNA MILLER CASEY . . . . . . . . . . . . . . . . . . . . . . . 44 1981

Mrs. Casey served as a partner of Loder & Associates, a (1978)
special events, marketing and promotion firm, from May
1991 to June 1993, and as Executive Director of San
Francisco Beautiful, a non-profit organization dedicated
to civic beautification, from 1987 to 1989. Mrs. Casey
served as Secretary of the Company from its organization
in 1981 until 1992. She served as Secretary of the Bank
from its organization in 1978 until 1992. Mrs. Casey has
served as a director of Compensation Resource Group, Inc.
since 1990, a Trustee of University of San Francisco
since 1984, and a Trustee of the California State Summer
School for the Arts since 1983.

DAVID R. HOLBROOKE, M.D. . . . . . . . . . . . . . . . . . . . 52 1981

Dr. Holbrooke has served as Chief Executive Officer of (1978)
Holbrooke & Associates, a health care investment and
management firm, since 1985. He has served as a director
of TriCare, Inc., a health care services company, since
1985. Dr. Holbrooke is a principal and director of a
number of privately held firms in the health care field.

GORDON B. SWANSON . . . . . . . . . . . . . . . . . . . . . . . . 49 1985

Mr. Swanson is President of G.B. Swanson & Co., a real (1985)
estate advisory firm. Mr. Swanson has served as a
Director Emeritus of the San Francisco Chamber of
Commerce since 1986. Mr. Swanson served as Managing
Director of Jones Lang Wootton U.S.A., a commercial real
estate investment company, from 1989 to 1991, and as Vice
President of Goldman Sachs from 1986 to 1989.
</TABLE>

===============================================================================

EXECUTIVE OFFICERS

The following table sets forth as to each person who currently serves
as an executive officer of the Company or the Bank, such person's age, such
person's principal occupations during the past five years, such person's
current position with the Company or the Bank, and the period during which the
person has served in such position. Virtually all of the executive officers
have joined the Company and the Bank within the past year, as a result of the
changes in ownership of the Company and the reorientation of the Company to
focus on private banking, investment management and trust services in the San
Francisco Bay Area, the West Coast and the Pacific Basin.

-28-
<PAGE> 35
<TABLE>
<CAPTION>
Position with the Company or
Age at the Bank and Principal
December 31, Occupations During the
Officer 1993 Past Five Years
- ----------------------------------------------------------------------------------------------------
<S> <C> <C>
Kent D. Price 50 (Please see the description of Mr. Price's
positions with the Company and the Bank and
background under the heading "Directors").

Rodney D. Freed 50 (Please see the description of Mr. Freed's
positions with the Company and the Bank and
background under the heading "Directors").

Steven R. Champion 48 (Please see the description of Mr. Champion's
positions with the Company and the Bank and
background under the heading "Directors").

C. William Criss, Jr. 51 Executive Vice President Senior Credit Officer
since August 1993. Executive Vice President,
specialAssets since 1992. A Principal of
Wright Houlihan & Associates in 1992. President
and Chief Executive Officer of East West
Financial Group and East West Bank, N.A. from
1989 to 1991. Vice President and General
Manager of Chase Bank International from 1981 to
1989.

Stephen V. R. Spaulding 56 Senior Vice President of the Bank and Managing
Director of Private and Business Banking since
1993. President of Chase Manhattan Trust
Company of California from 1992 to 1993,
Senior Vice President and Manager, United States
Private Banking Division of Bank of America,
from 1984 to 1992.
=====================================================================================================
</TABLE>

Each executive officer is selected annually by the Board of Directors
pursuant to provisions of the Bylaws of the Company and the Bank. The
Principal Stockholder has agreed to transfer to each of Messrs. Price and
Champion Warrants to purchase 1.5 million shares of Class A Common Stock with
an exercise price of $0.50 per share (without giving effect to the 1-for-10
reverse stock split described in PROPOSAL FOUR), upon conversion of the
Company's Series C Preferred Stock and upon the successful completion of the
Private Placement. In addition, the Principal Stockholder advanced Mr. Price
$250,000 in consideration of Mr. Price's agreement to develop a strategic plan
for the Company and the Bank prior to regulatory non-objection of Mr. Price's
employment agreement, with such advance to be repaid upon Mr. Price realizing
the benefit of the Warrants which the Principal Stockholder has agreed to grant
to Mr. Price. Other than the foregoing arrangements and the Price and Champion
employment agreements described in "Employment Contracts and Termination of
Employment and Change-in-Control Arrangements" below, there were no
arrangements or understandings pursuant to which the persons listed above were
selected as executive officers.

Except for the Bank, none of the corporations or organizations
discussedin the above table is an affiliate of the Company. No director,
nominee for director or executive officer of the Company or the Bank has any
family relationship with any other director or executive officer of the Company
or director or executive officer of the Bank.

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<PAGE> 36
Except as stated above, no director of the Company is a director of
any company with a Class of securities registered pursuant to section 12 of the
Securities Exchange Act of 1934, as amended, or subject to the requirements of
section 15(d) of such Act or of any company registered as an investment company
under the Investment Company Act of 1940, as amended.

COMMITTEES OF THE BOARDS OF DIRECTORS

The Company's Board of Directors held fourteen (14) meetings during
1993 and acted on numerous items by unanimous written consent.

The Company and the Bank thoroughly reorganized their committee
structures in October 1993. The following sets forth information with respect
to the committees of the Company's and the Bank's Board of Directors following
such revisions. The current Committee membership will be expanded if and when
additional directors join the Boards of the Company and the Bank. The
Company's Board of Directors presently does not have a standing nominating
committee.

CURRENT COMMITTEES

The Bank Executive Committee presently includes directors
Price, Gustavson, Holbrooke, and Swanson. The Executive Committee
may exercise all of the authority of the Board of Directors in the
management of the business of the Bank in the interim between
meetings of the Board of Directors, except with respect to the filling
of vacancies on the Board, the fixing of compensation of directors,
the amendment of the by-laws, distributions to stockholders, the
appointment of committees of the Board, and any action which by law
requires Board or stockholder approval.

The Company Personnel/Compensation Committee presently
includes directors Casey, Gustavson, Sharpe and one non-director
executive officer. This Committee establishes philosophy and strategy
regarding human resources. It reviews and approves personnel policy
and significant benefit programs. It also reviews and approves
executive compensation and employment contracts and conducts an annual
review of the Bank's overall compensation and benefit programs. This
Committee also is responsible for recommending to the entire Board the
granting of employee stock options.

The Bank Examining (Audit) Committee presently includes
non-employee directors Gustavson, Sharpe, Swanson, Holbrooke and
Casey. Mr. Champion serves as an advisor to the Committee. This
Committee evaluates Bank performance and progress of the organization
with respect to its business and profit plans, annual operating budget
and operating results against plans. It also initiates suitable audit
examinations of the Bank's internal controls to preserve the Bank's
assets, and reviews periodic reports from outside auditors.

The Bank Loan and Discount Committee presently includes
directors Champion, Holbrooke, Swanson, Freed, Gustavson, Price and
one non-director executive officer. This Committee reviews and
approves the Bank's loan policies. The Committee has the ability to
delegate certain lending authority to the President. It examines and
approves loans above a specified size, and conducts regular reviews of
the entire loan portfolio and annual reviews of management's
compliance with Community Reinvestment Act regulations.

The Company Investment Committee presently includes directors
Champion, Price, Sharpe and Swanson, and two non-director officers.
This Committee establishes strategies and policies regarding
productive use of excess funds and prudent investments consistent with
regulatory and liquidity requirements.

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<PAGE> 37

The Company Special Assets Steering Committee presently
includes directors Price, Holbrooke, Swanson, Freed and two
non-director executive officers. This Committee is responsible for
supervising activities of the Bank's Special Assets Department, which
administers all of the Bank's nonperforming assets and all performing
assets classified substandard or below.

The Bank's Regulatory Committee presently includes directors
Swanson, Champion, Holbrooke, Freed, Price and three non-director
officers. This Committee is responsible for reviewing management's
progress toward meeting and resolving all conditions contained in the
Regulatory Orders.

The Bank's Trust Committee and Trust Investment Committee
presently includes directors Holbrooke, Champion, Sharpe, Price and
four non-director officers. The Committee oversees the Bank's trust
operations, and reviews and establishes policies and procedures for
such operations, including policies on trust department investments.

The Company's 401(k), ESOP and ESPP Committee presently
includes directors Casey and Sharpe and two non-director senior
officers. This committee is responsible for the management and the
administration of these ERISA plans.

COMPENSATION OF DIRECTORS

The Board of Directors of the Company indefinitely suspended the
payment of all directors' fees in the fourth quarter of 1992. It is currently
intended that director fees will be re-instated subject to regulatory
considerations. Mr. Freed's responsibilities as Executive Director of Tigamas
Holdings, Pte., Ltd. during 1993 included among other things the management of
the Principal Stockholder's investment in the Company, and monitoring of the
investment through Mr. Freed's role as a director of the Company and the Bank.

EXECUTIVE COMPENSATION

Decisions on the compensation of the Company's and the Bank's
executives are generally made by the four-member Personnel/Compensation
Committee. Three members of the Personnel/Compensation Committee are members
of the Board of Directors of the Company; the fourth member of the
Personnel/Compensation Committee is the Director of Human Resources of the
Bank, who is not a member of the Board of Directors. All decisions by the
Personnel/Compensation Committee relating to the compensation of the Company's
and the Bank's executive officers are reviewed by the Company's and the Bank's
full Boards of Directors, except for decisions about awards under certain of
the Company's stock-based compensation plans, which are made solely by the
Committee in order for the grants or awards under such plans to satisfy Rule
16b-3 under the Securities Exchange Act of 1934, as amended. Set forth below
is a report of the Personnel/Compensation Committee addressing the Company's
compensation policies for 1993 as they affected the Chief Executive Officer of
the Company and the Bank serving at the end of 1993, and the other two most
highly-compensated executive officers of the Company and the Bank at the end of
1993 who had total compensation in excess of $100,000, and two additional
highly-compensated executive officers who would have qualified for disclosure
if they had not terminated employment, (collectively, the "Named Executives").
The Named Executives compensation in 1993 is shown in the "Executive
Compensation Tables" below. All of the members of the Personnel/Compensation
Committee other than Mrs. Casey have joined the committee since the end of
1993, and their report is based on their best knowledge as to the compensation
philosophy and practices of the Personnel Committee in 1993.

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<PAGE> 38

PERSONNEL/COMPENSATION COMMITTEE REPORT ON 1993 EXECUTIVE COMPENSATION

COMPENSATION PHILOSOPHY

The compensation policies adopted by the Personnel Committee in 1992
and approved by the Board of Directors of the Bank, and continued in practice
during 1993, were designed to provide competitive levels of compensation,
reward improvements in corporate performance, recognize above-average
individual achievements and initiative, and thereby assist the Bank in
attracting and retaining qualified employees.

As noted above, the Personnel Committee either approved or recommended
to the Board of Directors payment amounts and award levels for all executives
of the Bank including the Named Executives. With regard to compensation
actions affecting Mr. Prentice, Chairman and Chief Executive Officer of the
Bank in 1992 and 1993, and Mr. Kent Price, Chairman and Chief Executive Officer
of the Bank in 1993, all of the non-employee members of the Board of Directors
acted as the approving body.

The Company and the Bank experienced significant financial losses in
1991, 1992 and 1993, and, in connection therewith, the Named Executives were
required to devote a substantial and unusual amount of time and effort in
dealing with non-performing assets, raising new capital, responding to
regulatory concerns and implementing changes in operating systems and controls.
Consequently, the use of traditional corporate performance measures such as
earnings per share or increases in book value to determine executive
compensation was not considered to be in the Company's best interests.
Therefore, there was no direct relationship in 1992 or 1993 between executive
compensation and the Company's financial performance, either as compared to the
Company's prior performance or as compared to the banking companies with which
the Company competes for executive talent. Instead, the 1992 and 1993
executive compensation programs of the Bank were designed to provide
compensation which would allow the Bank to attract and retain talented and
experienced executives necessary for management of the Bank's turnaround
program. The focus of the executive compensation program was on base salary,
although some effort was made to provide longer term incentives through the
grant of stock options. None of the Named Executives, with the exception of
Mr. Criss, received a cash bonus in 1992 or 1993.

Going forward, in addition to the philosophies described above, the
Committee will also be guided by the terms of the FDIC Order in setting
executive compensation. The FDIC Order provides that, without the prior
written approval of the FDIC, the Bank may not (a) pay a bonus to an executive
officer, or (b) provide compensation to an executive officer at a rate
exceeding his or her average rate of compensation (excluding bonuses, stock
options and profit-sharing) during the 12 calendar months preceding the months
in which the Bank first became undercapitalized.

SALARIES

In 1992, the Personnel Committee retained an outside consulting firm
to review the cash compensation of the Named Executives. The consulting firm
collected information on executive compensation from banking industry salary
surveys and from public data disclosed by a group of bank holding companies
determined by the consulting firm to be comparable to the Company and
competitive with the Company regarding the hiring of executive talent. This
peer group consisted of 15 bank holding companies located in California with
assets between $325 and $700 million. The consulting firm advised the
Personnel Committee that the salaries of the executives of the Bank were within
the fiftieth (50th) percentile of comparable institutions with respect to total
cash compensation. Individual executive base salaries were established in
accordance with job functions, responsibilities, and stated performance
objectives, in a manner consistent with external market data. As officers of a
financially troubled institution, operating as directed by a regulatory
enforcement action, the Named Executives during 1992 and 1993 were charged with
the responsibility for (i) identifying and working to resolve

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<PAGE> 39

asset quality problems; and (ii) developing and executing an operating plan to
deal with asset problems and comply with the terms and conditions of the
Memorandum of Understanding entered into with the FDIC and the State Banking
Department during the fourth quarter of 1991.

STOCK AWARDS

The Bank's Incentive Stock Option Plan (the "Stock Plan") expired in
1992. Options granted prior to the expiration date remain in effect and
exercisable during the ten-year term of the option. During 1993, the Board
adopted the 1993 Executive Stock Option Plan and the 1993 Non-Employee
Directors Stock Option Plan. However, no options were granted during 1993
under these plans or otherwise.

THE MEMBERS OF THE PERSONNEL/COMPENSATION COMMITTEE

Donna Miller Casey Carl D. Gustavson Linda M. Tanner Willard D. Sharpe

EXECUTIVE COMPENSATION TABLES

SUMMARY OF 1991-1993 COMPENSATION. The following table sets forth the
annual compensation, long-term compensation and other compensation paid to each
of the Named Executives. Compensation is listed as of December 31, 1993,
December 31, 1992 and December 31, 1991. Mr. Prentice and Mr. Adams have
terminated employment with the Bank and Company, all other positions listed on
the table are positions held by the Named Executives as of December 31, 1993.

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<PAGE> 40
SUMMARY COMPENSATION TABLE

<TABLE>
-------------------------------------------------------------------------------------------------------------------------
ANNUAL COMPENSATION LONG TERM COMPENSATION
-------------------------------------------------------------------------------------------------------------------------
AWARDS PAYOUT
-------------------------------------------------------------------------------------------------------------------------
OTHER ALL
ANNUAL RESTRICTED OTHER
COMPEN- STOCK LTIP COMPEN-
NAME AND PRINCIPAL SALARY BONUS SATION AWARD(S) OPTIONS/ PAYOUT SATION
POSITION YEAR ($) ($) ($) ($) SARS(#) ($) ($) (7)
-------------------------------------------------------------------------------------------------------------------------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
-------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Chairman/CEO - Former 1993 $166,672 0 490 0 0 0 7,944
1992 250,000 0 14,967 0 0 0 5,345
Thayer T. Prentice 1991 134,585 69,167 5,200 0 87,489 0 5,245
(1)
-------------------------------------------------------------------------------------------------------------------------
Chairman/CEO 1993 55,000 0 31,026 (2) 0 0 0 170
1992 0 0 0 0 0 0 0
Kent D. Price 1991 0 0 0 0 0 0 0
-------------------------------------------------------------------------------------------------------------------------
EVP/CFO - Former 1993 112,239 0 121,648 (3) 0 0 0 1,178
1992 135,385 0 23,898 0 35,000 0 1,766
William H. Adams 1991 128,000 207,386 (1) 25,408 9,153 (6) 8,000 0 4,095
-------------------------------------------------------------------------------------------------------------------------
President/COO 1993 178,077 0 4,180 (4) 0 0 0 759
1992 0 0 0 0 0 0 0
Rodney D. Freed 1991 0 0 0 0 0 0 0
-------------------------------------------------------------------------------------------------------------------------
EVP/CCO 1993 125,000 63,097 3,000 (5) 0 0 0 1,014
1992 77,724 0 13,560 0 0 0 507
C. William Criss, Jr. 1991 0 0 0 0 0 0 0
-------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) Includes certain extraordinary payments in connection with the
Company's and the Bank's standardization of employment arrangements.

(2) During the last fiscal year Mr. Price's "Other annual compensation"
consisted solely of consulting fees paid prior to October 1993 and
Regulatory approval of Mr. Price's positions held.

(3) During the last fiscal year Mr. Adams' "Other annual compensation"
consisted primarily of a severance payment of $87,500, a payout from
a split dollar life insurance policy of $27,674, consulting fees paid
of $3,475 and an auto allowance at a rate of $500 per month. All auto
allowances were eliminated as of July 1, 1993.

(4) During the last fiscal year Mr. Freed's "Other annual compensation"
consisted primarily of allowances for an auto allowance at a rate of
$500 per month. All auto allowances were eliminated as of July 1,
1993. Mr. Freed was also reimbursed for moving costs related to his
relocation from Singapore.

(5) During the last fiscal year Mr. Criss' "Other annual compensation"
consisted solely of an auto allowance at a rate of $500 per month.
All auto allowances were eliminated as of July 1, 1993.

(6) 2,034 shares x $1.125 (market price at 12/31/93)=$2,288.25. No
vesting schedule applicable on this stock. Restricted stock is
entitled to dividend payments. The Company has suspended payment of
dividends on its Class A Common Stock.

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<PAGE> 41

(7) "All other compensation" consists of group term life insurance
coverage and in the case of Mr. Prentice the addition of the premium
cost of an additional term life policy and in the case of Mr. Adams
the addition of the premium cost of split dollar life insurance.

OPTION GRANT TABLE. No stock option grants were made during 1993.

COMPENSATION COMMITTEE INTERLOCKS AND PARTICIPATION IN COMPENSATION DECISIONS

The Company's Personnel/Compensation Committee, which during 1993
consisted of Messrs. Prentice, Parrott, Rosetti, Mrs. Casey and Ms. Underwood,
and currently consists of Mrs. Casey, Ms. Tanner, Mr. Gustavson and Mr.
Sharpe, makes decisions with respect to the compensation of executive officers.
There are no Compensation Committee Interlocks as that term is defined under
Item 402(j) of Regulation S-K as promulgated under the Securities Exchange Act
of 1934, as amended, among the Committee members. Mr. Prentice was an
executive officer of the Bank, serving as its Chairman, President and Chief
Executive Officer. Ms. Underwood was an executive officer of the Bank serving
as its Executive Vice President-Administration. Ms. Tanner is an officer of
the Bank serving as Director of Human Resources.

EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
ARRANGEMENTS

EMPLOYMENT AGREEMENT OF MR. PRENTICE. The Bank entered into an
employment agreement with Mr. Prentice which, as amended on July 7, 1992,
provided, among other things, for Mr. Prentice to receive an annual salary of
at least $250,000 per year, payable in accordance with the Bank's usual payment
practices. Under the agreement, Mr. Prentice's term of employment would have
continued until December 31, 1997. However, Mr. Prentice resigned for personal
reasons on August 31, 1993, and agreed to the termination of his employment
agreement without the receipt of any additional compensation. Mr. Prentice's
Indemnification Agreements, described in "Certain Transactions" below,
continue in effect.

TERMINATION AGREEMENTS WITH CERTAIN FORMER EXECUTIVE OFFICERS OF THE
BANK. During the fourth quarter of 1991 and the first quarter of 1992 certain
executive officers resigned from their employment with the Bank. Effective
November 1, 1991, Mr. Stephens resigned as Chairman, Chief Executive Officer
and President of the Bank, while retaining those positions with the Company.
It was agreed that Mr. Stephens would not receive a salary as Chairman, Chief
Executive Officer and President of the Company, but that he would be entitled
to certain administrative support and ancillary benefits. Mr. Stephens
resigned as Chairman, Chief Executive Officer and President of the Company in
February 1993 and as a director of the Company in March 1993, and no longer
receives any administrative support or ancillary benefits from the Company or
the Bank.

In connection with the change in management of the Company and the
Bank in August 1993, the Company and the Bank entered into Separation
Agreements with each of William H. Adams, Marlene M. Underwood and Patrick S.
Day on August 4, 1993, under which these officers resigned all of their
positions with the Company and the Bank, released all claims against the
Company and the Bank, and received severance payments of $87,500, $52,500 and
$52,500 respectively.

In connection with the sale of the Bank's Sacramento Office, as an
inducement to the key personnel of that office to remain with the Bank and
complete the sale, the Bank entered into retention agreements with Mr. Martin
and four other officers who are not executive officers, providing for the
payment of a total of $100,000 ($40,000 for Mr. Martin) if such officers are
terminated by American River Bank, the purchaser of the office, within six
months of completion of the sale. The Bank's definitive agreement with
American River Bank provided that American River Bank will assume the Bank's
liabilities under such retention agreements in return for a $100,000 reduction
in the purchase price that American River Bank is required to pay. If the
actual amounts paid out by American River Bank under the severance agreements
are less than $100,000, American River Bank will refund the difference to the
Bank.

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<PAGE> 42

EMPLOYMENT AGREEMENTS WITH MESSRS. CHAMPION AND PRICE. The Company
and the Bank have entered into employment agreements (the "Employment
Agreements") with Messrs. Price and Champion, effective October 1, 1993, which
provide for the service of Mr. Price and Mr. Champion as, respectively,
Chairman and Chief Executive Officer, and Vice Chairman and Chief Financial
Officer of the Company and the Bank, and for the service of Mr. Champion as
Chief Investment Officer of the Bank. The Employment Agreements have an
initial term of three years and renew automatically on each anniversary
thereafter for rolling three-year terms, unless either party has provided
written notice of intent not to renew the Employment Agreements. The
Employment Agreements provide for a base annual salary of $350,000 but, until
the completion by the Company of one or more financings after August 1, 1993 in
which the Company receives gross proceeds of $15,000,000 or more, the base
annual salary shall be paid at a reduced rate of $220,000. The Employment
Agreements also provide for bonuses under an Annual Performance Bonus Plan to
be adopted effective when and if the Bank is restored to profitability.

The Employment Agreements provide that the Board of Directors shall
adopt an executive stock option plan and, subject to stockholder approval of
the plan, shall grant each of Messrs. Price and Champion options under the plan
to acquire shares of the Company's Class A Common Stock equal to 4% of the
fully-diluted shares of Class A Common Stock, with additional options to be
granted in the future as necessary to maintain the 4% ratio. Although such
options have not yet been granted, assuming stockholder approval of the plan at
the Annual Meeting, the effective date of the initial grant of options to
Messrs. Price and Champion would be September 30, 1993. For purposes of
determining the number of fully-diluted shares, Warrants would not be counted
until they become exercisable. Based on the current capitalization of the
Company, each of Mr. Price and Mr. Champion would receive options to purchase
1,976,615 shares of the Company, effective September 30, 1993. The options
granted to Messrs. Price and Champion would vest over a ten-year period, with
25% vesting on the first anniversary of the employment agreements, 15% vesting
on each of the three following anniversaries, and 5% vesting annually
thereafter until all options have vested. The exercise price of the options to
be granted effective September 30, 1993 would be $0.50 per share (the effective
price of the September Investment by Mr. Masagung), and the exercise price of
subsequent anti-dilution options would be the then-current fair market value of
the Class A Common Stock.

The Employment Agreements further provide that, in the event of a
Termination due to a Change in Control, as such terms are defined in such
Employment Agreements, if at the time of the Change in Control the fair market
value of the Class A Common Stock is more than twice its book value, Messrs.
Price and Champion shall each receive their annual salary through the
Termination Date (as such term is defined in the Employment Agreements), and
their most recent annual bonus prorated through the Termination Date, plus an
additional three years of salary and bonus, and all stock options previously
granted shall vest immediately. In the event of a Termination of Messrs. Price
and Champion by the Company without cause, or a Termination of employment by
Messrs. Price and Champion for cause, under the Employment Agreements Messrs.
Price and Champion would each receive their salary and prorated bonus through
the Termination Date, and an additional one year of salary and bonus. For this
purpose, Messrs. Price and Champion would be deemed to have cause to terminate
their Employment Agreement in the event of (a) any adverse change in their
positions or place of employment without their prior consent, or (b) any
material failure of the Company or the Bank to perform their obligations under
the Employment Agreements.

Under the Employment Agreements, Messrs. Price and Champion are
indemnified by the Company and the Bank from any liability or expense arising
as a result of actions taken by the Company or the Bank, or events relating to
the business of the Company or the Bank, occurring prior to the execution of
the Employment Agreements. Subject to certain limitations, Messrs. Price and
Champion are also indemnified by the Company and the Bank from any liability or
expense arising as a result of actions taken by the Company or the Bank, or
events relating to the business of the Company or the Bank, occurring after the
execution of the Employment Agreements, unless such liability or expense is due
to the officer's bad faith or gross negligence.

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<PAGE> 43
DESCRIPTION OF BENEFIT PLANS

STOCK OPTION PLANS. The Company had two stock option plans that
expired in February 1992 (collectively, the "Prior Stock Option Plans").
Each option granted prior to the termination of such plans remains in effect
and is exercisable during the term of such option. All options granted under
the Prior Stock Options Plans are currently out-of-the-money. During 1993, the
Board adopted the 1993 Executive Stock Option Plan and the 1993 Non-Employee
Directors Stock Option Plan. For a description of these plans, see "PROPOSAL
SIX: Approval of the 1993 Executive Stock Option Plan and the 1993 Non-Employee
Directors Stock Option Plan." No options were granted during 1993 under
these plans or otherwise.

EMPLOYEE STOCK OWNERSHIP PLAN. The Company established the Bank of
San Francisco Company Holding Company Employee Stock Ownership Plan (the
"ESOP") in 1985. The ESOP is non-contributory and has received a favorable
determination letter stating that it is qualified under Section 401(a) of the
Internal Revenue Code. Every employee of the Company and its affiliates who
has completed one year of service is a participant in the ESOP. The ESOP
provides benefits to a participant, primarily in the form of Class A Common
Stock, upon the retirement, death, disability or termination of employment of
the participant. The Company and its affiliates make contributions to the ESOP
in amounts determined by the Company, in its sole discretion, subject to
certain loan agreements entered into by the ESOP that require the Company to
contribute to the ESOP amounts sufficient to enable the ESOP to meet its
obligations under those loan agreements. Such contributions may be in cash or
in other property, including Class A Common Stock. At December 31, 1993, the
Company had contributed a total of $1.8 million to the ESOP since the ESOP's
establishment in 1985, including $120,000, $240,000 and $240,000 in 1993, 1992
and 1991, respectively.

During 1985, the ESOP borrowed $500,000 from a third party financial
institution at 90% of the institution's then-current prime rate. Repayment of
the principal was scheduled in seven annual installments of $71,000 through
June 30, 1992 and was completed as scheduled. The proceeds from the borrowing,
which was not guaranteed by the Company, were used to purchase 62,500 shares of
Class A Common Stock at a price of $8.00 per share. The stock purchased was
pledged as collateral for the loan. During 1988, the ESOP established a loan
for $650,000 from a third party financial institution at 95% of the
then-current prime rate. At December 31, 1988, the ESOP had drawn $325,000
from the loan agreement. Repayment of the principal is scheduled in quarterly
payments of $23,000 through March 31, 1995. Payment on this loan started in
the fourth quarter of 1988. The proceeds from the borrowing were used to
purchase 28,571 shares of Series B Preferred Stock at a price of $7.00 per
share, and the remaining amount to purchase Class A Common Stock throughout the
year. The stock purchased was pledged as collateral for the loan. During
1989, the ESOP drew the remaining $325,000 from the loan agreement. The
proceeds from the borrowing were used to purchase 50,000 shares of Class A
Common Stock at a price of $5.00 per share, and the remaining amount was used
during 1990 to purchase an additional 8,700 shares of Class A Common Stock at
an average price of $8.64 per share. During 1992, the ESOP did not purchase
any shares of Class A Common Stock. Company contributions were used in 1992,
and are being used presently, by the ESOP to pay installments on the ESOP's
indebtedness to the third party financial institutions.

Shares held by the ESOP are allocated to participants' accounts
annually as payments under the loan agreement between the ESOP and the
financial institutions are made. Contributions to the ESOP for a given year,
to the extent they are not used to repay borrowings of the ESOP, are allocated
to each participant's account in proportion to the participant's yearly
compensation. Of the amount in a participant's account, 20% is vested after
two (2) years of service, 40% after three (3) years of service, 60% after four
(4) years of service, 80% after five (5) years of service, and 100% after six
(6) years of service.

401(k) PROFIT SHARING PLAN. In 1986 the Company established a 401(k)
Profit Sharing Plan (the "Plan") which is intended to qualify under Sections
401(a) and 401(k) of the Internal Revenue Code. The Plan permits each
participating employee with six months of service to contribute to the Plan
through payroll

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<PAGE> 44
deductions ("salary deferral contributions") of from 2% to 16% of the
participant's eligible compensation from the Company and its subsidiaries,
thereby deferring taxes on all or a portion of these amounts. Under the Plan,
the Company currently will match a participant's tax deferred contributions by
an amount equal to 100% of such contribution for each year, except that the
matching contribution by the Company for the participant may not exceed 2% of
the participant's eligible compensation for that year. A participant who has
elected to make salary deferral contributions of from 2% to 16% of his
compensation in a year may also contribute up to 10% of his compensation for
that year on an after-tax basis.

The Company may also make additional contributions to the Plan in such
amounts as may be determined by the Company's Board of Directors. Any such
additional contributions are allocated among Plan participants based upon their
compensation levels. The Company's contribution vests 100% after a participant
has completed five years of participation in the Plan, with vesting of 20% per
year for each of years one through four. In addition, the Company's
contribution vests upon a participant's retirement at age 65 or upon a
participant's death or permanent disability. Participants are entitled to
receive their salary deferral contributions and vested benefits under the Plan
upon termination of employment, retirement, death or disability. Participants
have the right to allocate their salary deferral contributions among four
different investment funds. The amounts shown as salaries in the Summary
Compensation Table above include salary deferral contributions made by Mr.
Prentice.

EMPLOYEE STOCK PURCHASE PLAN. Under the Company's Employee Stock
Purchase Plan (the "Stock Purchase Plan"), which took effect on July 1, 1990,
any employee (other than "Ineligible Employees", which include employees who
hold the offices of Chairman of the Board, Chief Executive Officer, President,
Chief Operating Officer, Executive Vice President or Chief Financial Officer of
the Company or its subsidiaries), who has completed at least two years of
service with the Company or any subsidiary and customarily works for the
Company or any subsidiary more than 20 hours per week is eligible to
participate. Under the Stock Purchase Plan, a participant may purchase from
the Company during each "purchase period" up to a number of shares of Class A
Common Stock to be determined by the Company prior to the first day of any
purchase period, the purchase price for such shares being the lesser of (i) 85%
of the fair market value of such shares on the first day of the purchase period
or (ii) 85% of the fair market value of such shares on the last day of the
purchase period. Upon the purchase by a participant of shares, the Company
will award to the participant an equal number of shares, which awarded shares
will be subject to a five-year restriction on transfer and subject to
forfeiture in the event the participant's employment is terminated for any
reason during such five-year period. A total of 50,000 shares of Class A
Common Stock is available under the Stock Purchase Plan. The Company suspended
the Stock Purchase Plan in December 1991 as a result of the Company's financial
performance.

CERTAIN TRANSACTIONS

The Bank has had and expects to continue to have banking transactions
with many of the directors and executive officers of the Company and the Bank
(and their associates). Loans by the Bank to any director or executive officer
of the Company or any of its subsidiaries (or any associate of such persons)
have been made in the ordinary course of business on substantially the same
terms, including interest rates and collateral, as those prevailing at the time
for comparable transactions with other persons, and have not involved more than
the normal risk of collection or presented other unfavorable features. Loans
by the Bank to any director, executive officer or principal stockholder of the
Company or any of its subsidiaries (as such persons are defined by regulation)
are subject to limitations under California and federal law. Among other
things, a loan by the Bank to a director, executive officer, or principal
stockholder of the Company or any of its subsidiaries must be on
non-preferential terms and, if all loans to a given person exceed $25,000, such
loans must be approved in advance by the Bank's Board of Directors.

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The Bank and an affiliate of Donald R. Stephens, a former Chairman of
the Board and Chief Executive Officer of the Company who resigned as a director
of the Company in March 1993, are each 50% partners in Bank of San Francisco
Capital Partners ("Capital Partners"). The purpose of Capital Partners is to
participate in real estate syndications. Capital Partners has one limited
partnership operating and subscribed with Capital Partners as the general
partner. Capital Partners had no earnings in 1993 and is no longer an active
business.

Bank of San Francisco Building Company, a California limited
partnership (the "Building Partnership"), was formed in 1987 to hold the lease
on, rehabilitate, and lease space in the building at 550 Montgomery Street, San
Francisco, which presently serves as the headquarters of the Company and the
Bank. The Bank currently leases 75,488 square feet from the Building
Partnership under an operating lease expiring in 2022 with an option for an
additional 14 years, at a minimum annual net rental payment of approximately
$1,622,000. BSFRI, a wholly-owned subsidiary of the Bank, is the general
partner of the Building Partnership, and the Bank and a trust controlled by
Donald R. Stephens (the "D.R. Stephens affiliate") are among the limited
partners. BSFRI has a general partnership interest of 2.5% and receives 25% to
35% of the cash available for distribution, depending upon the level of cash
return to the limited partners, if a cash distribution is made. The Bank has a
limited partnership interest of 34.5%. The D.R. Stephens affiliate has a
limited partnership interest of 13.5%. Officers and directors of the Company
hold limited partnership interests which aggregate approximately 6.2%. During
1993, rent paid by the Bank to the Building Partnership was approximately
$1,641,700. Also during 1993, the Bank, BSFRI and the D.R. Stephens affiliate
received distributions of $207,407.40, $14,814.65, and approximately
$89,838.00, respectively, from the Building Partnership. The Bank's and
BSFRI's equity in the Building Partnership during 1993 totaled approximately
$2,011,400 and $156,122, respectively. As part of the series of transactions
in which the Building Partnership was formed, the Building Partnership entered
into an agreement with an affiliate of Donald R. Stephens to provide property
management services for the 550 Montgomery Street building for a fee of 5% of
gross rental receipts, with the term of the agreement continuing until at least
October 31, 2010. During 1993, the Building Partnership paid such affiliate
approximately $94,815.61 for providing such services. The Bank and the Company
contemplate making an offer to the limited partners of the Building Partnership
to purchase its units of limited partnership interest. See "Possible
Additional Sales of Securities."

The Company entered into Amended and Restated Indemnification
Agreements with all of the directors and executive officers of the Company
serving in October 1991, which provide for the Company to indemnify its
officers and directors to the fullest extent permitted under Delaware law. In
addition, the Bank entered into Indemnification Agreements with all of its
directors and executive officers serving in November 1991, which provide for
the Bank to indemnify its officers and directors to the fullest extent
permitted under California law. The Bank obtained an irrevocable standby
letter of credit in the amount of $300,000 issued by Bank of America NT&SA on
December 30, 1991 on behalf of Thayer T. Prentice, who at the time served as
Chairman of the Board, President and Chief Executive Officer of the Bank and a
director of the Company, as collateral for the Bank's obligations under its
Indemnification Agreement with Mr. Prentice. In addition, Mr. Prentice entered
into an indemnification arrangement with Mr. Stephens, which is similar to Mr.
Prentice's Indemnification Agreement with the Bank. Mr. Stephens obtained an
irrevocable standby letter of credit issued by Security Pacific National Bank
on behalf of Mr. Prentice in the amount of $200,000, as collateral for his
obligations under this indemnification arrangement with Mr. Prentice. Mr.
Prentice resigned his positions with the Bank and the Company on August 31,
1993.

Under their Employment Agreements, Messrs. Price and Champion would be
indemnified by the Company and the Bank from any liability or expense arising
as a result of actions taken by the Company or the Bank, or events relating to
the business of the Company or the Bank, occurring prior to the execution of
the Employment Agreements. Subject to certain limitations, Messrs. Price and
Champion would also be indemnified by the Company and the Bank from any
liability or expense arising as a result of actions taken by the Company or the
Bank, or events relating to the business of the Company or the Bank, occurring
after the execution of the Employment Agreements, unless such liability or
expense is due to the officer's bad faith or gross negligence.

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PROPOSAL TWO: AUTHORIZATION OF CONVERSION OF SERIES C PREFERRED STOCK
AND AMENDMENT OF CERTIFICATE OF INCORPORATION TO INCREASE
AUTHORIZED NUMBER OF SHARES AND REQUIRE CONVERSION OF
CERTAIN SHARES OF SERIES C PREFERRED STOCK

INTRODUCTION

In order to comply with the October 29 Letter Agreement which requires
the Company to submit to its stockholders a proposal to authorize the
conversion of Series C Preferred Stock into Class A Common Stock and Warrants
on the terms provided in the Series C Certificate of Designation, the Board of
Directors of the Company has unanimously adopted a resolution that submits for
stockholder approval at the Annual Meeting a proposal to authorize such
conversion, to amend the Certificate of Incorporation to increase the number
of authorized shares of Class A Common Stock to 400,000,000, and to amend the
Series C Certificate of Designation to provide for mandatory conversion of all
outstanding shares of Series C Preferred Stock on April 29, 1994. A copy of
the Company's Certificate of Amendment of Certificate of Incorporation, which
will be filed if PROPOSAL TWO is approved in order to effect the increase in
the authorized number of shares of Class A Common Stock and the mandatory
conversion of shares of Series C Preferred Stock outstanding on April 29,
1994, is attached hereto as Appendix B. A vote in favor of PROPOSAL TWO will
constitute a vote in favor of the proposed amendment of the Company's
Certificate of Incorporation, including the Series C Certificate of
Designation, as shown in said Appendix.

REASONS FOR APPROVING PROPOSAL TWO

As described in more detail in "Background Information" above, the
Principal Stockholder desired to purchase Class A Common Stock in October 1992,
and the Board of Directors would have approved the sale of Class A Common Stock
to him at that time if that sale could have been accomplished in a timely
fashion. When the Company and the Principal Stockholder agreed to a
transaction involving the Series C Preferred Stock which would be convertible
into Class A Common Stock and Warrants, subject to obtaining stockholder
approval of the conversion feature, the Board of Directors agreed to recommend
to the stockholders that they approve the conversion feature. Not only is
approval of the conversion feature a matter of fairness to the Principal
Stockholder, who provided critically-needed capital to the Company upon very
short notice, management also believes that causing the conversion of the
Series C Preferred Stock (coupled with the reverse stock split discussed in
PROPOSAL FOUR below) will greatly simplify the capital structure of the Company
and perhaps make it easier to raise additional capital in the future.

As discussed under the caption "Determinations by the Board of
Directors" on page 22, Management has discussed with Mr. Masagung the
possibility of amending the terms of the Series C Preferred Stock to eliminate
the issuance of Warrants when the Series C Preferred Stock is converted
following the Annual Meeting. If Mr. Masagung (and, if he so requires, his
potential transferees) agrees to such an elimination, it would no longer be
necessary to issue Warrants in the Private Placement in order to equalize the
interests of the investors in the Private Placement and Mr. Masagung (or their
respective transferees) in the Company. In such circumstances, the Company
would expect to seek the consent of investors in the Private Placement also to
not require the issuance of Warrants as a component of the Units.

Although dividends on the Series C Preferred Stock are not cumulative
and it is highly unlikely that the Company will pay dividends on any class of
its capital stock in the foreseeable future, conversion of the Series C
Preferred Stock will eliminate the requirement that dividends at the rate of 9%
per annum be paid on the Series C Preferred Stock in any given year before
dividends can be paid on the Class A Common Stock, and will eliminate the
liquidation preference of $20.00 per share that would otherwise be paid on the
Series C Preferred Stock on the dissolution and liquidation of the Company.
These dividend and liquidation preferences

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of the Series C Preferred Stock may make an investment in the Company's Class A
Common Stock less attractive.

In addition, although capital attributable to noncumulative preferred
stock such as the Series C Preferred Stock is normally included in Tier 1
capital for the Company and the Bank under FRB and FDIC regulatory minimum
capital requirements, the applicable regulations of both agencies also indicate
that it is desirable from a supervisory standpoint that voting common equity
remain the dominant form of Tier 1 capital. Therefore, the Board of Directors
believes that conversion of the Series C Preferred Stock may be looked upon
favorably by regulatory authorities.

OWNERSHIP OF SERIES C PREFERRED STOCK

At present, the Principal Stockholder owns all of the 900,000 shares
of Series C Preferred Stock that are issued and outstanding. However, Mr.
Kaharudin Latief of Jakarta, Indonesia, is currently in the process of
notifying the FRB and applying to the California State Banking Department for
approval to acquire shares of the Company. If and when he receives regulatory
clearance, Mr. Latief plans to acquire from the Principal Stockholder 300,000
shares of Series C Preferred Stock (or the shares of Class A Common Stock and
Warrants into which such shares of Series C Preferred Stock are converted).
Thus, while as of the date of this Proxy Statement, Mr. Latief has not acquired
any shares of Series C Preferred Stock, it is possible that as of the date of
the Annual Meeting or prior to April 29, 1994 (the date on which shares of
Series C Preferred Stock will be automatically converted if this PROPOSAL TWO
is approved by the Company's stockholders), Mr. Latief will own a significant
number of shares of Series C Preferred Stock. Mr. Latief plans to pay for the
shares acquired from the Principal Stockholder through cancellation of an
unsecured, personal loan in the amount of $6,000,000 which Mr. Latief
previously extended to the Principal Stockholder.

If the proposals are approved by the stockholders of the Company, the
Company anticipates that it will subsequently file with the Securities and
Exchange Commission ("SEC") a registration statement for the purpose of
registering a secondary offering by the holders thereof of (i) all of the
shares of Class A Common Stock currently owned by the Principal Stockholder,
(ii) the 286,000 shares of Class A Common Stock issued and sold to Stephens
upon cancellation of the Subordinated Term Note, (iii) all of the shares of
Class A Common Stock that may be issued upon exercise of the Anti-dilution
Warrants to acquire up to 102,207 shares of Class A Common Stock held by the
Principal Stockholder pursuant to the Amended Stock Purchase Agreement, (iv)
all of the shares of Class A Common Stock and shares of Class A Common Stock
that may be acquired upon exercise of the Warrants into which the Series C
Preferred Stock (whether currently outstanding or sold pursuant to an exercise
of the Series C Preferred Stock Option or otherwise) may be converted and (v)
all of the shares of Class A Common Stock and shares of Class A Common Stock
that may be acquired upon exercise of the Unit Warrants, that may be acquired
pursuant to the Private Placement. There can be no assurance that any such
registration statement will become effective or that it will be effective at
any particular time. If such a registration statement does become and remains
effective, the holders of such shares of Class A Common Stock and Warrants
would be able to sell them from time to time as they deem appropriate, in the
open market or otherwise, which would increase the "float" of the Class A
Common Stock (i.e., the number of shares that can trade without restriction in
the public capital markets). Sales pursuant to such a secondary offering
would not increase the Company's capital.

DESCRIPTION OF SERIES C PREFERRED STOCK

The principal features of the Series C Certificate of Designation
pursuant to which the Series C Preferred Stock was established are as follows:

1. Dividends. Holders of shares of Series C Preferred Stock are
entitled to receive, if, as and when declared by the Board of Directors of the
Company, an annual cash dividend of One Dollar and Eighty

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<PAGE> 48

Cents ($1.80) per share, payable semi-annually in April and October of each
year, before any dividends can be paid on the common stock of the Company.
Dividends on the Series C Preferred Stock are junior to payment of dividends at
the stated annual rate of Fifty-Six Cents ($.56) per share on the Series B
Preferred Stock. Dividends on the Series C Preferred Stock are not cumulative
and the Board of Directors has the right at any time to eliminate or defer such
dividends during any fiscal year of the Company. Management anticipates that
no dividends will be paid on the Series C Preferred Stock unless and until the
financial condition and operations of the Company and the Bank improve
significantly, which management does not believe will occur in the near future.
Moreover, if PROPOSAL TWO is approved at the Annual Meeting, all shares of
Series C Preferred Stock will be mandatorily converted into shares of Class A
Common Stock and Warrants as described below on April 29, 1994. See
"Conversion" below. Thus, if PROPOSAL TWO is approved, it is likely that no
dividends will ever be paid on the Series C Preferred Stock. Even if PROPOSAL
TWO is not approved, it is highly unlikely that the Company will pay dividends
on the Series C Preferred Stock in the foreseeable future.

2. Voting Rights. Subject to applicable law, the holders of
shares of Series C Preferred Stock are entitled to one vote per each share of
Series C Preferred Stock on all matters on which stockholders are entitled to
vote, including the election of directors. Holders of shares of Series C
Preferred Stock generally vote with the holders of shares of Class A Common
Stock, Class B Common Stock and the Series B Preferred Stock as a single class,
except that the holders of shares of the Series C Preferred Stock are entitled
to vote as a separate Class on any modifications to the rights of the holders
of shares of Series C Preferred Stock and otherwise as required by law.

3. Liquidation Preference. In the event of any liquidation,
dissolution, receivership, bankruptcy or winding up of the Company, voluntarily
or involuntarily, the holders of shares of Series C Preferred Stock are
entitled to receive the sum of Twenty Dollars ($20.00) per share, plus any
declared but unpaid dividends thereon, before any distributions will be made to
the holders of shares of Class A Common Stock, Class B Common Stock (of which
no shares are currently issued and outstanding) or any other Class of stock
junior in preference upon liquidation, but after distributions at the rate of
Seven Dollars ($7.00) per share on the Series B Preferred Stock and after or
concurrent with distributions to be made at the stated rate on any other
preferred stock of any Series ranking on a parity with or senior in preference
upon liquidation to the Series C Preferred Shares.

4. Conversion. Shares of the Series C Preferred Stock are not
currently convertible but will become so if the conversion feature is approved
by the holders of a majority of the Class A Common Stock and Series B Preferred
Stock (voting as a single class) at the Annual Meeting. If the conversion
feature of the Series C Preferred Stock is so approved, each share of Series C
Preferred Stock will become convertible into: (i) forty (40) shares of Class A
Common Stock (i.e., such shares will be converted at a conversion price of
Fifty Cents ($0.50) per share of Class A Common Stock); and (ii) forty (40)
warrants (the "Warrants"), each of which will entitle the holder thereof to
purchase one share of Class A Common Stock at Fifty Cents ($0.50) per share,
which Warrants shall expire on December 31, 1995. Moreover, if PROPOSAL TWO is
approved at the Annual Meeting, the Series C Preferred Stock outstanding on
April 29, 1994 will be mandatorily converted into Class A Common Stock and
Warrants on the terms described above.

EFFECT OF CONVERSION

The Principal Stockholder currently owns 5,600,000 or 62.9% of the
issued and outstanding shares of Class A Common Stock and 900,000 or 100% of
the issued and outstanding shares of Series C Preferred Stock. He currently
does not own any of the 16,591 issued and outstanding shares of Series B
Preferred Stock. Before any conversion of the Series C Preferred Stock, the
Principal Stockholder owns 66.2% of the total number of issued and outstanding
shares of capital stock of the Company and thus controls 66.2% of the voting
power of the Company's stockholders. If the conversion feature of the Series C
Preferred Stock is approved by the stockholders at the Annual Meeting and if
the Principal Stockholder converts all of the shares of Series C Preferred
Stock owned by him into Class A Common Stock and Warrants as described above
(as he will be

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<PAGE> 49

required to do on April 29, 1994), he would receive 36,000,000 shares of
Class A Common Stock and would then own approximately 92.6% of the voting power
of the Company's stockholders, assuming he does not sell any shares to Mr.
Latief. THUS, IF THE CONVERSION FEATURE OF THE SERIES C PREFERRED STOCK IS
APPROVED AT THE ANNUAL MEETING, THE PRINCIPAL STOCKHOLDER'S VOTING POWER AND
CONTROL OVER THE COMPANY WILL BE SIGNIFICANTLY INCREASED. The Principal
Stockholder's control would increase further if the Principal Stockholder also
exercises all of said Warrants to purchase additional shares of Class A Common
Stock at a purchase price of Fifty Cents ($.50) per share (the Company
understands that the Principal Stockholder currently does not contemplate
exercising any Warrants), in which case he would receive an additional
36,000,000 shares of Class A Common Stock and would then own approximately
95.9% of all issued and outstanding shares of capital stock.

Subject to the dilutive effect of the Private Placement, as a result
of his ownership of Class A Common Stock and Series C Preferred Stock, the
Principal Stockholder has, and will in all likelihood continue to have for the
near future, sufficient voting power to enable him to exercise control over
virtually all aspects of the operations of the Company and the Bank except to
the extent that he sells securities owned by him or other parties purchase
additional securities. See "Ownership of Series C Preferred Stock," "Proposed
Registration of Securities," "PROPOSAL THREE: Increase in Number of Authorized
Shares of Preferred Stock" and "PROPOSAL FIVE: Authorization for Issuance of
Additional Shares of Class A Common Stock, Warrants and Rights."

REQUIRED CONVERSION OF CERTAIN SHARES OF SERIES C PREFERRED STOCK

The Certificate of Designation currently provides that, subject to
obtaining the approval of the stockholders of the Company, all of the shares of
Series C Preferred Stock that are issued and outstanding on June 30, 1993 will
automatically be converted into shares of Class A Common Stock and Warrants as
described above as of that date. The June 30 automatic conversion date was
established on the assumption that the Company would be able to hold its 1993
Annual Meeting of Stockholders prior to that date. The Company has delayed its
Annual Meeting, and has issued shares of Series C Preferred Stock to the
Principal Stockholder after June 30, 1993.

Because the June 30, 1993 projected conversion date has passed, and
because management believes it is in the best interests of the Company and its
stockholders for all Series C Preferred Stock that has been or will be issued
to be converted into Class A Common Stock and Warrants, the Board believes it
is advisable to amend the Series C Certificate of Designation to delete the
provision referring to mandatory conversion on June 30, 1993, and to provide
instead that any shares of Series C Preferred Stock outstanding on April 29,
1994 shall automatically be converted to Class A Common Stock and Warrants.
Accordingly, a vote in favor of PROPOSAL TWO will constitute a vote in favor of
an amendment to the Certificate of Designation to provide that any shares of
Series C Preferred Stock that are outstanding on April 29, 1994 will
mandatorily be converted into Class A Common Stock and Warrants on the terms
otherwise described in the Certificate of Designation.

NECESSARY INCREASE OF AUTHORIZED SHARES TO IMPLEMENT CONVERSION

If PROPOSAL TWO is approved by the stockholders at the Annual Meeting,
the conversion feature of the Series C Preferred Stock will become fully
operative and it will be necessary for the Company to reserve a sufficient
number of shares of Class A Common Stock to be issued upon the conversion of
the Series C Preferred Stock and the possible exercise of the Warrants. The
Company's Certificate of Incorporation currently provides for authorized
capital of 20,000,000 shares of Class A Common Stock, 28,635 shares of Class B
Common Stock (none of which have been issued) and 2,500,000 shares of Preferred
Stock, of which 437,500 shares have been designated as Series B Preferred Stock
and 1,800,000 shares have been designated as Series C Preferred Stock. As of
March 24, 1994, the Company had 8,899,932 shares of Class A Common

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<PAGE> 50
Stock, 16,591 shares of Series B Preferred Stock and 900,000 shares of Series C
Preferred Stock issued and outstanding.

In order to reserve a sufficient number of shares of Class A Common
Stock to be issued if all of the outstanding Series C Preferred Stock owned by
the Principal Stockholder is converted and all of the Warrants are exercised,
and if the options which the Company has agreed in the Employment Agreements to
grant to Messrs. Price and Champion are granted, it will be necessary to amend
the Company's Certificate of Incorporation to authorize the Company to issue a
total of at least 90,000,000 shares of Class A Common Stock. In order to
increase the ability of the Company to raise capital in the future by issuing
shares of Class A Common Stock or securities convertible into Class A Common
Stock, and because the Company is contemplating a private placement of at least
$15 million in which the Principal Stockholder's ownership of the Company
could be reduced significantly, possibly even to below 25%, the Company is
proposing to increase the total number of authorized shares significantly above
90,000,000, to 400,000,000. See "PROPOSAL THREE-Increase in Number of
Authorized Shares of Preferred Stock" below for a description of the Company's
preliminary planning for such private placement.

However, if PROPOSAL FOUR below and its one-for-ten reverse stock
split is adopted along with PROPOSAL TWO, the interplay of this PROPOSAL TWO
with PROPOSAL FOUR would result in a total of 40,000,000 authorized shares of
Class A Common Stock and approximately 9,000,000 shares outstanding or
reserved for issuance, leaving approximately 31,000,000 shares available for
issuance. The Company is required by its Certificate of Incorporation to
seek stockholder approval of an issuance of authorized shares of Class A Common
Stock IF (a) the issuance requires amendment of the terms of the Class A
Common Stock or of the Certificates of Designation of the Series B Preferred
Stock or the Series C Preferred Stock, or (b) the issuance is not approved by a
unanimous vote of the Company's Board of Directors. In addition, under the
AMEX Rules, if the Company issues common stock constituting 20% or more of the
then-outstanding common stock for less than the greater of book or market value
of the common stock without obtaining stockholder approval pursuant to a proxy
solicitation conducted in accordance with SEC rules, the Company could be
subject to action by the AMEX to delist the Class A Common Stock.

Although the Company is submitting the Private Placement for the
approval of the stockholders, the Company is unable to predict whether any
Class A Common Stock it may issue in the future will meet these AMEX criteria.
Therefore, if PROPOSAL TWO is approved, the Company could issue Common Stock
without further authorization by stockholders of the Company. Holders of the
Class A Common Stock of the Company do not have preemptive rights to subscribe
to any additional capital stock issued by the Company. If PROPOSAL TWO is
approved and some or all of the approximately 310,000,000 shares of Class A
Common Stock (approximately 31,000,000 shares if the 1-for-10 reverse stock
split described in PROPOSAL FOUR is adopted) available for issuance as a result
are subsequently issued, the holdings of existing stockholders, already diluted
significantly by the conversion of the Series C Preferred Stock, would be
diluted even further. For example, a person holding 1% of the Class A Common
Stock currently would hold only 0.2% of the Class A Common Stock assuming that
the 900,000 shares of Series C Preferred Stock are converted and no Warrants
are exercised, and would hold only 0.1% of the Class A Common Stock if an
additional 30,000,000 shares of Class A Common Stock are authorized and issued
to persons other than the stockholder.

RIGHTS OF DISSENTING STOCKHOLDERS

Under the Delaware General Corporation Law, stockholders of the
Company are not entitled to any rights of appraisal or dissenters' rights in
connection with the adoption of PROPOSAL TWO: AUTHORIZATION OF CONVERSION OF
SERIES C PREFERRED STOCK AND AMENDMENT OF CERTIFICATE OF INCORPORATION TO
INCREASE AUTHORIZED NUMBER OF SHARES AND REQUIRE CONVERSION OF CERTAIN SHARES
OF SERIES C PREFERRED STOCK.

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<PAGE> 51

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR
PROPOSAL TWO: AUTHORIZATION OF CONVERSION OF SERIES C PREFERRED
STOCK AND AMENDMENT OF CERTIFICATE OF INCORPORATION TO
INCREASE THE AUTHORIZED NUMBER OF SHARES OF CLASS A
COMMON STOCK, AND TO CHANGE THE REQUIRED CONVERSION
DATE OF SERIES C PREFERRED STOCK

PROPOSAL THREE: AUTHORIZATION OF AMENDMENT OF CERTIFICATE
OF INCORPORATION TO INCREASE THE AUTHORIZED NUMBER
OF SHARES OF PREFERRED STOCK

INCREASE IN NUMBER OF AUTHORIZED SHARES OF PREFERRED STOCK

As stated above, the Certificate of Incorporation currently authorizes
the issuance of 2,500,000 shares of Preferred Stock, with such rights,
preferences and privileges as established by the Board of Directors in a
certificate of designation relating to such Preferred Stock. The Company has
already designated 437,500 shares of Series B Preferred Stock and 1,800,000
shares of Series C Preferred Stock, so only 262,500 shares of Preferred Stock
remain undesignated under the current Certificate of Incorporation. The
Company is proposing to increase the number of authorized shares of Preferred
Stock to 5,000,000 in order to provide the Company with increased flexibility
to raise capital by issuing Preferred Stock with characteristics different than
those of the Series B and Series C Preferred Stock. A copy of the Company's
Certificate of Amendment of Certificate of Incorporation, which will be filed
if PROPOSAL THREE is approved in order to effect the increase in the authorized
number of shares of Preferred Stock, is attached hereto as Appendix C. A vote
in favor of PROPOSAL THREE will constitute a vote in favor of the proposed
amendment of the Company's Certificate of Incorporation as shown in said
Appendix.

The Company is required by the terms of its Certificate of
Incorporation to seek stockholder approval of an issuance of Preferred Stock if
(a) the issuance requires amendment of the Certificates of Designation of the
Series B Preferred Stock or the Series C Preferred Stock, or (b) the issuance
is not approved by a unanimous vote of the Company's Board of Directors. In
addition, under the AMEX Rules, if the Company issues securities that are
convertible into common stock equal to 20% or more of the then-outstanding
common stock, and are sold for less than the greater of book or market value of
the common stock, without obtaining stockholder approval pursuant to a proxy
solicitation conducted in accordance with SEC rules, the Company could be
subject to action by the AMEX to delist the Class A Common Stock. If PROPOSAL
THREE is approved and Preferred Stock is issued, the amount and terms of the
securities to be issued, including dividend or interest rates, conversion
prices, voting rights, redemption prices, maturity dates, and similar matters
could be determined by the Board of Directors and the securities could be
issued without further authorization by stockholders of the Company. Even if
stockholder approval is required, due to the extent of the Principal
Stockholder's voting power, if he were to vote all of his shares in favor of
the issuance of securities, passage of the proposal would be assured. If
PROPOSAL THREE is approved and some or all of the additional 2,500,000 shares
of Preferred Stock available for issuance as a result are subsequently issued,
the holdings of existing stockholders, already diluted significantly by the
conversion of the Series C Preferred Stock (assuming passage of PROPOSAL TWO),
could be diluted even further.

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THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR
PROPOSAL THREE: AUTHORIZATION OF AMENDMENT OF CERTIFICATE
OF INCORPORATION TO INCREASE THE AUTHORIZED NUMBER
OF SHARES OF PREFERRED STOCK

PROPOSAL FOUR: AUTHORIZATION OF AMENDMENT AND RESTATEMENT
OF CERTIFICATE OF INCORPORATION, INCLUDING
AUTHORIZATION OF REVERSE STOCK SPLIT

INTRODUCTION

The Board of Directors of the Company has unanimously adopted a
resolution that submits for stockholder approval at the Annual Meeting an
amendment (the "Amendment") to the Company's Certificate of Incorporation that
would (a) reclassify the Class B Common Stock as and into Class A Common Stock,
(b) effect a 1-for-10 reverse stock split of the Class A Common Stock and
thereby decrease the authorized number of shares of the Company's Class A
Common Stock to 40,000,000 (the "Reverse Split") (assuming approval of
PROPOSAL TWO -- see the next succeeding paragraph), (c) change the name of the
Company to The San Francisco Company, (d) delete from the Certificate Article
Fifth, which only provides the name and address of the incorporator of the
Company and is no longer necessary, (e) update Article Fifteenth of the
Certificate (which would become Article Fourteenth), and (f) restate the
Certificate in its entirety. A copy of the Company's Amended and Restated
Certificate of Incorporation is attached hereto as Appendix D. A vote in favor
of PROPOSAL FOUR will constitute a vote in favor of the proposed amendments and
restatement as shown in said Appendix.

If the Amendment is approved by the stockholders of the Company, the
Board of Directors will then vote upon the Amendment. Management of the
Company anticipates that the Amendment will be approved by the Board of
Directors if PROPOSAL TWO is approved by the stockholders of the Company. If
PROPOSAL TWO is not approved by the stockholders of the Company, the Board of
Directors will not approve the Reverse Split, although it anticipates that it
will approve the other items in the Amendment. If the Board of Directors
approves the Amendment, then pursuant to the Amendment each ten shares of Class
A Common Stock outstanding at the effective date of the Reverse Split (the
"Effective Date") will be converted into one post-Reverse Split share of the
Company's Class A Common Stock (the "New Common Stock"). The Effective Date
will be the date on which the Amendment is filed with the Secretary of State of
the State of Delaware. No fractional shares will be issued; rather,
stockholders who would otherwise be entitled to a fractional share as a result
of the Reverse Split will receive cash in the amount described below.

SERIES B PREFERRED STOCK; RECLASSIFICATION OF CLASS B COMMON STOCK

At present the holders of Series B Preferred Stock are entitled at any
time to convert their shares of Series B Preferred Stock into Class B Common
Stock of the Company at the conversion ratio of one share of Series B Preferred
Stock for one share of Class B Common Stock, upon payment of a conversion fee
of Seven Dollars ($7.00) per share, subject to adjustment under certain
conditions.

There are 16,591 Series B Preferred Shares outstanding. There are no
shares of Class B Common Stock outstanding. In order to equitably reflect the
conversion rights of the Series B Preferred Stock in light of the Reverse
Split, the Company proposes that, pursuant to the Amendment, shares of Class B
Common Stock be reclassified as and into Class A Common Stock. As a result,
there will be no authorized Class B Common Stock and the only common stock of
the Company which will be authorized will be Class A Common Stock.

-46-
<PAGE> 53

Accordingly, as a result of the conversion adjustment provisions of the Series
B Preferred Stock, following the Reverse Split, each share of Series B
Preferred Stock will be convertible into one-tenth of one share of Class A
Common Stock. This reclassification is not deemed by the Company to alter or
change any of the relative powers, preferences or special rights of the holders
of Series B Preferred Stock since in all respects the shares of Class B Common
Stock and the shares of Class A Common Stock are equivalent. Because no shares
of Class B Common Stock are presently outstanding, the only method to
practicably avoid the inequity is to reclassify the Class B Common Stock. The
reclassification merely prevents the inequitable result of the Class A Common
Stock being adjusted as a result of the Reverse Split without a similar
adjustment in Class B Common Stock.

REASONS FOR APPROVING THE REVERSE SPLIT

Assuming that all of the currently outstanding shares of Series C
Preferred Stock are converted into shares of Class A Common Stock and Warrants,
the Company would have outstanding a total of 44,899,932 shares of Class A
Common Stock and Warrants to purchase an additional 36,000,000 shares of Class
A Common Stock. The Principal Stockholder also holds the Anti-dilution
Warrants entitling him to purchase up to 102,207 shares of Class A Common
Stock.

While management of the Company believes that the actual issuances of
Series C Preferred Stock have been in the best interests of the Company and
its stockholders, it also believes that upon conversion of the Series C
Preferred Stock, there will be too many shares of Class A Common Stock issued
and outstanding for a corporation of the Company's size. Even if the Company
returns to profitability, it will likely report very low earnings per share and
book value per share because there will be so many shares of Class A Common
Stock outstanding. This could have an adverse effect on the marketability and
trading price of the Class A Common Stock.

Many brokerage firms are reluctant to recommend lower priced stocks
for their clients, and the policies and practices of a number of brokerage
houses tend to discourage individual brokers within those firms from dealing in
lower priced stocks. Management of the Company also believes that certain
institutional investors are reluctant to invest in lower priced stocks. In
addition, the brokerage commission on the purchase or sale of a stock with a
relatively low price per share generally tends to represent a higher percentage
of the sales price than the brokerage commission charged on a stock with a
relatively high price per share, to the detriment of the holders of the Class A
Common Stock and the market for the Class A Common Stock. Finally, the Board
of Directors believes that the raising of new capital may be facilitated if the
price and book value per share of the Class A Common Stock can be increased.
The Board of Directors believes that these issues are best addressed by an
increase in the price per share of the Class A Common Stock that is anticipated
as a result of the proposed Reverse Split, although no assurances can be given
that such an increase will occur if the Reverse Split is implemented, or that
such price per share, if it does rise, will rise in proportion to the Reverse
Split or that any such rise will be sustained for a significant period.

In addition, even if the Reverse Split is implemented, there can be no
assurance that brokerage firms will be more inclined to recommend the Class A
Common Stock or that institutional investors will be more inclined to invest in
the Class A Common Stock or that an increased price will facilitate any
possible raising of additional capital. If the market value of the Class A
Common Stock does not adjust proportionately, a significant loss of stockholder
value could result. In addition, a Reverse Split reduces the number of shares
of Class A Common Stock outstanding, thereby adversely affecting liquidity and
possibly depressing the price of the Class A Common Stock. The Reverse Split
also would cause the Class A Common Stock to have fewer than 300 round lot
shareholders of record, which under guidelines adopted by AMEX would normally
lead AMEX to consider delisting the Class A Common Stock. Such delisting
could severely impair the marketability of the Class A Common Stock.
Nevertheless, the Company believes that, because it meets other listing
guidelines adopted by the AMEX, the Reverse Split is not likely to cause the
AMEX to initiate

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<PAGE> 54

proceedings for delisting the Class A Common Stock. For the reasons set forth
above, the Board of Directors believes that stockholder approval of the
Amendment to effect the Reverse Split is advisable at this time.

VESTING DISCRETION IN THE BOARD OF DIRECTORS

At present, the Board of Directors expects to direct management to
file the Amendment as promptly as practicable if approved by stockholders of
the Company. However, the Board would not be obligated to direct management to
file the Amendment, and would direct management not to file the portion of the
Amendment related to the Reverse Split if PROPOSAL TWO with respect to the
conversion of the Series C Preferred Stock is not approved by the stockholders.

GENERAL EFFECT OF REVERSE SPLIT

The New Common Stock will not be different from the Common Stock, and
the holders of the New Common Stock or options or warrants to purchase the New
Common Stock will have the same relative rights following the Effective Date as
they had prior thereto. The Reverse Split will not affect the number of shares
of Series B Preferred Stock that are issued and outstanding at the Effective
Date and the voting rights of the Series B Preferred Stock will not be
adjusted for the Reverse Split. The ratio at which such Series B Preferred
Stock can be converted will be adjusted proportionately for the Reverse
Split, as is described in more detail below.

The following table shows the effect of the Reverse Split on the
aggregate number of shares of the Company's Class A Common Stock, Series B
Preferred Stock, and Series C Preferred Stock and on the stockholders' equity
section of the Company's balance sheet, on a pro forma basis, as of December
31, 1993, assuming that PROPOSAL TWO had been adopted on or prior to that date,
that all of the shares of Series C Preferred Stock outstanding as of that date
had been converted into shares of Class A Common Stock and Warrants, and that
none of the Warrants had been exercised to purchase additional shares of Class
A Common Stock:

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<PAGE> 55
<TABLE>
<CAPTION>
PRIOR TO AFTER
PROPOSED REVERSE PROPOSED REVERSE
SPLIT SPLIT(2)
---------------------------------------
<S> <C> <C>
Number of Shares(1)
- ----------------

Class A Common Stock
Authorized . . . . . . . . . . . . . . . . 400,000,000 40,000,000
Issued and outstanding . . . . . . . . . . 44,899,932 4,489,993
Available for issuance . . . . . . . . . . 355,100,068 35,510,007

Preferred Stock
Authorized . . . . . . . . . . . . . . . . 2,500,000 2,500,000(3)
Series B Preferred Stock
Designated . . . . . . . . . . . . 437,500 437,500
Issued . . . . . . . . . . . . . . 16,591 16,591
Available for issuance . . . . . . 420,909 420,909

Series C Preferred Stock
Designated . . . . . . . . . . . . 1,800,000 1,800,000
Issued . . . . . . . . . . . . . . 0 0
Available for issuance . . . . . . 1,800,000 1,800,000

Undesignated Preferred Stock available
for issuance . . . . . . . . . . . . . . . 262,500 262,500(3)

Stockholders' Equity
- --------------------
Series B Preferred Stock . . . . . . . . . $ 116,137 $ 116,137
Series C Preferred Stock . . . . . . . . . 0 0
Class A Common Stock . . . . . . . . . . . 448,999 44,900
Additional paid-in capital . . . . . . . . 52,217,373 52,621,472
Deficit . . . . . . . . . . . . . . . . (35,101,000) (35,101,000)
Employee purchase and option plans . . . (166,000) (166,000)
Total stockholders' equity . . . . . . . . 17,455,000 17,455,000
Stockholders' equity per common share
outstanding . . . . . . . . . . . . . . . $0.39 $3.90
</TABLE>

- ---------------------

(1) The pro forma number of shares outstanding and stockholders' equity as
of December 31, 1993 reflects the conversion of 900,000 shares of
Series C Preferred Stock into 36,000,000 shares of Class A Common
Stock and Warrants to purchase an additional 36,000,000 shares of
Class A Common Stock, and assumes such Warrants are not exercised, as
the Company has been informed that the Principal Stockholder has no
present intention to exercise the Warrants. Said pro forma number
does not reflect (a) any shares of Class A Common Stock that may be
issued upon exercise of the Anti-dilution Warrants to acquire up to
102,207 shares of Class A Common Stock which the Principal Stockholder
acquired under the May 1992 Amended Stock Purchase Agreement, or (b)
any shares of Class A Common Stock that may be issued pursuant to
options granted under the Stock Option Plans or the New Stock Option
Plans,

(2) The number of shares shown above as being outstanding after the
Reverse Split do not reflect any adjustments that may result from the
repurchase of fractional shares.

(3) The number of shares of Preferred Stock available for issuance will be
increased as a result of the approval of PROPOSAL THREE.

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<PAGE> 56
EFFECT ON REGISTRATION

The Class A Common Stock is currently registered under Section 12(b)
of the Securities and Exchange Act of 1934 as amended (the "1934 Act"), and as
a result, the Company is subject to the periodic reporting and other
requirements of the 1934 Act. The Reverse Split will not affect the
registration of the Common Stock under the 1934 Act.

EFFECT ON THE MARKET FOR THE COMMON STOCK

The Company's Class A Common Stock is listed on the American Stock
Exchange under the symbol "BOF." The closing sale price for the Class A Common
Stock on the American Stock Exchange on February 18, 1994, was $1.69. The
following table sets forth the high and low closing sale prices for the Class A
Common Stock on the American Stock Exchange for each calendar quarter during
1992 and 1993.

<TABLE>
<CAPTION>
QUARTER 1993 1992
----------------------------------------------------------------------------
High Low High Low
<S> <C> <C> <C> <C>
First $3.50 1.25 $4.13 2.75
Second 2.68 1.12 4.13 2.38
Third 1.62 1.00 4.25 2.00
Fourth 1.33 .75 2.25 1.0
</TABLE>

The shares of Series B Preferred Stock were listed on the American
Stock Exchange at the time of their issuance in October 1988. In March 1990,
the Company received approval from the Securities and Exchange Commission to
delist the Series B Preferred Stock, pursuant to Rule 12d2-2(d), under the 1934
Act. The primary reason for the delisting of the Series B Preferred Stock was
the limited trading activity of the stock. As a result, there is no public
market for the Series B Preferred Stock. However, the Company has established
procedures to assist stockholders of the Series B Preferred Stock in the event
that they wish to transfer their shares. The Series C Preferred Stock has
never been listed on any exchange or traded in any other public market.

Management anticipates that after the Effective Date, the market price
of shares of New Common Stock will increase as a result of the decrease in the
number of shares outstanding. However, there is no assurance that such an
increase will occur and, if so, it cannot be predicted whether any such
increase will be in proportion to the Reverse Split. The Reverse Split also
would cause the Class A Common Stock to have fewer than 300 round lot
shareholders of record, which under guidelines adopted by AMEX would normally
lead AMEX to consider delisting the Class A Common Stock. Such delisting could
severely impair the marketability of the Class A Common Stock. Nevertheless,
the Company believes that, because it meets other listing guidelines adopted by
the AMEX, the Reverse Split is not likely to cause the AMEX to initiate
proceedings for delisting the Class A Common Stock.

EFFECT ON OPTIONS, WARRANTS AND CONVERTIBLE SECURITIES

Pursuant to anti-dilution provisions set forth in the Prior Stock
Option Plans and the New Stock Option Plans, the number of shares that may be
issued under the New Stock Option Plans (including options to be granted to
Messrs. Price and Champion under their Employment Agreements), and the number
of shares issuable upon the exercise of outstanding options granted under the
Stock Option Plans, will be decreased in proportion to the Reverse Split, and
the exercise price per share of such outstanding options will be
proportionately increased. Outstanding options under the Stock Option Plans
will be rounded to the nearest whole share, and no cash payment will be made in
respect of any fractional shares.

-50-
<PAGE> 57
Thus, for example, if an employee of the Company owns an option to
purchase 5,000 shares of Class A Common Stock of the Company at $2.00 per
share, then on and as of the Effective Date, the terms of the option will be
adjusted so that the option represents the right to purchase 500 shares of New
Common Stock at an exercise price of $20.00 per share. No payment will be made
in respect of the rounding of any extra fractional share.

Assuming that none, or less than all of the Warrants will be exercised
upon conversion of the Series C Preferred Stock, the remaining Warrants would
be affected by the Reverse Split. The Company also has outstanding the
Anti-dilution Warrants to acquire up to 102,207 shares of Class A Common
Stock, which were issued to the Principal Stockholder in connection with the
Amended Stock Purchase Agreement. Under the anti-dilution provisions of the
Warrants and the Anti-dilution Warrants, the number of shares issuable upon
the exercise of the warrants will decrease in proportion to the Reverse Split,
and the exercise price of such warrants will increase proportionately. For
example, each Warrant would entitle the holder to purchase four (instead of 40)
shares of Class A Common Stock, at $5.00 (rather than $0.50) per share.

The shares of Series B Preferred Stock are convertible into shares of
Class B Common Stock upon payment of a conversion fee of $7.00 per share.
Under the anti-dilution provisions of the Certificate of Designations of
Rights, Preferences and Privileges related to the Series B Preferred Stock, the
number of shares of Class B Common Stock issuable upon the conversion of the
Series B Preferred Stock will decrease in proportion to the Reverse Split and
the conversion fee will increase proportionately. As described above, pursuant
to the Amendment all Class B Common Stock would be reclassified as and into
Class A Common Stock. Finally, under the anti-dilution provisions of the
Series C Certificate of Designations, the number of shares of Class A Common
Stock and Warrants into which outstanding shares of Series C Preferred Stock
may be converted will decrease in proportion to the Reverse Split, and the
exercise price of the Warrants will increase proportionately. Thus any shares
of Series C Preferred Stock issued after the effective date of the Reverse
Split would be convertible into four shares of Class A Common Stock and four
Warrants each entitling the holder thereof to purchase shares of Class A Common
Stock at a price of $5.00 per share.

EXCHANGE OF STOCK CERTIFICATES AND LIQUIDATION OF FRACTIONAL SHARES

As soon as practicable after the Effective Date, the stockholders will
be notified and requested to surrender their certificates representing shares
of Class A Common Stock to the Company's transfer agent so that certificates
representing the appropriate number of shares of New Common Stock, together
with a cash payment in lieu of any fractional share, may be issued in exchange
therefor. As a result of the "cash-out" of fractional shares, stockholders
holding fewer than 10 shares will receive only cash and will no longer hold any
Class A Common Stock. Based on the number of stockholders of record of the
Class A Common Stock as of the Record Date, the Reverse Split would cause a
reduction in the number of stockholders of record from 466 to 443.

No scrip or fractional certificates will be issued in connection with
the proposed Reverse Split. Rather, the Company will pay cash in lieu of any
fraction of a share that any stockholder would otherwise receive. The price
for such fractional share will be based upon the average of the closing prices
per share on the AMEX for the Class A Common Stock for the ten trading days
immediately preceding the Effective Date of the Reverse Split.

FEDERAL INCOME TAX CONSEQUENCES

A summary of the material federal income tax consequences of the
proposed Reverse Split is set forth below. The following discussion is based
upon present federal tax law and does not purport to be a complete discussion
of such consequences for all stockholders in all circumstances, nor does it
address state, local or foreign tax consequences or considerations.
ACCORDINGLY, STOCKHOLDERS ARE ADVISED TO CONSULT THEIR OWN TAX ADVISORS FOR
MORE DETAILED INFORMATION REGARDING THE EFFECTS OF THE PROPOSED REVERSE SPLIT
ON THEIR INDIVIDUAL TAX STATUSES.

1. The proposed Reverse Split will not be a taxable transaction
to the Company.

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<PAGE> 58
2. A stockholder will not recognize any gain or loss as a result
of the Reverse Split unless the stockholder receives cash in lieu of a
fractional share. Although it is impossible to predict with certainty the tax
consequences to any stockholder who receives cash in lieu of a fractional
share, such stockholder, depending on the circumstances, will either (i)
recognize gain or loss as a result of the Company's purchase of a fractional
share based upon the amount realized for the fractional share less the holder's
proportionate adjusted basis in such fractional share, or (ii) recognize
dividend income in an amount not in excess of the amount of proceeds received
from the sale of the fractional share.

3. The aggregate tax basis of the New Common Stock received by a
stockholder pursuant to the Reverse Split will equal the aggregate tax basis of
the stockholder's Class A Common Stock prior to the Effective Date (except that
such basis will be reduced by any basis allocated to a fractional share
redeemed by the Company with respect to which the stockholder recognizes gain
or loss as described in clause (i) of paragraph 2 above). The holding period
of the New Common Stock received by the stockholder will include the holding
period of the stockholder's Class A Common Stock before the Reverse Split,
provided the shares of Class A Common Stock were a capital asset in the hands
of such stockholder.

Special taxation and withholding rules may apply to any stockholder
that is a nonresident alien or a foreign corporation. Those rules are beyond
the scope of this discussion and should be discussed with a personal tax
advisor. Stockholders will be required to provide their social security or
other taxpayer identification numbers (or, in some instances, certain other
information) to the transfer agent in connection with the Reverse Stock Split
to avoid backup withholding requirements that might otherwise apply. See
"Exchange of Certificates and Liquidation of Fractional Shares." The letter of
transmittal will require each stockholder to deliver such information when the
Class A Common Stock certificates are surrendered following the Effective Date
of the Amendment. Failure to provide such information may result in backup
withholding.

UPDATING OF EXEMPTIONS TO RESTRICTIONS ON ISSUANCE OF STOCK

At the Special Meeting of Stockholders on July 6, 1992 at which the
Principal Stockholder's initial purchase of Class A Common Stock was approved,
the stockholders authorized an amendment adding Article Fifteenth to the
Certificate to protect the Principal Stockholder's interests by limiting the
Company's ability to issue additional securities and thus dilute his ownership
position. Article Fifteenth provides that the Company may not issue any
securities without the approval of the stockholders or of a unanimous Board of
Directors, except for (a) issuance of the Class A Common Stock (1) upon the
exercise of options under the Company's 1982 Incentive Stock Option Plan and
1982 Stock Option Plan (the "1982 Option Plans"), which options were
outstanding as of July 13, 1992, (2) upon the conversion of Series B Preferred
Stock, or (3) upon the exercise of warrants outstanding as of July 13, 1992;
and (b) issuance of the Class A Common Stock upon conversion of Series B
Preferred Stock. Article Fifteenth became effective on July 13, 1992.

Since the date of this amendment, additional options were issued under
the 1982 Option Plans, the 1982 Option Plans have expired, and the Company has
adopted, subject to the stockholders' approval of PROPOSAL FIVE, new option
plans similar in purpose to the 1982 Option Plans. In addition, since July
1992, the Company has issued 900,000 shares of Series C Preferred Stock
convertible into Class A Common Stock and Warrants. In order to permit the
exercise of Warrants and the exercise of post-July 13, 1992 options without
having to call a meeting of the Board of Directors for each such conversion or
exercise, the Company is proposing to amend Article Fifteenth (shown as Article
Fourteenth in the Amended and Restated Certificate of Incorporation attached as
Appendix D) to (a) permit the exercise without specific Board or stockholder
approval of warrants to purchase Class A Common Stock which are outstanding as
of April 29, 1994 (which, assuming PROPOSAL TWO is approved, would be the
date of the mandatory conversion of outstanding Series C Preferred Stock into
shares of Class A Common Stock and Warrants), and (b) permit the exercise
without specific Board or stockholder approval of options issued under the 1982
Option Plans or the New Option Plans, in accordance with the terms of the
options, regardless of the date such options were granted. The reference to
the Class B common Stock will be deleted pursuant to the reclassification of
Class B Common Stock as and into Class A Common Stock. Approval of the

-52-
<PAGE> 59

unanimous Board of Directors or of the stockholders of the Company would still
be required for each new issuance of Preferred Stock or Warrants after April
29, 1994 and, subject to the exceptions in Article Fifteenth, as amended, for
each new issuance of Class A Common Stock.

CHANGE IN COMPANY NAME AND RESTATEMENT OF CERTIFICATE OF INCORPORATION

As part of PROPOSAL FOUR, the Company is proposing to change the name
of the Company to "The San Francisco Company." The Company believes that this
name is simpler and easier for the public to use than "The Bank of San
Francisco Company Holding Company," will increase identification of the Company
with its Bay Area target market, and will better allow the Company to market
itself as a provider of services in addition to traditional retail banking
services. The Company also believes that the amendments to its Certificate of
Incorporation described in this PROPOSAL FOUR present an ideal opportunity to
incorporate the various amendments to the Certificate over the years into a
single Restated Certificate of Incorporation that will be easier to use both
for the Company and for the several constituencies that may be interested in
reviewing the Certificate of Incorporation.

RIGHTS OF DISSENTING STOCKHOLDERS

-53-
<PAGE> 60

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR
PROPOSAL FOUR: AUTHORIZATION OF AMENDMENT AND
RESTATEMENT OF CERTIFICATE OF INCORPORATION

PROPOSAL FIVE: AUTHORIZATION OF THE ISSUANCE OF ADDITIONAL
SHARES OF CLASS A COMMON STOCK, WARRANTS AND RIGHTS

INTRODUCTION

As discussed above, the Company is attempting to raise additional
capital in order to obtain greater assurance that the Company an the Bank will
be able to meet their minimum capital requirements on an on-going basis in the
coming months and as a precaution against prolonged or increased uncertainty in
the economy in general and the real estate market in particular. In addition,
the Company is seeking to raise capital in order to initiate the Bank's new
strategic focus and permit management to pursue perceived opportunities both
domestically and in the Asian markets which is discussed in the Company's 1993
Annual Report. The Company is seeking to raise net proceeds of a minimum of
$15,000,000 and a maximum of approximately $23,500,000 (if the entire allotment
for oversubscription is sold) of such additional capital in the Private
Placement. Because of the regulatory considerations discussed above, the Board
of Directors of the Company believes it is critical to the Company and the Bank
to raise a substantial portion of this additional capital as soon as possible.

The Company and the Bank have retained the Placement Agents to assist
and advise the Company with respect to the Company's capital raising efforts.
The Company has prepared and is the process of distributing a private placement
memorandum in connection with the Private Placement. See "Background" for
additional information regarding the regulatory position of the Company and the
Bank and the need for the Private Placement.

DESCRIPTION OF UNITS

In the Private Placement, the Company is offering for sale up to
7,222,222 units (the "Units"), each consisting of (i) one share of Class A
Common Stock, (ii) one warrant, entitling the holder thereof to purchase one
share of Class A Common Stock at a purchase price of $5.00 per share (the
"Warrants"), and (iii) one right entitling the holder thereof to receive,
without payment of additional consideration, an amount of shares of Class A
Common Stock in periodic distributions based upon the resolution value of
certain problem assets currently held in the Bank's portfolio (the "Rights").
The purpose of the Right is to insulate the investors in the Offering, to a
limited extent, from the effects on the Company and the Bank of deteriorations
in the value of the Company's problem assets. The Company is offering the
Units at a price of $3.60 per Unit (the "Unit Price"). The foregoing assumes
approval of the 1-for-10 reversal stock split described in PROPOSAL FOUR.
ASSUMING (I) THE SALE OF THE MINIMUM NUMBER OF UNITS IN THE PRIVATE PLACEMENT,
BUT (II) NO EXERCISE OF ANY OF THE WARRANTS OR THE UNIT WARRANTS AND (III) NO
SHARES ARE ISSUED PURSUANT TO THE RIGHTS, THE SHARES ISSUED IN THE PRIVATE
PLACEMENT WILL REPRESENT 51.0% OF THE TOTAL NUMBER OF OUTSTANDING CLASS A
COMMON STOCK AFTER THE PRIVATE PLACEMENT.

RIGHTS. Management has identified assets (each, a "Specified Asset")
currently held in the Bank's portfolio that have given rise to losses, or that
management believes pose a significant risk of loss, to the Bank. Such
Specified Assets include non-performing loans held in the Bank's portfolio,
real estate classified by the Bank as "other real estate owned" (primarily
resulting from foreclosed loans) and real estate acquired by the Bank through
real estate development and investment activity, in each case where such loans
or real estate assets have an outstanding principal balance or carrying value
on the Bank's financial statements, respectively, in excess of $100,000. The
approximate amount of such Specified Assets was $56.0 million as of January 31,
1994. The Bank's asset carrying value of each Specified Asset is referred to
as its "Specified Asset Value."

-54-
<PAGE> 61

All Specified Assets have been included as part of an asset portfolio
(the "Specified Asset Pool," with the aggregate Specified Asset Value of the
Specified Assets in the Specified Asset Pool on any given date being referred
to below as the "Specified Asset Pool Value"). The purpose of the Rights is to
protect investors purchasing Units in the Private Placement (the "New
Investors"), to a defined extent, for unanticipated losses and related expenses
incurred in the administration, carrying and resolution of such problem assets.
The Rights will effectuate this risk allocation by compensating the New
Investors with additional shares of Class A Common Stock ("Adjustment Shares"),
up to a maximum number of shares per Right (the "Maximum Adjustment"), without
payment of additional consideration by the New Investors, as net losses in
respect of the resolution of the Specified Assets, and as the costs of
administering and carrying the Specified Assets, are incurred by the Bank with
respect to the Specified Asset Pool. The aggregate number of Adjustment Shares
included in the Maximum Adjustment for all Rights included in the Units is
approximately 2,700,000 Adjustment Shares if the minimum amount of Units is
sold in the Private Placement and approximately 4,200,000 Adjustment Shares if
the maximum amount of Units is sold in the Private Placement assuming a book
value of $0.36 per share of Class A Common Stock and the sale of such shares at
such book value.

This compensation will be effected through periodic distributions
(each, an "Interim Distribution") of Adjustment Shares made with respect to each
six-month period during the period from the Initial Closing Date to December
31, 1995 (the "Initial Distribution Period"), except that the initial Interim
Distribution shall be made with respect to the period ending on December 31,
1994 (each, an "Adjustment Period," and the date of each Interim Distribution,
an "Interim Distribution Date"), unless the Maximum Adjustment is distributed
or all Specified Assets are resolved before December 31, 1995. Issuances of
Adjustment Shares will not be made in respect of losses in relation to the
carrying cost of the Specified Assets on the Bank's books and administrative
and carrying cost expenses until such losses and expenses exceed (on a
cumulative basis) the reserves on the Bank's books that are allocated to the
Specified Assets (estimated to be between $5.0 and $6.0 million). Thereafter,
Adjustment Shares will be issued to compensate for losses and expenses up to a
cumulative amount of $12 million (including the allocated reserves). Expenses
attributable to a particular Specified Asset (such as legal and appraisal
expenses) will be recognized upon the resolution of the Specified Asset to
which such expenses relate. Accordingly, New Investors will be protected, to a
defined extent, from further reductions in the book value of their aggregate
investment through the acquisition, for no additional consideration, of a
larger equity interest in the Company. However, because the market value of an
investor's Class A Common Stock may be dependent upon the trading price of such
stock on the AMEX or on such other market on which the Company's stock may
trade, and because the Company can have no control over the trading price of
its stock, the market value of an investor's Adjustment Shares from time to
time may nevertheless not fully compensate such investor for the pro rata
portion of the loss of the Bank's book value against which the Rights are
intended to provide protection.

While management's current intention is to resolve the Specified
Assets on an asset-by-asset basis, management is also exploring other
alternatives, including the potential disposition of part or all of the
Specified Asset Pool to a single buyer. This resolution alternative could be
effected by selling the entire Specified Asset Pool to investors or to a
special purpose entity. In connection with such sale, it is anticipated that
the special purpose entity would issue debt and equity to provide funding for
the orderly liquidation and resolution of the Specified Assets, and a portion
of the proceeds of such sales by the special purpose entity would be paid to
the Bank as consideration for the Specified Asset Pool. Management expects
that if this alternative resolution were undertaken, it could entail further
write-downs of the Specified Assets by the Bank in recognition of the
administrative expenses and the costs of financing assumed by the buyer,
together with the requirement imposed by a typical buyer in such transactions
that it be able to achieve a substantial return on its investment. If such
write-downs were necessary, additional Adjustment Shares (up to the Maximum
Adjustment) would be issued pursuant to the Rights, and the Rights would mature
upon the consummation of such disposition. Mr. Putra Masagung has indicated
that he might invest in such an entity, either alone or together with his
brother, Mr. Oka Masagung, but has made no commitment to do so.

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<PAGE> 62

If, upon the expiration of the Initial Distribution Period, (i)
Specified Assets having an aggregate Specified Asset Value in exces of
two-thirds of the Specified Asset Pool Value on the final closing date of the
Private Placement have been liquidated or otherwise resolved, (ii) all the
Specified Assets have been resolved or (iii) the number of shares issued in
prior Interim Distributions equals the Maximum Adjustment (each, a "Termination
Condition" and collectively, the "Termination Condition"), the Rights will
mature and no further distributions will be made in respect thereof. If,
however, upon the expiration of the Initial Distribution Period, none of the
Termination Conditions has been satisfied, the maturity of the Rights will be
extended for an additional six-month Adjustment Period, and for one final
six-month Adjustment Period thereafter if none of the Termination Conditions
has been satisfied after the first such extension period expires. If the
Rights have matured but the Maximum Adjustment has not been distributed, a
final distribution of Adjustment Shares (the "Final Distribution") will take
place following an appraisal of all remaining Specified Assets. The number of
Adjustment Shares issued in the Final Distribution will be based upon the
difference between the appraised value and the Specified Asset Pool Value on
the date of such Final Distribution (the "Final Distribution Date") (together
with a charge for defined administrative and carrying costs), with such
difference deemed to represent the loss incurred by the Bank with respect to
such remaining Specified Assets.

In calculating the amount of aggregate loss for any Interim
Distribution, if a Specified Asset is liquidated at a price above its Specified
Asset Value, the surplus will be netted against deficits incurred in the
liquidation of other Specified Assets at prices below their Specified Asset
Values, as well as against defined carrying and administrative costs. Any net
surplus will be carried over and applied against net deficits, if any, incurred
in respect of subsequent Adjustment Periods. However, even if such surpluses
exceed net deficits incurred in respect of one or more of such Adjustment
Periods, Adjustment Shares that have already been issued pursuant to the
Interim Distributions will not be subject to forfeiture or return to the
Company.

The number of Adjustment Shares that may be acquired on any Interim
Distribution Date or the Final Distribution Date by any one "person" (as that
term is used in rule 13d-3 under the Securities Exchange Act of 1934, as
amended) including persons acting together as a group, will be limited to not
more than the number of Adjustments Shares issuable pursuant to the Rights
included in the Units purchased by the purchaser of the largest number of Units
in the Offering, but in any event not more than the number of Adjustment Shares
issuable in respect of the Rights purchased as part of Units whose purchaser
would hold 10% of the shares in Class A Common Stock outstanding immediately
after the completion of the Offering.

WARRANTS. The Company will issue, in respect of each Unit purchased
in the Offering, a Warrant to purchase one share of Class A Common Stock at a
purchase price of $5.00 per share (the "Exercise Price") (after giving effect
to the 1-for-10 reverse stock split described in PROPOSAL FOUR). Each Warrant
will permit the holder thereof to exercise, in whole or in part, the purchase
rights represented by the Warrant on or before December 31, 1995.

REGISTRATION RIGHTS. Holders of (i) Class A Common Stock issued
pursuant to the Private Placement, (ii) Adjustment Shares and (iii) Class A
Common Stock acquired by exercise of the Warrants (collectively, "Registerable
Securities") will be entitled to certain registration rights in respect of such
Registerable Securities. The Company anticipates that it will file a
registration statement for the purpose of registering a secondary offering by
the holders of the Registerable Securities and certain other persons, including
the Principal Stockholder, as referred to in PROPOSAL TWO above.

There can be no assurance that any such registration statement will
become effective or that it will be effective at any particular time. If such a
registration statement does become and remains effective, the holders of such
shares of Class A Common Stock and Warrants would be able to sell them from
time to time as they deem appropriate, in the open market or otherwise, which
would increase the "float" of the Class A Common Stock (i.e., the number of
shares that can trade without restriction in the public capital markets).
Sales pursuant to such a secondary offering would not increase the Company's
capital.

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<PAGE> 63

POTENTIAL DILUTIVE IMPACT OF PRIVATE PLACEMENT

The Private Placement will have a substantial dilutive impact on the
percentage of ownership of the current holders of the Company's equity
securities. FOLLOWING THE CONVERSION OF ALL THE CURRENTLY OUTSTANDING SHARES
OF SERIES C PREFERRED STOCK INTO CLASS A COMMON STOCK AND WARRANTS, AND
ASSUMING (i) THE SALE OF THE MINIMUM NUMBER OF UNITS IN THE PRIVATE PLACEMENT,
BUT (ii) NO EXERCISE OF ANY OF THE WARRANTS OR THE UNIT WARRANTS AND (iii) NO
SHARES ARE ISSUED PURSUANT TO THE RIGHTS, THE SHARES ISSUED IN THE PRIVATE
PLACEMENT WILL REPRESENT 51.0% OF THE TOTAL NUMBER OF OUTSTANDING CLASS A
COMMON STOCK AFTER THE PRIVATE PLACEMENT.

The following table sets forth the relative percentage ownership of
the Company's Class A Common Stock following the conversion of the 900,000
shares of Series C Preferred Stock and assuming (i) the sale of Units in the
Private Placement, as set forth in the table (ii) no exercise of any of the
Warrants or the Unit Warrants and (iii) no shares are issued pursuant to the
Rights.

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<PAGE> 64

Percentage of Class A Common Stock (1)

<TABLE>
<CAPTION>
Purchasers Current Public
Dilution Event Masagung (2) Latief in the Stockholders
Offering
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Minimum Offering
Amount Attained 45.4% 0% 51.0% 3.6%

Maximum Offering Amount
Plus Allotment for 35.5% 0% 61.7% 2.8%
Oversubscriptions

Latief Purchase and
Maximum Offering Amount 25.3% 10.2% 61.7% 2.8%
Plus Allotment for
Oversubscriptions
</TABLE>

(1) Based on a Unit Price of $3.60.

(2) Assumes that neither Mr. Putra Masagung nor Mr. Latief
purchase Units in the Offering.

RIGHTS OF DISSENTING STOCKHOLDERS

Under the Delaware General Corporation Law, stockholders of the
Company are not entitled to any rights of appraisal or dissenters rights in
connection with the adoption of PROPOSAL FIVE: AUTHORIZATION OF THE ISSUANCE
OF ADDITIONAL SHARES OF CLASS A COMMON STOCK.

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<PAGE> 65

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR
PROPOSAL FIVE: AUTHORIZATION OF THE ISSUANCE OF ADDITIONAL
SHARES OF CLASS A COMMON STOCK, WARRANTS AND RIGHTS

PROPOSAL FIVE: APPROVAL OF THE 1993 EXECUTIVE STOCK
OPTION PLAN AND THE 1993 STOCK OPTION PLAN

The Board of Directors of the Company believes that a stock option
incentive program is an important factor in attracting, retaining, and
motivating highly qualified employees who will dedicate their productive
efforts towards the advancement of the interests of the Company and the Bank.

In 1982, the Board of Directors and the stockholders of the Company
adopted and approved an incentive stock option plan and a non-qualified stock
option plan which were in effect until February, 1992 when they expired by
their terms. See "Executive Compensation - Description of Benefit Plans." The
Board of Directors has approved and is submitting to the stockholders for
approval the 1993 Executive Stock Option Plan (the "Executive Plan") and the
1993 Non-Employee Directors Stock Option Plan (the "Directors Plan"). Options
granted under the Executive Plan may be either incentive stock options which
qualify for favorable tax treatment to the optionee, or non-qualified stock
options which do not qualify for favorable tax treatment to the optionee but
may be granted on terms and conditions that are more varied than for incentive
stock options. The two plans are regarded by the Board of Directors as
complementary parts of a single stock option incentive program and thus are
presented together for stockholder consideration.

The Executive Plan will cover a total of 11,000,000 shares of Class A
Common Stock, and the Directors Plan will cover a total of 500,000 shares of
Class A Common Stock. If PROPOSAL FOUR with respect to the Reverse Split is
approved, the Executive Plan and the Non-Incentive Plan (collectively, the "New
Option Plans") will cover 1,100,000 and 50,000 shares of Class A Common Stock,
respectively. In each case, the number of options available for grant is
subject to adjustment to prevent dilution. Each option granted under either of
the New Option Plans must be evidenced by a stock option agreement between the
Company and the optionee.

The employment agreements which the Company has entered into with
Messrs. Price and Champion, as described in PROPOSAL ONE-Employment Contracts
and Termination of Employment and Change-in-Control Arrangements, provide that
the Board of Directors shall, subject to stockholder approval of this PROPOSAL
FIVE, grant each of Messrs. Price and Champion options under the Executive Plan
to acquire shares of the Company's Class A Common Stock equal to 4% of the
fully-diluted shares of Class A Common Stock, with additional options to be
granted in the future as necessary to maintain the 4% ratio. The effective
date of the initial grant of options to Messrs. Price and Champion would be
September 30, 1993. For purposes of determining the number of fully-diluted
shares, Warrants would not be counted until they become exercisable. Based on
the current capitalization of the Company, if this PROPOSAL FIVE is approved,
each of Mr. Price and Mr. Champion would receive options to purchase 1,976,615
shares of the Company, effective September 30, 1993.

The options granted to Messrs. Price and Champion would vest over a
ten-year period, with 25% vesting on the first anniversary of the employment
agreements, 15% vesting on each of the three following anniversaries, and 5%
vesting annually thereafter until all options have vested. The exercise price
of the options to be granted effective September 30, 1993 would be $0.50 per
share (the effective price of the September Investment by the Principal
Stockholder) (without giving effect to the 1-for-10 reverse stock split
described in PROPOSAL FOUR), and the exercise price of subsequent anti-dilution
options would be the then-current fair market value of the Class A Common
Stock.

Other than options to be granted to Messrs. Price and Champion under
their Employment Agreements, and automatic grants to non-employee directors
under the Directors Plan, the Board of Directors is unable to determine

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<PAGE> 66
at this time the number and value of any stock options that will be granted in
the future under the New Option Plans to other participants. Awards under the
Executive Plan will be discretionary and will be based on the performance of
the Company, the officer's job performance, the importance of his or her
position, and his or her contribution to the organization's goals for the award
period (which goals in the short term are likely to focus more on capital
raising, compliance with regulatory requirements, and improvements in financial
performance than on financial performance comparative to other bank holding
companies).

Set forth below are descriptions of the principal terms and conditions
of the New Option Plans. The following descriptions are summaries and do not
purport to be fully descriptive and reference should be made to the actual New
Option Plans for more detailed information. Copies of the Executive Plan and
the Directors Plan are attached to this Proxy Statement as Appendices E and F,
respectively.

ELIGIBILITY TO PARTICIPATE IN PLANS

The Executive Plan

Options under the Executive Plan may be granted to key employees
(including directors who are also employees) and consultants of the Company and
its subsidiaries who are selected at the discretion of the committee of
independent directors (the "Executive Plan Committee") appointed to administer
the Executive Plan. If no Executive Plan Committee is appointed, all of the
independent directors as a group will automatically constitute the Executive
Plan Committee. Independent directors may not receive grants under the
Executive Plan.

The Directors Plan

Options under the Directors Plan are granted to all non-employee
directors of the Company. On April 1, 1994, each non-employee director then
serving shall be granted options to acquire 50,000 shares of Class A Common
Stock (without giving effect to the 1-for-10 reverse stock split described in
PROPOSAL FOUR). Each non-employee director who is newly appointed or elected
subsequent to April 1, 1994 shall, upon the date of such appointment or
election, automatically be granted options covering that number of shares of
Class A Common Stock (exclusive of fractional shares) equal to the product of
50,000 (without giving effect to the 1-for-10 reverse stock split described in
PROPOSAL FOUR) multiplied by a fraction the numerator of which is the number of
days remaining until the following April 1, and the denominator of which is
365. Each non-employee director who receives an initial grant of options
under the Directors Plan on April 1, 1994 or thereafter and is serving on the
subsequent April 1 shall automatically be granted options to acquire 25,000
shares of Class A Common Stock (without giving effect to the 1-for-10 reverse
stock split described in PROPOSAL FOUR).

PURCHASE PRICE OF SHARES ISSUABLE UPON EXERCISE OF OPTIONS

The Executive Plan

The exercise price of options under the Executive Plan must be the
fair market value of the shares of the Company's Class A Common Stock as of the
date the option is granted, except that the exercise price of an incentive
stock option granted to a holder of 10% of the voting power of the Company must
be no less than 110% of fair market value. The fair market value of shares
will be the price which the Executive Plan Committee, acting in good faith,
determines would apply to a sale of Class A Common Stock between a willing
buyer and a willing seller, in accordance with the terms of the Executive Plan.

The Directors Plan

The exercise price of options under the Directors Plan will be the
fair market value of the shares of the Company's Class A Common Stock as of the
date of grant. The fair market value will be the closing sale price of a share
of Class A Common Stock as reported on the AMEX, another stock exchange or the
National

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<PAGE> 67
Association of Securities Dealers Automated Quotation System or, if shares of
Class A Common Stock are no longer traded on a stock exchange or on NASDAQ,
the average of the bid and asked prices in over-the-counter trading.

PAYMENTS UNDER THE PLANS

All shares purchased pursuant to an option under the Executive Plan
must be paid for in cash. All shares purchased pursuant to an option under the
Directors Plan must be paid for in cash or by tendering shares of the Class A
Common Stock, or a combination thereof, upon exercise of the option. Shares
tendered are valued at their fair market value on the date of exercise.

TERMS OF OPTIONS AND EXERCISABILITY

The terms of options granted under the Executive Plan may not exceed
ten years, provided that in the case of a holder of 10% of the voting power of
the Company, the exercise of an incentive stock option shall not be permitted
more than five years after the date of grant. The Executive Plan Committee has
the right to provide for the vesting of options in installments and at such
times and subject to the satisfaction of such conditions as it may determine.

Options granted under the Directors Plan will have a term of ten
years. One-half of the number of any options granted under the Directors Plan
will be exercisable upon the expiration of one full year of service as a
non-employee director following the date of grant, and the remaining one-half
will become exercisable upon the expiration of two years from the date of
grant.

TRANSFER OF OPTIONS

Options granted under either of the New Option Plans are not
transferable except by will or the laws of descent. Therefore, during the
lifetime of an option holder, an option may be exercised only by the option
holder (or his or her personal representative in the case of disability).

TERMINATION OF EMPLOYMENT OR DIRECTOR STATUS

In the event that the holder of options under the Directors Plan
ceases to be a director for any reason, all options held by the holder that are
not exercisable within 30 days after the date of such termination shall expire.
All options exercisable within 30 days after termination shall be exercisable
until the earlier to occur of (a) one year from termination, or (b) five years
from the date of grant.

In the event of termination of employment, all options granted under
the Executive Plan may be exercised only as provided in the option agreement
between the Company and the optionee. In the event of termination for a reason
other than death or disability, incentive stock options must be exercised
within no more than three months after termination. In the event of
termination as a result of death or disability, incentive stock options must be
exercised within twelve months after termination.

DILUTION AND OTHER ADJUSTMENTS

With respect to both New Option Plans, if the number of shares of the
Company's Class A Common Stock is increased or decreased or if such shares are
changed into a different security, with or without consideration, through a
corporate reorganization, stock split or similar transaction, the number of
shares subject to options and the exercise price shall be adjusted accordingly.

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<PAGE> 68
FEDERAL INCOME TAX CONSIDERATIONS

The Executive Plan

Options granted under the Executive Plan may be either incentive stock
options in accordance with the provisions of Section 422 of the Internal
Revenue Code of 1986, as amended, or non-qualified stock options that do not
meet the requirements of Section 422. In the case of an incentive stock
option, the optionee will realize no taxable income upon either the grant or
exercise of an incentive stock option, nor will the Company obtain any
deduction from its taxable income. Upon subsequent disposition of shares
acquired pursuant to the exercise of an incentive stock option, if the shares
have not been disposed of prior to two years from the date of grant nor within
one year from the date of exercise, the excess, if any, of the sales price of
the shares upon disposition over the exercise price of the option will be
treated as long-term capital gain to the optionee.

If the shares acquired pursuant to the exercise of an incentive stock
option are disposed of prior to the expiration of the required holding period,
the optionee realizes ordinary income to the extent of the lesser of the
excess, if any, of the fair market value of the shares on the date of exercise
over the exercise price of the option or the gain realized on sale, and the
Company will be allowed a deduction to the extent of the ordinary income
recognized by the optionee. In addition, if the shares have been held for more
than 12 months, the excess, if any, of the sales price of the shares upon
disposition over the fair market value of the shares on the date of exercise
will be treated as long-term capital gain to the optionee; if the shares have
been held for 12 months or less, the excess, if any, of the sales price of the
shares upon disposition over the fair market value of the shares on the date of
exercise will be treated as short-term capital gain to the optionee.

Upon the grant of a non-qualified option, no taxable income will be
realized by the optionee nor will any deduction from the Company's taxable
income be allowed. Upon the exercise of a non-qualified stock option, the
excess, if any, of the fair market value of the shares on the date of exercise
over the exercise price of the option will be treated as ordinary income to the
optionee, and the Company will be allowed a deduction to the extent of the
ordinary income recognized by the optionee, assuming the Company complies with
applicable federal income tax withholding requirements. Upon subsequent
disposition of shares acquired pursuant to the exercise of a non-qualified
stock option, if the shares have been held for more than 12 months, the excess,
if any, of the sales price of the shares upon disposition over the fair market
value of the shares on the date of exercise will be treated as long-term
capital gain to the optionee; if the shares have been held for 12 months or
less, the excess, if any, of the sales price of the shares upon disposition
over the fair market value of the shares on the date of exercise will be
treated as short-term capital gain to the optionee.

The Non-Incentive Plan

All options granted under the Non-Incentive Plan will be treated for
federal income tax purposes as non-qualified stock options.

ADMINISTRATION, MODIFICATION AND TERMINATION OF THE PLANS

The Executive Plan is administered by the Executive Plan Committee,
which is composed of non-employee directors. The Directors Plan is
administered by the Board of Directors. The New Option Plan administrators
administer the New Option Plans in accordance with the terms and conditions
thereof, interpret the New Option Plans and make appropriate determinations
under the New Option Plans, including as to the Executive Plan the employees
to whom options shall be granted, the number of options to be granted to each
employee, the exercise price of each option, any vesting period or other
conditions to exercise and the period during which each option may be
exercised. Awards under the Executive Plan will be discretionary based on
employees' job performance, contribution to the Company's goals for the award
period, and the importance of the employee's position to the Company, except
that the Company has agreed to grant to each of Messrs. Price and Champion
options under the Executive Plan to purchase up to 4% of the fully-diluted
Class A Common Shares of the Company.

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<PAGE> 69
The New Option Plan Committees may amend the New Option Plans, except
that stockholder approval is required to (i) increase the number of shares
available under the New Option Plans other than for anti-dilution purposes, or
(ii) reduce the exercise prices of options granted thereunder below those
specified in the New Option Plans. The Directors Plan may not be amended more
than once every six months.

The Executive Plan and the Directors Plan will both terminate in 2003
unless earlier terminated. Upon termination of each New Option Plan, no more
options may be granted under such New Option Plan, although termination will
not affect the options previously granted under the New Option Plan.

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<PAGE> 70

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR
PROPOSAL SIX: APPROVAL OF THE 1993 EXECUTIVE STOCK
OPTION PLAN AND THE 1993 NON-INCENTIVE STOCK OPTION PLAN

PROPOSAL SEVEN: RATIFICATION OF SELECTION
OF INDEPENDENT ACCOUNTING FIRM FOR 1993 AND 1994

The firm of KPMG Peat Marwick, independent public accountants, was
appointed in June 1990 to audit the books and records of the Company and the
Bank for 1990 and also audited the books and records of the Company and the
Bank in 1991, 1992 and 1993. Audit services performed by KPMG Peat Marwick
during 1992 and 1993 consisted of examining financial statements, preparing
management letters and tax returns and consulting on accounting matters.

The selection of an independent accounting firm to provide audit
services for the Company has been approved annually by the Company's Board of
Directors. The Board desires to have KPMG Peat Marwick continue as the
independent accounting firm for the Company for the current 1994 fiscal year.
Accordingly, stockholders are being asked to act upon a proposal to ratify the
Board of Directors' selection of KPMG Peat Marwick for both 1993 and 1994. If
stockholders do not approve this proposal, the Board of Directors will
reconsider its selection of an accounting firm.

KPMG Peat Marwick has advised the Company that one or more of its
representatives will be present at the Annual Meeting to make a statement if
they so desire and to respond to appropriate questions.

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<PAGE> 71
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR
PROPOSAL SIX: RATIFICATION OF SELECTION
OF INDEPENDENT ACCOUNTING FIRM

STOCKHOLDER PROPOSALS

The deadline for stockholders to submit proposals to be considered for
inclusion in the Company's proxy statement and form of proxy for the 1995
annual meeting of stockholders is -------- --, 1995.

OTHER PROPOSED ACTION

The Board of Directors is not aware of other business which will come
before the Annual Meeting, but if any such matters are properly presented,
proxies solicited hereby will be voted, at the proxy holder's discretion, upon
the direction of management. All shares represented by duly executed proxies
will be voted at the Annual Meeting.

<TABLE>
<S> <C>
BANK OF SAN FRANCISCO COMPANY HOLDING COMPANY

LINDA M. TANNER
Assistant Secretary
</TABLE>

San Francisco, California
April 4, 1994

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