Filed by Prosperity Bancshares, Inc.
                           Pursuant to Rule 425 under the Securities Act of 1933

                                  Subject Company: Paradigm Bancorporation, Inc.
                                                   Commission File No. 333-46364

                                                           Date: August 16, 2002


In connection with the proposed merger of Paradigm Bancorporation, Inc. into
Prosperity Bancshares, Inc., Prosperity has previously filed with the Securities
and Exchange Commission a registration statement on Form S-4 to register the
shares of Prosperity's common stock to be issued to the shareholders of
Paradigm. Investors and security holders are advised to read the registration
statement and the proxy statement-prospectus included within the registration
statement because they contain important information about Prosperity, Paradigm,
the proposed transaction and the persons soliciting proxies relating to the
merger. Investors and security holders may obtain free copies of these documents
through the website maintained by the SEC at http://www.sec.gov. Free copies of
the proxy statement-prospectus may also be obtained by directing a request by
telephone or mail to Prosperity Bancshares, Inc., 4295 San Felipe, Houston,
Texas 77027, Attn: Investor Relations. Prosperity's telephone number is (713)
693-9300.

The following is a press release issued on August 15, 2002 by Prosperity
concerning its signing of a definitive agreement to acquire First National Bank
of Bay City.