Exhibit 3.1

                AMENDED AND RESTATED CERTIFICATE OF INCORPORATION

                                       OF

                      WEBSTER PREFERRED CAPITAL CORPORATION

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

                        Pursuant to Section 33-801 of the
                      Connecticut Business Corporation Act
                   ------------------------------------------

     Webster Preferred Capital  Corporation (the  "Corporation"),  a corporation
organized  and  existing  under the  Connecticut  Business  Corporation  Act, as
amended, and having its principal office in the State of Connecticut at 145 Bank
Street, Waterbury, Connecticut 06702,

     DOES HEREBY CERTIFY:

          FIRST:  The  name of the  Corporation  is  Webster  Preferred  Capital
Corporation.  The  Corporation  desires to amend and  restate  its  amended  and
restated certificate of incorporation as currently in effect.

          SECOND:  The  Corporation's   Amended  and  Restated   Certificate  of
Incorporation  set  forth  below  contains  amendments   requiring   shareholder
approval.

          THIRD: This Amended and Restated Certificate of Incorporation was duly
approved  in  accordance  with  Sections  33-801 and  33-797 of the  Connecticut
Business Corporation Act, as amended, by the Corporation's Board of Directors by
unanimous written consent dated December 17, 1997 and by the sole shareholder of
the Corporation by written consent dated December 17, 1997.

          FOURTH: The text of the Corporation's amended and restated certificate
of  incorporation  as currently in effect is hereby  amended and restated in its
entirety as follows:


                                    ARTICLE I
                                      NAME

     The name of the corporation is Webster Preferred  Capital  Corporation (the
"Corporation").





                                      -1-






<PAGE>

                                   ARTICLE II
                    REGISTERED OFFICE AND AGENT; INCORPORATOR

     The registered office of the Corporation shall be located at One Commercial
Plaza,  Hartford,  Connecticut 06103. The registered agent of the Corporation at
such address shall be CT Corporation System. The name of the Incorporator of the
Corporation is Josephina Rotman Childress and the address of the Incorporator is
53 State Street, Boston, Massachusetts 02109.


                                   ARTICLE III
                               PURPOSES AND POWERS

     The  Corporation is being formed to engage in the real estate  business and
to engage in any other  lawful act or  activity  for which  corporations  may be
organized  under the  Connecticut  Business  Corporation  Act,  as amended  (the
"Connecticut  Business  Corporation Act"). The foregoing purposes shall be in no
way limited or restricted by reference to, or inference  from,  the terms of any
other clause of this Amended and Restated  Certificate  of  Incorporation  (this
"Certificate of Incorporation"),  and each shall be regarded as independent. The
foregoing  purposes are also to be construed as powers of the  Corporation,  and
shall  be in  addition  to  and  not in  limitation  of the  general  powers  of
corporations   under   the   laws  of  the   State  of   Connecticut.   However,
notwithstanding  the foregoing and any other  provision of this  Certificate  of
Incorporation,  the  Corporation  may be  operated  solely  for the  purpose  of
performing functions which Webster Bank is empowered to perform directly.


                                   ARTICLE IV
                                  CAPITAL STOCK

SECTION 4.1    AUTHORIZED SHARES.

     The total number of shares which the  Corporation  shall have the authority
to issue is 3,001,000  shares,  consisting  of (i) 1,000 shares of common stock,
par value $.01 per share (the  "Common  Stock"),  and (ii)  3,000,000  shares of
serial preferred stock, par value $1.00 per share (the "Preferred Stock").

     Subject  to  the   limitations   prescribed  by  applicable  law  and  this
Certificate of Incorporation,  the Board of Directors, or if then constituted, a
duly authorized  committee thereof,  is authorized to issue, from authorized but
unissued  shares of capital stock of the  Corporation,  Preferred  Stock in such
series as the  Board of  Directors  may  establish,  from  time to time,  and to
determine  the  preferences,  limitations  and  relative  rights of each  series
thereof (if any).




                                      -2-




<PAGE>

     A certificate of amendment,  which shall be effective  without  shareholder
action,  relating  to each  series  of  Preferred  Stock  shall  set  forth  the
preferences  and other terms of such series,  including  without  limitation the
following:  (1) the title and stated  value,  if any,  of such  series,  (2) the
number of shares of such series and the liquidation preference per share of such
series; (3) the dividend rate(s),  period(s) and/or payment date(s) or method(s)
of  calculation  thereof  applicable to such series;  (4) whether such series is
cumulative  or not,  and if  cumulative,  the date from which  dividends on such
series shall accumulate;  (5) the provision for a sinking fund, if any, for such
series; (6) the provision for redemption, if applicable, of such series; (7) the
relative  ranking  and  preferences  of such  series  as to any  limitations  on
issuance of any series of Preferred  Stock ranking senior to or on a parity with
each  series  of  Preferred   Stock  as  to  dividend  rights  and  rights  upon
liquidation,  dissolution or winding up of the affairs of the  Corporation;  (8)
any voting rights of such series; and (9) any other specific terms, preferences,
rights, limitations or restrictions of such series.

     The terms, limitations and relative rights and preferences of each class of
shares and series thereof (if any) are as follows:

SECTION 4.2    COMMON STOCK.

     4.2.1     DIVIDEND RIGHTS

     Subject  to  Section  4.3.1  hereof,  the Board of  Directors  may  declare
dividends on the Common Stock payable out of assets of the  Corporation  legally
available  therefor,  and the  holders of the Common  Stock shall be entitled to
receive such dividends if, when and as declared by the Board of Directors of the
Corporation.

     4.2.2     LIQUIDATION RIGHTS

     In the event of any voluntary or involuntary liquidation,  dissolution,  or
winding up of, or any distribution of assets of the  Corporation,  after payment
to the  holders  of all  series of the  Preferred  Stock  the full  preferential
amounts  to which  such  holders  are  entitled,  the  remaining  assets  of the
Corporation after payment of all debts and liabilities of the Corporation, shall
be distributed to the holders of the Common Stock, according to their respective
shares.

     4.2.3     VOTING RIGHTS

     Unless   otherwise   provided  by  this  Certificate  of  Incorporation  or
applicable  law,  all  right  to  vote  and all  voting  power  incident  to the
Corporation's  capital stock shall be vested  exclusively  in the holders of the
Common  Stock,  subject to the rights of the holders of any series of  Preferred
Stock to elect  directors under  specified  circumstances.  Each share of Common
Stock  shall  have one vote on  matters  to be voted  upon by  holders of Common
Stock.
                                      -3-
<PAGE>


SECTION 4.3    SERIAL PREFERRED STOCK.

     4.3.1     DIVIDEND RIGHTS

     The holders of shares of Preferred  Stock shall be entitled to receive from
the  assets of the  Corporation  legally  available  therefor,  if,  when and as
declared  by the  Board of  Directors  of the  Corporation,  dividends  and,  if
applicable,  any accrued and unpaid  dividends  thereon,  in accordance with the
respective terms of the series creating such shares of Preferred  Stock,  before
any dividends shall be declared or paid (other than dividends  payable in shares
of stock of the Corporation) on the Common Stock.

     4.3.2     LIQUIDATION RIGHTS

     In the event of any voluntary or  involuntary  liquidation,  dissolution or
winding up of, or any distribution of the assets of the Corporation, the holders
of  Preferred  Stock  shall be entitled  to be paid the  respective  liquidation
preference,  and if applicable,  any accrued and unpaid  dividends  thereon,  in
accordance  with the  respective  terms of the series  creating  such  shares of
Preferred  Stock,  before any  distribution is made to the holders of the Common
Stock.

     4.3.3     VOTING RIGHTS

     Except  as  otherwise   specifically   provided  in  this   Certificate  of
Incorporation  or required by applicable law, the holders of the Preferred Stock
shall have no right to vote at any  meeting of  shareholders  or  otherwise  and
shall not be entitled to notice of any such meeting,  except in each case as may
be specifically required by law.


                                    ARTICLE V
                               BOARD OF DIRECTORS

SECTION 5.1    BOARD OF DIRECTORS.

     The Board of  Directors  shall  consist of not less than  three  directors.
Subject to the rights of the holders of any series of  Preferred  Stock to elect
directors under specified circumstances,  the number of directors shall be fixed
from time to time pursuant to  resolutions  adopted by the Board of Directors of
the Corporation, as provided in the By-Laws.

SECTION 5.2    LIMITATION ON LIABILITY OF DIRECTORS.

     The personal liability of a director to the Corporation or the shareholders
of the Corporation  for monetary  damages for breach of duty as a director shall
be limited to an amount that is not less than the  compensation  received by the
director for serving the  Corporation  during the year of the  violation if such
breach  did not

                                      -4-

<PAGE>

(A) involve a knowing and culpable violation of law by the director,  (B) enable
the director or an associate,  as defined in Section  33-840 of the  Connecticut
Business  Corporation  Act, to receive an improper  personal  economic gain, (C)
show a lack of good faith and a conscious disregard for the duty of the director
to the Corporation under  circumstances in which the director was aware that his
conduct or  omission  created  an  unjustifiable  risk of serious  injury to the
Corporation,  (D)  constitute a sustained and unexcused  pattern of  inattention
that amounted to an abdication of the director's duty to the Corporation, or (E)
create  liability under Section 33-757 of the Connecticut  Business  Corporation
Act.


                                   ARTICLE VI
                          COVENANTS OF THE CORPORATION

     The Corporation hereby covenants as follows:

     (a) The  Corporation  shall not file a  voluntary  petition  of  bankruptcy
without the approval of two-thirds of the Board of Directors of the Corporation.

     (b) The   Corporation   will:  (i)  prepare  and  maintain   its  financial
statements,   transactions,  books  and  records,  corporation  documents,  bank
accounts  and other  assets  separate  from those of any other person or entity;
(ii) maintain  separate offices through which its business is conducted  (except
that the  Corporation  may lease office space on the premises of Webster Bank as
may be necessary to the Corporation's operations);  (iii) be adequately financed
and  capitalized  as a  separate  unit in  light of the  reasonably  foreseeable
obligations  of a business  of its size and  character;  (iv)  maintain an arms'
length relationship with affiliates and any other parties furnishing services to
it; (v) maintain its books,  records,  resolutions  and  agreements  as official
records;  (vi)  conduct  its  business  in its  own  name;  (vii)  pay  its  own
liabilities out of its own funds and other assets,  (viii) observe all corporate
formalities  necessary  to  maintain  its  identity  as an entity  separate  and
distinct from Webster Bank, all other affiliates and any other person or entity,
(ix) hold  appropriate  meetings  of its Board of  Directors  to  authorize  its
corporate actions; (x) participate in the fair and reasonable  allocation of any
and all overhead  expenses and other common  expenses for  facilities,  goods or
services provided to multiple  entities;  (xi) use its own stationery,  invoices
and  checks;  (xii)  hold  itself out to the  public  and  identify  itself as a
separate and distinct entity under its own name and not as a division or part of
any person or entity; and (xiii) hold its assets in its own name.

         (c) All borrowings by the  Corporation  will indicate that Webster Bank
has not  guaranteed  the debt of the  Corporation  unless that is, in fact,  the
case.

         (d)  The   Company   will   not:   (i)  fail  to   correct   any  known
misunderstanding  regarding its separate  identity;  (ii) commingle its funds or
other assets with those of any other person or entity;  (iii) assume,  guarantee
or became obligated for the debts
                                      -5-
<PAGE>

of any  affiliate  or other  entity  (other than a  subsidiary)  or hold out its
credit as being  available to satisfy the  obligations of any affiliate or other
entity (other than a subsidiary);  (iv) acquire obligations or securities of its
shareholders  (except  for the  acquisition  by the  Corporation  of mortgage or
mortgage-related  assets from  Webster  Bank);  (v) pledge any of its assets (or
permit any of its assets to be pledged)  for the benefit of any other  person or
entity; (vi) identify its shareholders or any of its affiliates as a division or
part of it; (vii) engage  (either as transferor or  transferee)  in any material
transaction with any affiliate other than for fair value and on terms similar to
those obtainable in arms' length  transactions  with  unaffiliated  parties,  or
engage in any  transaction  with any  affiliate  involving any intent to hinder,
delay or defraud any person or entity; or (viii) engage in any business activity
other than as permitted by this Certificate of Incorporation.

     (e) To the extent that the  statements  set forth in  Sections  (b) and (d)
above of this  Article  VI relate to the  separate  business  operations  of the
Corporation  and Webster Bank,  such statements are qualified to the extent that
Webster Bank,  in its capacity as Servicer  under the Master  Service  Agreement
between the  Corporation  and  Webster  Bank and as Advisor  under the  Advisory
Service  Agreement  between the  Corporation  and Webster Bank, is authorized to
take,  and does take,  action on behalf of the  Corporation in order properly to
perform its duties and responsibilities under those agreements.  Such statements
are also qualified to the extent that for accounting and reporting purposes, the
Corporation may be included in the consolidated  financial statements of Webster
Bank or Webster  Financial  Corporation in accordance  with  generally  accepted
accounting principles.


                                   ARTICLE VII
                      LIMITATIONS ON OWNERSHIP AND TRANSFER

     (a) CERTAIN DEFINITIONS.

     The following terms shall have the following meanings:

     (1) "Acquire" shall mean the acquisition of Beneficial  Ownership of shares
of Capital Stock by any means  including,  without  limitation,  (i) a Transfer,
(ii) the  acquisition  of direct  ownership  of shares by any Person,  including
through the exercise of Acquisition Rights or any other option, warrant, pledge,
other  security  interest  or  similar  right to acquire  shares,  and (iii) the
acquisition   of  indirect   ownership  of  shares   (taking  into  account  the
constructive  ownership rules of Section 544 of the Code, as modified by Section
856(h)(1)(B) of the Code) by a Person who is an individual within the meaning of
Section  542(a)(2)  of the Code,  including,  without  limitation,  through  the
acquisition by any Person of Acquisition Rights or any option, warrant,  pledge,
security  interest,  or similar right to acquire shares.  The term "Acquisition"
shall have the correlative meaning.




                                      -6-
<PAGE>

     (2)  "Acquisition  Rights"  shall mean rights to Acquire  shares of Capital
Stock pursuant to: (i) exercise of any option to acquire shares of Capital Stock
or (ii) any pledge of shares of Capital Stock.

     (3) "Beneficial  Ownership" shall mean ownership of shares of Capital Stock
by a Person who is treated or would be treated as an owner of such Capital Stock
either  directly or indirectly,  or  constructively  through the  application of
Section 544 of the Code, as modified by Section  856(h)(1)(B)  of the Code.  The
terms "Beneficial  Owner,"  "Beneficially  Owns" and "Beneficially  Owned" shall
have the correlative meanings.

     (4) "Capital  Stock"  shall mean all classes or series of capital  stock of
the Corporation  including  without  limitation,  the Common Stock and Preferred
Stock.

     (5) "Charitable  Beneficiary"  shall mean one or more  beneficiaries of the
Trust  as  determined  pursuant  to  Section  7(m),  each of  which  shall be an
organization described in Sections 170(b)(1)(A),  170(c)(2) and 501(c)(3) of the
Code.

     (6) "Code" shall mean the Internal  Revenue Code of 1986,  as amended,  and
the regulations promulgated thereunder.

     (7) "Initial  Public  Offering"  means the closing of the sale of shares of
Preferred  Stock  pursuant to the  Corporation's  first  effective  registration
statement for such Preferred  Stock,  filed under the Securities Act of 1933, as
amended.

     (8) "Market Price" shall mean the net asset value per share of Common Stock
or Preferred Stock, as the case may be, as determined in good faith by the Board
of Directors.

     (9) "Person" shall mean an individual,  corporation,  partnership,  estate,
trust  (including a trust  qualified  under Section  401(a) or 501(c)(17) of the
Code), a portion of a trust  permanently set aside for or to be used exclusively
for the purposes described in Section 642(c) of the Code,  association,  private
foundation within the meaning of Section 509(a) of the Code, joint stock company
or other  entity and also  includes a group as that term is used for purposes of
Section  13(d)(3) of the Securities  Exchange Act of 1934, as amended;  but does
not include an underwriter  which  participates  in a public offering of Capital
Stock for a period of 90 days following the purchase by such  underwriter of the
Capital Stock,  provided that the ownership of Capital Stock by such underwriter
would not result in the  Corporation  being "closely held" within the meaning of
Section 856(h) of the Code, or would otherwise result in the Corporation failing
to qualify as a REIT.

     (10)  "Purported  Beneficial  Transferee"  shall mean,  with respect to any
purported  Transfer  which would  result in a  violation  of Section  7(b),  the
purported  beneficial  transferee for whom the Purported Record Transferee would
have  acquired  shares of Capital  Stock if such  Transfer  had not violated the
provisions  of

                                      -7-
<PAGE>

Section  7(b).  The Purported  Beneficial  Transferee  and the Purported  Record
Transferee may be the same Person.

     (11)  "Purported  Record  Transferee"  shall mean the Person who would have
been the record  holder of the Capital  Stock if such  Transfer had not violated
the  provisions of Section 7(b).  The Purported  Beneficial  Transferee  and the
Purported Record Transferee may be the same Person.

     (12) "REIT" shall mean a "real estate  investment  trust" under Section 856
of the Code.

     (13) "REIT  Provisions  of the Code" means  Sections 856 through 860 of the
Code and any  successor or other  provisions of the Code relating to real estate
investment  trusts  (including  provisions as to the attribution of ownership of
beneficial interests therein) and the regulations promulgated thereunder.

     (14) "Restriction Termination Date" shall mean the first day after the date
of the  closing  of  the  Initial  Public  Offering  on  which  the  Corporation
determines that is no longer in the best interests of the Corporation to attempt
to, or continue to, qualify as a REIT.

     (15) "Transfer" shall mean any sale, transfer, gift, assignment,  devise or
other  disposition  of  Capital  Stock that  results in a change in the  record,
Beneficial  Ownership of Capital Stock or the right to vote or receive dividends
on Capital Stock (including without limitation (i) the granting of any option or
entering  into any  agreement  for the sale,  transfer or other  disposition  of
Capital Stock or the right to vote or receive dividends on Capital Stock or (ii)
the sale, transfer,  assignment or other disposition or grant of any Acquisition
Rights  or other  securities  or rights  convertible  into or  exchangeable  for
Capital  Stock,  or the right to vote or receive  dividends  on Capital  Stock),
whether   voluntary  or   involuntary,   whether  of  record,   Beneficially  or
constructively and whether by operation of law or otherwise.

     (16) "Trust" shall mean the trust created pursuant to 7(l) hereof.

     (17) "Trustee" shall mean the Person unaffiliated with the Corporation,  or
the Purported  Beneficial  Transferee,  that is appointed by the  Corporation to
serve as trustee of the Trust.

     (b) RESTRICTIONS.

     During the period commencing on the date of the Initial Public Offering and
prior to the Restriction Termination Date:

          (i)  No Person  shall  Acquire  any shares of  Capital  Stock if, as a
               result  of  such   Acquisition,   the  Capital   Stock  would  be


                                      -8-

<PAGE>


               Beneficially Owned by less than 100 Persons  (determined  without
               reference to any rules of attribution); and

          (ii) No Person shall Acquire or Beneficially Own any shares of Capital
               Stock  if,  as  a  result  of  such   Acquisition  or  Beneficial
               Ownership,  the  Corporation  would be "closely  held" within the
               meaning of Section 856(h) of the Code (without  regard to whether
               the purported  Acquisition,  Transfer, or other event takes place
               during  the second  half of a taxable  year) or  otherwise  would
               result in the corporation failing to qualify as a REIT.

     (c) REMEDIES FOR BREACH.

     (1) If, notwithstanding the other provisions contained in this Article VII,
there is a purported Transfer,  Acquisition,  change in the capital structure of
the Corporation or other event (including,  without limitation,  a change in the
relationship  between two or more Persons that causes the application of Section
544 of the Code,  as modified by Section  856(h)),  that,  if  effective,  would
result in the  violation of one or more of the  restrictions  on  ownership  and
transfer  described  in  Section  7(b),  then (i) in the case of a  Transfer  or
Acquisition,  that number of shares of Capital Stock purported to be Transferred
or Acquired  that  otherwise  would cause such  Person to violate  Section  7(b)
(rounded up to the next whole share)  shall be  automatically  transferred  to a
Trust for the benefit of a Charitable Beneficiary,  as described in Section 7(l)
of  this  Article  VII,  effective  as of the  close  of  business  on  the  day
immediately  prior to the date of such purported  Transfer or  Acquisition,  and
such Person shall acquire no rights in such shares of Capital Stock; (ii) in the
case of any event other than a Transfer or Acquisition (a "Beneficial  Ownership
Event"),  that number of shares of Capital  Stock that would be owned by Persons
(the "Affected  Persons") as a result of such  Beneficial  Ownership  Event that
otherwise  would violate Section 7(b) (rounded up to the next whole share) shall
be  automatically  transferred  to a  Trust  for  the  benefit  of a  Charitable
Beneficiary,  as described in Section 7(l) of this Article VII,  effective as of
the close of business on the day immediately prior to such Beneficial  Ownership
Event,  and such Affected  Person or Persons shall acquire no rights (or have no
continuing  rights) in such shares of Capital Stock; or (iii) if the transfer to
the Trust  described  in either  clause (i) or clause (ii)  hereof  would not be
effective for any reason to prevent any Person from Beneficially Owning Stock in
violation of Section 7(b), then the Transfer,  Acquisition,  or other Beneficial
Ownership  Event that would  otherwise cause such Person to violate Section 7(b)
shall be void ab initio.

     (2)   Notwithstanding   the  other  provisions   hereof,  any  Transfer  or
Acquisition  of shares of Capital Stock that, if effective,  would result in the
Capital  Stock being  beneficially  owned by less than 100  Persons  (determined
without



                                      -9-


<PAGE>


reference to any rules of attribution) shall be void ab initio, and the intended
transferee shall acquire no rights in such shares of Capital Stock.

     (3) In addition  to, and without  limitation  by,  subsections  (1) and (2)
above, if the Board of Directors or its designees shall at any time determine in
good  faith  that a  Transfer,  Acquisition  or other  event has taken  place in
violation of Section 7(b) or that a Person intends to Acquire,  has attempted to
Acquire,  or may Acquire  direct  ownership,  beneficial  ownership  (determined
without  reference to any rules of attribution)  or Beneficial  Ownership of any
Capital  Stock in  violation  of Section  7(b),  the Board of  Directors  or its
designees  shall take such action as it deems advisable to refuse to give effect
to or to prevent such  Transfer or other event,  including,  but not limited to,
causing the Corporation to refuse to give effect to such Transfer or other event
on the books of the  Corporation  or  instituting  proceedings  to  enjoin  such
Transfer or other event;  provided,  however,  that any Transfer or  Acquisition
(or, in the case of events  other than a Transfer or  Acquisition,  ownership or
Beneficial Ownership) in violation of Section 7(b) shall automatically result in
the transfer to the Trust described in Section 7(1),  irrespective of any action
(or non-action) by the Board of Directors.

         (4) Nothing contained in this Section 7(c) shall limit the authority of
the Board of  Directors  to take such  other  action  as it deems  necessary  or
advisable to protect the  Corporation  and the interests of its  shareholders by
preservation of the Corporation's status as a REIT.

         (d)    NOTICE OF RESTRICTED TRANSFER.

         Any Person who  Acquires or  attempts  or intends to Acquire  shares of
Capital  Stock in violation of Section 7(b) or any Person who is a transferee in
a Transfer  or is  otherwise  affected  by an event  other than a Transfer  that
results in a violation of Section 7(b), shall immediately give written notice to
the  Corporation  of such  Transfer  or other  event  and shall  provide  to the
Corporation  such other  information as the  Corporation may request in order to
determine  the  effect,  if any,  of such  Transfer  or  attempted,  intended or
purported Transfer or other event on the Corporation's status as a REIT.

         (e)    OWNERS REQUIRED TO PROVIDE INFORMATION.

         From the date of the closing of the Initial  Public  Offering and prior
to the Restriction Termination Date:

         (1) every  shareholder  of  record  of more  than  0.5% (or such  lower
percentage as required by the Code or regulations promulgated thereunder) of the
number  or  value  of  any  series  of  the  outstanding  Capital  Stock  of the
Corporation  shall,  within 30 days after December 31 of each year, give written
notice  to  the  Corporation  stating  the  name  and  address  of  such  record
shareholder, the number of shares of Capital Stock Beneficially Owned by it, and
a  description  of how such




                                      -10-




<PAGE>

shares of Capital  Stock are held;  provided  that a  shareholder  of record who
holds  outstanding  Capital  Stock of the  Corporation  as nominee  for  another
person,  which other  person is required  to include in gross  income,  for U.S.
federal  income tax purposes,  the dividends  received on such Capital Stock (an
"Actual Owner"),  shall give written notice to the Corporation  stating the name
and address of such Actual  Owner and the number of shares of such Actual  Owner
with respect to which the shareholder of record is nominee.

     (2)  every  Actual  Owner of more than 0.5% (or such  lower  percentage  as
required by the Code or  regulations  promulgated  thereunder)  of the number or
value of any series of the  outstanding  Capital Stock of the Corporation who is
not a  shareholder  of record of the  Corporation,  shall  within 30 days  after
December 31 of each year give written notice to the Corporation stating the name
and  address  of such  Actual  Owner,  the  number of shares  of  Capital  Stock
Beneficially  Owned,  and a description  of how such shares of Capital Stock are
held.

     (3) each person who is a Beneficial Owner or constructive  owner of Capital
Stock and each  Person  (including  the  shareholder  of record)  who is holding
Capital Stock for a Beneficial Owner or constructive  owner shall provide to the
Corporation such  information as the Corporation may request,  in good faith, in
order to determine the Corporation's  compliance with the REIT provisions of the
Code.


     (f) REMEDIES NOT LIMITED.

     Nothing  contained  in this  Article VII shall limit the  authority  of the
Board of Directors to take such other action as it deems  necessary or advisable
to protect the Corporation  and the interests of its  shareholders in preserving
the Corporation's status as a REIT.

     (g) AMBIGUITY.

     In the case of an ambiguity in the  application of any of the provisions of
this Article VII, including any definition  contained in Section 7(a), the Board
of Directors shall have the power to determine the application of the provisions
of this  Article VII with respect to any  situation  based on the facts known to
it.

     (h) LEGEND.

     Each certificate for shares of Capital Stock shall bear  substantially  the
following legend:

          "The  shares   represented   by  this   certificate   are  subject  to
          restrictions  on  transfer  and  ownership  for  the  purpose  of  the
          Corporation's  maintenance  of its status as a Real Estate  Investment
          Trust under the Internal Revenue Code of 1986, as amended.  Subject to
          certain further




                                      -11-
<PAGE>

          restrictions  and except as  expressly  provided in the  Corporation's
          Amended  and  Restated  Certificate  of  Incorporation,  no Person may
          Beneficially  Own shares of Capital Stock of the  Corporation if, as a
          result of such Acquisition or Beneficial Ownership,  the Capital Stock
          would be held by less than 100  Persons.  Any Person who  Beneficially
          Owns or attempts to Beneficially Own shares of Capital Stock in excess
          of the above limitations must immediately notify the Corporation,  any
          shares of Capital  Stock so held may be subject to  mandatory  sale in
          certain events,  certain  purported  acquisitions of shares of Capital
          Stock in excess of such limitations  shall be void ab initio,  and any
          shares of Capital Stock purported to be Acquired or Beneficially Owned
          in excess of such  limitation will be  automatically  transferred to a
          Trust  for the  benefit  of a  Charitable  Beneficiary.  A Person  who
          attempts to  Beneficially  Own shares of Capital Stock in violation of
          the ownership limitations set forth in Section 7(b) of the Amended and
          Restated Certificate of Incorporation of the Corporation shall have no
          claim,  cause of action,  or any other recourse  whatsoever  against a
          transferor of shares.  All  capitalized  terms in this legend have the
          meanings defined in the Corporation's Amended and Restated Certificate
          of  Incorporation,  a copy of which,  including  the  restrictions  on
          transfer,  will be sent  without  charge  to each  shareholder  who so
          requests."

     (i) TERMINATION OF REIT STATUS.

     The Board of Directors shall take no action to terminate the  Corporation's
status as a REIT or to amend the  provisions of this Article VII until such time
as (i) the  Board  of  Directors  adopts  a  resolution  recommending  that  the
Corporation  terminate  its status as a REIT or amend this  Article  VII, as the
case may be, (ii) the Board of Directors presents the resolution at an annual or
special meeting of the  shareholders and (iii) such resolution is approved by at
least a majority of all the votes entitled to be cast on the matter.

     (j) NASDAQ SETTLEMENT.

     Nothing  in  this  Article  VII  shall   preclude  the  settlement  of  any
transaction  with  respect  to the shares of  Capital  Stock of the  Corporation
entered into through the facilities of The Nasdaq Stock Market's National Market
System or such other  securities  exchange on which any of the Capital Stock may
then be traded.  Any transferee in such a transaction shall be subject to all of
the provisions and limitations set forth in this Article VII.



                                      -12-


<PAGE>

     (k) SEVERABILITY.

     If any provision of this Article VII or Section 7(c) or any  application of
any such  provision  is  determined  to be invalid by any Federal or state court
having  jurisdiction  over the issue,  the validity of the remaining  provisions
shall not be affected and other applications of such provision shall be affected
only to the extent necessary to comply with the determination of such court.

     (l) TRANSFER OF STOCK IN TRUST.

     (1) Ownership in Trust;  Status of Shares Held in Trust. Upon any purported
Transfer (whether or not such Transfer is the result of a transaction engaged in
through the facilities of The Nasdaq Stock  Market's  National  Market  System),
Acquisition  or other event that results in the  transfer of Capital  Stock to a
Trust  pursuant to Section 7(b) such shares of Capital  Stock shall be deemed to
have  been  transferred  to the  Trustee  in its  capacity  as  Trustee  for the
exclusive  benefit one or more  Charitable  Beneficiaries.  The Trustee shall be
appointed  by the  Corporation  and  shall  be a  Person  unaffiliated  with the
Corporation, any Purported Beneficial Transferee or Purported Record Transferee.
Each Charitable  Beneficiary  shall be designated by the Corporation as provided
in Section  7(m).  Shares of Capital  Stock so held in Trust shall be issued and
outstanding  stock of the Corporation.  The Purported  Beneficial  Transferee or
Purported Record Transferee shall not benefit economically from ownership of any
shares of Capital  Stock held in Trust by the  Trustee,  shall have no rights to
dividends and shall not possess any rights to vote or other rights  attributable
to the shares held in Trust. The Purported  Record  Transferee and the Purported
Beneficial  Transferee  of shares of Capital  Stock in violation of Section 7(b)
shall have no claim,  cause of action, or any other recourse  whatsoever against
the purported transferor of such shares.

     (2) Dividend  Rights.  The Trustee shall have all rights to dividends  with
respect to shares of Capital  Stock held in the  Trust,  which  rights  shall be
exercised for the exclusive benefit of the Charitable Beneficiary.  Any dividend
or distribution  paid prior to the discovery by the Corporation  that the shares
of Capital  Stock have been  transferred  to the  Trustee  with  respect to such
shares shall be paid over to the Trustee by the  recipient  thereof upon demand,
and any dividend declared but unpaid shall be paid when due to the Trustee.  Any
dividends or  distributions  so paid over to the Trustee  shall be held in trust
for the Charitable Beneficiary.

     (3) Rights upon  Liquidation.  In the event of any voluntary or involuntary
liquidation,  dissolution or winding up of or any  distribution of the assets of
the  Corporation,  the Trustee  shall be entitled to receive,  ratably with each
other holder of Capital  Stock of the class of Capital Stock that is held in the
Trust, that portion of the assets of the Corporation  available for distribution
to the holders of such class (determined based upon the ratio that the number of
shares of such class of Capital  Stock  held by the  Trustee  bears to the total
number of shares of such class


                                      -13-



<PAGE>



of Capital Stock then outstanding). The Trustee shall distribute any such assets
received in respect of the Capital  Stock held in the Trust in any  liquidation,
dissolution or winding up of, or  distribution  of the assets of the Corporation
in accordance with subsection (4) of this Section 7(1).

     (4) Sale of Shares by Trustee.  Within twenty days of receiving notice from
the Corporation that shares of Capital Stock have been transferred to the Trust,
the  Trustee  of the  Trust  shall  sell the  shares  held in Trust to a Person,
designated by the Trustee,  whose  ownership of the shares of Capital Stock held
in the Trust would not violate the  ownership  limitations  set forth in Section
7(b).  Upon such sale, the interest of the Charitable  Beneficiary in the shares
sold shall  terminate and the Trustee shall  distribute  the net proceeds of the
sale to the Purported  Record  Transferee and to the  Charitable  Beneficiary as
provided in this subsection (4). The Purported  Record  Transferee shall receive
the lesser of (1) (x) the price per share such Purported Record  Transferee paid
for the Capital Stock in the purported Transfer that resulted in the transfer of
shares of Capital Stock to the Trust, or (y) if the Transfer or other event that
resulted  in the  transfer  of  shares of  Capital  Stock to the Trust was not a
transaction in which the Purported  Record  Transferee  gave full value for such
shares of Capital Stock, a price per share equal to the Market Price on the date
of the  purported  Transfer or other event that resulted in the transfer of such
shares of Capital Stock to the Trust and (2) the price per share received by the
Trustee from the sale or other  disposition of the shares held in the Trust. Any
net sales  proceeds  in excess of the  amount  payable to the  Purported  Record
Transferee shall be immediately paid to the Charitable Beneficiary. If, prior to
the  discovery  by the  Corporation  that  shares  of  Capital  Stock  have been
transferred  to the  Trustee,  such  shares  are  sold by the  Purported  Record
Transferee,  then (i) such shares shall be deemed to have been sold on behalf of
the Trust and (ii) to the extent that the Purported Record  Transferee  received
an amount  for such  shares  that  exceeds  the  amount  such  Purported  Record
Transferee was entitled to receive  pursuant to this subsection (4), such excess
shall be paid to the Trustee upon demand.  The Trustee should have the right and
power (but not the  obligation)  to offer any share of Capital Stock held in the
Trust for sale to the  Corporation  on such terms and  conditions as the Trustee
shall determine appropriate.

     (5) Voting and Notice Rights.  The Trustee shall have all voting rights and
rights to receive any notice of any  meetings,  which  rights shall be exercised
for the exclusive  benefit of the Charitable  Beneficiary.  The Purported Record
Transferee shall have no voting rights with respect to shares held in Trust.

     (m) DESIGNATION OF CHARITABLE BENEFICIARY.

         By written notice to the Trustee,  the Corporation  shall designate one
or more nonprofit organizations to be the Charitable Beneficiary of the interest
in the Trust such that (i) the shares of Capital  Stock held in the Trust  would
not  violate  the


                                      -14-


<PAGE>


restrictions  set  forth  in  Section  7(b)  in the  hands  of  such  Charitable
Beneficiary and (ii) each Charitable Beneficiary is an organization described in
Sections 170(b)(1)(A), 170(c)(2) and 501(c)(3) of the Code.


                                  ARTICLE VIII
                          CERTAIN BUSINESS COMBINATIONS

     The  "Business   Combination"   provisions  of  the  Connecticut   Business
Corporation Act, Sections 33-840 to 33-845, shall not apply to Webster Financial
Corporation or Webster Bank.


                                   ARTICLE IX
                                 INDEMNIFICATION

     The  Corporation  shall  indemnify the directors,  officers,  employees and
agents of the  Corporation  to the fullest extent  permitted by applicable  law,
including the Connecticut Business Corporation Act, and if applicable, 12 C.F.R.
ss.  545.121,  as may be  amended  from  time to time by the  Office  of  Thrift
Supervision.  Any such  indemnification  shall continue as to any person who has
ceased to be a director, officer, employee or agent and may inure to the benefit
of the heirs, executors and administrators of such a person.

         The Corporation shall indemnify a director for liability, as defined in
subdivision (5) of Section 33-770 of the Connecticut  Business  Corporation Act,
to any person for any action  taken,  or any  failure to take any  action,  as a
director, except liability (a) that involved a knowing and culpable violation of
law by the  director,  (b) enabled the director or an  associate,  as defined in
Section  33-840 of the  Connecticut  Business  Corporation  Act,  to  receive an
improper  personal  gain,  (c)  showed  a lack of  good  faith  and a  conscious
disregard for the duty of the director to the Corporation under circumstances in
which  the  director  was  aware  that  his  conduct  or  omission   created  an
unjustifiable  risk of serious  injury to the  Corporation,  (d)  constituted  a
sustained and unexcused pattern of inattention that amounted to an abdication of
the director's duty to the Corporation,  or (e) created  liability under Section
33-757 of the Connecticut Business Corporation Act.


                                   ARTICLE XI
                    AMENDMENT OF CERTIFICATE OF INCORPORATION

     This  Certificate of  Incorporation  may be amended in accordance  with the
Connecticut Business Corporation Act.


                                      -15-


<PAGE>

                                   ARTICLE XII
                              AMENDMENT OF BY-LAWS

     The  By-Laws  may  provide  that  the  Board  of  Directors  as well as the
shareholders may make, amend or repeal the By-Laws of the Corporation, except as
otherwise  required  by  statute,  by the  By-Laws,  or by this  Certificate  of
Incorporation.



     IN WITNESS WHEREOF,  this Amended and Restated Certificate of Incorporation
has been executed on behalf of the  Corporation  by the  undersigned,  thereunto
duly authorized on this 17th day of December, 1997.



                                                         By  /s/ John V. Brennan
                                                             -------------------
                                                             John V.  Brennan
                                                             President

Attest:   /s/ Gregory S. Madar
          --------------------
          Gregory S.  Madar
          Vice President and Secretary