EXHIBIT 10.3


                              EMPLOYMENT AGREEMENT


     This Employment Agreement (the "Agreement") made as of this 8th day of
     January, 1997, by and between MICHAEL J. GRIFFIN, an individual
     residing at 12 Spruce Run Road, Glen Gardner, New Jersey 08826 (the
     "Employee") and STATEWIDE SAVINGS BANK, S.L.A., a New Jersey chartered
     capital stock savings and loan association with its principal place of
     business located at 70 Sip Avenue, Jersey City, New Jersey 07306
     ("Bank"). 

     WHEREAS, the Bank wishes to hire Employee to serve in the capacity set
     forth in this Agreement on the terms and conditions set forth in this
     Agreement;

     WHEREAS, the Employee agrees to be employed pursuant to the terms and
     conditions of this Agreement; 

     NOW, THEREFORE, in consideration of the premises and covenants
     contained herein, and with the intent to be legally bound hereby, the
     parties hereto hereby agree as follows:

          1.   EMPLOYMENT.  The Bank hereby agrees to employ the Employee,
     and the Employee hereby accepts such employment, upon the terms and
     conditions set forth herein. The parties acknowledge that Employee is
     accepting this employment at the request of Statewide Financial Corp.,
     the sole shareholder of the Bank.

          1.   POSITION AND DUTIES.  The Employee shall be employed as the
     President and Chief Operating Officer of the Bank, to perform such
     services in that capacity as are usual and customary for comparable
     institutions, under the direction and supervision of the Chief
     Executive Officer of the Bank.  

          1.   CASH COMPENSATION.   The Bank shall pay to the Employee
     compensation for his services as follows:

               (a)  Base Salary.  The Employee shall be entitled to
     receive, commencing upon the date of this Agreement, an annual base
     salary (the "Base Salary") of $155,000, which shall be payable in
     installments in accordance with Bank's usual payroll method.  Annually
     thereafter, on or prior to the anniversary date of this Agreement, the
     Board of Directors of the Bank shall review the Employee's
     performance, the status of Bank and such other factors as the Board of
     Directors or a committee thereof shall deem appropriate, and shall
     adjust the Base Salary accordingly. 

               (b)  Discretionary Bonus.  Prior to commencement of this
     Agreement, the Employee and the Chief Executive Officer of the Bank
     shall meet and establish performance criteria for the Employee in
     writing.  The Employee shall be entitled to receive annually (on or
     before the anniversary date of this Agreement) a cash bonus, the
     amount to be determined by the Board of Directors or a committee
     thereof, in an amount up to 30% of the Base Salary; the actual amount
     of the bonus will be based upon the Employee's partial or total
     satisfaction of the agreed upon criteria as well as the Bank's overall
     performance.  The Employee and the Chief Executive Officer of Bank
     shall meet annually on or prior to the anniversary date of the
     Employment Agreement to review the Employee's performance and to
     mutually agree upon new performance criteria for the upcoming year.

          1.   OTHER BENEFITS.

               (a)  Supplemental Retirement Plan. Bank shall immediately
     establish a supplemental retirement plan (the "SRP") for the benefit
     of the Employee in form and amount similar to SRPs provided to other
     executive officers of Bank, other than the Chief Executive Officer of
     Bank.

               (b)  Fringe Benefits.  The Bank shall buy out Employee's
     lease on that certain 1996 Buick Park Avenue currently used by
     Employee.  During the term of this Agreement, all carrying, gasoline,
     repair and maintenance charges for such automobile shall be fully and
     promptly paid by the Bank.  The Employee shall be entitled to the
     exclusive and unlimited use of an automobile of a type and style
     commensurate with the Employee's status as President and Chief
     Operating Officer of the Bank.  In addition, the Employee shall be
     entitled to receive hospital, health, disability, medical and life
     insurance of a type currently provided to and enjoyed by other senior
     officers of the Bank, and shall be entitled to participate in any
     other employee benefit or retirement plans offered by the Bank to its
     employees generally or to its senior management.

               (c)  Recognition and Retention Plan.  The Employee shall be
     entitled to participate in and receive grants under the Statewide
     Financial Corp. Recognition and Retention Plan for Executive Officers
     and Employees (the "RRP").  Employee shall receive a grant of 23,012
     shares of Restricted Stock (as that term is defined in the RRP).  Such
     grant shall be subject to all of the terms and conditions, including
     vesting, contained in the RRP, and Employee shall be bound by all of
     the terms of the RRP with regard to the grant of such shares.  This
     grant of shares may be increased from time to time in the sole
     discretion of Statewide Financial Corp.

               (d)  Stock Option Plan.  The Employee shall be entitled to
     participate in the Statewide Financial Corp. 1996 Incentive Stock
     Option Plan (the "Option Plan").  Pursuant to the Option Plan,
     Employee will receive options to purchase 31,700 shares of Statewide
     Financial Corp. Common Stock.  Such option grant shall be subject to
     all of the terms and conditions of the Option Plan, including vesting,
     and Employee shall be bound by all of such terms and conditions.

          1.   TERM.  The initial term of this Agreement shall be two
     years, commencing upon the date hereof and continuing until January 7,
     1999.

          1.   TERMINATION.

               (a)  Cause.  As used in this Agreement, the term "Cause"
     shall mean the Employee's personal dishonesty, incompetence,  willful
     misconduct, breach of fiduciary duty involving personal profit,
     intentional failure to perform stated duties, willful violation of any
     law, rule or regulation (other than traffic violations or similar
     offenses) or final cease-and-desist order, or a material breach of any
     provision of this Agreement.  Employee's death or "disability" (as
     that term is defined in the Option Plan) shall not be considered
     "Cause" hereunder.  Notwithstanding the above, the Employee shall not
     be deemed to have been terminated for Cause unless and until there
     shall have been delivered to him a copy of a resolution duly adopted
     by the affirmative vote of not less than three-fourths of the members
     of the Board of Directors of the Bank at a meeting of its Board called
     and held for that purpose (after reasonable notice to the Employee and
     an opportunity for him, together with counsel, to be heard before such
     Board of Directors), finding that in the good faith opinion of the
     Board of Directors, the Employee was guilty of conduct justifying
     termination for Cause and specifying the particulars thereof in
     detail.

               (b)  Termination With Cause.  The Bank shall have the right
     to terminate the Employee for Cause, upon written notice to him of
     such determination as described above, specifying the alleged Cause. 
     In the event of such termination, the Employee shall not be entitled
     to any further benefits under this Agreement.

               (c)  Termination Without Cause.  If the Bank terminates the
     Employee's employment hereunder without Cause prior to the end of the
     term of this Agreement, the Employee shall be entitled to receive his
     then current Base Salary through the remaining term of this Agreement. 
     Such payment may be made over the remaining term of this Agreement in
     periodic payments in the same manner in which the Employee's salary
     was paid through the time of such termination, or by a lump sum
     payment of the discounted present value of all Base Salary payments
     through the remaining term of this Agreement (calculated using the
     interest yield then applicable to a Treasury Note with a maturity
     equal to the remaining term).  The determination of the method of
     payment shall be made mutually by the Bank and the Employee; provided,
     however, that in the event the parties cannot agree on the method of
     payment, Bank shall be entitled to choose.  The Bank shall continue to
     provide the Employee with hospital, health, medical and life
     insurance, and any other benefits in effect at the time of such
     termination through the end of the term of this Agreement.  In
     addition, the Bank shall provide Employee with outplacement
     assistance, to include an office and a secretary at the premises of
     the outplacement service provider, for a period of three (3) months
     after such termination.  The Employee shall have no duty to mitigate
     damages in connection with his termination by the Bank without Cause. 
     However, if the Employee obtains new employment and such new
     employment provides for hospital, health, medical and life insurance,
     and other benefits, in a manner substantially similar to the benefits
     payable by the Bank hereunder, the Bank may permanently terminate the
     duplicative benefits it is obligated to provide hereunder.
     Notwithstanding anything else above, in the event Employee is
     terminated without cause, Employee shall receive his then current Base
     Salary as provided for in the first two sentences of this Section.

               (d)  Suspension and Special Regulatory Rules.
               
                    (i)  If the Employee is suspended and/or temporarily
     prohibited from participating in the conduct of the affairs of the
     Bank by a notice served under Section 8(e)(3) or Section 8(g)(1) of
     the Federal Deposit Insurance Act ("FDI Act"), the Bank's obligations
     under this Agreement shall be suspended as of the date of service,
     unless stayed by appropriate proceedings.  If all charges in the
     notice are dismissed, Bank shall pay Employee all compensation
     withheld while Employer's contractual obligations were suspended.

                    (ii) If the Employee is removed and/or permanently
     prohibited from participating in the conduct of the affairs of the
     Bank by an order issued under Section 8(e)(4) or Section 8(g)(1) of
     the FDI Act, all obligations of the Bank under this Agreement shall
     terminate as of the effective date of the order and the Employee shall
     not be entitled to receive the payments provided for under Paragraph
     (c) above.  All vested rights of Employee shall not be affected.

                    (iii)     If Bank is in default, as defined in Section
     3(x)(1) of the FDI Act, all obligations of the Bank under this
     Agreement shall terminate as of the date of default.  All vested
     rights of Employee shall not be affected.

                    (iv) All obligations of the Bank under this Agreement
     shall be terminated, except to the extent it is determined that
     continuation of this Agreement is necessary for the continued
     operation of Bank, (1) by the Director of the Office of Thrift
     Supervision ("Director"), or his or her designee, at the time the
     Federal Deposit Insurance Corporation enters into an agreement to
     provide assistance to or on behalf of the Bank under the authority
     contained in Section 13(c) of the FDI Act, or (2) by the Director, at
     the time the Director or his or her designee approves a supervisory
     merger to resolve problems related to operation of Bank or when Bank
     is determined to be in an unsafe or unsound condition.  All vested
     rights of Employee shall not be affected.

          1.   RESIGNATION FOR CAUSE.

               During the term of this Agreement, the Employee shall be
     entitled to resign from his employment with the Bank, and receive the
     payments provided for below, in the event that the Employee is not in
     breach of this Agreement and Bank (i) reassigns the Employee to a
     position of lesser rank or status than Chief Operating Officer, (ii)
     relocates the Employee's principal place of employment by more than
     thirty miles from its location on the date hereof, (iii) reduces the
     Employee's compensation or other benefits, unless such reduction is
     part of an overall salary reduction program applicable to three (3) or
     more executive employees of the Bank.  Upon the occurrence of any of
     these events, the Employee shall have thirty days to provide the Bank
     notice of his intention to terminate this Agreement.  In the event the
     Employee elects to so terminate this Agreement, such termination shall
     be treated as a termination without Cause by Bank under Section 6(c)
     hereof, and the Employee shall be entitled to receive all payments and
     other benefits called for under such Section 6(c).     

          1.   CHANGE IN CONTROL.

               (a)  Upon the occurrence of a Change in Control (as herein
     defined) followed at any time during the term of this Agreement by the
     involuntary termination of the Employee's employment other than for
     Cause, as defined in Section 6(a) hereof, or, as provided below, upon
     the voluntary termination of the Employee within eighteen months of
     such Change in Control.  Employee shall be entitled to receive a
     payment equal to two times his then current Base Salary.  At the
     election of the Bank, such payment may be made either in a lump sum
     payment equal to the discounted present value of such payment
     (calculated using the interest rate then applicable to two year
     Treasury Notes) or paid monthly in equal installments during the
     twenty-four (24) months following such termination.  During such
     twenty-four (24) month period, the Bank shall continue to provide the 
     Employee with hospital, health, medical and life insurance, and any
     other benefits in effect at the time of such termination.  In
     addition, the Bank shall provide Employee with outplacement
     assistance, to include an office and a secretary at the premises of
     the outplacement provider, for a period of three (3) months after such
     termination.  Upon the occurrence of a Change in Control, the Employee
     shall have the right to elect to voluntarily terminate his employment
     within eighteen months of such Change in Control following any
     demotion, loss of title, office or significant authority, reduction in
     his annual compensation or benefits, or relocation of his principal
     place of employment by more than thirty miles from its location
     immediately prior to the Change in Control.

               (b)  A "Change in Control"  shall mean:

               (1)  a reorganization, merger, consolidation or sale of all
                    or substantially all of the assets of Statewide
                    Financial Corp. (the "Company"), or a similar
                    transaction in which the Company is not the surviving
                    entity; or

               (2)  individuals who constitute the Incumbent Board (as
                    herein defined) of the Company cease for any reason to
                    constitute a majority thereof; or 

               (3)  a change in control within the meaning of 12 C.F.R.
                    574.4; or

               (4)  (a) an event of a nature that would be required to be
                    reported in response to Item I of the current report on
                    Form 8-K, as in effect on the date hereof, pursuant to
                    Section 13 or 15(d) of the Securities Exchange Act of
                    1934 (the "Exchange Act"), or results in a change in
                    control of Bank or the Company within the meaning of
                    the Home Owners' Loan Act of 1933 and the Rules and
                    Regulations promulgated by the Office of Thrift
                    Supervision or its predecessor agency, as in effect on
                    the date hereof; or 

               (5)  Without limitation, a change in control shall be deemed
                    to have occurred at such time as (i) any "person" (as
                    the term is used in Section 13(d) and 14(d) of the
                    Exchange Act) other than the Company or the trustees of
                    a Bank sponsored employee stock ownership plan and
                    trust or any other employee benefit plan of the Bank
                    established from time to time is or becomes a
                    "beneficial owner" (as defined in Rule 13-d under the
                    Exchange Act) directly or indirectly, of securities of
                    the Company representing 25% or more of the Company's
                    outstanding securities ordinarily having the right to
                    vote at the election of directors; or

               (6)  A proxy statement soliciting proxies from stockholders
                    of the Company is disseminated by someone other than
                    the current management of the Company, seeking
                    stockholder approval of a plan of reorganization,
                    merger or consolidation of the Company or similar
                    transaction with one or more corporations as a result
                    of which the outstanding shares of the class of
                    securities then subject to the plan or transaction are 
                    exchanged or converted into cash or property or
                    securities not issued by the Company;

               (7)  A tender offer is made for 25% or more of the voting
                    securities of the Company and the shareholders owning
                    beneficially or of record 25% or more of the
                    outstanding securities of the Company have tendered or
                    offered to sell their shares pursuant to such tender
                    offer and such tendered shares have been accepted by
                    the tender offeror.

               For these purposes, "Incumbent Board" means the Board of
     Directors of the Company on the date hereof, provided that any person
     becoming a director subsequent to the date hereof whose election was
     approved by a vote of at least three-quarters of the directors
     comprising the Incumbent Board, or whose nomination for election by
     members or stockholders was approved by the same nominating committee
     serving under an Incumbent Board, shall be considered as though he
     were a member of the Incumbent Board.

          1.   COVENANT NOT TO COMPETE.

               Employee agrees that during the term of his employment
     hereunder and for a period of six (6) months after the termination of
     his employment for any reason other than pursuant to Section 8 above,
     he will not in any way, directly or indirectly, manage, operate,
     control, accept employment or a consulting position with or otherwise
     advise or assist or be connected with or own or have any other
     interest in or right with respect to (other than through ownership of
     not more than five percent (5%) of the outstanding shares of a
     corporation whose stock is listed on a national securities exchange or
     on the National Association of Securities Dealers Automated Quotation
     System) any enterprise which competes with Bank in any line of
     business conducted by the Bank or the Company during such employment
     or on the date of such termination in the market areas served by the
     Bank's branches on the date of Employee's termination.  In the event
     that this covenant not to compete shall be found by a court of
     competent jurisdiction to be invalid or unenforceable as against
     public policy, such court shall exercise discretion in reforming such
     covenant to the end that Employee shall be subject to a covenant not
     to compete that is reasonable under the circumstances and enforceable
     by Bank.  Employee agrees to be bound by any such modified covenant
     not to compete.

          1.   MISCELLANEOUS.

               (a)  Governing Law.  This Agreement shall be governed by and
     interpreted under the substantive law of the State of New Jersey.

               (b)  Severability.  If any provision of this Agreement shall
     be held to be invalid, void, or unenforceable, the remaining
     provisions hereof shall in no way be affected or impaired, and such
     remaining provisions shall remain in full force and effect.

               (c)  Entire Agreement; Amendment.  This Agreement sets forth
     the entire understanding of the parties with regarding to the subject
     matter contained herein and supersedes any and all prior agreements,
     arrangements or understandings relating to the subject matter hereof
     and may only be amended by written agreement signed by both parties
     hereto or their duly authorized representatives. 
                                                                           
               (d)  Obligations Unconditional.  Bank's obligation to pay
     Employee his compensation and provide his benefits as described in
     this Agreement shall be absolute and unconditional and shall not be
     affected by any circumstance, including, without limitation, any set
     off, counterclaim, recoupment, defense or other right which Bank may
     have against Employee or anyone else.

               (e)  Continuing Obligations.  Sections 6 through 9 of this
     Agreement shall continue and survive the termination of Employee's
     employment with Bank.


          IN WITNESS WHEREOF, the parties hereto have executed this
     Agreement as of the date first above written.

                                   STATEWIDE SAVINGS BANK, S.L.A.


                               By:
                                   Victor M. Richel, Chairman and
                                    Chief Executive Officer



                         EMPLOYEE:
                                   MICHAEL J. GRIFFIN