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                                                                    EXHIBIT 10.8

                     ANDOVER BANCORP, INC. STOCK OPTION PLAN

                                                        May 8, 1986
                                                        as amended May 22, 1986,
                                                        January 29, 1987 and
                                                        November 2, 1987

1.   PURPOSE

     This Stock Option Plan (the "Plan") is intended as a performance incentive
for officers and full-time employees of Andover Bancorp, Inc. (the
"Corporation") or its Subsidiaries (as hereinafter defined) to enable the
persons to whom options are granted (the "Optionees") to acquire or increase a
proprietary interest in the success of the Corporation. The Corporation intends
that this purpose will be effected by the granting of "incentive stock options"
("Incentive Options") as defined in Section 422A(b) of the Internal Revenue Code
of 1986, as amended (the "Code"), nonqualified stock options ("Nonqualified
Options") and stock appreciation rights under the Plan. The terms "Subsidiaries"
includes any corporations in which stock possessing fifty percent (50%) or more
of the total combined voting power of all classes of stock is owned directly or
indirectly by the Corporation.

2.   OPTIONS TO BE GRANTED AND ADMINISTRATION

     (a)  Options granted under the Plan may be either Incentive Options or
Nonqualified Options.

     (b)  The Plan shall be administered by a committee (the "Option Committee")
of not less than three directors appointed by the Board of Directors of the
Corporation. None of the members of the Option Committee shall be an officer or
other full-time employee of the Corporation. No person shall serve as a member
of the Option Committee if such person is then eligible, or has been eligible at
any time during the prior twelve months, to receive stock options, or stock
appreciation rights under the Plan or any other option, stock purchase or
similar plan of the Corporation or its Subsidiaries. It is the intention of the
Corporation that the Plan shall be administered, in accordance with the
provisions of Section 4 hereof, in a manner consistent with the provisions of
Rule 16b-3(b) (entitled "Disinterested Administrators") as promulgated by the
Securities and Exchange Commission under the Securities Exchange Act of 1934, as
amended (the "1934 Act"). Action by the Option Committee shall require the
affirmative vote of a majority of all its members.

     (c)  Subject to the terms and conditions of the Plan, the Option Committee
shall have the power:


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          (i)  To determine from time to time the options to be granted to
          eligible persons under the Plan and to prescribe the terms and
          provisions (which need not be identical) of each option granted under
          the Plan to such persons;
          (ii) To construe and interpret the Plan and options granted thereunder
          and to establish, amend, and revoke rules and regulations for
          administration of the Plan. In this connection, the Option Committee
          may correct any defect or supply any omission, or reconcile any
          inconsistency in the Plan, or in any option agreement, in the manner
          and to the extent it shall deem necessary or expedient to make the
          Plan fully effective. All decisions and determinations by the Option
          Committee in the exercise of this power shall be final and binding
          upon the Corporation and Optionees; and
          (iii) Generally, to exercise such powers and to perform such acts as
          are deemed necessary or expedient to promote the best interests of the
          Corporation with respect to the Plan.

3.   STOCK

     (a)  The stock subject to the options granted under the Plan shall be
shares of the Corporation's authorized but unissued common stock, par value $.10
per share (the "Common Stock"). The total number of shares that may be issued
pursuant to options or stock appreciation rights granted under the Plan shall
not exceed an aggregate of 500,000 shares of Common Stock. Such number shall be
subject to adjustment as provided in Section 8 hereof.

     (b)  Whenever any outstanding option under the Plan expires, is cancelled
or is otherwise terminated (other than by exercise), the shares of Common Stock
allocable to the unexercised portion of such option may again be the subject of
options under the Plan, except for options surrendered as provided in Section 7
hereof.

4.   ELIGIBILITY

     (a)  Incentive Options and/or Nonqualified Options may be granted only to
officers and other full-time employees of the Corporation or its Subsidiaries,
including members of the Board of Directors who are also officers or other
full-time employees of the Corporation or its Subsidiaries.

     (b)  No person shall be eligible to receive any option under the Plan, if
at the date of grant such person beneficially owns in excess of ten percent
(10%) of the outstanding Common Stock of the Corporation.


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     (c)  With respect to Incentive Options granted after December 31, 1986, the
aggregate fair market value (determined at the time each respective option is
granted) of the stock with respect to which Incentive Options are exercisable
for the first time by any individual during any calendar year (under all plans
of the Corporation and its parent and subsidiary corporations as defined in
Section 425 of the Code) shall not exceed $100,000. Any option granted in excess
of the foregoing limitation shall be clearly and specifically designated as not
being an Incentive Option.

5.   TERMS OF THE OPTION AGREEMENTS

     Each option agreement shall contain such provisions as the Option Committee
shall from time to time deem appropriate. Option agreements need not be
identical, but each option agreement by appropriate language shall include the
substance of all of the following provisions:

     (a)  EXPIRATION. Notwithstanding any other provision of the Plan or of any
option agreement, each option shall expire on the date specified in the option
agreement, which date shall not be later than the tenth anniversary of the date
on which the option was granted.

     (b)  MINIMUM SHARES EXERCISABLE. The minimum number of shares with respect
to which an option may be exercised at any one time shall be 100 shares, or such
lesser number as is subject to exercise under the option at the time.

     (c)  EXERCISE.

          (i)  Each option shall be exercisable in such installments (which need
     not be equal) and at such times as designated by the Option Committee. To
     the extent not exercised, installments shall accumulate and be exercisable,
     in whole or in part, at any time after becoming exercisable, but not later
     than the date the option expires.

          (ii) In the event of a Change in Control of the Corporation (as
     defined in (f) below), all options outstanding as of the date of such
     Change in Control shall become vested and immediately exercisable.

          (iii) The exercise of options granted hereunder shall be subject to
     the receipt of any prior regulatory approvals that may be required.

     (d)  PURCHASE PRICE. The purchase price per share of Common Stock under
each option shall be not less than the fair market value of the Common Stock on
the date the option is granted. For the purposes of the Plan, the fair market
value of the Common Stock shall be determined in good faith by the Option
Committee.


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     (e)  RIGHTS OF OPTIONEES. No Optionee shall be deemed for any purpose to be
the owner of any shares of Common Stock subject to any option unless and until
(i) the option shall have been exercised pursuant to the terms thereof, (ii) the
Corporation shall have issued and delivered the Shares to the Optionee, and
(iii) the Optionee's name shall have been entered as a stockholder of record on
the books of the Corporation. Thereupon, the Optionee shall have full voting,
dividend and other ownership rights with respect to such shares of Common Stock.

     (f)  CHANGE IN CONTROL. For purposes of the Plan, a "Change in Control"
shall be deemed to have occurred in either of the following events: (i) if there
has occurred a change in control which the Corporation would be required to
report in response to Item 1 of Form 8-K promulgated under the 1934 Act, or, if
such regulation is no longer in effect, any regulations promulgated by the
Securities and Exchange Commission pursuant to the 1934 Act which are intended
to serve similar purposes or (ii) when any "person" (as such term is used in
Section 13(d) and 14(d)(2) of the 1934 Act) becomes a "beneficial owner" (as
such term is defined in Rule 13d-3 promulgated under the 1934 Act), directly or
indirectly, of securities of the Corporation representing twenty-five percent
(25%) or more of the total number of votes that may be generally cast for the
election of directors of the Corporation, and in the case of either (i) or (ii)
above, the Corporation's Board of Directors has not consented to such event by a
two-thirds vote of all of the members of the Board of Directors then in office
adopted prior to such event. In addition, a Change in Control shall be deemed to
have occurred if, as the result of, or in connection with, any tender or
exchange offer, merger or other business combination, sale of assets or
contested election, or any combination of the foregoing transactions, persons
who were directors of the Corporation before such transaction shall cease to
constitute a majority of the Board of Directors of the Corporation or of any
successor institution.

     (g)  TRANSFER. No options or stock appreciation rights shall be
transferable by the Optionee other than by will or the laws of descent and
distribution, and options or stock appreciation rights may be exercised during
the Optionee's lifetime only by the Optionee, or his or her guardian or legal
representative.

6.   METHOD OF EXERCISE; PAYMENT OF PURCHASE PRICE

     (a)  Any option granted under the Plan may be exercised by the Optionee by
delivering to the Option Committee on any business day a written notice
specifying the number of shares of Common Stock the Optionee then desires to
purchase (the "Notice").


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     (b)  Payment for the shares of Common Stock purchased pursuant to the
exercise of an option shall be made either in (i) cash equal to the option price
for the number of shares specified in the Notice (the "Total Option Price"), or
(ii) if authorized by the applicable option agreement, shares of Common Stock of
the Corporation having a fair market value, as determined in good faith by the
Option Committee, equal to or less than the Total Option Price, plus cash in an
amount equal to the excess, if any of the Total Option Price over the fair
market value of such shares of Common Stock.

7.   STOCK APPRECIATION RIGHTS

     (a)  The Option Committee may, but shall not be obligated to, include stock
appreciation rights in any option agreement, on such terms and conditions as it
deems appropriate in each case. Such stock appreciation rights shall permit the
Optionee, at his or her election, to surrender to the Corporation the right to
exercise such option (or portion thereof) in consideration for the payment by
the Corporation of any amount equal to the excess of the fair market value on
the date of such surrender of the shares of Common Stock subject to such option
(or portion thereof) surrendered over the exercise price of such shares. Such
payment may be made, at the discretion of the Option Committee upon the request
of the Optionee, in shares of Common Stock valued at the fair market value
thereof on the date of such surrender or in cash, or any combination thereof.

     (b)  Any election by an Optionee to exercise stock appreciation rights
included in any option agreement by settlement in cash shall be made only during
the period beginning on the third business day following the date of the release
for publication of quarterly or annual financial information and ending on the
twelfth business day following such date. This condition shall be deemed to be
satisfied when the specified financial data appears on or in a wire service,
financial news service or newspaper of general circulation or is otherwise first
made publicly available. No stock appreciation right may be exercised within six
months from the date of grant thereof, except that this limitation shall not
apply in the event that death or disability of the Optionee occurs prior to the
expiration of such six-month period.

     (c)  Any option surrendered as provided in this Section 7 shall be
cancelled by the Corporation and shall not be subject to further grant.

     (d)  The Option Committee shall be authorized hereunder to make payment to
the Optionee in shares of Common Stock only if Section 61 and 83 of the Code
apply to the Common Stock transferred to the Optionee.


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     (e)  Notwithstanding the foregoing, a stock appreciation right may not be
settled in either cash or shares of the Corporation's Common Stock, if such
settlement would result in the settlement of the stock appreciation right not
complying with Rule 16b-3(e) under the Exchange Act or any successor provision
thereto.

8.   ADJUSTMENT UPON CHANGES IN CAPITALIZATION

     (a)  If the shares of the Corporation's Common Stock as a whole are
increased, decreased, changed into or exchanged for, a different number or kind
of shares or securities of the Corporation, whether through merger,
consolidation, reorganization, recapitalization, reclassification, stock
dividend, stock split, combination of shares, exchange of shares, change in
corporate structure or the like, an appropriate and proportionate adjustment
shall be made in the number and kind of shares subject to the Plan and in the
number, kind, and per share exercise price of shares or other securities subject
to unexercised options or portions thereof granted prior to any such change. In
the event of any such adjustment in an outstanding option, the Optionee
thereafter shall have the right to purchase the number of shares or securities
under such option at the per share price or per unit price, as so adjusted,
which the Optionee could purchase for the total purchase price applicable to the
option immediately prior to such adjustment.

     (b)  Adjustments under this Section 8 shall be determined by the Option
Committee and such determinations shall be conclusive. The Option Committee
shall have the discretion and power in any such event to determine and to make
effective provision for acceleration of the time or times at which any option or
portion thereof shall become exercisable. No fractional shares of Common Stock
shall be issued under the plan on account of any adjustment specified above.

9.   EFFECT OF CERTAIN TRANSACTIONS

     In the case of (i) the dissolution or liquidation of the Corporation, (ii)
a reorganization, merger or consolidation in which the Corporation is acquired
by another entity or in which the Corporation is not the surviving corporation,
or (iii) the sale of all or substantially all of the property of the Corporation
to another corporation, the Plan and the options issued hereunder shall
terminate on the effective date of such transaction, unless provision is made in
connection with such transaction for the assumption of options theretofore
granted under the Plan, or the substitution for such options of new options of
the successor corporation or parent thereof, with appropriate adjustment as to
the number and kind of shares and the per share exercise prices, as provided in
Section 8. In the event of such termination, all outstanding options shall be
exercisable in full for at least 15 days prior to the date of such termination
whether or not otherwise exercisable during such period.


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10.  RELEASE OF FINANCIAL INFORMATION

     A copy of the Corporation's annual report to stockholders shall be
delivered to each Optionee at the time such report is distributed to the
Corporation's stockholders. Upon request, the Corporation shall furnish to each
Optionee a copy of its most recent annual report and each quarterly report and
current report filed under the 1934 Act since the end of the Corporation's prior
fiscal year.

11.  AMENDMENT OF THE PLAN

     The Board of Directors may amend the Plan at any time, and from time to
time, subject to any required regulatory approval and to the limitation that,
except as provided in Sections 8 and 9 hereof, no amendment shall be effective
unless approved by the stockholders of the Corporation in accordance with
applicable law and regulations at an annual or special meeting held within
twelve months before or after the date of adoption of such amendment, where such
amendment will:

     (a)  increase the number of shares of Common Stock as to which options may
be granted under the Plan;

     (b)  change in substance Section 4 hereof relating to eligibility to
participate in the Plan;

     (c)  change the minimum option price;

     (d)  increase the maximum term of options provided herein; or

     (e)  otherwise materially increase the benefits accruing to participants
under the Plan.

     Except as provided in Sections 8 and 9 hereof, rights and obligations under
any option granted before any amendment of the Plan shall not be altered or
impaired by such amendment, except with the consent of the Optionee.

12.  NONEXCLUSIVITY OF THE PLAN

     Neither the adoption of the Plan by the Board of Directors nor the
submission of the Plan to stockholders for approval shall be construed as having
created any limitations on the power of the Board of Directors to adopt such
other incentive arrangements as it may deem desirable, including, without
limitation, the granting of stock options otherwise than under the Plan, and
such arrangements may be either applicable generally or only in specific cases.


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13.  GOVERNMENT AND OTHER REGULATIONS; GOVERNING LAW

     (a)  The obligation of the Corporation to sell and deliver shares of Common
Stock with respect to options granted under the Plan shall be subject to all
applicable laws, rules and regulations, including all applicable federal and
state securities laws, and the obtaining of all such approvals by governmental
agencies as may be deemed necessary or appropriate by the Option Committee.

     (b)  The Plan shall be governed by Massachusetts law, except to the extent
that such law is preempted by federal law.

     (c)  The Plan is intended to comply with the provisions of Rule 16b-3
promulgated under the 1934 Act. Any provision inconsistent with such Rule shall
be inoperative and shall not affect the validity of the Plan.

14.  TERMINATION OF GRANTING OF OPTIONS UNDER PLAN

     No option may be granted under the Plan after May 8, 1996, which is the
tenth anniversary of the date the Plan became effective as the Andover Savings
Bank 1986 Stock Option Plan.