Exhibit 10.7

                          CHESTER VALLEY BANCORP, INC.
                       1997 STOCK OPTION PLAN, AS AMENDED


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                           CHESTER VALLEY BANCORP INC.

                       1997 STOCK OPTION PLAN, AS AMENDED

     1. Definitions

          As used in this Plan, the following definitions apply to the terms
indicated below:

          A. "Board" means the Board of Directors of the Company.

          B. "Committee" means the Personnel/Compensation Committee appointed by
the Board from time to time. The Committee shall consist of at least two
persons, who shall be directors of the Company.

          C. "Company" means Chester Valley Bancorp Inc., a Pennsylvania
corporation.

          D. "Disinterested Director" means a director who is a Non-Employee
Director within the meaning of Rule 16b-3 promulgated by the Securities and
Exchange Commission under the Exchange Act or any successor rule or regulation
adopted by the Securities and Exchange Commission.

          E. "Fair Market Value" of a Share on a given day means, if the Shares
are traded in a public market, the average of the last bid and asked prices of a
Share as reported on the principal securities exchange on which the Shares are
then listed or admitted to trading, or as reported on the National Association
of Securities Dealers Automated Quotation System on the business day immediately
preceding the date of grant. If the Shares shall not be so traded, the Fair
Market Value shall be determined by the Committee taking into account all
relevant facts and circumstances.

          F. "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

          G. "Grantee" means a person who is either an Optionee or an
Optionee-Shareholder.

          H "Incentive Stock Option" means an option, whether granted under this
Plan or otherwise, that qualifies as an incentive stock option within the
meaning of Section 422 of the Internal Revenue Code.

          I. "Nonqualified Option" means an Option that is not an Incentive
Stock Option.

          J. "Option" means a right to purchase Shares under the terms and
conditions of this Plan.

          K. "Optionee" means a person other than an Optionee-Shareholder to
whom an option is granted under this Plan.


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          L. "Optionee-Shareholder" means a person to whom an option is granted
under this Plan and who at the time such option is granted owns, actually or
constructively, stock of the Company or of a Parent or Subsidiary possessing
more than ten percent (10%) of the total combined voting power of all classes of
stock of the Company or of such parent or Subsidiary.

          M. "Parent" means any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company if, at the time of
granting an Option, each of the corporations in the unbroken chain (other than
the Company) owns stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in the chain.

          N. "Plan" means this Chester Valley Bancorp Inc. 1997 Stock Option
Plan, as amended, including any amendments to the Plan.

          O. "Share" means a share of the Company's common stock, par value
$1.00 per share, either now or hereafter owned by the Company as treasury stock
or authorized but unissued.

          P. "Subsidiary" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company if, at the time of
granting an Option, each of the corporations in the unbroken chain (other than
the last corporation in the chain) owns stock possessing fifty percent (50%) or
more of the total combined voting power of all classes of stock in one of the
other corporations in the chain.

          Q. Options shall be deemed "granted" under this Plan on the date on
which the Committee or the Board, by appropriate action, approves the grant of
an Option hereunder or on such subsequent date as the Committee or the Board may
designate.

          R. As used herein, the masculine includes the feminine, the plural
includes the singular, and the singular includes the plural.

     2. Purpose

          The purposes of the Plan are as follows:

          A. To secure for the Company and its shareholders the benefits arising
from share ownership by those directors, officers and key employees and
consultants of the Company and its Subsidiaries who will be responsible for the
Company's future growth and continued success. The Plan is intended to provide
an incentive to directors, officers and key employees and consultants by
providing them with an opportunity to acquire an equity interest or increase an
existing equity interest in the Company, thereby increasing their personal state
in its continued success and progress.

          B. To enable the Company and its Subsidiaries to obtain and retain the
services of directors and key employees and consultants, by providing such
directors and key employees and consultants with an opportunity to acquire
Shares under the terms and conditions and in the manner contemplated by This
Plan.


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     3. Plan Adoption and Term

          A. This Plan shall become effective upon its adoption by the Board,
and Options may be issued upon such adoption and from time to time thereafter;
provided, however, that the Plan shall be submitted to the Company's
shareholders for their approval at the next annual meeting of shareholders, or
prior thereto at a special meeting of shareholders expressly called for such
purpose; and provided further, that the approval of the Company's shareholders
shall be obtained within 12 months of the date of adoption of the Plan. If the
Plan is not approved by the affirmative vote of the holders of a majority of all
shares present in per proxy, at a duly called shareholders' meeting at which a
quorum representing a majority voting stock is present in person or by proxy and
voting on this Plan, then this Plan and Options then outstanding under it shall
forthwith automatically terminate and be of no effect.

          B. Subject to the provisions hereinafter contained relating to
amendment or discontinuance, this Plan shall continue to be in effect for ten
(10) years from the date of adoption of this Plan by the Board. No Options may
be granted hereunder except within such period of ten (10) years but Options
granted within such ten (10) year periods may extend beyond the termination date
of this Plan.

     4. Administration of Plan

          A. This Plan shall be administered by the Board or, subject to
Paragraph 4.C below, the Committee. Except as otherwise expressly provided in
this Plan, the Board shall have authority to interpret the provisions of the
Plan, to construe the terms of any Option, to prescribe, amend and rescind rules
and regulations relating to the Plan, to determine the terms and provisions of
Options granted hereunder, and to make all other determinations in the judgment
of the Board necessary or desirable for the administration of the Plan. Without
limiting the foregoing, the Board shall, to the extent and in the manner
contemplated herein, exercise the discretion granted to it to determine to whom
Incentive Stock Options and Nonqualified Options shall be granted, how many
Shares shall be subject to each such Option, whether a Grantee shall be required
to surrender for cancellation an outstanding Option as a condition to the grant
of a new Option, and the prices at which Shares shall be sold to Grantees. The
Board may correct any defect or supply any omission or reconcile any
inconsistency in the Plan or in any Option in the manner and to the extent it
shall deem expedient to carry the Plan into effect and shall be the sole and
final judge of such expediency.

          B. No member of the Board shall be liable for an action taken or
omitted or any determination made by him in good faith relating to the Plan, and
the Company shall indemnify and hold harmless each member of the Board and each
director or employee of the Company to whom any duty or power relating to the
administration or interpretation of the Plan has been delegated against any cost
or expense (including counsel fees) or liability (including any sum paid in
settlement of a claim with the approval of the Board) arising out of any act or
omission in connection with the Plan, unless arising out of such person's own
fault or bad faith.


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          C. The Board may (but is not required to) appoint the Committee. If
all members of the Committee are Disinterested Directors, the Committee shall
have the authority to administer the Plan and exercise any power granted to the
Board in the Plan. If all members of the Committee are not Disinterested
Directors, the Committee shall have the authority solely to make recommendations
to the Board for the administration of the Plan.

     5. Eligibility

          Directors, officers and key employees and consultants of the Company
and its Subsidiaries shall be eligible for selection by the Board to be granted
Options. Consultants and directors who are not also employees of the Company or
a Subsidiary shall be eligible to be granted only Nonqualified Options. A
director, officer, employee or consultant who has been granted an Option may, if
he or she is otherwise eligible, be granted an additional Option or Options if
the Board shall so determine.

     6. Options

          A. Subject to adjustment as provided in Paragraph 13 hereof. Options
may be granted pursuant to the Plan for the purchase of not more than 548,063
Shares (575,466 Shares giving effect to the 5% stock dividend in September
2000); provided, however, that if prior to the termination of the Plan, an
Option shall expire or terminate for any reason without having been exercised in
full, the unpurchased Shares subject thereto shall again be available for the
purposes of the Plan.

          B. Each Option granted under the Plan shall be evidenced by an option
certificate or agreement for Shares in such form, not inconsistent with this
Plan, as the Board may adopt for general use or for specific cases from time to
time. Such option certificate shall designate each Option as an Incentive Stock
Option or a Nonqualified Option.

          C. The aggregate Fair Market Value (determined as of the time Options
are granted) of the Shares with respect to which Incentive Stock Options may be
or become exercisable for the first time by a Grantee during any calendar year
(whether granted under this Plan or any other plan of the Company or any Parent
or Subsidiary corporation shall not exceed $100,000. To the extent (and only to
the extent) that an Incentive Stock Option may be or become exercisable in
violation of this limitation, it shall be deemed to be a Nonqualified Option.

     7. Option Price

          A. The purchase price per Share deliverable upon the exercise of an
Option shall be determined by the Board, but in the case of an Incentive Stock
Option shall not be less than 100% of the Fair Market Value of a Share on the
date the Incentive Stock Option is granted to an Optionee-Shareholder.

          B. Payment for Shares purchased under an Option may be made (1) in
cash; (2) in Shares valued at their Fair Market Value on the date of exercise;
or (3) in a combination of cash and Shares.


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     8. Duration of Options

          Each Option and all rights thereunder shall expire and the Option
shall no longer be exercisable on a date not later than ten (10) years from the
date on which the Option was granted. Options may expire and cease to be
exercisable on such earlier date as the Board may determine at the time of
grant. Options shall be subject to termination before their expiration date as
provided herein.

     9. Conditions Relating to Exercise of Options

          A. The Shares subject to any Option may be purchased at any time
during the term of the Option, unless, at the time an Option is granted, the
Board shall have fixed a specific period or periods required to have passed as a
condition to exercise of an option or a part thereof. To the extent an Option is
not exercised when it becomes initially exercisable, or is exercised only in
part, the Option or remaining part thereof shall not expire but shall be carried
forward and shall be exercisable until the expiration or termination of the
Option. Partial exercise as to whole Shares is permitted from time to time,
provided that no partial exercise of an Option shall be for a number of Shares
having a purchase price of less than $1,000 unless the Grantee represents to the
Company that he or she is purchasing the Shares for investment.

          B. No Option shall be transferable by the Grantee thereof other than
or by the laws of descent and distribution, and Options shall be exercisable
during the life of a Grantee only by such Grantee or, to the extent that such
exercise would not prevent an Option from qualifying as an Incentive Stock
Option under the Internal Revenue Code, by his guardian or legal representative.

          C. Certificates for Shares purchased upon exercise of Options shall be
issued either in the name of the Grantee or in the name of the Grantee and
another person jointly with the right of survivorship. Such certificates shall
be delivered as soon as practical following the date the Option is exercised.

          D. An Option shall be exercised by the delivery to the Company at its
principal office, to the attention of its Chief Financial Officer, of written
notice of the number of Shares with respect to which the Option is being
exercised, and of the name or names in which the certificate for the Shares is
to be issued, and by paying the purchase price for the Shares in accordance with
paragraph 7 hereof. At the time of exercise of an Incentive Stock Option, the
Grantee also shall sign and deliver to the Company the Grantee's agreement to
notify the Company if the Grantee sells or otherwise disposes of any of the
Shares being purchased within two years after the date such Option was granted
or one year after the date of exercise.

          E. Notwithstanding any other provision in this Plan, no Option may be
exercised unless and until (i) this Plan has been approved by the shareholders
of the Company, and (ii) the Shares to be issued upon the exercise thereof have
been registered under the Securities Act of 1933 and applicable state securities
laws, or are, in the opinion of counsel to the Company, exempt from such
registration. The Company shall not be under any obligation to register under
applicable Federal or state securities laws any Shares to be issued upon the
exercise of an Option granted hereunder, or to comply with an appropriate
exemption from registration under such laws in order to permit the exercise of
an Option or the issuance and sale of Shares subject to such Option. If the
Company chooses to comply with such an exemption from registration, the
certificates for Shares issued under the Plan may, at the direction of the
Board, bear an appropriate restrictive legend restricting the transfer or pledge
of the Shares represented thereby, and the Board may also give appropriate
stop-transfer instructions to the transfer agent of the Company.


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          F. Any person exercising an Option or transferring or receiving Shares
shall comply with all regulations and requirements of any governmental authority
having jurisdiction over the issuance, transfer or sale of securities of the
Company or over the extension of credit for the purposes of purchasing or
carrying any margin securities, or the requirements of any stock exchange on
which the Shares may be listed, and as a condition to receiving any Shares,
shall execute all such instruments as the Board in its sole discretion may deem
necessary or advisable.

          G. Each Option shall be subject to the requirement that if the Board
shall determine that the listing, registration or qualification of the Shares
subject to such Option upon any securities exchange or under any state or
Federal law, or the consent or approval of any government or regulatory body, is
necessary or desirable as a condition of, or in connection with the granting of
such Option or the issuance or purchase of Shares thereunder, such Option may
not be exercised in whole or in part unless such listing, registration,
qualification, consent or approval shall have been effective or obtained free of
any conditions not acceptable to the Board.

     10. Effect of Termination of Employment or Death

          A. In the event of termination of a Grantee's employment or status as
a director by reason of such Grantee's death, disability, or retirement with the
consent of the Board or in accordance with an applicable retirement plan, any
outstanding Option held by such Grantee shall, notwithstanding the extent to
which such Option was exercisable prior to termination of employment,
immediately become exercisable as to the total number of Shares purchasable
thereunder. Any such Option shall remain so exercisable at any time prior to its
expiration date or, if earlier, the first anniversary of termination of the
Grantee's employment or status as a director. Grantees of Incentive Stock
Options shall be notified that certain federal income tax provisions granting
favorable treatment to Incentive Stock Options will not apply if such Options
are not exercised within three months after the date of termination of
employment (twelve months if employment terminates as a result of total and
permanent disability as defined in Section 22(e)(3) of the Internal Revenue
Code.

          B. In the event of termination of a Grantee's employment or status as
a director for any reason other than death, disability, or retirement with the
consent of the Board or in accordant with an applicable retirement plan, all
rights of any kind under any outstanding Incentive Stock Option held by Grantee
shall immediately lapse and terminate, except that the Board may, in its
discretion, eject to permit exercise for a period ending on the earlier of the
expiration date of the Incentive Stock Option and a date thirty days after the
termination of employment or status as director as to the total number of Shares
purchasable under the Incentive Stock Option as of the date of the termination.

          C. Whether an authorized leave of absence or absence in military or
government service shall constitute termination of employment or status as a
director shall be determined by the Board. Transfer of employment between the
Company and a Subsidiary corporation or between one Subsidiary corporation and
another shall not constitute termination of employment.


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     11. No Special Employment Rights

          Nothing contained in the Plan or in any Option shall confer upon any
Grantee any right with respect to his or her status as a director or the
continuation of his or her employment by the Company or a Subsidiary or
interfere in any way with the right of the Company or a Subsidiary, subject to
the terms of any separate employment agreement to the contrary, at any time to
terminate such employment or to increase or decrease the compensation of the
Grantee from the rate in existence at the time of the grant of an Option.

     12. Rights as a Shareholder

          The Grantee of an Option shall have no rights as a shareholder with
respect to any Shares covered by an Option until the date of issuance of a
certificate to him for such Shares. Except as otherwise expressly provided in
the Plan, no adjustment shall be made for dividends or other rights for which
the record date occurs prior to the date of issuance of such certificate.

     13. Anti-dilution Provision

          A. In case the Company shall (i) declare a dividend or dividends on
its Shares payable in shares of its capital stock, (ii) subdivide its
outstanding Shares, (iii) combine its outstanding Shares into a smaller number
of Shares, or (iv) issue any shares of capital stock by a reclassification of
its Shares (including any such reclassification in connection with a
consolidation or merger in which the Company is the continuing corporation), the
number of Shares authorized under the Plan will be adjusted proportionately.
Similarly, in any such event, there will be a proportionate adjustment in the
number and to the purchase price per Share of Shares subject to unexercised
Options (but without adjustment to the aggregate option price).

          B. In the event of (i) any transaction which constitutes a change in
control of the Company, (ii) any transaction which results in the sale of at
least fifty percent (50%) or more of the business or assets of the Company
during a period of twelve consecutive months, or (iii) any transaction which
involves a merger or consolidation of the Company in which stockholders of the
Company before such merger or consolidation do not, as a result of the merger or
consolidation, own at least fifty percent (50%) of the outstanding voting power
of the surviving entity following such merger or consolidation, the Board shall
modify all outstanding Options so as to accelerate, as a consequence of or in
connection with such transaction, a Grantee's right to exercise any Option.

          C. The Board, in its sole discretion, may determine that, upon the
occurrence of a transaction described in Paragraph 13B, each Option outstanding
hereunder shall terminate within a specified number of days after notice to the
holder, and such holder shall receive, with respect to each Share subject to
such Option, an amount equal to the excess of the Fair Market Value of such
Shares immediately prior to the occurrence of such transaction over the exercise
price per Share of such Option; such amount shall be payable in cash, in one or
more of the kinds of property payable in such transaction, or in a combination
thereof, as the Board in its discretion shall determine. The provisions
contained in the preceding sentence shall be inapplicable to an Option granted
within six (6) months before the occurrence of such a transaction if the holder
of such Option is subject to the reporting requirements of Section 16(a) of the
Exchange Act and no exemption from liability under Section 16(b) is otherwise
available to such holder.


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          D. Each Grantee will be notified of any such adjustment and any such
adjustment, or the failure to make such adjustment, shall be binding on the
Grantee.

     14. Withholding Taxes

          Whenever an Option is to be exercised under the Plan, the Company
shall have the right to require the Grantee, as a condition of exercise of the
Option, to remit to the Company an amount sufficient to satisfy the Company's
(or a Subsidiary's) Federal, state and local withholding tax obligation, if any,
that will, in the sole opinion of the Board, result from the exercise. In
addition, the Board may permit a Grantee to satisfy any such withholding tax
obligation by making an irrevocable election at least six (6) months prior to
exercise of an option to have the Company retain Shares issuable upon such
exercise having a Fair Market Value on the date of exercise equal to the amount
to be withheld.

     15. Amendment of the Plan

          The Board may at any time and from time to time terminate or modify or
amend the Plan in any respect, except that, without shareholder approval, the
Board may not (a) increase the number of Shares which may be issued under the
Plan or (b) modify the requirements as to eligibility for participation under
the Plan. The termination or modification or amendment of the Plan shall not,
without the consent of a Grantee, affect his or her rights under an Option
previously granted to him or her. With the consent of the Grantee, the Board may
amend outstanding Options in a manner not inconsistent with the Plan.

     16. Miscellaneous

          A. It is expressly understood that this Plan grants powers to the
Board but does not require their exercise; nor shall any person, by reason of
the adoption of this Plan, be deemed to be entitled to the grant of any Option;
nor shall any rights begin to accrue under the Plan except as Options may be
granted hereunder.

          B. All expenses of the Plan, including the cost of maintaining
records, shall be borne by Company.

     17. Governing Law

          This Plan and all rights hereunder shall be governed by and
interpreted in accordance with the laws of the Commonwealth of Pennsylvania.


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