EXHIBIT 10.13

                                    RESTATED
                          EXECUTIVE SERVICES AGREEMENT

         This Restated Executive Services  Agreement,  made as of the 1st day of
January,  1998 by and among ESSEX  SAVINGS BANK,  FSB (the "Bank"),  ESSEX FIRST
MORTGAGE CORPORATION, a subsidiary of the Bank (collectively,  the "Employers"),
and EARL MCPHERSON ("Employee").

                                   WITNESSETH:

         WHEREAS,  the Employee has  heretofore  been employed as Executive Vice
President of the Bank and President and Chief  Executive  Officer of Essex First
Mortgage  Corporation  pursuant to that  certain  Executive  Services  Agreement
between the Employers and  Employee,  dated as of July 1, 1993 and  subsequently
amended, (the "Original Agreement"); and

         WHEREAS,  the  Employers  and Employee  desire to amend and restate the
Original Agreement.

         NOW,  THEREFORE,  in consideration of the premises and mutual covenants
set forth  herein,  and other good and valuable  consideration,  the adequacy of
which is hereby  acknowledged,  the Employers and the Employee amend and restate
the Original Agreement to read as follows:

         1.  Employment.  The Employers  hereby  continue the  employment of the
Employee as Executive  Vice  President of Essex Savings Bank,  FSB and President
and Chief Executive  Officer of Essex First Mortgage  Corporation.  The Employee
accepts  such  continued  employment,  and  agrees  to abide  by the  respective
Certificates  or  Articles of  Incorporation,  Bylaws and the  decisions  of the
Boards of Directors of the Employers.

         2. Duties and Responsibilities.  The Employee agrees to devote his full
time  attention  and  energies to the  business  affairs of the  Employers.  The
Employee  shall  render such  administrative  and  management  services  for the
Employers  as  are  customarily  performed  by  persons  situated  in a  similar
capacity.  The Employee's duties shall be such as the Boards of Directors of the
Employers  or the  Chief  Executive  Officer  of the Bank may from  time to time
direct.

         3. Term of Agreement.  This Restated  Executive Services Agreement (the
"Agreement") and Employee s employment hereunder shall continue until terminated
as provided in Section 9 below.

         4. Salary and Incentive Bonus.

                  (a)  During  1998,  the  Employers  shall pay to  Employee  an
aggregate  basic  salary at the rate of One Hundred  Nine  Thousand  Six Hundred
Twenty  Dollars  ($109,620)  per year  ("Salary")  payable  in  arrears  no less
frequently  than  semi-monthly  (after  deduction  of  federal,  state and local
withholding and similar taxes,  amounts required to be withheld  pursuant to any
employee  benefits  programs,   and  other  authorized  payroll  deductions)  in
accordance with the usual employee payroll practices of the Employers.  The rate
of  Employee's  Salary  shall be reviewed by the  Employers  not less often than
annually  and may be  increased  from time to time in such amounts as the Bank's
Board of  Directors  in its  discretion  may  determine  based  upon  Employee's
performance.

                  (b) In addition to his Salary,  Employee may, but shall not be
entitled to, receive from the Employers such cash bonuses,  if any, as the Board
of  Directors  of the  Employers  in  their  sole  discretion  elect to award to
Employee.

         5. Other Benefits. Throughout the term of this Agreement, the Employers
shall  provide  Employee  with  group  life,  health  and  disability  insurance
coverage,  in amounts and on terms and  conditions  as favorable as the coverage
provided other executive  employees of the Employers from time to time. Employee
shall  also  be a  participant  in the  Essex  Savings  Bank,  FSB  Supplemental
Executive  Retirement  Plan and any other pension or retirement  plan maintained
from  time to  time by  Employers.  Moreover,  Employee  shall  be  eligible  to
participate in any fringe benefit  program which may be or become  applicable to
executives   of   the   Employers   of   comparable   rank   having   comparable
responsibilities.

         6. Regulatory  Approval.  So long as employment  agreements between the
Bank and any  executive  officer are subject to prior  approval by the Office of
Thrift Supervision ("OTS") or other federal agency (including the prior approval
requirement  of OTS  Regulatory  Bulletin  27a),  any  compensation  payable  to
Employee pursuant to this Agreement  (including severance benefits and Change in
Control  benefits  payable to Employee under Section 11) shall be subject to and
conditioned  upon approval by the OTS or other regulatory  agency.  All payments
hereunder are also subject to and conditioned upon their compliance with Section
1828(k) of Title 12 of the United  States Code and any  regulations  promulgated
thereunder.  Any modification in the Employee's compensation required by the OTS
or other  competent  regulatory  agency shall not alter in any way the duties or
obligations of Employee under this Agreement.

         7. Vacation and Sick Leave. Employee shall be entitled to paid vacation
each year in the amount he is  currently  authorized  to take by the  Employers.
Employee shall not be entitled to receive any additional  compensation  from the
Employers  on account of his  failure to take a  vacation  except  that  accrued
vacation  pay will be paid  upon  termination  of  employment;  nor  shall he be
entitled to accumulate unused vacation from one calendar year to the next except
to the  extent  authorized  by the  Boards of  Directors  of the  Employers.  In
addition,  the Employee shall be entitled to annual sick leave as established by
the Employers for management  officials of the Employers.  In the event any sick
leave time shall not have been used during any year,  such leave shall accrue to
subsequent years to the extent  authorized under generally  applicable  Employer
policies. Upon termination of his employment, the Employee shall not be entitled
to receive any additional compensation from the Employers for unused sick leave,
except as is permitted under generally applicable Employer policies.

         8. Loyalty; Non-piracy; Confidentiality.

                  (a) The  Employee  shall devote his full time and best efforts
to the performance of his employment  under this  Agreement.  The Employee shall
abide by the Employers' "Corporate Code of Conduct." During his employment under
this  Agreement,  the  Employee  shall not engage in any  business  or  activity
contrary  to  the  business  affairs  or  interests  of the  Employers.  Nothing
contained  in this Section 8,  however,  shall be deemed to prevent or limit the
right of  Employee  to invest in the capital  stock or other  securities  of any
business dissimilar from that of Employers, or, solely as a passive and minority
investor,  in any business. In no event shall Employee use or disclose to others
confidential "inside information" regarding the Employers or their affiliates or
engage,  directly or indirectly,  in any transaction involving the securities of
the parent of the Employers based upon such "inside information."

                  (b) During  Employee's  term of employment  with Employers and
for nine (9) months  thereafter  (irrespective  of the time,  manner or cause of
termination  or  resignation),  Employee shall not,  directly or indirectly,  on
behalf of Employee or any entity or person other than  Employers hire or solicit
for employment in, employ in, or cause to be employed in any Competing  Business
any personnel of the Employers who are or were employed by Employers at any time
during  the  period  beginning  one year  prior to  Employee  s  termination  or
resignation, unless any such person has not been employed by the Employers for a
period in excess of one  continuous  year.  For purposes of this Section 8(b), a
Competing  Business  means any  person or entity  which is engaged  directly  or
indirectly in any business engaged in by the Employers and whose market area for
such businesses  overlaps that of the Employers.  Notwithstanding the foregoing,
this Section 8(b) shall not apply if Employee is terminated  without Cause under
Section 9(b) below and Employers fail to pay to Employee the amounts required to
be paid under Sections 9(b) and 11(a) below.

                  (c) At no time  during or  following  the term of  Employee  s
employment  with Employer  (irrespective  of the time,  manner,  or cause of the
termination  or  resignation),  shall  Employee  disclose to any other person or
entity,  nor shall Employee use for Employee's own benefit or for the benefit of
any other entity or person,  any  confidential  information  or trade secrets of
Employers,  including, without limitation, any confidential information relating
to the identities, background, historical information, or terms of dealings with
any of Employers' customers, prospects, potential customers, suppliers, or sales
or  purchasing  agents,  or  confidential   information   respecting   financial
arrangements, marketing strategies, pricing methods and determinations,  methods
of operation,  procedures or any other  material of a similar nature or relating
to  Employers'  conduct of their  business(es).  Upon  cessation  of  Employee's
employment  hereunder,  Employee  will  surrender  and deliver to Employers  all
lists, books,  records, and data of every kind, including machine readable data,
relating to or in connection with Employers customers and business.

                  (d) The  provisions  of this  Section  8  shall  apply  to any
resignation or termination of Employee s employment,  with or without Cause, and
shall survive termination of this Agreement.

                  (e) Employee  acknowledges that the failure to adhere strictly
to the  requirements  of this Section 8 will cause  substantial  and irreparable
harm to Employers. Accordingly, in the event Employee, at any time, violates any
provision  hereof,  Employers  shall be entitled to enforce all of the following
cumulative  remedies from time to time: (1) to obtain injunctive relief or other
equitable remedies to cause cessation of activities in violation of the terms of
this  Section  8;  and  (2) to  seek  all  damages  proximately  caused  by such
activities.  In any such action brought by Employers, the prevailing party shall
be entitled to recover all expenses incurred and reasonable attorney's fees.

         9. Termination.

                  (a)  Termination  by an  Employer  with  Cause.  The  Board of
Directors of any Employer  may  terminate  this  Agreement  (and the  Employee's
employment  hereunder) at any time,  immediately  with notice,  for "Cause." For
purposes of this  Agreement,  termination  of Employee for "Cause" shall include
termination as a result of Employee's personal dishonesty, incompetence, willful
misconduct,  breach of fiduciary duty involving personal profit, conviction of a
felony,  willful  violation of any law, rule or  regulation  (other than traffic
violations  or similar  offenses) or final cease and desist  order,  intentional
breach or neglect by Employee of his duties hereunder,  persistent negligence or
misconduct  in the  performance  of  such  duties,  or  material  breach  of any
provision  of this  Agreement.  In the event of  termination  of Employee by any
Employer for "Cause," the Employee  shall be paid solely the Salary and vacation
pay accrued and  prorated to the date of his  termination.  For purposes of this
Section  9(a),  any act or omission to act by the Employee in reliance  upon any
opinion of counsel to an Employer or counsel to the Employee shall not be deemed
to be willful.

                  (b)  Termination by an Employer  Without  Cause.  The Board of
Directors  of  any  Employer  may  terminate  this  Agreement  (and   Employee's
employment  hereunder)  without  "Cause"  (as defined  above),  at any time upon
thirty (30) days advance  written  notice to the  Employee.  In such event,  the
Employee, if requested by the Board of Directors of the Employer, shall continue
to render his services to the Employers  according to this Agreement through the
effective  date of his  termination.  In the event the Board of Directors of any
Employer terminates this Agreement (and Employee's  employment) without "Cause,"
the Employee  shall be entitled to the severance  benefits  described in Section
11(a) below (assuming termination prior to a Change in Control), plus his Salary
and vacation pay accrued and prorated through the date of his termination.

                  (c) Termination by Employee with Just Cause.  The Employee may
terminate this Agreement (and his employment hereunder) at any time, immediately
with notice, for "Just Cause." For purposes of this Section 9(c), the term "Just
Cause" shall mean:  (i) a reduction in  Employee's  Salary  without his consent;
(ii) an  Employer-imposed  requirement  that  Employee  relocate his office to a
location  which is more than ninety (90) miles from  Norfolk,  Virginia  without
Employee's  consent;  (iii) a material change by Employers in Employee's  titles
and/or reporting  responsibilities  without Employee's consent,  which change is
not reversed  within ten (10)  business  days after  written  notice by Employee
objecting  to the change;  or (iv)  failure by the  Employers to comply with any
material  provision of this  Agreement,  which failure has not been cured within
ten (10) business days after written notice of such noncompliance has been given
by the  Employee to the  Employers.  In the event the Employee  terminates  this
Agreement  for Just Cause,  the  Employee  shall be  entitled  to the  severance
benefits  described  in Section  11(a) below  (assuming  termination  prior to a
Change in  Control),  plus his Salary and  vacation  pay  accrued  and  prorated
through the effective date of termination.

                  (d) Termination by Employee  Without Just Cause. The Employee,
without Just Cause, may terminate this Agreement (and his employment  hereunder)
upon thirty  (30) days'  written  notice to the  Employers.  In such event,  the
Employee  shall  continue to render the services  required  under this Agreement
(unless directed not to do so by any Employer's Board of Directors) and shall be
paid solely the Salary and vacation  accrued and prorated  through the effective
date of his termination.

                  (e)  Termination  Upon Death or  Disability  of  Employee.  In
addition to any other provision relating to termination, this Agreement shall be
automatically   terminated  in  the  event  of  Employee's  death  or  permanent
disability.  In such event the  Employee  shall be paid the amount of Salary and
vacation accrued and prorated through the date of death or permanent disability,
as well as other benefits provided to deceased or disabled  employees  generally
under Employers' policies and benefit plans.

         10. Suspension or Termination as Required by Government Regulations.

                  (a) If the Employee is suspended and/or temporarily prohibited
from  participating in the conduct of affairs of the Bank by notice served under
Section  8(e)(3)  or (g)(1) of the  Federal  Deposit  Insurance  Act (12  U.S.C.
ss.1818(e)(3) and (g)(1)), the Employers' obligations under this Agreement shall
be suspended as of the date of service unless stayed by appropriate proceedings.
If the  charges  in  the  notice  are  dismissed,  the  Employers  may in  their
discretion pay the Employee all or part of the compensation withheld while their
obligations  under this Agreement were suspended,  and reinstate (in whole or in
part) any of their obligations which were suspended.

                  (b) If the Employee is removed and/or  permanently  prohibited
from participating in the conduct of the Bank's affairs by an order issued under
Section  8(e)(4)  or (g)(1) of the  Federal  Deposit  Insurance  Act (12  U.S.C.
ss.1818(e)(4) or (g)(1)),  all obligations of the Employers under this Agreement
shall terminate as of the effective date of the order, but rights of the parties
which vested prior to that effective date shall not be affected.

                  (c) If the Bank is in default (as  defined in Section  3(x)(1)
of the Federal  Deposit  Insurance Act) all  obligations of the Employers  under
this  Agreement  shall  terminate as of the date of default,  but this paragraph
shall not affect any rights of the parties hereto which vested prior to the date
of that default.

                  (d) All  obligations  of the  Employers  under this  Agreement
shall  terminate,  except to the extent  that  continuation  of the  contract is
determined to be necessary  for the continued  operation of the Employers by (i)
the  director  of the OTS  (the  "Director")  or his  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  Federal  Deposit  Insurance  Act;  or (ii)  the  Director  or his
designee, at the time the Director or his designee approves a supervisory merger
to resolve  problems  related to the  operation  of the Bank or when the Bank is
determined by the Director to be an unsafe or unsound condition;  but any rights
of the parties  hereto that have already vested prior to such  determination  or
action shall not be affected by such determination or action.

         11. Severance Benefit and Change of Control Payment.

                  (a) In the event of termination of this Agreement and Employee
s employment hereunder prior to a Change in Control (as defined in Section 11(b)
below) by the  Employers  without  "Cause" under Section 9(b) or by the Employee
with  "Just  Cause"  under  Section  9(c) the  Employers  shall:  (1) pay to the
Employee in a lump sum within thirty (30) days of termination an amount equal to
one hundred and fifty  percent  (150%) of his highest  rate of annual  Salary in
effect during the period commencing on May 1, 1997 and ending on the date of his
termination; and (2) provide continuing health and medical insurance, disability
insurance and life insurance  coverage on behalf of the Employee (and Employee's
other family  members,  if applicable)  for a period of twelve months  following
termination  on the same  basis as was in  effect  as of the  effective  date of
termination.

                  (b) In the event of a Change in Control  occurs prior to or on
the date of termination of this Agreement,  the Employers  shall: (1) pay to the
Employee  in a lump sum  within  thirty  (30) days of the  Change of  Control an
amount  equal to one hundred  and fifty  percent  (150%) of his highest  rate of
annual Salary in effect  during the period  commencing on May 1, 1997 and ending
on the date of the Change in  Control;  and (2)  provide  continuing  health and
medical insurance, disability insurance and life insurance coverage on behalf of
the  Employee  (and his other family  members,  if  applicable)  for a period of
twelve (12) months  following  the Change in Control on the same basis as was in
effect as of the effective date of termination.  For purposes of this Agreement,
a Change in Control shall occur if and only if after  December 31, 1997 a person
or group (as such  term is used in  Sections  13(d) and 14(d) of the  Securities
Exchange Act of 1934),  directly or  indirectly,  first becomes the  "beneficial
owner" (as defined in Rule 13d-3 under the  Securities  Exchange Act of 1934) of
securities  of Essex  Bancorp,  Inc.  representing  20% or more of the  combined
voting  power of the then  outstanding  securities  of Essex  Bancorp,  Inc. Any
provision herein to the contrary notwithstanding,  no Change in Control shall be
deemed to occur as a result  of: (1) any  transaction  prior to January 1, 1998;
(2) any purchase,  transfer,  or other  disposition of the Series B and Series C
preferred  shares of Essex  Bancorp,  Inc.; or (3) any exercise or conversion of
warrants or options of Essex Bancorp,  Inc. which were issued prior to 1996 (and
any exercise,  or conversion of such warrants or options shall be disregarded in
determining whether a Change of Control has occurred.)

                  (c) Any provision herein to the contrary notwithstanding:  (i)
no severance  payment  under  Section  11(a) or Change in Control  payment under
Section 11(b) shall be due to Employee if Employer terminates Employee for Cause
under  Section 9(a) or Employee  resigns  without Just Cause under  Section 9(d)
prior to a Change in Control;  and (ii) under no circumstances shall Employee be
entitled to a payment under both Section 11(a) and Section 11(b) above.

         12. Adverse  Statements and/or Action. The Employers and Employee agree
that during the term of this  Agreement  and  thereafter  they will refrain from
making any  adverse  public  statements  about  each  other,  or the  Employers'
employees.  An adverse statement is one which is derogatory or otherwise of such
a nature that it tends to be embarrassing, humiliating or injurious to the name,
reputation or business of the party about whom the statement is made, whether or
not the party making such statement  believes it to be true. Upon termination of
this Agreement,  the Employers and Employee will use their best efforts to reach
agreement  on the text of any public  statement,  if  necessary,  regarding  the
employment  relationship  which is  satisfactory  to both.  Notwithstanding  the
foregoing,  neither party shall be prohibited  from making any public  statement
compelled by law or which is otherwise legally privileged, or from correcting or
commenting upon a public statement or public reports  originating from any other
source. This provision shall be in addition to any other rights and duties which
may arise under the laws of defamation, unfair competition and similar laws.

         13. General Matters.

                  (a) This Agreement shall be governed by the  substantive  laws
of the State of Virginia and shall be construed in  accordance  therewith.  This
Agreement constitutes the entire agreement between the parties as to the matters
described  herein and  supersedes all prior  employment  and executive  services
agreements and understandings between the parties.

                  (b) No provision  of this  Agreement  may be waived  except by
agreement  in  writing  signed  by the  waiving  party.  A waiver of any term or
provision shall not be construed as a waiver of any other term or provision.

                  (c) This  Agreement may be amended,  altered or revoked at any
time,  in whole or in part,  only by a written  instrument  setting  forth  such
changes, signed by all the parties.

                  (d) This Agreement  shall be binding upon the Employee and the
Employers, and shall not be assignable in any event by the Employee.

                  (e)  Throughout  this Agreement the singular shall include the
plural and the  plural  shall  include  the  singular  whenever  the  context so
requires.

                  (f) To  the  extent  that  any  provision  of  this  Agreement
directly  and  expressly  conflicts  with the  provisions  of 12 C.F.R.  Section
563.39(b), or any successor regulation,  the provisions of such regulation shall
control.

                  (g) If any  provision  of this  Agreement  is  declared by any
court of common  jurisdiction to be invalid for any reason such invalidity shall
not affect the remaining provisions.

On the contrary,  such  remaining  provisions  shall be construed in force as if
such invalid provisions had never been inserted in this Agreement.

         IN  TESTIMONY  WHEREOF,  the parties  have caused this  Agreement to be
executed as of the 1st day of January, 1998.

                             ESSEX SAVINGS BANK, FSB



                             By       /s/ Gene D. Ross
                             Its:     President


                             ESSEX FIRST MORTGAGE CORPORATION



                             By       /s/ Gene D. Ross
                             Its:     Chairman



                                      /s/ Earl C. McPherson  (SEAL)
                             Employee