<Page>

                                                                   Exhibit 10.21

                     BOSTON PRIVATE FINANCIAL HOLDINGS, INC.
                          DIRECTORS' STOCK OPTION PLAN
                   1998 AMENDMENT AND RESTATEMENT, AS AMENDED

         1. PURPOSE. The Boston Private Financial Holdings, Inc. Directors'
Stock Option Plan (the "Plan") is intended to provide incentives which will
attract, retain and motivate highly competent persons as outside directors of
Boston Private Financial Holdings, Inc. (the "Company") or Boston Private Bank &
Trust Company (the "Bank") or a subsidiary of either by providing them
opportunities to acquire shares of Common Stock of the Company pursuant to the
terms of this Plan. By providing opportunities for such stock ownership, the
interests of the Company, the Bank, or a subsidiary of either will be advanced
by aligning the interests of the outside directors, who are not full-time
employees, with those of shareholders of the Company, the Bank, or a subsidiary
of either.

         2. ADMINISTRATION. The Plan will be administered by the Compensation
Committee of the Board of Directors of the Company (the "Committee"). The
determinations of the Committee shall be made in accordance with their judgment
as to the best interests of the Company and its stockholders and in accordance
with the purpose of the Plan. Any determination of the Committee may be made
without notice or meeting of the Committee by a writing signed by the Committee
members. Subject to the provisions of this Plan, the Committee shall have full
power to construe and interpret the Plan and to establish, amend and rescind
rules and regulations for its administration. Any decisions made with respect
thereto shall be final and binding on the Company, the optionee and all other
persons.

         3. EFFECTIVE DATE. This Plan became effective on March 31, 1993 (the

<Page>

"Effective Date"), the date it was adopted by the Board of Directors of the
Company. The Plan was approved by the shareholders at the May 26, 1993 annual
meeting of shareholders of the Company. The Plan was amended and restated on
March 15, 1995, the date it was adopted by the Board of Directors of the Company
(the "1995 Restatement"). This Amendment and Restatement of the Plan became
effective on January 28, 1998 (the "1998 Restatement"), the date it was adopted
by the Board of Directors of the Company, provided, that, if recommended by
counsel or required by law, the 1998 Restatement is approved by the shareholders
at the next annual meeting of the shareholders of the Company following such
adoption of the 1998 Restatement of the Plan by the Board of Directors of the
Company.

         4. SHARES RESERVED UNDER THE PLAN. There originally was reserved for
issuance under the Plan an aggregate of 90,000 shares of Common Stock which may
be authorized but unissued or treasury shares. Pursuant to the 1995 Restatement,
there was reserved for issuance under the Plan an additional 110,000 shares of
Common Stock which may be authorized but unissued or treasury shares which
brought the aggregate total shares of Common Stock under the Plan to 200,000.
Pursuant to the 1998 Restatement, there is hereby reserved for issuance under
the Plan such aggregate number of shares of Common Stock as does not exceed one
percent (1%) of the total shares of outstanding Common Stock of the Company as
of the last business day of the preceding fiscal year, provided that any shares
described in this Section 4 which are not granted during a fiscal year shall not
carry over and be available for grants in any subsequent fiscal year. All of
such shares may, but need not, be issued pursuant to the exercise of stock
options. If there is a lapse, expiration, termination or cancellation of any
option prior to the issuance of shares thereunder, or if shares are issued upon
the exercise of a stock option and thereafter are reacquired by the Company
pursuant to rights reserved upon issuance thereof,


                                       2
<Page>

those shares may again be used for new benefits under this Plan. If payment for
shares upon the exercise of an option is made in shares of Common Stock, the
number of such shares delivered to the Company in payment for the exercise shall
be added back to the shares available for issuance under the Plan.

         5. PARTICIPANTS. Participants will consist of all directors of the
Company or the Bank or a subsidiary of either who are not full-time employees of
the Company or the Bank or a subsidiary of either.

         6. TYPES OF BENEFITS. Benefits under the Plan shall consist of
Non-qualified Stock Options and Stock Awards, each as hereinafter described.

         7. NON-QUALIFIED STOCK OPTIONS. All options granted under the Plan
shall be Non-qualified Stock Options not entitled to special tax treatment under
Section 422 of the Internal Revenue Code of 1986, as amended. Non-qualified
Stock Options shall consist of options to purchase shares of Common stock, at
purchase prices not less than 100% of the fair market value of the shares on the
date the option is granted. Non-qualified Stock Options will be exercisable not
earlier than one year and not later than ten years after the date they are
granted. In the event that the optionee ceases to be a director for any reason,
the right of the optionee to exercise any outstanding Non-qualified Stock Option
shall terminate not later than twelve months after the optionee ceases to be a
director. Further, if the optionee should die during a period when the optionee
is no longer a director and in which the option remains exercisable, the right
of the optionee's successor in interest to exercise a Non-qualified Stock Option
shall terminate not later than twelve months after the date of death of such
director. Notwithstanding the previous sentences, such twelve month period may
be extended by the Committee in its sole discretion as determined on a case by
case basis. However, in no event shall any Non-qualified


                                       3
<Page>

Stock Option be exercised more than ten years after its grant.

         8. ISSUANCE OF GRANT SHARES.

            (a) Each Non-qualified Stock Option granted under this Plan shall be
evidenced by a written agreement in the form attached hereto as Exhibit A, or
such other form as the Committee may approve from time to time.

            (b) Non-qualified Stock Options to purchase 3,000 shares of Common
Stock shall be granted on or about May 1, 1998, and on or about each succeeding
May 1, with such amount to be increased to 5,000 shares of Common Stock on May
1, 2002, and to be granted on or about each succeeding May 1, up to and
including May 1, 2007, to each outside director of the Company and to each
outside director of the Bank who is serving as a member of the Board of
Directors of the Company or as a member of the Board of Directors of the Bank at
the time of such grant. No grants of Non-qualified Stock Options shall be made
under this Plan after May 1, 2007. Notwithstanding the foregoing, any outside
director serving as a member of the Board of Directors of the Company and the
Board of Directors of the Bank simultaneously shall be granted only one option
to purchase 3,000 shares for any May 1 period.

            (c) Each outside director may choose to receive currently or on a
deferred basis his or her directors' fees either in cash or in shares of Common
Stock hereunder in accordance wit rules established by the Committee from time
to time. Any such stock awards that are deferred hereunder shall be credited
from time to time with dividend equivalents as determined by the Committee.

         9. ADJUSTMENT PROVISIONS.

            (a) If the Company shall at any time change the number of issued
shares of Common Stock without new consideration to the Company (such as by
stock dividend,


                                       4
<Page>

stock split, or similar transaction) the total number of shares
reserved for issuance under this Plan and the number of shares covered by each
outstanding benefit shall be adjusted so that the aggregate consideration
payable to the Company and the value of each benefit shall not be changed.

            (b) In the case of any reorganization, sale, merger, consolidation
or combination of the Company with or into another corporation other than a
reorganization, sale, merger, consolidation or combination in which the Company
is the continuing corporation and which does not result in the outstanding
Common Stock being converted or exchanged for different securities, cash or
other property, or any combination thereof (an "Acquisition"), any participant
to whom a stock option has been granted under the Plan shall have the right
(subject to the provisions of the Plan and any limitation applicable to such
option) thereafter and during the term of such option to receive upon exercise
thereof the Acquisition Consideration (as hereinafter defined) receivable upon
such Acquisition by a holder of the number of shares of Common Stock which might
have been obtained upon exercise of such option or portion thereof, as the case
may be, immediately prior to such Acquisition. The term "Acquisition
Consideration" shall mean the kind and amount of shares of the surviving or new
corporation, cash, securities, evidence of indebtedness, other property or any
combination thereof, receivable in respect of one share of Common Stock of the
Company upon consummation of an Acquisition.

         10. NON-TRANSFERABILITY. Each option granted under the Plan shall not
be transferable otherwise than by will, or the laws of descent and distribution,
and shall be exercisable during the participant's lifetime only by the
participant. In the event of the death of a participant, exercise shall be made
only by the executor or administrator of the estate of the

                                       5
<Page>

deceased participant or the person or persons to whom the deceased participant's
rights under the option shall pass by will or the laws of descent and
distribution.

         11. LIMITATION OF RIGHTS. The award of any benefit under the Plan may
also be subject to any other provisions (whether or not applicable to the
benefit awarded to any other participant) which the Committee determines
appropriate, including, without limitation, provisions for the installment
purchase of Common Stock under stock options, restrictions on resale or other
dispositions, or understandings or conditions as to the participant's employment
in addition to those specifically provided for under the Plan. Neither the Plan,
nor the granting of an option nor any other action taken pursuant to the Plan,
shall constitute or be evidence of any agreement or understanding, express or
implied, that the Company or the Bank will retain a Director for any period of
time, nor compensate the Director at any particular rate, or at all. A Director
shall have no rights as a shareholder with respect to the shares covered by his
options until the date of issuance to said Director of a stock certificate
evidencing exercise thereof. No adjustment will be made for dividends or other
rights for which the record date is prior to the issue date of such stock
certificate.

         12. TAXES. The Company shall be entitled to withhold the amount of any
tax attributable to any shares deliverable under the Plan after giving the
person entitled to receive the shares notice as far in advance as practicable
and the Company may defer making delivery as to any benefit if any such tax is
payable until indemnified to its satisfaction. The Committee may, in its
discretion and subject to rules which it may adopt, permit a participant to pay
all or a portion of the taxes arising in connection with the exercise of a
Non-qualified Stock Option by electing to have the Company withhold shares of
Common Stock from the shares otherwise deliverable to the participant, having a
fair market value equal to the amount to be withheld. The


                                       6
<Page>

fair market value of any fractional shares remaining after payment of
withholding taxes shall be paid to the participant in cash,

         13. DURATION AMENDMENT AND TERMINATION. No benefit shall be granted
more than ten years after the date of adoption of this Plan; provided, however,
that the terms and conditions applicable to any benefit granted within such
period may thereafter be amended or modified by mutual agreement between the
Company and the participant or such other persons as may then have an interest
therein. The Board of Directors of the Company may amend the Plan from time to
time or terminate the Plan at any time. However, no action authorized by this
section shall reduce the amount of any existing benefit or change the terms and
conditions thereof without the participant's consent.

         14. GOVERNING LAW. The Plan and all determinations made and action
taken pursuant hereto shall be subject to and construed in accordance with the
law of The Commonwealth of Massachusetts.


                                       7
<Page>

                                    AMENDMENT
                                     TO THE
                     BOSTON PRIVATE FINANCIAL HOLDINGS, INC.
                          DIRECTORS" STOCK OPTION PLAN

                                FEBRUARY 7, 2003

         This Amendment to the Boston Private Financial Holdings, Inc.
Directors' Stock Option Plan (the "Plan") shall be effective as of February 7,
2003, upon ratification by the Board of Directors.

1.       The third sentence of Section 7 of the Plan is hereby amended by
deleting said sentence in its entirely and substituting therefore the following:

         "Non-qualified Stock Options will be exercisable not earlier than one
     year and not later than ten years after the date they are granted, UNLESS
     OTHERWISE PROVIDED BY THE COMMITTEE,"

2.       Section 8 of the Plan is hereby amended by adding a subsection (d) at
the end thereof as follows:

         "(d) Upon resignation or retirement from the Board, and provided the
     Director has served four three-year terms as a Director of the Company,
     each Director shall be awarded Non-Qualified Stock Options to purchase a
     total of 10,000 shares of Common Stock hereunder, subject to such
     restrictions, exercise limitations or other conditions as may be
     established from time to time by the Committee."

3.       Except as specifically amended hereby, the Plan shall continue in
full force and effect. From and after the date hereof, all references in any
agreements covering awards granted under the Plan shall be deemed to be
references to the Plan as hereby amended.