<PAGE>
                                                                     Exhibit 3

                               RESOLUTIONS OF THE
              BOARD OF DIRECTORS OF PEEKSKILL FINANCIAL CORPORATION
                     RELATING TO AN AMENDMENT TO THE BY-LAWS

         WHEREAS, the Board of Directors of Peekskill Financial Corporation (the
"Company") met and discussed its intention that the Company continue to be
highly sensitive to the needs of the community it serves; and

         WHEREAS, the community the Company and its subsidiaries currently
serves is primarily Northern Westchester and Southern Putnam Counties of New
York, as more specifically identified in First Federal Savings Bank's Community
Reinvestment Act statement Delineated Community Section (the "primary market
area");

         WHEREAS, substantially all of the Company's loans are secured by
property located within its primary market area and substantially all of its
deposits are obtained from individuals or entities located in its primary market
area; and

         WHEREAS, the Board of Directors has determined that in order to
adequately assess and best serve the needs of the Company's primary market area
a director must be knowledgeable of and actively involved in the communities the
Company serves; and

         WHEREAS, the Board of Directors believes, based upon the foregoing,
that it would be appropriate and in the best interest of the Company and its
shareholders to amend its By-laws to require that all directors be domiciled in
or have their primary place of business located in the Company's primary market
area; and

         WHEREAS, the Board of Directors has considered the size and diversity
of the population base of its primary market area and believes that, if
necessary or desired, there is a sufficient pool of potentially qualified
individuals located therein who would be available for consideration for
nomination as a director of the Company; and

         NOW THEREFORE, be it

         RESOLVED, that the Board of Directors of the Company hereby approves
the adoption of an amendment to Article II of the By-laws by adding the
following new Section 10, as follows:

                  Section 10. Qualifications. Any member of the Board of
Directors shall, in order to qualify as such, be domiciled in or have his or her
primary place of business located in Northern Westchester or Southern Putnam
Counties of New York.

                                       17

<PAGE>

         BE IT FURTHER RESOLVED, that the appropriate officers of the Company be
and hereby are authorized and directed to take all action necessary or
appropriate to implement the foregoing resolutions and any actions previously
taken by such officers be and hereby are approved, ratified and confirmed.

         I, William J. LaCalamito, the duly elected Secretary of Peekskill
Financial Corporation hereby certify that the foregoing is a true and accurate
copy of the resolutions adopted by the Board of Directors of Peekskill Financial
Corporation at a meeting held this 8th day of April 1997, where a quorum was
present and acting throughout.



Date:  April 9, 1997                                 /s/ William J. LaCalamito
                                                     -------------------------
                                                     William J. LaCalamito
                                                     Secretary


                                       18