EXHIBIT 10.2

                            HARLEYSVILLE SAVINGS BANK
                             1995 STOCK OPTION PLAN

                                    ARTICLE I
                            ESTABLISHMENT OF THE PLAN

      Harleysville Savings Bank (the "Bank") hereby establishes this 1995 Stock
Option Plan (the "Plan") upon the terms and conditions hereinafter stated.

                                   ARTICLE II
                               PURPOSE OF THE PLAN

      The purpose of this Plan is to improve the growth and profitability of the
Bank and its Subsidiary Companies by providing Employees and Non-Employee
Directors with a proprietary interest in the Bank as an incentive to contribute
to the success of the Bank and its Subsidiary Companies, and rewarding Employees
and directors for outstanding performance and the attainment of targeted goals.
All Incentive Stock Options issued under this Plan are intended to comply with
the requirements of Section 422 of the Code, and the regulations thereunder, and
all provisions hereunder shall be read, interpreted and applied with that
purpose in mind.

                                   ARTICLE III
                                   DEFINITIONS

      3.01 "Award" means an Option granted pursuant to the terms of this Plan.

      3.02 "Board" means the Board of Directors of the Bank.

      3.03 "Code" means the Internal Revenue Code of 1986, as amended.

      3.04 "Committee" means a committee of two or more directors appointed by
the Board pursuant to Article IV hereof, none of whom shall be an Officer or
Employee of the Bank, and each of whom shall be a "disinterested person" within
the meaning of Rule 16b-3 under the Exchange Act, or any successor thereto.

      3.05 "Common Stock" means shares of the common stock, $1.00 par value per
share, of the Bank.


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      3.06 "Disability" means any physical or mental impairment which qualifies
an Employee for disability benefits under the applicable long-term disability
plan maintained by the Bank or a Subsidiary Company, or, if no such plan
applies, which would qualify such Employee for disability benefits under the
Federal Social Security System.

      3.07 "Effective Date" means the day upon which the Board approves this
Plan.

      3.08 "Employee" means any person who is employed by the Bank or a
Subsidiary Company, or is an Officer of the Bank or a Subsidiary Company, but
not including directors who are not also Officers of or otherwise employed by
the Bank or a Subsidiary Company.

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

      3.10 "Fair Market Value" shall be equal to the fair market value per share
of the Bank's Common Stock on the date an Award is granted. For purposes hereof,
the Fair Market Value of a share of Common Stock shall be the closing sale price
of a share of Common Stock on the date in question (or, if such day is not a
trading day in the U.S. markets, on the nearest preceding trading day), as
reported with respect to the principal market (or the composite of the markets,
if more than one) or national quotation system in which such shares are then
traded, or if no such closing prices are reported, the mean between the high bid
and low asked prices that day on the principal market or national quotation
system then in use, or if no such quotations are available, the price furnished
by a professional securities dealer making a market in such shares selected by
the Committee.

      3.11 "Incentive Stock Option" means any Option granted under this Plan
which the Board intends (at the time it is granted) to be an incentive stock
option within the meaning of Section 422 of the Code or any successor thereto.

      3.12 "Non-Employee Director" means a member of the Board who is not an
Officer or Employee of the Bank or any Subsidiary Company.

      3.13 "Non-Qualified Option" means any Option granted under this Plan which
is not an Incentive Stock Option.

      3.14 "Officer" means an Employee whose position in the Bank or Subsidiary
Company is that of a corporate officer, as determined by the Board.

      3.15 "Option" means a right granted under this Plan to purchase Common
Stock.

      3.16 "Optionee" means an Employee or Non-Employee Director or former
Employee or Non-Employee Director to whom an Option is granted under the Plan.


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      3.17 "Retirement" means a termination of employment upon or after
attainment of age sixty-five (65) or such earlier age as may be specified in any
applicable qualified pension benefit plan maintained by the Bank or a Subsidiary
Company.

      3.18 "Subsidiary Companies" means those subsidiaries of the Bank which
meet the definition of "subsidiary corporations" set forth in Section 425(f) of
the Code, at the time of granting of the Option in question.

                                   ARTICLE IV
                           ADMINISTRATION OF THE PLAN

      4.01 Duties of the Committee. The Plan shall be administered and
interpreted by the Committee, as appointed from time to time by the Board
pursuant to Section 4.02. The Committee shall have the authority in its absolute
discretion to adopt, amend and rescind such rules, regulations and procedures
as, in its opinion, may be advisable in the administration of the Plan,
including, without limitation, rules, regulations and procedures which (i) deal
with satisfaction of an Optionee's tax withholding obligation pursuant to
Section 12.02 hereof, (ii) include arrangements to facilitate the Optionee's
ability to borrow funds for payment of the exercise or purchase price of an
Award, if applicable, from securities brokers and dealers, and (iii) include
arrangements which provide for the payment of some or all of such exercise or
purchase price by delivery of previously-owned shares of Common Stock or other
property and/or by withholding some of the shares of Common Stock which are
being acquired. The interpretation and construction by the Committee of any
provisions of the Plan, any rule, regulation or procedure adopted by it pursuant
thereto or of any Award shall be final and binding.

      4.02 Appointment and Operation of the Committee. The members of the
Committee shall be appointed by, and will serve at the pleasure of, the Board.
The Board from time to time may remove members from, or add members to, the
Committee, provided the Committee shall continue to consist of two or more
members of the Board, none of whom shall be an officer or employee of the Bank,
and each of whom shall be a "disinterested person" within the meaning of Rule
16b-3 under the Exchange Act. The Committee shall act by vote or written consent
of a majority of its members. Subject to the express provisions and limitations
of the Plan, the Committee may adopt such rules, regulations and procedures as
it deems appropriate for the conduct of its affairs. It may appoint one of its
members to be chairman and any person, whether or not a member, to be its
secretary or agent. The Committee shall report its actions and decisions to the
Board at appropriate times but in no event less than one time per calendar year.

      4.03 Revocation for Misconduct. The Committee may by resolution
immediately revoke, rescind and terminate any Option, or portion thereof, to the
extent not yet vested, previously granted or awarded under this Plan to an
Employee who is discharged from the employ of the Bank or a Subsidiary Company
for cause, which, for purposes hereof, shall mean termination because of the
Employee's personal dishonesty, incompetence, willful misconduct, breach of
fiduciary duty involving personal profit,


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intentional failure to perform stated duties, willful violation of any law,
rule, or regulation (other than traffic violations or similar offenses) or final
cease-and-desist order. Options granted to a Non-Employee Director who is
removed for cause pursuant to the Bank's Articles of Incorporation shall
terminate as of the effective date of such removal.

      4.04 Limitation on Liability. No member of the Committee shall be liable
for any action or determination made in good faith with respect to the Plan, any
rule, regulation or procedure adopted by it pursuant thereto or any Awards
granted under it. If a member of the Committee is a party or is threatened to be
made a party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative, by reason of anything
done or not done by him in such capacity under or with respect to the Plan, the
Bank shall, subject to the requirements of applicable laws and regulations,
indemnify such member against all liabilities and expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in the best interests
of the Bank and its Subsidiary Companies and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his conduct was
unlawful.

      4.05 Compliance with Law and Regulations. The Bank shall not be required
to issue or deliver any certificates for shares of Common Stock prior to the
completion of any registration or qualification of or obtaining of consents or
approvals with respect to such shares under any Federal or state law or any rule
or regulation of any government body, which the Bank shall, in its sole
discretion, determine to be necessary or advisable. Moreover, no Option may be
exercised if such exercise would be contrary to applicable laws and regulations.

      4.06 Restrictions on Transfer. The Bank may place a legend upon any
certificate representing shares acquired pursuant to an Award granted hereunder
noting that the transfer of such shares may be restricted by applicable laws and
regulations.

                                    ARTICLE V
                                   ELIGIBILITY

      Awards may be granted to such Employees of the Bank and its Subsidiary
Companies as may be designated from time to time by the Committee. Awards may
not be granted to individuals who are not Employees or Non-Employee Directors of
either the Bank or its Subsidiary Companies. Non-Employee Directors shall be
eligible to receive only Non-Qualified Options pursuant to Section 8.02 of the
Plan.


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                                   ARTICLE VI
                        COMMON STOCK COVERED BY THE PLAN

      6.01 Option Shares. The aggregate number of shares of Common Stock which
may be issued pursuant to this Plan, subject to adjustment as provided in
Article IX, shall be 95,000 shares, which is equal to approximately 7.5% of the
issued and outstanding number of shares of Common Stock on the Effective Date.
None of such shares shall be the subject of more than one Award at any time, but
if an Option as to any shares is surrendered before exercise, or expires or
terminates for any reason without having been exercised in full, or for any
other reason ceases to be exercisable, the number of shares covered thereby
shall again become available for grant under the Plan as if no Awards had been
previously granted with respect to such shares.

      6.02 Source of Shares. The shares of Common Stock issued under the Plan
may be authorized but unissued shares, treasury shares or shares purchased by
the Bank on the open market or from private sources for use under the Plan.

                                   ARTICLE VII
                                DETERMINATION OF
                         AWARDS, NUMBER OF SHARES, ETC.

      The Committee shall, in its discretion, determine from time to time which
Employees will be granted Awards under the Plan, the number of shares of Common
Stock subject to each Award, whether each Option will be an Incentive Stock
Option or a Non-Qualified Stock Option and the exercise price of an Option. In
making all such determinations there shall be taken into account the duties,
responsibilities and performance of each respective Employee, his present and
potential contributions to the growth and success of the Bank, his salary and
such other factors as the Committee shall deem relevant to accomplishing the
purposes of the Plan. Non-Employee Directors shall be eligible to receive only
Non-Qualified Options pursuant to Section 8.02 of the Plan.

                                  ARTICLE VIII
                                  STOCK OPTIONS

      Each Option granted hereunder shall be on the following terms and
conditions:

      8.01 Stock Option Agreement. The proper Officers on behalf of the Bank and
each Optionee shall execute a Stock Option Agreement which shall set forth the
total number of shares of Common Stock to which it pertains, the exercise price,
whether it is a Non-Qualified Option or an Incentive Stock Option, and such
other terms, conditions, restrictions and privileges as the Committee in each
instance shall deem


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appropriate, provided they are not inconsistent with the terms, conditions and
provisions of this Plan. Each Optionee shall receive a copy of his executed
Stock Option Agreement.

      8.02  (a) Initial Grants to Non-Employee Directors. Each Non-Employee
Director of the Bank as of the day that the Plan is approved by stockholders of
the Bank shall be granted an Option to purchase 1,200 shares of Common Stock
effective at such time and with a per share exercise price equal to the Fair
Market Value of a share of Common Stock on such date.

            (b) Subsequent Grants. Each Non-Employee Director of the Bank shall
receive an Option to purchase 150 shares of Common Stock on each of the first
two annual anniversary dates after the date of the initial grants pursuant to
Section 8.02(a) at a per share exercise price equal to the Fair Market Value of
a share of Common Stock on such date.

            (c) New Non-Employee Directors. Each newly elected Non-Employee
Director during the term of this Plan not receiving initial grants pursuant to
Section 8.02(a), shall be granted an Option to purchase 1,200 shares of Common
Stock on the date of election to the Board and an Option to purchase 150 shares
of Common Stock on each of the first two annual anniversary dates of such
election at a per share exercise price equal to the Fair Market Value of a share
of Common Stock on such date.

            (d) Vesting and Exercise of Options. Options granted to Non-Employee
Directors shall be vested and exercisable over four years at the rate of 25
percent per year commencing one year from the date of grant.

      8.03 Option Exercise Price.

            (a) Incentive Stock Options. The per share price at which the
subject Common Stock may be purchased upon exercise of an Incentive Stock Option
shall be no less than one hundred percent (100%) of the Fair Market Value of a
share of Common Stock at the time such Incentive Stock Option is granted, except
as provided in Section 8.10(b).

            (b) Non-Qualified Options. The per share price at which the subject
Common Stock may be purchased upon exercise of a Non-Qualified Option shall be
established by the Committee at the time of grant, but in no event shall be less
than the greater of (i) the par value or (ii) one hundred percent (100%) of the
Fair Market Value of a share of Common Stock at the time such Non-Qualified
Option is granted.

      8.04 Vesting and Exercise of Options.

            (a) General Rules. Incentive Stock Options and Non-Qualified Options
granted to Employees shall become vested and exercisable at the rate, to the
extent and subject to such limitations as may be specified by the Committee,
provided, however, that in the case of any Option exercisable within


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the first six months following the date the Option is granted, the shares of
Common Stock received upon the exercise of such Option may not be sold or
disposed of by the Optionee for the first six months following the date of
grant. Options granted to Non-Employee Directors shall vest at the rate as set
forth in Section 8.02(d) hereof. Notwithstanding the foregoing, no vesting shall
occur on or after an Optionee's employment or service as a director with the
Bank and all Subsidiary Companies is terminated for any reason other than his
death, Disability or Retirement. In determining the number of shares of Common
Stock with respect to which Options are vested and/or exercisable, fractional
shares will be rounded up to the nearest whole number if the fraction is 0.5 or
higher, and down if it is less.

            (b) Accelerated Vesting Upon Death, Disability or Retirement. Unless
the Committee shall specifically state otherwise at the time an Option is
granted, all Options granted under this Plan shall become vested and exercisable
in full on the date an Optionee terminates his employment or service as a
director with the Bank or a Subsidiary Company because of his death, Disability
or Retirement.

            (c) Accelerated Vesting for Changes in Control. Notwithstanding the
general rule described in Section 8.04(a), all outstanding Options shall become
immediately vested and exercisable in the event there is a change in control of
the Bank. A "change in control of the Bank" for this purpose shall mean a change
in control of a nature that would be required to be reported in response to Item
6(e) of Schedule 14A of Regulation 14A promulgated under the Exchange Act, or
any successor thereto, whether or not the Bank in fact is required to comply
with Regulation 14A thereunder.

      8.05 Duration of Options.

            (a) General Rule. Except as provided in Sections 8.05(b) and 8.10,
each Option or portion thereof shall be exercisable at any time on or after it
vests and becomes exercisable until the earlier of (i) ten (10) years after its
date of grant or (ii) three (3) months after the date on which the Optionee
ceases to be employed by the Bank and all Subsidiary Companies or serve as a
director of the Bank, unless the Committee in its discretion decides at the time
of grant or thereafter to extend such period of exercise upon termination of
employment or service as a director from three (3) months to a period not
exceeding five (5) years.

            (b) Exception for Termination Due to Death, Disability or
Retirement. If an Optionee dies while in the employ or service as a director of
the Bank or a Subsidiary Company or terminates employment or service with the
Bank or a Subsidiary Company as a result of Disability or Retirement without
having fully exercised his Options, the Optionee or the executors,
administrators, legatees or distributees of his estate shall have the right,
during the twelve-month period following the earlier of his death, Disability or
Retirement, to exercise such Options to the extent vested on the date of such
death, Disability or Retirement. In no event, however, shall any Option be
exercisable more than ten (10) years from the date it was granted.


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      8.06 Nonassignability. Options shall not be transferable by an Optionee
except by will or the laws of descent or distribution, and during an Optionee's
lifetime shall be exercisable only by such Optionee or the Optionee's guardian
or legal representative.

      8.07 Manner of Exercise. Options may be exercised in part or in whole and
at one time or from time to time. The procedures for exercise shall be set forth
in the written Stock Option Agreement provided for in Section 8.01 above.

      8.08 Payment for Shares. Payment in full of the purchase price for shares
of Common Stock purchased pursuant to the exercise of any Option shall be made
to the Bank upon exercise of the Option. All shares sold under the Plan shall be
fully paid and nonassessable. Payment for shares may be made by the Optionee in
cash or, at the discretion of the Committee, by delivering shares of Common
Stock (including shares acquired pursuant to the exercise of an Option) or other
property equal in Fair Market Value to the purchase price of the shares to be
acquired pursuant to the Option, by withholding some of the shares of Common
Stock which are being purchased upon exercise of an Option, or any combination
of the foregoing.

      8.09 Voting and Dividend Rights. No Optionee shall have any voting or
dividend rights or other rights of a stockholder in respect of any shares of
Common Stock covered by an Option prior to the time that his name is recorded on
the Bank's stockholder ledger as the holder of record of such shares acquired
pursuant to an exercise of an Option.

      8.10 Additional Terms Applicable to Incentive Stock Options. All Options
issued under the Plan as Incentive Stock Options will be subject, in addition to
the terms detailed in Sections 8.01 to 8.09 above, to those contained in this
Section 8.10.

            (a) Notwithstanding any contrary provisions contained elsewhere in
this Plan and as long as required by Section 422 of the Code, the aggregate Fair
Market Value, determined as of the time an Incentive Stock Option is granted, of
the Common Stock with respect to which Incentive Stock Options are exercisable
for the first time by the Optionee during any calendar year, under this Plan and
stock options that satisfy the requirements of Section 422 of the Code under any
other stock option plan or plans maintained by the Bank (or any parent or
Subsidiary Company), shall not exceed $100,000.

            (b) Limitation on Ten Percent Stockholders. The price at which
shares of Common Stock may be purchased upon exercise of an Incentive Stock
Option granted to an individual who, at the time such Incentive Stock Option is
granted, owns, directly or indirectly, more than ten percent (10%) of the total
combined voting power of all classes of stock issued to stockholders of the Bank
or any Subsidiary Company, shall be no less than one hundred and ten percent
(110%) of the Fair Market Value of a share of the Common Stock of the Bank at
the time of grant, and such Incentive Stock Option shall by its terms not be
exercisable after the earlier of the date determined under Section 8.04 or the
expiration of five (5) years from the date such Incentive Stock Option is
granted.


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            (c) Notice of Disposition; Withholding; Escrow. An Optionee shall
immediately notify the Bank in writing of any sale, transfer, assignment or
other disposition (or action constituting a disqualifying disposition within the
meaning of Section 421 of the Code) of any shares of Common Stock acquired
through exercise of an Incentive Stock Option, within two (2) years after the
grant of such Incentive Stock Option or within one (1) year after the
acquisition of such shares, setting forth the date and manner of disposition,
the number of shares disposed of and the price at which such shares were
disposed of. The Bank shall be entitled to withhold from any compensation or
other payments then or thereafter due to the Optionee such amounts as may be
necessary to satisfy any withholding requirements of Federal or state law or
regulation and, further, to collect from the Optionee any additional amounts
which may be required for such purpose. The Committee may, in its discretion,
require shares of Common Stock acquired by an Optionee upon exercise of an
Incentive Stock Option to be held in an escrow arrangement for the purpose of
enabling compliance with the provisions of this Section 8.10(c).

                                   ARTICLE IX
                         ADJUSTMENTS FOR CAPITAL CHANGES

      The aggregate number of shares of Common Stock available for issuance
under this Plan, the number of shares to which any Award relates and the
exercise price per share of Common Stock under any Option shall be
proportionately adjusted for any increase or decrease in the total number of
outstanding shares of Common Stock issued subsequent to the effective date of
this Plan resulting from a split, subdivision or consolidation of shares or any
other capital adjustment, the payment of a stock dividend, or other increase or
decrease in such shares effected without receipt or payment of consideration by
the Bank. If, upon a merger, consolidation, reorganization, liquidation,
recapitalization or the like of the Bank, the shares of the Bank's Common Stock
shall be exchanged for other securities of the Bank or of another corporation,
each recipient of an Award shall be entitled, subject to the conditions herein
stated, to purchase or acquire such number of shares of Common Stock or amount
of other securities of the Bank or such other corporation as were exchangeable
for the number of shares of Common Stock of the Bank which such Optionees would
have been entitled to purchase or acquire except for such action, and
appropriate adjustments shall be made to the per share exercise price of
outstanding Options.

                                    ARTICLE X
                      AMENDMENT AND TERMINATION OF THE PLAN

      The Board may, by resolution, at any time terminate or amend the Plan with
respect to any shares of Common Stock as to which Awards have not been granted,
subject to any required stockholder approval or any stockholder approval which
the Board may deem to be advisable for any reason, such as for the purpose of
obtaining or retaining any statutory or regulatory benefits under tax,
securities or other laws or satisfying any applicable stock exchange listing
requirements. The Board may not, without the consent of the holder of an Award,
alter or impair any Award previously granted or awarded under this Plan as
specifically authorized herein. Notwithstanding anything contained in this


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Plan to the contrary, the provisions of Articles V, VII and VIII of this Plan
relating to Awards granted to Non-Employee Directors shall not be amended more
than once every six months, other than to comport with changes in the Code, the
Employee Retirement Income Security Act of 1974, as amended, or the rules and
regulations promulgated under such statutes.

                                   ARTICLE XI
                                EMPLOYMENT RIGHTS

      Neither the Plan nor the grant of any Awards hereunder nor any action
taken by the Committee or the Board in connection with the Plan shall create any
right on the part of any Employee or Non-Employee Director of the Bank or a
Subsidiary Company to continue in such capacity.

                                   ARTICLE XII
                                   WITHHOLDING

      12.01 Tax Withholding. The Bank may withhold from any cash payment made
under this Plan sufficient amounts to cover any applicable withholding and
employment taxes, and if the amount of such cash payment is insufficient, the
Bank may require the Optionee to pay to the Bank the amount required to be
withheld as a condition to delivering the shares acquired pursuant to an Award.
The Bank also may withhold or collect amounts with respect to a disqualifying
disposition of shares of Common Stock acquired pursuant to exercise of an
Incentive Stock Option, as provided in Section 8.10(c).

      12.02 Methods of Tax Withholding. The Committee is authorized to adopt
rules, regulations or procedures which provide for the satisfaction of an
Optionee's tax withholding obligation by the retention of shares of Common Stock
to which the Employee would otherwise be entitled pursuant to an Award and/or by
the Optionee's delivery of previously-owned shares of Common Stock or other
property.

                                  ARTICLE XIII
                        EFFECTIVE DATE OF THE PLAN; TERM

      13.01 Effective Date of the Plan. This Plan shall become effective on the
Effective Date, and Awards may be granted hereunder as of or after the Effective
Date and prior to the termination of the Plan, provided that no Incentive Stock
Option issued pursuant to this Plan shall qualify as such unless this Plan is
approved by the requisite vote of the holders of the outstanding voting shares
of the Bank at a meeting of stockholders of the Bank held within twelve (12)
months of the Effective Date.


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      13.02 Term of Plan. Unless sooner terminated, this Plan shall remain in
effect for a period of ten (10) years ending on the tenth anniversary of the
Effective Date. Termination of the Plan shall not affect any Awards previously
granted and such Awards shall remain valid and in effect until they have been
fully exercised or earned, are surrendered or by their terms expire or are
forfeited.

                                   ARTICLE XIV
                                  MISCELLANEOUS

      14.01 Governing Law. This Plan shall be construed under the laws of the
Commonwealth of Pennsylvania.

      14.02 Pronouns. Wherever appropriate, the masculine pronoun shall include
the feminine pronoun, and the singular shall include the plural.


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