Registration No. 333-             As filed with the Commission on June 28, 1999



                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

--------------------------------------------------------------------------------

                                    FORM S-8

                             REGISTRATION STATEMENT

                                     UNDER

                           THE SECURITIES ACT OF 1933

--------------------------------------------------------------------------------

                                Alliance Bancorp
             (Exact Name of Registrant as Specified in its Charter)

        Delaware                                          36-3811768
(State of Incorporation)                       (IRS Employer Identification No.)

                                One Grant Square
                            Hinsdale, Illinois 60521
             (Address of Principal Executive Offices and Zip Code)

                                --------------

          Alliance Bancorp 1997 Long-Term Incentive Stock Benefit Plan
       Liberty Bancorp, Inc. 1991 Stock Option Plan for Outside Directors
             Liberty Bancorp, Inc. 1991 Incentive Stock Option Plan
                           (Full Title of the Plans)



                                   Copies to:

       Kenne P. Bristol                           John J. Gorman, Esquire
President and Chief Executive Officer      Luse Lehman Gorman Pomerenk & Schick
       Alliance Bancorp                         A Professional Corporation
       One Grant Square                      5335 Wisconsin Ave., N.W., #400
     Hinsdale, Illinois 60521                     Washington, D.C. 20015
        (630) 323-1776                                 (202) 274-2000
(Name, Address and Telephone
 Number of Agent for Service)

                                ----------------

     If any of the securities being registered on this Form are to be offered on
a delayed or continuous  basis  pursuant to Rule 415 under the Securities Act of
1933 check the following box. [X]

<PAGE>


                        CALCULATION OF REGISTRATION FEE

<TABLE>

========================---------------------------------------------------------------------=======================
<CAPTION>

                                               Proposed Maximum       Proposed Maximum
Title of Securities to  Amount to be           Offering Price Per     Aggregate Offering     Amount of
be Registered           Registered (1)         Share                  Price                  Registration Fee
========================---------------------------------------------------------------------=======================
<S>                     <C>                    <C>                    <C>                    <C>
Common Stock,
par value $0.01
per share               391,967 shares (2)     $21.84 (3)             $8,560,559             $2,380
========================---------------------------------------------------------------------=======================
Common Stock,
par value $0.01
per share               208,033 shares (4)     $23.13(3)              $4,811,803             $1,338
========================---------------------------------------------------------------------=======================
Common Stock,
par value $0.01
per share               244,123 shares (5)     $5.37 (3)              $1,310,941             $364
========================---------------------------------------------------------------------=======================
Common Stock,
par value $0.01
per share               321,150 shares (6)     $12.29 (3)             $3,946,551             $1,097
====================================================================================================================
Total                   1,165,273 shares                              $18,629,854            $5,179
====================================================================================================================
</TABLE>

_____________

(1)  Together with an  indeterminate  number of  additional  shares which may be
     necessary to adjust the number of shares reserved for issuance  pursuant to
     the  Alliance  Bancorp 1997  Long-Term  Incentive  Stock  Benefit Plan (the
     "Stock Benefit Plan"), the Liberty Bancorp, Inc. 1991 Stock Option Plan for
     Outside Directors (the "Directors Plan") and the Liberty Bancorp, Inc. 1991
     Incentive  Stock  Benefit  Plan (the  "Incentive  Plan") as the result of a
     stock split, stock dividend or similar adjustment of the outstanding Common
     Stock of Alliance Bancorp pursuant to 17 C.F.R. Section 230.416(a).

(2)  Represents the number of shares currently reserved for issuance pursuant to
     option  granted  pursuant to the Stock Benefit Plan.

(3)  Determined  by the  exercise  price of the  options  pursuant  to 17 C.F.R.
     Section 230.457(h)(1).

(4)  Represents the number of shares currently reserved for issuance pursuant to
     options reserved for award pursuant to the Stock Benefit Plan.

(5)  Represents the number of shares currently reserved for issuance pursuant to
     options granted pursuant to the Directors Plan.

(6)  Represents the number of shares currently reserved for issuance pursuant to
     options granted pursuant to the Incentive Plan.



                          ----------------------------
     This   Registration   Statement  shall  become  effective  upon  filing  in
accordance  with Section 8(a) of the  Securities  Act of 1933 and 17 C.F.R.  ss.
230.462.
<PAGE>


PART I.

Items 1 and 2. Plan  Information  and Registrant  Information  and Employee Plan
Annual Information

     The documents  containing the  information  specified in Part I of Form S-8
will be sent or given to  participants  in the  Alliance  Bancorp1997  Long-Term
Incentive  Stock Benefit Plan (the "Stock Benefit Plan"),  the Liberty  Bancorp,
Inc. 1991 Stock Option Plan for Outside Directors (the "Directors Plan") and the
1991 Liberty Bancorp,  Inc.  Incentive Stock Option Plan (the "Incentive  Plan,"
and, collectively the "Plans") as specified by Rule 428(b)(1) promulgated by the
Securities and Exchange  Commission (the "Commission")  under the Securities Act
of 1933, as amended (the "Securities Act").

     Such  documents  are not being filed with the  Commission,  but  constitute
(along  with the  documents  incorporated  by  reference  into the  Registration
Statement  pursuant  to Item 3 of Part II  hereof) a  prospectus  that meets the
requirements of Section 10(a) of the Securities Act.

PART II.

Item 3. Incorporation of Documents by Reference

     The  following  documents  previously  or  concurrently  filed by  Alliance
Bancorp (the "Company") with the Commission are hereby incorporated by reference
in this Registration Statement:

(a)  the Company's Annual Report on Form 10-K for the fiscal year ended December
     31, 1998 (File No.  0-20082) filed pursuant to Rule 13a-1 of the Securities
     Exchange Act of 1934, as amended (the "Exchange Act");

(b)  all other reports  filed by the Company  pursuant to Section 12 or 15(d) of
     the  Exchange  Act since the end of the fiscal  year  covered by the Annual
     Report referred to above;

(c)  the  Company's  definitive  proxy  statement  for  its  Annual  Meeting  of
     Stockholders  held on May 28, 1997, as filed with the  Commission on May 2,
     1997;

(d)  the  description  of the common  stock,  par value $0.01 per share,  of the
     Company  contained  in the  Company's  Registration  Statement  on Form S-1
     (Registration  No.  333-46877)  filed with the Commission on March 31, 1992
     and all  amendments  or  reports  filed for the  purpose of  updating  such
     description.

     All  documents  subsequently  filed  by the  Company  with  the  Commission
pursuant to Sections 13(a),  13(c),  14, or 15(d) of the Exchange Act, after the
date  hereof,  and  prior to the  filing  of a  post-effective  amendment  which
indicates that all securities offered hereby have been sold or which deregisters
all securities then remaining unsold,  shall be deemed incorporated by reference
into this  Registration  Statement and to be a part thereof from the date of the
filing of such documents. Any statement contained in the documents incorporated,
or deemed to be incorporated,  by reference herein or therein shall be deemed to
be modified or superseded  for purposes of this  Registration  Statement and the
Prospectus to the extent that a statement  contained herein or therein or in any
other   subsequently  filed  document  which  also  is,  or  is  deemed  to  be,
incorporated  by  reference  herein  or  therein  modifies  or  supersedes  such
statement.  Any such  statement so modified or  superseded  shall not be deemed,
except as so modified or superseded,  to constitute a part of this  Registration
Statement and the prospectus.

     The  Company  shall  furnish  without  charge  to each  person  to whom the
prospectus is delivered,  on the written or oral request of such person,  a copy
of any or all of the documents incorporated by reference, other than exhibits to
such documents (unless such exhibits are specifically  incorporated by reference
to the information that is  incorporated).  Requests should be directed to Kenne
P. Bristol,  President and Chief Executive Officer,  Alliance Bancorp, One Grant
Square, Hinsdale, Illinois, 60521 telephone number (630) 323-1776.


<PAGE>

     All information appearing in this Registration Statement and the prospectus
is qualified in its entirety by the detailed  information,  including  financial
statements,  appearing  in the  documents  incorporated  herein  or  therein  by
reference.

Item 4. Description of Securities

Not applicable.

Item 5. Interests of Named Experts and Counsel

None.

Item 6. Indemnification of Directors and Officers

     Directors and officers of the Registrant are  indemnified and held harmless
against liability to the fullest extent  permissible by the general  corporation
law of Delaware as it  currently  exists or as it may be amended,  provided  any
such  amendment  provides  broader  indemnification  provisions  than  currently
exists. This  indemnification  applies to the directors who administer the Stock
Benefit Plan, the Directors Plan and the Incentive Plan.

     The  terms  of the  indemnification  are  set  forth  in  the  Registrant's
Certificate of Incorporation.  The  indemnification  applies unless the director
did not meet the  standards  of  conduct  which  make it  permissible  under the
general corporation law of Delaware for the Registrant to indemnify the director
for the  amount  claimed,  but the  burden of  proving  such  defense  is on the
Registrant.

     The Registrant is also permitted under the Certificate of Incorporation to
maintain directors' and officers' liability insurance covering its directors and
officers and has obtained a directors' and officers'  liability and  corporation
reimbursement  policy which (subject to certain limitations and deductibles) (i)
insured  officers  and  directors  of the  Registrant  against loss arising from
certain  claims made  against  them by reason of their being such  directors  or
officers;  and (ii) insures the Registrant against loss which it may be required
or permitted to pay as indemnification to its directors and officers for certain
claims.

     Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors,  officers or persons  controlling the Registrant,
the  Registrant  has been  informed that in the opinion of the  Commission  such
indemnification  is against public policy as expressed in the Securities Act and
is therefore unenforceable.

Item 7. Exemption From Registration Claimed.

Not applicable.

<PAGE>

Item 8. List of Exhibits.
<TABLE>
<CAPTION>

Regulation S-K                                                         Reference to Prior Filing or
Exhibit Number                      Document                           Exhibit No. Attached Hereto

    <S>              <C>                                                        <C>
    3.1              Certificate of Incorporation of Alliance Bancorp            *

    3.2              Bylaws of Alliance Bancorp                                  *

     4               Specimen form of common stock certificate
                     of Alliance Bancorp                                         *

     5               Opinion of Luse Lehman Gorman Pomerenk
                     & Schick, P.C.                                           Exhibit 5

    10.1             Alliance Bancorp 1997 Long-Term Incentive
                     Stock Benefit Plan                                         **

    10.2             Liberty Bancorp, Inc. 1991 Stock Option
                     Plan for Outside Directors                              Exhibit 10.2

    10.3             Liberty Bancorp, Inc. 1991 Incentive
                     Stock Option Plan                                       Exhibit 10.3

    23.1             Consent of Luse Lehman Gorman Pomerenk
                     & Schick, P.C.                                     Contained in Exhibit 5

    23.2             Consent of KPMG LLP                               Attached as Exhibit 23.2

    24               Power of Attorney                                Contained on Signature Page
</TABLE>



     *    Filed as exhibits to the Registrant's  Registration  Statement on Form
          S-1 (File No.  333-46877)  filed with the Commission on March 31, 1992
          pursuant to Section 5 of the Securities Act of 1933 and all amendments
          thereto or reports filed for the purpose of updating such description.
          All of such previously filed documents are hereby  incorporated herein
          by reference in accordance  with Item 601 of Regulation  S-K.
     **   Filed as an exhibit to the  Registrant's  Proxy Statement  relating to
          the Registrant's  May 28, 1997 annual meeting of  stockholders,  filed
          with the Commission on May 2, 1997,  which is  incorporated  herein by
          reference.


Item 9. Undertakings

         The undersigned Registrant hereby undertakes:

1.   To file,  during  any  period in which  offers or sales are being  made,  a
     post-effective  amendment  to this  Registration  Statement  to include any
     material  information  with  respect  to  the  Registration  Statement  not
     previously disclosed in this Registration  Statement or any material change
     to such information in this Registration Statement;

2.   That, for the purpose of determining any liability under the Securities Act
     of 1933,  each such  post-effective  amendment  shall be deemed to be a new
     Registration  Statement relating to the securities offered therein, and the
     offering of such  securities at that time shall be deemed to be the initial
     bona fide offering thereof;

3.   To remove from  registration by means of a post-effective  amendment any of
     the securities  being  registered which remain unsold at the termination of
     the Stock Benefit Plan, the Directors Plan and the Incentive Plan and

<PAGE>

4.   That, for purposes of determining any liability under the Securities Act of
     1933,  each filing of the  Registrant's  annual report  pursuant to Section
     13(a) or 15(d) of the Securities  Exchange Act of 1934 that is incorporated
     by  reference  in the  Registration  Statement  shall be deemed to be a new
     Registration  Statement relating to the securities offered therein, and the
     offering of such  securities at that time shall be deemed to be the initial
     bona fide offering thereof.

5.   Insofar as indemnification for liabilities arising under the Securities Act
     of 1933 may be permitted to directors,  officers and controlling persons of
     the  Registrant  pursuant to the foregoing  provisions,  or otherwise,  the
     Registrant  has been  advised  that in the  opinion of the  Securities  and
     Exchange  Commission  such  indemnification  is  against  public  policy as
     expressed in the Act and is, therefore,  unenforceable. In the event that a
     claim for indemnification  against such liabilities (other than the payment
     by the  Registrant of expenses  incurred or paid by a director,  officer or
     controlling  person of the  Registrant  in the  successful  defense  of any
     action,  suit or  proceeding)  is  asserted  by such  director,  officer or
     controlling person in connection with the securities being registered,  the
     Registrant  will,  unless in the opinion of its counsel the matter has been
     settled  by  controlling  precedent,  submit  to  a  court  of  appropriate
     jurisdiction  the question  whether such  indemnification  by it is against
     public  policy as  expressed  in the Act and will be  governed by the final
     adjudication of such issue.
<PAGE>

<TABLE>
                           EXHIBIT INDEX
<CAPTION>


Exhibit Number             Description

     <S>                   <C>
      5                    Opinion of Luse Lehman Gorman Pomerenk & Schick, A Professional Corporation
                           as to the legality of the Common Stock registered hereby.

    10.2                   Liberty Bancorp, Inc. 1991 Stock Option Plan for Outside Directors

    10.3                   Liberty Bancorp, Inc. 1991 Incentive Stock Option Plan

    23.1                   Consent of Luse Lehman Gorman Pomerenk & Schick, P.C.
                           (contained in the opinion included as Exhibit 5)

    23.2                   Consent of KPMG LLP

</TABLE>
<PAGE>


                                   SIGNATURES

     The Registrant. Pursuant to the requirements of the Securities Act of 1933,
the registrant certifies that it has reasonable grounds to believe that it meets
all of the  requirements  for  filing  on  Form  S-8 and has  duly  caused  this
registration statement to be signed on its behalf by the undersigned,  thereunto
duly authorized,  in the City of Hinsdale, State of Illinois, on this 25thday of
June, 1999.



                                    ALLIANCE BANCORP


                                    By: /s/ Kenne P. Bristol
                                        Kenne P. Bristol
                                        President and Chief
                                        Executive Officer
                                        (Duly Authorized Representative)



                               POWER OF ATTORNEY



     We, the  undersigned  directors  and  officers  of  Alliance  Bancorp  (the
"Company") hereby severally  constitute and appoint Kenne P. Bristol as our true
and  lawful  attorney  and  agent,  to do any and all things in our names in the
capacities  indicated  below which said Kenne P.  Bristol may deem  necessary or
advisable to enable the Company to comply with the  Securities  Act of 1933, and
any  rules,   regulations  and  requirements  of  the  Securities  and  Exchange
Commission, in connection with the registration statement on Form S-8, including
specifically,  but not limited  to,  power and  authority  to sign for us in our
names in the capacities  indicated below the registration  statement and any and
all amendments  (including  post-effective  amendments)  thereto;  and we hereby
approve,  ratify and confirm all that said Kenne P. Bristol shall do or cause to
be done by virtue thereof.

     Pursuant  to  the   requirements  of  the  Securities  Act  of  1933,  this
registration  statement  has  been  signed  by  the  following  persons  in  the
capacities and on the date indicated.

By: /s/ Kenne P. Bristol                     By: /s/ Edward J. Burns
Kenne P. Bristol, President                      Edward J. Burns, Director
Chief Executive Officer and Director
(Principal Executive Officer)


Date: June 25, 1999                          Date: June 25, 1999



By: /s/ Richard A. Hojnicki                  By: /s/ Howard A. Davis
Richard A. Hojnicki, Executive Vice              Howard A. Davis, Director
President, Chief Financial Officer
and Corporate Secretary
(Principal Financial Officer)

Date: June 25, 1999                          Date: June 25, 1999


By: /s/ Ilene M. Bock                        By: /s/ Whit G. Hughes
Ilene M. Bock, Senior Vice President             Whit G. Hughes, Director
and Controller
Principal Accounting Officer)

Date: June 25, 1999                          Date: June 25, 1999


By: /s/ Fredric G. Novy                      By: /s/ Howard R. Jones
Fredric G. Novy, Chairman of the Board           Howard R. Jones, Director

Date: June 25, 1999                          Date: June 25, 1999
<PAGE>


By: /s/ H. Verne Loeppert                    By: /s/ David D. Mill
H. Verne Loeppert, Director                      David D. Mill, Director

Date: June 25, 1999                          Date: June 25, 1999


By: /s/ Edward J. Nusrala                    By: /s/ William C. O'Donnell
Edward J. Nusrala, Director                      William C. O'Donnell, Director


Date: June 25, 1999                          Date: June 25, 1999


By: /s/ William R. Rybak                     By: /s/ Russell F. Stephens, Jr.
William R. Rybak, Director                       Russell F. Stephens, Jr.,
                                                 Director


Date: June 25, 1999                          Date: June 25, 1999


By: /s/ Donald E. Sveen                      By: /s/ Vernon B. Thomas, Jr.
Donald E. Sveen, Director                        Vernon B. Thomas, Jr., Director


Date: June 25, 1999                          Date: June 25, 1999


By: /s/ Richard E. Webber
Richard E. Webber, Director


Date: June 25, 1999


<PAGE>























                                   EXHIBIT 5



             OPINION OF LUSE LEHMAN GORMAN POMERENK & SCHICK, P.C.















<PAGE>



           [LETTERHEAD OF LUSE LEHMAN GORMAN POMERENK & SCHICK, P.C.]


June 28, 1999                                                     (202) 274-2000


Board of Directors
Alliance Bancorp
One Grant Square
Hinsdale, Illinois 60521

Re:Alliance Bancorp Registration Statement on Form S-8

Ladies and Gentlemen:

     You have  requested  the  opinion  of this firm as to  certain  matters  in
connection with the offer and sale of Alliance  Bancorp (the  "Company")  common
stock, par value $0.01 per share (the "Common Stock"),  pursuant to the Alliance
Bancorp 1997 Long-Term  Incentive Stock Benefit Plan, the Liberty Bancorp,  Inc.
1991 Stock Option Plan for Outside Directors and the 1991 Liberty Bancorp,  Inc.
1991 Incentive  Stock Option Plan (the "Plans").  We have reviewed the Company's
Certificate  of  Incorporation,  Registration  Statement  on Form S-8 (the "Form
S-8"), as well as applicable statutes and regulations  governing the Company and
the offer and sale of the Common Stock.

     Based on the foregoing, we are of the following opinion:

     Upon the  effectiveness  of the Form S-8,  the Common  Stock,  when sold in
     connection with the exercise of options granted pursuant to the Plans, will
     be legally issued, fully paid and non-assessable.

     This  opinion  has  been  prepared  solely  for the use of the  Company  in
connection  with the  preparation  and filing of the Form S-8, and should not be
used for any other purpose or relied upon by any other person  without the prior
written  consent of this firm.  We hereby  consent to the use of this opinion in
the Form S-8.

                                        Very truly yours,

                                        /s/ Luse Lehman Gorman Pomerenk & Schick
                                        LUSE LEHMAN GORMAN POMERENK & SCHICK
                                        A Professional Corporation


<PAGE>













                                  EXHIBIT 10.2



                             LIBERTY BANCORP, INC.

                  1991 STOCK OPTION PLAN FOR OUTSIDE DIRECTORS



















<PAGE>

                             AMENDMENT NO. 1 TO THE
                             LIBERTY BANCORP, INC.
                           1991 STOCK OPTION PLAN FOR
                               OUTSIDE DIRECTORS


     WHEREAS, the Board of Directors ("Board") of Liberty Bancorp,  Inc. desires
to amend the Liberty Bancorp,  Inc. 1991 Stock Option Plan for Outside Directors
(the "Plan") to conform to the new rules adopted by the  Securities and Exchange
Commission (SEC) as they relate to Section 16 of the Securities  Exchange Act of
1934 ;

     WHEREAS,  Section VII of the Plan  permits the Plan to be amended from time
to time subject to the Securities and Exchange Commission Rule 16b-3;

     WHEREAS,   Rule  16b-3  no  longer  requires   shareholder  approval  as  a
prerequisite to any  modification or amendment that affects the grant,  award or
other acquisition from an issuer;

     NOW,  THEREFORE,  BE IT  RESOLVED,  that the Plan  shall be, and hereby is,
amended effective as of September 1, 1996, in accordance with the following:

     A new  Section 1A.  Plan  Administration  is added to the Plan and reads as
follows:

               The Plan shall be administered by the Committee.  For purposes of
          this Directors' Option Plan, "Committee" shall mean a Committee of the
          Board consisting of either (i) at least two Non-Employee  Directors of
          the Company,  or (ii) the entire  Board of the Company.  "Non-Employee
          Director"  means,  for purposes of the Plan, a Director who (a) is not
          employed  by  the  Company  or an  affiliate;  (b)  does  not  receive
          compensation  directly or indirectly as a consultant  (or in any other
          capacity than as a Director)  greater than $60,000;  (c) does not have
          an interest in a transaction requiring disclosure under Item 404(a) of
          Regulation S-K; or (d) is not engaged in a business  relationship  for
          which  disclosure  would  be  required  pursuant  to  Item  404(b)  of
          Regulation S-K.

               The  Committee is  authorized,  subject to the  provisions of the
          Plan, to establish such rules and  regulations  as it deems  necessary
          for  the  proper  administration  of the  Plan  and to  make  whatever
          determinations  and  interpretations  in  connection  with the Plan it
          deems necessary or advisable.  All determinations and  interpretations
          made  by  the  Committee  shall  be  binding  and  conclusive  on  all
          Participants  in the  Plan  and on  their  legal  representatives  and
          beneficiaries.

               All transactions  involving a grant,  award or other  acquisition
          from the Company shall:

               (a)  be approved by the Company's full Board or by the Committee;


<PAGE>

               (b)  be approved,  or ratified,  in compliance with Section 14 of
                    the Exchange  Act, by either:  the  affirmative  vote of the
                    holders  of  a  majority  of  the  securities   present,  or
                    represented  and  entitled to vote at a meeting duly held in
                    accordance  with the laws of the state in which the  Company
                    is incorporated;  or the written consent of the holders of a
                    majority of the  securities  of the issuer  entitled to vote
                    provided  that such  ratification  occurs no later  than the
                    date of the next annual meeting of shareholders; or

               (c)  result in the  acquisition  of an option that is held by the
                    individual for a period of six months  following the date of
                    such acquisition.

II(b)  Grants to  Subsequent  Outside  Directors  is  amended to read in full as
follows:

          The  Committee  may,  from  time to time,  grant  non-statutory  stock
     options to Outside  Directors,  and, upon such terms and  conditions as the
     Committee may determine,  grant non-statutory stock options in exchange for
     and upon surrender of previously granted options under the Plan.

II(d) Exercise Price is amended to read in full as follows:

          The  purchase  price per share of Common  Stock  deliverable  upon the
     exercise of each  non-statutory  stock  option shall be  determined  by the
     Committee  on the date the option is  granted.  In general,  such  purchase
     price  shall not be less than 100% of the Fair  Market  Value of the Common
     Stock on the date of grant.  The  purchase  price per share of Common Stock
     deliverable upon the exercise of each non-statutory stock option granted in
     exchange for and upon surrender of previously  granted options shall be not
     less than 85% of the Fair Market  Value of the Common  Stock on the date of
     grant,  but in no event may the purchase price of any  non-statutory  stock
     option  be less  than the par  value of the  Common  Stock.  Shares  may be
     purchased  only upon full  payment of the  purchase  price.  Payment of the
     purchase  price may be made, in whole or in part,  through the surrender of
     shares of the Common  Stock at the Fair Market  Value of such shares on the
     date of surrender determined in the manner described in Section II(f).

III(d) Transferability is amended to read in full as follows:

          In the discretion of the Board, all or any non-statutory  stock option
     granted  hereunder may be transferable by the Outside  Director;  provided,
     however,  that the Board may limit the  transferability  of such  option or
     options to a designated class or classes of persons.

<PAGE>

VI.  Termination  of the Plan is  amended  by  replacing  the last  sentence  as
follows:

          The Board may suspend or terminate the Plan at any time, provided that
     no such action will, without the consent of the affected individual, affect
     such individual's rights under a previously granted option.

VII. Amendment of the Plan is amended to read in full as follows:

          The Board may at any time, and from time to time,  modify or amend the
     Plan in any  respect,  or  modify or amend an option  received  by  Outside
     Directors;  provided,  however,  that no such termination,  modification or
     amendment  may affect the rights of an  individual,  without  his  consent,
     under an outstanding  option.  Any amendment or modification of the Plan or
     an outstanding  option under the Plan shall be approved by the Committee or
     the full Board of the Company.

<PAGE>


                             LIBERTY BANCORP, INC.

                  1991 STOCK OPTION PLAN FOR OUTSIDE DIRECTORS

I. Purpose

     The purpose of the Liberty Bancorp, Inc. 1991 Stock Option Plan for Outside
Directors  (the  "Directors'   Option  Plan")  is  to  promote  the  growth  and
profitability  of Liberty  Bancorp,  Inc. (the  "Company")  and Liberty  Federal
Savings Bank (the "Bank"), its subsidiary, by providing an incentive in the form
of stock options to attract and retain non-employee  directors of the Company of
outstanding  competence  and to achieve  long-term  objectives of the Company by
encouraging their acquisition of an equity interest in the Company.

II. Grant of Options

     (a) Initial Grant.  Each outside  director (for purposes of this Directors'
Option Plan,  the term  "Outside  Director"  shall mean a member of the Board of
Directors  of the Company not also  serving as an employee of the Company or its
subsidiary),  who is  serving  in such  capacity  on the  date of the  Company's
initial  public  offering and at the effective  date of this  Directors'  Option
Plan, shall be granted  non-statutory stock options to purchase 31,409 shares of
the common stock of the Company ("Common Stock") subject to adjustment  pursuant
to Section IV hereof. Options granted under this paragraph shall be effective as
of the effective date as defined in Section V hereof ("Effective Date").

     (b) Grants to  Subsequent  Outside  Directors.  To the extent  options  for
shares are  available for grants under this Plan,  each Outside  Director who is
first  elected as a  director  subsequent  to the  Effective  Date  ("Subsequent
Outside Director") is hereby granted, effective as of the first day of the month
following the month in which the  Subsequent  Outside  Director is qualified and
first begins to serve as an Outside  Director,  non-statutory  stock  options to
purchase 1,653 shares of Common Stock, subject to adjustment pursuant to Section
IV, or to  purchase  such lesser  number of shares as remain in this  Directors'
Option Plan.

     If  options  for  sufficient  shares  are not  available  under the Plan to
fulfill the grant of options under Section II(b) hereof to a Subsequent  Outside
Director and  thereafter  options  become  available,  such  Subsequent  Outside
Director  shall then  receive  options to purchase an amount of shares of Common
Stock,  determined  by  dividing  pro rata  among each such  Subsequent  Outside
Director the number of options for shares then  available  under the  Directors'
Option Plan (not to exceed 1,653 shares,  subject to  adjustment,  as to any one
Subsequent  Outside  Director).  The date of grant shall be the date options for
such shares become available.

     (c) Ineligibility. An option under this Directors' Option Plan shall not be
granted to any  Outside  Director  who at any  previous  time was an employee of
either the Company or the Bank and in such  capacity was eligible to receive any
options to purchase Common Stock.

<PAGE>


     (d)  Exercise  Price.  The  exercise  price per share of the  Common  Stock
deliverable  upon  the  exercise  of each  non-statutory  stock  option  granted
pursuant to Section II(a) and II(b) hereof shall be determined as of the date of
the exercise of such option, at the discretion of the recipient, pursuant to the
formula provided in (i) or (ii) below:

               (i) The exercise price per share of the Common Stock  deliverable
          upon the exercise of each non-statutory stock option shall be equal to
          85% of the Fair Market Value of the Common Stock on the date of grant;
          provided  that the  recipient  agrees  as of the date  the  option  is
          exercised  to hold the stock  acquired  through  the  exercise  of the
          option for a period of one year and a legend appropriately restricting
          sale is placed upon the stock certificate(s) representing such shares,
          except that such restriction  shall not apply in the event of a tender
          offer or surrender of the stock in connection with a Change of Control
          (as defined in Section  II(e)  hereof) of the Company or in connection
          with a merger,  reorganization  or other similar  transaction in which
          the Company  ceases to  survive.  A legend  appropriately  restricting
          transfer  shall be placed upon the stock  certificate(s)  representing
          such shares.

               (ii) The exercise price per share of the Common Stock deliverable
          upon the exercise of each non-statutory stock option shall be equal to
          the Fair Market Value of the Common Stock on the date of grant.

     (e) Change in Control. For purposes of the Directors' Option Plan, a Change
in Control of the Company means a change in control of a nature that:  (i) would
be required  to be reported in response to Item 1 of the current  report on form
8-K,  as in effect on the date  hereof,  pursuant  to Section 13 or 15(d) of the
Securities  Exchange  Act of 1934 (the  "Exchange  Act");  or (ii)  results in a
change in  "control"  of the Bank or the Company  within the meaning of the Home
Owners Loan Act of 1933 and the Rules and Regulations  promulgated by the Office
of Thrift Supervision (or its predecessor agency), as in effect on the effective
date of this Plan. In addition to the above, a change in control shall be deemed
to have occurred at such time and payments and benefits under this Section shall
be made as (iii) any "person" (as the term is used in Section 13(d) and 14(d) of
the Exchange Act) is or becomes the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act),  directly or  indirectly,  of securities of the Bank or
the Company representing 20% or more of the Bank's or the Company's  outstanding
securities  ordinarily  having the right to vote at the  election  of  directors
except  for any  securities  of the Bank  purchased  by the  Company as the sole
stockholder  of the Bank and any  securities  purchased  by the Bank's  employee
stock ownership plan and trust; or (iv)  individuals who constitute the Board on
the date hereof (the  "Incumbent  Board")  cease for any reason to constitute at
least  a  majority  thereof,  provided  that  any  person  becoming  a  director
subsequent to the date hereof whose  election was approved by a vote of at least
three-quarters  of the  directors  comprising  the  Incumbent  Board,  or  whose
nomination for election by the Company's  shareholders  was approved by the same
nominating committee serving under an Incumbent Board, shall be, for purposes of
this clause (iv),  considered as though he were a member of the Incumbent Board;
or (v) a merger, consolidation or sale of all or substantially all the assets of
the Bank or the
<PAGE>

Company in which the Bank or Company is not the surviving institution occurs; or
(vi) a proxy statement  soliciting  proxies from the stockholders of the Company
by someone other than the current management of the Company, seeking stockholder
approval of a plan of reorganization,  merger or consolidation of the Company or
Bank or similar  transaction with one or more  corporations as a result of which
the  outstanding  shares of the class of securities  then subject to the plan of
reorganization  are  exchanged  for  or  converted  into  cash  or  property  or
securities not issued by the Bank or the Company shall be distributed;  or (vii)
a tender offer is made for 20% or more of the voting  securities  of the Bank or
the Company.

     (f) Fair Market Value.  For purposes of the  Directors'  Option Plan,  when
used in connection  with Common Stock on a certain date, Fair Market Value means
the average of the  reported  bid and ask prices of the Common Stock as reported
by the National Association of Securities Dealers Automated Quotation System (as
published by the Wall Street  Journal,  if  published)  on such date,  or if the
Common Stock was not traded on such date, on the next preceding day on which the
Common  Stock was traded  thereon.  For  purposes of the grant of options in the
Conversion  as defined in Section V hereof,  Fair  Market  Value  shall mean the
initial public offering price of the Common stock or $10.00 per share.

III. Terms and Conditions

     (a) Option  Agreement.  Each option shall be evidenced by a written  option
agreement  between the Company and the director  specifying the number of shares
of Common Stock that may be acquired  through its exercise and  containing  such
other terms and  conditions  which are not  inconsistent  with the terms of this
grant.

     (b) Termination of Option. Each option shall expire upon the earlier of (i)
one hundred and twenty (120) months following the date of grant, or (ii) one (1)
year  following the date on which the outside  director  ceases to serve in such
capacity for any reason other than Cause.  If the Outside  Director  dies before
fully exercising any portion of an option then  exercisable,  such option may be
exercised  by such  Outside  Director's  personal  representatives),  heir(s) or
devisee(s) for the period specified in (ii) above; provided, however, that in no
event shall the option be  exercisable  more than one  hundred and twenty  (120)
months after the date of its grant.  If the Outside  Director is terminated  for
Cause all options awarded to him shall expire upon such termination.

     For  purposes  of  this  paragraph,  termination  for  "Cause"  shall  mean
termination  because of a  material  loss to the  Holding  Company or one of its
affiliates  caused  by  the  Outside  Director's  personal  dishonesty,  willful
misconduct,  breach of fiduciary duty  involving  personal  profit,  intentional
failure to perform  stated  duties or the willful  violation of any law, rule or
regulation or final cease-and-desist order.

     (c) Manner of Exercise.  The option may be exercised  from time to time, in
whole or in part,  by  delivering  a  written  notice of  exercise  to the Chief
Executive  Officer  of the  Company.  Such  notice  is  irrevocable  and must be
accompanied  by full payment of the  exercise  price (as
<PAGE>

determined  by Section  II(d)  herein) in cash or share of  previously  acquired
Common Stock of the Company.  If previously  acquired shares of Common Stock are
tender in payment of all or part of the exercise price, the value of such shares
shall be determined as of the date of such exercise.

     (d)  Transferability.  Each option  granted hereby may be exercised only by
the  Outside  Director  to whom it is  issued  or in the  event  of the  Outside
Director's death, his or her personal  representative(s),  heir(s) or devisee(s)
pursuant to the terms of Section III(b).

IV. Common Stock Subject to the Director's Option Plan

     The shares  which shall be issued and  delivered  upon  exercise of options
granted under the Directors'  Option Plan may be either  authorized and unissued
shares of Common Stock or  authorized  and issued shares of Common Stock held by
the Company as treasury stock. The number of shares of Common Stock reserved for
issuance under the Directors' Option Plan shall not exceed 5.0% of the number of
shares of the Common Stock of the Company,  par value $.01 per share,  issued in
connection with the Conversion (165,312 shares), subject to adjustments pursuant
to this  Section IV. Any shares of Common  Stock  subject to an option which for
any reason either  terminates  unexercised or expires,  shall again be available
for issuance under the Directors' Option PLAN.

     In the event of any change or changes in the  outstanding  Common  Stock of
the  Company  by  reason  of any  stock  dividend  or  split,  recapitalization,
reorganization,  merger,  consolidation,  spin-off,  combination  or any similar
corporate  change, or other increase or decrease in such shares effected without
receipt or  payment of  consideration  by the  Company,  the number of shares of
Common Stock which may be issued under this  Directors'  Option Plan, the number
of shares of Common  Stock  subject to  options  granted  under this  Directors'
Option  Plan,  and the  option  price of such  options,  shall be  automatically
adjusted to prevent  dilution or enlargement of the rights granted to an Outside
Director under the Directors' Option Plan.

V. Effective Date of the Plan; Shareholder Ratification

     The Directors'  Option Plan after adoption by the Board of Directors  shall
become  effective  upon the  conversion  of the Bank from the  mutual to capital
stock  form  of  ownership  and  the  acquisition  of the  Bank  by the  Company
("Conversion").  Following  Conversion,  the  Directors'  Option  Plan  shall be
presented to  shareholders of the Company for  ratification  for purposes of (i)
obtaining favorable treatment under Section 16(b) of the Securities Exchange Act
of 1934  (the  "Exchange  Act");  and (ii)  maintaining  listing  on the  NASDAQ
National  Market  System;   provided,   however,  that  the  failure  to  obtain
shareholder  ratification  shall not  affect the  validity  of this Plan and the
options granted thereunder.


<PAGE>

VI. Termination of the Plan

     The right to grant options under the Directors'  Option Plan will terminate
upon the  earlier  of ten years  after the  Effective  Date of the Plan,  or the
issuance  of 165,312  shares of Common  Stock (the  maximum  number of shares of
Common Stock reserved for under this Plan). A majority of the outstanding shares
of the Common  Stock  entitled to vote is required to terminate  the  Director's
Option Plan;  provided,  however, no such termination shall, without the consent
of the affected  individual,  affect such individual's rights under a previously
granted option.

VII. Amendment of the Plan

     The Directors' Option Plan may be amended from time to time by the Board of
Directors of the Company  provided that Section II, "Grant of Options" shall not
be  amended  more than once every six  months  other  than to  comport  with the
Internal  Revenue Code of 1986, as amended,  or the Employee  Retirement  Income
Security Act of 1974, as amended, or the rules thereunder. Except as provided in
Section IV hereof,  rights and  obligations  under any option  granted before an
amendment shall not be altered or impaired by such amendment without the written
consent of the optionee.  If the Directors'  Option Plan becomes qualified under
17 CFR ss. 16(b)-3 of the rules and regulations  promulgated  under the Exchange
Act and an amendment would require shareholder  approval under such rule 16(b)-3
to retain the Plan's  qualification,  then such amendment  shall be presented to
shareholders for  ratification,  provided,  however,  that the failure to obtain
shareholder  ratification  shall  not  affect  the  validity  of this Plan as so
amended and the options granted thereunder.

VIII. Applicable Law

     The Plan will be  administered  in accordance with the laws of the State of
Delaware.


<PAGE>

















                                  EXHIBIT 10.3
                             LIBERTY BANCORP, INC.
                        1991 INCENTIVE STOCK OPTION PLAN

















<PAGE>


                             AMENDMENT NO. 1 TO THE
                             LIBERTY BANCORP, INC.
                              AMENDED AND RESTATED
                        1991 INCENTIVE STOCK OPTION PLAN

     WHEREAS, the Board of Directors ("Board") of Liberty Bancorp,  Inc. desires
to amend the Liberty  Bancorp,  Inc.  Amended and Restated 1991 Incentive  Stock
Option Plan (the "Plan") to conform to the new rules  adopted by the  Securities
and  Exchange  Commission  (SEC) as they relate to Section 16 of the  Securities
Exchange Act of 1934;

     WHEREAS, Section 16 of the Plan permits the Plan to be amended from time to
time subject to the Securities and Exchange Commission Rule 16b-3;

     WHEREAS,   Rule  16b-3  no  longer  requires   shareholder  approval  as  a
prerequisite to any  modification or amendment that affects the grant,  award or
other acquisition from an issuer;

     NOW,  THEREFORE,  BE IT  RESOLVED,  that the Plan  shall be, and hereby is,
amended effective as of September 1, 1996, in accordance with the following:

          2.   Definitions is amended as follows:

          The definition of "Committee" is amended and reads in full as follows:

               "Committee"  means a committee of the Board  consisting of either
               (i) at least two  Non-Employee  Directors of the Holding Company,
               or (ii) the entire Board of the Holding Company.

          A new definition of "Director" is added and reads as follows:

               "Director" means a member of the Board.

          A new definition of "Key Employee" is added and reads as follows:

               "Key Employee" means any person who is currently  employed by the
               Holding Company or an Affiliate who is chosen by the Committee to
               participate in the Plan.

          The  definition  of "Fair Market  Value" is amended by the addition of
          the following:

               In the event Fair Market Value cannot be determined in the manner
               described  above,  then Fair Market Value shall be  determined by
               the Committee. The

<PAGE>

               Committee  is  authorized,  but is not  required,  to  obtain  an
               independent  appraisal to determined the Fair Market Value of the
               Common Stock.

          A new  definition  of  "Non-Employee  Director"  is added and reads as
          follows:

               "Non-Employee  Director"  means,  for  purposes  of the  Plan,  a
               Director who (a) is not employed by the Holding Company; (b) does
               not receive  compensation  directly or indirectly as a consultant
               (or in any  other  capacity  than  as a  Director)  greater  than
               $60,000; (c) does not have an interest in a transaction requiring
               disclosure  under Item  404(a) of  Regulation  S-K; or (d) is not
               engaged in a business  relationship for which disclosure would be
               required pursuant to Item 404(b) of Regulation S-K.

          A new definition of "Outside  Director" is added to the Plan and reads
          as follows:

               "Outside  Director"  means a  Director  who is not an  officer or
               employee of the Holding Company.

          3. Administration is amended by the addition of the following:

               All transactions  involving a grant,  award or other  acquisition
               from the Holding Company shall:

                    (a) be approved by the  Holding  Company's  full Board or by
                    the Committee;

                    (b) be approved,  or ratified, in compliance with Section 14
                    of the Exchange Act, by either:  the affirmative vote of the
                    holders  of  a  majority  of  the  securities   present,  or
                    represented  and  entitled to vote at a meeting duly held in
                    accordance  with the laws of the state in which the  Holding
                    Company  is  incorporated;  or the  written  consent  of the
                    holders  of a  majority  of the  securities  of  the  issuer
                    entitled to vote provided that such  ratification  occurs no
                    later  than  the  date  of  the  next   annual   meeting  of
                    shareholders; or

                    (c) be held by the  Participant  for a period of six  months
                    following the date of such acquisition.

          A new Paragraph 7.1(e) is added to the Plan and reads as follows:

               (e)  Transferability.  In the discretion of the Board, all or any
               Non-statutory Stock Options granted hereunder may be transferable
               by the Participant,  provided,  however, that the Board may limit
               the  transferability  of such  Option or Options to a  designated
               class or classes of persons.
<PAGE>

8.1(a) Price is amended to read in full as follows:

          Subject  to Section 14 of the Plan and  Section  422 of the Code,  the
     purchase price per share of Common stock  deliverable  upon the exercise of
     each Incentive  Stock Option shall be not less than 100% of the Fair Market
     Value of the Holding Company's Common stock on the Date of Grant,  However,
     if a Key Employee owns stock possessing more than 10% of the total combined
     voting  power of all  classes of Common  Stock of the  Holding  Company (or
     under Section 424(d) of the Code is deemed to own stock  representing  more
     than 10% of the total combined  voting power of all classes of stock of the
     Holding  Company  by  reason of the  ownership  of such  classes  of stock,
     directly or indirectly,  by or for any brother, sister, spouse, ancestor or
     lineal  descendent  of such  Key  Employee,  or by or for any  corporation,
     partnership,  estate or trust of which such key Employee is a  shareholder,
     partner  or  beneficiary),  the  purchase  price per share of Common  Stock
     deliverable  upon the exercise of each Incentive  Stock Option shall not be
     less than 110% of the Fair  Market  Value of the Holding  Company's  Common
     Stock on the Date of Grant.  Shares may be  purchased  only upon payment of
     the full  purchase  price.  Payment of the purchase  price may be made,  in
     whole or in part,  through the  surrender  of shares of the Common Stock of
     the Holding  Company at the Fair Market Value of such shares on the date of
     surrender determined in the manner described in Section 2(i).

8.1(c) Term of Options is amended by amending  the second  paragraph  to read in
full as follows:

          The Committee  shall  determine the date on which each Incentive Stock
     Option shall  become  exercisable  and may provide that an Incentive  Stock
     Option shall become exercisable in installments. The shares comprising each
     installment  may be  purchased  in whole or in part at any time  during the
     term of such option after such installment  becomes  exercisable,  provided
     that the amount able to be first  exercised  in a given year is  consistent
     with the  terms of  Section  422 of the Code.  To the  extent  required  by
     Section 422 of the Code, the aggregate Fair Market Value (determined at the
     time the option is granted) of the Common Stock for which  Incentive  Stock
     Options  are  exercisable  for the first time by a  Participant  during any
     calendar year (under all plans of the Holding Company and its  Affiliate's)
     shall not exceed  $100,000.  The  Committee  may,  in its sole  discretion,
     accelerate the time at which any Incentive Stock Option may be exercised in
     whole or in part,  provided that it is consistent with the terms of Section
     422 of the Code.  Notwithstanding  the  above,  in the event of a Change in
     Control of the Holding  Company,  all Incentive  Stock Options shall become
     immediately  exercisable,  unless  the  Fair  Market  Value  of the  amount
     exercisable  as a result  of a Change  in  Control  shall  exceed  $100,000
     (determined as of the Date of Grant).  In such event, the first $100,000 of
     Incentive  stock  Options  (determined  as of the Date of  Grant)  shall be
     exercisable as Incentive  Stock Options and any excess shall be exercisable
     as Non-statutory Stock Options.


<PAGE>

8.1(e) Compliance with Code is amended by the addition of the following:

          If an Option  granted  hereunder  fails for whatever  reason to comply
     with the  provisions of Section 422 of the Code, and such failure is not or
     cannot be cured, such Option shall be a Non-statutory Stock Option.

9.1(b)  Payment is amended by the  addition of the  following  to the end of the
paragraph:

          In the  event of a Change  in  Control  in  which  pooling  accounting
     treatment is a condition  to the  transaction,  the Limited  Right shall be
     exercisable  solely for shares of stock of the Holding  Company,  or in the
     event of a merger transaction,  for shares of the acquiring  corporation or
     its  parent,  as  applicable.  The number of shares to be  received  on the
     exercise of such Limited  Right shall be  determined by dividing the amount
     of cash that would have been  available  under the first  sentence above by
     the Fair Market Value at the time of exercise of the shares  underlying the
     Option subject to the Limited Right.

     11. RIGHTS OF A SHAREHOLDER:  NONTRANSFERABILITY  is amended by the removal
of the second paragraph and is retitled RIGHTS OF A SHAREHOLDER.

     14. DILUTION AND OTHER ADJUSTMENTS is amended by the addition to the end of
the last paragraph the following:

          With respect to Incentive Stock Options,  no such adjustment  shall be
     made if it would be deemed a "modification"  of the Award under Section 424
     of the Code.

          16.  AMENDMENT  OF THE PLAN is amended  and reads in its  entirety  as
     follows:

          The Board may at any time, and from time to time,  modify or amend the
     Plan in any respect,  or modify or amend an Award received by  Participant;
     provided, however, that no such termination,  modification or amendment may
     affect  the  rights  of  a  Participant,  without  his  consent,  under  an
     outstanding  Award.  Any  amendment  or  modification  of  the  Plan  or an
     outstanding  Award under the Plan shall be approved by the Committee or the
     full Board of the Holding Company.
<PAGE>

                             LIBERTY BANCORP, INC.
                              AMENDED AND RESTATED
                        1991 INCENTIVE STOCK OPTION PLAN



1.PURPOSE.

     The purpose of the Liberty  Bancorp,  Inc.  (the  "Holding  Company")  1991
Incentive Stock Option Plan as Amended and Restated,  (the "Plan") is to advance
the interests of the Holding Company and its shareholders by providing those key
employees of the Holding Company and its Affiliates,  including  Liberty Federal
Savings  Bank (the  "Bank"),  upon whose  judgment,  initiative  and efforts the
successful  conduct of the  business of the Holding  Company and its  Affiliates
largely  depends,  with additional  incentive to perform in a superior manner as
well as to attract people of experience and ability.

2. DEFINITIONS.

     (a) "Affiliate" means (i) a member of a controlled group of corporations of
which  the  Holding  Company  is a  member  or (ii) an  unincorporated  trade or
business which is under common control with the Holding Company as determined in
accordance with Section 414(c) of the Internal Revenue Code of 1986, as amended,
(the "Code") and the  regulations  issued  thereunder.  For purposes  hereof,  a
"controlled group of corporations" shall mean a controlled group of corporations
as defined in Section 1563(a) of the Code  determined  without regard to Section
1563(a)(4) and (e)(3)(C).

     (b) "Award" means a grant of Non-statutory  Stock Options,  Incentive Stock
Options, and/or Limited Rights under the provisions of this Plan.

     (c) "Board of  Directors"  or "Board"  means the board of  directors of the
Holding Company.

     (d) "Change in Control" of the Bank or Holding  Company shall mean an event
of a nature that;  (i) would be required to be reported in response to Item I of
the  current  report on Form 8-K, as in effect on the date  hereof,  pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934 (the "Exchange Act");
or (ii) results in a Change in Control of the Bank or the Holding Company within
the meaning of the Home Owners' Loan Act of 1933, as amended,  and the Rules and
Regulations  promulgated  by the Office of Thrift  Supervision  ("OTS")  (or its
predecessor agency), as in effect on the date hereof (provided, that in applying
the definition of change in control as set forth under the rules and regulations
of the OTS, the Board shall  substitute  its  judgment for that of the OTS);  or
(iii)  without  limitation  such a Change  in  Control  shall be  deemed to have
occurred at such time as (A) any "person" (as the term is used in Sections 13(d)
and 14(d) of the Exchange Act) is or becomes the "beneficial  owner" (as defined
in Rule 13d-3 under the Exchange Act), directly or indirectly,  of securities of
the Bank or the Holding  Company  representing  20% or more of the Bank's or the
Holding Company's  outstanding  securities except for any securities of the Bank
purchased by the Holding  Company in connection  with the conversion of the Bank
to the stock form and any  securities  purchased by any tax  qualified
<PAGE>


employee  benefit plan of the Bank; or (B)  individuals who constitute the Board
on the date hereof (the "Incumbent Board") cease for any reason to constitute at
least  a  majority  thereof,  provided  that  any  person  becoming  a  director
subsequent to the date hereof whose  election was approved by a vote of at least
three-quarters  of the  directors  comprising  the  Incumbent  Board,  or  whose
nomination for election by the Holding  Company's  stockholders  was approved by
the same Nominating  Committee  serving under an Incumbent Board,  shall be, for
purposes  of this  clause  (B),  considered  as  though  he were a member of the
Incumbent Board; or (C) a plan of reorganization, merger, consolidation, sale of
all or  substantially  all the  assets  of the Bank or the  Holding  Company  or
similar  transaction  occurs in which  the Bank or  Holding  Company  is not the
resulting  entity; or (D) a solicitation of shareholders of the Holding Company,
by someone  other than the current  management of the Holding  Company,  seeking
stockholder approval of a plan of reorganization, merger or consolidation of the
Holding Company or Bank or similar  transaction with one or more corporations as
a result of which the outstanding shares of the class of securities then subject
to the plan or transaction  are exchanged for or converted into cash or property
or  securities  not  issued  by  the  Bank  or  the  Holding  Company  shall  be
distributed;  or (E) a  tender  offer  is made  for  20% or  more of the  voting
securities or the Bank of the Holding Company.

     (e) "Committee" means a committee consisting of non-employee members of the
Board of Directors,  all of whom are "disinterested  directors" as such terms is
defined under Rule 16b-3 under the Securities  Exchange Act of 1934, as amended,
(the "Exchange Act") as promulgated by the Securities and Exchange Commission.

     (f)  "Common  Stock"  means the Common  Stock of the Holding  Company,  par
value, $.01 per share or any stock exchanged for shares of Common Stock pursuant
to Section 14 hereof.

     (g) "Date of Grant"  means the actual  date on which an Award is granted by
the Committee.

     (h)  "Disability"  means the  permanent  and total  inability  by reason of
mental or physical  infirmity,  or both,  of a  Participant  to perform the work
customarily assigned to him. Additionally, a medical doctor selected or approved
by the Board of  Directors  must  advise  the  Committee  that it is either  not
possible to determine  when such  Disability  will  terminate or that it appears
probable  that such  Disability  will be permanent  during the remainder of said
Participant's lifetime.

     (i) "Fair Market  Value"  means,  when used in  connection  with the Common
Stock on a  certain  date,  the  average  of the high and low bid  prices of the
Common  Stock as reported by the  National  Association  of  Securities  Dealers
Automated  Quotation  System  (as  published  by the  Wall  Street  Journal,  if
published)  on such date or if the Common Stock was not traded on such date,  on
the next  preceding day on which the Common Stock was traded thereon or the last
previous date on which a sale is reported.  For purposes of the grant of options
in the  conversion of the Bank,  Fair Market Value shall mean the initial public
offering price of the Common Stock.

     (j) "Incentive  Stock Option" means an Option granted by the Committee to a
Participant,  which Option is designated by the Committee as an Incentive  Stock
Option pursuant to Section 8.

<PAGE>

     (k) "Limited Right" means the right to receive an amount of cash based upon
the terms set forth in Section 9.

     (1)  "Non-statutory  Stock Option" means an Option granted by the Committee
to a Participant pursuant to Section 7, which is not designated by the Committee
as an Incentive  Stock Option or which is  redesignated  by the Committee  under
Section 8 as a Non-Statutory Stock Option.

     (m)  "Option"  means the right to buy a fixed  amount of Common  Stock at a
specified price called the exercise or purchase price within a limited period of
time designated as the term of the option as granted under Section 7 or 8 of the
Plan.

     (n) "Participant" means any person who holds an outstanding Award under the
terms of the Plan.

     (o)  "Retirement"  with  respect  to a  Participant  means  termination  of
employment which constitutes  retirement under any tax qualified plan maintained
by the Bank.  However,  "Retirement"  will not be deemed  to have  occurred  for
purposes  of this  Plan if a  Participant  continues  to serve  on the  Board of
Directors  of the  Holding  Company  or the  Bank  even if such  Participant  is
receiving  retirement  benefits under any retirement plan of the Holding Company
or its Affiliates.

     (p) "Termination  for Cause" shall mean  termination  because of a material
loss  to  the  Holding  Company  or  one  of  its  subsidiaries  caused  by  the
Participant's intentional failure to perform stated duties, personal dishonesty,
willful violation of any law, rule,  regulation,  (other than traffic violations
or similar  offenses) or final cease and desist order. No act, or the failure to
act, on  Participant's  part shall be "willful"  unless  done,  or omitted to be
done,  not in good  faith  and  without  reasonable  belief  that the  action or
omission was in the best interest of the Holding Company or its subsidiaries.

3. ADMINISTRATION.

     The  Plan  shall  be  administered  by  the  Committee.  The  Committee  is
authorized,  subject to the  provisions of the Plan, to establish such rules and
regulations as it deems necessary for the proper  administration of the Plan and
to make whatever  determinations and interpretations in connection with the Plan
it deems necessary or advisable.  All determinations and interpretations made by
the Committee  shall be binding and conclusive on all  Participants  in the Plan
and on their legal representatives and beneficiaries.

4. TYPES OF AWARDS.

     The following Awards may be granted under the Plan:

          (a) Non-statutory Stock Options;
          (b) Incentive Stock Options; and
<PAGE>


          (c) Limited Rights

     as described below in paragraphs 7 through 9 of the Plan.

5. STOCK SUBJECT TO THE PLAN.

     Subject to  adjustment  as provided  in Section  14, the maximum  number of
shares reserved hereby for purchase  pursuant to the exercise of options granted
under the Plan shall not exceed  285,313  shares of Common  Stock of the Holding
Company,  par value $.01 per share,  These  shares of Common Stock may be either
authorized but unissued shares or shares previously issued and reacquired by the
Holding Company. To the extent that options and Limited Rights are granted under
the Plan, the shares  underlying  such Awards will be unavailable  for any other
use  including  future  grants  under the Plan except  that,  to the extent that
options  together  with  any  related  Limited  Rights  granted  under  the Plan
terminate, expire or are cancelled without having been exercised (in the case of
Limited  Rights,  exercised  for cash),  new Awards may be made with  respect to
these shares.  No Participant  under the Plan may receive Awards with respect to
shares of Common Stock that in the aggregate, exceed _________ shares underlying
Options in any calendar year.

6. ELIGIBILITY.

     Officers and other employees of the Holding Company or its Affiliates shall
be  eligible  to  receive  Awards  under  the Plan.  Directors  who are not also
employees  or  officers of the Holding  Company or its  Affiliates  shall not be
eligible to receive Awards under the Plan,  however,  a director who is a former
officer or other employee may continue to hold unexercised  Awards granted while
such person was eligible as provided in Section 7(d) hereof.

7. NON-STATUTORY STOCK OPTIONS.

     7.1  Grant of Non-statutory Stock Options.

          The  Committee  may,  from  time to time,  grant  Non-statutory  Stock
     Options to eligible  employees  and, upon such terms and  conditions as the
     Committee may determine,  grant  Non-statutory  options in exchange for and
     upon surrender of previously granted Awards under this Plan.  Non-statutory
     Stock Options  granted  under this Plan are subject to the following  terms
     and conditions:

          (a) Price.  The purchase  price per share of Common Stock  deliverable
     upon the exercise of each Non-statutory Stock Option shall be determined by
     the Committee on the date the option is granted. In general,  such purchase
     price shall not be less than 100% of the Fair  Market  Value of the Holding
     Company's  Common Stock on the Date of Grant.  The purchase price per share
     of Common Stock deliverable upon the exercise of each  Non-statutory  Stock
     Option  granted in exchange for and upon  surrender of  previously  granted
     Awards  shall be not less than 85% of the Fair Market  Value of the Holding
     Company's  Common  Stock on the  Date of  Grant,  but in no  event  may the
     purchase price of any Non-statutory Stock Option be less than the par value
     of the
<PAGE>


     Common  Stock.  Shares  may be  purchased  only  upon full  payment  of the
     purchase  price.  Payment of the purchase price may be made, in whole or in
     part,  through the  surrender  of shares of the Common Stock of the Holding
     Company at the Fair Market  Value of such  shares on the date of  surrender
     determined in the manner described in Section 2(i).

          (b) Terms of Options.  The term during which each Non-statutory  Stock
     Option may be exercised  shall be  determined by the  Committee,  but in no
     event shall a Non-statutory Stock Option be exercisable in whole or in part
     more than 10 years from the Date of Grant The Committee shall determine the
     date on which each Non-statutory  Stock Option shall become exercisable and
     may provide that a Non-statutory  Stock Option shall become  exercisable in
     installments.  The shares  comprising each  installment may be purchased in
     whole or in part at any time  during  the term of such  option  after  such
     installment becomes exercisable. The Committee may, in its sole discretion,
     accelerate  the  time  at  which  any  Non-statutory  Stock  Option  may be
     exercised in whole or in part. Notwithstanding the above, in the event of a
     Change in Control of the Holding Company,  all Non-statutory  Stock Options
     shall become immediately exercisable.

          (c)  Termination of  Employment.  Unless  otherwise  determined by the
     Committee,  upon the termination of a Participant's  service for any reason
     other than Disability,  Retirement, Change in Control, death or Termination
     for  Cause,  the  Participant's   Non-statutory   Stock  Options  shall  be
     exercisable only as to those shares which were  immediately  exercisable by
     the  Participant at the date of termination  and only for a period of three
     months  following  termination.  Notwithstanding  any  provision  set forth
     herein nor contained in any  Agreement  relating to the award of an Option,
     in the event of Termination for Cause,  all rights under the  Participant's
     Non-statutory Stock Options shall expire upon termination.

          Unless otherwise  determined by the Committee,  in the event of death,
     termination  of service as a result of  Disability,  Change in Control,  or
     Retirement of any Participant,  all Non-statutory Stock Options held by the
     Participant,  whether or not exercisable at such time, shall be exercisable
     immediately   by  the   Participant   or  the  legal   representatives   or
     beneficiaries  of the Participant,  and remain  exercisable for one year or
     such longer period as determined by the Committee following the date of the
     Participant's death or termination of employment due to Disability,  Change
     in Control, or Retirement provided that in no event shall the period extend
     beyond the expiration of the Non-statutory Stock Option term.

          (d)  Exception  for  Retirement.   Notwithstanding  the  general  rule
     contained in Section  7.1(c) above,  all options held by a Recipient  whose
     employment  with the Bank or an Affiliate  terminates due to Retirement and
     who,  as of the  Recipient's  last  day of  employment  with  the  Bank  or
     Affiliate, is a director of the Bank or an Affiliate shall not be forfeited
     and shall continue to be earned as determined by the  Committee;  provided,
     however, that any unearned options shall be forfeited upon such Recipient's
     termination of services as a director of the Bank or any Affiliate. Options
     earned  pursuant  to this  subsection  shall be  otherwise  subject  to the
     provisions of this Plan.

<PAGE>

8. INCENTIVE STOCK OPTIONS.

     8.1 Grant of Incentive Stock Options.

     The Committee  may,  from time to time,  grant  Incentive  Stock Options to
eligible  employees.  Incentive Stock Options granted pursuant to the Plan shall
be subject to the following terms and conditions:

     (a) Price.  The purchase price per share of Common Stock  deliverable  upon
the exercise of each  Incentive  Stock Option shall be not less than 100% of the
Fair Market  Value of the Holding  Company's  Common Stock on the Date of Grant.
However,  if a  Participant  owns  stock  possessing  more than 10% of the total
combined voting power of all classes of Common Stock of the Holding Company, the
purchase price per share of Common Stock  deliverable  upon the exercise of each
Incentive  Stock  Option shall not be less than 110% of the Fair Market Value of
the Holding Company's Common Stock on the Date of Grant. Shares may be purchased
only upon payment of the full purchase price.  Payment of the purchase price may
be made,  in whole or in part,  through  the  surrender  of shares of the Common
Stock of the Holding Company at the Fair Market Value of such shares on the date
of surrender determined in the manner described in Section 2(i).

     (b)  Amounts of  Options.  Incentive  Stock  Options  may be granted to any
eligible employee in such amounts as determined by the Committee;  provided that
the amount  granted is consistent  with the terms of Section 422 of the Internal
Revenue Code. In the case of an option intended to qualify as an Incentive Stock
Option, the aggregate Fair Market Value (determined as of the time the option is
granted)  of the Common  Stock with  respect to which  Incentive  Stock  Options
granted  are  exercisable  for the  first  time by the  Participant  during  any
calendar year (under all plans of the Participant's employer corporation and its
parent and subsidiary corporations) shall not exceed $100,000. The provisions of
this Section  8.1(b) shall be construed and applied in  accordance  with Section
422(d) of the Code and the regulations,  if any, promulgated thereunder.  To the
extent an award under this Section 8.1 exceeds this $100,000 limit,  the portion
of the award in  excess of such  limit  shall be  deemed a  Non-statutory  Stock
Option.  The Committee shall have  discretion to redesignate  options granted as
Incentive Stock Options as Non-Statutory Stock Options. Such Non-Statutory Stock
Options shall be subject to Section 7 of the Plan.

     (c) Terms of Options. The term during which each Incentive Stock Option may
be exercised  shall be  determined  by the  Committee,  but in no event shall an
Incentive  Stock  Option be  exercisable  in whole or in part more than 10 years
from the Date of Grant. If at the time an Incentive Stock Option is granted to a
Participant, the Participant owns Common Stock representing more than 10% of the
total  combined  voting  securities  of the Holding  Company (or,  under Section
424(d) of the Code, is deemed to own Common Stock  representing more than 10% of
the total combined voting power of all classes of stock of the Holding  Company,
by reason of the ownership of such classes of stock, directly or indirectly,  by
or for any  brother,  sister,  spouse,  ancestor  or lineal  descendent  of such
Participant, or by or for any corporation, partnership, estate or trust of which
such Participant is a shareholder,  partner or beneficiary), the Incentive Stock
Option granted to such Participant shall not be exercisable after the expiration
of five years from
<PAGE>

the Date of  Grant.  No  Incentive  Stock  Option  granted  under  this  Plan is
transferable  except  by will or the laws of  descent  and  distribution  and is
exercisable in his lifetime only by the Participant to whom it is granted.

     The Committee shall determine the date on which each Incentive Stock Option
shall become  exercisable  and may provide that an Incentive  Stock Option shall
become  exercisable in installments.  The shares comprising each installment may
be  purchased  in whole or in part at any time  during  the term of such  option
after such installment becomes exercisable,  provided that the amount able to be
first  exercised in a given year is consistent  with the terms of Section 422 of
the Code.  The Committee  may, in its sole  discretion,  accelerate  the time at
which any Incentive Stock Option may be exercised in whole or in part,  provided
that it is consistent with the terms of Section 422 of the Code. Notwithstanding
the  above,  in the event of a Change in  Control of the  Holding  Company,  all
Incentive Stock Options shall become immediately exercisable.

     (d)  Termination  of  Employment.   Unless  otherwise   determined  by  the
Committee,  upon the termination of a Participant's service for any reason other
than Disability,  Retirement, Change in Control, death or Termination for Cause,
the Participant's  Incentive Stock Options shall be exercisable only as to those
shares which were  immediately  exercisable  by the  Participant  at the date of
termination  and only  for a  period  of  three  months  following  termination.
Notwithstanding  any  provisions set forth herein nor contained in any Agreement
relating  to an award of an Option,  in the event of  Termination  for Cause all
rights  under the  Participant's  Incentive  Stock  Options  shall  expire  upon
termination.

     Unless  otherwise  determined  by the  Committee,  in the event of death or
termination  of  service  as a result  of  Disability  of any  Participant,  all
Incentive Stock Options held by such Participant,  whether or not exercisable at
such time,  shall be exercisable by the Participant or the  Participant's  legal
representatives  or beneficiaries of the Participant for one year or such longer
period as determined by the  Committee  following the date of the  Participant's
death or termination of employment as a result of Disability.  Upon  termination
of the Participant's service as a result of Retirement,  or a Change in Control,
all Incentive Stock Options held by such Participant, whether or not exercisable
at such  time,  shall be  exercisable  for a period  of one year or such  longer
period  as  determined  by the  Committee  following  the date of  Participant's
termination  of  employment,  provided  however,  that such option  shall not be
eligible for treatment as an Incentive  Stock Option in the event such option is
exercised  more  than  three  months  following  the  date of the  Participant's
termination  of service as a result of Retirement or a Change in Control.  In no
event shall the exercise  period extend  beyond the  expiration of the Incentive
Stock Option term.
<PAGE>

     (e) Compliance  with Code. The options  granted under this Section 8 of the
Plan are intended to qualify as incentive  stock  options  within the meaning of
Section  422 of the Code,  but the Holding  Company  makes no warranty as to the
qualification  of any option as an incentive  stock option within the meaning of
Section 422 of the Code.
<PAGE>


9. LIMITED RIGHTS.

     9.1 Grant of Limited Rights.

     Simultaneously  with the grant of any  option,  the  Committee  may grant a
Limited Right with respect to all or some of the shares  covered by such option.
Limited  Rights  granted under this Plan are subject to the following  terms and
conditions:

     (a) Terms of Rights.  In no event shall a Limited Right be  exercisable  in
whole or in part before the  expiration  of six months from the Date of Grant of
the  Limited  Right.  A Limited  Right may be  exercised  only in the event of a
Change in Control of the Holding Company.

     The  Limited  Right may be  exercised  only when the  underlying  option is
eligible to be exercised,  and only when the Fair Market Value of the underlying
shares  on the day of  exercise  is  greater  than  the  exercise  price  of the
underlying option.

     Upon exercise of a Limited Right,  the underlying  option shall cease to be
exercisable.  Upon exercise or  termination  of an option,  any related  Limited
Rights shall  terminate.  The Limited Rights may be for no more than 100% of the
difference  between the  purchase  price and the Fair Market Value of the Common
Stock subject to the underlying  option.  The Limited Right is transferable only
when the underlying option is transferable and under the same conditions.

     (b) Payment.  Upon exercise of a Limited  Right,  the holder shall promptly
receive  from the  Holding  Company  an amount of cash  equal to the  difference
between the purchase price of the underlying option and the Fair Market Value of
the Common Stock subject to the underlying  option on the date the Limited Right
is  exercised,  multiplied  by the number of shares  with  respect to which such
Limited Right is being exercised.

     (c) Termination of Employment.  After the occurrence of a Change in Control
of the Holding Company,  upon the termination of a Participant's service for any
reason  other  than  Termination  for  Cause,  any  Limited  Rights  held by the
Participant  shall  then be  exercisable  for a  period  of one  year  following
termination.  In the event of Termination for Cause,  all Limited Rights held by
the Participant  shall expire  immediately.  After the occurrence of a Change in
Control of the Holding Company, upon termination of the Participant's employment
for reason of death,  Retirement or Disability,  all Limited Rights held by such
Participant shall be exercisable by the Participant or the  Participant's  legal
representative(s)  or  beneficiaries  for a period  of one year from the date of
such  termination.  In no event shall the period extend beyond the expiration of
the term of the underlying option.

10. SURRENDER OPTION.

     In the event of a  Participant's  termination  of employment as a result of
death,  Disability or Retirement,  the  Participant or the  Participant's  legal
representative(s)  or beneficiaries,  may, in a form acceptable to the Committee
make application to surrender all or part of options held by such Participant in
exchange for a cash  payment from the Holding  Company in an amount equal
<PAGE>

to the difference  between the Fair Market Value of the Common Stock on the date
of  termination  of  employment  and the purchase  price per share of the option
surrendered.  Whether the Committee  accepts such  application  or determines to
make payment,  in whole or part, is within its absolute and sole discretion,  it
being  expressly  understood  that the  Committee is under no  obligation to any
Participant  whatsoever to make such  payments.  In the event that the Committee
accepts such  application  and the Holding  Company  determines to make payment,
such payment shall be in lieu of the exercise of the underlying  option and such
option shall cease to be exercisable.

11. RIGHTS OF A SHAREHOLDER: NONTRANSFERABILITY.

     No Participant  shall have any rights as a shareholder  with respect to any
shares covered by a Non-statutory  and/or  Incentive Stock Option until the date
of issuance of a stock  certificate for such shares.  Nothing in this Plan or in
any Award  granted  confers on any person any right to continue in the employ of
the Holding Company or its Affiliates or to continue to perform services for the
Holding Company or its Affiliates or interferes in any way with the right of the
Holding  Company or its Affiliates to terminate a  Participant's  services as an
officer or other employee at any time.

     No Award under the Plan shall be transferable by the Participant other than
by will or the laws of descent and distribution and may only be exercised during
his  lifetime  by  the  Participant,   or  by  a  legal  representative  of  the
Participant.

12. AGREEMENT WITH GRANTEES.

     Each Award of Options, and/or Limited Rights will be evidenced by a written
agreement  executed by the Participant and the Holding Company or its Affiliates
which  describes the conditions  for receiving the Awards  including the date of
Award, the purchase price if any,  applicable  periods,  and any other terms and
conditions as may be required by the Board of Directors or applicable securities
law.

13. DESIGNATION OF BENEFICIARY.

     A Participant may, with the consent of the Committee, designate a person or
persons to receive,  in the event of death,  any Award to which the  Participant
would then be entitled. Such designation will be made upon forms supplied by and
delivered to the Holding Company and may be revoked in writing. If a Participant
fails effectively to designate a beneficiary, then the Participant's estate will
be deemed to be the beneficiary.

14. DILUTION AND OTHER ADJUSTMENTS.

     In the event of any change in the outstanding shares of Common Stock of the
Holding  Company  by reason of any stock  dividend  or split,  recapitalization,
merger,  consolidation,  spin-off,  reorganization,  combination  or exchange of
shares, or other similar corporate change, or other increase or decrease in such
shares without receipt or payment of consideration  by the Holding
<PAGE>

Company,  the Committee will make such adjustments to previously granted Awards,
to prevent dilution or enlargement of the rights of the  Participant,  including
any or all of the following:

     (a)  adjustments  in the aggregate  number or kind of shares of stock which
          may underlie future Awards under the Plan;

     (b)  adjustments  in the  aggregate  number  or kind  of  shares  of  stock
          underlying Awards already made under the Plan;

     (c)  adjustments  in the purchase  price of  outstanding  Incentive  and/or
          Non-statutory  Stock Options,  or any Limited Rights  attached to such
          options.

     No such adjustments may,  however,  materially change the value of benefits
available to a Participant under a previously granted Award.

15. TAX WITHHOLDING.

     There shall be deducted from each  distribution of cash and/or Common Stock
under the Plan the amount required by any governmental  authority to be withheld
for tax purposes.  If this Plan is qualified under 17 C.F.R.  ss.240.16b-3 under
the Exchange Act ("Rule  16b-3"),  then any  withholding  shall comply with Rule
16b-3.

16. AMENDMENT OF THE PLAN.

     The Board of Directors  may at any time,  and from time to time,  modify or
amend the Plan in any respect;  provided however,  that Section 7.1, 8.1 and 9.1
governing grants shall not be amended more than once every six months other than
to comport with the Internal  Revenue  Code or the  Employee  Retirement  Income
Security Act of 1974, as amended, if applicable and provided further that, if it
has been  determined  by the Board of  Directors to continue to qualify the Plan
under  Rule  16b-3,   shareholder  approval  shall  be  required  for  any  such
modification or amendment which:

     (a)  materially  increases  the maximum  number of shares -for which Awards
          may be granted under the Plan (subject,  however, to the provisions of
          Section 14 hereof);

     (b)  reduces the exercise  price at which  Awards may be granted  (subject,
          however, to the provisions of Section 14 hereof);

     (c)  extends the period  during  which  Awards may be granted or  exercised
          beyond the terms originally prescribed; or

     (d)  changes the persons subject to Section 16 of the Exchange Act eligible
          to participate in the Plan.

<PAGE>

     Failure to ratify or approve amendments or modifications to subsections (a)
through (d) of this Section by  shareholders  shall be effective  only as to the
specific   amendment  or  modification   requiring  such   ratification.   Other
provisions, sections, and subsections of this Plan will remain in full force and
effect

     No such  termination,  modification or amendment may affect the rights of a
Participant under an outstanding Award.

17. EFFECTIVE DATE OF PLAN.

     The Plan shall become  effective upon the consummation of the conversion of
Liberty  Federal Savings Bank from the mutual to capital stock form of ownership
(the  "Effective  Date") on December  23,  1991.  The Plan shall be presented to
shareholders for ratification for purposes of: (i) obtaining favorable treatment
under  Section  16(b) of the  Securities  Exchange Act of 1934;  (ii)  obtaining
preferential  tax treatment for Incentive Stock Options;  and (iii)  maintaining
listing on the NASDAQ National Market System.  The failure to obtain shareholder
ratification  will  not  effect  the  validity  of  the  Plan  and  the  options
thereunder,  provided, however, that if the Plan is not ratified, the Plan shall
remain in full force and effect,  and any Incentive  Stock Options granted under
the Plan shall be deemed to be Non-statutory Stock Options.

18. TERMINATION OF THE PLAN.

     The right to grant Awards under the Plan will terminate upon the earlier of
ten (10) years after the  Effective  Date of the Plan or the  issuance of Common
Stock or the exercise of options,  surrender  rights or related  Limited  Rights
equivalent to the maximum number of shares  reserved under the Plan as set forth
in Section 5. The Board of Directors  has the right to suspend or terminate  the
Plan at any time,  provided  that no such action will,  without the consent of a
Participant, adversely affect his rights under a previously granted Award.

19. APPLICABLE LAW.

     The Plan will be  administered  in accordance with the laws of the State of
Delaware.

20. COMPLIANCE WITH SECTION 16.

     If this Plan is qualified under Rule 16b-3, with respect to persons subject
to Section 16 of the Exchange Act,  transactions under this Plan are intended to
comply with all applicable  conditions of Rule 16b-3 or its successors under the
Exchange  Act.  To the  extent  any  provisions  of the  Plan or  action  by the
Committee  fail to so comply,  it shall be deemed  null and void,  to the extent
permitted by law and deemed advisable by the Committee.

IN WITNESS WHEREOF, the Bank has established this Plan, as amended and restated,
to be executed by its duly authorized  executive  officer and the corporate seal
to be affixed and duly attested, effective as of the 12th day of January, 1995.

<PAGE>














                                 EXHIBIT 23.2

                              CONSENT OF KPMG LLP











<PAGE>

                            [LETTERHEAD OF KPMG LLP]



                             CONSENT OF INDEPENDENT
                          CERTIFIED PUBLIC ACCOUNTANTS



The Board of Directors
Alliance Bancorp:



We consent to  incorporation  by reference in the  registration  statement  (No.
36-3811768)  on Form S-8 of  Alliance  Bancorp of our report  dated  January 27,
1999, relating to the consolidated statements of financial condition of Alliance
Bancorp and  subsidiaries  as of December  31, 1998,  and 1997,  and the related
consolidated  statements of income,  changes in stockholders'  equity,  and cash
flows for each of the years in the two-year  period ended  December 31, 1998 and
the year ended September 30, 1996, which report appears in the December 31, 1998
annual report on Form 10-K of Alliance Bancorp.



/s/ KPMG LLP



Chicago, Illinois
June 28, 1999
[{"type": "S-8", "sequence": "1", "description": "S-8 FOR ALLIANCE BANCORP, INC.", "secsgml_size_bytes": 92359}]
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Registration No. 333-             As filed with the Commission on June 28, 1999

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

--------------------------------------------------------------------------------

                                    FORM S-8

                             REGISTRATION STATEMENT

                                     UNDER

                           THE SECURITIES ACT OF 1933

--------------------------------------------------------------------------------

                                Alliance Bancorp
             (Exact Name of Registrant as Specified in its Charter)

        Delaware                                          36-3811768
(State of Incorporation)                       (IRS Employer Identification No.)

                                One Grant Square
                            Hinsdale, Illinois 60521
             (Address of Principal Executive Offices and Zip Code)

                                --------------

          Alliance Bancorp 1997 Long-Term Incentive Stock Benefit Plan
       Liberty Bancorp, Inc. 1991 Stock Option Plan for Outside Directors
             Liberty Bancorp, Inc. 1991 Incentive Stock Option Plan
                           (Full Title of the Plans)

                                   Copies to:

       Kenne P. Bristol                           John J. Gorman, Esquire
President and Chief Executive Officer      Luse Lehman Gorman Pomerenk & Schick
       Alliance Bancorp                         A Professional Corporation
       One Grant Square                      5335 Wisconsin Ave., N.W., #400
     Hinsdale, Illinois 60521                     Washington, D.C. 20015
        (630) 323-1776                                 (202) 274-2000
(Name, Address and Telephone
 Number of Agent for Service)

                                ----------------

     If any of the securities being registered on this Form are to be offered on
a delayed or continuous  basis  pursuant to Rule 415 under the Securities Act of
1933 check the following box. [X]
CALCULATION OF REGISTRATION FEE

========================---------------------------------------------------------------------=======================
Proposed Maximum       Proposed Maximum
Title of Securities to  Amount to be           Offering Price Per     Aggregate Offering     Amount of
be Registered           Registered (1)         Share                  Price                  Registration Fee
========================---------------------------------------------------------------------=======================
Common Stock,
par value $0.01
per share               391,967 shares (2)     $21.84 (3)             $8,560,559             $2,380
========================---------------------------------------------------------------------=======================
Common Stock,
par value $0.01
per share               208,033 shares (4)     $23.13(3)              $4,811,803             $1,338
========================---------------------------------------------------------------------=======================
Common Stock,
par value $0.01
per share               244,123 shares (5)     $5.37 (3)              $1,310,941             $364
========================---------------------------------------------------------------------=======================
Common Stock,
par value $0.01
per share               321,150 shares (6)     $12.29 (3)             $3,946,551             $1,097
====================================================================================================================
Total                   1,165,273 shares                              $18,629,854            $5,179
====================================================================================================================
_____________

(1)  Together with an  indeterminate  number of  additional  shares which may be
     necessary to adjust the number of shares reserved for issuance  pursuant to
     the  Alliance  Bancorp 1997  Long-Term  Incentive  Stock  Benefit Plan (the
     "Stock Benefit Plan"), the Liberty Bancorp, Inc. 1991 Stock Option Plan for
     Outside Directors (the "Directors Plan") and the Liberty Bancorp, Inc. 1991
     Incentive  Stock  Benefit  Plan (the  "Incentive  Plan") as the result of a
     stock split, stock dividend or similar adjustment of the outstanding Common
     Stock of Alliance Bancorp pursuant to 17 C.F.R. Section 230.416(a).

(2)  Represents the number of shares currently reserved for issuance pursuant to
     option  granted  pursuant to the Stock Benefit Plan.

(3)  Determined  by the  exercise  price of the  options  pursuant  to 17 C.F.R.
     Section 230.457(h)(1).

(4)  Represents the number of shares currently reserved for issuance pursuant to
     options reserved for award pursuant to the Stock Benefit Plan.

(5)  Represents the number of shares currently reserved for issuance pursuant to
     options granted pursuant to the Directors Plan.

(6)  Represents the number of shares currently reserved for issuance pursuant to
     options granted pursuant to the Incentive Plan.

                          ----------------------------
     This   Registration   Statement  shall  become  effective  upon  filing  in
accordance  with Section 8(a) of the  Securities  Act of 1933 and 17 C.F.R.  ss.
230.462.
PART I.

Items 1 and 2. Plan  Information  and Registrant  Information  and Employee Plan
Annual Information

     The documents  containing the  information  specified in Part I of Form S-8
will be sent or given to  participants  in the  Alliance  Bancorp1997  Long-Term
Incentive  Stock Benefit Plan (the "Stock Benefit Plan"),  the Liberty  Bancorp,
Inc. 1991 Stock Option Plan for Outside Directors (the "Directors Plan") and the
1991 Liberty Bancorp,  Inc.  Incentive Stock Option Plan (the "Incentive  Plan,"
and, collectively the "Plans") as specified by Rule 428(b)(1) promulgated by the
Securities and Exchange  Commission (the "Commission")  under the Securities Act
of 1933, as amended (the "Securities Act").

     Such  documents  are not being filed with the  Commission,  but  constitute
(along  with the  documents  incorporated  by  reference  into the  Registration
Statement  pursuant  to Item 3 of Part II  hereof) a  prospectus  that meets the
requirements of Section 10(a) of the Securities Act.

PART II.

Item 3. Incorporation of Documents by Reference

     The  following  documents  previously  or  concurrently  filed by  Alliance
Bancorp (the "Company") with the Commission are hereby incorporated by reference
in this Registration Statement:

(a)  the Company's Annual Report on Form 10-K for the fiscal year ended December
     31, 1998 (File No.  0-20082) filed pursuant to Rule 13a-1 of the Securities
     Exchange Act of 1934, as amended (the "Exchange Act");

(b)  all other reports  filed by the Company  pursuant to Section 12 or 15(d) of
     the  Exchange  Act since the end of the fiscal  year  covered by the Annual
     Report referred to above;

(c)  the  Company's  definitive  proxy  statement  for  its  Annual  Meeting  of
     Stockholders  held on May 28, 1997, as filed with the  Commission on May 2,
     1997;

(d)  the  description  of the common  stock,  par value $0.01 per share,  of the
     Company  contained  in the  Company's  Registration  Statement  on Form S-1
     (Registration  No.  333-46877)  filed with the Commission on March 31, 1992
     and all  amendments  or  reports  filed for the  purpose of  updating  such
     description.

     All  documents  subsequently  filed  by the  Company  with  the  Commission
pursuant to Sections 13(a),  13(c),  14, or 15(d) of the Exchange Act, after the
date  hereof,  and  prior to the  filing  of a  post-effective  amendment  which
indicates that all securities offered hereby have been sold or which deregisters
all securities then remaining unsold,  shall be deemed incorporated by reference
into this  Registration  Statement and to be a part thereof from the date of the
filing of such documents. Any statement contained in the documents incorporated,
or deemed to be incorporated,  by reference herein or therein shall be deemed to
be modified or superseded  for purposes of this  Registration  Statement and the
Prospectus to the extent that a statement  contained herein or therein or in any
other   subsequently  filed  document  which  also  is,  or  is  deemed  to  be,
incorporated  by  reference  herein  or  therein  modifies  or  supersedes  such
statement.  Any such  statement so modified or  superseded  shall not be deemed,
except as so modified or superseded,  to constitute a part of this  Registration
Statement and the prospectus.

     The  Company  shall  furnish  without  charge  to each  person  to whom the
prospectus is delivered,  on the written or oral request of such person,  a copy
of any or all of the documents incorporated by reference, other than exhibits to
such documents (unless such exhibits are specifically  incorporated by reference
to the information that is  incorporated).  Requests should be directed to Kenne
P. Bristol,  President and Chief Executive Officer,  Alliance Bancorp, One Grant
Square, Hinsdale, Illinois, 60521 telephone number (630) 323-1776.
All information appearing in this Registration Statement and the prospectus
is qualified in its entirety by the detailed  information,  including  financial
statements,  appearing  in the  documents  incorporated  herein  or  therein  by
reference.

Item 4. Description of Securities

Not applicable.

Item 5. Interests of Named Experts and Counsel

None.

Item 6. Indemnification of Directors and Officers

     Directors and officers of the Registrant are  indemnified and held harmless
against liability to the fullest extent  permissible by the general  corporation
law of Delaware as it  currently  exists or as it may be amended,  provided  any
such  amendment  provides  broader  indemnification  provisions  than  currently
exists. This  indemnification  applies to the directors who administer the Stock
Benefit Plan, the Directors Plan and the Incentive Plan.

     The  terms  of the  indemnification  are  set  forth  in  the  Registrant's
Certificate of Incorporation.  The  indemnification  applies unless the director
did not meet the  standards  of  conduct  which  make it  permissible  under the
general corporation law of Delaware for the Registrant to indemnify the director
for the  amount  claimed,  but the  burden of  proving  such  defense  is on the
Registrant.

     The Registrant is also permitted under the Certificate of Incorporation to
maintain directors' and officers' liability insurance covering its directors and
officers and has obtained a directors' and officers'  liability and  corporation
reimbursement  policy which (subject to certain limitations and deductibles) (i)
insured  officers  and  directors  of the  Registrant  against loss arising from
certain  claims made  against  them by reason of their being such  directors  or
officers;  and (ii) insures the Registrant against loss which it may be required
or permitted to pay as indemnification to its directors and officers for certain
claims.

     Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors,  officers or persons  controlling the Registrant,
the  Registrant  has been  informed that in the opinion of the  Commission  such
indemnification  is against public policy as expressed in the Securities Act and
is therefore unenforceable.

Item 7. Exemption From Registration Claimed.

Not applicable.
Item 8. List of Exhibits.
Regulation S-K                                                         Reference to Prior Filing or
Exhibit Number                      Document                           Exhibit No. Attached Hereto
3.1              Certificate of Incorporation of Alliance Bancorp            *

    3.2              Bylaws of Alliance Bancorp                                  *

     4               Specimen form of common stock certificate
                     of Alliance Bancorp                                         *

     5               Opinion of Luse Lehman Gorman Pomerenk
                     & Schick, P.C.                                           Exhibit 5

    10.1             Alliance Bancorp 1997 Long-Term Incentive
                     Stock Benefit Plan                                         **

    10.2             Liberty Bancorp, Inc. 1991 Stock Option
                     Plan for Outside Directors                              Exhibit 10.2

    10.3             Liberty Bancorp, Inc. 1991 Incentive
                     Stock Option Plan                                       Exhibit 10.3

    23.1             Consent of Luse Lehman Gorman Pomerenk
                     & Schick, P.C.                                     Contained in Exhibit 5

    23.2             Consent of KPMG LLP                               Attached as Exhibit 23.2

    24               Power of Attorney                                Contained on Signature Page
*    Filed as exhibits to the Registrant's  Registration  Statement on Form
          S-1 (File No.  333-46877)  filed with the Commission on March 31, 1992
          pursuant to Section 5 of the Securities Act of 1933 and all amendments
          thereto or reports filed for the purpose of updating such description.
          All of such previously filed documents are hereby  incorporated herein
          by reference in accordance  with Item 601 of Regulation  S-K.
     **   Filed as an exhibit to the  Registrant's  Proxy Statement  relating to
          the Registrant's  May 28, 1997 annual meeting of  stockholders,  filed
          with the Commission on May 2, 1997,  which is  incorporated  herein by
          reference.

Item 9. Undertakings

         The undersigned Registrant hereby undertakes:

1.   To file,  during  any  period in which  offers or sales are being  made,  a
     post-effective  amendment  to this  Registration  Statement  to include any
     material  information  with  respect  to  the  Registration  Statement  not
     previously disclosed in this Registration  Statement or any material change
     to such information in this Registration Statement;

2.   That, for the purpose of determining any liability under the Securities Act
     of 1933,  each such  post-effective  amendment  shall be deemed to be a new
     Registration  Statement relating to the securities offered therein, and the
     offering of such  securities at that time shall be deemed to be the initial
     bona fide offering thereof;

3.   To remove from  registration by means of a post-effective  amendment any of
     the securities  being  registered which remain unsold at the termination of
     the Stock Benefit Plan, the Directors Plan and the Incentive Plan and
4.   That, for purposes of determining any liability under the Securities Act of
     1933,  each filing of the  Registrant's  annual report  pursuant to Section
     13(a) or 15(d) of the Securities  Exchange Act of 1934 that is incorporated
     by  reference  in the  Registration  Statement  shall be deemed to be a new
     Registration  Statement relating to the securities offered therein, and the
     offering of such  securities at that time shall be deemed to be the initial
     bona fide offering thereof.

5.   Insofar as indemnification for liabilities arising under the Securities Act
     of 1933 may be permitted to directors,  officers and controlling persons of
     the  Registrant  pursuant to the foregoing  provisions,  or otherwise,  the
     Registrant  has been  advised  that in the  opinion of the  Securities  and
     Exchange  Commission  such  indemnification  is  against  public  policy as
     expressed in the Act and is, therefore,  unenforceable. In the event that a
     claim for indemnification  against such liabilities (other than the payment
     by the  Registrant of expenses  incurred or paid by a director,  officer or
     controlling  person of the  Registrant  in the  successful  defense  of any
     action,  suit or  proceeding)  is  asserted  by such  director,  officer or
     controlling person in connection with the securities being registered,  the
     Registrant  will,  unless in the opinion of its counsel the matter has been
     settled  by  controlling  precedent,  submit  to  a  court  of  appropriate
     jurisdiction  the question  whether such  indemnification  by it is against
     public  policy as  expressed  in the Act and will be  governed by the final
     adjudication of such issue.
EXHIBIT INDEX
Exhibit Number             Description
5                    Opinion of Luse Lehman Gorman Pomerenk & Schick, A Professional Corporation
                           as to the legality of the Common Stock registered hereby.

    10.2                   Liberty Bancorp, Inc. 1991 Stock Option Plan for Outside Directors

    10.3                   Liberty Bancorp, Inc. 1991 Incentive Stock Option Plan

    23.1                   Consent of Luse Lehman Gorman Pomerenk & Schick, P.C.
                           (contained in the opinion included as Exhibit 5)

    23.2                   Consent of KPMG LLP
SIGNATURES

     The Registrant. Pursuant to the requirements of the Securities Act of 1933,
the registrant certifies that it has reasonable grounds to believe that it meets
all of the  requirements  for  filing  on  Form  S-8 and has  duly  caused  this
registration statement to be signed on its behalf by the undersigned,  thereunto
duly authorized,  in the City of Hinsdale, State of Illinois, on this 25thday of
June, 1999.

                                    ALLIANCE BANCORP

                                    By: /s/ Kenne P. Bristol
                                        Kenne P. Bristol
                                        President and Chief
                                        Executive Officer
                                        (Duly Authorized Representative)

                               POWER OF ATTORNEY

     We, the  undersigned  directors  and  officers  of  Alliance  Bancorp  (the
"Company") hereby severally  constitute and appoint Kenne P. Bristol as our true
and  lawful  attorney  and  agent,  to do any and all things in our names in the
capacities  indicated  below which said Kenne P.  Bristol may deem  necessary or
advisable to enable the Company to comply with the  Securities  Act of 1933, and
any  rules,   regulations  and  requirements  of  the  Securities  and  Exchange
Commission, in connection with the registration statement on Form S-8, including
specifically,  but not limited  to,  power and  authority  to sign for us in our
names in the capacities  indicated below the registration  statement and any and
all amendments  (including  post-effective  amendments)  thereto;  and we hereby
approve,  ratify and confirm all that said Kenne P. Bristol shall do or cause to
be done by virtue thereof.

     Pursuant  to  the   requirements  of  the  Securities  Act  of  1933,  this
registration  statement  has  been  signed  by  the  following  persons  in  the
capacities and on the date indicated.

By: /s/ Kenne P. Bristol                     By: /s/ Edward J. Burns
Kenne P. Bristol, President                      Edward J. Burns, Director
Chief Executive Officer and Director
(Principal Executive Officer)

Date: June 25, 1999                          Date: June 25, 1999

By: /s/ Richard A. Hojnicki                  By: /s/ Howard A. Davis
Richard A. Hojnicki, Executive Vice              Howard A. Davis, Director
President, Chief Financial Officer
and Corporate Secretary
(Principal Financial Officer)

Date: June 25, 1999                          Date: June 25, 1999

By: /s/ Ilene M. Bock                        By: /s/ Whit G. Hughes
Ilene M. Bock, Senior Vice President             Whit G. Hughes, Director
and Controller
Principal Accounting Officer)

Date: June 25, 1999                          Date: June 25, 1999

By: /s/ Fredric G. Novy                      By: /s/ Howard R. Jones
Fredric G. Novy, Chairman of the Board           Howard R. Jones, Director

Date: June 25, 1999                          Date: June 25, 1999
By: /s/ H. Verne Loeppert                    By: /s/ David D. Mill
H. Verne Loeppert, Director                      David D. Mill, Director

Date: June 25, 1999                          Date: June 25, 1999

By: /s/ Edward J. Nusrala                    By: /s/ William C. O'Donnell
Edward J. Nusrala, Director                      William C. O'Donnell, Director

Date: June 25, 1999                          Date: June 25, 1999

By: /s/ William R. Rybak                     By: /s/ Russell F. Stephens, Jr.
William R. Rybak, Director                       Russell F. Stephens, Jr.,
                                                 Director

Date: June 25, 1999                          Date: June 25, 1999

By: /s/ Donald E. Sveen                      By: /s/ Vernon B. Thomas, Jr.
Donald E. Sveen, Director                        Vernon B. Thomas, Jr., Director

Date: June 25, 1999                          Date: June 25, 1999

By: /s/ Richard E. Webber
Richard E. Webber, Director

Date: June 25, 1999
EXHIBIT 5

             OPINION OF LUSE LEHMAN GORMAN POMERENK & SCHICK, P.C.
[LETTERHEAD OF LUSE LEHMAN GORMAN POMERENK & SCHICK, P.C.]

June 28, 1999                                                     (202) 274-2000

Board of Directors
Alliance Bancorp
One Grant Square
Hinsdale, Illinois 60521

Re:Alliance Bancorp Registration Statement on Form S-8

Ladies and Gentlemen:

     You have  requested  the  opinion  of this firm as to  certain  matters  in
connection with the offer and sale of Alliance  Bancorp (the  "Company")  common
stock, par value $0.01 per share (the "Common Stock"),  pursuant to the Alliance
Bancorp 1997 Long-Term  Incentive Stock Benefit Plan, the Liberty Bancorp,  Inc.
1991 Stock Option Plan for Outside Directors and the 1991 Liberty Bancorp,  Inc.
1991 Incentive  Stock Option Plan (the "Plans").  We have reviewed the Company's
Certificate  of  Incorporation,  Registration  Statement  on Form S-8 (the "Form
S-8"), as well as applicable statutes and regulations  governing the Company and
the offer and sale of the Common Stock.

     Based on the foregoing, we are of the following opinion:

     Upon the  effectiveness  of the Form S-8,  the Common  Stock,  when sold in
     connection with the exercise of options granted pursuant to the Plans, will
     be legally issued, fully paid and non-assessable.

     This  opinion  has  been  prepared  solely  for the use of the  Company  in
connection  with the  preparation  and filing of the Form S-8, and should not be
used for any other purpose or relied upon by any other person  without the prior
written  consent of this firm.  We hereby  consent to the use of this opinion in
the Form S-8.

                                        Very truly yours,

                                        /s/ Luse Lehman Gorman Pomerenk & Schick
                                        LUSE LEHMAN GORMAN POMERENK & SCHICK
                                        A Professional Corporation
EXHIBIT 10.2

                             LIBERTY BANCORP, INC.

                  1991 STOCK OPTION PLAN FOR OUTSIDE DIRECTORS
AMENDMENT NO. 1 TO THE
                             LIBERTY BANCORP, INC.
                           1991 STOCK OPTION PLAN FOR
                               OUTSIDE DIRECTORS

     WHEREAS, the Board of Directors ("Board") of Liberty Bancorp,  Inc. desires
to amend the Liberty Bancorp,  Inc. 1991 Stock Option Plan for Outside Directors
(the "Plan") to conform to the new rules adopted by the  Securities and Exchange
Commission (SEC) as they relate to Section 16 of the Securities  Exchange Act of
1934 ;

     WHEREAS,  Section VII of the Plan  permits the Plan to be amended from time
to time subject to the Securities and Exchange Commission Rule 16b-3;

     WHEREAS,   Rule  16b-3  no  longer  requires   shareholder  approval  as  a
prerequisite to any  modification or amendment that affects the grant,  award or
other acquisition from an issuer;

     NOW,  THEREFORE,  BE IT  RESOLVED,  that the Plan  shall be, and hereby is,
amended effective as of September 1, 1996, in accordance with the following:

     A new  Section 1A.  Plan  Administration  is added to the Plan and reads as
follows:

               The Plan shall be administered by the Committee.  For purposes of
          this Directors' Option Plan, "Committee" shall mean a Committee of the
          Board consisting of either (i) at least two Non-Employee  Directors of
          the Company,  or (ii) the entire  Board of the Company.  "Non-Employee
          Director"  means,  for purposes of the Plan, a Director who (a) is not
          employed  by  the  Company  or an  affiliate;  (b)  does  not  receive
          compensation  directly or indirectly as a consultant  (or in any other
          capacity than as a Director)  greater than $60,000;  (c) does not have
          an interest in a transaction requiring disclosure under Item 404(a) of
          Regulation S-K; or (d) is not engaged in a business  relationship  for
          which  disclosure  would  be  required  pursuant  to  Item  404(b)  of
          Regulation S-K.

               The  Committee is  authorized,  subject to the  provisions of the
          Plan, to establish such rules and  regulations  as it deems  necessary
          for  the  proper  administration  of the  Plan  and to  make  whatever
          determinations  and  interpretations  in  connection  with the Plan it
          deems necessary or advisable.  All determinations and  interpretations
          made  by  the  Committee  shall  be  binding  and  conclusive  on  all
          Participants  in the  Plan  and on  their  legal  representatives  and
          beneficiaries.

               All transactions  involving a grant,  award or other  acquisition
          from the Company shall:

               (a)  be approved by the Company's full Board or by the Committee;
(b)  be approved,  or ratified,  in compliance with Section 14 of
                    the Exchange  Act, by either:  the  affirmative  vote of the
                    holders  of  a  majority  of  the  securities   present,  or
                    represented  and  entitled to vote at a meeting duly held in
                    accordance  with the laws of the state in which the  Company
                    is incorporated;  or the written consent of the holders of a
                    majority of the  securities  of the issuer  entitled to vote
                    provided  that such  ratification  occurs no later  than the
                    date of the next annual meeting of shareholders; or

               (c)  result in the  acquisition  of an option that is held by the
                    individual for a period of six months  following the date of
                    such acquisition.

II(b)  Grants to  Subsequent  Outside  Directors  is  amended to read in full as
follows:

          The  Committee  may,  from  time to time,  grant  non-statutory  stock
     options to Outside  Directors,  and, upon such terms and  conditions as the
     Committee may determine,  grant non-statutory stock options in exchange for
     and upon surrender of previously granted options under the Plan.

II(d) Exercise Price is amended to read in full as follows:

          The  purchase  price per share of Common  Stock  deliverable  upon the
     exercise of each  non-statutory  stock  option shall be  determined  by the
     Committee  on the date the option is  granted.  In general,  such  purchase
     price  shall not be less than 100% of the Fair  Market  Value of the Common
     Stock on the date of grant.  The  purchase  price per share of Common Stock
     deliverable upon the exercise of each non-statutory stock option granted in
     exchange for and upon surrender of previously  granted options shall be not
     less than 85% of the Fair Market  Value of the Common  Stock on the date of
     grant,  but in no event may the purchase price of any  non-statutory  stock
     option  be less  than the par  value of the  Common  Stock.  Shares  may be
     purchased  only upon full  payment of the  purchase  price.  Payment of the
     purchase  price may be made, in whole or in part,  through the surrender of
     shares of the Common  Stock at the Fair Market  Value of such shares on the
     date of surrender determined in the manner described in Section II(f).

III(d) Transferability is amended to read in full as follows:

          In the discretion of the Board, all or any non-statutory  stock option
     granted  hereunder may be transferable by the Outside  Director;  provided,
     however,  that the Board may limit the  transferability  of such  option or
     options to a designated class or classes of persons.
VI.  Termination  of the Plan is  amended  by  replacing  the last  sentence  as
follows:

          The Board may suspend or terminate the Plan at any time, provided that
     no such action will, without the consent of the affected individual, affect
     such individual's rights under a previously granted option.

VII. Amendment of the Plan is amended to read in full as follows:

          The Board may at any time, and from time to time,  modify or amend the
     Plan in any  respect,  or  modify or amend an option  received  by  Outside
     Directors;  provided,  however,  that no such termination,  modification or
     amendment  may affect the rights of an  individual,  without  his  consent,
     under an outstanding  option.  Any amendment or modification of the Plan or
     an outstanding  option under the Plan shall be approved by the Committee or
     the full Board of the Company.
LIBERTY BANCORP, INC.

                  1991 STOCK OPTION PLAN FOR OUTSIDE DIRECTORS

I. Purpose

     The purpose of the Liberty Bancorp, Inc. 1991 Stock Option Plan for Outside
Directors  (the  "Directors'   Option  Plan")  is  to  promote  the  growth  and
profitability  of Liberty  Bancorp,  Inc. (the  "Company")  and Liberty  Federal
Savings Bank (the "Bank"), its subsidiary, by providing an incentive in the form
of stock options to attract and retain non-employee  directors of the Company of
outstanding  competence  and to achieve  long-term  objectives of the Company by
encouraging their acquisition of an equity interest in the Company.

II. Grant of Options

     (a) Initial Grant.  Each outside  director (for purposes of this Directors'
Option Plan,  the term  "Outside  Director"  shall mean a member of the Board of
Directors  of the Company not also  serving as an employee of the Company or its
subsidiary),  who is  serving  in such  capacity  on the  date of the  Company's
initial  public  offering and at the effective  date of this  Directors'  Option
Plan, shall be granted  non-statutory stock options to purchase 31,409 shares of
the common stock of the Company ("Common Stock") subject to adjustment  pursuant
to Section IV hereof. Options granted under this paragraph shall be effective as
of the effective date as defined in Section V hereof ("Effective Date").

     (b) Grants to  Subsequent  Outside  Directors.  To the extent  options  for
shares are  available for grants under this Plan,  each Outside  Director who is
first  elected as a  director  subsequent  to the  Effective  Date  ("Subsequent
Outside Director") is hereby granted, effective as of the first day of the month
following the month in which the  Subsequent  Outside  Director is qualified and
first begins to serve as an Outside  Director,  non-statutory  stock  options to
purchase 1,653 shares of Common Stock, subject to adjustment pursuant to Section
IV, or to  purchase  such lesser  number of shares as remain in this  Directors'
Option Plan.

     If  options  for  sufficient  shares  are not  available  under the Plan to
fulfill the grant of options under Section II(b) hereof to a Subsequent  Outside
Director and  thereafter  options  become  available,  such  Subsequent  Outside
Director  shall then  receive  options to purchase an amount of shares of Common
Stock,  determined  by  dividing  pro rata  among each such  Subsequent  Outside
Director the number of options for shares then  available  under the  Directors'
Option Plan (not to exceed 1,653 shares,  subject to  adjustment,  as to any one
Subsequent  Outside  Director).  The date of grant shall be the date options for
such shares become available.

     (c) Ineligibility. An option under this Directors' Option Plan shall not be
granted to any  Outside  Director  who at any  previous  time was an employee of
either the Company or the Bank and in such  capacity was eligible to receive any
options to purchase Common Stock.
(d)  Exercise  Price.  The  exercise  price per share of the  Common  Stock
deliverable  upon  the  exercise  of each  non-statutory  stock  option  granted
pursuant to Section II(a) and II(b) hereof shall be determined as of the date of
the exercise of such option, at the discretion of the recipient, pursuant to the
formula provided in (i) or (ii) below:

               (i) The exercise price per share of the Common Stock  deliverable
          upon the exercise of each non-statutory stock option shall be equal to
          85% of the Fair Market Value of the Common Stock on the date of grant;
          provided  that the  recipient  agrees  as of the date  the  option  is
          exercised  to hold the stock  acquired  through  the  exercise  of the
          option for a period of one year and a legend appropriately restricting
          sale is placed upon the stock certificate(s) representing such shares,
          except that such restriction  shall not apply in the event of a tender
          offer or surrender of the stock in connection with a Change of Control
          (as defined in Section  II(e)  hereof) of the Company or in connection
          with a merger,  reorganization  or other similar  transaction in which
          the Company  ceases to  survive.  A legend  appropriately  restricting
          transfer  shall be placed upon the stock  certificate(s)  representing
          such shares.

               (ii) The exercise price per share of the Common Stock deliverable
          upon the exercise of each non-statutory stock option shall be equal to
          the Fair Market Value of the Common Stock on the date of grant.

     (e) Change in Control. For purposes of the Directors' Option Plan, a Change
in Control of the Company means a change in control of a nature that:  (i) would
be required  to be reported in response to Item 1 of the current  report on form
8-K,  as in effect on the date  hereof,  pursuant  to Section 13 or 15(d) of the
Securities  Exchange  Act of 1934 (the  "Exchange  Act");  or (ii)  results in a
change in  "control"  of the Bank or the Company  within the meaning of the Home
Owners Loan Act of 1933 and the Rules and Regulations  promulgated by the Office
of Thrift Supervision (or its predecessor agency), as in effect on the effective
date of this Plan. In addition to the above, a change in control shall be deemed
to have occurred at such time and payments and benefits under this Section shall
be made as (iii) any "person" (as the term is used in Section 13(d) and 14(d) of
the Exchange Act) is or becomes the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act),  directly or  indirectly,  of securities of the Bank or
the Company representing 20% or more of the Bank's or the Company's  outstanding
securities  ordinarily  having the right to vote at the  election  of  directors
except  for any  securities  of the Bank  purchased  by the  Company as the sole
stockholder  of the Bank and any  securities  purchased  by the Bank's  employee
stock ownership plan and trust; or (iv)  individuals who constitute the Board on
the date hereof (the  "Incumbent  Board")  cease for any reason to constitute at
least  a  majority  thereof,  provided  that  any  person  becoming  a  director
subsequent to the date hereof whose  election was approved by a vote of at least
three-quarters  of the  directors  comprising  the  Incumbent  Board,  or  whose
nomination for election by the Company's  shareholders  was approved by the same
nominating committee serving under an Incumbent Board, shall be, for purposes of
this clause (iv),  considered as though he were a member of the Incumbent Board;
or (v) a merger, consolidation or sale of all or substantially all the assets of
the Bank or the
Company in which the Bank or Company is not the surviving institution occurs; or
(vi) a proxy statement  soliciting  proxies from the stockholders of the Company
by someone other than the current management of the Company, seeking stockholder
approval of a plan of reorganization,  merger or consolidation of the Company or
Bank or similar  transaction with one or more  corporations as a result of which
the  outstanding  shares of the class of securities  then subject to the plan of
reorganization  are  exchanged  for  or  converted  into  cash  or  property  or
securities not issued by the Bank or the Company shall be distributed;  or (vii)
a tender offer is made for 20% or more of the voting  securities  of the Bank or
the Company.

     (f) Fair Market Value.  For purposes of the  Directors'  Option Plan,  when
used in connection  with Common Stock on a certain date, Fair Market Value means
the average of the  reported  bid and ask prices of the Common Stock as reported
by the National Association of Securities Dealers Automated Quotation System (as
published by the Wall Street  Journal,  if  published)  on such date,  or if the
Common Stock was not traded on such date, on the next preceding day on which the
Common  Stock was traded  thereon.  For  purposes of the grant of options in the
Conversion  as defined in Section V hereof,  Fair  Market  Value  shall mean the
initial public offering price of the Common stock or $10.00 per share.

III. Terms and Conditions

     (a) Option  Agreement.  Each option shall be evidenced by a written  option
agreement  between the Company and the director  specifying the number of shares
of Common Stock that may be acquired  through its exercise and  containing  such
other terms and  conditions  which are not  inconsistent  with the terms of this
grant.

     (b) Termination of Option. Each option shall expire upon the earlier of (i)
one hundred and twenty (120) months following the date of grant, or (ii) one (1)
year  following the date on which the outside  director  ceases to serve in such
capacity for any reason other than Cause.  If the Outside  Director  dies before
fully exercising any portion of an option then  exercisable,  such option may be
exercised  by such  Outside  Director's  personal  representatives),  heir(s) or
devisee(s) for the period specified in (ii) above; provided, however, that in no
event shall the option be  exercisable  more than one  hundred and twenty  (120)
months after the date of its grant.  If the Outside  Director is terminated  for
Cause all options awarded to him shall expire upon such termination.

     For  purposes  of  this  paragraph,  termination  for  "Cause"  shall  mean
termination  because of a  material  loss to the  Holding  Company or one of its
affiliates  caused  by  the  Outside  Director's  personal  dishonesty,  willful
misconduct,  breach of fiduciary duty  involving  personal  profit,  intentional
failure to perform  stated  duties or the willful  violation of any law, rule or
regulation or final cease-and-desist order.

     (c) Manner of Exercise.  The option may be exercised  from time to time, in
whole or in part,  by  delivering  a  written  notice of  exercise  to the Chief
Executive  Officer  of the  Company.  Such  notice  is  irrevocable  and must be
accompanied  by full payment of the  exercise  price (as
determined  by Section  II(d)  herein) in cash or share of  previously  acquired
Common Stock of the Company.  If previously  acquired shares of Common Stock are
tender in payment of all or part of the exercise price, the value of such shares
shall be determined as of the date of such exercise.

     (d)  Transferability.  Each option  granted hereby may be exercised only by
the  Outside  Director  to whom it is  issued  or in the  event  of the  Outside
Director's death, his or her personal  representative(s),  heir(s) or devisee(s)
pursuant to the terms of Section III(b).

IV. Common Stock Subject to the Director's Option Plan

     The shares  which shall be issued and  delivered  upon  exercise of options
granted under the Directors'  Option Plan may be either  authorized and unissued
shares of Common Stock or  authorized  and issued shares of Common Stock held by
the Company as treasury stock. The number of shares of Common Stock reserved for
issuance under the Directors' Option Plan shall not exceed 5.0% of the number of
shares of the Common Stock of the Company,  par value $.01 per share,  issued in
connection with the Conversion (165,312 shares), subject to adjustments pursuant
to this  Section IV. Any shares of Common  Stock  subject to an option which for
any reason either  terminates  unexercised or expires,  shall again be available
for issuance under the Directors' Option PLAN.

     In the event of any change or changes in the  outstanding  Common  Stock of
the  Company  by  reason  of any  stock  dividend  or  split,  recapitalization,
reorganization,  merger,  consolidation,  spin-off,  combination  or any similar
corporate  change, or other increase or decrease in such shares effected without
receipt or  payment of  consideration  by the  Company,  the number of shares of
Common Stock which may be issued under this  Directors'  Option Plan, the number
of shares of Common  Stock  subject to  options  granted  under this  Directors'
Option  Plan,  and the  option  price of such  options,  shall be  automatically
adjusted to prevent  dilution or enlargement of the rights granted to an Outside
Director under the Directors' Option Plan.

V. Effective Date of the Plan; Shareholder Ratification

     The Directors'  Option Plan after adoption by the Board of Directors  shall
become  effective  upon the  conversion  of the Bank from the  mutual to capital
stock  form  of  ownership  and  the  acquisition  of the  Bank  by the  Company
("Conversion").  Following  Conversion,  the  Directors'  Option  Plan  shall be
presented to  shareholders of the Company for  ratification  for purposes of (i)
obtaining favorable treatment under Section 16(b) of the Securities Exchange Act
of 1934  (the  "Exchange  Act");  and (ii)  maintaining  listing  on the  NASDAQ
National  Market  System;   provided,   however,  that  the  failure  to  obtain
shareholder  ratification  shall not  affect the  validity  of this Plan and the
options granted thereunder.
VI. Termination of the Plan

     The right to grant options under the Directors'  Option Plan will terminate
upon the  earlier  of ten years  after the  Effective  Date of the Plan,  or the
issuance  of 165,312  shares of Common  Stock (the  maximum  number of shares of
Common Stock reserved for under this Plan). A majority of the outstanding shares
of the Common  Stock  entitled to vote is required to terminate  the  Director's
Option Plan;  provided,  however, no such termination shall, without the consent
of the affected  individual,  affect such individual's rights under a previously
granted option.

VII. Amendment of the Plan

     The Directors' Option Plan may be amended from time to time by the Board of
Directors of the Company  provided that Section II, "Grant of Options" shall not
be  amended  more than once every six  months  other  than to  comport  with the
Internal  Revenue Code of 1986, as amended,  or the Employee  Retirement  Income
Security Act of 1974, as amended, or the rules thereunder. Except as provided in
Section IV hereof,  rights and  obligations  under any option  granted before an
amendment shall not be altered or impaired by such amendment without the written
consent of the optionee.  If the Directors'  Option Plan becomes qualified under
17 CFR ss. 16(b)-3 of the rules and regulations  promulgated  under the Exchange
Act and an amendment would require shareholder  approval under such rule 16(b)-3
to retain the Plan's  qualification,  then such amendment  shall be presented to
shareholders for  ratification,  provided,  however,  that the failure to obtain
shareholder  ratification  shall  not  affect  the  validity  of this Plan as so
amended and the options granted thereunder.

VIII. Applicable Law

     The Plan will be  administered  in accordance with the laws of the State of
Delaware.
EXHIBIT 10.3
                             LIBERTY BANCORP, INC.
                        1991 INCENTIVE STOCK OPTION PLAN
AMENDMENT NO. 1 TO THE
                             LIBERTY BANCORP, INC.
                              AMENDED AND RESTATED
                        1991 INCENTIVE STOCK OPTION PLAN

     WHEREAS, the Board of Directors ("Board") of Liberty Bancorp,  Inc. desires
to amend the Liberty  Bancorp,  Inc.  Amended and Restated 1991 Incentive  Stock
Option Plan (the "Plan") to conform to the new rules  adopted by the  Securities
and  Exchange  Commission  (SEC) as they relate to Section 16 of the  Securities
Exchange Act of 1934;

     WHEREAS, Section 16 of the Plan permits the Plan to be amended from time to
time subject to the Securities and Exchange Commission Rule 16b-3;

     WHEREAS,   Rule  16b-3  no  longer  requires   shareholder  approval  as  a
prerequisite to any  modification or amendment that affects the grant,  award or
other acquisition from an issuer;

     NOW,  THEREFORE,  BE IT  RESOLVED,  that the Plan  shall be, and hereby is,
amended effective as of September 1, 1996, in accordance with the following:

          2.   Definitions is amended as follows:

          The definition of "Committee" is amended and reads in full as follows:

               "Committee"  means a committee of the Board  consisting of either
               (i) at least two  Non-Employee  Directors of the Holding Company,
               or (ii) the entire Board of the Holding Company.

          A new definition of "Director" is added and reads as follows:

               "Director" means a member of the Board.

          A new definition of "Key Employee" is added and reads as follows:

               "Key Employee" means any person who is currently  employed by the
               Holding Company or an Affiliate who is chosen by the Committee to
               participate in the Plan.

          The  definition  of "Fair Market  Value" is amended by the addition of
          the following:

               In the event Fair Market Value cannot be determined in the manner
               described  above,  then Fair Market Value shall be  determined by
               the Committee. The
Committee  is  authorized,  but is not  required,  to  obtain  an
               independent  appraisal to determined the Fair Market Value of the
               Common Stock.

          A new  definition  of  "Non-Employee  Director"  is added and reads as
          follows:

               "Non-Employee  Director"  means,  for  purposes  of the  Plan,  a
               Director who (a) is not employed by the Holding Company; (b) does
               not receive  compensation  directly or indirectly as a consultant
               (or in any  other  capacity  than  as a  Director)  greater  than
               $60,000; (c) does not have an interest in a transaction requiring
               disclosure  under Item  404(a) of  Regulation  S-K; or (d) is not
               engaged in a business  relationship for which disclosure would be
               required pursuant to Item 404(b) of Regulation S-K.

          A new definition of "Outside  Director" is added to the Plan and reads
          as follows:

               "Outside  Director"  means a  Director  who is not an  officer or
               employee of the Holding Company.

          3. Administration is amended by the addition of the following:

               All transactions  involving a grant,  award or other  acquisition
               from the Holding Company shall:

                    (a) be approved by the  Holding  Company's  full Board or by
                    the Committee;

                    (b) be approved,  or ratified, in compliance with Section 14
                    of the Exchange Act, by either:  the affirmative vote of the
                    holders  of  a  majority  of  the  securities   present,  or
                    represented  and  entitled to vote at a meeting duly held in
                    accordance  with the laws of the state in which the  Holding
                    Company  is  incorporated;  or the  written  consent  of the
                    holders  of a  majority  of the  securities  of  the  issuer
                    entitled to vote provided that such  ratification  occurs no
                    later  than  the  date  of  the  next   annual   meeting  of
                    shareholders; or

                    (c) be held by the  Participant  for a period of six  months
                    following the date of such acquisition.

          A new Paragraph 7.1(e) is added to the Plan and reads as follows:

               (e)  Transferability.  In the discretion of the Board, all or any
               Non-statutory Stock Options granted hereunder may be transferable
               by the Participant,  provided,  however, that the Board may limit
               the  transferability  of such  Option or Options to a  designated
               class or classes of persons.
8.1(a) Price is amended to read in full as follows:

          Subject  to Section 14 of the Plan and  Section  422 of the Code,  the
     purchase price per share of Common stock  deliverable  upon the exercise of
     each Incentive  Stock Option shall be not less than 100% of the Fair Market
     Value of the Holding Company's Common stock on the Date of Grant,  However,
     if a Key Employee owns stock possessing more than 10% of the total combined
     voting  power of all  classes of Common  Stock of the  Holding  Company (or
     under Section 424(d) of the Code is deemed to own stock  representing  more
     than 10% of the total combined  voting power of all classes of stock of the
     Holding  Company  by  reason of the  ownership  of such  classes  of stock,
     directly or indirectly,  by or for any brother, sister, spouse, ancestor or
     lineal  descendent  of such  Key  Employee,  or by or for any  corporation,
     partnership,  estate or trust of which such key Employee is a  shareholder,
     partner  or  beneficiary),  the  purchase  price per share of Common  Stock
     deliverable  upon the exercise of each Incentive  Stock Option shall not be
     less than 110% of the Fair  Market  Value of the Holding  Company's  Common
     Stock on the Date of Grant.  Shares may be  purchased  only upon payment of
     the full  purchase  price.  Payment of the purchase  price may be made,  in
     whole or in part,  through the  surrender  of shares of the Common Stock of
     the Holding  Company at the Fair Market Value of such shares on the date of
     surrender determined in the manner described in Section 2(i).

8.1(c) Term of Options is amended by amending  the second  paragraph  to read in
full as follows:

          The Committee  shall  determine the date on which each Incentive Stock
     Option shall  become  exercisable  and may provide that an Incentive  Stock
     Option shall become exercisable in installments. The shares comprising each
     installment  may be  purchased  in whole or in part at any time  during the
     term of such option after such installment  becomes  exercisable,  provided
     that the amount able to be first  exercised  in a given year is  consistent
     with the  terms of  Section  422 of the Code.  To the  extent  required  by
     Section 422 of the Code, the aggregate Fair Market Value (determined at the
     time the option is granted) of the Common Stock for which  Incentive  Stock
     Options  are  exercisable  for the first time by a  Participant  during any
     calendar year (under all plans of the Holding Company and its  Affiliate's)
     shall not exceed  $100,000.  The  Committee  may,  in its sole  discretion,
     accelerate the time at which any Incentive Stock Option may be exercised in
     whole or in part,  provided that it is consistent with the terms of Section
     422 of the Code.  Notwithstanding  the  above,  in the event of a Change in
     Control of the Holding  Company,  all Incentive  Stock Options shall become
     immediately  exercisable,  unless  the  Fair  Market  Value  of the  amount
     exercisable  as a result  of a Change  in  Control  shall  exceed  $100,000
     (determined as of the Date of Grant).  In such event, the first $100,000 of
     Incentive  stock  Options  (determined  as of the Date of  Grant)  shall be
     exercisable as Incentive  Stock Options and any excess shall be exercisable
     as Non-statutory Stock Options.
8.1(e) Compliance with Code is amended by the addition of the following:

          If an Option  granted  hereunder  fails for whatever  reason to comply
     with the  provisions of Section 422 of the Code, and such failure is not or
     cannot be cured, such Option shall be a Non-statutory Stock Option.

9.1(b)  Payment is amended by the  addition of the  following  to the end of the
paragraph:

          In the  event of a Change  in  Control  in  which  pooling  accounting
     treatment is a condition  to the  transaction,  the Limited  Right shall be
     exercisable  solely for shares of stock of the Holding  Company,  or in the
     event of a merger transaction,  for shares of the acquiring  corporation or
     its  parent,  as  applicable.  The number of shares to be  received  on the
     exercise of such Limited  Right shall be  determined by dividing the amount
     of cash that would have been  available  under the first  sentence above by
     the Fair Market Value at the time of exercise of the shares  underlying the
     Option subject to the Limited Right.

     11. RIGHTS OF A SHAREHOLDER:  NONTRANSFERABILITY  is amended by the removal
of the second paragraph and is retitled RIGHTS OF A SHAREHOLDER.

     14. DILUTION AND OTHER ADJUSTMENTS is amended by the addition to the end of
the last paragraph the following:

          With respect to Incentive Stock Options,  no such adjustment  shall be
     made if it would be deemed a "modification"  of the Award under Section 424
     of the Code.

          16.  AMENDMENT  OF THE PLAN is amended  and reads in its  entirety  as
     follows:

          The Board may at any time, and from time to time,  modify or amend the
     Plan in any respect,  or modify or amend an Award received by  Participant;
     provided, however, that no such termination,  modification or amendment may
     affect  the  rights  of  a  Participant,  without  his  consent,  under  an
     outstanding  Award.  Any  amendment  or  modification  of  the  Plan  or an
     outstanding  Award under the Plan shall be approved by the Committee or the
     full Board of the Holding Company.
LIBERTY BANCORP, INC.
                              AMENDED AND RESTATED
                        1991 INCENTIVE STOCK OPTION PLAN

1.PURPOSE.

     The purpose of the Liberty  Bancorp,  Inc.  (the  "Holding  Company")  1991
Incentive Stock Option Plan as Amended and Restated,  (the "Plan") is to advance
the interests of the Holding Company and its shareholders by providing those key
employees of the Holding Company and its Affiliates,  including  Liberty Federal
Savings  Bank (the  "Bank"),  upon whose  judgment,  initiative  and efforts the
successful  conduct of the  business of the Holding  Company and its  Affiliates
largely  depends,  with additional  incentive to perform in a superior manner as
well as to attract people of experience and ability.

2. DEFINITIONS.

     (a) "Affiliate" means (i) a member of a controlled group of corporations of
which  the  Holding  Company  is a  member  or (ii) an  unincorporated  trade or
business which is under common control with the Holding Company as determined in
accordance with Section 414(c) of the Internal Revenue Code of 1986, as amended,
(the "Code") and the  regulations  issued  thereunder.  For purposes  hereof,  a
"controlled group of corporations" shall mean a controlled group of corporations
as defined in Section 1563(a) of the Code  determined  without regard to Section
1563(a)(4) and (e)(3)(C).

     (b) "Award" means a grant of Non-statutory  Stock Options,  Incentive Stock
Options, and/or Limited Rights under the provisions of this Plan.

     (c) "Board of  Directors"  or "Board"  means the board of  directors of the
Holding Company.

     (d) "Change in Control" of the Bank or Holding  Company shall mean an event
of a nature that;  (i) would be required to be reported in response to Item I of
the  current  report on Form 8-K, as in effect on the date  hereof,  pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934 (the "Exchange Act");
or (ii) results in a Change in Control of the Bank or the Holding Company within
the meaning of the Home Owners' Loan Act of 1933, as amended,  and the Rules and
Regulations  promulgated  by the Office of Thrift  Supervision  ("OTS")  (or its
predecessor agency), as in effect on the date hereof (provided, that in applying
the definition of change in control as set forth under the rules and regulations
of the OTS, the Board shall  substitute  its  judgment for that of the OTS);  or
(iii)  without  limitation  such a Change  in  Control  shall be  deemed to have
occurred at such time as (A) any "person" (as the term is used in Sections 13(d)
and 14(d) of the Exchange Act) is or becomes the "beneficial  owner" (as defined
in Rule 13d-3 under the Exchange Act), directly or indirectly,  of securities of
the Bank or the Holding  Company  representing  20% or more of the Bank's or the
Holding Company's  outstanding  securities except for any securities of the Bank
purchased by the Holding  Company in connection  with the conversion of the Bank
to the stock form and any  securities  purchased by any tax  qualified
employee  benefit plan of the Bank; or (B)  individuals who constitute the Board
on the date hereof (the "Incumbent Board") cease for any reason to constitute at
least  a  majority  thereof,  provided  that  any  person  becoming  a  director
subsequent to the date hereof whose  election was approved by a vote of at least
three-quarters  of the  directors  comprising  the  Incumbent  Board,  or  whose
nomination for election by the Holding  Company's  stockholders  was approved by
the same Nominating  Committee  serving under an Incumbent Board,  shall be, for
purposes  of this  clause  (B),  considered  as  though  he were a member of the
Incumbent Board; or (C) a plan of reorganization, merger, consolidation, sale of
all or  substantially  all the  assets  of the Bank or the  Holding  Company  or
similar  transaction  occurs in which  the Bank or  Holding  Company  is not the
resulting  entity; or (D) a solicitation of shareholders of the Holding Company,
by someone  other than the current  management of the Holding  Company,  seeking
stockholder approval of a plan of reorganization, merger or consolidation of the
Holding Company or Bank or similar  transaction with one or more corporations as
a result of which the outstanding shares of the class of securities then subject
to the plan or transaction  are exchanged for or converted into cash or property
or  securities  not  issued  by  the  Bank  or  the  Holding  Company  shall  be
distributed;  or (E) a  tender  offer  is made  for  20% or  more of the  voting
securities or the Bank of the Holding Company.

     (e) "Committee" means a committee consisting of non-employee members of the
Board of Directors,  all of whom are "disinterested  directors" as such terms is
defined under Rule 16b-3 under the Securities  Exchange Act of 1934, as amended,
(the "Exchange Act") as promulgated by the Securities and Exchange Commission.

     (f)  "Common  Stock"  means the Common  Stock of the Holding  Company,  par
value, $.01 per share or any stock exchanged for shares of Common Stock pursuant
to Section 14 hereof.

     (g) "Date of Grant"  means the actual  date on which an Award is granted by
the Committee.

     (h)  "Disability"  means the  permanent  and total  inability  by reason of
mental or physical  infirmity,  or both,  of a  Participant  to perform the work
customarily assigned to him. Additionally, a medical doctor selected or approved
by the Board of  Directors  must  advise  the  Committee  that it is either  not
possible to determine  when such  Disability  will  terminate or that it appears
probable  that such  Disability  will be permanent  during the remainder of said
Participant's lifetime.

     (i) "Fair Market  Value"  means,  when used in  connection  with the Common
Stock on a  certain  date,  the  average  of the high and low bid  prices of the
Common  Stock as reported by the  National  Association  of  Securities  Dealers
Automated  Quotation  System  (as  published  by the  Wall  Street  Journal,  if
published)  on such date or if the Common Stock was not traded on such date,  on
the next  preceding day on which the Common Stock was traded thereon or the last
previous date on which a sale is reported.  For purposes of the grant of options
in the  conversion of the Bank,  Fair Market Value shall mean the initial public
offering price of the Common Stock.

     (j) "Incentive  Stock Option" means an Option granted by the Committee to a
Participant,  which Option is designated by the Committee as an Incentive  Stock
Option pursuant to Section 8.
(k) "Limited Right" means the right to receive an amount of cash based upon
the terms set forth in Section 9.

     (1)  "Non-statutory  Stock Option" means an Option granted by the Committee
to a Participant pursuant to Section 7, which is not designated by the Committee
as an Incentive  Stock Option or which is  redesignated  by the Committee  under
Section 8 as a Non-Statutory Stock Option.

     (m)  "Option"  means the right to buy a fixed  amount of Common  Stock at a
specified price called the exercise or purchase price within a limited period of
time designated as the term of the option as granted under Section 7 or 8 of the
Plan.

     (n) "Participant" means any person who holds an outstanding Award under the
terms of the Plan.

     (o)  "Retirement"  with  respect  to a  Participant  means  termination  of
employment which constitutes  retirement under any tax qualified plan maintained
by the Bank.  However,  "Retirement"  will not be deemed  to have  occurred  for
purposes  of this  Plan if a  Participant  continues  to serve  on the  Board of
Directors  of the  Holding  Company  or the  Bank  even if such  Participant  is
receiving  retirement  benefits under any retirement plan of the Holding Company
or its Affiliates.

     (p) "Termination  for Cause" shall mean  termination  because of a material
loss  to  the  Holding  Company  or  one  of  its  subsidiaries  caused  by  the
Participant's intentional failure to perform stated duties, personal dishonesty,
willful violation of any law, rule,  regulation,  (other than traffic violations
or similar  offenses) or final cease and desist order. No act, or the failure to
act, on  Participant's  part shall be "willful"  unless  done,  or omitted to be
done,  not in good  faith  and  without  reasonable  belief  that the  action or
omission was in the best interest of the Holding Company or its subsidiaries.

3. ADMINISTRATION.

     The  Plan  shall  be  administered  by  the  Committee.  The  Committee  is
authorized,  subject to the  provisions of the Plan, to establish such rules and
regulations as it deems necessary for the proper  administration of the Plan and
to make whatever  determinations and interpretations in connection with the Plan
it deems necessary or advisable.  All determinations and interpretations made by
the Committee  shall be binding and conclusive on all  Participants  in the Plan
and on their legal representatives and beneficiaries.

4. TYPES OF AWARDS.

     The following Awards may be granted under the Plan:

          (a) Non-statutory Stock Options;
          (b) Incentive Stock Options; and
(c) Limited Rights

     as described below in paragraphs 7 through 9 of the Plan.

5. STOCK SUBJECT TO THE PLAN.

     Subject to  adjustment  as provided  in Section  14, the maximum  number of
shares reserved hereby for purchase  pursuant to the exercise of options granted
under the Plan shall not exceed  285,313  shares of Common  Stock of the Holding
Company,  par value $.01 per share,  These  shares of Common Stock may be either
authorized but unissued shares or shares previously issued and reacquired by the
Holding Company. To the extent that options and Limited Rights are granted under
the Plan, the shares  underlying  such Awards will be unavailable  for any other
use  including  future  grants  under the Plan except  that,  to the extent that
options  together  with  any  related  Limited  Rights  granted  under  the Plan
terminate, expire or are cancelled without having been exercised (in the case of
Limited  Rights,  exercised  for cash),  new Awards may be made with  respect to
these shares.  No Participant  under the Plan may receive Awards with respect to
shares of Common Stock that in the aggregate, exceed _________ shares underlying
Options in any calendar year.

6. ELIGIBILITY.

     Officers and other employees of the Holding Company or its Affiliates shall
be  eligible  to  receive  Awards  under  the Plan.  Directors  who are not also
employees  or  officers of the Holding  Company or its  Affiliates  shall not be
eligible to receive Awards under the Plan,  however,  a director who is a former
officer or other employee may continue to hold unexercised  Awards granted while
such person was eligible as provided in Section 7(d) hereof.

7. NON-STATUTORY STOCK OPTIONS.

     7.1  Grant of Non-statutory Stock Options.

          The  Committee  may,  from  time to time,  grant  Non-statutory  Stock
     Options to eligible  employees  and, upon such terms and  conditions as the
     Committee may determine,  grant  Non-statutory  options in exchange for and
     upon surrender of previously granted Awards under this Plan.  Non-statutory
     Stock Options  granted  under this Plan are subject to the following  terms
     and conditions:

          (a) Price.  The purchase  price per share of Common Stock  deliverable
     upon the exercise of each Non-statutory Stock Option shall be determined by
     the Committee on the date the option is granted. In general,  such purchase
     price shall not be less than 100% of the Fair  Market  Value of the Holding
     Company's  Common Stock on the Date of Grant.  The purchase price per share
     of Common Stock deliverable upon the exercise of each  Non-statutory  Stock
     Option  granted in exchange for and upon  surrender of  previously  granted
     Awards  shall be not less than 85% of the Fair Market  Value of the Holding
     Company's  Common  Stock on the  Date of  Grant,  but in no  event  may the
     purchase price of any Non-statutory Stock Option be less than the par value
     of the
Common  Stock.  Shares  may be  purchased  only  upon full  payment  of the
     purchase  price.  Payment of the purchase price may be made, in whole or in
     part,  through the  surrender  of shares of the Common Stock of the Holding
     Company at the Fair Market  Value of such  shares on the date of  surrender
     determined in the manner described in Section 2(i).

          (b) Terms of Options.  The term during which each Non-statutory  Stock
     Option may be exercised  shall be  determined by the  Committee,  but in no
     event shall a Non-statutory Stock Option be exercisable in whole or in part
     more than 10 years from the Date of Grant The Committee shall determine the
     date on which each Non-statutory  Stock Option shall become exercisable and
     may provide that a Non-statutory  Stock Option shall become  exercisable in
     installments.  The shares  comprising each  installment may be purchased in
     whole or in part at any time  during  the term of such  option  after  such
     installment becomes exercisable. The Committee may, in its sole discretion,
     accelerate  the  time  at  which  any  Non-statutory  Stock  Option  may be
     exercised in whole or in part. Notwithstanding the above, in the event of a
     Change in Control of the Holding Company,  all Non-statutory  Stock Options
     shall become immediately exercisable.

          (c)  Termination of  Employment.  Unless  otherwise  determined by the
     Committee,  upon the termination of a Participant's  service for any reason
     other than Disability,  Retirement, Change in Control, death or Termination
     for  Cause,  the  Participant's   Non-statutory   Stock  Options  shall  be
     exercisable only as to those shares which were  immediately  exercisable by
     the  Participant at the date of termination  and only for a period of three
     months  following  termination.  Notwithstanding  any  provision  set forth
     herein nor contained in any  Agreement  relating to the award of an Option,
     in the event of Termination for Cause,  all rights under the  Participant's
     Non-statutory Stock Options shall expire upon termination.

          Unless otherwise  determined by the Committee,  in the event of death,
     termination  of service as a result of  Disability,  Change in Control,  or
     Retirement of any Participant,  all Non-statutory Stock Options held by the
     Participant,  whether or not exercisable at such time, shall be exercisable
     immediately   by  the   Participant   or  the  legal   representatives   or
     beneficiaries  of the Participant,  and remain  exercisable for one year or
     such longer period as determined by the Committee following the date of the
     Participant's death or termination of employment due to Disability,  Change
     in Control, or Retirement provided that in no event shall the period extend
     beyond the expiration of the Non-statutory Stock Option term.

          (d)  Exception  for  Retirement.   Notwithstanding  the  general  rule
     contained in Section  7.1(c) above,  all options held by a Recipient  whose
     employment  with the Bank or an Affiliate  terminates due to Retirement and
     who,  as of the  Recipient's  last  day of  employment  with  the  Bank  or
     Affiliate, is a director of the Bank or an Affiliate shall not be forfeited
     and shall continue to be earned as determined by the  Committee;  provided,
     however, that any unearned options shall be forfeited upon such Recipient's
     termination of services as a director of the Bank or any Affiliate. Options
     earned  pursuant  to this  subsection  shall be  otherwise  subject  to the
     provisions of this Plan.
8. INCENTIVE STOCK OPTIONS.

     8.1 Grant of Incentive Stock Options.

     The Committee  may,  from time to time,  grant  Incentive  Stock Options to
eligible  employees.  Incentive Stock Options granted pursuant to the Plan shall
be subject to the following terms and conditions:

     (a) Price.  The purchase price per share of Common Stock  deliverable  upon
the exercise of each  Incentive  Stock Option shall be not less than 100% of the
Fair Market  Value of the Holding  Company's  Common Stock on the Date of Grant.
However,  if a  Participant  owns  stock  possessing  more than 10% of the total
combined voting power of all classes of Common Stock of the Holding Company, the
purchase price per share of Common Stock  deliverable  upon the exercise of each
Incentive  Stock  Option shall not be less than 110% of the Fair Market Value of
the Holding Company's Common Stock on the Date of Grant. Shares may be purchased
only upon payment of the full purchase price.  Payment of the purchase price may
be made,  in whole or in part,  through  the  surrender  of shares of the Common
Stock of the Holding Company at the Fair Market Value of such shares on the date
of surrender determined in the manner described in Section 2(i).

     (b)  Amounts of  Options.  Incentive  Stock  Options  may be granted to any
eligible employee in such amounts as determined by the Committee;  provided that
the amount  granted is consistent  with the terms of Section 422 of the Internal
Revenue Code. In the case of an option intended to qualify as an Incentive Stock
Option, the aggregate Fair Market Value (determined as of the time the option is
granted)  of the Common  Stock with  respect to which  Incentive  Stock  Options
granted  are  exercisable  for the  first  time by the  Participant  during  any
calendar year (under all plans of the Participant's employer corporation and its
parent and subsidiary corporations) shall not exceed $100,000. The provisions of
this Section  8.1(b) shall be construed and applied in  accordance  with Section
422(d) of the Code and the regulations,  if any, promulgated thereunder.  To the
extent an award under this Section 8.1 exceeds this $100,000 limit,  the portion
of the award in  excess of such  limit  shall be  deemed a  Non-statutory  Stock
Option.  The Committee shall have  discretion to redesignate  options granted as
Incentive Stock Options as Non-Statutory Stock Options. Such Non-Statutory Stock
Options shall be subject to Section 7 of the Plan.

     (c) Terms of Options. The term during which each Incentive Stock Option may
be exercised  shall be  determined  by the  Committee,  but in no event shall an
Incentive  Stock  Option be  exercisable  in whole or in part more than 10 years
from the Date of Grant. If at the time an Incentive Stock Option is granted to a
Participant, the Participant owns Common Stock representing more than 10% of the
total  combined  voting  securities  of the Holding  Company (or,  under Section
424(d) of the Code, is deemed to own Common Stock  representing more than 10% of
the total combined voting power of all classes of stock of the Holding  Company,
by reason of the ownership of such classes of stock, directly or indirectly,  by
or for any  brother,  sister,  spouse,  ancestor  or lineal  descendent  of such
Participant, or by or for any corporation, partnership, estate or trust of which
such Participant is a shareholder,  partner or beneficiary), the Incentive Stock
Option granted to such Participant shall not be exercisable after the expiration
of five years from
the Date of  Grant.  No  Incentive  Stock  Option  granted  under  this  Plan is
transferable  except  by will or the laws of  descent  and  distribution  and is
exercisable in his lifetime only by the Participant to whom it is granted.

     The Committee shall determine the date on which each Incentive Stock Option
shall become  exercisable  and may provide that an Incentive  Stock Option shall
become  exercisable in installments.  The shares comprising each installment may
be  purchased  in whole or in part at any time  during  the term of such  option
after such installment becomes exercisable,  provided that the amount able to be
first  exercised in a given year is consistent  with the terms of Section 422 of
the Code.  The Committee  may, in its sole  discretion,  accelerate  the time at
which any Incentive Stock Option may be exercised in whole or in part,  provided
that it is consistent with the terms of Section 422 of the Code. Notwithstanding
the  above,  in the event of a Change in  Control of the  Holding  Company,  all
Incentive Stock Options shall become immediately exercisable.

     (d)  Termination  of  Employment.   Unless  otherwise   determined  by  the
Committee,  upon the termination of a Participant's service for any reason other
than Disability,  Retirement, Change in Control, death or Termination for Cause,
the Participant's  Incentive Stock Options shall be exercisable only as to those
shares which were  immediately  exercisable  by the  Participant  at the date of
termination  and only  for a  period  of  three  months  following  termination.
Notwithstanding  any  provisions set forth herein nor contained in any Agreement
relating  to an award of an Option,  in the event of  Termination  for Cause all
rights  under the  Participant's  Incentive  Stock  Options  shall  expire  upon
termination.

     Unless  otherwise  determined  by the  Committee,  in the event of death or
termination  of  service  as a result  of  Disability  of any  Participant,  all
Incentive Stock Options held by such Participant,  whether or not exercisable at
such time,  shall be exercisable by the Participant or the  Participant's  legal
representatives  or beneficiaries of the Participant for one year or such longer
period as determined by the  Committee  following the date of the  Participant's
death or termination of employment as a result of Disability.  Upon  termination
of the Participant's service as a result of Retirement,  or a Change in Control,
all Incentive Stock Options held by such Participant, whether or not exercisable
at such  time,  shall be  exercisable  for a period  of one year or such  longer
period  as  determined  by the  Committee  following  the date of  Participant's
termination  of  employment,  provided  however,  that such option  shall not be
eligible for treatment as an Incentive  Stock Option in the event such option is
exercised  more  than  three  months  following  the  date of the  Participant's
termination  of service as a result of Retirement or a Change in Control.  In no
event shall the exercise  period extend  beyond the  expiration of the Incentive
Stock Option term.
(e) Compliance  with Code. The options  granted under this Section 8 of the
Plan are intended to qualify as incentive  stock  options  within the meaning of
Section  422 of the Code,  but the Holding  Company  makes no warranty as to the
qualification  of any option as an incentive  stock option within the meaning of
Section 422 of the Code.
9. LIMITED RIGHTS.

     9.1 Grant of Limited Rights.

     Simultaneously  with the grant of any  option,  the  Committee  may grant a
Limited Right with respect to all or some of the shares  covered by such option.
Limited  Rights  granted under this Plan are subject to the following  terms and
conditions:

     (a) Terms of Rights.  In no event shall a Limited Right be  exercisable  in
whole or in part before the  expiration  of six months from the Date of Grant of
the  Limited  Right.  A Limited  Right may be  exercised  only in the event of a
Change in Control of the Holding Company.

     The  Limited  Right may be  exercised  only when the  underlying  option is
eligible to be exercised,  and only when the Fair Market Value of the underlying
shares  on the day of  exercise  is  greater  than  the  exercise  price  of the
underlying option.

     Upon exercise of a Limited Right,  the underlying  option shall cease to be
exercisable.  Upon exercise or  termination  of an option,  any related  Limited
Rights shall  terminate.  The Limited Rights may be for no more than 100% of the
difference  between the  purchase  price and the Fair Market Value of the Common
Stock subject to the underlying  option.  The Limited Right is transferable only
when the underlying option is transferable and under the same conditions.

     (b) Payment.  Upon exercise of a Limited  Right,  the holder shall promptly
receive  from the  Holding  Company  an amount of cash  equal to the  difference
between the purchase price of the underlying option and the Fair Market Value of
the Common Stock subject to the underlying  option on the date the Limited Right
is  exercised,  multiplied  by the number of shares  with  respect to which such
Limited Right is being exercised.

     (c) Termination of Employment.  After the occurrence of a Change in Control
of the Holding Company,  upon the termination of a Participant's service for any
reason  other  than  Termination  for  Cause,  any  Limited  Rights  held by the
Participant  shall  then be  exercisable  for a  period  of one  year  following
termination.  In the event of Termination for Cause,  all Limited Rights held by
the Participant  shall expire  immediately.  After the occurrence of a Change in
Control of the Holding Company, upon termination of the Participant's employment
for reason of death,  Retirement or Disability,  all Limited Rights held by such
Participant shall be exercisable by the Participant or the  Participant's  legal
representative(s)  or  beneficiaries  for a period  of one year from the date of
such  termination.  In no event shall the period extend beyond the expiration of
the term of the underlying option.

10. SURRENDER OPTION.

     In the event of a  Participant's  termination  of employment as a result of
death,  Disability or Retirement,  the  Participant or the  Participant's  legal
representative(s)  or beneficiaries,  may, in a form acceptable to the Committee
make application to surrender all or part of options held by such Participant in
exchange for a cash  payment from the Holding  Company in an amount equal
to the difference  between the Fair Market Value of the Common Stock on the date
of  termination  of  employment  and the purchase  price per share of the option
surrendered.  Whether the Committee  accepts such  application  or determines to
make payment,  in whole or part, is within its absolute and sole discretion,  it
being  expressly  understood  that the  Committee is under no  obligation to any
Participant  whatsoever to make such  payments.  In the event that the Committee
accepts such  application  and the Holding  Company  determines to make payment,
such payment shall be in lieu of the exercise of the underlying  option and such
option shall cease to be exercisable.

11. RIGHTS OF A SHAREHOLDER: NONTRANSFERABILITY.

     No Participant  shall have any rights as a shareholder  with respect to any
shares covered by a Non-statutory  and/or  Incentive Stock Option until the date
of issuance of a stock  certificate for such shares.  Nothing in this Plan or in
any Award  granted  confers on any person any right to continue in the employ of
the Holding Company or its Affiliates or to continue to perform services for the
Holding Company or its Affiliates or interferes in any way with the right of the
Holding  Company or its Affiliates to terminate a  Participant's  services as an
officer or other employee at any time.

     No Award under the Plan shall be transferable by the Participant other than
by will or the laws of descent and distribution and may only be exercised during
his  lifetime  by  the  Participant,   or  by  a  legal  representative  of  the
Participant.

12. AGREEMENT WITH GRANTEES.

     Each Award of Options, and/or Limited Rights will be evidenced by a written
agreement  executed by the Participant and the Holding Company or its Affiliates
which  describes the conditions  for receiving the Awards  including the date of
Award, the purchase price if any,  applicable  periods,  and any other terms and
conditions as may be required by the Board of Directors or applicable securities
law.

13. DESIGNATION OF BENEFICIARY.

     A Participant may, with the consent of the Committee, designate a person or
persons to receive,  in the event of death,  any Award to which the  Participant
would then be entitled. Such designation will be made upon forms supplied by and
delivered to the Holding Company and may be revoked in writing. If a Participant
fails effectively to designate a beneficiary, then the Participant's estate will
be deemed to be the beneficiary.

14. DILUTION AND OTHER ADJUSTMENTS.

     In the event of any change in the outstanding shares of Common Stock of the
Holding  Company  by reason of any stock  dividend  or split,  recapitalization,
merger,  consolidation,  spin-off,  reorganization,  combination  or exchange of
shares, or other similar corporate change, or other increase or decrease in such
shares without receipt or payment of consideration  by the Holding
Company,  the Committee will make such adjustments to previously granted Awards,
to prevent dilution or enlargement of the rights of the  Participant,  including
any or all of the following:

     (a)  adjustments  in the aggregate  number or kind of shares of stock which
          may underlie future Awards under the Plan;

     (b)  adjustments  in the  aggregate  number  or kind  of  shares  of  stock
          underlying Awards already made under the Plan;

     (c)  adjustments  in the purchase  price of  outstanding  Incentive  and/or
          Non-statutory  Stock Options,  or any Limited Rights  attached to such
          options.

     No such adjustments may,  however,  materially change the value of benefits
available to a Participant under a previously granted Award.

15. TAX WITHHOLDING.

     There shall be deducted from each  distribution of cash and/or Common Stock
under the Plan the amount required by any governmental  authority to be withheld
for tax purposes.  If this Plan is qualified under 17 C.F.R.  ss.240.16b-3 under
the Exchange Act ("Rule  16b-3"),  then any  withholding  shall comply with Rule
16b-3.

16. AMENDMENT OF THE PLAN.

     The Board of Directors  may at any time,  and from time to time,  modify or
amend the Plan in any respect;  provided however,  that Section 7.1, 8.1 and 9.1
governing grants shall not be amended more than once every six months other than
to comport with the Internal  Revenue  Code or the  Employee  Retirement  Income
Security Act of 1974, as amended, if applicable and provided further that, if it
has been  determined  by the Board of  Directors to continue to qualify the Plan
under  Rule  16b-3,   shareholder  approval  shall  be  required  for  any  such
modification or amendment which:

     (a)  materially  increases  the maximum  number of shares -for which Awards
          may be granted under the Plan (subject,  however, to the provisions of
          Section 14 hereof);

     (b)  reduces the exercise  price at which  Awards may be granted  (subject,
          however, to the provisions of Section 14 hereof);

     (c)  extends the period  during  which  Awards may be granted or  exercised
          beyond the terms originally prescribed; or

     (d)  changes the persons subject to Section 16 of the Exchange Act eligible
          to participate in the Plan.
Failure to ratify or approve amendments or modifications to subsections (a)
through (d) of this Section by  shareholders  shall be effective  only as to the
specific   amendment  or  modification   requiring  such   ratification.   Other
provisions, sections, and subsections of this Plan will remain in full force and
effect

     No such  termination,  modification or amendment may affect the rights of a
Participant under an outstanding Award.

17. EFFECTIVE DATE OF PLAN.

     The Plan shall become  effective upon the consummation of the conversion of
Liberty  Federal Savings Bank from the mutual to capital stock form of ownership
(the  "Effective  Date") on December  23,  1991.  The Plan shall be presented to
shareholders for ratification for purposes of: (i) obtaining favorable treatment
under  Section  16(b) of the  Securities  Exchange Act of 1934;  (ii)  obtaining
preferential  tax treatment for Incentive Stock Options;  and (iii)  maintaining
listing on the NASDAQ National Market System.  The failure to obtain shareholder
ratification  will  not  effect  the  validity  of  the  Plan  and  the  options
thereunder,  provided, however, that if the Plan is not ratified, the Plan shall
remain in full force and effect,  and any Incentive  Stock Options granted under
the Plan shall be deemed to be Non-statutory Stock Options.

18. TERMINATION OF THE PLAN.

     The right to grant Awards under the Plan will terminate upon the earlier of
ten (10) years after the  Effective  Date of the Plan or the  issuance of Common
Stock or the exercise of options,  surrender  rights or related  Limited  Rights
equivalent to the maximum number of shares  reserved under the Plan as set forth
in Section 5. The Board of Directors  has the right to suspend or terminate  the
Plan at any time,  provided  that no such action will,  without the consent of a
Participant, adversely affect his rights under a previously granted Award.

19. APPLICABLE LAW.

     The Plan will be  administered  in accordance with the laws of the State of
Delaware.

20. COMPLIANCE WITH SECTION 16.

     If this Plan is qualified under Rule 16b-3, with respect to persons subject
to Section 16 of the Exchange Act,  transactions under this Plan are intended to
comply with all applicable  conditions of Rule 16b-3 or its successors under the
Exchange  Act.  To the  extent  any  provisions  of the  Plan or  action  by the
Committee  fail to so comply,  it shall be deemed  null and void,  to the extent
permitted by law and deemed advisable by the Committee.

IN WITNESS WHEREOF, the Bank has established this Plan, as amended and restated,
to be executed by its duly authorized  executive  officer and the corporate seal
to be affixed and duly attested, effective as of the 12th day of January, 1995.
EXHIBIT 23.2

                              CONSENT OF KPMG LLP
[LETTERHEAD OF KPMG LLP]

                             CONSENT OF INDEPENDENT
                          CERTIFIED PUBLIC ACCOUNTANTS

The Board of Directors
Alliance Bancorp:

We consent to  incorporation  by reference in the  registration  statement  (No.
36-3811768)  on Form S-8 of  Alliance  Bancorp of our report  dated  January 27,
1999, relating to the consolidated statements of financial condition of Alliance
Bancorp and  subsidiaries  as of December  31, 1998,  and 1997,  and the related
consolidated  statements of income,  changes in stockholders'  equity,  and cash
flows for each of the years in the two-year  period ended  December 31, 1998 and
the year ended September 30, 1996, which report appears in the December 31, 1998
annual report on Form 10-K of Alliance Bancorp.

/s/ KPMG LLP

Chicago, Illinois
June 28, 1999