SCHEDULE 14A INFORMATION
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )

Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]

Check the appropriate box:

[ ] Preliminary Proxy Statement
[X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or
Rule 14a-12
[ ] Confidential, for Use of the Commission Only (as permitted
by Rule 14a-6(e)(2))

SANDWICH BANCORP, INC.
- ----------------------------------------------------------------
(Name of Registrant as Specified in its Charter)

- ----------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)

Payment of Filing Fee (Check the appropriate box):
[ X ] No fee required.
[ ] Fee computed on table below per Exchange Act
Rules 14a-6(i)(1) and 0-11.

1. Title of each class of securities to which
transaction applies:
________________________________________________________________

2. Aggregate number of securities to which transaction
applies:
________________________________________________________________

3. Per unit price or other underlying value of
transaction computed pursuant to Exchange Act Rule 0-11 (Set
forth the amount on which the filing fee is calculated and state
how it was determined):
________________________________________________________________

4. Proposed maximum aggregate value of transaction:

________________________________________________________________

5. Total fee paid:
________________________________________________________________

[ ] Fee paid previously with preliminary materials:

[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the Form or Schedule
and the date of its filing.

1. Amount Previously Paid:
____________________________________________

2. Form, Schedule or Registration Statement No.:
____________________________________________

3. Filing Party:
____________________________________________

4. Date Filed:
____________________________________________

[LETTERHEAD OF SANDWICH BANCORP, INC.]

April 30, 1998

Dear Stockholder:

It is my pleasure to invite you to attend the Annual Meeting of
Stockholders of Sandwich Bancorp, Inc. to be held at the Ridge
Club, Sandwich, Massachusetts, on Wednesday, June 3, 1998, at
10:00 a.m.

The attached Notice of Annual Meeting and Proxy Statement
describe the formal business to be transacted at the Meeting.
At the Meeting, stockholders will vote upon the election of
directors. During the Meeting, we will also report on the
operations of the Company. Directors and officers of the
Company, as well as a representative of KPMG Peat Marwick LLP,
the Company's independent auditors, will be present to respond
to any questions you may have.

As you may know, on March 23, 1998, the Company executed an
amended and restated agreement to merge with the 1855 Bancorp
and Compass Bank for Savings. More information about the
Merger appears in our 1997 Annual Report which accompanies this
Proxy Statement. The Merger, which is subject to regulatory and
stockholder approval, will be presented for stockholder approval
at a Special Meeting of Stockholders to be held in the second
half of 1998.

Your vote is important, regardless of the number of shares you
own. ON BEHALF OF THE BOARD OF DIRECTORS, I URGE YOU TO SIGN,
DATE AND RETURN THE ENCLOSED PROXY CARD AS SOON AS POSSIBLE,
EVEN IF YOU CURRENTLY PLAN TO ATTEND THE ANNUAL MEETING. This
will not prevent you from voting in person, but will assure that
your vote is counted if you are unable to attend the Meeting.

Your continued interest and support of Sandwich Bancorp, Inc.
are appreciated.

Sincerely,

/s/ Frederic D. Legate

Frederic D. Legate
President and Chief Executive Officer
SANDWICH BANCORP, INC.
100 OLD KINGS HIGHWAY
SANDWICH, MASSACHUSETTS 02563

________________________________________________________________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 3, 1998
________________________________________________________________

Notice is hereby given that the Annual Meeting of Stock-
holders (the "Meeting") of Sandwich Bancorp, Inc. (the
"Company"), the holding company for The Sandwich Co-operative
Bank (the "Bank"), will be held at the Ridge Club, Sandwich,
Massachusetts on Wednesday, June 3, 1998, at 10:00 a.m.

A Proxy Card and a Proxy Statement for the Meeting are
enclosed herewith.

The Meeting is for the purpose of considering and acting
upon:

1. The election of four directors of the Company; and

2. Such other matters as may properly come before the
Meeting or any adjournments thereof.

NOTE: The Board of Directors is not aware of any other
business to come before the Meeting.

Action may be taken on any one of the foregoing proposals
at the Meeting on the date specified above, or on any date or
dates to which, by original or later adjournment, the Meeting
may be adjourned. Pursuant to the Company's Bylaws stockholders
of record at the close of business on April 20, 1998, are the
stockholders entitled to vote at the Meeting and any
adjournments thereof.

Whether or not you expect to be present at the Meeting,
please complete and sign the enclosed proxy and return it
promptly in the enclosed envelope. If you do attend the Annual
Meeting and wish to vote in person, you may do so even though
you have voted an earlier proxy.

BY ORDER OF THE BOARD OF DIRECTORS

/s/ Dana S. Briggs

DANA S. BRIGGS
SECRETARY

Sandwich, Massachusetts
April 30, 1998

________________________________________________________________
IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY
THE EXPENSE OF FURTHER REQUESTS FOR PROXIES IN ORDER TO ENSURE A
QUORUM. AN ADDRESSED ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE.
NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES.
________________________________________________________________

________________________________________________________________

SANDWICH BANCORP, INC.
100 OLD KINGS HIGHWAY
SANDWICH, MASSACHUSETTS 02563
(508) 888-0026

________________________________________________________________
ANNUAL MEETING OF STOCKHOLDERS
JUNE 3, 1998
________________________________________________________________

This Proxy Statement is furnished in connection with the
solicitation of proxies by the Board of Directors of Sandwich
Bancorp, Inc. (the "Company"), the holding company for The
Sandwich Co-operative Bank (the "Bank") to be used at the Annual
Meeting of Stockholders of the Company (hereinafter called the
"Meeting") which will be held at the Ridge Club, Sandwich,
Massachusetts, on Wednesday, June 3, 1998, at 10:00 a.m. The
accompanying Notice of Annual Meeting and this Proxy Statement
are being first mailed to stockholders on or about April 30,
1998. The reorganization of the Bank into the holding company
form of ownership, and the Company becoming sole stockholder of
the Bank occurred on September 30, 1997. On March 23, 1998, the
Company executed an amended and restated agreement to merge
with the 1855 Bancorp and Compass Bank for Savings. More
information about the Merger appears in the Company's 1997
Annual Report which accompanies this Proxy Statement. The
Merger, which is subject to regulatory and stockholder approval,
will be presented for stockholder approval at a Special Meeting
of Stockholders to be held in the second half of 1998.

________________________________________________________________
VOTING AND REVOCATION OF PROXIES
________________________________________________________________

Stockholders who execute proxies retain the right to
revoke them at any time. Unless so revoked, the shares
represented by such proxies will be voted at the Meeting and all
adjournments thereof. Proxies may be revoked by written notice
to the Secretary of the Company at the address noted above, or
the filing of a later proxy, prior to a vote being taken on a
particular proposal at the Meeting. A proxy will not be voted
if a stockholder attends the Meeting and votes in person. The
presence of a stockholder at the Meeting above will not
automatically revoke such stockholder's proxy. Proxies
solicited by the Board of Directors of the Company will be voted
in accordance with the directions given therein. Where no
instructions are indicated, proxies will be voted for the
nominees for directors set forth below and in favor of each of
the proposals set forth herein for consideration at the Meeting.

The proxy confers discretionary authority on the persons
named therein to vote with respect to the election of any person
as a director where the nominee is unable to serve or for good
cause will not serve, and matters incident to the conduct of the
Meeting. If any other business is presented at the Meeting,
proxies will be voted by those named therein in accordance with
the determination of a majority of the Board of Directors.
Proxies marked as abstentions will not be counted as votes cast.
In addition, shares held in street name which have been
designated by brokers on proxy cards as not voted will not be
counted as votes cast. Proxies marked as abstentions or as
broker non-votes, however, will be treated as shares present for
purposes of determining whether a quorum is present.

________________________________________________________________
VOTING SECURITIES, PRINCIPAL HOLDERS THEREOF AND
SECURITY OWNERSHIP BY MANAGEMENT
________________________________________________________________

Stockholders of record as of the close of business on
April 20, 1998 (the "Record Date"), are entitled to one vote for
each share then held. At the Record Date, the Company had
1,947,455 shares of Common Stock, par value $1.00 per share (the
"Common Stock"), issued and outstanding. The Company did not
have any other class of equity security outstanding on the
Record Date. The presence, in person or by proxy, of at least a
majority of the total number of outstanding shares of the Common
Stock entitled to vote is necessary to constitute a quorum at
the Meeting.

Persons and groups beneficially owning in excess of 5% of
the Company's Common Stock are required to file certain reports
regarding such ownership pursuant to the Securities Exchange Act
of 1934, as amended (the "Exchange Act"). Based on such reports
and other information which management believes to be correct,
management knows of no persons who owned more than 5% of the
outstanding Common Stock as of the Record Date. The following
table sets forth, as of the Record Date, certain information as
to the Common Stock owned by all directors and executive
officers of the Company as a group.

PERCENT OF SHARES
NAME AND ADDRESS AMOUNT AND NATURE OF OF COMMON STOCK
OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP (1) OUTSTANDING
- ------------------- ------------------------ -----------------

All directors and executive 292,358 (2) 14.35%
officers as a group (16 persons)
<FN>
__________
(1) In accordance with Rule 13d-3 under the Exchange Act, a person is deemed
to be the beneficial owner, for purposes of this table, of any shares of
the Common Stock if he or she has sole or shared voting or investment
power with respect to such security, or has a right to acquire beneficial
ownership at any time within 60 days from the Record Date. Includes
options for 39,195 shares, 17,084 shares, 21,111 shares and 14,833
shares, for Messrs. Legate, Briggs, Larson and Parsons, respectively,
exercisable within 60 days of the Record Date. As used herein, "voting
power" is the power to vote or direct the voting of shares and
"investment power" is the power to dispose or direct the disposition of
shares.
(2) Includes 92,223 shares of Common Stock which may be acquired by
executive officers of the Company upon the exercise of stock
options exercisable within 60 days of the Record Date. Includes
1,658, 1,041, 1,031, 955 and 4,685 shares allocated to the
accounts of Officers Legate, Briggs, Larson, Parsons and all
directors and officers as a group, respectively, under the
Employee Stock Ownership Plan ("ESOP"), over which they have sole
voting power.
</FN>

________________________________________________________________
PROPOSAL 1 - ELECTION OF DIRECTORS
________________________________________________________________

The Company's Board of Directors is currently composed of
thirteen members. The Corporation's Articles of Organization
and Bylaws provide that Directors are to be elected for terms of
three years, approximately one-third of whom are to be elected
annually. Four directors will be elected at the Meeting, each
to serve for a three year period or until their respective
successors have been elected and qualified. The Board of
Directors has nominated for election at the Meeting, Bradford N.
Eames, Barry H. Johnson, Reale J. Lemieux and Gary A. Nickerson
to serve as directors, all of whom are currently members of the
Board. Under the Company's Bylaws, directors will be elected by
a plurality of votes cast at the Meeting.

It is intended that the proxies solicited by the Board of
Directors will be voted for the election of the above named
nominees with the terms as set forth above. If any nominee is
unable to serve, the shares represented by all valid proxies
will be voted for the election of such substitute as the Board
of Directors may recommend or the Board may reduce the number of
directors to eliminate the vacancy. At this time the Board of
Directors knows of no reason why any nominee might be
unavailable to serve.

The following table sets forth for each nominee and for
each director continuing in office, their name, age, the year he
or she first became a director of the Bank, which is the
Company's principal operating subsidiary, the year of expiration
of their present term and the number of shares and percentage of
the Company's Common Stock beneficially owned at April 20, 1998,
the Record Date. All persons were appointed as directors in
1997 in connection with the incorporation and organization of
the Company. Each director of the Company is also a member of
the Board of Directors of the Bank.

YEAR FIRST SHARES OF
AGE AT ELECTED AS PRESENT COMMON STOCK
DECEMBER 31, DIRECTOR OF TERM TO OWNED AT PERCENT
NAME 1997 THE BANK EXPIRE APRIL 20, 1998(1) OF CLASS
- ---- ------------ ----------- -------- ----------------- --------

BOARD NOMINEES FOR TERMS TO EXPIRE IN 2001

Bradford N. Eames 54 1983 1998 3,900 .20%
Barry H. Johnson 54 1976 1998 243 .01
Reale J. Lemieux 59 1986 1998 1,144 .06
Gary A. Nickerson 46 1983 1998 5,000 .25

DIRECTORS CONTINUING IN OFFICE

Frederic D. Legate 55 1981 1999 80,565 (2) 4.06
Howard P. Crowell 73 1975 1999 700 .04
David O. MacKinnon 59 1986 1999 1,384 .07
George B. Rockwell 71 1990 1999 2,500 .13
Leon Davidson 71 1982 2000 779 .04
John J. Doran 48 1991 2000 60,000 3.02
Mary F. Hebditch 66 1985 2000 5,059 .25
George L. Jackson 59 1984 2000 837 .04
Richard S. Holway 71 1994 2000 16,500 .83
<FN>
___________
(1) For the definition of "beneficial ownership," see Footnote 1 to the table
in the section entitled "Voting Securities and Principal Holders
Thereof." Unless otherwise noted, all shares are owned directly by the
named individual or by their spouses and minor children, over which
shares the named individuals exercise shared voting and investment power.
(2) Includes 39,195 shares of Common Stock for Mr. Legate which may be
acquired upon the exercise of stock options exercisable within 60 days of
the Record Date, and 1,658 shares allocated to Mr. Legate's account in
the ESOP, as to which shares Mr. Legate has the power to direct the
voting.
</FN>

The principal occupation of each nominee and director of
the Company for the last five years is set forth below.

BRADFORD N. EAMES is President of Eames Insurance Agency,
Inc. in Marion, Massachusetts and is also a member of the Board
of Assessors in the Town of Marion.

BARRY H. JOHNSON is Administrative Assistant to the
Barnstable County Sheriff. From 1995 to 1997 he served as
Executive Secretary for the Town of Oak Bluffs. He was County
Administrator of Barnstable County, Massachusetts from 1986 to
1995.

REALE J. LEMIEUX has owned and operated Bay Beach, a bed
and breakfast establishment in Sandwich, Massachusetts, since
1988.

GARY A. NICKERSON is a self-employed trial attorney with
an office, since 1983, located in Barnstable, Massachusetts. He
was formerly the Assistant District Attorney for the Cape and
Islands Districts and a Special Assistant U.S. Attorney in
Boston, Massachusetts.

FREDERIC D. LEGATE has served the Bank in various executive
capacities since 1977 and has been President and Chief Executive
Officer since 1981.
3

HOWARD P. CROWELL owns and operates Crow Farm in Sandwich,
Massachusetts.

DAVID O. MACKINNON retired from his position as
Superintendent of Wareham Public Schools in 1996. He served as
Assistant Superintendent from 1991 to 1995. Prior to that he
was Principal of the Wareham High School.

GEORGE B. ROCKWELL is retired from Arthur D. Little, Inc.
a management consulting firm, where he was Vice President and
Director of their Financial Industries Practice.

LEON DAVIDSON, currently serves as Chairman of the Board
of Directors of the Bank. Prior to his retirement in 1991, he
was an owner/operator of Kobrin and Davidson Furniture Co., Inc.
in Wareham, Massachusetts.

JOHN J. DORAN is the President of Citizens Medical
Corporation, Boston, Massachusetts, a company which he founded
in 1985.

MARY F. HEBDITCH has been a self-employed public
accountant and auditor in Sandwich, Massachusetts since 1983.

GEORGE L. JACKSON is the retired Owner, President and
Treasurer of Jackson Plumbing and Heating located in Bourne,
Massachusetts.

RICHARD S. HOLWAY is retired from Loomis Sayles & Company.
He is currently a Director of the Loomis Sayles family of mutual
funds and Chairman of the Board of Lasell College in Newton,
Massachusetts.

________________________________________________________________
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
________________________________________________________________

The Company's and the Bank's Boards of Directors conduct
their business through meetings of the Boards and through
activities of their committees. During fiscal year 1997, the
Company's Board of Directors held five meetings and the Board of
Directors of the Bank met twelve times. No director attended
fewer than 75% of the total meetings of the Board of Directors
and committees on which such Board member served during this
period.

A Nominating Committee consisting of at least five members
of the Board, one of which is the President, is appointed by the
Board of Directors for the purpose of selecting the nominees for
election as directors. The Company's Articles provide the
procedures for making nominations and states, among other
things, that any stockholder nomination to the Board of
Directors must be made in writing and delivered or mailed to the
Secretary of the Company not less than 30, nor more than 60 days
prior to the meeting of stockholders called for the election of
directors. The Nominating Committee met once in this capacity
to consider and make nominations for the nominees to be
considered for election at the Meeting.

The Executive Committee consists of Directors Davidson,
Hebditch, Johnson, Legate, Nickerson and Rockwell. No Executive
Committee meetings were held in 1997 as the full Board met
sufficiently often to conduct Company and Bank business.

The Security/Loan Committee generally meets monthly and
functions as a real estate loan review committee for loans made
by the Bank. It acts directly on all applications for loans in
excess of $500,000. The members of this Committee are Directors
Crowell, Jackson, Johnson and Lemieux. This committee met
twelve times during 1997.
4

The Finance/Audit Committee serves as an audit committee.
This Committee is composed of four directors and meets monthly
to review reports prepared by the Company's accounting staff as
well as by its internal auditor. In addition, the Finance/Audit
Committee selects the Company's independent accountants with
whom it meets to review the Company's audit. The members of the
Finance Committee are Directors Davidson, Eames, Hebditch and
Rockwell. This Committee met twelve times in this capacity
during 1997.

The Personnel Committee, which serves as a compensation
committee for the Bank, meets periodically and works with the
Company's Chief Executive Officer on various personnel issues
such as wage and salary programs and incentive compensation.
The members of this committee are Directors Doran, Holway,
MacKinnon and Nickerson. This Committee met once during 1997.

________________________________________________________________
EXECUTIVE COMPENSATION
________________________________________________________________

SUMMARY COMPENSATION TABLE

The following table sets forth cash and noncash
compensation for each of the last three fiscal years awarded to
or earned by the Chief Executive Officer and the three other
highest paid executive officers of the Company whose salary and
bonus earned in 1997 exceeded $100,000 (the "Named Executive
Officers") for services rendered in all capacities to the
Company and the Bank.

ANNUAL COMPENSATION
NAME AND ------------------- ALL OTHER
PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION(1)
- ------------------ ---- ------ ----- ---------------

Frederic D. Legate 1997 $197,625 $54,800 (2) $2,400
President, Chief Executive 1996 189,125 20,000 2,400
Officer and Director 1995 185,000 18,500 2,400

Dana S. Briggs 1997 106,923 28,610 (2) --
Senior Vice President, 1996 98,788 13,000 --
Senior Retail/Operations 1995 93,884 10,000 --
Officer and Clerk

George L. Larson 1997 103,000 33,710 (2) --
Senior Vice President, 1996 98,875 10,000 --
Chief Financial Officer 1995 94,000 9,000 --
and Treasurer

David A. Parsons 1997 118,785 41,481 (2) --
Senior Vice President and 1996 104,288 10,500 --
Senior Loan Officer 1995 98,739 12,000 --
<FN>
__________
(1) Executive officers of the Company receive indirect compensation in the
form of certain perquisites and other personal benefits. The amount of
such benefits received by the named executive officers in fiscal 1997 did
not exceed 10% of the executive officer's salary and bonus, and therefore
such amounts are not specifically described. For Mr. Legate, other
compensation consists of directors' fees paid.
(2) Includes bonuses for fiscal 1996 and fiscal 1997, both of which were paid
during fiscal 1997.
</FN>

OPTION GRANTS IN LAST FISCAL YEAR

The following table contains information concerning the
grant of stock options under the Company's Option Plans to each
of the Named Executive Officers during 1997.

INDIVIDUAL GRANTS
---------------------------------------------------- POTENTIAL REALIZABLE VALUE
% OF TOTAL AT ASSUMED ANNUAL RATES
NUMBER OF OPTIONS OF STOCK PRICE APPRECIATION
SECURITIES GRANTED TO FOR OPTION TERM
UNDERLYING EMPLOYEES EXERCISE EXPIRATION ---------------------------
NAME OPTIONS GRANTED(1) IN 1997 PRICE DATE 5% 10%
- ---- ------------------ ---------- -------- ---------- ------- --------

Frederic D. Legate 6,500 20.7% $30.6875 3/24/07 $125,450 $317,915
Dana S. Briggs 3,000 9.6 30.6875 3/24/07 57,900 146,730
George L. Larson 3,000 9.6 30.6875 3/24/07 57,900 146,730
David A. Parsons 7,500 23.9 30.6875 3/24/07 144,750 366,825
<FN>
__________
(1) Options granted vest on the anniversary date of grant at a rate of 33
1/3% per year.
</FN>

AGGREGATED OPTION EXERCISES IN 1997 AND YEAR-END OPTION VALUES

The following table sets forth information concerning
exercises of options during the year ended December 31, 1997 by
the Named Executive Officers, as well as the value of options
held by such persons at the end of the fiscal year. No SARs
have been granted.

NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
SHARES OPTIONS AT YEAR-END AT YEAR-END
ACQUIRED VALUE --------------------------- -------------------------------
NAME ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE(1) UNEXERCISABLE(2)
- ---- ----------- -------- ----------- ------------- -------------- ----------------

Frederic D. Legate 21,662 $670,685 32,362 13,334 $1,073,771 $253,479
Dana S. Briggs 5,125 141,787 14,417 5,667 465,237 103,763
George L. Larson 4,426 133,915 19,444 5,667 650,013 103,763
David A. Parsons 2,000 47,900 8,666 12,834 244,381 230,370
<FN>
__________
(1) Represents market price per share at end of fiscal year 1997 ($44.00 on
December 31, 1997) less average option exercise price per share of
$10.82, $11.73, $10.57 and $15.80 for exercisable options for Messrs.
Legate, Briggs, Larson and Parsons, respectively.
(2) Represents market price per share at end of fiscal year 1997 ($44.00 on
December 31, 1997) less average option exercise price per share of
$24.99, $25.69, $25.69 and $26.05 for unexercisable options for Messrs.
Legate, Briggs, Larson and Parsons, respectively.
</FN>

DIRECTORS' AND COMMITTEE FEES

For the fiscal year ended December 31, 1997, all non-
officer directors were paid an annual fee of $7,200. Mr.
Legate, who is also an officer of the Company, received $2,400
during fiscal 1997 for his service as a director. In addition,
the Chairman received $1,800, the Clerk of the Board received
$1,200, Security Committee members received $1,800, Finance
Committee members received $1,800 and Personnel Committee
members received $600. Fees for ad hoc committee meetings are
$125 per meeting attended.
6

DEFERRED COMPENSATION PLANS

Starting in 1983, the Bank entered into non-qualified
deferred compensation arrangements (the "1983 Deferred
Compensation Plan") with certain directors whereby in
consideration for the deferral of directors' fees, those
directors will receive in the future a fixed amount of cash
compensation. Expenses under these arrangements for the year
ended December 31, 1997 were approximately $220,000. At
December 31, 1997, the Bank's liability for these arrangements,
included in accrued expenses and other liabilities, and equaling
amounts expensed since 1983, was approximately $1.8 million.
This Plan was closed to new participants in 1990. The Bank has
acquired an amount of "Key Man" insurance on the life of each
director calculated to meet the Bank's obligations under the
1983 Deferred Compensation Plan. During 1995, a grantor trust
was established by the Bank to fund this and certain other
benefit plan liabilities. The grantor trust is the owner of the
insurance policy and the named beneficiary. Upon the death of
each of the participants, the trust will return to the Bank the
funds expensed by the Bank in connection with the policy in past
years.

Effective January 1, 1992, the Bank established a new
Deferred Compensation Plan (the "1992 Deferred Compensation
Plan") which is a non-qualified, non-contributory deferred
compensation plan instituted to allow directors of the Bank to
defer payment of all or part of their salary and fees paid or
accrued during the plan year. A previous deferred compensation
plan, the 1983 Deferred Compensation Plan, is restricted to
those participants in that plan as of January 1990. Pursuant to
the 1992 Deferred Compensation Plan, a director who elects to
participate may prospectively defer up to 100% of his
compensation during any calendar year. During 1995, a grantor
trust was established by the Bank to fund this and certain other
benefit plan liabilities. Compensation which is deferred
pursuant to the 1992 Deferred Compensation Plan is set aside in
a separate bookkeeping "account" for each participating director
and may be kept in cash or invested in mutual funds, stocks,
bonds, annuity contracts, life insurance contracts or any other
assets which the Bank may, in its sole discretion, select. The
rate of return attributable to each participating director's
account will not be less than simple interest credited annually
at the quarterly average rate on U.S. Treasury Securities
adjusted to a constant maturity of one year as published by the
Federal Reserve Board. Funds credited to the accounts of
participating directors under the plan are payable from the
grantor trust or the general assets of the Bank, and the right
of any director to collect such funds is an unsecured
contractual claim against the Bank. Upon termination of a
director's employment with the Bank (for any reason including
death, disability or retirement), the Bank will distribute the
entire amount credited to the director's account to the director
participant (or his beneficiary) in a lump sum payment or in
monthly, quarterly or semi-annual cash payments. A director
shall be fully vested in the portion of his account which is
attributable to his deferred compensation and the earnings
thereon, unless the director is terminated for "cause."

________________________________________________________________
BENEFITS
________________________________________________________________

PENSION PLAN

The Bank provides a retirement plan for all eligible
employees through the Co-operative Banks Employees Retirement
Association, a multiple employer retirement plan in which almost
all co-operative banks in Massachusetts participate. Full time
and part time employees working 1,000 hours per year must
participate after completing one year of service and reaching
the age of 21. The plan provides an annual pension benefit
equal to 1.00% of Covered Compensation, as determined by the
Social Security Administration, and 1.50% of compensation in
excess of Covered Compensation, multiplied by the number of
years of credited service. Benefits under the plan become 20%
vested after two years employment and increase in 20% increments
per year thereafter, with full vesting at six years employment.
Benefits are generally provided at age 65 to any participant
based on the average of his or her highest three consecutive
years of compensation from the Bank. The Bank provides for
early retirement at age 62. The Bank makes regular
contributions to the plan to meet these funding requirements.
Pension expenses to the Bank were approximately $317,000 for the
year ended December 31, 1997.
7

The following table illustrates annual pension benefits
for retirement in 1997 at age 65, under the most advantageous
plan provisions available for various levels of compensation and
years of service. At December 31, 1997, Messrs. Legate,
Briggs, Larson and Parsons had 32 years, 14 years, 11 years and
7 years of credited service, respectively, under the plan. This
includes the period of Mr. Legate's participation with another
co-operative bank prior to joining the Bank in 1977.

ANNUAL PENSION BENEFIT BASED ON YEARS OF SERVICE (1)

YEARS OF CREDITED SERVICE
AVERAGE FINAL ---------------------------------------------
EARNINGS (2) 10 YEARS 15 YEARS 20 YEARS 25 YEARS
- ------------- --------- --------- --------- ---------

$ 25,000 $ 2,500 $ 3,750 $ 5,000 $ 6,250
50,000 5,944 8,915 11,887 14,859
100,000 13,444 20,165 26,887 33,609
150,000 20,944 31,415 41,887 52,359
175,000 21,944 32,915 43,887 54,859
200,000 21,944 32,915 43,887 54,859
250,000 21,944 32,915 43,887 54,859
300,000 21,944 32,915 43,887 54,859
<FN>
(1) The amounts in the foregoing table are computed on a
straight life annuity basis. The foregoing amounts are not
subject to offset for social security benefits.
(2) 3-Year Average
</FN>

EMPLOYMENT AGREEMENTS

In July 1994, the Bank entered into employment agreements
with Frederic D. Legate, President, Dana S. Briggs, Senior Vice
President and George L. Larson, Senior Vice President, each of
whom are executive officers of the Bank. These replaced
employment agreements originally executed in July, 1989. In
December 1991, the Bank entered into an employment agreement
with David A. Parsons, Senior Vice President. The Agreements
are for terms of 36 months for each officer and such terms are
continued from year to year through a provision which
automatically extends the term of each contract by one year on
the anniversary date of the contract, unless the Board of
Directors notifies the employee on a timely basis that this
extension will not be granted. The agreements provide for base
compensation levels which are reviewed annually. The base
compensation levels as of December 31, 1997 for Messrs. Legate,
Briggs, Larson and Parsons are $200,000, $104,000, $104,000 and
$112,500, respectively. Each of these employment agreements
provides for the inclusion of the named individuals in any
discretionary bonus plans, customary fringe benefits, vacation
and sick leave, and disability payments.

Each of the agreements also provides that in the event
there is a "change in control" of the Bank (which is generally
defined to mean the acquisition of or power to vote more than
25% of the Bank's common stock by any person, or group acting in
concert, or the control of the election of a majority of the
Bank's directors or the exercise of a controlling influence over
the management or policies of the Bank by a person or group
acting in concert) and the employee is terminated involuntarily
in connection with such change in control or within one year
thereafter, or where the employee voluntarily terminates his
employment in connection with such change in control or within
90 days thereafter, the employee is entitled to receive in a
lump sum payment, or periodic payments for what would have been
the term of the agreement, an amount equal to 2.99 times the
employee's average annual compensation received from the Bank by
the employee during the five calendar year period immediately
prior to the date of the change of control. These agreements
also provide for a similar payment to be made to these
individuals in the event of their voluntary termination of
employment in connection with a change in control, whether
approved in advance by the Board of Directors or otherwise,
following the occurrence of certain specified events, including
an assignment of duties and

responsibility other than those normally associated with their
respective executive positions, a diminishment of their
authority or responsibility, failure to maintain benefit plans
providing at least a comparable level of benefits presently
afforded, requiring the executive to move his personal residence
or perform his principal executive functions outside a 35 mile
radius of Sandwich, Massachusetts and, in the case of Mr.
Legate, failure to reelect him to the Bank's Board of Directors.
Such payments would have amounted to $612,018, $295,821,
$323,665 and $281,538 for Messrs. Legate, Briggs, Larson and
Parsons, respectively, if made during the year ended December
31, 1997.

SUPPLEMENTAL RETIREMENT AGREEMENTS

In April 1990, the Bank entered into supplemental
retirement agreements with Messrs. Legate, Briggs and Larson. A
similar agreement was entered into with Mr. Parsons in January
1992. The agreements, which were amended in January 1995 and
March 1997, provide each individual with a supplemental
retirement benefit upon retirement as described below.

Each agreement provides that if the executive continues in
the employment of the Bank until his sixtieth (60th) birthday,
he shall be entitled to a normal retirement benefit commencing
on the first day of the month next following his actual
retirement and continuing for twenty (20) years, payable monthly
in the annual amount of sixty percent (60%) of his benefit
computation base (defined as the executive's compensation
(excluding bonus or incentive compensation) for the 36
consecutive months during which the executive's compensation is
the highest) reduced by (i) fifty percent (50%) of the
executive's primary social security retirement benefit estimated
as of the normal retirement age based on Social Security
retirement benefit formulas, and assuming level future earnings
based on his benefit computation base in effect on the date of
termination of the executive, (ii) the annual amount of benefits
payable at the normal retirement date on a life annuity basis
from the Bank's pension plan and (iii) the annual amount of
benefits payable on a life annuity basis, which is the actuarial
equivalent of the account balances at the date of determination,
based on the qualified defined contribution plan maintained and
funded by the Bank (excluding any voluntary or mandatory
employee contributions) as of the date of the agreement, or its
successors. If the executive has completed less than twenty
(20) years of service (or 240 months) with the Bank as of the
normal retirement date, then the normal retirement benefit shall
be multiplied by a fraction, the numerator of which is the
actual number of months of employment with the Bank, and the
denominator of which is two hundred and forty (240) months.

Further, each agreement provides for the payment of
benefits in the event of the disability or death of the
executive. In the event of termination of employment prior to
the normal retirement date, the executive shall be entitled to
payment of his accrued benefit as of the date of termination of
employment commencing on the normal retirement date. Benefits
shall be payable at any time after age 55, however such payments
shall be reduced by 0.25% per month for each month such payments
shall commence prior to age 60. Further, payments may be made
in the form of a lump sum. The Bank may at its own discretion
invest in various investment vehicles, including life insurance
products or annuities, or both, to assist in meeting its
obligations under the agreements. For the year ending December
31, 1997, the Bank accrued expenses of $50,198, $7,056, $18,648
and $24,898 related to the benefits for Messrs. Legate, Briggs,
Larson and Parsons, respectively. During 1995 a grantor trust
was established by the Bank to fund this and certain other
benefit plan liabilities.

The following table illustrates the annual supplemental
retirement benefits for retirement at age 60, as adjusted for
compensation level and years of service. At December 31, 1997,
Messrs. Legate, Briggs, Larson and Parsons had 20 years, 14
years, 11 years and 7 years of credited service, respectively.

SUPPLEMENTAL ANNUAL RETIREMENT BENEFIT (1)

YEARS OF CREDITED SERVICE
AVERAGE FINAL ---------------------------------------------
EARNINGS (2) 10 YEARS 15 YEARS 20 YEARS 25 YEARS
- ------------- --------- --------- --------- ---------

$100,000 $23,225 $ 29,756 $ 32,900 $ 26,125
125,000 28,850 36,788 40,400 31,750
150,000 34,475 43,819 47,900 37,375
175,000 41,225 53,381 59,900 48,625
200,000 48,725 64,631 74,900 63,625
225,000 56,225 75,881 89,900 78,625
250,000 63,725 87,131 104,900 93,625
275,000 71,225 98,381 119,900 108,625
300,000 78,725 109,631 134,900 123,625
__________
(1) The amounts in the foregoing table have not been adjusted to
reflect a reduction to benefits payable equal to (i) 50% of
the primary social security benefit, plus (ii) the annuity
value of benefits attributable to employer contributions to
any qualified defined contribution retirement plan
maintained by the Bank.
(2) Average annual compensation (excluding bonus and incentive
compensation) for the 36 consecutive months during which the
executive's compensation was the highest.
</FN>

PERSONNEL COMMITTEE REPORT ON EXECUTIVE COMPENSATION

General. The function of administering the Company's
executive compensation policies is currently performed by the
Personal Committee of the Board of Directors (the "Committee"),
which is composed entirely of outside directors. The Committee
is responsible for developing and making recommendations to the
Board concerning compensation paid to the Chief Executive
Officer and each of the other executive officers and for
overseeing all aspects of the Company's executive compensation
program, including employee and executive benefit plans.

The Committee, working in conjunction with the Finance
Committee (of the Board of Directors), makes its recommendations
to the Board concerning executive compensation on the basis of
its annual review and evaluation of the Company's and the Bank's
corporate performance and the compensation of its executive
officers as compared with other banks similar in size. To
assist it in this review, the Committee retains W. M. Sheehan &
Company Inc., and Benefits Advisors of New England, Inc., two
independent compensation and benefits consulting firms.

Executive Compensation Program. The Company's executive
compensation program, which was developed with the objective of
retaining and attracting highly qualified and motivated
executives as well as recognizing and rewarding outstanding
performance, has the following components: (i) base salaries
(subject to the terms of existing employment agreements),
(ii)performance-based incentive compensation, and (iii) stock
options and miscellaneous other fringe benefits.

Cash incentives are awarded to executive officers pursuant
to an incentive compensation plan under which executives are
entitled to receive cash payments provided the Company meets
certain corporate benchmarks and performance objectives.
Incentive compensation paid to executive officers in 1997, for
fiscal year 1997 performance, was a percentage of executive's
base compensation as of December 31, 1997. Incentive payments
equaled 15.3% for the President, 20.3% for the Senior Vice
President of Lending, 15.3% for the Senior Vice President of
Retail/Operations and 17.8% for the Senior Vice President of
Finance. Factors considered were, in addition to the executives
individual

performance, key indicators of the Company's 1997 actual
quantitative performance compared to goals/targets established
by the Board, the Company's performance in relation to all
thrifts, as well as selected New England stock thrifts with
total assets between $200 million and $1.0 billion.

Compensation of the Chief Executive Officer. The base
salary of the Chief Executive Officer is established by the
terms of the employment agreement entered into between Mr.
Legate and the Bank in 1989, updated in July of 1994. See
"Benefits -- Employment Agreements." The Chief Executive
Officer's base salary under the agreement was determined on the
basis of the findings of a formal "CEO Board Evaluation"
(designed by W.M. Sheehan & Company Inc.), and of the
Committee's review of the compensation of chief executive
officers of other stock banks similar in size to the Bank. The
Chief Executive Officer's bonus is established under the general
terms of the Bank's incentive compensation plan. Mr. Legate
received a 15.3% bonus or $30,500 in December 1997 for his and
the Company's performance in fiscal year 1997.

The Members of the Committee.

Gary A. Nickerson Richard S. Holway
John J. Doran David O. MacKinnon

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

The Bank had no "interlocking" relationships existing on
or after January 1, 1996 in which (i) any executive officer of
the Bank served as a member of the compensation committee (or
other board committee performing equivalent functions or, in the
absence of any such committee, the entire board of directors) of
another entity, one of whose executive officers served on the
Personnel Committee of the Bank, (ii) any executive officer of
the Bank served as a director of another entity, one of whose
executive officers served on the Personnel Committee of the
Bank, or (iii) any executive officer of the Bank served as a
member of the compensation committee (or other board committee
performing equivalent functions or, in the absence of any such
committee, the entire board of directors) of another entity, one
of whose executive officers served as a member of the Bank's
Board of Directors.

No member of the Board of Directors of the Bank was (a) an
officer or employee of the Bank or any of its subsidiaries
during the fiscal year ended December 31, 1997, (b) a former
officer of the Bank or any of its subsidiaries, or (c) an
insider (i.e., director, officer, director or officer nominee,
greater than 5% stockholder, or immediate family member of the
foregoing) of the Bank and directly or indirectly engaged in
transactions with the Bank or any subsidiary involving more than
the $60,000 during the fiscal year ended December 31, 1997.

Lending Policies. During fiscal 1990 the Bank's Board of
Directors voted to stop granting any new loans (except for
fully-secured passbook loans) to directors, officers or other
employees of the Bank. Loans made prior to this action were
made to directors and officers at the same rates and on the same
terms and other conditions, including interest rates, as those
offered to unaffiliated parties, and do not involve more than
the normal risk of collectability, or present other unfavorable
features to the Bank.

________________________________________________________________
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
________________________________________________________________

Under the Exchange Act, the Company's officers and directors
and all persons who own more than ten percent of the Common
Stock ("Reporting Persons") are required to file reports
detailing their ownership and changes of ownership in the Common
Stock and to furnish the Company with copies of all such
ownership reports that are filed. Based solely on the Company's
review of the copies of such ownership reports which it has
received in the past fiscal year or with respect to the past
fiscal year, or written representations from such persons that
no annual report of changes in beneficial ownership were
required, the Company believes during fiscal year 1997 and prior
fiscal years all Reporting Persons have complied with these
reporting requirements.
11

________________________________________________________________
COMPARATIVE STOCK PERFORMANCE GRAPH
________________________________________________________________

The graph and table which follow show the cumulative total
return on the Common Stock of the Bank from January 1, 1993 to
September 30, 1997 and of the Company from October 1, 1997
through December 31, 1997, compared with the cumulative total
return of the NASDAQ Stock Market Index and the SNL Thrift Index
over the same five-year period. Cumulative total return on the
stock or the index equals the total increase in value since
January 1, 1993 assuming reinvestment of all dividends paid into
the stock or the indices. The graph and table were prepared
assuming that $100 was invested in the Common Stock and in the
respective indices on January 1, 1993.

SANDWICH BANCORP, INC. AND SANDWICH CO-OPERATIVE BANK
TOTAL RETURN PERFORMANCE

12/31/92 12/31/93 12/31/94 12/31/95 12/31/96 12/31/97
-------- -------- -------- -------- -------- --------

Sandwich Bancorp, Inc.
and Sandwich Co-
Operative Bank $100 $132.41 $163.08 $214.13 $366.81 $562.75
NASDAQ - Total US 100 114.80 112.21 158.70 195.19 239.53
SNL Thrift Index 100 125.50 124.03 193.16 251.68 428.24

________________________________________________________________
INDEPENDENT AUDITORS
________________________________________________________________

The Board of Directors has heretofore renewed the Bank's
appointment of KPMG Peat Marwick LLP, independent certified
public accountants, to be its auditors for the 1998 fiscal year.
A representative of KPMG Peat Marwick LLP will be present at the
Meeting to respond to appropriate questions from stockholders
and will have the opportunity to make a statement if he or she
so desires.

________________________________________________________________
OTHER MATTERS
________________________________________________________________

The Board of Directors is not aware of any business to
come before the Meeting other than those matters described above
in this Proxy Statement. However, if any other matters should
properly come before the Meeting, it is intended that proxies in
the accompanying form will be voted in respect thereof in
accordance with the determination of a majority of the Board of
Directors.

The cost of solicitation of proxies in the form enclosed
herewith will be borne by the Company. In addition to
solicitations by mail, directors, officers, and regular
employees of the Bank may solicit proxies personally or by
telegraph or telephone without additional compensation therefor.

________________________________________________________________
FINANCIAL STATEMENTS
________________________________________________________________

The Company's 1997 Annual Report to Stockholders,
including audited financial statements prepared in conformity
with generally accepted accounting principles, has been mailed
to all stockholders of record as of the close of business on
April 20, 1998. Such audited financial statements are
incorporated herein by reference. Any stockholder who has not
received a copy of the Annual Report may obtain a copy by
writing the Company.

A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K AS
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION WILL BE
FURNISHED WITHOUT CHARGE TO STOCKHOLDERS AS OF THE RECORD DATE
UPON WRITTEN REQUEST TO DANA S. BRIGGS, SENIOR VICE PRESIDENT,
SANDWICH BANCORP, INC., P.O. BOX 959, SANDWICH, MASSACHUSETTS
02563.

________________________________________________________________
STOCKHOLDER PROPOSALS
________________________________________________________________

In order to be eligible for inclusion in the proxy
materials of the Company for next year's Annual Meeting of
Stockholders, any stockholder proposal to take action at such
meeting must be received at the Company's office at 100 Old
Kings Highway, Sandwich, Massachusetts no later than December
31, 1998. Any such proposals shall be subject to the
requirements of the proxy rules adopted under the Exchange Act.

BY ORDER OF THE BOARD OF DIRECTORS

/s/ Dana S. Briggs

DANA S. BRIGGS
SECRETARY
Sandwich, Massachusetts
April 30, 1998
13

REVOCABLE PROXY

SANDWICH BANCORP, INC.

ANNUAL MEETING OF STOCKHOLDERS
JUNE 3, 1998

The undersigned hereby appoints the Board of Directors of
Sandwich Bancorp, Inc. with full powers of substitution to act,
as attorneys and proxies for the undersigned, to vote all shares
of Common Stock of Sandwich Bancorp, Inc. which the undersigned
is entitled to vote at the Annual Meeting of Stockholders, to be
held at the Ridge Club, Sandwich, Massachusetts, on Wednesday,
June 3, 1998, at 10:00 a.m. and at any and all adjournments
thereof, as follows:

VOTE
FOR WITHHELD
--- --------
1. The election as directors of all
nominees listed below (except as
marked to the contrary below). [ ] [ ]

Bradford N. Eames
Barry H. Johnson
Reale J. Lemieux
Gary A. Nickerson

INSTRUCTION: TO WITHHOLD YOUR VOTE FOR ANY
NOMINEE(S), WRITE THAT NOMINEE'S NAME ON THE LINE BELOW.

_________________________

The Board of Directors recommends a vote "FOR" each of the
listed propositions.

________________________________________________________________
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE
SPECIFIED, THIS PROXY WILL BE VOTED FOR EACH OF THE PROPOSITIONS
STATED. IF ANY OTHER BUSINESS IS PRESENTED AT SUCH MEETING,
INCLUDING MATTERS RELATING TO THE CONDUCT OF THE MEETING, THIS
PROXY WILL BE VOTED BY THOSE NAMED IN THIS PROXY IN THEIR BEST
JUDGMENT. AT THE PRESENT TIME, THE BOARD OF DIRECTORS KNOWS OF
NO OTHER BUSINESS TO BE PRESENTED AT THE MEETING.
________________________________________________________________

THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS

Should the undersigned be present and elect to vote at the
Annual Meeting or at any adjournment thereof and after
notification to the Secretary of the Company at the Meeting of
the stockholder's decision to terminate this Proxy, then the
power of said attorneys and proxies shall be deemed terminated
and of no further force and effect.

The undersigned acknowledges receipt from the Company prior
to the execution of this Proxy of Notice of the Meeting, a Proxy
Statement dated April 30, 1998, and the Company's Annual Report
to Stockholders.

Dated: _______________, 1998

__________________________ __________________________
PRINT NAME OF STOCKHOLDER PRINT NAME OF STOCKHOLDER

__________________________ __________________________
SIGNATURE OF STOCKHOLDER SIGNATURE OF STOCKHOLDER

Please sign exactly as your name appears on the enclosed card.
When signing as attorney, executor, administrator, trustee or
guardian, please give your full title. If shares are held
jointly, each holder should sign.

[ ] To assist us in our preparation, please check here if you
currently plan to attend the Annual Meeting.

________________________________________________________________
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN THE
ENCLOSED POSTAGE-PREPAID ENVELOPE.
________________________________________________________________