EXHIBIT 99.1


                            FOR IMMEDIATE RELEASE

Contact:

Falmouth Bancorp, Inc.
Santo P. Pasqualucci,
President and Chief Executive Officer
508-548-3500


  FALMOUTH BANCORP, INC. REPORTS EFFECT OF MASSACHUSETTS TAX LEGISLATION


Falmouth, Massachusetts, March 18, 2003 - Falmouth Bancorp, Inc. (AMEX:
"FCB") (the "Company"), the holding company for Falmouth Bank (the "Bank"),
announced today that the Company will accrue a liability in the first
quarter of 2003 of approximately $572,000, representing an estimate of the
additional state tax liability, including interest (net of any federal and
state tax deductions associated with such taxes and interest), relating to
the deduction for dividends received from a real estate investment trust
subsidiary (a "REIT") for the  2000, 2001, 2002 and five months of the 2003
fiscal years.  The accrued liability is the result of new legislation
signed March 5, 2003 by the Governor of Massachusetts that amends
Massachusetts law to expressly disallow the deduction for dividends
received from a REIT.  This amendment applies retroactively to tax years
ending on or after December 31, 1999.  As a result of the enactment of this
legislation, the Company has ceased recording the tax benefits associated
with the dividend received deduction effective for the 2003 tax year and
accrued the liability described above.

Falmouth Capital Corporation ("FCC") is a REIT formed by the Bank, pursuant
to applicable tax rules, in December 1999.  Since that time and prior to
the enactment of the new legislation discussed above, the Bank has taken a
tax deduction under a Massachusetts statute that provides for a dividends
received deduction equal to 95% of certain dividend distributions made by
FCC to the Bank.  The Bank has received a notice of assessment from the
Commonwealth of Massachusetts Department of Revenue ("DOR") for the tax
years ended 2000 and 2001 based on the DOR's contention that dividend
distributions by FCC to the Bank are fully taxable in Massachusetts.  The
Company is aware that the DOR also sent similar notices to numerous other
Massachusetts financial institutions that reported a deduction for
dividends received from a REIT on their Massachusetts financial institution
excise tax returns.

The Company believes that this legislation will be challenged, especially
the retroactive provisions, on constitutional and other grounds.  The
Company would support such a challenge and otherwise intends to defend
vigorously its position that the deductibility of dividends received from
FCC was fully compliant with Massachusetts law at the time.

Falmouth Bancorp, Inc. is a publicly owned bank holding company and the
parent corporation of Falmouth Bank, a Massachusetts chartered stock co-
operative bank offering traditional financial products and services. The
Bank conducts its business through its main office located at 20 Davis
Straits, Falmouth, MA 02540, and two branches located in East Falmouth and
North Falmouth, Massachusetts. At December 31, 2002 the Company had assets
of $153.2 million and deposits of $130.1 million.