STERLING FINANCIAL CORPORATION
                 AMENDED AND RESTATED ARTICLES OF INCORPORATION
 
 
                                   ARTICLE 1.
 
        1.      The name of the corporation is Sterling Financial Corporation.
 
 
                                   ARTICLE 2.
 
        2.      The location and post office address of the registered office
of the corporation in this Commonwealth is:
 
                           101 North Pointe Boulevard
                       Lancaster, Pennsylvania 17601-4133
 
 
                                   ARTICLE 3.
 
        3.      The corporation is incorporated under the Business Corporation
Law of the Commonwealth of Pennsylvania for the purpose of engaging in and doing
any lawful act concerning any and all lawful business for which a corporation
may be incorporated under the Business Corporation Law of the Commonwealth of
Pennsylvania.
 
 
                                   ARTICLE 4.
 
        4.      The term for which the corporation is to exist is perpetual.
 
 
                                   ARTICLE 5.
 
        5.(a)   The total authorized capital stock of the corporation shall be
eighty million (80,000,000) shares, consisting of seventy million (70,000,000)
shares of common stock of the par value of Five ($5.00) Dollars per share (the
"Common Stock") and ten million (10,000,000) shares of preferred stock which may
be issued in one or more classes or series, in whole or in part (the "Preferred
Stock").
 
          (b)   The shares of Common Stock shall constitute a single class. The
shares of Preferred Stock shall be without nominal or par value, except that the
amendment authorizing the initial issuance of any class or series, adopted by
the Board of Directors, may provide that the shares of any class or series shall
have a specified par value per share, in which event all of the shares of that
class or series shall have the par value per share so specified.
 
          (c)   The authority to fix and determine, by resolution, the par
value, voting powers, full or limited, or no voting powers, and the
designations, preferences and relative, participating, optional or other special
rights, if any, and qualifications, limitations or restrictions, if any,
including specifically, but not limited to, dividend rights, conversion rights,
redemption rights and liquidation preferences, if any, of any series of
Preferred Stock (or the entire class of Preferred Stock if no shares have been
issued), the number of shares constituting any series and the terms and
conditions of the issue, is hereby expressly granted to and vested in the Board
of Directors. Prior to the issuance of any shares of Preferred Stock, a
statement setting forth the resolution or resolutions and the number of shares
of Preferred Stock of each class or series shall be executed and filed in
accordance with law. Unless otherwise provided in any resolution or resolutions,
the number of shares of capital stock of any class or series may be increased or
decreased (but not below the number of shares then outstanding), by a statement
likewise executed and filed, setting forth a statement that a specified increase
or decrease has been authorized and directed by a
 
 
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                                  EXHIBIT 3 (i)
 
resolution or resolutions adopted by the Board of Directors of the corporation.
In case the number of shares shall be decreased, the number of shares so
specified in the statement shall resume the status they had prior to the
adoption of the first resolution or resolutions.
 
 
                                   ARTICLE 6.
 
        6.      [Intentionally Omitted.]
 
 
                                   ARTICLE 7.
 
        7.      [Intentionally Omitted.]
 
 
                                   ARTICLE 8.
 
        8.      The shareholders of the corporation shall not have the right to
cumulate their votes for the election of directors.
 
 
                                   ARTICLE 9.
 
        9.(a)   Except as provided in Section (b) of this Article, each
shareholder of the corporation shall, subject to such terms and conditions as
may by resolution be established by the Board of Directors, have the preemptive
right to purchase: (i) shares of the $5.00 par value common stock of the
corporation which are to be issued for cash, and (ii) any other securities or
obligations to be issued for cash by the corporation which are (or which may
through conversion, exercise or otherwise become) entitled to vote in the
election of directors. The Board of Directors shall have full, complete and
exclusive authority to establish the terms and conditions upon which such
preemptive rights shall be extended to and may be exercised by the shareholders,
which authority shall include, but shall not be limited to, the power to fix the
price at which such shares or other securities or obligations shall be offered
to the shareholders, to establish the time and manner in which such preemptive
rights may be exercised, and to make such adjustments as may be necessary to
avoid the issuance of fractional interests in shares or other securities or
obligations. Shares or other securities or obligations of the corporation which
have been offered to the shareholders pursuant to terms and conditions
established by the Board of Directors and which have not been purchased by the
shareholders in accordance therewith may at any time thereafter be offered for
sale to other persons at a price which is not less than the price at which such
shares or other securities or obligations were offered to the shareholders.
 
          (b)   The preemptive rights provided for in Section (a) of this
Article shall not apply with respect to: (i) the sale of shares or other
securities or obligations of the corporation which are held in the treasury of
the corporation, (ii) the sale or issuance of shares or other securities or
obligations of the corporation pursuant to the terms of any dividend
reinvestment plan or similar plan which may now exist or hereafter be adopted by
the corporation, (iii) the sale or issuance of shares or other securities or
obligations of the corporation to employees of the corporation or to employees
of any subsidiary of the corporation pursuant to any incentive stock option
plan, non-qualified stock option plan, employee stock purchase plan, or other
compensation plan which may now exist or hereafter be adopted by the
corporation; or (iv) the issuance of shares or other securities or obligations
of the corporation pursuant to any merger, consolidation or other business
acquisition transaction.
 
 
                                   ARTICLE 10.
 
       10.(a)   Except as provided in Section (b) of this Article, the
affirmative vote of the holders of 75 percent of the outstanding shares entitled
to vote shall be required in order to authorize the following corporate actions:
 
                (1)     Any merger or consolidation of the corporation or any
                        Subsidiary with or into an Interested
 
 
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                                  EXHIBIT 3 (i)
 
                        Shareholder; or
 
                (2)     Any sale, lease, exchange, mortgage, pledge, transfer or
                        other disposition (whether in one transaction or in a
                        series of transactions) to, with or for the benefit of
                        any Interested Shareholder, of any assets of the
                        corporation or of any Subsidiary having an aggregate
                        fair market value equal to or greater than 5 percent of
                        consolidated stockholders' equity as reported in the
                        most recent year-end financial statements of the
                        corporation; or
 
                (3)     Any issuance, sale or transfer by the corporation or by
                        any Subsidiary, whether in one transaction or in a
                        series of transactions, of any securities of the
                        corporation or of any Subsidiary to any Interested
                        shareholder in exchange for cash, securities or other
                        consideration having an aggregate fair market value
                        equal to or greater than 5 percent of consolidated
                        stockholders' equity as reported in the most recent
                        year-end financial statements of the corporation; or
 
                (4)     Any purchase or other acquisition by the corporation or
                        by any Subsidiary, whether in one transaction or in a
                        series of transactions, of any securities of the
                        corporation from an Interested Shareholder in exchange
                        for cash, securities or other consideration having an
                        aggregate fair market value equal to or greater than 5
                        percent of consolidated stockholders' equity as reported
                        in the most recent year-end financial statements of the
                        corporation; or
 
                (5)     The adoption of any plan or proposal for the liquidation
                        or dissolution of the corporation proposed by or on
                        behalf of an Interested Shareholder; or
 
                (6)     Any reclassification of stock (including any reverse
                        stock split) or recapitalization of the corporation, or
                        any merger or consolidation of the corporation with or
                        into any Subsidiary or any other transaction (whether or
                        not with or into or otherwise involving an Interested
                        Shareholder) which has the effect, directly or
                        indirectly, of increasing the proportionate share of the
                        outstanding shares of any class of stock of the
                        corporation or of any Subsidiary which is directly or
                        indirectly owned by any Interested Shareholder (other
                        than a redemption offer extended by the corporation
                        pursuant to the provisions of Article 11); or
 
                (7)     Any transaction or series of transactions, which is
                        similar in purpose, form or effect to any of the
                        foregoing.
 
          (b)   The affirmative vote of the holders of 66 2/3% of the
outstanding shares entitled to vote shall be required in order to authorize any
corporate action described in Section (a) of this Article, if such corporate
action shall have been approved by resolution adopted by a majority of the
Continuing Directors.
 
          (c)   For purposes of this Article, the following terms shall have the
meanings set forth below:
 
                (1)     Person shall mean any individual, firm, partnership,
                        corporation or other entity.
 
                (2)     Interested Shareholder shall mean any person (other than
                        the corporation or any Subsidiary) which, as of the
                        record date for the determination of shareholders
                        entitled to vote on a proposed corporate action or
                        immediately before the consummation of such corporate
                        action, is the beneficial owner, directly or indirectly,
                        of 15 percent or more of the outstanding shares of the
                        corporation entitled to vote and any Affiliate or
                        Associate of such person.
 
                (3)     A person shall be deemed to be the beneficial owner of:
                        (a) all shares owned, directly or indirectly, by such
                        person and by its Affiliates and Associates, and (b) all
                        shares which such person and its Affiliates and
                        Associates have the right to acquire or to vote pursuant
                        to any agreement, arrangement or understanding or upon
                        the exercise of any conversion right, exchange right,
                        warrant, option or otherwise.
 
 
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                                  EXHIBIT 3 (i)
 
 
                (4)     Subsidiary shall mean any corporation of which a
                        majority of any class of equity security is owned,
                        directly or indirectly, by the corporation; provided,
                        however, that for purposes of the definition of
                        Interested Shareholder set forth in Section (c)(2) of
                        this Article, the term Subsidiary shall mean only a
                        corporation of which a majority of each class of equity
                        security is owned, directly or indirectly, by the
                        corporation.
 
                (5)     Affiliate shall mean any person which directly or
                        indirectly through one or more intermediaries, controls,
                        or is controlled by, or is under common control with the
                        person specified.
 
                (6)     Associate, when used to indicate a relationship with any
                        person, means: (a) any corporation or other organization
                        (other than the corporation or a Subsidiary) of which
                        such person is an officer or partner or is, directly or
                        indirectly, the beneficial owner of 10 percent or more
                        of any class of equity security, (b) any trust or other
                        estate in which such person has a substantial beneficial
                        interest or as to which such person serves as trustee or
                        in a similar fiduciary capacity, and (c) any relative or
                        spouse of such person, or any relative of such spouse.
 
                (7)     Continuing Director shall mean: (a) any member of the
                        Board of Directors of the corporation who is
                        unaffiliated with and is not a representative of an
                        Interested Shareholder and who was a member of the Board
                        of Directors prior to the time that any Interested
                        Shareholder became an Interested Shareholder, and (b)
                        any successor of a Continuing Director who is
                        unaffiliated with and is not a representative of an
                        Interested Shareholder and who is recommended to succeed
                        a Continuing Director by a majority of the Continuing
                        Directors then members of the Board of Directors.
 
          (d)   A majority of the Continuing Directors shall have the power and
duty to make factual determinations, on the basis of information known to them
after reasonable inquiry, as to all facts relating to the application of this
Article, including, without limitation, the following: (i) whether a person is
an Interested Shareholder, (ii) the number of shares owned beneficially by any
person, and (iii) whether a person is an Affiliate or Associate of another
person. Any such determination made in good faith shall be binding upon and
conclusive with respect to all parties.
 
          (e)   The vote specified in Sections (a) and (b) of this Article shall
be in addition to any vote, which may otherwise be required by law.
 
 
                                   ARTICLE 11.
 
     11.  (a)   Except as provided in Section (b) of this Article, in the
event that any person shall acquire beneficial ownership of 30 percent or more
of the outstanding common stock of the corporation, the corporation shall within
thirty (30) days thereafter extend to each shareholder of the corporation, other
than such person and any Affiliate or Associate of such person, an offer in
writing to redeem at any time within sixty (60) days of the date of such offer
all or any part of the common stock owned by him at a redemption price per share
equal to the greatest of the following:
 
                (1)     the book value per share of the common stock of the
                        corporation as reported in the quarterly financial
                        statement of the corporation for the quarter ended
                        immediately preceding the date of the offer; or
 
                (2)     the highest per share price paid by such person to
                        acquire any shares of the common stock of the
                        corporation within the 18-month period immediately
                        preceding the date of the offer; or
 
 
                (3)     the highest market price per share of the common stock
                        of the corporation on any trading
 
 
 
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                                  EXHIBIT 3 (i)
 
 
                        day during the 18-month period immediately preceding the
                        date of the offer.
 
          (b)   The corporation shall not be required to extend a redemption
offer to any shareholder pursuant to the provisions of Section (a) of this
Article if a majority of the Continuing Directors, by resolution adopted before
the person involved has acquired, directly or indirectly, beneficial ownership
of 15 percent or more of the outstanding common stock of the corporation, shall
have approved the acquisition by such person of 30 percent or more of the
outstanding common stock of the corporation.
 
          (c)   For purposes of this Article, the terms person, Affiliate,
Associate and Continuing Director shall have the meanings set forth in Section
(c) of Article 10.
 
          (d)   For purposes of this Article, beneficial ownership shall be
determined in accordance with the provisions of Section (c)(3) of Article 10.
 
          (e)   A majority of the Continuing Directors shall have the power and
duty to make factual determinations, on the basis of information known to them
after reasonable inquiry, as to all facts relating to the application of this
Article, including, without limitation, the following: (i) whether a person
shall have acquired beneficial ownership of 30 percent or more of the
outstanding common stock of the corporation, (ii) when such acquisition shall be
deemed to have occurred, (iii) whether a person is an Affiliate or Associate of
another person, and (iv) the applicable redemption price per share. Any such
determination made in good faith shall be binding upon and conclusive with
respect to all parties.
 
          (f)   The rights conferred upon the shareholders of the corporation in
this Article are in addition to and shall supplement any similar rights
conferred upon them under any applicable law, including, without limitation, the
provisions of Section 910 of the Pennsylvania Business Corporation Law (15 P.S.
Section 1910) as now or hereafter in effect.
 
 
                                   ARTICLE 12.
 
     12.  (a)   For purposes of this Article, the term Acquisition Proposal
shall mean any action, proposal, plan or attempt by any person (as defined in
Section (c)(1) of Article 10): (i) to make any tender or exchange offer for any
equity security of the corporation, (ii) to merge or consolidate the corporation
or any subsidiary of the corporation with or into another corporation, (iii) to
purchase or otherwise acquire all or substantially all of the assets of the
corporation or of any subsidiary of the corporation, or (iv) to effect any other
transaction or series of transactions similar in purpose, form or effect to any
of the foregoing.
 
          (b)   The Board of Directors, when evaluating an Acquisition Proposal
shall, in connection with the exercise of its judgment in determining what is in
the best interests of the corporation and its shareholders, give due
consideration to all relevant factors, including, without limitation, the
following:
 
                (1)     The adequacy of the offered consideration, not only in
                        relation to the then current market price of the
                        securities of the corporation, but also in relation to:
                        (a) the historical, present and anticipated future
                        operating results and financial position of the
                        corporation, (b) the value of the corporation in a
                        freely negotiated transaction, and (c) the prospects and
                        future value of the corporation as an independent
                        entity;
 
                (2)     The social and economic impact which the Acquisition
                        Proposal, if consummated, would have upon the customers,
                        depositors and employees of the corporation and its
                        subsidiaries and upon the communities which they serve;
 
                (3)     The reputation and business practices and experience of
                        the offeror and its management as they might affect: (a)
                        the business of the corporation and its subsidiaries,
                        (b) the future value of the securities of the
                        corporation, and (c) the customers, depositors and
                        employees of the corporation and its subsidiaries and
                        the communities which they serve; and
 
 
 
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                                  EXHIBIT 3 (i)
 
                (4)     The antitrust and other legal and regulatory issues that
                        might arise by reason of the Acquisition Proposal.
 
          (c)   The Board of Directors may, in its sole discretion, oppose,
approve or remain neutral with respect to an Acquisition Proposal on the basis
of its evaluation of what is in the best interests of the corporation and its
shareholders.
 
          (d)   In the event that the Board of Directors determines that an
Acquisition Proposal is not in the best interests of the corporation and its
shareholders and should be opposed, it may take any lawful action for this
purpose, including, without limitation, the following:
 
                (1)     Advising the shareholders of the corporation of its
                        opposition to the Acquisition Proposal;
 
                (2)     Authorizing the initiation of legal proceedings;
 
                (3)     Authorizing the initiation of opposition proceedings
                        before any regulatory authority having jurisdiction over
                        the Acquisition Proposal;
 
                (4)     Authorizing the corporation to acquire its own
                        securities;
 
                (5)     Authorizing the corporation to issue authorized but
                        unissued securities, to sell treasury stock or to grant
                        options with respect thereto; and
 
                (6)     Soliciting a more favorable offer from a third party.
 
 
                                   ARTICLE 13.
 
       13. No director of the corporation shall be removed from office by
shareholder vote, except as follows:
 
           (a)  With cause, by the affirmative vote of the holders of a majority
of the then outstanding shares of stock of the corporation entitled to vote
generally in the election of directors, voting together as a single class, at a
meeting of shareholders duly convened after notice to the shareholders of such
purpose (which notice shall be accompanied by a detailed written explanation of
the facts and circumstances constituting the basis upon which the director is
sought to be removed); or
 
           (b)  Without cause, by the affirmative vote of the holders of not
less than 75 percent of the then outstanding shares of stock of the corporation
entitled to vote generally in the election of directors, voting together as a
single class, at a meeting of shareholders duly convened after notice to the
shareholders of such purpose.
 
 
                                   ARTICLE 14.
 
       14. (a)  No action required to be taken or which may be taken at any
annual or special meeting of the shareholders or of a class of the shareholders
of the corporation may be taken without a duly called meeting and the power of
the shareholders of the corporation to consent in writing to action without a
meeting is specifically denied, except that action may be taken without a
meeting, if: (i) the number of shareholders of record is three or less, and (ii)
a consent in writing setting forth the action so taken is signed by all of the
shareholders of record and filed with the Secretary of the corporation.
 
 
          (b)   A special meeting of the shareholders of the corporation may
be called only by: (i) the Chief Executive Officer of the corporation, (ii) the
Executive Committee of the Board of Directors, or (iii) the Board of Directors
pursuant to a resolution adopted by the affirmative vote of a majority of the
whole Board of Directors. Special meetings may not be called by the
shareholders.
 
 
 
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                                  EXHIBIT 3 (i)
 
                                   ARTICLE 15.
 
       15.      The authority to make, amend, alter, change or repeal the bylaws
of the corporation is hereby expressly and solely granted to and vested in the
Board of Directors, subject always to the power of the shareholders to make,
amend, alter, change or repeal the bylaws of the corporation by the affirmative
vote of the holders of not less than 75 percent of the then outstanding shares
of stock of the corporation entitled to vote generally in the election of
directors, voting together as a single class, at a meeting of shareholders duly
convened after notice to the shareholders of such purpose.
 
 
                                   ARTICLE 16.
 
       16.      The Articles of Incorporation of the corporation may not be
amended, except as follows:
 
          (a)   Upon the affirmative vote of: (i) a majority of the Continuing
Directors (as defined in Section (c)(7) of Article 10), (ii) a majority of the
whole Board of Directors, and (iii) the holders of not less than a majority of
the then outstanding shares of stock of the corporation entitled to vote
generally in the election of directors, voting together as a single class, at a
meeting of shareholders duly convened after notice to the shareholders of such
purpose; or
 
          (b)   Upon the affirmative vote of the holders of not less than 75
percent of the then outstanding shares of stock of the corporation entitled to
vote generally in the election of directors, voting together as a single class,
at a meeting of shareholders duly convened after notice to the shareholders of
such purpose.
 
 
 
 
 
 
As approved by the Board of Directors, February 26, 2002
As approved by the shareholders, April 30, 2002