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                      Granite State: Dividend News Release



FOR IMMEDIATE RELEASE

Contact: William G. Pike
         Executive Vice President & CFO
         (603) 352-1600


                   GRANITE STATE BANKSHARES, INC. ANNOUNCES
                              QUARTERLY DIVIDEND

Keene, New Hampshire - June 13, 2000 -- Granite State Bankshares, Inc.
(NASD: GSBI) today announced that the Board of Directors has declared a
regular quarterly cash dividend of $ 0.16 per share of common stock
outstanding. The dividend will be payable July 7, 2000 to stockholders of
record June 23, 2000.

Granite State Bankshares, Inc. is the parent company for Granite Bank, a
New Hampshire state-chartered commercial bank with 18 offices operating
throughout southern New Hampshire. Granite Bank is the largest independent
bank in the State of New Hampshire.


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