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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 15, 1999 -- Granite State Bankshares, Inc. today 
announced that the Board of Directors has declared a regular quarterly cash
dividend of $ 0.14 per share of common stock outstanding. The dividend will be
payable July 9, 1999 to stockholders of record June 25, 1999.

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
commercial bank in the State of New Hampshire.


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