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                    Granite State: Stock Repurchase Program





FOR IMMEDIATE RELEASE

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


              GRANITE STATE BANKSHARES, INC. ANNOUNCES COMPLETION
                OF STOCK REPURCHASE PROGRAM AND IMPLEMENTATION
                       OF A NEW STOCK REPURCHASE PROGRAM


Keene, New Hampshire - May 3, 2000 -- Granite State Bankshares, Inc.
(NASD: GSBI) today announces that it has completed its Stock Repurchase Program
of August 11, 1998 whereby the Company repurchased up to 5% of its common
stock. In addition, the Board of Directors has authorized another Stock
Repurchase Program whereby the Company may repurchase up to 10%, or
approximately 566,000 shares, of its outstanding common shares, from time to
time. Shares repurchased may be held in treasury, retired, or used for general
corporate purposes.

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


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