Record Quarterly Earnings Announced at Banknorth Group

For Further Information, Contact: Brian Arsenault, SVP, Corporate Communications 207 761-8517

Portland, Maine, October 18, 2000 -- Banknorth Group, Inc. (NASDAQ: BKNG) today announced record quarterly net income of $60.6 million, or 42 cents per diluted share, for the quarter ended September 30, 2000, up 11 percent on a per share basis from net income of $56.3 million, or 38 cents per diluted share, for the same quarter a year ago.

The Company also announced its intent to repurchase up to 625,000 shares from time to time in open market transactions as market conditions warrant.

"Strong loan and fee income growth, expense control, and continued asset quality were key positive features of the quarter" said William J. Ryan, Company Chairman, President and Chief Executive Officer.

Total loans at September 30, 2000 were up 11% over September 30, 1999. For the comparable periods, commercial business loans increased 20%; consumer loans increased by 14% and commercial real estate loans were up 11%.

Noninterest income for the quarter ended September 30, 2000 increased by 17% over the same quarter a year ago, led by increases in several fee income categories. Insurance commissions increased by 29%, customer service fees by 13% and merchant and card product income by 11%.

Noninterest expenses benefited quarterly earnings by declining 4% for the quarter ended September 30, 2000 as compared to the quarter ended September 30, 1999.

Net income improved despite a 6% decline in net interest income for the quarter ended September 30, 2000, as compared to the same quarter a year ago, reflecting an increase in interest expense largely as a result of rising interest rates.

Asset quality trends remained positive. Nonperforming loans as a percentage of total loans dropped to 0.46% at September 30, 2000 as compared to 0.64% at September 30, 1999. Nonperforming assets as a percentage of total assets declined to 0.31% at September 30, 2000 as compared to 0.40% at September 30, 1999.

The Company's efficiency ratio for the quarter ended September 30, 2000 improved to 52.85%, as compared to 55.28% for the same quarter of 1999. For the same period, the Company's return on average equity was 19.31%, as compared to 18.77% and the Company's return on average assets was 1.31%, as compared to 1.23%.

The Company's net interest margin, a further reflection of the impact of rising interest rates on net interest income, decreased to 3.57% for the quarter ended September 30, 2000, as compared to 3.79% for the quarter ended September 30, 1999.

Shareholders' equity at September 30, 2000 was up 10% over shareholders' equity at September 30, 1999.

Banknorth Group, headquartered in Portland, Maine, is one of the country's 50 largest commercial banks with $18.5 billion in assets. Its Maine and New Hampshire banking subsidiaries, Peoples Heritage Bank, NA and Bank of New Hampshire, NA, respectively, each have the number one deposit market position in their respective states. The Company's Vermont banks, The Howard Bank, NA, Franklin Lamoille Bank, NA and First Vermont Bank, NA combined have that state's second largest deposit market share. First Massachusetts Bank, NA is one of the six largest banks in Massachusetts. The Company also operates in upstate New York through Evergreen Bank, NA and in north central Connecticut with GBT, a division of First Massachusetts Bank, NA.

Banknorth's subsidiary banks also operate subsidiaries in insurance brokerage, trust and investments, mortgage banking and leasing.

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