BANKNORTH GROUP, INC.

                   Management Incentive Compensation Plan

                                 OBJECTIVES
                                 ----------

1.   Increase executive focus on implementation of strategic plans to
     further (1) growth in the earnings and (2) return on assets and
     equity.

2.   Increase executive focus on decisions to improve earnings and returns
     in their subsidiary.

3.   Improve executive focus in decision-making on what is in the best
     interests of Banknorth Group, Inc. and rewards for continuously
     improving relative performance against peer banks.

4.   Provide a reasonable opportunity for payout consistent with stockholder
     expectations and Company performance.

5.   Facilitate securing, retaining and motivating the highest caliber of
     management employees.

                             PRIMARY PROVISIONS
                             ------------------

I.   THRESHOLD LEVEL

      There will be no awards made under the Incentive Compensation Plan
      ("the Plan") unless the Corporation attains at least a comprehensive
      performance rating of "2" on net income, ROAA, and ROAE targets of 1997,
      after accruing for all plan awards.

II.   CORPORATE PERFORMANCE AWARDS

      Corporate performance awards will be based on (1) Net Income, (2)
      Return on Average Assets, and (3) Return on Average Equity, measured
      against Plan after taxes and before accounting adjustments.  The total
      performance rating will be the numerical average of the ratings on each
      target objective.  The modification factor is listed in the exhibits.

III.   SUBSIDIARY UNIT PERFORMANCE AWARDS

      Subsidiary bank unit performance awards will be based on subsidiary
      net income as measured against plan and efficiency ratio, return on
      average assets, and salary and benefits as a percent of earning assets
      as measured against corporate performance targets in these areas.
      Subsidiary mortgage and Stratevest Group unit awards will be based on
      subsidiary income and profit margin as measured against plan.

IV.   RELATIVE PERFORMANCE MODIFICATION

      Performance awards will be further modified by comparing Banknorth
      Group, Inc.'s performance against a peer group of approximately 40
      similar sized banks.  The relative performance to peers will be
      determined by the ranking of a weighted average percentile for ROAE,
      weighted at 4 and ROAA, Net Interest Margin, Operating Expense/Average
      Assets, and NPAs/Assets all weighted at one each.  The modification
      factor for relative performance is listed in the exhibits.  At least
      fifty percent of the award will be paid as close as possible to the time
      that the internal performance is determined.  The remaining amount,
      adjusting for relative performance to peers, will be paid when that data
      is available.

V.   COMPENSATION LEVELS AND TARGET AWARDS

      Incentive compensation levels and the corresponding targets for 1996
      are as follows:

            Level 5 (Grade 36)         -      50% of base salary

            Level 4 (Grades 33 & 34)   -      35% of base salary

            Level 3 (Grades 31 & 32)   -      25% of base salary

            Level 2 (Grade 30)         -      20% of base salary

            Level 1 (Grade 29)         -      15% of base salary

      Base salary for each participant will equal the regular salary earned
in 1996 during the period they were employed in the compensation level.

VI.   INDIVIDUAL PERFORMANCE

      Performance awards may be modified at the discretion of the CEO and by
      approval of the Compensation Committee of the Board.  Any modification of
      an individual executive's awards will be based upon that executive's
      performance against key performance objectives (KPO's), not measured
      otherwise in the corporate and subsidiary unit performance awards.  This
      modification will be limited to 15% individually and 7.5% as  a group.

VII.   ELIGIBILITY

      An eligible participant must be an active employee at the end of the
      plan year to receive any award.  Persons hired or promoted into eligible
      positions prior to July 1 of the plan year will have their potential
      award pro-rated.  Eligible participants may be assigned by the CEO to
      alternate compensation levels during the year due to changes in pay grade
      or job responsibilities.  In such cases, their award will be pro-rated
      based on time employed in differing levels.  When managers participate in
      an incentive plan targeted to their function, they will not be eligible
      to participate in this plan.

VIII.   INDIVIDUAL TARGET AWARDS

      Category "A":
      Incentive compensation awards are determined for participants based
      100% on corporate performance.

      Category "B":
      Incentive compensation awards are determined for participants based
      50% on corporate performance and 50% on respective subsidiary unit
      performance.

      Category "C":
      Incentive compensation awards are determined for participants based
      25% on corporate performance and 75% on respective subsidiary unit
      performance.

      Eligible participants may be assigned by the CEO to alternate
      categories based on transfers, reorganization, or other factors.  Awards
      may either be prorated based on time in the category or given based on
      the category in which the participants spent the most time, at the
      discretion of the CEO.

IX.   OTHER PROVISIONS

      All plan calculations will be made based upon the audited year end
      financial statement.  No awards will be made until the date of the audit
      opinion and adjustments, if any, have been approved by the Banknorth
      Group Compensation Committee.

      The Board reserves the right to adjust performance targets and/or
      payouts under this plan in cases of significant non-recurring events.


                                    1997
                  Management Incentive Compensation Program

                Internal Performance Management System (IPMS)
                                  CORPORATE

<TABLE>
<CAPTION>
                                   Performance Levels (% of Target)
Performance         Corporate      --------------------------------
Category            Target          1    2    3     4     5
------------------------------------------------------------

<S>                 <C>             <C>  <C>  <C>   <C>   <C>
NI                  $30,051         80   90   100   110   120

ROAA                  1.11%         80   90   100   110   120

ROAE                 13.75%         80   90   100   110   120

</TABLE>

                                    1997
                  Management Incentive Compensation Program
                Internal Performance Management System (IPMS)
                                 SUBSIDIARY

<TABLE>
<CAPTION>
                                    Performance Levels (% of Target)
Performance         Subsidiary      --------------------------------
Category            Target            1    2    3     4     5
-------------------------------------------------------------

<S>                 <C>               <C>  <C>  <C>   <C>   <C>
FMB, NI             $4,001            80   90   100   110   120
FMB, ROAA              .58%           80   90   100   110   120
FMB, Effic Ratio     56.62%           80   90   100   110   120
FMB, Sal & Ben/EA      .91%           80   90   100   110   120

HB, NI              $9,118            80   90   100   110   120
HB, ROAA              1.33%           80   90   100   110   120
HB, Effic. Ratio     58.06%           80   90   100   110   120
HB, Sal & Ben/EA       .83%           80   90   100   110   120

FVB, NI             $7,763 (1)        80   90   100   110   120
FVB, ROAA             1.34%(1)        80   90   100   110   120
FVB, Effic. Ratio    54.30%(1)        80   90   100   110   120
FVB, Sal & Ben/EA      .73%(1)        80   90   100   110   120

FLB, NI             $3,939            80   90   100   110   120
FLB, ROAA             1.32%           80   90   100   110   120
FLB, Effic. Ratio    55.82%           80   90   100   110   120
FLB, Sal & Ben/EA      .86%           80   90   100   110   120

FNB, NI             $1,726 (2)        80   90   100   110   120
FNB, ROAA              .82%(2)        80   90   100   110   120
FNB, Effic. Ratio    58.17%(2)        80   90   100   110   120
FNB, Sal & Ben/EA     1.00%(2)        80   90   100   110   120

GB, NI              $1,657            80   90   100   110   120
GB, ROAA              1.13%           80   90   100   110   120
GB, Effic. Ratio     58.13%           80   90   100   110   120
GB, Sal & Ben/EA       .88%           80   90   100   110   120

WNB, NI             $  967            80   90   100   110   120
WNB, ROAA             1.27%           80   90   100   110   120
WNB, Effic. Ratio    59.57%           80   90   100   110   120
WNB, Sal & Ben/EA      .85%           80   90   100   110   120

BMC, NI             $1,042            80   90   100   110   120
BMC, Profit Margin   22.09%(3)        80   90   100   110   120

SG, NI              $  -0-            80   90   100   110   120
SG, Profit Margin    26.09%(4)        80   90   100   110   120

<F1> BMC eliminations deducted from FVB
<F2> NAB consolidated
<F3> Income before income taxes
     --------------------------------
     Net int. inc. + other income
<F4> Income before income taxes + GW amortization - net int. inc.
     -----------------------------------------------------------------
     Other income

<F5>   NOTE:  Ratio may change slightly when final Balance Sheet adjustments are
       made.
</TABLE>


                                    1997
                  Management Incentive Compensation Program

           Internal Performance Management System (IPMS) Modifier

<TABLE>
<CAPTION>
            IPMS Level              % of Target Incentive
            ---------------------------------------------
            (see Exhibits 2A, 2B)

            <C>                     <C>
            5.0                     200%
            4.5                     175%
            4.0                     150%
            3.5                     125%
            3.0                     100%
            2.5                      75%
            2.0                      50%(Threshold)
            1.5                       0%
            1.0                       0%

<F1> NOTES:   Actual performance and target incentive will be established on an
              interpolated basis.

</TABLE>

         No awards will be paid if performance falls below an IPMS of 2.0.

                                    1997
                  Management Incentive Compensation Program

           Relative Performance Management System (RPMS) Modifier

<TABLE>
<CAPTION>
           Banknorth %ile               Award
         Performance Against         Modification
           The Peer Group               Factor
         ----------------------------------------

            <C>                         <C>
            100 %ile                    150%
             90 %ile                    140%
             80 %ile                    130%
             70 %ile                    120%
             60 %ile                    110%
             50 %ile                    100%
             40 %ile                     90%
             30 %ile                     80%
             20 %ile                     50%
             10 %ile                      0%
              0 %ile                      0%

<F1> NOTE:   Actual performance and award modification factor will be
             established on an interpolated basis.
</TABLE>