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                                  EXHIBIT 99.3

                       PRESS RELEASE, DATED MAY 20, 1998





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                                                 P.O. Box 1307
                                                 Hutchinson, Kansas  67504
                                                 Telephone: (316) 727-2700
REPUBLIC GROUP INCORPORATED                         Fax: (316) 727-2727
NEWS RELEASE
                                      Contact:   Janey Rife (316) 727-2711
                                                 Doyle Ramsey (316) 727-2709
FOR IMMEDIATE RELEASE                            www.republic-group.com
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              REPUBLIC TO BUILD NEW 100% RECYCLED PAPERBOARD MILL

         Hutchinson, Kan., May 20--Republic Group Incorporated (NYSE:RGC) and
its wholly-owned subsidiary Republic Paperboard Company announced today that
its Board of Directors has approved plans to build and operate a new, 100%
recycled paperboard mill with an annual capacity exceeding 220,000 tons.  The
mill will supply premium quality, gypsum- grade paperboard to external
customers, a significant portion of which will be sold under contract to James
Hardie Gypsum, Inc., a major independent supplier of gypsum wallboard in the
U.S. market.  Additionally, the mill will supply the Company's own gypsum
wallboard facility in Duke, Oklahoma, which is currently undergoing an
expansion expected to be completed during the summer to double its effective
capacity to 1.2 billion square feet annually.  While the mill design has been
optimized to make premium quality, gypsum-grade paperboard, the mill will also
have the capability to produce a variety of other paperboard products.  The
mill will be located in Lawton, Oklahoma--an advantageous location for shipping
to customers throughout North America.  Construction will commence almost
immediately with start-up expected for the end of 1999.  Total construction
costs are estimated to be approximately $150-$170 million.  Republic intends to
finance the project through debt financing.

         Phil Simpson, Chairman and President of Republic, stated, "We are
pleased to announce this project to our shareholders and investors.  This is an
important milestone in the history of the Company.  We already have a solid
reputation as a premier producer of recycled paperboard including gypsum-grade
paperboard.  This venture will make Republic one of the largest producers of
gypsum-grade paperboard in North America."

         Steve Gagnon, Executive Vice President of Republic, explained "The
Company has been planning this project for over a year.  The new mill will
utilize state-of-the-art, proven technology not yet being fully utilized in the
U.S.  The paperboard to be produced at the new mill is expected to be 20%-30%
lighter than now generally available.  This should afford gypsum wallboard
customers and end-users significant benefits in the years ahead."

         Fluor Daniel Inc. will provide the overall project management,
engineering, procurement and construction services from their Greenville, South
Carolina operations center.  Fluor Daniel is a major international engineering
and construction firm.  Marathon Engineers/Architects/Planners, LLC will
provide detailed engineering and design services from its Appleton, Wisconsin
office.  Marathon is a member of the Jaakko Poyry Group, an internationally
recognized engineering and consulting company specializing in the forest
products industries.  Voith Sulzer Paper Technology North America Inc. will
supply the recycled fiber plant and paperboard machine equipment.  Voith Sulzer
has manufacturing facilities in the United States and Europe.

         Certain matters discussed in this press release may constitute
forward-looking statements within the meaning of the federal securities laws.
These forward-looking statements are based on current expectations and entail
various risks and uncertainties.  The forward-looking statements may not be
realized due to a number of factors--including general economic and competitive
conditions, foreign currency exchange rates, weather, market acceptance of
products produced by the new mill, raw material availability and costs,
facility fuel costs, labor shortages and costs, financing risks associated with
this project, changing circumstances affecting the viability of this project
and other risks detailed from time to time in the Company's filings with the
Securities and Exchange Commission, including its annual report on Form 10-K,
quarterly reports on Form 10-Q and current reports on Form 8-K.

         Republic Group Incorporated and its wholly-owned operating
subsidiaries--Republic Paperboard Company, Halltown Paperboard Company,
Republic Recycling Company, and Republic Gypsum Company--are manufacturers of
100% recycled paperboard, recovered paper fiber and gypsum wallboard, servicing
markets nationwide.  Republic's common stock is traded on the New York Stock
Exchange under the symbol "RGC".





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