Dividend Declaration

IBM
                  

IBM Board Approves Record Increase of Regular Quarterly Cash Dividend;
Authorizes $4 Billion for Stock Repurchase

The IBM board of directors today declared a regular quarterly cash dividend of
$.30 per common share, payable June 10, 2006 to stockholders of record May 10,
2006.

Today's dividend declaration represents an increase of $.10, or 50 percent more
than the prior quarterly dividend of $.20 per common share. The percentage
increase is the largest in the history of IBM.

This is the eleventh year in a row that IBM has increased its quarterly cash
dividend, representing a total increase of 380 percent since 1996.

With the payment of the May 10 dividend, IBM will have paid 362 consecutive
quarterly dividends, starting in 1916.

The board also authorized $4 billion in additional funds for use in its stock
repurchase program. This amount is in addition to approximately $2.5 billion for
stock repurchase remaining from a prior authorization. With this new approval,
IBM now has approximately $6.5 billion for its stock repurchase program. IBM
said it will repurchase shares on the open market or in private transactions
from time to time, depending on market conditions.

Additional information, including a Q&A with IBM Treasurer Jesse Greene on IBM's
dividend and buyback strategy, is available on IBM's investor Web site at
http://www.ibm.com/investor/viewpoint/ircorner/2006/06-04-25-1.phtml.


    CONTACT: IBM
             Edward Barbini, 914-499-6565
             [e-mail]