diff --git a/consensus/pbft/pbft-core_test.go b/consensus/pbft/pbft-core_test.go
index 6cb656ff696..f42dd095720 100644
--- a/consensus/pbft/pbft-core_test.go
+++ b/consensus/pbft/pbft-core_test.go
@@ -1179,6 +1179,73 @@ func TestReplicaCrash3(t *testing.T) {
 	}
 }
 
+// TestReplicaCrash4 simulates the restart with no checkpoints
+// in the store because they have been garbage collected
+// the bug occurs because the low watermark is incorrectly set to
+// be zero
+func TestReplicaCrash4(t *testing.T) {
+	validatorCount := 4
+	config := loadConfig()
+	config.Set("general.K", 2)
+	config.Set("general.logmultiplier", 2)
+	net := makePBFTNetwork(validatorCount, config)
+	defer net.stop()
+
+	twoOffline := false
+	threeOffline := true
+	net.filterFn = func(src int, dst int, msg []byte) []byte {
+		if twoOffline && dst == 2 { // 2 is 'offline'
+			return nil
+		}
+		if threeOffline && dst == 3 { // 3 is 'offline'
+			return nil
+		}
+		return msg
+	}
+
+	for i := int64(1); i <= 8; i++ {
+		net.pbftEndpoints[0].manager.Queue() <- createPbftReqBatch(i, uint64(generateBroadcaster(validatorCount)))
+	}
+	net.process() // vp0,1,2 should have a stable checkpoint for seqNo 8
+	net.process() // this second time is necessary for garbage collection it seams
+
+	// Now vp0,1,2 should be in sync with 8 executions in view 0, and vp4 should be offline
+	for i, pep := range net.pbftEndpoints {
+
+		if i == 3 {
+			// 3 is offline for this test
+			continue
+		}
+
+		if pep.pbft.view != 0 {
+			t.Errorf("Expected replica %d to be in view 1, got %d", pep.id, pep.pbft.view)
+		}
+
+		expectedExecutions := uint64(8)
+		if pep.sc.executions != expectedExecutions {
+			t.Errorf("Expected %d executions on replica %d, got %d", expectedExecutions, pep.id, pep.sc.executions)
+		}
+	}
+
+	// Create new pbft instances to restore from persistence
+	for id := 0; id < 3; id++ {
+		pe := net.pbftEndpoints[id]
+		config := loadConfig()
+		config.Set("general.K", "2")
+		pe.pbft.close()
+		pe.pbft = newPbftCore(uint64(id), config, pe.sc, events.NewTimerFactoryImpl(pe.manager))
+		pe.manager.SetReceiver(pe.pbft)
+		pe.pbft.N = 4
+		pe.pbft.f = (4 - 1) / 3
+		pe.pbft.requestTimeout = 200 * time.Millisecond
+
+		expected := uint64(8)
+		if pe.pbft.h != expected {
+			t.Errorf("Low watermark should have been %d, got %d", expected, pe.pbft.h)
+		}
+	}
+
+}
 func TestReplicaPersistQSet(t *testing.T) {
 	persist := make(map[string][]byte)
 
diff --git a/consensus/pbft/pbft-persist.go b/consensus/pbft/pbft-persist.go
index 52e0f6dfbcd..a5b672ea26d 100644
--- a/consensus/pbft/pbft-persist.go
+++ b/consensus/pbft/pbft-persist.go
@@ -148,9 +148,11 @@ func (instance *pbftCore) restoreState() {
 		logger.Warningf("Replica %d could not restore reqBatchStore: %s", instance.id, err)
 	}
 
+	instance.restoreLastSeqNo()
+
 	chkpts, err := instance.consumer.ReadStateSet("chkpt.")
 	if err == nil {
-		highSeq := uint64(0)
+		lowWatermark := instance.lastExec // This is safe because we will round down in moveWatermarks
 		for key, id := range chkpts {
 			var seqNo uint64
 			if _, err = fmt.Sscanf(key, "chkpt.%d", &seqNo); err != nil {
@@ -159,20 +161,18 @@ func (instance *pbftCore) restoreState() {
 				idAsString := base64.StdEncoding.EncodeToString(id)
 				logger.Debugf("Replica %d found checkpoint %s for seqNo %d", instance.id, idAsString, seqNo)
 				instance.chkpts[seqNo] = idAsString
-				if seqNo > highSeq {
-					highSeq = seqNo
+				if seqNo < lowWatermark {
+					lowWatermark = seqNo
 				}
 			}
 		}
-		instance.moveWatermarks(highSeq)
+		instance.moveWatermarks(lowWatermark)
 	} else {
 		logger.Warningf("Replica %d could not restore checkpoints: %s", instance.id, err)
 	}
 
-	instance.restoreLastSeqNo()
-
-	logger.Infof("Replica %d restored state: view: %d, seqNo: %d, pset: %d, qset: %d, reqBatches: %d, chkpts: %d",
-		instance.id, instance.view, instance.seqNo, len(instance.pset), len(instance.qset), len(instance.reqBatchStore), len(instance.chkpts))
+	logger.Infof("Replica %d restored state: view: %d, seqNo: %d, pset: %d, qset: %d, reqBatches: %d, chkpts: %d h: %d",
+		instance.id, instance.view, instance.seqNo, len(instance.pset), len(instance.qset), len(instance.reqBatchStore), len(instance.chkpts), instance.h)
 }
 
 func (instance *pbftCore) restoreLastSeqNo() {