March 30, 1999

Mr. Jonathan G. Katz

Secretary, Securities Exchange Commission

Mail Stop 6-9

450 Fifth Street, NW

Washington, DC 20549

Dear Mr. Katz:

This letter is sent in response to File No. S7-5-99 relative to the proposed rule amendments at the Securities Exchange Commission (SEC) that will have a disastrous impact on both the liquidity and the value of our company's stock if it passes. These amendments to Rule 15c2-11 would require market makers in OTC Bulletin Board@ and Pink Sheets@ stocks to learn about the stocks they trade, study the companies' financial statements and keep an eye out for fraud.

These proposed amendments presents an impossible and very costly task for companies serving as market makers for small companies such as ours. Mechanics and Farmers Bank has issued and outstanding 569,220 shares of common stock. Our stock is closely held and not widely traded. If market makers are required to monitor us to the extent indicated in the proposed amendments they would most likely discontinue to make a market for our stock and therefore limit the marketability of the stock. The end results would be little if any liquidity for our shareholders and the Bank.

Please reconsider these proposals and the impact that reality would have on small institutions such as Mechanics and Farmers Bank. In theory, it sounds good. However, the reality of it all is that the small institutions will suffer financially or through the lack of market availability of shares of stock. We cannot afford to pay the fees that will be assessed by the various companies to make a market for our stock should these amendments pass. History has taught us that too much government controls result in excessive cost to the user of services. The only way for companies to provide a service that impact their bottom line is to pass the cost on to the user "our Bank".

Thank you for your consideration in this matter and our request to set a side these amendments.


Lee Johnson, Jr.

Executive Vice President/CFO

Financial Group Executive