U.S. SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, DC 20549
                               FORM 10-QSB
     
              Quarterly Report Under Section 13 or 15(d)
                of the Securities Exchange Act of 1934
     
     For the Quarter Ended March 31, 1999
     
     Commission file number 0-16819
     
                      National Capital Management Corporation               
              (Exact name of registrant as specified in its charter)
     
           Delaware                                  94-3054267              
     (State or other jurisdiction of    (I.R.S.Employer Identification Number)
     incorporation or organization)
     
     520 Madison Avenue    New York          NY         10022                 
     (Address of principal executive offices)         (Zip Code)
     Registrant's telephone number, including area code   (212) 980-3883      
     Former name, former address and former fiscal year, if changed from last
     report
                                                                              
     
     Check whether the issuer (1) filed all reports required to be filed by
     Section 13 or 15(d) of the Securities Exchange Act during the past 12
     months (or for such shorter period that the registrant was required to
     file such reports), and (2) has been subject to such filing requirements
     for the past 90 days.
     
                     Yes      X           No ___________
      
     Number of common shares outstanding as of March 31, 1999:
     
           Common stock, $0.01 par value, 1,673,190  shares
<PAGE>
                  NATIONAL CAPITAL MANAGEMENT CORPORATION
                       FORM 10-QSB QUARTERLY REPORT
                             MARCH 31, 1999
     
     
     
                           TABLE OF CONTENTS
     
     
     
                                                                  PAGE     
     
                    PART I.  FINANCIAL INFORMATION
     
     Consolidated Balance Sheets as of March 31, 1999
      (unaudited) and December 31, 1998                            3
     Consolidated Statements of Operations for the three
      months ended March 31, 1999 and 1998 (unaudited)             4
     Consolidated Statements of Cash Flows for the three
      months ended March 31, 1999 and 1998 (unaudited)             5
     Notes to Consolidated Financial Statements                 6-11
     
     ITEM II. Management's Discussion and Analysis of
                Financial Condition and
                Results of Operations                          12-14
     
                      PART II - OTHER INFORMATION
     
     Item 1.  Legal Proceedings                                   15
     Item 2.  Changes in Securities                               15
     Item 3.  Defaults Upon Senior Securities                     15
     Item 4.  Submission of Matters to a Vote of
              Security Holders                                    15
     Item 5.  Other Information                                   15
     Item 6.  Exhibits and Reports on Form 8-K                    15
              Signatures                                          16

                                        -2-
<PAGE>     
                  NATIONAL CAPITAL MANAGEMENT CORPORATION
                        CONSOLIDATED BALANCE SHEETS
                   MARCH 31, 1999 AND DECEMBER 31, 1998
<TABLE>
                                                   March 31,   December 31,
                                                    1999         1998    
         ASSETS                                  (Unaudited)    (Audited) 
     <S>                                           <C>         <C>
                                                                    
     Cash and cash equivalents                     $1,931,982  $2,058,674
     Other receivable                                  75,000      75,000
     Accounts receivable                                3,854       3,711
     Property and equipment, less accumulated
      depreciation of $82,908 and $80,718 at
      March 31, 1999 and December 31, 1998,
      respectively                                     21,923      24,113
     Net assets of discontinued operations -
      Real Estate Segment                              11,027      11,426
      Viatical Settlements Segment                          1      -     
     Other assets                                      37,746      39,960
     
     Total assets                                  $2,081,533  $2,212,884
</TABLE>

<TABLE>
          LIABILITIES AND SHAREHOLDERS' EQUITY

     <S>                                           <C>         <C>
     Net liabilities of discontinued operations -
       Viatical Settlements Segment                $   -       $  493,015
     Accrued liabilities                               49,602      71,007
     
     Total current liabilities                         49,602     564,022
     
     Shareholders' equity:
      Preferred stock, $0.01 par value,
        3,000,000 shares authorized, no shares
        issued and outstanding                         -           -     
      Common stock, $0.01 par value, 6,666,666
        shares authorized, 1,813,056 shares
        issued, 1,673,190 outstanding                  16,732      16,732
      Additional paid-in capital                   23,618,139  23,125,123
      Accumulated deficit                         (21,428,723)(21,318,776)
      Treasury stock, 139,866 shares at
        March 31, 1999 and
        December 31, 1998                            (174,217)   (174,217)
     
     Total shareholders' equity                     2,031,931   1,648,862
     
     Total liabilities and shareholders' equity    $2,081,533  $2,212,884
</TABLE>
     
See Accompanying Notes to Financial Statement.
                                        -3-
<PAGE>
                  NATIONAL CAPITAL MANAGEMENT CORPORATION
                   CONSOLIDATED STATEMENTS OF OPERATIONS
            FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND 1998
<TABLE>
     
                                                        1999        1998    
                                                     (Unaudited) (Unaudited)
     <S>                                              <C>        <C>
     Income (expense):
      Other income                                    $  16,692  $  10,893
      Corporate administrative expense                 (122,490)  (137,439)
     
     Net loss from continuing operations before tax    (105,798)  (126,546)
     
     Provision for income taxes                           -          -    
     
     Net loss from continuing operations after tax     (105,798)  (126,546)
     
     Discontinued operations:                                  
      Net operating income (loss):                             
         Viatical settlements (Note 2)                   (3,750)    -   
         Real estate segment (Note 3)                      (399)    12,959
                                                          
     Net income (loss) from discontinued operations      (4,149)    12,959
     
     Net loss                                         $(109,947) $(113,587)
      
     Net loss from continuing operations per share        $(.06)     $(.08)
     
     Net income (loss) from discontinued
      operations per share                                 (.01)       .01
     
     Net loss per share                                   $(.07)     $(.07)
     
     Average number of shares outstanding             1,673,190  1,673,190
</TABLE>
     
     See Accompanying Notes to Financial Statements.
                                        -4-
<PAGE>     
                  NATIONAL CAPITAL MANAGEMENT CORPORATION
                   CONSOLIDATED STATEMENTS OF CASH FLOWS
             FOR THE THREE MONTHS ENDED MARCH 31, 1999 AND 1998
<TABLE>
     
                                                      1999         1998    
                                                   (Unaudited)  (Unaudited) 
     <S>                                           <C>          <C>
     Cash flows from operating activities:         
      Net loss                                     $ (109,947)  $(113,587)
      Adjustments to reconcile net loss to
        net cash used in operating activities:
               Depreciation                             2,190       2,190
      Changes in operating assets and liabilities:
          Increase in accounts receivable                (143)       -   
          Increase (decrease) in accounts
            payable and accrued liabilities           (21,405)     85,212
          Decrease in other assets                      2,214        -   
     
     Net cash used in operating activities           (127,091)    (26,185)
                                                                                                                                    
     Change in net assets of discontinued
      operations                                          399       2,051
     
     Decrease in cash and cash equivalents           (126,692)    (24,134)
      
     Cash and cash equivalents at beginning
      of period                                     2,058,674      56,035
     
     Cash and cash equivalents at end of period    $1,931,982   $  31,901
     
     Supplemental information:
     
      Interest paid                                  $122,004    $269,131
</TABLE>

     See Accompanying Notes to Financial Statements.
                                  -5-
<PAGE>
                       NATIONAL CAPITAL MANAGEMENT CORPORATION
                     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             MARCH 31, 1999 AND 1998
                                  (Unaudited)
     
     
     NOTE 1 - THE COMPANY AND BASIS OF PRESENTATION
     
     The financial information for the three month period ended March 31, 1999
     and 1998 presented in this Form 10-QSB has been prepared from the
     accounting records without audit.  The information furnished reflects all
     adjustments (consisting of only normal recurring adjustments) which are,
     in the opinion of management, necessary for a fair statement of the
     results of interim periods.  The results of operations for the three
     months ended March 31, 1999 are not necessarily indicative of the results
     to be expected for a full year.  The consolidated balance sheet as of
     December 31, 1998 has been derived from audited financial statements. 
     This report should be read in conjunction with the consolidated financial
     statements included in the Company's December 31, 1998 Annual Report to
     shareholders on Form 10-KSB as filed with the Securities and Exchange
     Commission.
     
     National Capital Management Corporation ("NCMC" or the "Company") is a
     holding company that currently is completing the orderly liquidation of
     its discontinued operations, while seeking other acquisitions.
     
     Prior to 1995, the Company had been comprised of three distinctly
     different operating businesses, the Viatical Settlements Segment, which
     was operated through National Capital Benefits Corporation ("NCBC"), a
     wholly owned subsidiary, the Real Estate Segment and the Industrial
     Products Segment.  The Industrial Products Segment and Real Estate Segment
     were discontinued in 1995.  The Viatical Settlement Segment was
     discontinued in 1996.
     
     Consolidation Principles
     
     The consolidated financial statements include the accounts of the Company
     and all of its majority-owned subsidiaries.  All significant intercompany
     accounts and transactions have been eliminated in consolidation.
     
     Earnings per share
     
     Effective December 15, 1997, the Financial Accounting Standards Board
     issued Statement No. 128, "Earnings per Share".  Statement No. 128
     replaced the previously reported primary and fully diluted earnings per
     share with basic and diluted earnings per share.  Under the new
     requirements for calculating earnings per share, the dilutive effect of
     stock options will be excluded from basic earnings per share but included
     in the computation of diluted earnings per share.  All earnings per share
     amounts have been restated so as to comply with Statement No. 128.
     
     NOTE 2 - DISCONTINUED OPERATIONS - VIATICAL SETTLEMENTS SEGMENT
     The results of the Viatical Settlements Segment have been reported
     separately as discontinued operations in these consolidated statements of
     operations.
     
                                        -6-
     <PAGE>
     NOTE 2 - DISCONTINUED OPERATIONS - VIATICAL SETTLEMENTS SEGMENT          
              (CONTINUED)
     
     In December 1996, the Company decided to discontinue the operations of the
     Viatical Settlements Segment.  The Company reduced its staff and expects
     that the remaining personnel will administer the orderly liquidation of
     its existing portfolio.  It is expected that this process will take
     several more years.  The Company established a $1,500,000 valuation
     reserve during 1996, and as adjusted during the quarter ended March 31,
     1999, against accrued policy revenues and purchased policy costs which
     represents the estimated expected loss on holding the remaining policies
     to maturity in order to reflect management's estimate of the fair market
     value of the net assets.  During the fourth quarter ended December 31,
     1997, the Company increased its original reserve by $350,000.  In
     addition, management reevaluated the expected costs of operations and
     accordingly increased the reserve by $522,000 as of December 31, 1998. 
     The amount of the reserve was determined based on projections of expected
     cash inflows from maturities and reinsurance claims, and cash outflows for
     debt service and operating costs during the portfolio administration
     process, which is expected to take several more years.
     
     Because the Company is under no obligation to fund the liability
     associated with the cost of operations of the Viatical Settlements
     Segment, the liability of the discontinued operation at December 31, 1998
     has been reclassified to additional paid-in-capital and the value of the
     Viatical Settlements Segment as of March 31, 1999 is $1.
     
     NCBC has an insurance contract with NCB Insurance Ltd. ("NCB"), a wholly-
     owned subsidiary of NCBC, which automatically provides for payment of 90%
     of the face value of the policies purchased at a specified period of time
     after the expected maturity date, in accordance with the contract.  NCB,
     in turn, has reinsured this risk with several large, non-affiliated
     international reinsurance companies.  NCBC, through NCB, maintains a
     participation in the residual 10%.
     
     The anticipated reinsurance recoveries represent a substantial element of
     the cash flow projections used to determine the valuation reserve.  While
     management expects full collection of reinsurance recoveries, these
     recoveries from the sole reinsurance facility represent a significant
     concentration of risk.
     
     Summarized below are the operations of the Company's Viatical Settlements
     Segment for the three months ended March 31, 1999 and 1998:
<TABLE>
                                                      1999          1998   
                                                   (Unaudited)  (Unaudited)
     <S>                                             <C>       <C> 
     Revenue accrued and received                    $471,304  $1,033,738
     Cost of insurance policies                      (356,881)   (756,843)
     Valuation reserve income                          94,088      92,205
     Earned discount                                  208,511     369,100
     Interest expense                                (140,000)   (308,374)
     Earned discount after interest expense            68,511      60,726
     General and administrative expenses               71,937      60,453
     Depreciation and amortization                        324         273

     Net loss                                        $ (3,750) $    -    
</TABLE>
                                        -7-
<PAGE>     
     NOTE 2 - DISCONTINUED OPERATIONS - VIATICAL SETTLEMENTS SEGMENT
              (CONTINUED)
     
     The components of the Viatical Settlements Segment net assets
     (liabilities) from discontinued operations in the consolidated balance
     sheets as of March 31, 1999 and December 31, 1998 are as follows:
<TABLE>
     
                                                 March 31,    December 31,
                                                   1999           1998    
                                                (Unaudited)    (Audited)
     <S>                                        <C>            <C>
     Purchased policy costs, less amortized
       policy costs of $21,025,066 and
       $20,668,126, respectively                 $ 1,226,367   $ 1,583,337
     Valuation reserve                              (572,891)     (666,899)
     Accrued policy revenues, less matured
       revenues valuation of $9,949,269 and
       $9,586,769, respectively                   15,124,774    15,266,332
     Revolving credit facility                    (2,380,791)   (3,660,216)
     Subordinated note payable                    (2,000,000)   (2,000,000)
     Reinsurance liability                       (11,377,619)  (10,522,723)
     Other, net                                      (19,839)     (492,846)
     
                                                 $         1   $  (493,015)
</TABLE>
     NOTE 3 - DISCONTINUED OPERATIONS - REAL ESTATE SEGMENT
     
     On November 27, 1995, the Company elected to discontinue operations of the
     Real Estate Segment to concentrate its efforts on its Viatical Settlements
     Segment.  The following is a description of the Company's recent disposal
     activity:
     
     Colony Ridge Apartments
     
     Colony Ridge Apartments was an apartment complex in Decatur, Georgia which
     was constructed in 1968 and consisted of 23 two-story buildings containing
     a total of 212 apartment units.  On May 6, 1998, the Company sold the
     Colony Ridge Apartments for $3,650,000.  The Company received net proceeds
     of approximately $2,500,000.  The difference between the sales price and
     the net proceeds received was due to the repayment of the mortgage, state
     taxes, and miscellaneous expenses.  The Company reported a gain, net of
     income taxes, of $695,270 during 1998.
     
     Redbird Trails Apartments and North Oak Apartments:  On June 13, 1994 and
     December 8, 1994, in accordance with previous agreements dated December
     30, 1993, the Company sold limited partnership interests in Redbird Trails
     Associates, L.P. ("Redbird") and Signature Midwest, L.P. ("Signature"),
     respectively, to two unrelated entities.  The Company retained a .9%
     interest in each partnership through two wholly-owned subsidiaries serving
     as the operating general partners.  Such operating general partners were
     obligated to provide loans of up to $150,000 and $75,000 to Redbird and
     Signature, respectively, to fund any operating deficits, as defined, for
     a three year period ending December 8, 1997.  No loans were made during
     1997.
                                        -8-
<PAGE>
     NOTE 3 - DISCONTINUED OPERATIONS - REAL ESTATE SEGMENT (CONTINUED)
     
     The Company retained a contingent interest in the cash flows of these
     partnerships.  It  is entitled to receive any cash available from property
     operations, to the extent it exceeds approximately $61,000 annually, and
     any refinancing proceeds up to a total of approximately $4.5 million, plus
     interest at 9.25% per annum on the outstanding balance of this amount. 
     Any proceeds of sale are to be allocated, first, 99.1% to the new partners
     until they have received 135% of their investment, less any prior
     distributions.  Any remaining proceeds from a sale are to be allocated to
     the Company up to $6 million, less any distributions from operations or
     refinancings as described above.  These commitments have not been
     reflected in the Company's financial statements since their ultimate
     realization cannot reasonably be determined.  In addition, at such time as
     any tax benefits have been utilized, the Company has the right to purchase
     the interests of the newly admitted partners for 135% of their contributed
     capital (minus prior cash payments).  Should the Company choose not to
     exercise such right to purchase the partners' interests, the newly
     admitted administrative general partner has the right to require the
     Company to sell all of the assets and liquidate the partnerships.  The
     Company did not fund any operating deficits and has not received any
     excess cash flows for the three months ended March 31, 1999 and 1998.  The
     Company is entitled to a 2% management fee from the partnerships.  For the
     three month period ended March 31, 1999 and 1998 the Company received
     management fees of approximately $7,700 and $11,000, respectively.
     
     The Company is presently in negotiations with NCM Management Ltd., the
     real estate company currently providing management services to these
     properties, to sell its residual interest in such properties, including
     the right to receive the aforementioned management fee, for a fee of
     $335,000.  Negotiations are preliminary, however, and the Company makes no
     assurances that this transaction will be consummated.
     
     The results of the Real Estate Segment have been reported separately as
     discontinued operations in these consolidated statements of operations.  
     
     Summarized below are the operations of the Company s Real Estate Segment
     for the three months ended March 31, 1999 and 1998:
<TABLE>
                                                        1999        1998   
                                                    (Unaudited)  (Unaudited)
     <S>                                               <C>       <C>
     Total revenues                                    $  -      $279,588
     
     Costs and expenses:
       Operations and maintenance                         -       147,432
       Property taxes and insurance                       -        20,042
       Depreciation and amortization                      -        75,000
       Net interest                                       -        24,155
       Corporate administrative expense                    399      -    
     
     Total costs and expenses                              399    266,629
     
     Net income (loss)                                 $  (399)  $ 12,959
</TABLE>
                                        -9-
<PAGE>
     
     NOTE 3 - DISCONTINUED OPERATIONS - REAL ESTATE SEGMENT (CONTINUED)
     
     The components of the Real Estate Segment net assets from discontinued
     operations in the consolidated balance sheets as of March 31, 1999 and
     December 31, 1998 are as follows:
<TABLE>
                                                  March 31,     December 31,
                                                   1999             1998    
                                                (Unaudited)      (Audited)
      <S>                                         <C>              <C>     
      Cash                                        $11,027          $11,426
</TABLE>
     
     NOTE 4 - DISCONTINUED OPERATIONS - INDUSTRIAL PRODUCTS SEGMENT
     
     The Industrial Products Segment was discontinued during 1995.  It
     consisted of the Company's wholly-owned subsidiary, Jensen Corporation
     ("Jensen"), which manufactured and distributed machinery used primarily by
     commercial laundries, large institutions and hotels as well as commercial
     compactor products for waste disposal.  On November 10, 1995, the Company
     sold 100% of the common stock of Jensen, located in Fort Lauderdale,
     Florida to AMKO USA, Inc. ("AMKO"), an affiliate of AMKO International
     B.V. which is based in The Netherlands, for $1,726,000.  The sale proceeds
     included cash of $415,000 and a promissory note receivable in the amount
     of $1,311,000 which was secured by Jensen's stock, accounts receivable and
     inventory.  The $1,311,000 note was guaranteed in its entirety by AMKO
     International B.V., and the sole shareholder of AMKO International B.V.
     guaranteed, as amended May 16, 1997, $500,000 of payments, of all notes. 
     
     AMKO also agreed to cause Jensen to pay to the Company a $765,000
     obligation in the form of a note,  which was loaned to Jensen, $500,000 of
     which was prior to the sale and $265,000 which was simultaneous with the
     sale, and an intercompany balance payable by Jensen to the Company of
     $337,650, which was secured by the assets of Jensen.  These notes were
     guaranteed by AMKO International B.V.
     
     The $1,311,000 note, as amended May 16, 1997, bore interest at 8.5% per
     annum and was payable in varying installments with the balance due in
     April 1998 unless extended as indicated below.  The $765,000 note, as
     amended May 16, 1997, bore interest at 8.5% per annum and was payable in
     varying installments with the balance due in April 1998 unless extended as
     indicated below.  The $337,650 note, as amended May 16, 1997, bore
     interest at 8.5% per annum and was payable in varying installments with
     the balance due in April 1998 unless extended as indicated below.
     
     The Company advanced $198,000 to AMKO during February and March 1997, of
     which $82,500 was repaid.  The balance was a Demand Note which bore
     interest at 12% per annum.  This note was also guaranteed by AMKO
     International.  As of December 31, 1997, this note was paid in full.
     
     In accordance with the May 16, 1997 amendment, the notes could be extended
     until April 1999, if AMKO prepaid $500,000 on or before April 1, 1998.  If
     extended, the interest rate on all of the notes would increase to 12%. 
     The Company charged AMKO a fee of $200,000 in  conjunction with the
     amendment.  The fee was paid on May 16, 1997. 
     
     The Company loaned Jensen an additional $200,000 in conjunction with the
     May 16, 1997 modification and an additional $36,000 in October 1997. 
     These notes bore interest at 8.5% and mature simultaneously with the other
     notes.
                                       -10-
<PAGE>
     NOTE 4 - DISCONTINUED OPERATIONS - INDUSTRIAL PRODUCTS SEGMENT (CONTINUED)
     
     As of October 1997, Jensen stopped making payments as required by the
     terms of the May 16, 1997 amendment.  On November 11, 1997, Jensen filed
     for Chapter 7 bankruptcy.  On March 26, 1998, an auction sale was held,
     the proceeds of which are either to be distributed pursuant to an
     evidentiary hearing or a prior court approved agreement with the trustee.
     
     In March 1999, a settlement was reached with the trustee, in which a
     payment of $75,000 would be made to NCMC, as a result of the sale of
     Jensen's inventory, in exchange for which NCMC would assert no further
     claims against the debtor.  This payment was received in May 1999.
     
     As a result of the bankruptcy filing, the Company reduced the value of its
     notes receivable to $150,000 as of December 31, 1997.  The Company
     received approximately $73,000 during 1998 and the remaining balance was
     written off as of December 31, 1998.
     
     AMKO International filed for and was discharged from the bankruptcy in the
     Netherlands between January and April 1998.
     
     The Company has pursued a remedy in judicial proceedings in the
     Netherlands with a procedural result that would allow the Company to
     pursue AMKO International in the United States courts.  As of February
     1999, the Company released both AMKO International and its successor in
     interest from any claims.  In addition, the Company and FNM Bank (a
     Netherlands bank) agreed to settle all lender liability claims.  As a
     result of the foregoing, the Company is free to pursue the former owner of
     AMKO International on his personal guarantee, and will allocate any
     proceeds received on the basis of 75% to the Company and 25% to FNM
     Holding, N.V., after all expenses have been paid.  The Company cannot
     predict the outcome of this litigation.
     
     NOTE 5 - CONCENTRATION OF RISK
     
     The Company has bank balances in excess of the $100,000 of depository
     insurance provided by the Federal Deposit Insurance Corporation.
                                       -11-
<PAGE>
     
                   NATIONAL CAPITAL MANAGEMENT CORPORATION
                    MANAGEMENT'S DISCUSSION AND ANALYSIS
              OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
     
     ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
              RESULTS OF OPERATIONS:
     
     Overview
     
     The following is a discussion and analysis of the consolidated financial
     condition of the Company as of March 31, 1999 and of the results of
     operations for the Company for the three months ended March 31, 1999 and
     1998, and of certain factors that may affect the Company's prospective
     financial condition and results of operations.  The following is
     supplemental to and should be read in conjunction with the Company's
     December 31, 1998 Annual Report to shareholders on Form 10-KSB as filed
     with the Securities and Exchange Commission, and the financial information
     and accompanying notes beginning on page 3 of this report.
     
     Information contained in this discussion and analysis contains "forward-
     looking statements" within the meaning of the Private Securities
     Litigation Reform Act of 1995, which can be identified by the use of
     forward-looking terminology such as "may", "will", "expect", "plan",
     "anticipate", "estimate" or "continue" or the negative thereof or other
     variations thereon or comparable terminology.  There are certain important
     factors that could cause results to differ materially from those
     anticipated by some of these forward-looking statements.  Investors are
     cautioned that all forward-looking statements involve risks and
     uncertainty.  The factors, among others, that could cause actual results
     to differ materially include: cures and advances in medical treatments for
     terminal illnesses; dependence on medical consultants and an ability to
     predict life expectancy; the Company's ability to execute its business
     plan, and the ability to collect reinsurance recoveries from a single
     reinsurance facility. 
     
     The preparation of financial statements in conformity with generally
     accepted accounting principles requires the Company to make estimates and
     assumptions that affect the reported amounts of assets and liabilities and
     disclosure of contingent assets and liabilities at the date of the
     financial statements and the reported amounts of revenue and expenses
     during the reporting period.  Actual results could differ significantly
     from those estimates.
     
     Material estimates that are particularly susceptible to significant change
     in the near term relate to the determination of the valuation reserve
     against accrued policy revenues and the cost of purchased policies and the
     collectibility of notes receivable. 
     
     The Company is managing the administration of the collection of the
     portfolio of life insurance policies, it has completed the orderly
     liquidation of its remaining real estate, and continues to pursue
     collection of its receivables. Management intends to seek other
     acquisitions.
                                        -12-
<PAGE>
     Accounting for long-lived assets
     
     For the three months ended March 31, 1999 and calendar year December 31,
     1998, the Company has applied SFAS 121, "Accounting for the Impairment of
     Long-Lived Assets and for Long-Lived Assets to Be Disposed Of", and
     determined that certain adjustments for impairment were required.  In
     addition to the write-down of several assets of the Company, a $1.5
     million valuation reserve was established during 1996 against accrued
     policy revenues and purchased policy costs in order to reflect
     management's estimate of the fair market value of the net assets.  During
     the fourth quarter ended December 31, 1997 and 1998, the Company increased
     its original reserve by $350,000 and $522,000, respectively (Note 2).
     
     The accuracy of the valuation reserve established by the Company (Note 2)
     is directly related to NCBC's assumptions regarding the remaining life
     expectancy of terminally ill individuals.  While NCBC believes that its
     estimate of life expectancy, and the related valuation reserve will
     approximate actual experience, given the inherent scientific uncertainty
     of such estimates, including the potential impact of recently announced
     medical treatments that might extend life expectancies, there can be no
     assurance that these policies will mature in accordance with management's
     estimates.  Therefore, the Company established a $1,500,000 valuation
     reserve against accrued policy revenues and purchase policy costs during
     1996, which is adjusted quarterly.  During the fourth quarter ended
     December 31, 1997, the Company increased its original reserve by $350,000. 
     In addition, management reevaluated the expected costs of operations and
     accordingly increased the reserve by $522,000 as of December 31, 1998. 
     The amount of the reserve was determined based on projections of expected
     cash inflows from maturity and reinsurance claims, and cash outflows for
     debt service and operating costs during the portfolio administration
     process which is expected to take several more years (Note 2).
     
     Financial condition and liquidity
     
     The Company's cash decreased from $2,058,674 as of December 31, 1998 to 
     $1,931,982 at March 31, 1999, principally as a result of financing
     operating activities.
     
     Other than in its Viatical Settlements Segment, the Company does not have
     any existing general credit facilities to fund its ongoing working capital
     requirements.  These lending facilities were amended in 1997 in  light of
     management's decision to discontinue the Viatical Settlements Segment and
     liquidate the portfolio.
     
     Results of operations
     
     As a result of the Company's decision to discontinue its Viatical
     Settlements Segment in December 1996, the Company ceased purchasing
     insurance policies from individuals.  The Company may, however, seek the
     purchase of a portfolio of life insurance policies to the extent each of
     the policies in such a bulk purchase is within the guidelines set forth in
     the reinsurance agreements with NCBC.  As previously announced, NCBC has
     restructured its organization and reduced its office staff to one person. 
     Management anticipates that this remaining person, as well as NCMC
     management, will manage NCBC's existing portfolio of approximately $17 
     million of insurance policies.  Management estimates that the
     administration of these policies will take several more years.
     
     During the three months ended March 31, 1999, approximately $362,500 of
     life insurance policies matured as compared to $137,500 for the same
     period last year.
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<PAGE>
     The recognition of earned discount and the ultimate profitability
     associated with purchased insurance policies is directly related to NCBC's
     assumptions regarding the remaining life expectancy of terminally ill
     individuals.  Such estimates were made when the insurance policy was
     purchased based upon facts and circumstances then known. While NCBC
     believes that its estimate of life expectancy, and the related recognition
     of earned discount will closely approximate actual experience, given the
     inherent scientific uncertainty of such estimates, including the potential
     impact of recently announced medical treatments that might extend life
     expectancies, there can be no assurance that these policies will mature in
     accordance with management's estimates. Therefore, the Company established
     a $1,500,000 valuation reserve against accrued policy revenues and
     purchase policy costs during 1996, and as adjusted during the three months
     ended March 31, 1999.  During the fourth quarter ended December 31, 1997
     and 1998, the Company increased its original reserve by $350,000 and
     $522,000, respectively.  The amount of the reserve was determined based on
     projections of expected cash inflows from maturity and reinsurance claims,
     and cash outflows for debt service and operating costs during the
     portfolio administration process which is expected to take several more
     years (Note 2).
     
     On May 6, 1998, the Company sold the Colony Ridge Apartments for
     $3,650,000.  The Company received net proceeds of approximately
     $2,500,000.  The difference between the sales price and the net proceeds
     received was due to the repayment of the mortgage, state taxes, and
     miscellaneous expenses.  The Company reported a gain, net of income taxes, 
     of $695,270 during 1998.
     
     YEAR 2000
     
     The Year 2000 problem is the result of computer programs being written
     with two digits instead of four digits to define the applicable year.  The
     Company believes based upon its internal reviews and other factors, that
     future external and internal costs to be incurred relating to the
     modification of internal-use software for the Year 2000 will not have a
     material adverse effect on the Company's results of operations or
     financial position.  The Company, due to the fact that it is in the
     process of orderly liquidating its discontinued operations, only makes
     minimal use of computers in operating its business.  In addition, the
     Company believes that its internal computer systems, facilities and
     equipment will be upgraded, where required, for Year 2000.  However, there
     is no assurance that all of the upgrades will be completed in time or
     function as intended.  In such an event, the Company may experience
     significant disruptions, the cost of which the Company is unable to
     estimate at this time.  The Company, also, cannot assure that its failure
     or failure of third parties to address adequately Year 2000 issues will
     not have a material effect on the Company.

                                        -14-
<PAGE>

                           PART II - OTHER INFORMATION
     
     
     ITEM 1. LEGAL PROCEEDINGS
             Not applicable
     
     ITEM 2. CHANGES IN SECURITIES
             Not applicable
     
     ITEM 3. DEFAULTS UPON SENIOR SECURITIES
             Not applicable
     
    ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
             Not applicable
     
    ITEM 5.  OTHER INFORMATION
            
    ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K
             Not applicable

                                        -15-
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                                      SIGNATURES
     
     Pursuant to the requirements of the Securities Exchange Act of 1934, the
     registrant has duly caused this report to be signed on its behalf by the
     undersigned thereunto duly authorized.
     
                                      NATIONAL CAPITAL
                                      MANAGEMENT CORPORATION
     
     
     
     
     Dated:                           By:           //s// John C. Shaw
                                           John C. Shaw
                                           Chief Executive Officer
     
                                                                    
     
     
     
     
     
     
     
     
     
     
                                      
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
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