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, 1998
     
     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) has filed all reports required to be filed by
     Section 13 or 15(d) of the Securities Exchange Act of 1934 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, 1998:
     
         Common stock, $0.01 par value, 1,673,190 shares
<PAGE>     
                  NATIONAL CAPITAL MANAGEMENT CORPORATION
                     FORM 10-QSB QUARTERLY REPORT
                            MARCH 31, 1998
     
     
     
                           TABLE OF CONTENTS
                                                               PAGE   
                                                               ----
                       PART I.  FINANCIAL INFORMATION
     
     Consolidated Balance Sheets as of March 31, 1998
       (unaudited) and December 31, 1997                          3
     Consolidated Statements of Operations for the three
       months ended March 31, 1998 and 1997 (unaudited)           4
     Consolidated Statements of Cash Flows for the three
       months ended March 31, 1998 and 1997 (unaudited)           5
     Notes to Consolidated Financial Statements(unaudited)      6-9
     
     ITEM II. Management's Discussion and Analysis of
                Financial Condition and
                Results of Operations                         10-12
     
                      PART II - OTHER INFORMATION
     
     Item 1.  Legal Proceedings                                  13
     Item 2.  Changes in Securities                              13
     Item 3.  Defaults Upon Senior Securities                    13
     Item 4.  Submission of Matters to a Vote of
                Security Holders                                 13
     Item 5.  Other Information                                  13
     Item 6.  Exhibits and Reports on Form 8-K                   13
              Signatures                                         14

     
                                      -2-
<PAGE>     
<TABLE>
                 NATIONAL CAPITAL MANAGEMENT CORPORATION
                       CONSOLIDATED BALANCE SHEETS
                  MARCH 31, 1998 AND DECEMBER 31, 1997
<CAPTION>     
        
                                                   March 31,    December 31,
                                                     1998           1997    
                                                   ----------   ------------
         ASSETS                                    (Unaudited)     (Audited)    
         ------
   <S>                                             <C>           <C>
   Cash and cash equivalents                       $    31,901   $    56,035
   Notes receivable                                    150,000       150,000
   Property and equipment, less accumulated            
     depreciation of $74,148 and $71,958 at
     March 31, 1998 and December 31, 1997,
     respectively                                       30,683        32,873
   Net assets of discontinued operations -
     Real Estate Segment                             1,782,988     1,795,030
     Viatical Settlements Segment                       35,519        25,528
   Other assets                                         36,225        36,225
                                                   -----------   -----------
   Total assets                                    $ 2,067,316   $ 2,095,691
                                                   ===========   ===========  
</TABLE>
         LIABILITIES AND SHAREHOLDERS' EQUITY
         ------------------------------------
<TABLE>
  <S>                                              <C>            <C>
   Accounts payable and accrued expenses           $   188,511    $  103,299
     
   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                     23,125,123     23,125,123
     Accumulated deficit                           (21,088,833)   (20,975,246)
     Treasury stock, 139,866 shares at
       March 31, 1998 and December 31, 1997           (174,217)      (174,217)
                                                   -----------   ------------
 
   Total shareholders' equity                        1,878,805      1,992,392
                                                    -----------   -----------
   Total liabilities and shareholders' equity       $ 2,067,316   $ 2,095,691
                                                    ===========   ===========

See Accompanying Notes to Financial Statements.

                                    -3-
</TABLE>
<PAGE>
<TABLE>
                   NATIONAL CAPITAL MANAGEMENT CORPORATION
                    CONSOLIDATED STATEMENTS OF OPERATIONS
             FOR THE THREE MONTHS ENDED MARCH 31, 1998 AND 1997
<CAPTION>
                                                    For the Three Months
                                                            Ended
                                                         March 31,
                                                       1998       1997
                                                    ---------   ----------  
                                                   (Unaudited)  (Unaudited)
   <S>                                             <C>          <C>        
   Income (expense):
     Other income                                  $   10,893    $   63,850
     Corporate administrative expense                (137,439)     (376,702)
     
   Net loss from continuing operations
     before tax                                       (126,546)    (312,852)
     
    Provision for income taxes                          -             -    
                                                   -----------   ----------
   Net loss from continuing operations
     after tax                                        (126,546)    (312,852)
                                                   -----------   ----------  
   Discontinued operations:
     Net operating income (loss):
       Viatical settlements (Note 2)                    -           (37,996)
       Real estate segment (Note 3)                    12,959       (22,549)
                                                   ----------     --------- 
 
  Net income (loss) from discontinued operations       12,959       (60,545)
                                                   ----------     ---------     

  Net loss                                         $ (113,587)    $ (373,397)
                                                   ==========     ==========
  Net loss from continuing operations
    per share                                           $(.08)         $(.19) 
  Net income (loss) from discontinued operations
    per share                                             .01           (.03) 
                                                         ----          -----

  Net loss per share                                    $(.07)         $(.22) 
                                                         ====          ======

  Average number of shares outstanding              1,673,190       1,673,190
                                                    =========       =========

See Accompanying Notes to Financial Statements.

                                      -4-
</TABLE>
<PAGE>     
<TABLE>
                    NATIONAL CAPITAL MANAGEMENT CORPORATION
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
               FOR THE THREE MONTHS ENDED MARCH 31, 1998 AND 1997
<CAPTION>     
                                                      For the Three Months
                                                              Ended
                                                             March 31,
                                                      ----------  ---------
                                                         1998        1997  
                                                      ----------  ----------   
                                                     (Unaudited)  (Unaudited)
   <S>                                                 <C>         <C>
   Cash flows from operating activities:         
     Net loss                                        $(113,587)    $(373,397)
     Adjustments to reconcile net loss to
       net cash used in operating activities:
         Depreciation                                    2,190         2,191
         Reserves and allowances on notes receivable      -          200,000
         Changes in operating assets and liabilities:
           Increase (decrease) in accounts payable
             and accrued liabilities                    85,212       (65,500)
                                                       -------     ---------
         
   Net cash used in operating activities               (26,185)     (236,706)
                                                       -------     ---------

   Change in net assets of discontinued operations       2,051       (76,446)
                                                       -------      -------- 

   Cash flows from investing activities:
     Collections on notes receivable                      -          132,500
     Issuance of note receivable                          -         (198,035)
                                                       -------     ---------

   Net cash used in investing activities                  -          (65,535)
                                                       -------     ---------

   Decrease in cash and cash equivalents               (24,134)     (378,687)
     
   Cash and cash equivalents at
     beginning of period                                56,035       651,345
                                                       -------     ---------

   Cash and cash equivalents at end of period          $31,901     $ 272,658
                                                       =======     =========

See Accompanying Notes to Financial Statements.

                                        -5-
</TABLE>
<PAGE>
                   NATIONAL CAPITAL MANAGEMENT CORPORATION
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          MARCH 31, 1998 AND 1997
                               (Unaudited)
     
   NOTE 1 - THE COMPANY AND BASIS OF PRESENTATION
     
   The financial information for the three month periods ended March 31, 1998
   and 1997 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, 1998 are not necessarily indicative of the results
   to be expected for a full year.  The consolidated balance sheet as of
   December 31, 1997 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, 1997 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 Settlement 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.
   
   Reclassifications
   -----------------      

  Certain amounts as presented in prior year financial statements have been
  reclassified to conform with the current period presentation.
   
  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 basis 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
     
  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 (CONTINUED)
     
  In December 1996, the Company decided to discontinue the operations of the
  Viatical Settlements business.  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 years.  The Company established a $1,500,000 valuation reserve
  during 1996, and as adjusted during the quarter ended March 31, 1998,
  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.  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.
     
  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
  for the three months ended March 31, 1998 and 1997.
<TABLE>
<CAPTION>
                                               For the three months  
                                                  ended March 31,    
                                               1998         1997   
                                             ----------    ----------
                                             (Unaudited)   (Unaudited)
  <S>                                         <C>          <C>                    
  Revenue accrued and received                $1,033,738   $1,461,721
  Cost of insurance policies                   (756,843)   (1,208,725)
  Valuation reserve income                       92,205       110,321
                                              ---------    ----------
                                          
  Earned discount                               369,100       363,317
  Interest expense                             (308,374)     (337,692)
                                              ---------    ----------
 
  Earned discount after interest expense         60,726        25,625
  General and administrative expenses           (60,453)      (63,348)
  Depreciation and amortization                    (273)         (273)
                                              ---------    ----------
   
Net loss                                      $    -       $  (37,996)
                                              ==========   ==========
</TABLE>
  The components of the Viatical Settlements Segment net assets from
  discontinued operations in the consolidated balance sheet as of March 31,
  1998 and December 31, 1997 are as follows:
<TABLE>
<CAPTION>
                                                March 31,   December 31,
                                                  1998         1997    
                                               ----------    -----------
                                               (Unaudited)     (Audited)
  <S>                                          <C>            <C>
  Purchased policy costs, less amortized
    policy costs of $18,807,923 and 
    $18,051,081, respectively                  $ 3,443,359    $ 4,200,382
  Valuation reserve                               (955,972)    (1,048,177)
  Accrued policy revenues, less matured
    revenues valuation of $7,957,801 and
    $7,820,301, respectively                    14,404,949     13,715,134
  Revolving credit facility                     (9,077,225)    (9,511,468)
  Subordinated note payable                     (2,000,000)    (2,000,000)
  Reinsurance liability                         (5,381,808)    (4,927,799)
  Other, net                                      (397,784)      (402,544)
                                               -----------    ----------- 

                                               $    35,519    $    25,528
                                               ===========    ===========
     
                                       -7-
</TABLE>
<PAGE>
     
  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
  business.  The following is a description of the Company's recent disposal
  activity:
     
  Colony Ridge Apartments, the Company's only remaining real estate property
  since its disposal activities began in 1995, is an apartment complex in
  Decatur, Georgia which was constructed in 1968 and consists 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 is due to the
  repayment of the mortgage, state taxes, and miscellaneous expenses.
    
  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, 1998 and 1997:
<TABLE>
<CAPTION>
                                                  For the three months   
                                                    ended March 31,     
                                                    1998          1997   
                                                -----------    -----------
                                                (Unaudited)    (Unaudited)
   <S>                                            <C>           <C>     
   Total revenues                                 $279,588      $261,407
   Costs and expenses:
     Operations and maintenance                    147,432       149,590
     Property taxes and insurance                   20,042        19,716
     Depreciation and amortization                  75,000        73,500
     Net interest                                   24,155        26,905
     Corporate administrative expenses                -           14,245
                                                  --------      --------

   Total costs and expenses                        266,629       283,956
                                                  --------      --------

   Net income (loss)                              $ 12,959      $(22,549)
                                                  ========      ========
</TABLE>
   The components of the Real Estate Segment net assets from discontinued
   operations in the consolidated balance sheet as of March 31, 1998 and
   December 31, 1997 are as follows:
<TABLE>
<CAPTION>
                                                   March 31,  December 31,
                                                     1998         1997     
                                                  ----------- ------------
                                                  (Unaudited)   (Audited)
  <S>                                             <C>          <C>
  Rental properties, less accumulated
    depreciation of $1,532,881 and
    $1,457,881, respectively                      $2,868,286    $2,905,725
  Mortgage note payable                           (1,082,790)   (1,115,599)
  Accounts payable                                   (38,362)     (109,120)
  Other, net                                          35,854       114,024
                                                  ----------    ----------

                                                  $1,782,988    $1,795,030
                                                  ==========    ==========
</TABLE>
  NOTE 4  -  DISCONTINUED OPERATIONS:     
     
  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
  (see below).
     
                                      -8-
<PAGE>
  NOTE 4 - DISCONTINUED OPERATIONS - INDUSTRIAL PRODUCTS SEGMENT (CONTINUED)
     
  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 is 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.
     
  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 were distributed by the trustee in bankruptcy.  The
  Company received $56,686 in April 1998 as a result of the sale and
  anticipates receiving approximately an additional $95,000.  The remaining
  balance of the notes were written off as of December 31, 1997.  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 allows the Company to pursue Amko International in the United States
  courts.  The Company has not yet elected to pursue a remedy in the United
  States courts.  The Company is pursuing in the Netherlands collection
  efforts against the sole stockholder of AMKO for his personal guarantee.
  The Company cannot predict the outcome of this effort.    
     
                                     -9-
<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, 1998 and of the results of
   operations for the Company for the three months ended March 31, 1998 and
   1997, 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, 1997 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. 
     
   While the Company is managing the administration of the collection of the
   portfolio of life insurance policies and the orderly liquidation of its
   remaining real estate, management intends to seek other acquisitions.
     
   Accounting for long-lived assets
   --------------------------------     

   For the three months ending March 31, 1998 and calendar year December 31,
   1997, 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 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, the Company increased its original reserve by $350,000
   (Note 2).
     
                                      -10-
<PAGE>     
   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. 
   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 years (Note 2).
     
   Financial condition and liquidity
   ---------------------------------   

   The Company's cash decreased from $56,035 as of December 31, 1997 to
   $31,901 at March 31, 1998, principally as a result of financing operating
   activities.
     
   Other than in its Viatical Settlement subsidiary, 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 Settlement
   Business and liquidate the portfolio.
     
   Results of operations
   ---------------------     

   As a result of the Company's decision to discontinue its Viatical
   Settlements business 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 $19 
   million of insurance policies.  Management estimates that the
   administration of these policies will take several more years.
   
   During the three months ended March 31, 1998, approximately $137,500 of
   life insurance policies matured as compared to $740,000 for the same
   period last year.
     
   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, 1998.  During the fourth quarter ended December 31, 1997,
   the Company increased its original reserve by $350,000.  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 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 is due to the repayment of the mortgage, state taxes, and
   miscellaneous expenses.
     
                                      -11-
<PAGE>
     
   In December 1997, the Company wrote off all except $150,000 of notes
   receivable as a result of Jensen's bankruptcy (Note 4).  The Company
   received $56,686 in April 1998 and expects to receive approximately an
   additional $95,000.  Management believes this amount will be collected
   within a reasonable period of time.
     
                                       -12
<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
     
       
                                      -13-
<PAGE>
  
                                      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: May 12, 1998                 By:                //s// John C. Shaw
          ------------                    -----------------------------------
                                          John C. Shaw
                                          Chief Executive Officer


                                     -14-