Mechanics Bank in Richmond, Calif., is testing the Treasury Department's flexibility for banks participating in the Troubled Asset Relief Program.

The $2.7 billion-asset Mechanics, which received approval for a $60 million capital infusion from the Treasury, says it has asked for permission to issue a fifth dividend for 2008. Under the Treasury program, banks that receive Tarp funds cannot pay dividends more than four times a year unless they receive special permission.

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