SecProbe.io

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VIA FACSIMILE AND U.S. MAIL

August 1, 2005

Janet P. Spitler
Chief Financial Officer and Treasurer
Merchants Bancshares, Inc.
275 Kennedy Drive
South Burlington, Vermont 05403

	RE:	Form 10-K for Fiscal Year Ended December 31, 2004
      Form 10-Q for Fiscal Quarter Ended March 31, 2005
      File No. 0-11595

Dear Ms. Spitler:

		We have reviewed these filings and have the following
comments.  If you disagree with a comment, we will consider your
explanation as to why our comment is inapplicable or a revision is
unnecessary.  Please be as detailed as necessary in your
explanation.
In some of our comments, we may ask you to provide us with
information so we may better understand your disclosure.  After
reviewing this information, we may or may not raise additional
comments.

	Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects.  We welcome
any questions you may have about our comments or on any other
aspect
of our review.  Feel free to call us at the telephone numbers
listed
at the end of this letter.

FORM 10-K FOR FISCAL YEAR ENDED DECEMBER 31, 2004

Exhibits 31.1 and 31.2

1. Please file amendments to your Forms 10-K and 10-Qs to include
certifications that conform to the format provided in Item
601(b)(31)
of Regulation S-K.  Please include a paragraph before your
paragraph
4(b) that you have designed such internal control over financial
reporting, or caused such internal control over financial
reporting
to be designed under your supervision.  Also, include in the
introduction of paragraph 4 that internal control over financial
reporting is defined in Exchange Act Rules 13a-15(f) and 15d-
15(f).
In doing so, please refile each of these Forms 10-K and 10-Q in
their
entirety.

*    *    *    *

		Please respond to these comments within 10 business
days,
or tell us when you will provide us with a response.  Please
provide
us with a response letter that keys your responses to our comments
and provides any requested information.  Detailed letters greatly
facilitate our review.  Please file your response on EDGAR as a
correspondence file.  Please understand that we may have
additional
comments after reviewing your responses to our comments.

      We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing to be certain that the
filing includes all information required under the Securities
Exchange Act of 1934 and that they have provided all information
investors require for an informed investment decision.  Since the
company and its management are in possession of all facts relating
to
a company`s disclosure, they are responsible for the accuracy and
adequacy of the disclosures they have made.

	In connection with responding to our comments, please
provide,
in writing, a statement from the company acknowledging that:

* the company is responsible for the adequacy and accuracy of the
disclosure in their filings;
* staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filing; and
* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.

	In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in our review of your filing or in
response to our comments on your filing.

      If you have any questions regarding these comments, please
direct them to Ernest Greene, Staff Accountant, at (202) 551-3733
or,
in his absence, to the undersigned at (202) 551-3769.

						Sincerely,

								Rufus Decker
      							Accounting Branch Chief

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Ms. Janet P. Spitler
August 1, 2005
Page 1

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-0510

         DIVISION OF
CORPORATION FINANCE

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