##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-K
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2008
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from to
 Commission File Number: 000-53198
 MERCHANTS & MARINE BANCORP, INC.
  Mississippi
    
    26-2498567(State or other jurisdiction 
of incorporation)
    
    (I.R.S. Employer
Identification No.)
 3118 Pascagoula Street, Pascagoula, Mississippi
    
    39567(Address of principal executive offices)
    
    (Zip Code)
 228) 762-3311
 Securities registered pursuant to Section 12 (b) of the Act:
 Title of Each Class
    
    Name of Exchange on which RegisteredNone
    
    None
 Securities registered to Section 12(g) of the Act:
 o þ
 o þ
 þ o
 o
  Large accelerated filer o
Accelerated filer o
Non-accelerated filer o(Do not check if a smaller reporting company)
Smaller reporting company þ o þ




---



TABLE OF CONTENTS  PART IItem 1. Business.Item IA. Risk Factors.Item 1B. Unresolved Staff Comments.Item 2. Properties.Item 3. Legal Proceedings.Item 4. Submission of Matters to a Vote of Security Holders.PART IIItem 5. Market For Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.Item 6. Selected Financial Data.Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations.Item 7A. Quantitative and Qualitative Disclosures About Market Risk.Item 8. Financial Statements and Supplementary Data.Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.Item 9A. Controls and Procedures.Item 9B. Other Information.PART IIIItem 10. Directors, Executive Officers and Corporate Governance.Item 11. Executive Compensation.Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.Item 13. Certain Relationships and Related Transactions, and Director Independence.Item 14. Principal Accounting Fees and Services.PART IVItem 15. Exhibits, Financial Statement Schedules.SIGNATURESINDEX TO EXHIBITSEX-4EX-10EX-13EX-21EX-31.1EX-31.2EX-32.1EX-32.2    Table of Contents  
 PART I
 
 Item 1. Business.
         Financial and Statistical Information
 Annual Report to Shareholders 2008 Annual Report
 2




---



##### Table of Contents



Regulation and Supervision
        Community Reinvestment Act
  3




---



##### Table of Contents



Dividends
  FDICIA
     Risk-Based Capital Requirements
  4




---



##### Table of Contents




    
    the allowance for possible credit losses in an amount up to 1.25% of
risk-weighted assets;
    
    cumulative perpetual preferred stock with an original maturity of 20 years or
more and related surplus;
    
    hybrid capital instruments defined as instruments with characteristics of both
debt and equity, perpetual debt and mandatory convertible debt securities; and
    
    in an amount up to 50% of Tier I capital, eligible term subordinated debt and
intermediate-term preferred stock with an original maturity of five years or more,
including related surplus.
   Leverage Capital Requirements
  5




---



##### Table of Contents



Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994
  Federal Deposit Insurance Reform Act of 2005
  The Emergency Economic Stabilization Act (EESA) of 2008
  Monetary Policy
  6




---



##### Table of Contents



Competition
    Available Information
  
 Item IA. Risk Factors.
 Recent negative developments in the financial services industry and U.S. and global credit
markets may adversely impact the Companys operations and results
  7




---



##### Table of Contents



The Company is geographically concentrated in Jackson and George Counties, Mississippi and its
surrounding counties and changes in local economic conditions could impact its profitability.
  The Company could sustain losses if its asset quality declines.
  An inadequate allowance for loan losses would reduce the Companys earnings.
  Liquidity needs could adversely affect the Companys results of operations and financial
condition.
  Competition from financial institutions and other financial service providers may adversely
affect the Companys profitability.
 8




---



##### Table of Contents



The Companys key management personnel may leave at any time.
  The Company, as well as the Bank, operates in a highly regulated environment and is supervised
and examined by various federal and state regulatory agencies who may adversely affect the
Companys ability to conduct business.
  
    
    explicit standards as to capital and financial condition;
    
    limitations on the permissible types, amounts and extensions of credit and investments;
    
    restrictions on permissible non-banking activities; and
    
    restrictions on dividend payments.
   The enactment of Emergency Economic Stabilization Act of 2008 and the American Recovery and
Reinvestment Act of 2009 may not be able to stabilize the U.S. financial system or the economy and
may significantly affect the Companys financial condition, results of operation or liquidity.
  9




---



##### Table of Contents



The Companys Common Stock is thinly traded, and recent prices may not reflect the prices at
which the stock would trade in an active trading market.
  
 Item 1B. Unresolved Staff Comments.
  
 Item 2. Properties.
 Company Facilities
  Main Office
 Market Street Branch
 Gautier Branch
 10




---



##### Table of Contents



Moss Point Branch
 Escatawpa Branch
 Bel-Air Branch
 Wade Branch
 Ocean Springs Branch
 Hurley Branch
 St. Martin Branch
 Lucedale Branch
  Other Real Estate
 
 Item 3. Legal Proceedings.
  
 Item 4. Submission of Matters to a Vote of Security Holders.
  11




---



##### Table of Contents



PART II
 
 Item 5. Market For Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of
Equity Securities.
  Stock Prices
 2008
    
    High
    
    Low1st Quarter
    
    $
    40.00
    
    
    $
    38.002nd Quarter
    
    
    40.00
    
    
    
    36.003rd Quarter
    
    
    40.00
    
    
    
    40.004th Quarter
    
    
    40.00
    
    
    
    38.00
 2007
    
    High
    
    Low1st Quarter
    
    $
    38.00
    
    
    $
    38.002nd Quarter
    
    
    40.00
    
    
    
    38.003rd Quarter
    
    
    42.00
    
    
    
    39.004th Quarter
    
    
    40.00
    
    
    
    40.00
  2008
    
    
    20071st Quarter
    
    $
    0.25
    
    
    $
    0.252nd Quarter
    
    
    0.30
    
    
    
    0.303rd Quarter
    
    
    0.25
    
    
    
    0.254th Quarter
    
    
    0.55
    
    
    
    0.55Total
    
    $
    1.35
    
    
    $
    1.35
  
 Item 6. Selected Financial Data.
  
 Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations.
  12




---



##### Table of Contents



Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
  
 Item 8. Financial Statements and Supplementary Data.
  
 Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.
  
 Item 9A. Controls and Procedures.
  Changes in Internal Control Over Financial Reporting
  Managements Report On Internal Control Over Financial Reporting
   Internal Control-Integrated Framework
  
 Item 9B. Other Information.
  
 PART III
 
 Item 10. Directors, Executive Officers and Corporate Governance.
  13




---



##### Table of Contents



Item 11. Executive Compensation.
  
 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters.
   
 Item 13. Certain Relationships and Related Transactions, and Director Independence.
  
 Item 14. Principal Accounting Fees and Services.
  
 PART IV
 
 Item 15. Exhibits, Financial Statement Schedules.
 (a)(1)
    
    Financial Statements. See Item 8.(a)(2)
    
    Financial Statement Schedules. Inapplicable.(a)(3)
    
    Exhibits. See Index to Exhibits.
 14




---



##### Table of Contents



SIGNATURES
  MERCHANTS & MARINE BANCORP, INC.March 20, 2009
    By:
    /s/ Royce CumbestRoyce CumbestChairman of the Board, President and
Chief Executive Officer  Signature
    
    Title
    
    Date/s/ Royce Cumbest

Royce Cumbest
    
    Chairman of the Board, President
and Chief Executive Officer
(Principal Executive Officer)
    
    March 20, 2009/s/ Frank J. Hammond, III

Frank J. Hammond, III
    
    Director
    
    March 20, 2009/s/ Lynda J. Gautier

Lynda J. Gautier
    
    Director
    
    March 20, 2009/s/ Dr. Paul H. Moore, Jr.

Dr. Paul H. Moore, Jr.
    
    Director
    
    March 20, 2009/s/ John M. Ford
    
    Director
    
    March 20, 2009John M. Ford/s Gerald J. St. Pe

Gerald J. St. Pe
    
    Director
    
    March 20, 2009/s/ Thomas B. Van Antwerp

Thomas B. Van Antwerp
    
    Director
    
    March 20, 2009/s/ John F. Grafe

John F. Grafe
    
    Director
    
    March 20, 2009/s/ Julius A. Willis, Jr., DMD

Julius A. Willis, Jr., DMD
    
    Director
    
    March 20, 2009/s/ S. Michael Dickson

S. Michael Dickson
    
    Executive Vice President (Principal Financial
and Accounting Officer)
    
    March 20, 2009
 15




---



##### Table of Contents



INDEX TO EXHIBITS
 2.1
    
    The Agreement and Plan of Share Exchange by and between Merchants & Marine Bancorp, Inc. and
Merchants & Marine Bank, dated February 2, 2008, is incorporated by reference from Exhibit 2.1
of the Companys Form 8-K 12g3 filed on April 29, 2008.2.2
    
    The Articles of Share Exchange by and between Merchants & Marine Bancorp, Inc. and Merchants
& Marine Bank, dated February 5, 2008, is incorporated by reference from Exhibit 2.2 of the
Companys Form 8-K 12g3 filed on April 29, 2008.3.1
    
    The Articles of Incorporation of the Company are incorporated by reference from Exhibit 3.1
of the Companys Form 8-K 12g3 filed on April 29, 2008.3.2
    
    The Bylaws of the Company are incorporated by reference from Exhibit 3.2 of the Companys
Form 8-K 12g3 filed on April 29, 2008.4
    
    Specimen Common Stock Certificate.10
    
    Director Deferred Compensation Plan.13
    
    Selected portions of the Companys 2008 Annual Report for the year ended December 31, 2008.21
    
    Subsidiaries of Merchants & Marine Bancorp, Inc.31.1
    
    Certification of principal executive officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    Certification of principal financial officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1
    
    Certification of principal executive officer pursuant to 18 U.S.C. Section 1350, as created
by Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    Certificate of principal financial officer pursuant to 18 U.S.C. Section 1350, as created by
Section 906 of the Sarbanes-Oxley Act of 2002.
 16