Merchants & Marine Bancorp, Inc. Announces First Quarter Financial Results

PASCAGOULA, Miss.--(BUSINESS WIRE)--Merchants & Marine Bancorp, Inc. (OTCQX: MNMB), the parent company of Merchants & Marine Bank, reported net income for the first quarter of 2026 of $346 thousand, or $0.26 per share, compared with earnings of $814 thousand, or $0.52 per share, in the same period of the prior year. Net income available to common shareholders, net of preferred dividends, totaled $0.07 per share. Gross income in the first quarter totaled $13.57 million, an increase of 17.99% from the prior year. Balance sheet footings increased by 2.16% to $961.56 million during the quarter. Net loans eased slightly to $442.75 million during the quarter from $445.54 million at the end of 2025, a decrease of 0.62%. Total deposits increased 4.59% during the quarter, from $598.28 million at the end of 2025 to $625.72 million. Since the end of the quarter, these numbers have experienced significant change, as the acquisition of Farmers-Merchants Bank was completed on April 1, 2026.

Selected financial highlights:

• Net loans remained steady since FYE 2026, with a very small decrease of 0.62%.
• Total interest income during the first quarter increased to $11.43 million from $9.46 million during the same period in 2025, a lift of 20.89%. The increase is primarily the result of a leverage strategy wherein the company purchased $200 million in floating rate securities that carry an explicit payment guarantee from the United States Government. The company match-funded this securities, removing interest rate risk, and carving out a 75-80 basis point margin. This was done in order to fund increased costs associated with the acquisition of Farmers-Merchants Bank. Management expects to liquidate the leverage position in the coming quarters now that the acquisition has been consummated.
• The company’s cost of deposits as of quarter-end remained at an industry-low of 43 basis points.
• Credit quality remained strong at the end of the first quarter. The ratio of loans past due 30-89 days increased to 1.39% of total loans at the end of the first quarter from 0.90% at year-end 2025. This is concentrated in two larger loans, and is not indicative of more broad credit issues. The ratio of non-accrual loans declined in the same period, totaling 1.55% of total loans at the end of the first quarter compared to 1.75% at year-end 2025.
• Accumulated Other Comprehensive Income (AOCI) mark-to-market losses in the securities portfolio improved slightly to ($6.03 million) at the end of the first quarter of 2026 from ($6.58 million) at the end of 2025. These losses represent just 1.85% and 1.97% the total securities portfolio for these reporting periods, respectively.
• On balance sheet liquidity levels remain healthy, with cash and cash equivalents totaling $109.90 million at the end of the first quarter of 2026. In addition to these large cash balances, the Company’s investment portfolio remains highly liquid, with a significant portion of the portfolio able to be liquidated with minimal losses.
• In addition to the sizeable on-balance sheet liquidity position, the Company has more than $200 million in additional borrowing capacity at the Federal Home Loan Bank of Dallas and the Federal Reserve.

“While net income was marginal in the first quarter of 2026, it is important to understand the story behind the numbers. The company expended nearly half a million dollars on non-recurring merger-related costs in Q1,” remarked Casey Hill, the company’s Chief Financial Officer. He continued “in addition to those costs, we have increased expenditures on back-office operations and systems in preparation for the addition of Farmers-Merchants Bank’s balance sheet, colleagues, and customers. It should be considered, also, that the acquired institution generated $2.38 million in pre-tax net income in Q1 when adding back non-recurring merger expenses. We expect additive earnings from the acquisition to increase slightly until the end of the year as we are able to garner minor efficiencies until full systems conversion, and thereafter to increase more significantly post-conversion.”

“Though our reported earnings for the first quarter were modest, we remain highly encouraged by the broader trajectory of our Company and the successful completion of our acquisition of Farmers-Merchants Bank on April 1, 2026.” commented Clayton Legear, the company’s Chairman & Chief Executive Officer. Legear continued, “For several years, our team has intentionally invested in the infrastructure, talent, technology, and operational capacity needed to support a significantly larger organization. As a result, we entered this acquisition from a position of strength and preparedness. While these investments have temporarily pressured earnings, we believe they position our Company exceptionally well for long-term growth and enhanced shareholder value creation.”

“We are excited about the future of our expanded franchise and remain focused on disciplined execution, strong credit quality, and building long-term value for our shareholders, customers, communities, and team members.”

Merchants & Marine Bancorp, Inc. (OTCQX: MNMB) is the parent company of Merchants & Marine Bank, a Mississippi chartered community bank serving the Gulf South region. Originally founded in 1899, Merchants & Marine Bank was reborn in 1932 during the middle of the worst economic disaster in the history of the United States: The Great Depression. More than eight decades later, Merchants & Marine Bank has grown from $25,000 to nearly $1 billion in assets. The bank offers banking services to customers in Southern Mississippi and Coastal Alabama under its legacy Merchants & Marine Bank brand, and in Southern Louisiana through its Mississippi River Bank brand. It offers mortgage financing through its Canvas Mortgage brand, medical cannabis banking through its CannaFirst Financial brand, and access to government-guaranteed credit through its Voyager Lending brand. It provides bank operational, risk, and support services through its Community of Resources bank services brand. For more information on Merchants & Marine Bancorp, Inc., visit https://mandmbank.com/investor-relations

MERCHANTS & MARINE BANCORP, INC.
CONSOLIDATED FINANCIALS (UNAUDITED)
BALANCE SHEET
ASSETS	March 31, 2026			December 31, 2025
TOTAL CASH & DUE FROM		109,896,970.65			76,606,248.59
TOTAL SECURITIES		326,030,666.64			334,340,456.08
TOTAL FEDERAL FUNDS SOLD		-			16,051.54
TOTAL LOANS		448,122,480.57			450,898,498.32
Begin Year Reserve for Loss		(5,361,649.01	)		(6,286,501.00	)
Recoveries on Charge Off		(161,089.63	)		(471,344.41	)
Charge Offs Current Year		132,053.76			1,932,968.54
Allowance-Current Year		25,604.88			(536,772.14	)
RESERVE FOR LOSSES ON LOANS		(5,365,080.00	)		(5,361,649.01	)
NET LOANS		442,757,400.57			445,536,849.31
NET FIXED ASSETS		37,796,710.17			37,996,499.16
Other Real Estate		-			-
Other Assets		45,080,143.50			46,695,512.10
TOTAL OTHER ASSETS		45,080,143.50			46,695,512.10
TOTAL ASSETS	$	961,561,891.53		$	941,191,616.78
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Demand Deposits	$	433,946,652.14		$	409,229,765.95
Public Funds		22,950,891.91			21,808,152.47
TOTAL DEMAND DEPOSITS		456,897,544.05			431,037,918.42
Savings		117,244,319.88			115,493,243.99
C D's		42,978,434.13			42,926,423.84
I R A's		6,118,276.01			6,351,873.28
CDARS		2,479,664.28			2,473,002.44
TOTAL TIME & SAVINGS DEPOSITS		168,820,694.30			167,244,543.55
TOTAL DEPOSITS		625,718,238.35			598,282,461.97
SECURITIES SOLD UNDER REPO
& BORRROWINGS		196,250,000.00			201,000,000.00
DIVIDENDS PAYABLE		399,101.40			731,685.90
TOTAL OTHER LIABILITIES		7,908,575.45			10,130,198.54
Stockholders' Equity
Preferred Stock	$	50,595,000.00		$	50,595,000.00
Common Stock		3,325,845.00			3,325,845.00
Earned Surplus		14,500,000.00			14,500,000.00
Undivided Profits		71,884,702.98			68,253,240.46
Current Profits		346,411.54			4,283,538.92
Total Unrealized Gain/Loss AFS		(6,033,535.19	)		(6,577,906.01	)
Defined Benefit Pension FASB 158		(3,332,448.00	)		(3,332,448.00	)
TOTAL CAPITAL		131,285,976.33			131,047,270.37
TOTAL LIABILITIES & CAPITAL	$	961,561,891.53		$	941,191,616.78

MERCHANTS & MARINE BANCORP, INC.
CONSOLIDATED FINANCIALS (UNAUDITED)
INCOME STATEMENT
ACCOUNT NAME	QUARTER ENDED MARCH 31, 2026			QUARTER ENDED MARCH 31, 2025
Interest & Fees on Loans	$	7,584,522.14		$	8,135,864.32
Interest on Securities Portfolio		3,297,493.63			1,223,984.17
Interest on Fed Funds & EBA		552,753.88			98,835.72
TOTAL INTEREST INCOME		11,434,769.65			9,458,684.21
Total Service Charges		862,175.14			808,609.86
Total Miscellaneous Income		1,281,409.11			1,241,004.02
TOTAL NON INT INCOME		2,143,584.25			2,049,613.88
Gains/(Losses) on Secs		-			-
Gains/(Losses) on Sales REO		-			-
Gains/(Losses) on Sale of Loans		-			-
TOTAL INCOME		13,578,353.90			11,508,298.09
TOTAL INT ON DEPOSITS		752,014.22			602,482.43
Int on Borrowings/Sec Sold Repo		1,887,181.57			1,361.31
TOTAL INT EXPENSE		2,639,195.79			603,843.74
PROVISION-LOAN LOSS		(26,226.05	)		81,175.64
Salary & Employee Benefits		5,814,128.29			5,550,132.40
Total Premises Expense		1,850,206.06			1,436,961.21
FDIC, Sales and Franchise		205,300.86			128,769.94
Professional Fees		327,133.91			437,380.21
Miscellaneous Office Expense		220,771.24			281,924.27
Dues, Donations and Advertising		190,119.07			160,983.49
Checking, ATM/Debit Card Expenses		1,087,781.18			417,799.95
ORE Expenses		300.00			300.00
Total Miscellaneous Expense		990,854.01			1,495,048.14
TOTAL OTHER OPERATING		10,686,594.62			9,909,299.61
FEDERAL & STATE INCOME TAXES		(67,622.00	)		99,850.00
TOTAL EXPENSES		13,231,942.36			10,694,168.99
NET INCOME	$	346,411.54		$	814,129.10
Preferred Stock Dividends	$	252,975.00		$	252,975.00
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS	$	93,436.54		$	561,154.10