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                                  EXHIBIT 10.1

                              EMPLOYMENT AGREEMENT


         THIS EMPLOYMENT AGREEMENT (hereinafter referred to as this "AGREEMENT")
is entered into as of the 15th day of December, 2000, by and between Columbia
Federal Savings Bank, a savings bank chartered under the laws of the United
States (hereinafter referred to as the "EMPLOYER"), and Robert V. Lynch, an
individual (hereinafter referred to as the "EMPLOYEE");

                                   WITNESSETH:

         WHEREAS, the EMPLOYEE is currently employed as the President and Chief
Executive Officer of the EMPLOYER;

         WHEREAS, as a result of the skill, knowledge and experience of the
EMPLOYEE, the Board of Directors of the EMPLOYER desires to retain the services
of the EMPLOYEE as the President and Chief Executive Officer of the EMPLOYER;

         WHEREAS, the EMPLOYEE desires to continue to serve as the President and
Chief Executive Officer of the EMPLOYER; and

         WHEREAS, the EMPLOYEE and the EMPLOYER desire to enter into this
AGREEMENT to set forth the terms and conditions of the employment relationship
between the EMPLOYER and the EMPLOYEE;

         NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, the EMPLOYER and the EMPLOYEE hereby agree as follows:

1.       Employment and Term.

         (a) Term. Upon the terms and subject to the conditions of this
AGREEMENT, the EMPLOYER hereby employs the EMPLOYEE, and the EMPLOYEE hereby
accepts employment, as the President and Chief Executive Officer of the
EMPLOYER. The TERM of this AGREEMENT shall commence on the date set forth above
and shall end thirty-six (36) months thereafter, subject to extension pursuant
to subsection (b) of this Section 1 (hereinafter, including any such extensions,
referred to as the "TERM"), and to earlier termination as provided herein.

         (b) Extension. Prior to each anniversary of the date of this AGREEMENT,
the Board of Directors of the EMPLOYER shall review the performance of the
EMPLOYEE and this AGREEMENT and document the results of the review in the board
minutes. In connection with such annual review, the TERM shall be extended for a
one-year period beyond the then-effective expiration date, provided the Board of
Directors of the EMPLOYER determines in a duly adopted resolution that this
AGREEMENT should be extended. Any such extension shall be subject to the written
consent of the EMPLOYEE.

2.       Duties of EMPLOYEE.

         (a) General Duties and Responsibilities. The EMPLOYEE shall serve as
the President and Chief Executive Officer of the EMPLOYER. Subject to the
direction of the Board of Directors of the EMPLOYER, the EMPLOYEE shall have
responsibility for the general management and control of the business and
affairs of the EMPLOYER and shall perform all duties and shall have all powers
which are commonly incident to the office of President and Chief Executive
Officer or which, consistent therewith, are delegated to him by the Board of
Directors. Such duties shall include, but not be limited to, (1) managing the
day-to-day operations of the EMPLOYER, (2) managing the efforts of the EMPLOYER
to comply with applicable laws and regulations, (3) marketing of the EMPLOYER
and its services, (4) supervising other employees of the EMPLOYER, (5) providing


<PAGE>   2

prompt and accurate reports to the Board of Directors of the EMPLOYER regarding
the affairs and conditions of the EMPLOYER, and (6) making recommendations to
the Board of Directors of the EMPLOYER concerning the strategies, capital
structure, tactics, and general operations of the EMPLOYER.

         (b) Devotion of Entire Time to the Business of the EMPLOYER. The
EMPLOYEE shall devote his entire productive time, ability and attention during
normal business hours throughout the TERM to the faithful performance of his
duties to the EMPLOYER and its holding company and their subsidiaries and
affiliates. The EMPLOYEE shall not directly or indirectly render any services of
a business, commercial or professional nature to any person or organization
other than the EMPLOYER and its holding company and their subsidiaries and
affiliates without the prior written consent of the Board of Directors of the
EMPLOYER; provided, however, that the EMPLOYEE shall not be precluded from (i)
reasonable participation in community, civic, charitable or similar
organizations; or (ii) the pursuit of personal investments which do not
interfere or conflict with the performance of the EMPLOYEE's duties to the
EMPLOYER. Nothing in this section shall limit the EMPLOYEE's right to invest in
securities of any business that does not provide services or products of the
type or competing with those provided by the EMPLOYER or its subsidiaries or
affiliates.

3.       Compensation, Benefits and Reimbursements.

         (a) Salary. The EMPLOYEE shall receive during the TERM an annual salary
payable in equal installments not less often than monthly. The amount of such
annual salary shall be $129,797 until changed by the Board of Directors of the
EMPLOYER in accordance with Section 3(b) of this AGREEMENT.

         (b) Annual Salary Review. On or before each anniversary of the
effective date of this AGREEMENT, the annual salary of the EMPLOYEE shall be
reviewed by the Board of Directors of the EMPLOYER and may be maintained or
increased, in its discretion, based upon the EMPLOYEE's individual performance
and the overall profitability and financial condition of the EMPLOYER. The
results of the annual salary review shall be reflected in the minutes of the
appropriate meetings of the Board of Directors of the EMPLOYER.

         (c) Expenses. In addition to any compensation received under Section
3(a) or (b) of this AGREEMENT, the EMPLOYER shall pay or reimburse the EMPLOYEE
for all reasonable travel, entertainment and miscellaneous expenses incurred in
connection with the performance of his duties under this AGREEMENT. Such
reimbursement shall be made in accordance with the existing policies and
procedures of the EMPLOYER pertaining to reimbursement of expenses to senior
management officials.

         (d) Employee Benefit Programs.

                  (i) During the TERM, the EMPLOYEE shall be entitled to
         participate in all formally established employee benefit, bonus,
         pension and profit-sharing plans and similar programs that are
         maintained by the EMPLOYER from time to time, including programs in
         respect of group health, disability or life insurance, and all employee
         benefit plans or programs hereafter adopted in writing by the Board of
         Directors of the EMPLOYER, for which senior management personnel are
         eligible, including any employee stock ownership plan, stock option
         plan or other stock benefit plan (hereinafter collectively referred to
         as the "BENEFIT PLANS"). Notwithstanding any statement to the contrary
         contained elsewhere in this Agreement, the EMPLOYER may discontinue or
         terminate at any time any such BENEFIT PLANS, now existing or hereafter
         adopted, to the extent permitted by the terms of such plans and
         applicable law, and shall not be required to compensate the EMPLOYEE
         for such discontinuance or termination; and

                  (ii) After the termination of the employment of the EMPLOYEE
         in accordance with Section 4(a) of this AGREEMENT, for any reason other
         than JUST CAUSE (as defined hereinafter), the EMPLOYER shall provide,
         until both the EMPLOYEE and his spouse become sixty-five (65) years of
         age, or the earlier date the EMPLOYEE obtains substantially equivalent
         coverage from another full-time employer, substantially the same health
         insurance benefits as are available to retired employees of the
         EMPLOYER on the date of this AGREEMENT; provided, however, that all
         premiums for such benefits shall be paid by the EMPLOYEE and/or his


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         spouse after the EMPLOYEE's termination; provided further, however,
         that the EMPLOYER'S obligation under this Section 3(d)(ii) shall
         terminate in the event that the EMPLOYER no longer makes available an
         employee group health insurance program which permits the EMPLOYER to
         make coverage available for retirees.

         (e) Vacation and Sick Leave. The EMPLOYEE shall be entitled, without
loss of pay, to be absent voluntarily from the performance of his duties under
this AGREEMENT, subject to the following conditions:

                  (i) The EMPLOYEE shall be entitled to annual vacation and
         annual sick leave in accordance with the policies periodically
         established by the Board of Directors of the EMPLOYER for senior
         management officials of the EMPLOYER; and

                  (ii) In addition to paid vacations and sick leave, the
         EMPLOYEE shall be entitled, without loss of pay, to absent himself
         voluntarily from the performance of his employment with the EMPLOYER
         for such additional period of time and for such valid and legitimate
         reasons as the Board may, in its discretion, determine, and the Board
         may grant to the EMPLOYEE a leave or leaves of absence, with or without
         pay, at such time or times and upon such terms and conditions as such
         Board, in its discretion, may determine.

4.       Termination of Employment.

         (a) General. The employment of the EMPLOYEE shall terminate at any time
during the TERM (i) at the option of the EMPLOYER upon the delivery by the
EMPLOYER of written notice of employment termination to the EMPLOYEE, or (ii) at
the option of the EMPLOYEE upon the delivery by the EMPLOYEE of written notice
of termination to the EMPLOYER if, unless consented to in writing by the
EMPLOYEE, (A) the present capacity or circumstances in which the EMPLOYEE is
employed are materially changed (including, without limitation, a material
reduction in responsibilities or authority, or the assignment of duties or
responsibilities substantially inconsistent with those normally associated with
EMPLOYEE's position described in Section 2(a) of this AGREEMENT), (B) the
EMPLOYEE is no longer the President and Chief Executive Officer of the EMPLOYER
and Columbia Financial of Kentucky, Inc., (C) the EMPLOYEE is required to move
his personal residence, or perform his principal executive functions, more than
thirty-five (35) miles from his primary office as of the date of the
commencement of the TERM of this AGREEMENT, or (D) the EMPLOYER otherwise
breaches this AGREEMENT in any material respect.

         (b) Termination for JUST CAUSE. In the event that the EMPLOYER
terminates the employment of the EMPLOYEE before the expiration of the TERM
because of the EMPLOYEE's personal dishonesty, incompetence, willful misconduct,
breach of fiduciary duty involving personal profit, intentional failure or
refusal to perform the duties and responsibilities assigned in this AGREEMENT,
willful violation of any law, rule, regulation (other than traffic violations or
similar offenses) or final cease-and-desist order, conviction of a felony or for
fraud or embezzlement, or material breach of any provision of this AGREEMENT
(hereinafter collectively referred to as "JUST CAUSE"), the EMPLOYEE shall not
receive, and shall have no right to receive, any compensation or other benefits
for any period after such termination.

         (c) Termination in Connection with a CHANGE OF CONTROL.

                  (i) In the event that, in connection with a CHANGE OF CONTROL
         (including, without limitation, a termination other than for JUST CAUSE
         within six months prior to a CHANGE OF CONTROL) or within one year
         after a CHANGE OF CONTROL, the employment of the EMPLOYEE is terminated
         by the EMPLOYER for any reason other than JUST CAUSE before the
         expiration of the TERM, then the following shall occur:

                           (A) The EMPLOYER shall promptly pay to the EMPLOYEE
                  or to his beneficiaries, dependents or estate an amount equal
                  to the product of three multiplied by the greater of the
                  annual salary set forth in Section 3(a) of this AGREEMENT or
                  the annual salary payable to the EMPLOYEE as a result of any
                  annual salary review in accordance with Section 3 (b) of this
                  AGREEMENT;


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                           (B) The EMPLOYEE, his dependents, beneficiaries and
                  estate shall continue to be covered under all BENEFIT PLANS in
                  which the EMPLOYEE is a participant immediately prior to the
                  CHANGE OF CONTROL of the EMPLOYER at the EMPLOYER's expense as
                  if the EMPLOYEE were still employed under this AGREEMENT until
                  the earliest of the expiration of the TERM or the date on
                  which the EMPLOYEE is included in another employer's benefit
                  plans as a full-time employee and shall be entitled thereafter
                  to the benefits described in Section 3(d)(ii) of this
                  AGREEMENT; and

                           (C) The EMPLOYEE shall not be required to mitigate
                  the amount of any payment provided for in this AGREEMENT by
                  seeking other employment or otherwise, nor shall any amounts
                  received from other employment or otherwise by the EMPLOYEE
                  offset in any manner the obligations of the EMPLOYER
                  hereunder, except as specifically stated in subparagraph (B).

         (ii) In the event that, within six months prior to or within one year
after a CHANGE OF CONTROL, the employment of the EMPLOYEE is terminated by the
EMPLOYEE in accordance with Section 4(a)(ii) of this AGREEMENT before the
expiration of the TERM, then the following shall occur:

                  (A) The EMPLOYER shall promptly pay to the EMPLOYEE or to his
         beneficiaries, dependents or estate an amount equal to the product of
         three multiplied by the greater of the annual salary set forth in
         Section 3(a) of this AGREEMENT or the annual salary payable to the
         EMPLOYEE as a result of any annual salary review in accordance with
         Section 3(b) of this AGREEMENT;

                  (B) The EMPLOYEE, his dependents, beneficiaries and estate
         shall continue to be covered under all BENEFIT PLANS in which the
         EMPLOYEE is a participant immediately prior to the CHANGE OF CONTROL of
         the EMPLOYER at the EMPLOYER's expense as if the EMPLOYEE were still
         employed under this AGREEMENT until the earliest of the expiration of
         the TERM or the date on which the EMPLOYEE is included in another
         employer's benefit plans as a full-time employee and shall be entitled
         thereafter to the benefits described in Section 3(d)(ii) of this
         AGREEMENT; and

                  (C) The EMPLOYEE shall not be required to mitigate the amount
         of any payment provided for in this AGREEMENT by seeking other
         employment or otherwise, nor shall any amounts received from other
         employment or otherwise by the EMPLOYEE offset in any manner the
         obligations of the EMPLOYER hereunder, except as specifically stated in
         subparagraph (B).

         In the event that payments pursuant to this subsection (c) would result
in the imposition of a penalty tax pursuant to Section 280G(b)(3) of the
Internal Revenue Code of 1986, as amended, and the regulations promulgated
thereunder (hereinafter collectively referred to as "SECTION 280G"), such
payments shall be reduced to the maximum amount which may be paid under SECTION
280G without exceeding such limits. Payments pursuant to this subsection (c)
also may not exceed applicable limits established by the Office of Thrift
Supervision (hereinafter referred to as the "OTS"), as set forth in OTS
Regulatory Bulletin 27a. In the event a reduction in payments is necessary in
order to comply with the requirements of this AGREEMENT relating to the
limitations of SECTION 280G or applicable OTS limits, the EMPLOYEE may
determine, in his sole discretion, which categories of payments are to be
reduced or eliminated.

         (d) Termination Without CHANGE OF CONTROL. In the event that the
employment of the EMPLOYEE is terminated by the EMPLOYER or is terminated by the
EMPLOYEE in accordance with Section 4(a)(ii) of this AGREEMENT before the
expiration of the TERM other than (i) for JUST CAUSE or (ii) in connection with
or after a CHANGE OF CONTROL, the EMPLOYER shall be obligated (A) to pay to the
EMPLOYEE, his designated beneficiaries or his estate, for the remainder of the
TERM, the salary set forth in Section 3(a) of this AGREEMENT or the salary
payable to the EMPLOYEE as a result of any annual salary review in accordance
with Section 3(b) of this AGREEMENT; (B) to provide to the EMPLOYEE, at the
EMPLOYER's expense, health, life, disability, and other benefits as provided in
Section 3(d)(i) of this Agreement, until the expiration of the TERM or until the
earlier date the EMPLOYEE obtains substantially equivalent coverage from another
full-time employer; and (C) to provide to the EMPLOYEE the benefits set forth
under Section 3(d)(ii) of this AGREEMENT. In the event that payments pursuant to
this subsection (d) would result in the imposition of a


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penalty tax pursuant to SECTION 280G, such payments shall be reduced to the
maximum amount which may be paid under SECTION 280G without exceeding those
limits. Payments pursuant to this subsection also may not exceed the applicable
limits established by the OTS, as set forth in OTS Regulatory Bulletin 27a. In
the event a reduction in payments is necessary in order to comply with the
requirements of this AGREEMENT relating to the limitations of SECTION 280G or
applicable OTS limits, the EMPLOYEE may determine, in his sole discretion, which
categories of payments are to be reduced or eliminated.

         (e) Death of the EMPLOYEE. The TERM shall automatically terminate upon
the death of the EMPLOYEE. In the event of such death, the EMPLOYEE's estate
shall be entitled to receive the compensation due the EMPLOYEE through the last
day of the calendar month in which the death occurred, except as otherwise
specified herein.

         (f) "Golden Parachute" Provision. Any payments made to the EMPLOYEE
pursuant to this AGREEMENT or otherwise are subject to and conditioned upon
their compliance with 12 U.S.C.Section 1828(k) and any regulations promulgated
thereunder.

         (g) Definition of "CHANGE OF CONTROL". A "CHANGE OF CONTROL" shall mean
any one of the following events: (i) the acquisition of ownership or power to
vote more than 25% of the voting stock of the EMPLOYER or Columbia Financial of
Kentucky, Inc.; (ii) the acquisition of the ability to control the election of a
majority of the directors of the EMPLOYER or Columbia Financial of Kentucky,
Inc.; (iii) during any period of two consecutive years, individuals who at the
beginning of such period constitute the Board of Directors of the EMPLOYER or
Columbia Financial of Kentucky, Inc., cease for any reason to constitute at
least a majority thereof; provided, however, that any individual whose election
or nomination for election as a member of the Board of Directors of the EMPLOYER
or its holding company was approved by a vote of at least two-thirds of the
directors then in office shall be considered to have continued to be a member of
the Board of Directors of the EMPLOYER or its holding company; or (iv) the
acquisition by any person or entity of "conclusive control" of the EMPLOYER
within the meaning of 12 C.F.R. Section 574.4(a), or the acquisition by any
person or entity of "rebuttable control" within the meaning of 12 C.F.R. Section
574.4(b) that has not been rebutted in accordance with 12 C.F.R. Section
574.4(c). For purposes of this paragraph, the term "person" refers to an
individual or corporation, partnership, trust, association, or other
organization, but does not include the EMPLOYEE and any person or persons
with whom the EMPLOYEE is "acting in concert" within the meaning of 12 C.F.R.
Part 574.

         (h) Legal Fees. EMPLOYER shall promptly pay all legal fees and expenses
which EMPLOYEE may incur as a result of EMPLOYEE or EMPLOYER contesting the
validity or enforceability of this AGREEMENT if a court of competent
jurisdiction renders a final decision in favor of EMPLOYEE with respect to any
such contest, or to the extent agreed to by EMPLOYER and EMPLOYEE in an
agreement of settlement with respect to any such contest.

5.       Special Regulatory Events. Notwithstanding Section 4 of this AGREEMENT,
the obligations of the EMPLOYER to the EMPLOYEE shall be as follows in the event
of the following circumstances:

         (a) If the EMPLOYEE is suspended and/or temporarily prohibited from
participating in the conduct of the EMPLOYER's affairs by a notice served under
Section 8(e) (3) or (g) (1) of the Federal Deposit Insurance Act (hereinafter
referred to as the "FDIA"), the EMPLOYER's obligations under this AGREEMENT
shall be suspended as of the date of service of such notice, unless stayed by
appropriate proceedings. If the charges in the notice are dismissed, the
EMPLOYER shall (i) pay the EMPLOYEE all of the compensation withheld while the
obligations in this AGREEMENT were suspended and (ii) reinstate any of the
obligations that were suspended.

         (b) If the EMPLOYEE is removed and/or permanently prohibited from
participating in the conduct of the EMPLOYER's affairs by an order issued under
Section 8(e) (4) or (g) (1) of the FDIA, all obligations of the EMPLOYER under
this AGREEMENT shall terminate as of the effective date of such order; provided,
however, that vested rights of the EMPLOYEE shall not be affected by such
termination.


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         (c) If the EMPLOYER is in default as defined in Section 3(x)(1) of the
FDIA, all obligations under this AGREEMENT shall terminate as of the date of
default; provided, however, that vested rights of the EMPLOYEE shall not be
affected.

         (d) All obligations under this AGREEMENT shall be terminated, except to
the extent of a determination that the continuation of this AGREEMENT is
necessary for the continued operation of the EMPLOYER, (i) by the Director of
the OTS, or his or her designee at the time that the Federal Deposit Insurance
Corporation enters into an agreement to provide assistance to or on behalf of
the EMPLOYER under the authority contained in Section 13(c) of the FDIA or (ii)
by the Director of the OTS, or his or her designee, at any time the Director of
the OTS, or his or her designee, approves a supervisory merger to resolve
problems related to the operation of the EMPLOYER or when the EMPLOYER is
determined by the Director of the OTS to be in an unsafe or unsound condition.
No vested rights of the EMPLOYEE shall be affected by any such action.

6.       Consolidation, Merger or Sale of Assets. Nothing in this AGREEMENT
shall preclude the EMPLOYER from consolidating with, merging into, or
transferring all, or substantially all, of its assets to another corporation
that assumes all of the EMPLOYER's obligations and undertakings hereunder. Upon
such a consolidation, merger or transfer of assets, the term "EMPLOYER," as used
herein, shall mean such other corporation or entity, and this AGREEMENT shall
continue in full force and effect.

7.       Confidential Information. The EMPLOYEE acknowledges that during his
employment he will learn and have access to confidential information regarding
the EMPLOYER and its customers and businesses. The EMPLOYEE agrees and covenants
not to disclose or use for his own benefit, or the benefit of any other person
or entity, any confidential information, unless or until the EMPLOYER consents
to such disclosure or use or such information becomes common knowledge in the
industry or is otherwise legally in the public domain. The EMPLOYEE shall not
knowingly disclose or reveal to any unauthorized person any confidential
information relating to the EMPLOYER, its parent, subsidiaries or affiliates, or
to any of the businesses operated by them, and the EMPLOYEE confirms that such
information constitutes the exclusive property of the EMPLOYER. The EMPLOYEE
shall not otherwise knowingly act or conduct himself (a) to the material
detriment of the EMPLOYER, its subsidiaries, or affiliates, or (b) in a manner
which is inimical or contrary to the interests of the EMPLOYER.

8.       Nonassignability. Neither this AGREEMENT nor any right or interest
hereunder shall be assignable by the EMPLOYEE, his beneficiaries, or legal
representatives without the EMPLOYER's prior written consent; provided, however,
that nothing in this Section 8 shall preclude (a) the EMPLOYEE from designating
a beneficiary to receive any benefits payable hereunder upon his death, or (b)
the executors, administrators, or other legal representatives of the EMPLOYEE or
his estate from assigning any rights hereunder to the person or persons entitled
thereto.

9.       No Attachment. Except as required by law, no right to receive payment
under this AGREEMENT shall be subject to anticipation, commutation, alienation,
sale, assignment, encumbrance, charge, pledge or hypothecation or to execution,
attachment, levy, or similar process of assignment by operation of law, and any
attempt, voluntary or involuntary, to effect any such action shall be null, void
and of no effect.

10.      Indemnification; Insurance.

         (a) Indemnification. The EMPLOYER agrees to indemnify the EMPLOYEE and
his heirs, executors, and administrators to the fullest extent permitted under
applicable law and regulations, including, without limitation, 12 U.S.C. Section
1828(k), against any and all expenses and liabilities reasonably incurred by the
EMPLOYEE in connection with or arising out of any action, suit or proceeding in
which the EMPLOYEE may be involved by reason of his having been a director or
officer of the EMPLOYER or any of its subsidiaries, whether or not the EMPLOYEE
is a director or officer at the time of incurring any such expenses or
liabilities. Such expenses and liabilities shall include, but shall not be
limited to, judgments, court costs and attorney's fees and the cost of
reasonable settlements. The EMPLOYEE shall be entitled to indemnification in
respect of a settlement only if the Board of Directors of the EMPLOYER has
approved such settlement. Notwithstanding anything herein to the contrary, (i)
indemnification for expenses shall not extend to matters for which the EMPLOYEE
has been


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<PAGE>   7

terminated for JUST CAUSE, and (ii) the obligations of this Section 10
shall survive the TERM of this AGREEMENT. Nothing contained herein shall be
deemed to provide indemnification prohibited by applicable law or regulation.

         (b) Insurance. During the TERM, the EMPLOYER shall provide the EMPLOYEE
(and his heirs, executors, and administrators) with coverage under a directors'
and officers' liability policy, at the EMPLOYER's expense, at least equivalent
to such coverage provided to directors and senior officers of the EMPLOYER.

11.      Binding  Agreement. This AGREEMENT shall be binding upon, and inure to
the benefit of, the EMPLOYEE and the EMPLOYER and their respective permitted
successors and assigns.

12.      Amendment of AGREEMENT. This AGREEMENT may not be modified or amended,
except by an instrument in writing signed by the parties hereto.

13.      Waiver. No term or condition of this AGREEMENT shall be deemed to have
been waived, nor shall there be an estoppel against the enforcement of any
provision of this AGREEMENT, except by written instrument of the party charged
with such waiver or estoppels. No such written waiver shall be deemed a
continuing waiver, unless specifically stated therein, and each waiver shall
operate only as to the specific term or condition waived and shall not
constitute a waiver of such term or condition for the future or as to any act
other than the act specifically waived.

14.      Severability. If, for any reason, any provision of this AGREEMENT is
held invalid, such invalidity shall not affect the other provisions of this
AGREEMENT not held so invalid, and each such other provision shall, to the full
extent consistent with applicable law, continue in full force and effect. If
this AGREEMENT is held invalid or cannot be enforced, then any prior Agreement
between the EMPLOYER (or any predecessor thereof) and the EMPLOYEE shall be
deemed reinstated to the full extent permitted by law, as if this AGREEMENT had
not been executed.

15.      Headings. The headings of the paragraphs herein are included solely
for convenience of reference and shall not control the meaning or interpretation
of any of the provisions of this AGREEMENT.

16.      Governing Law; Regulatory Authority. This AGREEMENT has been executed
and delivered in the Commonwealth of Kentucky and its validity, interpretation,
performance and enforcement shall be governed by the laws of the Commonwealth of
Kentucky, except to the extent that federal law is governing. If this AGREEMENT
conflicts with any applicable federal law, including 12 C.F.R. Section 563.39,
as now or hereafter in effect, then federal law shall govern. References to the
OTS included herein shall include any successor primary federal regulatory
authority of the EMPLOYER.

17.      Effect of Prior Agreements. This AGREEMENT contains the entire
understanding between the parties hereto and supersedes any prior employment
agreement between the EMPLOYER or any predecessor of the EMPLOYER and the
EMPLOYEE.

18.      Notices. Any notice or other communication required or permitted
pursuant to this AGREEMENT shall be deemed delivered if such notice or
communication is in writing and is delivered personally or by facsimile
transmission or is deposited in the United States mail, postage prepaid,
addressed as follows:

         If to the EMPLOYER:

                  Columbia Federal Savings Bank
                  2497 Dixie Highway Fort
                  Mitchell, Kentucky 41017-3085
                  Attention: Chairman of the Board


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<PAGE>   8

         If to the EMPLOYEE:

                  Robert V. Lynch
                  306 Hazelwood Drive
                  Ft. Wright, Kentucky 41011



         IN WITNESS WHEREOF, the EMPLOYER has caused this AGREEMENT to be
executed by its duly authorized officer, and the EMPLOYEE has signed this
AGREEMENT, each as of the day and year first above written.


Attest:                                COLUMBIA FEDERAL SAVINGS BANK


___________________________________    By______________________________________



Attest:


____________________________________     ______________________________________
                                         Robert V. Lynch