SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549


                         ------------------------------

                                   FORM 10-QSB


[X]  QUARTERLY  REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES  EXCHANGE ACT
     OF 1934

     for the Quarterly Period Ended September 30, 2001

[ ]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

     for the Transition Period From ____________ to ____________

                        Commission File Number 333-72371

                         KENTUCKY NATIONAL BANCORP, INC.
--------------------------------------------------------------------------------
        (Exact name of Small Business Issuer as specified in its Charter)


INDIANA                                                          61-1345603
---------------------------------------------                -------------------
(State or other jurisdiction of organization)                   (IRS Employer
                                                             Identification No.)



1000 NORTH DIXIE AVENUE, ELIZABETHTOWN, KENTUCKY                        42701
------------------------------------------------                     ----------
(Address of principal executive offices)                             (Zip code)

Issuer's telephone number, including area code:   (270) 737-6000
                                                  --------------


     Check  whether  the issuer (1) filed all  reports  required  to be filed by
Section 13 or 15(d) of the Securities Exchange Act during the past 12 months (or
for such shorter  period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.

           X   Yes                        No
         -----                      -----


     As of September  30, 2001,  there were 248,920  shares of the  Registrant's
common stock, par value $.01 per share, outstanding.


     Transitional Small Business Issuer Disclosure Format (check one):

               Yes                     X   No
         -----                      ------

                                       1
<PAGE>

                        KENTUCKY NATIONAL BANCORP, INC.

                             ELIZABETHTOWN, KENTUCKY


                                      INDEX


                                                                            PAGE
                                                                            ----
PART I.
------

FINANCIAL INFORMATION

Item 1.

Consolidated Statements of Condition as of September 30, 2001
   and December 31, 2000 (Unaudited)                                          3

Consolidated Statements of Income - (Unaudited) for the
   three and nine months ended September 30, 2001 and 2000                    4

Consolidated Statements of Cash Flows - (Unaudited)
   for the nine months ended September 30, 2001 and 2000                      5

Notes to Consolidated Financial Statements (Unaudited)                        7


Item 2.

Management's Discussion and Analysis of Financial
     Condition and Results of Operations                                      11


PART II.
-------

OTHER INFORMATION

Item 6.   Exhibits and Reports on Form 8-K                                    15

Signatures                                                                    16


                                       2
<PAGE>

                         KENTUCKY NATIONAL BANCORP, INC.

                      CONSOLIDATED STATEMENTS OF CONDITION
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                          SEPTEMBER 30,            DECEMBER 31,
                                                                              2001                     2000
                                                                         -------------             -----------
<S>                                                                      <C>                       <C>
                               ASSETS

Cash and due from banks                                                  $ 1,491,554               $ 1,574,759
Federal funds sold                                                         3,237,000                   304,000
Investment securities:
  Securities available-for-sale                                            3,423,535                 3,305,870
  Securities held-to-maturity, at fair value                                 176,650                   152,300
Loans held for sale                                                          461,019                   258,535
Loans, net                                                                62,794,002                58,079,886
Premises and equipment                                                     2,126,476                 1,924,511
Accrued interest receivable and other assets                                 930,619                   901,432
                                                                         -----------               -----------

     Total assets                                                        $74,640,855               $66,501,293
                                                                         ===========               ===========

                LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:
  Deposits                                                               $61,062,312               $58,675,405
  Federal Home Loan Bank advances                                          5,000,000                      --
  Obligations under capital leases                                         1,225,261                 1,260,482
  Accrued interest payable and other
    liabilities                                                              873,207                   631,713
                                                                         -----------               -----------

     Total liabilities                                                    68,160,780                60,567,600
                                                                         -----------               -----------
Stockholders' equity:
  Preferred stock, $.01 par value;
    authorized 1,000,000 shares                                                 --                        --
  Common stock, $.01 par value;
    authorized 5,000,000 shares; issued and
    outstanding, 248,920 and 246,440 shares
    at September 30, 2001 and December 31,
    2000, respectively                                                         2,489                     2,464
  Surplus                                                                  5,526,903                 5,441,528
  Retained earnings                                                          902,693                   476,241
  Accumulated other comprehensive income                                      47,990                    13,460
                                                                         -----------               -----------

     Total stockholders' equity                                            6,480,075                 5,933,693
                                                                         -----------               -----------

Commitments and contingent liabilities                                          --                        --
                                                                         -----------               -----------

     Total liabilities and stockholders'
       equity                                                            $74,640,855               $66,501,293
                                                                         ===========               ===========
</TABLE>

                 See notes to consolidated financial statements.


                                       3
<PAGE>
                         KENTUCKY NATIONAL BANCORP, INC.
                        CONSOLIDATED STATEMENTS OF INCOME

         FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                              THREE MONTHS ENDED         NINE MONTHS ENDED
                                                SEPTEMBER 30,               SEPTEMBER 30,
                                           -----------------------    ------------------------
                                              2001         2000          2001          2000
                                           ----------   ----------    ----------    ----------
<S>                                       <C>           <C>           <C>           <C>
Interest income:
  Loans, including fees                   $ 1,476,969   $ 1,320,736   $ 4,456,485   $ 3,731,264
  Securities                                   53,779        57,065       168,404       166,379
  Federal funds sold                           46,059        26,729       116,327        63,057
                                          -----------   -----------   -----------   -----------
     Total interest income                  1,576,807     1,404,530     4,741,216     3,960,700
                                          -----------   -----------   -----------   -----------

Interest expense:
  Deposit accounts                            525,048       525,589     1,644,427     1,416,985
  Certificates of deposit over $100,000       250,691       232,102       782,408       641,006
  Interest expense - federal funds               --            --            --           1,187
  Interest expense - FHLB advances             61,447          --         159,535          --
  Interest expense - capital lease             32,725        33,251        98,576       100,134
                                          -----------   -----------   -----------   -----------

     Total interest expense                   869,911       790,942     2,684,946     2,159,312
                                          -----------   -----------   -----------   -----------

     Net interest income                      706,896       613,588     2,056,270     1,801,388

Provision for loan losses                      46,000        55,200       136,800       162,372
                                          -----------   -----------   -----------   -----------
     Net interest income after
       provision for loan losses              660,896       588,388     1,919,470     1,639,016
                                          -----------   -----------   -----------   -----------

Other income:
  Service charges and fees                    144,069       100,737       376,335       266,003
  Net gain on sale of loans                    48,132          --         122,844          --
  Credit life and accident insurance            5,604         7,647        17,748        42,894
                                          -----------   -----------   -----------   -----------

                                              197,805       108,384       516,927       308,897
                                          -----------   -----------   -----------   -----------

Other expenses:
  Salaries and employee benefits              315,671       272,167       898,564       763,897
  Net occupancy expense                        46,679        33,271       121,466       103,442
  Advertising                                  25,953        28,454        72,773        88,612
  Data processing                              56,266        67,910       153,858       159,566
  Postage, telephone and supplies              34,465        26,517       100,936        84,162
  Bank franchise tax                           20,148        17,664        59,387        50,812
  Directors fees                               15,088        15,088        47,096        36,108
  Professional services                        28,150        49,124        94,850       170,799
  Other operating expenses                     87,292        87,073       241,372       209,308
                                          -----------   -----------   -----------   -----------
                                              629,712       597,268     1,790,302     1,665,706
                                          -----------   -----------   -----------   -----------
Income before income taxes                    228,989        69,504       646,095       282,207

Income tax expense (benefit)                   76,443        20,561       219,642      (223,800)
                                          -----------   -----------   -----------   -----------
Net income                                $   152,546   $    48,943   $   426,453   $   506,007
                                          ===========   ===========   ===========   ===========

Earnings per share
    Basic                                 $      0.61   $      0.20   $      1.72   $      2.08
                                          ===========   ===========   ===========   ===========

    Diluted                               $      0.61   $      --     $      1.70   $      --
                                          ===========   ===========   ===========   ===========
</TABLE>
                 See notes to consolidated financial statements.

                                       4
<PAGE>
                         KENTUCKY NATIONAL BANCORP, INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

              FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                                        NINE MONTHS ENDED
                                                          SEPTEMBER 30,
                                                    --------------------------
                                                        2001          2000
                                                    -----------    -----------
<S>                                                 <C>            <C>
Operating activities:
     Net income                                     $   426,453    $   506,007
     Adjustments to reconcile net income to net
              cash provided (used) by operating
              activities:
         FHLB stock dividend                            (16,900)       (12,400)
         Provision for loan losses                      136,800        162,372
         Provision for depreciation, amortization
           and accretion, net                            98,490         78,782
         Incentive stock option compensation             23,400         59,800
         Deferred tax                                     2,855       (223,800)
         Change in assets and liabilities:
              Loans held for sale                      (202,484)          --
              Accrued interest receivable
               and other assets                         (49,830)      (206,532)
              Accrued interest payable                  303,494        245,678
                                                    -----------    -----------
                  Net cash provided by
                    operating activities                722,278        609,907
                                                    -----------    -----------
Investing activities:
     Activity in available-for-sale securities:
          Purchases                                     (48,448)    (1,101,019)
     Activity in held-to-maturity securities:
          Maturities, prepayments and calls                --           27,700
          Purchases                                     (24,350)          --
     Net increase in loans                           (4,850,916)    (7,809,293)
     Purchases of premises and equipment               (300,455)       (37,507)
                                                    -----------    -----------
                  Net cash used in investing
                    activities                       (5,224,169)    (8,920,119)
                                                    -----------    -----------
Financing activities:
     Net increase in deposits                         2,386,907      8,409,002
     Payments on capital lease obligations              (35,221)       (34,353)
     Net increase in Federal Home Loan advances       5,000,000           --
                                                    -----------    -----------
                  Net cash provided by financing
                    activities                        7,351,686      8,374,649
                                                    -----------    -----------
Net increase in cash and cash
  equivalents                                         2,849,795         64,437

Cash and cash equivalents, beginning of period        1,878,759      2,925,188
                                                    -----------    -----------

Cash and cash equivalents, end of period            $ 4,728,554    $ 2,989,625
                                                    ===========    ===========

SUPPLEMENTAL DISCLOSURES:

Cash paid for interest                              $ 2,721,436    $ 2,040,589
                                                    ===========    ===========
Federal Home Loan Bank Stock dividend
   received                                         $    16,900    $    12,400
                                                    ===========    ===========
Total increase (decrease) in unrealized
   gain on securities available-for-sale            $    52,317    $   (19,544)
                                                    ===========    ===========
</TABLE>
                 See notes to consolidated financial statements.

                                       5
<PAGE>



                         KENTUCKY NATIONAL BANCORP, INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

              FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
                                   (UNAUDITED)



NONCASH TRANSACTIONS:
During the nine month period ended  September 30, 2001, the Company issued 2,480
shares of common stock in lieu of cash payment for accrued  directors'  fees for
the year ended  December 31, 2000 in the amount of $62,000 in accordance  with a
deferred compensation plan approved by the stockholders on April 25, 2000.


                                       6
<PAGE>

                         KENTUCKY NATIONAL BANCORP, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

1.   BASIS OF PRESENTATION

     The unaudited  consolidated  financial  statements  include the accounts of
     Kentucky National Bancorp, Inc., and its subsidiary Kentucky National Bank.
     All material intercompany balances and transactions have been eliminated in
     consolidation.

     The accompanying  unaudited consolidated financial statements were prepared
     in  accordance  with  instructions  for Form 10-QSB and  therefore,  do not
     include  all  disclosures  necessary  for a  complete  presentation  of the
     statement of financial condition, statement of income and statement of cash
     flows in conformity with generally accepted accounting principles. However,
     all adjustments (all of which are of a normal recurring  nature) which are,
     in the opinion of management,  necessary for the fair  presentation  of the
     interim  financial  statements have been included.  The statement of income
     for periods  presented is not  necessarily  indicative of the results which
     may be expected for the entire year.

2.   COMPREHENSIVE INCOME

     At  September  30, 2001 and December  31,  2000,  the Bank held  securities
     classified  as  available-for-sale,  which  have  net  unrealized  gains of
     $72,712 and $20,394,  respectively. The before and after tax amount and tax
     expense of this component of comprehensive income at September 30, 2001 and
     December 31, 2000 is summarized below:
<TABLE>
<CAPTION>
                                                              BEFORE              TAX                  AFTER
                                                                TAX              EXPENSE                TAX
                                                            ---------           ---------            ---------
<S>                                                         <C>                 <C>                  <C>
    SEPTEMBER 30, 2001
       Unrealized holding gains                             $  52,317           $  17,787            $  34,530
       Reclassification adjustment
         for gains included in net
         income                                                  --                  --                   --
                                                            ---------           ---------            ---------

                                                            $  52,317           $  17,787            $  34,530
                                                            =========           =========            =========

     DECEMBER 31, 2000
       Unrealized holding gains                             $  33,909           $  11,529            $  22,380
       Reclassification adjustment
         for gains included in net
         income                                                  --                  --                   --
                                                            ---------           ---------            ---------

                                                            $  33,909           $  11,529            $  22,380
                                                            =========           =========            =========
</TABLE>

3.   FEDERAL HOME LOAN BANK ADVANCES

     During 1999,  the Bank entered into a blanket  agreement  for advances with
     the Federal  Home Loan Bank  (FHLB).  The Bank had  $5,000,000  in advances
     outstanding  at September 30, 2001 and no advances  outstanding at December
     31, 2000.  Advances from FHLB are payable at maturity with interest payable
     monthly, and are summarized as follows:


                                       7
<PAGE>

                         KENTUCKY NATIONAL BANCORP, INC.

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued
                                   (UNAUDITED)

3. FEDERAL HOME LOAN BANK ADVANCES, CONTINUED
<TABLE>
<CAPTION>
                                                              INTEREST          SEPTEMBER 30,   DECEMBER 31,
                                            MATURITY            RATE               2001             2000
                                            --------          --------          ----------      ------------

     <S>                                    <C>               <C>               <C>              <C>
     Long-term Borrowings                   1/19/11           5.44%             $2,000,000             -
                                            1/24/11           4.60%              1,000,000             -
                                            3/09/11           5.22%              1,000,000             -
                                            3/14/11           4.22%              1,000,000             -
                                                                                ----------       ----------

                                                                                $5,000,000             -
                                                                                ==========       ==========
</TABLE>

     Mortgage  loans and all FHLB stock are pledged to the FHLB as collateral on
     advances.

4.   EARNINGS PER SHARE

     Earnings per share has been  determined  in accordance  with  Statements of
     Financial  Accounting Standards No. 128, "Earnings per Share." Earnings per
     common and common  equivalent share were computed by dividing net income by
     the weighted average number of shares of common stock outstanding.  Diluted
     earnings  per  share  for the  nine  months  ended  September  30,  2001 is
     determined by dividing net income by the weighted  average number of shares
     of common stock outstanding plus the weighted average number of shares that
     would be issued upon exercise of the dilutive stock-based compensation plan
     assuming  proceeds  are used to purchase  shares  pursuant to the  treasury
     stock  method.  Diluted  earnings  per share does not include the effect of
     outstanding options to purchase 40,000 and 16,000 shares of common stock in
     2001 and 2000 respectively as their effect is antidilutive.

     The  following  data show the amounts used in computing  earnings per share
     (EPS) and the effect on income and the weighted average number of shares of
     dilutive potential common stock at September 30, 2001 and 2000.
<TABLE>
<CAPTION>
                                                                         SEPTEMBER 30,             SEPTEMBER 30,
                                                                             2001                      2000
                                                                       -----------------         -----------------
             <S>                                                       <C>                       <C>
             Income  available to common  stock-  holders used in
             basic and diluted   EPS                                       $426,453                  $506,007
                                                                       =================         =================
             Weighted  average  number of common  shares  used in
             basic EPS                                                      248,300                   243,578
                                                                       =================         =================
             Effect of dilutive securities:
               Stock-based compensation plan                                  1,884                    na

                                                                       =================         =================
             Weighted number of common shares and dilutive
             potential common stock used in dilutive EPS                    250,184                    na
                                                                       =================         =================
</TABLE>

                                       8
<PAGE>
                         KENTUCKY NATIONAL BANCORP, INC.

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued
                                   (UNAUDITED)

5.   RECLASSIFICATIONS

     Certain  2000  amounts  have been  reclassified  to  conform  with the 2001
     presentation.

6.   LEASE COMMITMENT

     The related party from which the Bank leases its main office facilities has
     completed  construction  of expansion of that facility.  The Bank is in the
     process of  finalizing  lease  arrangements  and  expects to combine  these
     leasing arrangements with existing related party lease arrangements for the
     main office facility.  Construction and land costs of the related party for
     the new expansion were approximately  $925,000 and $120,000,  respectively.
     Finalization of the lease  arrangements  will result in additional  monthly
     lease  payments of $10,500.  The  recordation  of  additional  premises and
     obligations  under capital leases of approximately  $925,000 will result in
     increased  monthly   amortization  of  premises  under  capital  leases  of
     approximately $1,900.  Monthly operating lease rental expense for land will
     increase  approximately  $1,200 per month.  The Bank occupied the expansion
     facilities in September,  2001 and accrued $10,500 for expected costs under
     the anticipated  finalized lease arrangements in September,  2001. The Bank
     expended   approximately  $300,000  for  equipment  in  the  quarter  ended
     September  30,  2001 to  furnish  the  expansion  facilities  resulting  in
     additional monthly depreciation expense of $4,200 in September, 2001.

7.   INCOME TAXES

     The Company and the Bank file a consolidated income tax return. The Bank is
     charged or credited the amount equal to the income tax that would have been
     applicable on a separate return basis.

     The components of consolidated  income tax expense (benefit)  applicable to
     continuing operations for the nine months ended September 30, 2001 and 2000
     were as follows:
<TABLE>
<CAPTION>
                                                                       SEPTEMBER 30,    SEPTEMBER 30,
                                                                           2001           2000
                                                                       ------------     ---------
           <S>                                                           <C>             <C>
           Current                                                       $242,500        $   --
           Deferred                                                       (22,900)        (233,800)
                                                                         --------        ---------

                                                                         $219,600        $(233,800)
                                                                         ========        =========
</TABLE>

     Deferred   income  tax  assets  net  of  deferred  tax   liabilities   were
     approximately  $191,000 and $185,900 at September 30, 2001 and December 31,
     2000,   respectively.   Such  amounts  are  included  in  accrued  interest
     receivable and other assets in the accompanying balance sheet. At September
     30, 2001 and December  31, 2000  deferred  tax assets and  liabilities  are
     composed of the following:
<TABLE>
<CAPTION>
                                                                        SEPTEMBER 30,   DECEMBER 31,
                                                                            2001           2000
                                                                       -------------    -----------
<S>                                                                    <C>              <C>
             Deferred tax assets:
               Allowance for loan losses                               $   205,100      $   156,900
               Startup costs                                                21,600           35,500
               Organization costs                                           14,400           25,100
               Stock options                                                46,800           38,900
                                                                       -----------      -----------
                                                                           287,900          256,400
                                                                       -----------      -----------
</TABLE>
                                       9
<PAGE>
                         KENTUCKY NATIONAL BANCORP, INC.

              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued
                                   (UNAUDITED)



7. INCOME TAXES, CONTINUED

             Deferred tax liabilities:
               Federal Home Loan Bank stock             (15,500)         (9,800)
               Accumulated depreciation                 (56,700)        (53,800)
               Available-for-sale securities            (24,700)         (6,900)
                                                    -----------     -----------
                                                        (96,900)        (70,500)
                                                    -----------     -----------

             Net deferred tax asset                 $   191,000     $   185,900
                                                    ===========     ===========


     The provision for federal tax expense  differs from the amount  computed by
     applying the U.S.  federal  income tax rate of 34 percent to income  before
     income taxes as a result of the following:
<TABLE>
<CAPTION>
                                                                       SEPTEMBER 30,          SEPTEMBER 30,
                                                                           2001                   2000
                                                                       ------------           -------------

<S>                                                                    <C>                       <C>
             U.S. federal income tax                                   $   219,700               $    --
             Changes from statutory tax:
               Other, net                                                     (100)                   --
                                                                       -----------               ----------
             Income tax expense                                        $   219,600               $    --
                                                                       ===========               ==========
</TABLE>


                                       10
<PAGE>
ITEM 2.

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS

GENERAL

The following discussion and analysis is intended to assist in understanding the
consolidated financial condition and results of operations of the Company.

FORWARD-LOOKING STATEMENTS

When used in this  discussion  and  elsewhere in this  Quarterly  Report on Form
10-QSB,  the words or phrases  "will likely  result,"  "are  expected  to," will
continue," "is anticipated,"  "estimate,"  "project," or similar expressions are
intended  to  identify  "forward-looking  statements"  within the meaning of the
Private  Securities  Litigation Reform Act of 1995. The Company cautions readers
not to place undue reliance on any such forward-looking statements,  which speak
only as of the date made, and advises  readers that various  factors,  including
regional  and  national  economic  conditions,  substantial  changes in level of
market  interest  rates,  credit  and  other  risks of  lending  and  investment
activities and  competitive  and  regulatory  factors could affect the Company's
financial  performance  and could cause the Company's  actual results for future
periods to differ materially from those anticipated or projected.

The Company does not undertake  and  specifically  disclaims  any  obligation to
update any  forward-looking  statements to reflect  occurrence of anticipated or
unanticipated events or circumstances after the date of such statements.

COMPARISON OF THE RESULTS OF OPERATIONS FOR THE THREE AND NINE MONTH PERIODS
ENDED SEPTEMBER 30, 2001 AND 2000

NET INCOME.  Net income for the quarter ended September 30, 2001 was $152,500 or
$0.61 per  diluted  share  compared to a net income of $48,900 or $.20 per share
for the same period last year, an increase of $103,600 or $0.41 per share.  Year
to date net income at September 30, 2001 was $426,500 or $1.70 per diluted share
compared  to net income of  $506,000  or $2.08 per share for the same  period in
2000.

Income  before  income taxes for the three and nine months ended  September  30,
2001 was $229,000 and $646,100,  respectively,  compared to $69,500 and $282,200
for the same  periods last year,  an increase of $159,500  (229.5%) and $363,900
(129.0%),  respectively. The increases in pre-tax income were due to an increase
in net interest  income of $93,300 and $254,900,  an increase in other income of
$89,400 and $208,000 and a decrease in the  provision  for loan losses of $9,200
and  $25,600.  These  increases  were  partially  offset by  increases  in other
expenses of $32,400  and  $124,600.  The overall  decrease in net income for the
nine months  ended at September  30, 2001  compared to the same period last year
was due largely to the  recording  of income tax expense of $219,600  during the
2001 period as compared to an income tax benefit of $223,800 for the same period
last  year.   During  the  year  ended  December  31,  2000,  the  Company  used
approximately $320,000 in tax loss carryforwards to offset taxable income.

NET INTEREST INCOME.  Net interest income increased $93,300 or 15.2% to $706,900
for the three months ended September 30, 2001 compared to $613,600 for the three
months  ended  September  30, 2000.  Year to date net  interest  income was $2.1
million and $1.8 million for the nine months ended  September 30, 2001 and 2000,
respectively,  an increase of $254,900 or 14.2% between  periods.  This increase
reflects  the  continued  growth  in  interest-earning   assets.  Total  average
interest-earning  assets for the nine months ended  September 30, 2001 increased
by  approximately  $12.2  million  with a decrease in average  yield of 14 basis
points, while average  interest-bearing  liabilities  increased by approximately
$11.2 million with an increase in average costs of approximately 7 basis points.
The decrease in yield on assets for the period ending  September 31, 2001 is due
to lower market  rates  generally  with a sharp  decline in the yield on federal
funds sold.  The  increase  in the Bank's cost of funds  reflects an increase in
24-

                                       11
<PAGE>

month certificates of deposits which the Bank marketed  aggressively  during the
second and third  quarters of 2000 to fund the  growing  loan  portfolio.  These
certificates  of deposit bore  interest at rates  between  6.75% to 7.25%.  As a
result of these changes,  the Bank's interest rate spread decreased to 3.21% for
the nine months ended  September  30, 2001 compared to 3.42% for the nine months
ended  September 30, 2000. Net interest  margin  decreased to 3.96% for the 2001
period compared to 4.21% for the 2000 period.

PROVISION FOR LOAN LOSSES. The provision for loan losses was $46,000 and $55,200
for the quarters ended  September 30, 2001 and 2000,  respectively.  The year to
date  provision  for loan losses was  $136,800  and $162,400 for the nine months
ended September 30, 2001 and 2000,  respectively.  The Bank makes provisions for
loan  losses in  amounts  deemed  necessary  to  maintain  the  adequacy  of the
allowance for loan losses.  At September 30, 2001, the Bank's allowance for loan
losses was $737,700 or 1.17% of the gross loan portfolio.

OTHER  INCOME.  Other income was  $197,800  and $108,400 for the quarters  ended
September  30,  2001 and  2000,  respectively.  Year to date  other  income  was
$516,900 and $308,900  for the nine months  ended  September  30, 2001 and 2000,
respectively.  The increase for the quarter of $89,400 or 82.5% is reflective of
the  continued  growth of loans and  deposits  and the net gain on sale of loans
from the addition of the secondary  market loan division in October,  2000.  The
Bank's  secondary market  activities  benefited from a decline in interest rates
during 2001 which triggered a wave of refinancing.

OTHER  EXPENSE.  Other expense was $629,700 and $597,300 for the quarters  ended
September 30, 2001 and 2000,  respectively.  Year to date other expense was $1.8
million and $1.7 million for the nine months ended  September 30, 2001 and 2000,
respectively.  The increases for the quarter of $32,400 or 5.4% and for the year
to date of $124,600 or 7.5% were due  primarily  to  increases  in salaries  and
employee  benefits of $43,500 for the quarter and  $134,700  for the  nine-month
period. The growth in salaries and benefits is the result of bank growth and the
addition of the secondary  market loan division in October,  2000. The growth in
salaries and benefits was partially offset by a decline in professional services
expense as the Bank has sought to reduce its reliance on outside professionals.

INCOME TAX BENEFIT  (EXPENSE).  Income tax expense was $76,400 and  $219,600 for
the three and nine months ended September 30, 2001, compared to a tax expense of
$20,600 for the quarter  ended  September 30, 2000 and a tax benefit of $223,800
for the nine months ended  September 30, 2000.  The tax benefit  during the 2000
period related to the reversal of valuation  allowances  related to net deferred
tax  assets.  During  the  year  ended  December  31,  2000,  the  Company  used
approximately  $320,000 in tax loss  carryforwards to offset taxable income. The
Company  provides  for  both  the  current  and  deferred  tax  effects  of  the
transactions  reported in its financial  statements and established deferred tax
assets and  liabilities  for the  temporary  differences  between the  financial
reporting  and tax bases of its assets and  liabilities.  The Company,  however,
establishes  valuation  allowances  for its net deferred tax assets unless it is
more likely than not that these net deferred tax assets will be realized. During
the nine months ended September 30, 2000, the Company had a valuation  allowance
for its net  deferred  tax  assets.  Based on its  current  earnings  and  other
factors,  the Company  determined that it was more likely than not that it would
realize  certain of its net deferred  tax assets and reversed the  corresponding
valuation allowance during the nine months ended September 30, 2000.

COMPARISON OF FINANCIAL CONDITION AT SEPTEMBER 30, 2001 AND DECEMBER 31, 2000

The Bank continued to experience  strong asset growth during 2001.  Total assets
have  increased  $8.1  million,  or 12.2% to $74.6 million at September 30, 2001
compared to $66.5 million at December 31, 2000. The increase in total assets was
primarily  attributable to a $4.9 million or 8.4% increase in the loan and loans
held for sale portfolios. Also contributing to the increase in assets was a $2.9
million  increase  in  federal  funds  sold as the Bank has  sought  to  improve
liquidity.  Funding for the Bank's asset growth came  primarily  from  increased
deposits and advances from the Federal Home Loan Bank of Cincinnati  (FHLB).  At
September 30, 2001,  deposits  totaled $61.1 million,  a $2.4 million,  or 4.1%,
increase  over  deposits at December 31, 2000.  Advances  from FHLB totaled $5.0


                                       12
<PAGE>
million compared to no advances outstanding at December 31, 2000.

Stockholders'  equity  increased by $546,382 to $6,480,075 at September 30, 2001
from  $5,933,693 at December 31, 2000. Net income for the period of $426,500 and
a $57,900 increase in unrealized gain or loss on  available-for-sale  securities
and net  surplus  from  stock  options  accrued  are the  major  sources  of the
increase.  The remaining increase of $62,000 during the current period is due to
the issuance of 2,480 shares of common stock in lieu of cash payment for accrued
directors'  fees for the year  ended  December  31,  2000 in  accordance  with a
deferred  compensation  plan  approved by the  stockholders  on April 25,  2000.
Management   believes  that  a  strong  capital  position  is  vital  to  future
profitability  and to  promote  depositor  and  investor  confidence.  The  Bank
continues  to  be  in  compliance   with  all  applicable   regulatory   capital
requirements.

ASSET QUALITY

The following table sets forth information  regarding the Bank's  non-performing
assets at the dates indicated.
<TABLE>
<CAPTION>
                                                   SEPTEMBER 30,  DECEMBER 31,
                                                        2001          2000
                                                   ------------   ------------
         <S>                                          <C>          <C>
         Restructured loans                           $   --       $   --
         Non-accrual loans                             716,000      225,000
         Accruing loans past due 90 days or more          --           --
                                                      --------     --------

                 Total                                $716,000    $225,000
                                                      ========    ========
</TABLE>
At September 30, 2001, there were no loans outstanding not reflected in the
above table as to which known information about possible credit problems of
borrowers caused management to have serious doubts as to the ability of such
borrowers to comply with present loan repayment terms.

An analysis of the changes in the allowance for loan losses is as follows:
<TABLE>
<CAPTION>
                                                      NINE MONTHS ENDED
                                                        SEPTEMBER 30,
                                                 -------------------------
                                                    2001           2000
                                                 ----------     ----------
         <S>                                     <C>            <C>
         Balance, beginning of period            $  625,556     $  561,944

         Loans charged off                          (46,535)      (169,308)
         Loan recoveries                             21,878          7,369
                                                 ----------     ----------
         Net charge-offs                            (24,657)      (161,939)

         Provision for loan losses                  136,800        162,372
                                                 ----------     ----------
         Balance, end of period                  $  737,699     $  562,377
                                                 ==========     ==========
</TABLE>
LIQUIDITY AND CAPITAL RESOURCES

The Company currently has no operating business other than the Bank and does not
have material  funding needs.  In the future,  the Company may require funds for
dividends  and tax  payments  for  which it will  rely on  dividends  and  other
distributions  from  the  Bank.  The  Bank  is  subject  to  various  regulatory
restrictions on the payment of dividends.

The Bank's  sources of funds for lending  activities and operations are deposits
from its primary  market  area,  funds  raised in its initial  public  offering,
advances from the FHLB of Cincinnati,  principal and interest payments on loans,
interest  received  on  other  investments  and  federal  funds  purchased.  Its
principal  funding  commitments are for the origination of loans, the payment of
maturing
                                       13
<PAGE>

deposits, principal and interest payments on advances from FHLB, and obligations
under  capital  leases for buildings and  equipment.  Deposits are  considered a
primary source of funds supporting the Bank's lending and investment activities.

At September 30, 2001, the Bank's ratio of loans to deposits was 103.6% compared
to 99.4% at December 31, 2000. The loan-to-deposit ratio is used as an indicator
of a bank's ability to originate  additional  loans and general  liquidity.  The
Bank's comparatively high loan-to-deposit  ratio reflects  management's emphasis
on  building  the loan  portfolio  and the use of FHLB  advances  to  supplement
deposits.  Because  the Bank's  continued  loan  growth  will  depend on deposit
growth,  management  expects to place more emphasis on building liquidity on the
balance  sheet and that the  loan-to-deposit  ratio  will  decline.  The  Bank's
strategies in this regard  include the sale of  participations  in loans and the
creation of an investment  securities  portfolio that can be used as a source of
liquidity and earnings.

Kentucky National Properties,  L.L.C., a limited liability company controlled by
the Company's directors, has completed construction of an addition to the Bank's
main  office  facility.   The  Bank  is  in  the  process  of  finalizing  lease
arrangements  and expects to combine  these leasing  arrangements  with existing
related party lease arrangements for the main office facility.  Construction and
land  costs  of the  related  party  for the new  expansion  were  approximately
$925,000 and $120,000, respectively. Finalization of the lease arrangements will
result in  additional  monthly lease  payments of $10,500.  The  recordation  of
additional  premises  and  obligations  under  capital  leases of  approximately
$925,000 will result in increased monthly amortization of premises under capital
leases of approximately $1,900.  Monthly operating lease rental expense for land
will increase  approximately  $1,200 per month.  The Bank occupied the expansion
facilities in September,  2001 and accrued  $10,500 for expected costs under the
anticipated  finalized lease arrangements in September,  2001. The Bank expended
approximately  $300,000 for equipment in the quarter ended September 30, 2001 to
furnish the expansion  facilities  resulting in additional monthly  depreciation
expense of $4,200 in September, 2001.

The Bank's most liquid assets are cash and cash  equivalents,  which are cash on
hand,  amounts due from  financial  institutions,  federal  funds sold and money
market  mutual  funds.  The levels of such  assets are  dependent  on the Bank's
operating, financing and investment activities at any given time. The variations
in levels of cash and cash  equivalents  are  influenced  by  deposit  flows and
anticipated future deposit flows.

Cash and cash  equivalents  (cash due from banks,  interest-bearing  deposits in
other financial institutions, and federal funds sold), as of September 30, 2001,
totaled $4.7 million  compared to $3.0 million at September 30, 2000. The Bank's
cash flows were provided mainly by financing activities,  including $2.4 million
from net deposit  increases  and $5.0  million  from FHLB  advances.  During the
quarter  ended  September  30, 2001,  the Bank had  purchases  of furniture  and
equipment for the new addition totaling $300,000.  Operating activities provided
$722,300  in cash for the nine  months  ended  September  30,  2001  compared to
$609,900 provided in cash for the nine months ended September 30, 2000. The Bank
used cash flows for its  investing  activities  primarily to fund an increase in
gross loans of $4.9 million.

As a national bank, the Bank is subject to regulatory  capital  requirements  of
the  Office of the  Comptroller  of the  Currency  ("OCC").  In order to be well
capitalized  under OCC  regulations,  the Bank must maintain a leverage ratio of
Tier I Capital to  average  assets of at least 5% and ratios of Tier I and total
capital  to  risk-weighted  assets of at least 6.0% and 10.0%  respectively.  At
September  30,  2001,   the  Bank   satisfied  the  capital   requirements   for
classification as well capitalized under OCC regulations.

                                       14
<PAGE>

PART II
                                OTHER INFORMATION

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K
         --------------------------------

     (a)  The following  exhibits are either being filed with or incorporated by
          reference in this quarterly report on Form 10-QSB:

          NUMBER       DESCRIPTION
          ------       -----------

          3.1         Articles of Incorporation *
          3.2         Bylaws *
          4           Form of Common Stock Certificate *
          10.1        Restrictive Stock Transfer Agreement *
          10.2        Organizational Stock Option and Incentive Plan **
          10.3        Lease Agreement Between Kentucky National   Properties,
                      L.L.C and Kentucky National Bank *
          10.4        Kentucky National Bancorp, Inc. 2000 Stock Option and
                      Incentive Plan ***
          10.5        Kentucky National Bancorp, Inc. Director Fee Deferral
                      Plan ****

                      -------------
                       *        Incorporated by reference from the registrant's
                                Registration Statement on Form S-4
                                (File No. 333-72371).
                       **       Incorporated by reference from Registrant's
                                Post- Effective  Amendment No. 1 to
                                Registration Statement on Form S-8
                                (File No. 333-72371).
                       ***      Incorporated by reference from the
                                registrant's Annual Report on Form 10-KSB
                                for the year ended December 31, 1999.
                       ****     Incorporated by reference from Registrant's
                                Registration Statement on Form S-8
                                (File No. 333-41676).


     (b)  During the quarter ended  September 30, 2001, the Company did not file
          any current reports on Form 8-K.

                                       15

<PAGE>


                                   SIGNATURES


In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.



                                          KENTUCKY NATIONAL BANCORP, INC.


Date: November 13, 2001                   By: /s/ Ronald J. Pence
                                              -------------------------------
                                              Ronald J. Pence, President
                                              (Duly Authorized Represen-
                                               tative and Principal
                                               Financial Officer)


                                       16