SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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





(Mark One)
|X|   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
      SECURITIES EXCHANGE ACT OF 1934

      For the quarterly period ended December 31, 1996.


                                       OR

|_|   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
      SECURITIES EXCHANGE ACT OF 1934


Commission File Number: 0-26570


                    Harrodsburg First Financial Bancorp, Inc.
                   ------------------------------------------
             (Exact name of registrant as specified in its charter)

         Delaware                                              61-1284899
--------------------------------                           -------------------
(State or other jurisdiction of                             (I.R.S. Employer
 incorporation or organization)                             Identification No.)

104 South Chiles Street, Harrodsburg, Kentucky                  40330-1620
----------------------------------------------             -------------------
(Address of principal executive offices)                        (Zip Code)

Registrant's telephone number, inclu(606) 734-5452:

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 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 ninety days.       Yes   X         No
                                                  ---           ---

As of February 10, 1997,  1,864,736 shares of the registrant's common stock were
issued and outstanding.

Page 1 of 17 Pages                                    Exhibit Index at Page  N/A
                                                                             ---


<PAGE>



                                    CONTENTS

                               ------------------
<TABLE>
<CAPTION>


PART I.   FINANCIAL INFORMATION

<S>       <C>                                                                       <C>
Item 1.   Financial Statements

          Consolidated Balance Sheets as of December 31, 1996 (unaudited) and
                September 30, 1996...................................................3

          Consolidated Statements of Income for the Three-Month Periods Ended
                December 31, 1996 and 1995 (unaudited)...............................4

          Consolidated Statements of Cash Flows for the Three Month Periods Ended
                December 31, 1996 and December 31, 1995 (unaudited)..................5

          Notes to Consolidated Financial Statements.................................7

Item 2.   Management's Discussion and Analysis of Financial Condition and
                Results of Operations................................................9


PART II.  OTHER INFORMATION

Item 1.   Legal Proceedings.........................................................14
Item 2.   Changes in Securities.....................................................14
Item 3.   Defaults Upon Senior Securities...........................................14
Item 4.   Submission of Matters to a Vote of Security Holders.......................14
Item 5.   Other Information.........................................................14
Item 6.   Exhibits and Reports on Form 8-K......................................... 14

SIGNATURES

</TABLE>


                                        2

<PAGE>



            HARRODSBURG FIRST FINANCIAL BANCORP, INC. AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEETS

                               ------------------
<TABLE>
<CAPTION>
                                                                          As of            As of
                                                                       December 31,     September 30,
ASSETS                                                                     1996             1996
                                                                       ------------     -----------

                                                                        (unaudited)
<S>                                                                  <C>              <C>          
Cash and due from banks                                              $     586,822    $     834,621
Interest Bearing Deposits                                               11,715,429       14,230,056
Certificates of deposit                                                  1,500,000        2,500,000
Available-for-sale securities                                            2,127,147        1,881,429
Held-to-maturity securities                                             11,017,871       10,502,766
Loans receivable, net                                                   78,793,866       77,502,336
Accrued interest receivable                                                598,052          675,433
Premises and equipment, net                                                652,147          657,920
Other assets                                                                59,367          168,113
                                                                     -------------    -------------

   Total assets                                                      $ 107,050,701    $ 108,952,674
                                                                     =============    =============

LIABILITIES AND STOCKHOLDERS' EQUITY

Deposits                                                             $  77,412,985    $  76,946,210
Advance payments by borrowers for taxes and insurance                       25,754           68,534
Income taxes payable                                                       936,247          719,402
Dividends payable                                                          391,633
Other liabilities                                                           40,121          604,906
                                                                     -------------    -------------
   Total liabilities                                                    78,415,107       78,730,685
                                                                     -------------    -------------

Stockholders' equity
   Common stock, $0.10 per value, 5,000,000 shares authorized;
       2,182,125 shares issued and outstanding                             218,213          218,213
   Additional paid-in capital                                           21,025,783       21,001,572
   Retained earnings, substantially restricted                          10,295,480       10,229,074
   Net unrealized appreciation on available-for-sale
       securities, net of deferred income taxes                          1,354,099        1,191,925
   Treasury stock, 151,939 and 49,392 shares as of December 31,
      1996 and September 30, 1996, respectively                         (2,657,781)        (789,495)
   Unallocated employee stock ownership plan (ESOP) shares              (1,600,200)      (1,629,300)
                                                                     -------------    -------------
      Total stockholders' equity                                        28,635,594       30,221,989
                                                                     -------------    -------------

      Total liabilities and stockholders' equity                     $ 107,050,701    $ 108,952,674
                                                                     =============    =============

</TABLE>

          See accompanying notes to consolidated financial statements.


                                        3

<PAGE>



            HARRODSBURG FIRST FINANCIAL BANCORP, INC. AND SUBSIDIARY
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (Unaudited)

                               ------------------
<TABLE>
<CAPTION>
                                                           For the Three-Month Periods
                                                               Ended December 31,
                                                                1996         1995         
                                                             ----------   ----------
Interest income:
<S>                                                          <C>          <C>       
   Interest on loans                                         $1,536,179   $1,491,598
   Interest and dividends on securities                         186,458       27,923
   Other interest income                                        189,557      423,203
                                                             ----------   ----------
      Total interest income                                   1,912,194    1,942,724
                                                             ----------   ----------

Interest expense:
   Interest on deposits                                         951,186      988,119
                                                             ----------   ----------

Net interest income                                             961,008      954,605
Provision for loan losses                                            --           --
                                                             ----------   ----------
Net interest income after provision for loan losses             961,008      954,605
                                                             ----------   ----------

Non-interest income:
   Loan and other service fees, net                              15,386       19,406
   Other                                                          4,591        5,525
                                                             ----------   ----------
                                                                 19,977       24,931
                                                             ----------   ----------
Non-interest expense:
   Compensation and benefits                                    224,638      199,150
   Occupancy expenses, net                                       30,183       31,338
   Federal and other insurance premiums                          38,517       46,352
   Data processing expenses                                      25,297       23,029
   State franchise tax                                           24,143       20,609
   Other operating expenses                                      87,663       83,954
                                                             ----------   ----------
                                                                430,441      404,432
                                                             ----------   ----------

Income before income tax expense                                550,544      575,104
Income tax expense                                              188,669      195,536
                                                             ----------   ----------

Net income                                                   $  361,875   $  379,568
                                                             ==========   ==========

Earnings per share                                           $     0.19   $     0.19
                                                             ==========   ==========

</TABLE>

          See accompanying notes to consolidated financial statements.


                                        4

<PAGE>



            HARRODSBURG FIRST FINANCIAL BANCORP, INC. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

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


                                                   For the Three-Month Periods
                                                        Ended December 31,
                                                   ---------------------------
                                                      1996            1995
                                                    ---------      ---------
Operating activities
Net income                                        $   361,875    $   379,568
Adjustments to reconcile net income to net cash
   provided by operating activities:
   Provision for loan losses
   ESOP benefit expense                                53,311         39,646
   Provision for depreciation                          16,074         17,964
   Amortization of loan fees                          (10,050)       (17,529)
   Amortization of investment discount                   (254)
   FHLB stock dividend                                (21,000)       (19,600)
   Change in:
     Interest receivable                               77,381         16,015
     Interest payable                                   1,273          1,102
     Accrued liabilities                             (566,058)           634
     Prepaid expense                                  108,746         78,591
     Income taxes payable                             133,302        160,108
                                                  -----------    -----------

   Net cash provided by operating activities          154,600        656,499
                                                  -----------    -----------

Investing activities
Net (increase) decrease in loans                   (1,281,480)     1,392,712
Maturity of certificates of deposit                 1,000,000      1,000,000
Purchase of held-to-maturity securities              (500,000)    (2,500,000)
Principle repayments - mortgage back securities         6,149         10,651
Purchase of fixed assets                              (10,301)       (46,228)
Retirement of assets                                    2,667
                                                  -----------    -----------

   Net cash (used) by investing activities           (785,632)      (140,198)
                                                  -----------    -----------



          See accompanying notes to consolidated financial statements.


                                        5

<PAGE>



            HARRODSBURG FIRST FINANCIAL BANCORP, INC. AND SUBSIDIARY
                CONSOLIDATED STATEMENTS OF CASH FLOWS, Continued
                                   (Unaudited)

                               ------------------
<TABLE>
<CAPTION>
                                                                 For the Three-Month Periods
                                                                      Ended December 31,
                                                                 ----------------------------
                                                                     1996             1995
                                                                   ---------       ---------
Financing activities
Net increase (decrease) in demand deposits,
<S>                                                              <C>             <C>    
   NOW accounts and savings accounts                                  298,223         551,362
Net increase (decrease) in certificates of deposit                    168,552         (52,069)
Net increase (decrease) in custodial accounts                         (42,780)        (54,262)
Payment of conversion expenses                                                       (365,414)
Purchase of treasury stock                                         (1,868,286)
Payment of dividends                                                 (687,103)
                                                                 ------------    ------------
   Net cash provided (used) by financing activities                (2,131,394)         79,617
                                                                 ------------    ------------

   Increase (decrease) in cash and cash equivalents                (2,762,426)        595,918

Cash and cash equivalents, beginning of period                     15,064,677      21,990,430
                                                                 ------------    ------------

Cash and cash equivalents, end of period                         $ 12,302,251    $ 22,586,348
                                                                 ============    ============


Supplemental Disclosures
   Cash payments for:
     Interest on deposits                                        $    949,913    $    987,017
                                                                 ============    ============
     Income taxes                                                $               $
                                                                 ============    ============

</TABLE>

          See accompanying notes to consolidated financial statements.


                                        6

<PAGE>



NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.  Basis of Presentation

    Harrodsburg  First  Financial  Bancorp  (the  "Company")  was  formed at the
    direction  of First  Federal  Savings  Bank of  Harrodsburg  (the "Bank") to
    become the holding  company of the Bank upon the conversion of the Bank from
    mutual to stock form (the  "Conversion").  The Company's sole business is to
    serve  as a  holding  company  for  the  Bank.  Accordingly,  the  financial
    statements and discussions herein include both the Company and the Bank. The
    Company was  incorporated  at the direction of the Board of Directors of the
    Bank in June 1995. On September 29, 1995,  the Bank converted from mutual to
    stock form as a wholly owned subsidiary of the Company.  In conjunction with
    the Conversion,  the Company issued  2,182,125 shares of its common stock to
    the public.

    The  accompanying  unaudited  consolidated  financial  statements  have been
    prepared  in  accordance  with  generally  accepted  accounting   principles
    ("GAAP") for interim financial information and with the instructions to Form
    10-Q and Article 10 of Regulation S-X. Accordingly,  they do not include all
    of the  information  and footnotes  required by GAAP for complete  financial
    statements.  In the opinion of management,  all  adjustments  (consisting of
    only normal recurring  accruals)  necessary for fair  presentation have been
    included.  The  results of  operations  and other  data for the three  month
    period ended  December 31, 1996 are not  necessarily  indicative  of results
    that may be expected for the entire fiscal year ending September 30, 1997.

2.  Earnings Per Share

    Earnings per share for the three month periods  ended  December 31, 1996 and
    1995 amounted to $0.19 per share for both periods, based on weighted average
    common  stock shares  outstanding.  The  weighted  average  number of common
    shares issued and outstanding for the three month periods ended December 31,
    1996 and 1995 was 1,919,985 and 2,009,010 shares, respectively.

3.  Dividends

    A special  cash  dividend of $0.15 per share was paid on October 16, 1996 to
    stockholders  of record as of October 1, 1996.  A cash  dividend of $.20 per
    share was paid on October 15, 1996 to stockholders of record as of September
    30, 1996. The total dividends paid by the Company for the three months ended
    December 31, 1996 amounted to $687,103.

4.  Treasury stock

    Pursuant to the stock  repurchase plan approved by the Board of Directors of
    the  Company on  September  16,  1996,  the Company  repurchased  a total of
    102,547 shares at a total price of $1,868,286  during the three months ended
    December 31, 1996.

5.  Subsequent Event - Employee Benefit Plans

    On  January  27,  1997  the   stockholders  of  the  Company   approved  the
    establishment of the Harrodsburg  First Financial  Bancorp,  Inc. 1996 Stock
    Option  Plan  ("Option   Plan")  and  the  First  Federal  Savings  Bank  of
    Harrodsburg  Restricted  Stock Plan and Trust Agreement  ("Restricted  Stock
    Plan").


                                        7

<PAGE>



    Pursuant to the Option Plan,  which is effective  January 27, 1997,  200,000
    authorized  but  unissued  shares of common  stock  have been  reserved  for
    issuance  upon the exercise of options or the grant of  restricted  stock to
    employees  and  directors  of the  Company or the Bank.  Effective  with the
    approval of the Option Plan by the stockholders,  stock options were granted
    for the purchase of 190,000 shares.  The options are exercisable at the fair
    market  value of the common  stock on the date of the award which was $16.63
    per share.  All options are  nontransferable  and have a maximum  term of 10
    years.

    The objective of the Restricted Stock Plan (RSP), which is effective January
    27,  1997,  is to  enable  the  Bank to  attract  and  retain  personnel  of
    experience and ability in key positions of responsibility. Those eligible to
    receive  benefits under the Restricted  Stock Plan will be such employees as
    selected  by members of a  committee  appointed  by the  Company's  Board of
    Directors.  The Restricted  Stock Plan is a non-qualified  plan that will be
    managed through a separate trust. The Bank will contribute  sufficient funds
    to the RSP Trust for the  purchase of up to 85,000  shares of common  stock.
    The Company  will  recognize  an expense  for the fair  market  value of any
    awards granted over the period the award is earned.



                                        8

<PAGE>



ITEM 2:  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

Results of Operations for the Three Months Ended December 31, 1996 and 1995

Net Income

Net income  decreased by $18,000 or 4.7% for the period ended  December 31, 1996
as compared to the same period in 1995.  The net  decrease of $18,000 was due to
an increase of $26,000 in non-interest expenses, and a decrease of approximately
$5,000 in non-interest income,  offset by approximately a $6,000 increase in net
interest income and a $7,000 decrease in income tax expense for 1996 compared to
1995.

Interest Income

Interest income was $1.9 million, or 7.24% of average  interest-earning  assets,
for the quarter ended December 31, 1996 as compared to $1.9 million, or 7.36% of
average  interest-earning  assets,  for the quarter  ended  December  31,  1995.
Interest  income  decreased by $31,000 or 1.6% from 1996 to 1995. The change was
due to a 12 basis  point  decrease  in the  average  rate  earned on the average
interest-earning  assets offset by a $71,000  increase in the average balance of
interest-earning  assets during the quarter ended  December 31, 1996 compared to
the quarter ended December 31, 1995.

Interest Expense

Interest expense was $951,000,  or 5.00% of average  interest-bearing  deposits,
for the quarter  ended  December 31, 1996 as compared to  $988,000,  or 5.21% of
average  interest-bearing  deposits,  for  the  corresponding  period  in  1995.
Interest expense  decreased by $37,000 or 3.7% from 1996 to 1995. The change was
due  primarily  to a 21 basis point  decrease  in the  average  rate paid on the
deposits during the period ended December 31, 1996 compared to the corresponding
period in 1995,  partially  offset by a increase  of  $203,000 in the balance of
average interest-bearing liabilities.

Provision for Loan Losses

There was no provision  for loan losses during the quarters  ended  December 31,
1996 and 1995.  Management  considers many factors in determining  the necessary
levels of the allowance for loan losses, including an analysis of specific loans
in the portfolio,  estimated value of the underlying  collateral,  assessment of
general  trends  in the real  estate  market,  delinquency  trends,  prospective
economic and regulatory conditions, inherent loss in the loan portfolio, and the
relationship of the allowance for loan losses to outstanding  loans. At December
31, 1996 the allowance for loan losses  represented .37% of total loans compared
to .40% at  December  31,  1995.  The  allowance  for loan losses was at a level
consistent with management's analysis of the loan portfolio.

Non-Interest Income

Non-interest  income  amounted to $20,000 and  $25,000  for the  quarters  ended
December  31,  1996 and 1995,  respectively.  The largest  item in  non-interest
income is service fees on loan and deposit  accounts,  which amounted to $15,000
and $19,000 for 1996 and 1995, respectively. The decrease in non-interest income
of  $5,000  was  primarily  due to the  decrease  in  income  from  late fees on
delinquent loans plus an increase in NOW account service fees.

                                        9

<PAGE>



Non-Interest Expense

Non-interest expense increased approximately $26,000 or 6.4% to $430,000 for the
quarter ended December 31, 1996 compared to $404,000 for the  comparable  period
in 1995.  Non-interest  expense  was 1.6% and  1.5% of  average  assets  for the
quarters ended December 31, 1996 and 1995, respectively. The increase of $26,000
was due primarily to an increase in compensation  and benefits of $25,000 plus a
net increase of $1,000 in other non-interest  expenses.  The increase of $26,000
in  compensation  and benefits was due to an increase of $14,000  related to the
employee  stock  option plan due to the  average  increase in price of the stock
plus an increase of $11,000 due to normal salary increases.

Income Taxes

The  provision  for income tax expense  amounted to  approximately  $188,000 and
$196,000 for the quarters ended December 31, 1996 and 1995, respectively,  which
as a percentage of income before income tax expenses  amounted to 34.0% for 1996
and 1995.

Non-Performing Assets

The  following  table  sets  forth   information  with  respect  to  the  Bank's
non-performing  assets  at the  dates  indicated.  No  loans  were  recorded  as
restructured loans within the meaning of SFAS No. 15 at the dates indicated.

<TABLE>
<CAPTION>
                                                                    December 31, 1996     September 30, 1995
                                                                    -----------------     ------------------
                                                                            (amounts in thousands)            
Loans accounted for on a non-accrual basis:1                                             
  Real Estate:                                                                           
<S>                                                                     <C>                 <C>       
    Residential.................................................        $         -         $        -
                                                                        -----------         ---------- 
Total   ........................................................                  -                  -
                                                                        -----------         ---------- 
                                                                                         
Accruing loans which are contractually past due 90 days or more:                         
  Real Estate:                                                                           
    Residential.................................................                528                567
    Other.......................................................                 73                 58
    Consumer....................................................                 96                241
                                                                        -----------         ---------- 
Total   ........................................................                697                866
                                                                        -----------         ---------- 
                                                                                         
Total of non-accrual and 90 day past due loans                          $       697         $      866
                                                                        ===========         ==========
                                                                                         
Percentage of net loans.........................................                .88%              1.12%
                                                                        ===========         ==========
                                                                                      
Other non-performing assets2....................................        $         -         $        -
                                                                        ===========         ==========
</TABLE>

-----------------------
  1   Non-accrual  status  denotes  any loan  past due 90 days  and  whose  loan
      balance,   plus  accrued  interest  exceeds  90%  of  the  estimated  loan
      collateral  value.  Payments  received  on a  non-accrual  loan are either
      applied to the  outstanding  principal  balance or  recorded  as  interest
      income,  or both,  depending on  assessment of the  collectibility  of the
      loan.
  2   Other  non-performing  assets  represent  property  acquired  by the  Bank
      through  foreclosure  or  repossessions  or accounted for as a foreclosure
      in-substance.  This  property  is carried at the lower of its fair  market
      value or the principal balance of the related loan, whichever is lower.

                                       10

<PAGE>



At December 31,  1996,  the Bank did not have any loans in  non-accrual  status.
Accordingly,  all income earned for the three months ended  December 31, 1996 on
the loans in the table above, has been included in income.

At December 31, 1996, there were no loans  identified by management,  which were
not reflected in the preceding  table, but as to which known  information  about
possible credit problems of borrowers  caused  management to have serious doubts
as to the ability of the borrowers to comply with present loan repayment terms.

FINANCIAL CONDITION

The Company's  consolidated assets decreased  approximately $1.9 million or .17%
to $107.1  million at December 31, 1996 compared to $108.9  million at September
30, 1996.  The net decrease of $1.9 million was due  primarily to a $3.7 million
decrease in cash, interest bearing deposits, and certificates of deposits offset
in part by an increase  of $1.3  million in loans and an increase of $761,000 in
investment securities.

The Company's investment portfolio increased approximately $761,000.  Securities
classified as available-for-  sale and recorded at market value per SFAS No. 115
increased  $246,000  due  solely  to  the  increase  in  market  value  of  such
securities.  Securities held-to-maturity increased $515,000 primarily due to the
purchase of a FHLB bond, based on management's decision to seek higher yields on
funds available for investment.

Loans  receivable  increased  by $1.3  million,  or 1.7% from  $77.5  million at
September  30,  1996 to $78.8  million  at  December  31,  1996,  as  management
continued its efforts to meet the loan demand in the Bank's market area.

Under SFAS No. 115, unrealized gains or losses on securities  available-for-sale
are  recorded  net of deferred  income tax as a separate  component  of retained
earnings.  At December 31, 1996, the Company  included net  unrealized  gains of
approximately  $1,354,000  in retained  earnings.  At September  30,  1996,  the
Company included net unrealized  gains of  approximately  $1,192,000 in retained
earnings.  Per SFAS No.  115,  such gains or losses will not be  reflected  as a
charge or credit to  earnings  until the  underlying  gains or loss,  if any, is
actually realized at the time of sale.

Stockholders'  equity decreased by $1.6 million to $28.6 million for the quarter
ended  December 31, 1996. The net decrease of $1.6 million is due to decrease of
$1.9  million  from the  purchase  of  Treasury  Stock  and the  declaration  of
dividends  totaling  $295,000,  offset in part by an increase from net income of
$362,000, an increase of $162,000 in net unrealized  appreciation on investments
held-for-sale,  and an increase of $53,000 related to the release of ESOP shares
from collateral during the quarter ended December 31, 1996.

                                       11

<PAGE>



The  following  summarized  the Bank's  capital  requirements  and  position  at
December 31, 1996 and September 30, 1996.

<TABLE>
<CAPTION>

                                                  December 31          September 30
                                                     1996                  1995
                                            ---------------------   ---------------------
                                                         (Dollars in Thousands)
                                             Amount        Percent    Amount      Percent
                                            ---------     --------  ----------    -------

<S>                                         <C>             <C>       <C>          <C>      
Tangible capital .......................... $  22,148       20.7%     $21,754      20.2%    
Tangible capital requirement ..............     1,585        1.5%       1,618       1.5%
                                            ---------       ----    ---------      ---- 

Excess .................................... $  20,563       19.2%   $  20,136      18.7%
                                            =========       ====    =========      ==== 

Core capital ..............................   $22,148       20.7%   $  21,754      20.2%
Core capital requirement ..................     3,171        3.0%       3,235       3.0%
                                            ---------       ----    ---------      ---- 

Excess .................................... $  18,977       17.7%   $  18,519      17.2%
                                            =========       ====    =========      ==== 

Tangible capital ..........................   $22,148       41.2%   $  21,754      40.2%
General valuation allowance ...............       290         .5%         290        .5%
                                            ---------       ----    ---------      ---- 

Total capital (core and supplemental           22,438        41.7%     22,044      40.7%
Risk-based capital requirement ............     4,297        8.0%       4,334       8.0%
                                            ---------       ----    ---------      ---- 

Excess .................................... $  18,141       33.7%   $  17,710      32.7%
                                            =========       ====    =========      ==== 
</TABLE>

Liquidity

The liquidity of the Company  depends  primarily on the dividends  paid to it as
the sole  shareholder  of the Bank.  At December  31,  1996,  the Bank could pay
common stock dividends of approximately $11.4 million.

The Bank's primary sources of funds are deposits and proceeds from principal and
interest  payments of loans.  Additional  sources of liquidity are advances from
the FHLB of Cincinnati and other borrowings.  At December 31, 1996, the Bank had
no outstanding borrowings.  The Bank has utilized and may in the future, utilize
FHLB of  Cincinnati  borrowings  during  periods  when  management  of the  Bank
believes that such borrowings  provide a lower cost source of funds than deposit
accounts  and the Bank  desires  liquidity  in order to help  expand its lending
operations.

The Company's operating activities produced positive cash flows for the quarters
ended December 31, 1996 and 1995.

The Bank's  most  liquid  assets are cash and  cash-equivalents,  which  include
investments in highly liquid,  short-term investments.  At December 31, 1996 and
September 30, 1996,  cash and cash  equivalents  totaled $12.3 million and $15.1
million, respectively.

At December 31, 1996, the Bank had $40.4 million in certificates of deposits due
within one year and $17.0  million due between one and three  years.  Management
believes,  based  on past  experience,  that the Bank  will  retain  much of the
deposits or replace them with new deposits.  At December 31, 1996,  the Bank had
$1.2

                                       12

<PAGE>



million in outstanding  commitments to originate mortgages.  The Bank intends to
fund these  commitments  with  short-term  investments  and  proceeds  from loan
repayments.

OTS regulations  require that the Bank maintain  specified  levels of liquidity.
Liquidity is measured as a ratio of cash and certain investments to withdrawable
savings.  The minimum  level of liquidity  required by  regulation  is presently
5.0%.  During the first  quarter of fiscal  year 1997,  the Bank  satisfied  all
regulatory  liquidity  requirements,  and management believes that the liquidity
levels maintained are adequate to meet potential deposit outflows,  loan demand,
and normal operations.

Impact of Inflation and Changing Prices

The consolidated  financial  statements and notes thereto  presented herein have
been prepared in accordance with generally accepted accounting principles, which
require the measurement of financial  position and operating results in terms of
historical  dollars without  considering  the change in the relative  purchasing
power of money  over  time and due to  inflation.  The  impact of  inflation  is
reflected  in the  increased  cost  of the  Company's  operations.  Unlike  most
industrial  companies,  nearly all the assets and liabilities of the Company are
monetary in nature.  As a result,  interest  rates have a greater  impact on the
Company's  performance  than do the  effects  of  general  levels of  inflation.
Interest  rates do not  necessarily  move in the same  direction  or to the same
extent as the price of goods and services.



                                       13

<PAGE>



PART II.     OTHER INFORMATION
             -----------------

Item 1.      Legal Proceedings                                        None

Item 2.      Changes in Securities                                    None

Item 3.      Defaults Upon Senior Securities                          None

Item 4.      Submission of Matters to a Vote of Security Holders      None

Item 5.      Other Information                                        None

Item 6.      Exhibits and Reports on Form 8-K                         None



                                       14

<PAGE>


                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the  registrant  has duly  caused  this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                                     Harrodsburg First Financial Bancorp, Inc.

                                     /s/ Jack Hood
Date:                                --------------------------------------
                                     Jack Hood, President



                                     /s/ Teresa W. Noel
Date:                                --------------------------------------
                                     Teresa W. Noel, Treasurer



                                       15