**UNITED
      STATES**


**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington,
      D.C. 20549**





**FORM
      10-Q**





(Mark
      One)


x
            QUARTERLY
                REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE
                ACT OF 1934





For
      the
      quarterly period
      ended March
      31,
      2008





OR





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





For
      the
      transition period from ____________ to _______________





Commission
      File Number: 0-51176





KENTUCKY
                FIRST FEDERAL BANCORP(Exact
                name of registrant as specified in its
                charter)





United
                States of America
            
            61-1484858(State
                or other jurisdiction of
            
            (I.R.S.
                Employer Identification No.)incorporation
                or organization)





479
                Main Street, Hazard, Kentucky 41702(Address
                of principal executive offices)(Zip
                Code)





(606)
                436-3860(Registrant’s
                telephone number, including area
                code)





(Former
                name, former address and former fiscal year, if changed since last
                report)





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 such shorter period that the issuer was required to
      file
      such reports and (2) has been subject to such filing requirements for the past
      ninety days:  Yes x  No
o





Indicate
      by check mark whether the registrant is a large accelerated filer, an
      accelerated filer, or a non-accelerated filer. See definition of “accelerated
      filer and larger accelerated filer” in Rule 12b-2 of the Exchange Act. (Check
      one):





Large
                accelerated filer o
            Accelerated
                filer oNon-accelerated
                filer o
            Smaller
                Reporting Company x


(Do
      not
      check if a smaller reporting company)





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act.) Yes o  No
x





APPLICABLE
      ONLY TO CORPORATE ISSUERS





Indicate
      the number of shares outstanding of each of the issuer’s classes of common
      stock, as of the latest practicable date: At May 9, 2008, the latest practicable
      date, the Corporation had 7,655,164 shares of $.01 par value common stock
      outstanding.





1




INDEX





PagePART
                I -
            ITEM
                1
            FINANCIAL
                INFORMATIONStatements
                of Financial Condition
            3Statements
                of Earnings
            4Statements
                of Comprehensive Income
            5Statements
                of Cash Flows
            6Notes
                to Financial Statements
            8ITEM
                2
            Management’s
                Discussion and Analysis ofFinancial
                Condition and Results ofOperations
            13ITEM
                3
            Quantitative
                and Qualitative DisclosuresAbout
                Market Risk
            18ITEM
                4
            Controls
                and Procedures
            18PART
                II -
            OTHER
                INFORMATION
            19SIGNATURES
            
            21








2


PART
      I


ITEM
      1: Financial
      Information


**Kentucky
      First Federal Bancorp**





**CONSOLIDATED
      STATEMENTS OF FINANCIAL CONDITION**





(In
      thousands, except per share data)





**March
                31,**
            
            **June
                30,****ASSETS**
            
            **2008**
            
            **2007****(Unaudited)**Cash
                and due from banks
            
            $
            1,133
            
            $
            1,179Interest-bearing
                deposits in other financial institutions
            
            
            16,720
            
            
            1,541Cash
                and cash equivalents
            
            
            17,853
            
            
            2,720Interest-bearing
                deposits
            
            
            100
            
            
            100Available-for-sale
                securities
            
            
            13,659
            
            
            13,298Held-to-maturity
                securities, at amortized cost - approximate
            
            
            17,528
            
            
            59,606fair
                value of $17,396 and $57,835 atMarch
                31, 2008 and June 30, 2007, respectivelyLoans
                available for sale
            
            
            265
            
            
            -Loans
                receivable
            
            
            177,655
            
            
            166,876Allowance
                for loan losses
            
            
            (666
            )
            
            (720
            )176,989
            
            
            166,156Real
                estate acquired through foreclosure
            
            
            35
            
            
            8Office
                premises and equipment - at depreciated cost
            
            
            2,745
            
            
            2,762Federal
                Home Loan Bank stock - at cost
            
            
            5,492
            
            
            5,421Accrued
                interest receivable
            
            
            805
            
            
            935Bank-owned
                life insurance
            
            
            2,320
            
            
            2,256Goodwill
            
            
            14,507
            
            
            14,507Intangible
                assets-net
            
            
            513
            
            
            612Prepaid
                expenses and other assets
            
            
            261
            
            
            276Prepaid
                federal income taxes
            
            
            441
            
            
            259Total
                assets
            
            **$**
            **253,513**
            ****
            **$**
            **268,916******
            ****
            ****
            ****
            ******LIABILITIES
                AND SHAREHOLDERS’ EQUITY**Deposits
            
            $
            137,316
            
            $
            139,893Advances
                from the Federal Home Loan Bank
            
            
            53,564
            
            
            65,132Advances
                by borrowers for taxes and insurance
            
            
            200
            
            
            343Accrued
                interest payable
            
            
            302
            
            
            365Deferred
                federal income taxes
            
            
            1,179
            
            
            930Other
                liabilities
            
            
            641
            
            
            808Total
                liabilities
            
            
            193,202
            
            
            207,471Commitments
            
            
            -
            
            
            -Shareholders’
                equityPreferred
                stock, 500,000 shares authorized, $.01 par value; no shares
                issued
            
            
            -
            
            
            -Common
                stock, 20,000,000 shares authorized $.01par value; 8,596,064 shares
                issued
            
            
            86
            
            
            86Additional
                paid-in capital
            
            
            35,806
            
            
            35,459Retained
                earnings
            
            
            32,284
            
            
            32,291Shares
                acquired by stock benefit plans
            
            
            (2,781
            )
            
            (3,013
            )Treasury
                shares at cost, 506,830 and 299,430 shares at March 31,
                2008and
                June 30, 2007, respectively
            
            
            (5,172
            )
            
            (3,091
            )Accumulated
                other comprehensive gain (loss)
            
            
            88
            
            
            (287
            )Total
                shareholders’ equity
            
            
            60,311
            
            
            61,445Total
                liabilities and shareholders’ equity
            
            **$**
            **253,513**
            
            **$**
            **268,916**




See
      Notes
      to Consolidated Financial Statements.





3


**Kentucky
      First Federal Bancorp**


**CONSOLIDATED
      STATEMENTS OF EARNINGS**





(Unaudited)


(In
      thousands, except per share data)





**Nine
                months ended**
            
            **Three
                months ended****March
                31,**
            
            **March
                31,****2008**
            
            **2007**
            
            **2008**
            
            **2007**
            ********
            ****
            ****
            ****
            ****
            ****
            ****
            ****Interest
                incomeLoans
            
            $
            7,873
            
            $
            7,290
            
            $
            2,669
            
            $
            2,470Mortgage-backed
                securities
            
            
            507
            
            
            588
            
            
            165
            
            
            187Investment
                securities
            
            
            1,305
            
            
            1,496
            
            
            319
            
            
            496Interest-bearing
                deposits and other
            
            
            303
            
            
            285
            
            
            98
            
            
            98Total
                interest income
            
            
            9,988
            
            
            9,659
            
            
            3,251
            
            
            3,251Interest
                expenseDeposits
            
            
            3,729
            
            
            3,325
            
            
            1,205
            
            
            1,160Borrowings
            
            
            2,206
            
            
            2,155
            
            
            622
            
            
            733Total
                interest expense
            
            
            5,935
            
            
            5,480
            
            
            1,827
            
            
            1,893Net
                interest income
            
            
            4,053
            
            
            4,179
            
            
            1,424
            
            
            1,358Provision
                for losses on loans
            
            
            12
            
            
            -
            
            
            12
            
            
            -Net
                interest income after provision for losses on loans
            
            
            4,041
            
            
            4,179
            
            
            1,412
            
            
            1,358Other
                operating incomeEarnings
                on bank-owned life insurance
            
            
            64
            
            
            62
            
            
            21
            
            
            21Gain
                on sale of loans
            
            
            10
            
            
            9
            
            
            7
            
            
            6Loss
                on sale of real estate acquired through foreclosure
            
            
            -
            
            
            (6
            )
            
            -
            
            
            -Other
                operating
            
            
            59
            
            
            69
            
            
            17
            
            
            24Total
                other income
            
            
            133
            
            
            134
            
            
            45
            
            
            51General,
                administrative and other expenseEmployee
                compensation and benefits
            
            
            2,200
            
            
            2,314
            
            
            710
            
            
            732Occupancy
                and equipment
            
            
            259
            
            
            253
            
            
            90
            
            
            88Franchise
                taxes
            
            
            117
            
            
            125
            
            
            39
            
            
            39Data
                processing
            
            
            117
            
            
            113
            
            
            45
            
            
            44Other
                operating
            
            
            567
            
            
            555
            
            
            188
            
            
            197Total
                general, administrative and other expense
            
            
            3,260
            
            
            3,360
            
            
            1,072
            
            
            1,100Earnings
                before income taxes
            
            
            914
            
            
            953
            
            
            385
            
            
            309Federal
                income taxesCurrent
            
            
            137
            
            
            149
            
            
            68
            
            
            74Deferred
            
            
            153
            
            
            155
            
            
            56
            
            
            24Total
                federal income taxes
            
            
            290
            
            
            304
            
            
            124
            
            
            98NET
                EARNINGS
            
            **$**
            **624**
            ****
            **$**
            **649**
            ****
            **$**
            **261**
            ****
            **$**
            **211**
            ********
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****EARNINGS
                PER SHARE
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****Basic
            ****
            **$**
            **0.08**
            ****
            **$**
            **0.08**
            ****
            **$**
            **0.03**
            ****
            **$**
            **0.02**
            ****Diluted
            ****
            **$**
            **0.08**
            ****
            **$**
            **0.08**
            ****
            **$**
            **0.03**
            ****
            **$**
            **0.02**
            ********
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****DIVIDENDS
                PER SHARE
            ****
            **$**
            **0.30**
            ****
            **$**
            **0.30**
            ****
            **$**
            **0.10**
            ****
            **$**
            **0.10**





See
      Notes
      to Consolidated Financial Statements.





4


**Kentucky
      First Federal Bancorp**





**CONSOLIDATED
      STATEMENTS OF COMPREHENSIVE INCOME**





(Unaudited)


(In
      thousands)




**Nine
                months ended**
            
            **Three
                months ended****March
                31,**
            
            **March
                31,****2008**
            
            **2007**
            
            **2008**
            
            **2007**Net
                earnings
            
            $
            624
            
            $
            649
            
            $
            261
            
            $
            211Other
                comprehensive income, net of taxes (benefits):Unrealized
                holding gains (losses) on securities duringthe
                period, net of taxes (benefits) of $193, $132, $79and
                $23 during the respective periods
            
            
            375
            
            
            256
            
            
            153
            
            
            44Comprehensive
                income
            
            $
            **999**
            ****
            **$**
            **905**
            ****
            **$**
            **414**
            ****
            **$**
            **255**
            ********
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****
            ****Accumulated
                comprehensive gain (loss)
            ****
            **$**
            **88**
            ****
            **$**
            **(280**
            **)**
            **$**
            **88**
            ****
            **$**
            **(280**
            **)**




See
      Notes
      to Consolidated Financial Statements.








5


**Kentucky
      First Federal Bancorp**





**CONSOLIDATED
      STATEMENTS OF CASH FLOWS**





For
      the  nine
      months ended March 31,


(Unaudited)


(In
      thousands)


**2008**
            
            **2007******
            
            ****Cash
                flows from operating activities:Net
                earnings for the period
            
            $
            624
            
            $
            649Adjustments
                to reconcile net earnings to net cashprovided
                by operating activities:Amortization
                of discounts and premiums on loans,investments
                and mortgage-backed securities - net
            
            
            1
            
            
            (17
            )Amortization
                of deferred loan origination fees
            
            
            (34
            )
            
            (22
            )Amortization
                of purchase accounting adjustments-net
            
            
            (299
            )
            
            (308
            )Depreciation
                and amortization
            
            
            108
            
            
            113Amortization
                of stock benefit plans
            
            
            670
            
            
            592(Gain)
                loss on sale of real estate acquired through foreclosure
            
            
            -
            
            
            6Provision
                for losses on loans
            
            
            12
            
            
            -Federal
                Home Loan Bank stock dividends
            
            
            (71
            )
            
            (157
            )Bank-owned
                life insurance earnings
            
            
            (64
            )
            
            (62
            )Mortgage
                loans originated for sale
            
            
            (1,100
            )
            
            (528
            )Gain
                on sale of loans
            
            
            (10
            )
            
            (9
            )Proceeds
                from sale of mortgage loans
            
            
            845
            
            
            531Increase
                (decrease) in cash, due to changes in:Accrued
                interest receivable
            
            
            130
            
            
            (203
            )Prepaid
                expenses and other assets
            
            
            15
            
            
            (32
            )Accrued
                interest payable
            
            
            (63
            )
            
            101Other
                liabilities
            
            
            (8
            )
            
            (93
            )Federal
                income taxesCurrent
            
            
            (182
            )
            
            (57
            )Deferred
            
            
            56
            
            
            155Net
                cash provided by operating activities
            
            
            630
            
            
            659Cash
                flows provided by (used in) investing activities:Investment
                securities maturities, prepayments and calls:Held
                to maturity
            
            
            42,078
            
            
            3,826Available
                for sale
            
            
            207
            
            
            299Proceeds
                from sale of real estate acquired through foreclosure
            
            
            -
            
            
            144Loan
                principal repayments
            
            
            29,401
            
            
            20,497Loan
                disbursements
            
            
            (40,239
            )
            
            (29,783
            )Purchase
                of office equipment
            
            
            (91
            )
            
            (38
            )Net
                cash provided by (used in) investing activities
            
            
            31,356
            
            
            (5,055
            )Cash
                flows provided by (used in) financing activities:Net
                decrease in deposit accounts
            
            
            (2,577
            )
            
            (2,139
            )Proceeds
                from Federal Home Loan Bank advances
            
            
            21,600
            
            
            107,750Repayment
                of Federal Home Loan Bank advances
            
            
            (32,771
            )
            
            (98,582
            )Advances
                by borrowers for taxes and insurance
            
            
            (143
            )
            
            (151
            )Dividends
                paid on common stock
            
            
            (881
            )
            
            (1,123
            )Purchase
                of shares for treasury
            
            
            (2,081
            )
            
            (1,885
            )Net
                cash provided by (used in) financing activities
            
            
            (16,853
            )
            
            3,870Net
                increase (decrease) in cash and cash equivalents
            
            
            15,133
            
            
            (526
            )Cash
                and cash equivalents at beginning of period
            
            
            2,720
            
            
            2,294Cash
                and cash equivalents at end of period
            
            **$**
            **17,853**
            
            **$**
            **1,768**





See
      Notes
      to Consolidated Financial Statements.





6





**Kentucky
      First Federal Bancorp**





**CONSOLIDATED
      STATEMENTS OF CASH FLOWS (CONTINUED)**





For
      the
      nine months ended March 31,


(Unaudited)


(In
      thousands)





**2008**
            
            **2007******
            ****
            ****
            ****
            ****Supplemental
                disclosure of cash flow information:Cash
                paid during the period for:Federal
                income taxes
            
            **$**
            **165**
            
            **$**
            **135**Interest
                on deposits and borrowings
            
            **$**
            **6,493**
            
            **$**
            **5,785**Transfers
                from loans to real estate acquiredthrough
                foreclosure, net
            
            **$**
            **27**
            
            **$**
            **-**




See
      Notes
      to Consolidated Financial Statements.




7


**Kentucky
      First Federal Bancorp**





**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS**





For
      the
      nine- and three-month periods ended March 31, 2008 and 2007





On
      March
      2, 2005, First Federal Savings and Loan Association of Hazard (“First Federal of
      Hazard” or the “Association”) completed a Plan of Reorganization (the “Plan” or
      the “Reorganization”) pursuant to which the Association reorganized into the
      mutual holding company form of ownership with the incorporation of a stock
      holding company, Kentucky First Federal Bancorp (the “Company”) as parent of the
      Association. Coincident with the Reorganization, the Association converted
      to
      the stock form of ownership, followed by the issuance of all the Association’s
      outstanding stock to Kentucky First Federal Bancorp. Completion of the Plan
      of
      Reorganization culminated with Kentucky First Federal Bancorp issuing 4,727,938
      common shares, or 55% of its common shares, to First Federal Mutual Holding
      Company (“First Federal MHC”), a federally chartered mutual holding company,
      with 2,127,572 common shares, or 24.8% of its shares offered for sale at $10.00
      per share to the public and a newly formed Employee Stock Ownership Plan
      (“ESOP”). The Company received net cash proceeds of $16.1 million from the
      public sale of its common shares. The Company’s remaining 1,740,554 common
      shares were issued as part of the $31.4 million cash and stock consideration
      paid for 100% of the common shares of Frankfort First Bancorp (“Frankfort
      First”) and its wholly-owned subsidiary, First Federal Savings Bank of Frankfort
      (“First Federal of Frankfort”). The acquisition was accounted for using the
      purchase method of accounting and resulted in the recordation of goodwill and
      other intangible assets totaling $15.4 million.





1. Basis
      of Presentation





The
      accompanying unaudited consolidated financial statements, which represent the
      consolidated financial condition and results of operations of the Company,
      were
      prepared in accordance with the instructions for Form 10-Q and, therefore,
      do
      not include information or footnotes necessary for a complete presentation
      of
      financial position, results of operations and cash flows in conformity with
      accounting principles generally accepted in the United States of America.
      However, in the opinion of management, all adjustments (consisting of only
      normal recurring accruals) which are necessary for a fair presentation of the
      consolidated financial statements have been included. The results of operations
      for the nine- and three-month periods ended March 31, 2008, are not necessarily
      indicative of the results which may be expected for an entire fiscal year.
      The
      consolidated balance sheet as of June 30, 2007 has been derived from the audited
      consolidated balance sheet as of that date.





2. Principles
      of Consolidation





The
      consolidated financial statements include the accounts of the Company, Frankfort
      First, and its wholly-owned banking subsidiaries, First Federal of Hazard and
      First Federal of Frankfort (collectively hereinafter “the Banks”). All
      intercompany transactions and balances have been eliminated in
      consolidation.





3. Critical
      Accounting Policies





We
      consider accounting policies involving significant judgments and assumptions
      by
      management that have, or could have, a material impact on the carrying value
      of
      certain assets or on income to be critical accounting policies. We consider
      the
      allowance for loan losses and accounting for goodwill to be critical accounting
      policies.





The
      allowance for loan losses is the estimated amount considered necessary to cover
      probable incurred credit losses in the loan portfolio at the balance sheet
      date.
      The allowance is established through the provision for losses on loans which
      is
      charged against income. In determining the allowance for loan losses, management
      makes significant estimates and has identified this accounting policy as one
      of
      the most critical for the Company.





8


**Kentucky
      First Federal Bancorp**





**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS**





For
      the
      nine- and three-month periods ended March 31, 2008 and 2007








3. Critical
      Accounting Policies (continued)





Management
      of the Banks perform a monthly evaluation of the allowance for loan losses.
      Consideration is given to a variety of factors in establishing this estimate
      including, but not limited to, current economic conditions, delinquency
      statistics, geographic and industry concentrations, the adequacy of the
      underlying collateral, the financial strength of the borrower, results of
      internal loan reviews, volume and mix of the loan portfolio and other relevant
      factors. This evaluation is inherently subjective as it requires material
      estimates that may be susceptible to change. Management considers the economic
      climate in the lending areas to be among the factors most likely to have an
      impact on the level of the required allowance for loan losses. However, in
      view
      of the fact that the Banks’ local economies are diverse, without significant
      dependence on a single industry or employer, the economic climate in the Banks’
market areas are considered to be stable, and improving. Nevertheless,
      management continues to monitor and evaluate factors which could have an impact
      on the required level of the allowance. Nationally, management will watch for
      issues that may negatively affect a significant percentage of homeowners in
      the
      Banks’ lending areas. These may include significant increases in unemployment or
      significant depreciation in home prices. Management reviews employment
      statistics periodically when determining the allowance for loan losses and
      generally finds the unemployment rate in the Banks’ lending areas to be
      acceptable in relation to historical trends. Given the aforementioned indicators
      of economic stability, management does not foresee in the near term, any
      significant increases in the required allowance for loan losses related to
      economic factors. Finally, Company management has no current plans to alter
      the
      type of lending offered or collateral accepted by the Banks, but if such plans
      change or market conditions result in large concentrations of certain types
      of
      loans, such as commercial real estate or high loan-to-value ratio residential
      loans, management would respond with an increase in the overall allowance for
      loan losses.





The
      allowance for loan losses analysis has two components, specific and general
      allocations. Specific allocations are made for loans that are determined to
      be
      impaired. Impairment is measured by determining the present value of expected
      future cash flows or, for collateral-dependent loans, the fair value of the
      collateral adjusted for market conditions and selling expenses. The general
      allocation is determined by segregating the remaining loans by type of loan,
      risk-weighting (if applicable) and payment history. Historical loss experience,
      delinquency trends, general economic conditions and geographic and industry
      concentrations are also analyzed. This analysis establishes factors that are
      applied to the loan groups to determine the amount of the general reserve.
      Actual loan losses may be significantly more than the allowance established,
      which could have a material negative effect on the Company’s consolidated
      financial results.





The
      Company has recorded goodwill and core deposit intangibles as a result of its
      acquisition of Frankfort First. Goodwill represents the excess purchase price
      paid over the net book value of the assets acquired in a merger or acquisition.
      Pursuant to SFAS No. 142, “Goodwill and Intangible Assets,” goodwill is not
      amortized, but is tested for impairment at the reporting unit annually or
      whenever an impairment indicator arises. The evaluation involves assigning
      assets and liabilities to reporting units and comparing the fair value of each
      reporting unit to its carrying value including goodwill. If the fair value
      of a
      reporting unit exceeds its carrying amount, goodwill is not considered impaired.
      However, if the carrying amount of the reporting unit exceeds the fair value,
      goodwill is considered impaired. The impairment loss equals the excess of
      carrying value over fair value.





Core
      deposit intangibles represent the value of long-term deposit relationships
      and
      are amortized over their estimated useful lives. The Company annually evaluates
      these estimated useful lives. If the Company determines that events or
      circumstances warrant a change in these estimated useful lifes, the Company
      will
      adjust the amortization of the core deposit intangibles, which could affect
      future amortization expense.





9





**Kentucky
      First Federal Bancorp**





**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS**





For
      the
      nine- and three-month periods ended March 31, 2008 and 2007








4. Earnings
      Per Share





Basic
      earnings per share is computed based upon the weighted-average common shares
      outstanding during the period less shares in the Company’s ESOP that are
      unallocated and not committed to be released. Weighted average common shares
      deemed outstanding give effect to 282,484 unallocated ESOP shares for the nine-
      and three-month periods ended March 31, 2008, and 301,262 unallocated ESOP
      shares for the nine- and three-month periods ended March 31, 2007.




**Nine
                months ended**
            
            **Three
                months ended****March
                31, 2008**
            
            **March
                31, 2008******
            
            ****Weighted-average
                common shares outstanding (basic)
            
            
            7,752,619
            
            
            7,693,955Dilutive
                effect of assumed exercise of stock options
            
            
            -
            
            
            -Weighted-average
                common shares outstanding (diluted)
            
            
            **7,752,619**
            
            
            **7,693,955**




**Nine
                months ended**
            
            **Three
                months ended****March
                31, 2007**
            
            **March
                31, 2007******
            
            ****Weighted-average
                common shares outstanding (basic)
            
            
            8,021,626
            
            
            7,985,234Dilutive
                effect of assumed exercise of stock options
            
            
            --
            
            
            --Weighted-average
                common shares outstanding (diluted)
            
            
            **8,021,626**
            
            
            **7,985,234**




There
      were 339,200 and 347,600 unexercised options representing non-dilutive shares
      outstanding for the nine- and three-month periods ended March 31, 2008 and
      2007,
      respectively.





10


**Kentucky
      First Federal Bancorp**





**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS**





For
      the
      nine- and three-month periods ended March 31, 2008 and 2007








5. Recent
      Accounting Pronouncements





The
      Company or one of its subsidiaries files income tax returns in the U.S. federal
      and Kentucky jurisdictions. With few exceptions, the Company is no longer
      subject to U.S. federal, state and local examinations by tax authorities for
      years before 2005.




The
      Company adopted the provisions of the Financial Accounting Standards Board
      (FASB) Interpretation No. 48 (FIN 48), *Accounting
      for Uncertainty in Income Taxes - an interpretation of FASB Statement No.
      109* ,
      on July
      1, 2007. FIN 48 prescribes a recognition threshold and measurement attribute
      for
      the financial statement recognition and measurement of a tax position taken
      or
      expected to be taken in a tax return. FIN 48 also provides guidance on
      derecognition, classification, interest and penalties, accounting in interim
      periods, disclosure and transition. The adoption of FIN 48 resulted in a
      $250,000 increase to the beginning balance of retained earnings, with no impact
      on the results of operations of the Company.




The
      following financial statement line items for the nine months ended March 31,
      2008 were affected by the change in accounting principle.




**March
                31, 2008 (in
                thousands)****As
                Computed Pre-FIN 48**
            
            **As
                Reported Under FIN 48**
            
            **Effect
                of Change***Balance
                Sheet*Refundable
                income taxes
            
            $
            191
            
            $
            441
            
            $
            250Retained
                earnings
            
            
            32,034
            
            
            32,284
            
            
            250




In
      February 2007, the Financial Accounting Standards Board (FASB) issued Statement
      of Financial Accounting Standards No. 159, The Fair Value Option for Financial
      Assets and Financial Liabilities - including an amendment of FASB Statement
      No.
      115 (SFAS No. 159). SFAS No. 159 permits us to choose to measure certain
      financial assets and liabilities at fair value that are not currently required
      to be measured at fair value (i.e. the Fair Value Option). Election of the
      Fair
      Value Option is made on an instrument-by-instrument basis and is irrevocable.
      At
      the adoption date, unrealized gains and losses on financial assets and
      liabilities for which the Fair Value Option has been elected would be reported
      as a cumulative adjustment to beginning retained earnings. If we elect the
      Fair
      Value Option for certain financial assets and liabilities, we will report
      unrealized gains and losses due to changes in their fair value in earnings
      at
      each subsequent reporting date. SFAS No. 159 is effective as of July 1, 2008.
      We
      are currently evaluating the potential impact of adopting SFAS No. 159 on our
      consolidated financial statements.





11


**Kentucky
      First Federal Bancorp**





**NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS**





For
      the
      nine- and three-month periods ended March 31, 2008 and 2007








5. Recent
      Accounting Pronouncements (continued)




In
      September 2006, the FASB issued Statement of Financial Accounting Standards
      No. 157, *Fair
      Value Measurements* (FAS
      157). FAS 157 enhances existing guidance for measuring assets and liabilities
      using fair value. Prior to the issuance of FAS 157, guidance for applying fair
      value was incorporated in several accounting pronouncements. FAS 157 provides
      a
      single definition of fair value, together with a framework for measuring it,
      and
      requires additional disclosure about the use of fair value to measure assets
      and
      liabilities. FAS 157 also emphasizes that fair value is a market-based
      measurement, not an entity-specific measurement, and sets out a fair value
      hierarchy with the highest priority being quoted prices in active markets.
      Under
      FAS 157, fair value measurements are disclosed by level within that hierarchy.
      While FAS 157 does not add any new fair value measurements, it does change
      current practice. Changes to practice include: (1) a requirement for an
      entity to include its own credit standing in the measurement of its liabilities;
      (2) a modification of the transaction price presumption; (3) a
      prohibition on the use of block discounts when valuing large blocks of
      securities for broker-dealers and investment companies; and (4) a
      requirement to adjust the value of restricted stock for the effect of the
      restriction even if the restriction lapses within one year. FAS 157 is effective
      for financial statements issued for fiscal years beginning after
      November 15, 2007, or July 1, 2008 and interim periods within those fiscal
      years. We are currently evaluating the potential impact of adopting FAS 157
      on
      our financial statements.




In
      September 2006, the FASB ratified a consensus opinion by the EITF on EITF Issue
      06-5, *Accounting
      for Purchases of Life Insurance-Determining the Amount That Could Be Realized
      in
      Accordance with FASB Technical Bulletin No. 85-4 (Accounting for Purchases
      of
      Life Insurance).* The
      issue
      requires policy holders to consider other amounts included in the contractual
      terms of an insurance policy, in addition to cash surrender value, for purposes
      of determining the amount that could be realized under the terms of the
      insurance contract. If it is probable that contractual terms would limit the
      amount that could be realized under the insurance contract, those contractual
      limitations should be considered when determining the realizable amounts. The
      amount that could be realized under the insurance contract should be determined
      on an individual policy (or certificate) level and should include any amount
      realized on the assumed surrender of the last individual policy or certificate
      in a group policy.




The
      Company holds several life insurance policies, however, the policies do not
      contain any provisions that would restrict or reduce the cash surrender value
      of
      the policies. The consensus in EITF Issue 06-5 is effective for fiscal years
      beginning after December 15, 2006. The application of this guidance did not
      have
      a material adverse effect on the Company’s financial position or results of
      operations.




6. Commitments




As
      of
      March 31, 2008, loan commitments and unused lines of credit totaled $12.5
      million, including $1.2 million in undisbursed construction loans, $1.7 million
      in one- to four-family mortgage loans and $9.7 million in lines of credit
      secured by equity in real property.










12





**Kentucky
      First Federal Bancorp**





**ITEM
      2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION**


**AND
      RESULTS OF OPERATIONS**





Forward-Looking
      Statements





Certain
      statements contained in this report that are not historical facts are
      forward-looking statements that are subject to certain risks and uncertainties.
      When used herein, the terms “anticipates,” “plans,” “expects,” “believes,” and
      similar expressions as they relate to Kentucky First Federal Bancorp or its
      management are intended to identify such forward looking statements. Kentucky
      First Federal Bancorp’s actual results, performance or achievements may
      materially differ from those expressed or implied in the forward-looking
      statements. Risks and uncertainties that could cause or contribute to such
      material differences include, but are not limited to, general economic
      conditions, prices for real estate in the Company’s market areas, interest rate
      environment, competitive conditions in the financial services industry, changes
      in law, governmental policies and regulations, and rapidly changing technology
      affecting financial services.





Discussion
      of Financial Condition Changes from June 30, 2007 to March 31,
      2008





***Assets:*** At March
      31, 2008, the Company’s assets totaled $253.5 million, a decrease of $15.4
      million, or 5.7%, from total assets at June 30, 2007. The primary reason for
      the
      decrease in assets was the maturity and or call of $42.1 million, or 70.6%,
      of
      held-to-maturity securities, which decreased to $17.5 million at March 31,
      2008.
      Somewhat offsetting the decrease in held-to-maturity securities was an increase
      of $10.8 million, or 6.5%, in loans receivable. It is management’s intention to
      deploy maturing or called investments into mortgage loans to the extent
      possible.





***Cash
      and cash equivalents:*** **** Cash
      and
      cash equivalents increased $15.1 million to $17.9 million at March 31, 2008,
      as
      a result of the of the Company’s unusually high level of calls on investment
      securities. It is the Company’s preference to minimize the level of cash and
      cash equivalents and invest liquidity into higher-yielding assets, when
      possible. However, given the rapid influx of liquidity, it will take some time
      before excess liquidity can be deployed.





***Loans*** *:* Loans
      receivable, net, increased to $177.0 million at March 31, 2008, an increase
      of
      $10.8 million or 6.5%. Management believes that the successful redeployment
      of
      the Company’s funds from lower-yielding cash, cash equivalents and investment
      securities to higher-yielding mortgage loans is important for the long-term
      success of the Company. The Company will continue to emphasize loan originations
      to the extent that it is profitable and prudent.





***Non-Performing
      Loans:*** **** At
      March 31, 2008, the Company had approximately $1.2 million, or 0.7% of net
      loans, in loans 90 days or more past due, compared to $968,000, or 0.6%, of
      net
      loans at June 30, 2007.  At March 31, 2008, the Company’s allowance for
      loan losses of $666,000 represented 53.8% of nonperforming loans and 0.4% of
      total loans.





The
      Company had $1.7 million in loans classified as substandard for regulatory
      purposes at March 31, 2008. Classified loans as a percentage of net loans was
      1.0% and 0.9% at March 31, 2008 and June 30, 2007, respectively. Substandard
      assets included 27 single-family home loans with loan-to-value ratios
      (percentage of loan balance to the original or an updated appraisal) ranging
      from 16% to 93%*; three home equity loan second mortgages secured by
      single-family homes; and four single-family homes acquired through foreclosure
      (with an aggregate fair value of $36,000). At March 31, 2008, the Company had
      $719,000 in loans classified as special mention. This category includes assets
      which do not currently expose us to a sufficient degree of risk to warrant
      classification, but do possess credit deficiencies or potential weaknesses
      deserving our close attention. * *Of
      the substandard assets, one loan exceeded a 90% loan-to-value ratio and that
      loan is covered by private mortgage insurance.*








13


**Kentucky
      First Federal Bancorp**





**MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION**


**AND
      RESULTS OF OPERATIONS (continued)**





Discussion
      of Financial Condition Changes from June 30, 2007 to March 31,
      2008 (continued)





***Non-Performing
      Loans (continued)***


At
      March
      31, 2008, no loans were classified as doubtful or loss for regulatory
      purposes.





***Investment
      and Mortgage-Backed Securities*** *:* At March
      31, 2008, the Company’s investment and mortgage-backed securities had decreased
      $41.7 million or 57.2% to $31.2 million. This decrease was due primarily to
      the
      maturity and/or call of $40.9 million of investment securities and repayment
      of
      principal on mortgage-backed securities which was partially offset by a net
      increase of $361,000 in the market value of investments and mortgage-backed
      securities held as available for sale. Since March 31, 2008, no investments
      have
      been called. Approximately $16.0 million of the Company’s remaining investment
      and agency securities are scheduled to mature within the next three
      years.





***Liabilities:*** **** At
      March
      31, 2008, the Company’s liabilities totaled $193.2 million, a decrease of $14.3
      million, or 6.9%, from total liabilities at June 30, 2007. The decrease in
      liabilities was attributed primarily to an $11.6 million, or 17.8%, decrease
      in
      Federal Home Loan Bank advances , which decreased to $53.6 million at March
      31,
      2008. Somewhat supplementing the decrease in advances was a decrease of $2.6
      million or 1.8%, in deposits, which totaled $137.3 million at March 31, 2008.
      Of
      the $53.6 million in advances, approximately $13.0 million were in overnight
      advances. As stated previously, management plans to continue reducing the level
      of Federal Home Loan Bank advances as lower-yielding investment securities
      mature over the next three years.





***Shareholders’
      Equity:*** At March
      31, 2008, the Company’s shareholders’ equity totaled $60.3 million, a decrease
      of $1.1 million or 1.8% from the June 30, 2007 total. The primary reason for
      the
      decrease in shareholders’ equity is the acquisition of $2.1 million of treasury
      shares at an average cost of $10.03 per share.





Comparison
      of Operating Results for the Nine-Month Periods Ended March 31, 2008 and
      2007





General





Net
      earnings totaled $624,000 for the nine months ended March 31, 2008, a decrease
      of $25,000, or 3.9% from the $649,000 in net earnings for the same period in
      2007. The decrease was primarily attributable to a decline in net interest
      income.





Net
      Interest Income





Net
      interest income declined $126,000 or 3.0% to $4.1 million for the nine month
      period ended March 31, 2008, compared to the 2007 period, due to the cost of
      funds increasing at a faster pace than interest income. Interest income
      increased by $329,000, or 3.4%, to $10.0 million, while interest expense
      increased $455,000 or 8.3% to $5.9 million for the nine months ended March
      31,
      2008. The growth in interest expense was attributable to increased costs for
      both deposits and advances.




14





**Kentucky
      First Federal Bancorp**





**MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION**


**AND
      RESULTS OF OPERATIONS (continued)**





Comparison
      of Operating Results for the Nine-Month Periods Ended March 31, 2008 and
      2007 (continued)





Net
      Interest Income (continued)





Interest
      expense on deposits increased $404,000 or 12.2% to $3.7 million, while interest
      expense on advances increased $51,000, or 2.4%, to $2.2 million for the 2008
      period compared to the prior year period. The increase in interest expense
      on
      deposits was due primarily to an increase in the average rate paid on deposits
      as the average balance of deposits outstanding declined for the nine-month
      periods year over year. The average rate paid on deposits increased 41 basis
      points to 3.69% for the nine month period ended March 31, 2008, while the
      average balance outstanding declined only $32,000 to remain atr $139.1 million
      for the both periods. The increase in interest expense on advances was
      attributable to an increase in the average balance outstanding, as the average
      rate paid on those advances declined period to period. The average balance
      of
      advances outstanding increased $4.7 million, or 7.7%, to $65.8 million for
      the
      nine month period ended March 31, 2008. The average rate paid on advances
      decreased by 24 basis points to 4.47% for the 2008 nine month period. Net
      interest margin decreased by 16 basis points to 2.15% for the nine months ended
      March 31, 2008, compared to 2.31% for the comparable 2008 period.





Provision
      for Losses on Loans





The
      Company charges a provision for losses on loans to earnings to bring the total
      allowance for loan losses to a level considered appropriate by management based
      on historical experience, the volume and type of lending conducted by the Banks,
      the status of past due principal and interest payments, general economic
      conditions, particularly as such conditions relate to the Banks’ market areas
      and other factors related to the collectibility of the Banks’ loan portfolio.
      The Company recorded a provision for losses on loans of $12,000 during the
      nine
      months ended March 31, 2008, while no provision was recorded for the nine months
      ended March 31, 2007. Based on management’s analysis of the loan portfolio, it
      was determined that the Allowance for Loan and Lease Losses was slightly
      underfunded and an addition during the three months ended March 31, 2008 was
      appropriate. Still, the overall level of nonperforming loans, discussed above
      (See “Critical Accounting Policies,”) remains relatively stable. There can be no
      assurance that the loan loss allowance will be adequate to absorb unidentified
      losses on loans in the portfolio, which could adversely affect the Company’s
      results of operations.





Other
      Income





Other
      income totaled $133,000 for the nine months ended March 31, 2008, a decrease
      of
      $1,000 from the same period in 2007.





General,
      Administrative and Other Expense





General,
      administrative and other expense totaled $3.3 million for the nine months ended
      March 31, 2008, a decrease of $100,000, or 3.0%, compared to the same period
      in
      2007. The decrease was due primarily to a decrease in employee compensation
      and
      benefits, which totaled $2.2 million for the nine months ended March 31, 2008,
      a
      decrease of $114,000, or 4.9%, from the same period in 2007. The decrease in
      employee compenation and benefits is primarily related to lower levels of
      retirement expense and slightly reduced employee health insurance cost.





15





**Kentucky
      First Federal Bancorp**





**MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION**


**AND
      RESULTS OF OPERATIONS (continued)**





Comparison
      of Operating Results for the Nine-Month Periods Ended March 31, 2008 and
      2007 (continued)





Federal
      Income Taxes





The
      provision for federal income taxes totaled $290,000 for the nine months ended
      March 31, 2008, a decrease of $14,000, or 4.6%, compared to the same period
      in
      2007. The effective tax rates were 31.7% and 31.9% for the nine-month periods
      ended March 31, 2008 and 2007, respectively.





Comparison
      of Operating Results for the Three-Month Periods Ended March 31, 2008 and
      2007





General





Net
      earnings totaled $261,000 for the three months ended March 31, 2008, an increase
      of $50,000, or 23.7% from the $211,000 in net earnings for the same period
      in
      2007. The increase was primarily attributable to an increase in net interest
      income and a slight decrease in general, administrative and other
      expense.





Net
      Interest Income





Net
      interest income increased $66,000 or 4.9% to $1.4 million for the three month
      period ended March 31, 2008, compared to the 2007 period, due to decreased
      cost
      of funds. Interest income stayed constant at $3.3 million, while interest
      expense decreased $66,000 or 3.5% to $1.8 million for the three months ended
      March 31, 2008. The decrease in interest expense was attributable primarily
      to
      decreased costs for advances.





Interest
      expense on deposits increased $45,000 or 3.9% to $1.2 million, while interest
      expense on advances decreased $111,000, or 15.1%, to $622,000 for the 2008
      quarter compared to the prior year quarter. The increase in interest expense
      on
      deposits was due an increase in the average rate paid on deposits, as the
      average balance of deposits outstanding declined for the quarterly periods
      year
      over year. The average rate paid on deposits increased 9 basis points to 3.52%
      for the three month period ended March 31, 2008, while the average balance
      outstanding declined 0.1% to $137.7 million for the current quarter. The
      decrease in interest expense on advances was attributable to both a decrease
      in
      the average balance outstanding as well as a decrease in the average rate paid.
      On those advances. The average balance of advances outstanding decreased $1.9
      million, or 3.1%, to $61.0 million for the three month period ended March 31,
      2008. The average rate paid on advances decreased 58 basis points to 4.1% for
      the 2008 quarter. Net interest margin increased by 14 basis points to 2.38%
      for
      the three months ended March 31, 2008, compared to 2.24% for the comparable
      2007
      quarter.





Provision
      for Losses on Loans





The
      Company charges a provision for losses on loans to earnings to bring the total
      allowance for loan losses to a level considered appropriate by management based
      on historical experience, the volume and type of lending conducted by the Banks,
      the status of past due principal and interest payments, general economic
      conditions, particularly as such conditions relate to the Banks’ market areas
      and other factors related to the collectibility of the Banks’ loan portfolio.
      The Company recorded a provision for losses on loans of $12,000 during the
      three
      months ended March 31, 2008. The Company recorded no provision during the three
      months ended March 31, 2007. Based on management’s analysis of the loan
      portfolio, it was determined that the Allowance for Loan and Lease Losses was
      slightly underfunded and an addition during the three months ended March 31,
      2008 was appropriate. Still, the overall level of nonperforming loans, discussed
      above (See “Critical Accounting Policies,”) remains relatively stable. There can
      be no assurance that the loan loss allowance will be adequate to absorb
      unidentified losses on loans in the portfolio, which could adversely affect
      the
      Company’s results of operations.





16


**Kentucky
      First Federal Bancorp**





**MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION**


**AND
      RESULTS OF OPERATIONS (continued)**





Comparison
      of Operating Results for the Three-Month Periods Ended March 31, 2008 and
      2007 (continued)





Other
      Income





Other
      income totaled $45,000 for the three months ended March 31, 2008, a decrease
      of
      $6,000 from the same period in 2007. The decrease in the 2008 period is
      attributable to a nonreoccuring gain on sale of real estate acquired through
      foreclosure, which was recognized in the 2007 period.





General,
      Administrative and Other Expense





General,
      administrative and other expense totaled $1.1 million for the three months
      ended
      March 31, 2008, a decrease of $28,000, or 2.5%, compared to the same period
      in
      2007. This decrease was due primarily to a decrease in employee compensation
      and
      benefits, which totaled $710,000 for the three months ended March 31, 2008,
      a
      decrease of $22,000, or 3.0%, from the same period in 2007. The decrease in
      employee compensation and benefits is related to lower retirement expense.
      The
      Company has experienced somewhat favorable results with regard to its defined
      benefit retirement plan, which has translated into lower cost
      recognition.





Federal
      Income Taxes





The
      provision for federal income taxes totaled $124,000 for the three months ended
      March 31, 2008, an increase of $26,000, or 26.5%, compared to the same period
      in
      2007. The effective tax rates were 32.2% and 31.7% for the three-month periods
      ended March 31, 2008 and 2007, respectively.








17


**Kentucky
      First Federal Bancorp**





**MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION**


**AND
      RESULTS OF OPERATIONS (CONTINUED)**





ITEM
      3: Quantitative
      and Qualitative Disclosures About Market Risk





There
      has
      been no material change in the Company’s market risk since the disclosure
      included under the heading “Management’s Discussion and Analysis of Financial
      Condition and Results of Operations - Asset and Liability Management” in the
      Company’s Form 10-K filed September 28, 2007.





ITEM
      4: Controls
      and Procedures





The
      Company’s Chief Executive Officer and Chief Financial Officer have evaluated the
      Company’s disclosure controls and procedures (as defined under Rules 13a-15(e)
      and 15d-15(e) of the Securities Exchange Act of 1934, as amended) as of the
      end
      of the period covered by this report. Based upon that evaluation, the Chief
      Executive Officer and Chief Financial Officer have concluded that the Company’s
      disclosure controls and procedures are effective. During the quarterly period
      ended March 31, 2008, there were no changes in the Company’s internal control
      over financial reporting which materially affected, or are reasonably likely
      to
      materially affect, the Company’s internal controls over financial
      reporting.








18


**Kentucky
      First Federal Bancorp**





PART
      II








ITEM
              1.
            Legal
                Proceedings




Not
      applicable.





ITEM
              1A.
            Risk
                Factors





The
      Registrant’s risk factors have not changed from those set forth in the Annual
      Report on Form 10-K.





ITEM
              2.
            Unregistered
                Sales of Equity Securities and Use of
                Proceeds




(c)  The
      following table sets forth information regarding Company’s repurchases of its
      common stock during the quarter ended March 31, 2008.





Total
                # ofAverage
            
            shares
                purchased
            
            Maximum
                # of sharesTotal
            
            price
                paid
            
            as
                part of publicly
            
            that
                may yet be#
                of shares
            
            per
                share
            
            announced
                plans
            
            purchased
                underPeriod
            
            purchased
            
            (incl
                commissions)
            
            or
                programs
            
            the
                plans or programsJanuary
                1-31, 2008
            
            
            30,000
            
            $
            9.93
            
            
            30,000
            
            
            12,100February
                1-29, 2008
            
            
            17,000
            
            $
            10.08
            
            
            17,000
            
            
            138,000March
                1-31, 2008
            
            
            15,000
            
            $
            10.13
            
            
            15,000
            
            
            123,000





(1) 
      On August 17, 2007, the Company announced a program to repurchase up to 150,000
      shares of its Common Stock.  This program was terminated on February 13,
      2008 when the Company completed the repurchase of substantially all shares
      authorized under this program, and announced another program to repurchase
      up to
      150,000 shares of its Common Stock.




ITEM
              3.
            Defaults
                Upon Senior Securities




Not
      applicable.





ITEM
              4.
            Submission
                of Matters to a Vote of Security
                Holders




None.




19





**Kentucky
      First Federal Bancorp**





PART
      II
      (continued)





ITEM
              5.
            Other
                Information




None.





ITEM
                6.
              Exhibits




31.1  CEO
      Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of
      2002


31.2  CFO
      Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of
      2002


32.1  CEO
      Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of
      2002


32.2  CFO
      Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of
      2002








20


**Kentucky
      First Federal Bancorp**





SIGNATURES




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







KENTUCKY
                FIRST FEDERAL BANCORPDate:                         
                May 14, 2008
            By:
            /s/Tony
                D. WhitakerTony
                D. WhitakerChairman
                of the Board and Chief Executive
                Officer





Date:                         
                May 14, 2008
            By:
            /s/R.
                Clay HuletteR.
                Clay HuletteVice
                President and Chief Financial
                Officer








21