UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

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

                  For the quarterly period ended March 31, 2001

                                       OR

[  ]     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934.


                         Commission File Number 0-18832

                 First Federal Financial Corporation of Kentucky
                 -----------------------------------------------
             (Exact Name of Registrant as specified in its charter)

            Kentucky                                     61-1168311
          ------------                                 --------------
   (State or other jurisdiction               (IRS Employer Identification No.)
 of incorporation or organization)

                                 2323 Ring Road
                          Elizabethtown, Kentucky 42701
                    (Address of principal executive offices)
                                   (Zip Code)

                                 (270) 765-2131
              (Registrant's telephone number, including area code)

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 90 days.

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

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

              Class                      Outstanding as of April 30, 2001
            -----------                 ------------------------------------

            Common Stock                          3,755,235 shares



<PAGE>




                 FIRST FEDERAL FINANCIAL CORPORATION OF KENTUCKY


                                      INDEX


PART I - FINANCIAL INFORMATION                                      Page Number

 Item 1 -Consolidated Financial Statements and Notes to Consolidated
         Financial Statements                                           3-11

 Item 2 -Management's Discussion and Analysis of the Consolidated
         Statements of Financial Condition and Results of Operations   12-22

 Item 3 -Quantitative and Qualitative Disclosures about Market Risk    20-22

PART II - OTHER INFORMATION                                               23

SIGNATURES                                                                24

                                       2
<PAGE>



                 FIRST FEDERAL FINANCIAL CORPORATION OF KENTUCKY
                 Consolidated Statements of Financial Condition

                                                      (Unaudited)
                                                        March 31,     June 30,
                                         ASSETS           2001          2000
                                                          ----          ----
                                                        (Dollars in thousands)

Cash and due from banks                                $ 13,874      $ 11,310
Interest bearing deposits                                12,184         3,669
                                                         ------        ------
           Total cash and cash equivalents               26,058        14,979
Securities available-for-sale                             1,907         2,048
Securities held-to-maturity (fair value of $30,080
   and $41,195 at March 2001 and June 2000)              29,935        43,134
Loans receivable, less allowance for loan losses
   of $2,716 (March) and $2,252 (June)                  513,464       471,231
Federal Home Loan Bank stock                              5,741         4,081
Premises and equipment                                   11,571        11,709
Real estate owned:
  Acquired through foreclosure                              107           -
  Held for development                                      721           446
Repossessed assets                                           77           -
Excess of cost over net assets acquired                   9,423        10,047
Accrued interest receivable                               1,782         2,032
Other assets                                              1,092         1,078
                                                        -------      --------

          TOTAL ASSETS                                 $601,878      $560,785
                                                       ========      ========

                          LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES:
Deposits:
   Non-interest bearing                                $ 19,017      $ 16,822
   Interest bearing                                     444,997       406,937
                                                        -------       -------
             Total Deposits                             464,014       423,759
Advances from Federal Home Loan Bank                     78,963        80,339
Accrued interest payable                                  1,890         1,129
Accounts payable and other liabilities                    1,358         1,962
Deferred income taxes                                     2,030         1,915
                                                        -------       -------

          TOTAL LIABILITIES                             548,255       509,104
                                                        -------       -------

STOCKHOLDERS' EQUITY:
 Serial preferred stock, 5,000,000 shares
     authorized and unissued                                -             -
 Common stock, $1 par value per share;
      authorized 10,000,000 shares; issued and
      outstanding, 3,756,000 shares in June and
      3,755,000 shares in March                           3,755         3,756
 Additional paid-in capital                                 -             -
 Retained earnings                                       49,530        47,481
 Accumulated other comprehensive
    income, net of tax                                      338           444
                                                         ------        ------

          TOTAL STOCKHOLDERS' EQUITY                     53,623        51,681
                                                       --------      --------
          TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY   $601,878      $560,785
                                                       ========      ========

                 See notes to consolidated financial statements.

                                       3

<PAGE>

                 FIRST FEDERAL FINANCIAL CORPORATION OF KENTUCKY
                        Consolidated Statements of Income
                                   (Unaudited)
                  (Dollars in thousands, except per share data)
<TABLE>
<CAPTION>

                                                Three Months Ended           Nine Months Ended
                                                     March 31,                    March 31,
                                                2001           2000          2001          2000
<S>                                          <C>            <C>           <C>           <C>
 Interest Income:
   Interest and fees on loans                 $10,759        $ 8,946       $31,171       $25,858
   Interest and dividends on investments
     and deposits                                 903            798         2,610         2,409
                                               ------          -----        ------        ------
          Total interest income                11,662          9,744        33,781        28,267
                                               ------          -----        ------        ------
 Interest Expense:
   Deposits                                     5,666          4,615        16,339        13,189
   Federal Home Loan Bank advances              1,267            753         4,374         1,804
                                                -----          -----        ------        ------
          Total interest expense                6,933          5,368        20,713        14,993
                                                -----          -----        ------        ------
 Net interest income                            4,729          4,376        13,068        13,274
 Provision for loan losses                        285             90           786           270
                                                -----          -----        ------        ------
 Net interest income after provision
   for loan losses                              4,444          4,286        12,282        13,004
                                                -----          -----        ------        ------

Non-interest Income:
   Customer service fees on deposit accounts      663            467         1,862         1,409
   Secondary mortgage market closing fees         117             56           343           280
   Gain on sale of investments                     -             152           696           457
   Brokerage and insurance commissions            175            119           498           352
   Other income                                   157            191           490           460
                                                -----           ----         -----         -----
         Total non-interest income              1,112            985         3,889         2,958
                                                -----           ----         -----         -----
Non-interest Expense:
   Employee compensation and benefits           1,658          1,490         4,726         4,222
   Office occupancy expense and equipment         366            323         1,089         1,002
   FDIC insurance premium                          21             21            64           137
   Marketing and advertising                      125            128           376           385
   Outside services and data processing           372            303         1,035           908
   State franchise tax                            109            102           315           301
   Amortization of intangibles                    208            208           624           624
   Other expense                                  588            549         1,822         1,731
                                                -----          -----         -----         -----
         Total non-interest expense             3,447          3,124        10,051         9,310
                                                -----          -----        ------         -----

Income before income taxes                      2,109          2,147         6,120         6,652
Income taxes                                      705            744         2,022         2,211
                                               ------         ------         -----         -----
Net income                                     $1,404         $1,403        $4,098        $4,441
                                               ======         ======        ======        ======
Earnings per share:
         Basic                                $  0.37        $  0.36       $  1.09       $  1.12
         Diluted                              $  0.37        $  0.36       $  1.09       $  1.12

</TABLE>

                 See notes to consolidated financial statements.

                                       4

<PAGE>

                 FIRST FEDERAL FINANCIAL CORPORATION OF KENTUCKY
                 Consolidated Statements of Comprehensive Income
                                   (Unaudited)
                             (Dollars in thousands)
<TABLE>
<CAPTION>


                                                    Three Months Ended         Nine Months Ended
                                                         March 31,                  March 31,
                                                         ---------                  ---------
                                                    2001           2000        2001          2000
                                                    ----           ----        ----          ----
<S>                                               <C>            <C>         <C>           <C>
Net Income                                         $1,404         $1,403      $4,098        $4,441
Other comprehensive income (loss), net of tax:
     Change in unrealized gain (loss)
        on securities                                 (21)           (76)        353          (306)
     Reclassification of realized amount                -           (100)       (459)         (302)
                                                    ------        ------       -----         -----
     Net unrealized gain (loss) recognized in
        Comprehensive income                          (21)          (176)       (106)         (608)
                                                   ------         ------       -----        ------
Comprehensive Income                               $1,383         $1,227      $3,992        $3,833
                                                   ======         ======      ======        ======
</TABLE>



                 See notes to consolidated financial statements.

                                       5

<PAGE>



                 FIRST FEDERAL FINANCIAL CORPORATION OF KENTUCKY
           Consolidated Statements of Changes in Stockholders' Equity
                    For the Nine Months Ended March 31, 2001
                                   (Unaudited)
                                 (In thousands)




<TABLE>
<CAPTION>
                                                                                           Accumulated Other
                                                          Additional                         Comprehensive
                                                          Paid - in        Retained             Income,
                              Shares        Amount         Capital         Earnings           Net of Tax        Total
                              ------        ------        ----------       --------        ----------------     -----
<S>                           <C>         <C>            <C>             <C>                <C>               <C>
Balance, June 30, 2000         3,756       $ 3,756        $    -          $47,481            $  444            $51,681
Net income                       -              -              -            4,098                -               4,098
Exercise of stock options          1             1              7              -                 -                   8
Net change in unrealized
  gains (losses) on
  securities available-
  for-sale, net of tax           -              -              -               -               (106)              (106)
Cash dividends declared
   ($.54 per share)              -              -              -           (2,028)              -               (2,028)
Stock repurchased                 (2)           (2)            (7)            (21)              -                  (30)
                               -----       -------        -------         -------            ------            -------
Balance, March 31, 2001        3,755       $ 3,755        $    -          $49,530            $  338            $53,623
                               =====       =======        =======         =======            ======            =======

</TABLE>

                 See notes to consolidated financial statements.

                                       6
<PAGE>



                 FIRST FEDERAL FINANCIAL CORPORATION OF KENTUCKY
                      Consolidated Statements of Cash Flows
                                   (Unaudited)
                             (Dollars in thousands)
                                                            Nine Months Ended
                                                                 March 31,
                                                            2001          2000
                                                            ----          ----
Operating Activities:
 Net income                                              $ 4,098        $ 4,441
 Adjustments to reconcile net income to net
    cash provided by operating activities:
    Provision for loan losses                                786            270
    Depreciation of premises and equipment                   841            757
    Net change in deferred loan fees and costs               232            112
    Federal Home Loan Bank stock dividends                  (281)          (116)
    Amortization of acquired intangible assets               624            624
    Amortization and accretion on securities                 (45)           (46)
    Gain on sale of investments available-for-sale          (696)          (457)
    Gain on sale of real estate held for development          (9)            -
    Deferred taxes                                           170            204
    Changes in:
      Interest receivable                                    250            197
      Other assets                                           (14)             5
      Interest payable                                       761             30
      Accounts payable and other liabilities                (595)          (421)
                                                           -----          -----
Net cash provided by operating activities                  6,122          5,600
                                                           -----          -----
Investing Activities:
  Sales of securities available-for-sale                     708            462
  Purchases of securities available-for-sale                 (32)             -
  Purchases of securities held-to-maturity                     -         (5,000)
  Maturities of securities held-to-maturity               13,244          6,299
  Net increase in loans                                  (43,435)       (49,116)
  Purchase of Federal Home Loan Bank stock                (1,379)             -
  Net purchases of premises and equipment                   (703)          (652)
  Purchase of real estate held for development              (275)             -
                                                         -------        -------
Net cash used in investing activities                    (31,872)       (48,007)
                                                         -------        -------
Financing Activities:
  Net increase in deposits                                40,255         27,254
  Advances from Federal Home Loan Bank                    32,590         52,844
  Repayments to Federal Home Loan Bank                   (33,966)       (25,151)
  Dividends paid                                          (2,028)        (2,127)
  Proceeds from stock options exercised                        8              5
  Common stock repurchased                                   (30)        (7,549)
                                                         -------         ------
Net cash provided by financing activities                 36,829         45,276
                                                          ------         ------

Increase in cash and cash equivalents                     11,079          2,869
Cash and cash equivalents, beginning of period            14,979         11,891
                                                          ------         ------
Cash and cash equivalents, end of period                 $26,058        $14,760
                                                         =======        =======


                 See notes to consolidated financial statements.

                                       7

<PAGE>

                 FIRST FEDERAL FINANCIAL CORPORATION OF KENTUCKY

                   Notes to Consolidated Financial Statements


1.       BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of  Presentation  - The  consolidated  financial  statements  include  the
accounts of First Federal  Financial  Corporation of Kentucky (the  Corporation)
and its wholly owned  subsidiary,  First Federal  Savings Bank of  Elizabethtown
(the  Bank),  and  its  wholly  owned  subsidiaries,   First  Service  Corp.  of
Elizabethtown  and  First  Heartland  Mortgage.  All  significant   intercompany
transactions and balances have been eliminated.

The accompanying  unaudited consolidated financial statements have been prepared
in  accordance  with  generally  accepted  accounting   principles  for  interim
financial  information  and with the  instructions  to Form  10-Q and Rule 10 of
Regulation  S-X.  Accordingly,  they do not include all of the  information  and
footnotes  required by generally  accepted  accounting  principles  for complete
financial statements. In the opinion of management,  all adjustments (consisting
of normal recurring accruals)  considered necessary for a fair presentation have
been included.  Operating  results for the  three-month  and nine-month  periods
ending March 31, 2001 are not necessarily  indicative of the results that may be
expected for the year ended June 30, 2001. For further information, refer to the
consolidated  financial  statements  and  footnotes  thereto  included  in First
Federal's annual report on Form 10-K for the year ended June 30, 2000.

New Accounting  Pronouncements - On July 1, 2000, the Corporation  adopted a new
accounting  standard  that will require all  derivatives  to be recorded at fair
value.  Unless  designated  as  hedges,  changes in these  fair  values  will be
recorded  in the income  statement.  Fair value  changes  involving  hedges will
generally  be  recorded by  offsetting  gains and losses on the hedge and on the
hedged  item,  even if the  fair  value  of the  hedged  item  is not  otherwise
recorded.  The adoption of this new  standard did not have a material  effect on
the Corporation's financial statements.

Reclassifications  -  Certain  amounts  have  been  reclassified  in  the  prior
financial  statements  to conform to the  current  period  classifications.  The
reclassifications  have no  effect  on net  income  or  stockholders'  equity as
previously reported.


                                       8
<PAGE>


2.       SECURITIES

The amortized cost basis and fair values of securities are as follows:
<TABLE>
<CAPTION>

                                                           Gross        Gross
                                            Amortized    Unrealized   Unrealized
                                               Cost        Gains        Losses     Fair Value
                                            ---------    ----------   ----------   ----------
                                                          (Dollars in thousands)
<S>                                        <C>           <C>          <C>         <C>
  Securities available-for-sale:
    March 31, 2001:
        Equity securities                   $   385       $ 560        $ (53)      $   892
        Obligation of states and political
           subdivisions                       1,010           5          -           1,015
                                            -------       -----        -----        ------

             Total available-for-sale       $ 1,395       $ 565        $ (53)      $ 1,907
                                            =======       =====        =====        ======

  Securities held-to-maturity:
    March 31, 2001:
       U.S. Treasury and agencies           $28,894       $ 183        $ (26)      $29,051
       Mortgage-backed securities             1,041           4          (16)        1,029
                                            -------       -----         ----       -------

            Total held-to-maturity          $29,935       $ 187        $ (42)      $30,080
                                            =======       =====        =====       =======
</TABLE>


<TABLE>
<CAPTION>
                                                           Gross        Gross
                                           Amortized     Unrealized   Unrealized
                                              Cost         Gains        Losses     Fair Value
                                           ---------     ----------   ----------   ----------
                                                          (Dollars in thousands)
 <S>                                       <C>           <C>          <C>          <C>
  Securities available-for-sale:
    June 30, 2000:
       Equity securities                    $   365       $ 807        $   (67)     $ 1,105
       Obligation of states and political
          subdivisions                        1,010          -             (67)         943
                                            -------       -----        --------     -------
            Total available-for-sale        $ 1,375       $ 807        $   (134)    $ 2,048
                                            =======       =====        ========     =======

  Securities held-to-maturity:
    June 30, 2000:
       U.S. Treasury and agencies           $41,860       $ 65         $(1,989)     $39,936
       Mortgage-backed securities             1,274          7             (23)       1,258
                                            -------       ----        --------      -------

            Total held-to-maturity          $43,134       $ 72         $(2,012)     $41,194
                                            =======       ====         =======      =======
</TABLE>



                                       9

<PAGE>

3.       LOANS RECEIVABLE

         Loans receivable are summarized as follows:

                                                  March 31,           June 30,
                                                    2001               2000
                                                    ----               ----
                                                     (Dollars in thousands)

         Commercial                               $ 15,360           $ 15,769
         Real estate commercial                     89,106             65,244
         Real estate construction                   10,337              8,367
         Real estate mortgage                      317,121            311,756
         Consumer and home equity                   65,051             59,744
         Indirect consumer                          21,611             15,186
                                                   -------            -------
               Total loans                         518,586            476,066
                                                   -------            -------
         Less:
           Net deferred loan origination fees       (2,406)            (2,583)
           Allowance for loan losses                (2,716)            (2,252)
                                                  --------             ------
                                                    (5,122)            (4,835)
                                                  --------             ------
         Loans, net                               $513,464           $471,231
                                                  ========           ========



The following table sets forth the changes in the allowance for loan losses:
<TABLE>
<CAPTION>

                                          Three Months Ended         Nine Months Ended
                                              March 31,                   March 31,
                                         -----------------------------------------------
                                         2001          2000          2001          2000
                                         ----          ----          ----          ----
                                                     (Dollars in thousands)
    <S>                               <C>           <C>           <C>           <C>
     Allowance for loan losses:
       Balance, beginning of period    $ 2,541       $ 2,241       $ 2,252       $ 2,108
       Provision for loan losses           285            90           786           270
       Charge-offs                        (122)          (29)         (361)          (81)
       Recoveries                           12             2            39             7
                                       -------       -------       -------       -------
       Balance, end of period          $ 2,716       $ 2,304       $ 2,716       $ 2,304
                                       =======       =======       =======       =======
</TABLE>


Investment in impaired loans is summarized  below.  There were no impaired loans
for the periods presented without an allowance allocation.

                                         March 31,            June 30,
                                           2001                 2000
                                           ----                 ----
                                             (Dollars in thousands)

End of period impaired loans              $  739               $1,562
Amount of allowance for loan
  loss allocated                              59                  117






                                       10
<PAGE>



4.         BORROWINGS

Deposits  are the  primary  source  of funds  for First  Federal's  lending  and
investment  activities and for its general business purposes.  The Bank can also
use advances  (borrowings)  from the FHLB of Cincinnati to supplement its supply
of lendable funds, meet deposit  withdrawal  requirements and to extend the term
of its liabilities.  Advances from the FHLB are typically  secured by the Bank's
stock in the FHLB and  substantially  all of the Bank's first mortgage loans. At
March 31, 2001 First Federal had $78.9 million in advances  outstanding from the
FHLB and the capacity to increase its borrowings an additional $222 million.


5.       EARNINGS PER SHARE

Earnings  Per  Common  Share - Basic  earnings  per  common  share is net income
divided by the weighted average number of common shares  outstanding  during the
period.  Diluted  earnings  per common  share  include  the  dilutive  effect of
additional   potential   common  shares   issuable   under  stock   options.   A
reconciliation  of the numerators and  denominators of the basic and diluted EPS
is as follows:
<TABLE>
<CAPTION>

                                       Three Months Ended          Nine Months Ended
                                             March 31,                  March 31,
                                             ---------                  ---------
                                         2001        2000          2001          2000
                                         ----        ----          ----          ----
                                                       (In thousands)
  <S>                                  <C>         <C>           <C>           <C>
   Net income available
      to common shareholders            $1,404      $1,403        $4,098        $4,441
                                        ======      ======        ======        ======

   Basic EPS:
      Weighted average common shares     3,755       3,849         3,755         3,950
                                         =====       =====         =====        ======

   Diluted EPS:
      Weighted average common shares     3,755       3,849         3,755         3,950
      Dilutive effect of stock options       6          15             7            30
                                         -----       -----         -----         -----
      Weighted average common and
        incremental shares               3,761       3,864         3,762         3,980
                                         =====       =====         =====         =====

   Earnings Per Share:
       Basic                             $0.37       $0.36         $1.09         $1.12
                                         =====       =====         =====         =====

       Diluted                           $0.37       $0.36         $1.09         $1.12
                                         =====       =====         =====         =====


</TABLE>

                                       11

<PAGE>


            MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                            AND RESULTS OF OPERATIONS

GENERAL

First Federal Financial Corporation of Kentucky ("Corporation") is the parent to
its  wholly  owned  subsidiary,  First  Federal  Savings  Bank of  Elizabethtown
("Bank").  The Bank has operations in the Kentucky communities of Elizabethtown,
Radcliff, Bardstown, Munfordville,  Shepherdsville, Mt. Washington, Brandenburg,
Flaherty, and Hillview. The Bank's activities include the acceptance of deposits
for checking,  savings and time deposit  accounts,  making secured and unsecured
loans,  investing in securities and trust services.  The Bank's lending services
include the origination of real estate, commercial and consumer loans. Operating
revenues are derived  primarily  from interest and fees on domestic real estate,
commercial  and consumer  loans,  and from  interest on securities of the United
States  Government  and  Agencies,  states,  and  municipalities.   The  primary
regulator for First Federal is the Office of Thrift Supervision (OTS).

The following  discussion  and analysis  covers any  significant  changes in the
financial  condition since June 30, 2000 and any material changes in the results
of operations for the three-month and nine-month periods ending, March 31, 2001.
This  discussion and analysis  should be read in conjunction  with  "Managements
Discussion  and  Analysis of  Financial  Condition  and  Results of  Operations"
included in the 2000 Annual Report to Shareholders.

PRELIMINARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Statements  contained in this report that are not statements of historical  fact
constitute  forward-looking  statements within the meaning of Section 21E of the
Securities  Exchange  Act of 1934,  as  amended.  In  addition,  forward-looking
statements  may be made in future filings by the Company with the Securities and
Exchange Commission,  in press releases, and in oral and written statements made
by or with the approval of the Company.  Forward-looking statements include, but
are not limited to: (1)  projections  of revenues,  income or loss,  earnings or
loss per share,  capital  structure and other financial items; (2) statements of
plans and objectives of the Company or its management or Board of Directors; (3)
statements  regarding future events,  actions or economic  performance;  and (4)
statements of assumptions underlying such statements.  Words such as "believes,"
"anticipates,"   "expects,"   "intends,"   "plans,"   "targeted,"   and  similar
expressions are intended to identify forward-looking  statements but are not the
exclusive means of identifying such statements.

Forward-looking statements involve risks and uncertainties that may cause actual
results to differ  materially from those indicated by such  statements.  Some of
the events or circumstances that could cause actual results to differ from those
indicated by forward-looking statements include, but are not limited to, changes
in economic conditions in the markets served by the Corporation, in Kentucky and
the surrounding region, or in the nation as a whole;  changes in interest rates;
the impact of legislation and  regulation;  the  Corporation's  ability to offer
competitive  banking products and services;  competition from other providers of
financial services, the continued growth of the markets in which the Corporation
operates;  and the  Corporation's  ability  to expand  into new  markets  and to
maintain profit margins in the face of pricing pressure. All of these events and
circumstances  are  difficult  to  predict  and  many of  them  are  beyond  the
Corporation's control.

OVERVIEW

Net income for the quarter  ended  March 31, 2001 was $1.4  million or $0.37 per
share  diluted  compared to $1.4 million or $0.36 per share diluted for the same
period in 2000.  During the 2000 quarter,  the Corporation sold investments with
gains of $152,000.  Excluding this gain, earnings per share for the 2000 quarter
would have been $0.34 per share diluted compared to the recently  completed 2001
quarter of $0.37 per share diluted.

Net income for the nine months  ended  March 31, 2001 was $4.1  million or $1.09
per share  diluted  compared to $4.4 million or $1.12 per share  diluted for the
same  period  in  2000.  The  decline  in  earnings  is a direct  result  of the
decreasing net interest margin.  The Bank's customer deposits and borrowings are
shorter  in term than the loan and  investment  portfolio.  During  the  rapidly
rising interest rate  environment of 1999 and the first half of 2000, the Bank's
cost of funds  increased much faster than its yield on interest  earning assets.
In January 2001, the Bank restructured $75 million of its Federal Home Loan Bank
advances to secure longer term financing at lower interest rates.  The effective
interest  rate on this debt  declined  sharply from 6.6% to 4.93%,  resulting in
anticipated  future  interest  savings of  approximately  $313,000  per quarter,
compared to the  interest  cost during the six months  ended  December 31, 2000.
Management  anticipates  that the  restructuring  of advances  coupled  with the
Federal Open Market  Committee's  interest rate reductions  occurring during the
March 31,  2001  quarter  will have a positive  impact on future  earnings.  The
Bank's book value per common  share  increased  from $13.70 at March 31, 2000 to
$14.28 at March 31, 2001.

                                       12

<PAGE>

The Bank's  total  assets at March 31, 2001 grew to $601.9  million  compared to
$560.8 million at June 30, 2000. Net loans increased $42.3 million from June 30,
2000 to $513.5 million at March 31, 2001.  Real estate lending  remained  strong
across all product lines,  particularly  commercial real estate.  The commercial
real estate portfolio  increased $23.9 million while the residential real estate
portfolio  grew $5.4  million.  This growth is a result of the Bank's  continued
emphasis on the active pursuit of lending opportunities.  The Bank's dealer loan
program  increased $6.4 million while  consumer and home equity loans  increased
$5.3  million.   While  loan  growth   remained   strong,   the   percentage  of
non-performing  loans  to  total  loans  remained  low at  0.14%,  as  the  Bank
maintained its underwriting standards and continued its emphasis on secured real
estate lending.

Funding for the growth in the loan portfolio was derived from deposits. Deposits
increased  by $40.2  million to $464  million as of March 31,  2001  compared to
$423.8 million at June 30, 2000. The growth in retail  deposits was primarily in
short-term certificate of deposits and money market accounts caused in part by a
shift during recent quarters in funds from the stock market to more conservative
investments.  FHLB  advances  decreased  from $80.3  million at June 30, 2000 to
$78.9 million at March 31, 2001.

RESULTS OF OPERATIONS

Net Interest  Income-For the quarter ended March 31, 2001,  net interest  income
was $4.7  million,  up $353,000 from the $4.4 million  attained  during the 2000
quarter.  The net  interest  rate spread  decreased  from 3.15%  during the 2000
quarter  to 2.93% in the  comparable  quarter of 2001.  The Bank's net  interest
margin decreased from 3.53% during the quarter ended March 31, 2000 to 3.32% for
the 2001 period. The decrease in net interest spread and margin occurred because
the yield on interest  earning  assets  increased 33 basis points while the rate
paid on liabilities increased 55 basis points.  During the 2001 quarter, average
interest-earning  assets were $569.6 million,  an increase of $73.5 million over
the same period in 2000. Total average interest  bearing  liabilities  increased
from $455.6  million  during the quarter ended March 31, 2000 to $527.5  million
for the same period in 2001.

Net interest  income for the nine months ended March 31, 2001 was $13.1 million,
down from $13.3 million  attained during the same period of 2000. The Bank's net
interest spread decreased 54 basis points as well as the net interest margin for
the nine months  ended March 31, 2001  compared to the same period in 2000.  The
decrease in the net  interest  spread and margin  occurred  because the yield on
interest  earning  assets  increased  28 basis  points  while  the rate  paid on
liabilities increased 82 basis points.

While market interest rates have increased over the past year,  short-term rates
have  increased  more than  long-term  rates during that time  period.  This has
caused  interest-bearing  liabilities,  which are generally tied to shorter-term
market indices to reprice at higher rates than interest  earning  assets,  which
are generally tied to longer-term  indexes.  Also, the Bank's  interest  bearing
liabilities have a shorter repricing frequency and are subject to repricing at a
faster pace than its interest earning assets.  Management  expects that with the
Federal Open Market  Committee's  interest rate reductions  occurring during the
March 31, 2001 quarter,  the Bank's  overall net interest  margin and spread are
likely to improve.  These  improvements  in spread and in margin would, in turn,
increase net interest income,  even if there was no growth in the Bank's overall
loan portfolio.


                                       13
<PAGE>

Average Balance Sheet

The  following  table  provides  detailed  information  as to  average  balance,
interest  income/expense,  and rates by major balance sheet  categories  for the
three months ended March 31, 2001 and 2000.
<TABLE>
<CAPTION>

                                                              Three Months Ended March 31,
                                      -----------------------------------------------------------------------------
                                                     2001                                      2000
                                                     ----                                      ----

                                        Average                   Average       Average                    Average
                                        Balance     Interest    Yield/Cost      Balance      Interest     Yield/Cost

ASSETS                                                           (Dollars in thousands)
<S>                                 <C>           <C>            <C>         <C>           <C>             <C>
Interest earning assets:
   Equity securities                 $    935      $     8        3.42%       $  1,242      $    8          2.58%
   State and political subdivision
     Securities (1)                       997           17        6.82             947          17          7.18
   U.S. Treasury and agencies          38,656          710        7.35          41,848         674          6.44
   Mortgage-backed securities           1,037           19        7.33           1,348          23          6.82
   Loans receivable (2) (3)           516,392       10,759        8.33         444,474       8,945          8.05
   FHLB stock                           5,666          101        7.13           3,316          58          7.00
   Interest bearing deposits            5,959           54        3.62           2,923          24          3.28
                                      -------       ------        ----         -------       -----          ----
     Total interest earning assets    569,642       11,668        8.19         496,098       9,749          7.86
                                                    ------        ----                       -----          ----
Less:  Allowance for loan losses       (2,641)                                  (2,273)
Non-interest earning assets            37,493                                   36,809
                                     --------                                 --------
     Total assets                    $604,494                                 $530,634
                                     ========                                 ========

LIABILITIES AND STOCKHOLDERS' EQUITY
Interest bearing liabilities:
   Savings accounts                   $33,151       $ 225         2.71%       $ 34,938      $  222          2.54%
   NOW and money market
     accounts                          80,509         550         2.73          77,973         530          2.72
   Certificates of deposit and
     other time deposits              314,915       4,891         6.21         289,774       3,863          5.33
   FHLB Advances                       98,957       1,267         5.12          52,899         753          5.69
                                      -------      ------         ----         -------       -----          ----
    Total interest bearing
      liabilities                     527,532       6,933         5.26         455,584       5,368          4.71
                                                    -----         ----                       -----          ----
Non-interest bearing liabilities:
   Non-interest bearing deposits       17,982                                   16,915
   Other liabilities                    5,558                                    5,300
                                      -------                                   ------
     Total liabilities                551,072                                  477,799

Stockholders' equity                   53,422                                   52,835
                                      -------                                  -------
     Total liabilities and
       stockholders' equity          $604,494                                 $530,634
                                     ========                                 ========

Net interest income                                $4,735                                   $4,381
                                                   ======                                   ======
Net interest spread                                              2.93%                                     3.15%
                                                                 =====                                     =====
Net interest margin                                              3.32%                                     3.53%
                                                                 =====                                     =====
</TABLE>
-----------------------------------------------------
(1) Taxable equivalent yields are calculated assuming a 34% federal income tax
rate.
(2) Includes loan fees, immaterial in amount, in both interest income and the
calculation of yield on loans. (3) Calculations include non-accruing loans in
the average loan amounts outstanding.


                                       14


<PAGE>


Average Balance Sheet

The  following  table  provides  detailed  information  as to  average  balance,
interest  income/expense,  and rates by major balance sheet  categories  for the
nine months ended March 31, 2001 and 2000.
<TABLE>
<CAPTION>

                                                                 Nine Months Ended March 31,
                                      -----------------------------------------------------------------------------------
                                                       2001                                       2000
                                                       ----                                       ----

                                        Average                     Average       Average                    Average
                                        Balance       Interest    Yield/Cost      Balance       Interest    Yield/Cost

ASSETS                                                             (Dollars in thousands)
<S>                                   <C>           <C>             <C>         <C>         <C>              <C>
Interest earning assets:
   Equity securities                   $  1,029      $    25         3.24%       $  1,532     $    34         2.96%
   State and political subdivision
     Securities (1)                         970           50         6.87             965          50         6.91
   U.S. Treasury and agencies            40,591        2,071         6.80          41,388       2,027         6.53
   Mortgage-backed securities             1,152           64         7.41           1,445          71         6.55
   Loans receivable (2) (3)             500,234       31,171         8.31         428,457      25,858         8.05
   FHLB stock                             5,101          281         7.35           3,265         174         7.11
   Interest bearing deposits              4,976          136         3.64           3,605          70         2.59
                                        -------       ------         ----         -------      ------
     Total interest earning assets      554,053       33,798         8.13         480,657      28,284         7.85
                                                      ------         ----                      ------         ----
Less:  Allowance for loan losses         (2,449)                                   (2,206)
Non-interest earning assets              37,318                                    36,501
                                        -------                                  --------
     Total assets                      $588,922                                  $514,952
                                       ========                                  ========


LIABILITIES AND STOCKHOLDERS' EQUITY
Interest bearing liabilities:
   Savings accounts                     $33,791     $   816         3.22%        $ 35,561     $   745        2.79%
   NOW and money market
     accounts                            78,984       1,519         2.56           78,471       1,398        2.38
   Certificates of deposit and
     other time deposits                304,007      14,004         6.14          276,709      11,046        5.32
   FHLB Advances                         95,727       4,374         6.09           46,530       1,804        5.17
                                        -------      ------         ----          -------      ------        ----
     Total interest bearing
       liabilities                      512,509      20,713         5.39          437,271      14,993        4.57
                                                     ------         ----                       ------        ----
Non-interest bearing liabilities:
   Non-interest bearing deposits         17,806                                    16,879
   Other liabilities                      5,808                                     6,273
                                         ------                                    ------
     Total liabilities                  536,123                                   460,423

Stockholders' equity                     52,799                                    54,529
                                         ------                                    ------
     Total liabilities and
       stockholders' equity            $588,922                                  $514,952
                                        ========                                 ========

Net interest income                                 $13,085                                   $13,291
                                                     =======                                  =======
Net interest spread                                                  2.74%                                   3.28%
                                                                     =====                                   =====
Net interest margin                                                  3.15%                                   3.69%
                                                                     =====                                   =====
</TABLE>
-----------------------------------------------------
(1) Taxable equivalent yields are calculated assuming a 34% federal income tax
rate.
(2) Includes loan fees, immaterial in amount, in both interest income and the
calculation of yield on loans. (3) Calculations include non-accruing loans in
the average loan amounts outstanding.


                                       15

<PAGE>



Rate/Volume Analysis

The table below sets forth  certain  information  regarding  changes in interest
income and  interest  expense of the Bank for the  periods  indicated.  For each
category   of   interest-earning   assets  and   interest-bearing   liabilities,
information is provided on changes  attributable to (1) changes in rate (changes
in rate  multiplied  by old  volume);  (2)  changes in volume  (change in volume
multiplied  by old  rate);  and  (3)  changes  in  rate-volume  (change  in rate
multiplied  by change in volume).  Changes in  rate-volume  are  proportionately
allocated between rate and volume variance.
<TABLE>
<CAPTION>

                                             Three Months Ended                Nine Months Ended
                                                  March 31,                         March 31,
                                               2001 vs. 2000                     2001 vs. 2000
                                              ---------------                    -------------
                                            Increase (decrease)               Increase (decrease)
                                             Due to change in                  Due to change in
  (Dollars in thousands)
                                                               Net                                Net
                                         Rate     Volume     Change        Rate     Volume      Change

  <S>                                   <C>      <C>       <C>            <C>      <C>        <C>
   Interest income:
     Loans                               $266     $1,548    $1,814         $722     $ 4,591    $5,313
     Equity securities                                                                  (14)       (9)
     State and political subdivision
       securities                           0          0         0            0           0         0
     U.S. Treasury and agencies            26         10        36           29          15        44
     Mortgage-backed securities             3         (7)       (4)         (28)         21        (7)
     FHLB stock                             1         42        43            6         101       107
     Interest bearing deposits              2         28        30           20          46        66
                                          ---      -----     -----          ---       -----     -----
     Total interest earning assets        298      1,621     1,919          754       4,760     5,514
                                          ---      -----     -----          ---       -----     -----
   Interest expense:
      Savings accounts                      2          1         3           44          27        71
      NOW and money market accounts         2         18        20           56          65       121
      Certificates of deposit and other
         time deposits                    394        634     1,028        1,081       1,877     2,958
      FHLB advances                       (88)       602       514          285       2,285     2,570
                                          ---        ---     -----        -----       -----     -----
      Total interest bearing liabilities  310      1,255     1,565        1,466       4,254     5,720
                                          ---      -----     -----        -----       -----     -----

      Net change in net interest income  $(12)    $  366    $  354       $ (712)     $  506    $ (206)
                                         ====     ======    ======       ======      ======    ======
</TABLE>

Non-Interest  Income-Non-interest  income was $1.1 million for the quarter ended
March 31, 2001, as compared to $1.0 million for the 2000 period,  an increase of
$127,000.  During the March 2001  quarter the Bank did not report any gains from
investment sales compared to reported gains of $152,000 for the 2000 period. Fee
income from  secondary  market lending  operations  increased by $61,000 or 109%
during the 2001  period  compared  to 2000.  Customer  service  fees  charged on
deposit  accounts  increased  by $196,000 or 42% during the 2001  quarter due to
growth in accounts and deposit  relationships  with  existing  customers.  Other
sources of income such as brokerage  commissions,  loan fees, and other customer
transaction  fees also  increased  during  the 2001  period by  $22,000 or 7% as
compared to the 2000 period.

Non-interest  income was $3.9  million for the nine months ended March 31, 2001,
as compared to $3.0 million for the same period last year.  Gains on  investment
sales were  $696,000  during the 2001 period  compared to $457,000  for the 2000
period,  an increase  of  $239,000.  Customer  service  fees  charged on deposit
accounts  increased by $453,000 or 32% during the 2001 period.  Other sources of
income such as brokerage commissions,  secondary market lending operations, loan
fees, and other  customer  transaction  fees also  increased  during the 2001 as
compared to the 2000 period.

                                       16
<PAGE>


Non-Interest  Expense-Total  non-interest  expense was $3.4 million for the 2001
quarter  compared to $3.1  million for the 2000  quarter.  Non-interest  expense
increased  from $9.3  million  for the nine  months  ended March 31, 2000 to $10
million for the comparable  period in 2001. The increases for both the three and
nine months  ended March 31, 2001 were  attributable  to costs  associated  with
salaries and employee benefits, primarily health insurance.

Compensation  and  employee  benefit  expenses  increased  $168,000 for the 2001
quarter  compared to the 2000  quarter,  and  $504,000 for the nine months ended
March 31, 2001 compared to March 31, 2000.  The increase  includes  inflationary
salary  adjustments and reflects  growth in the overall  staffing level from 163
full-time  equivalent  employees at March 31, 2000 to 196  full-time  equivalent
employees at March 31, 2001.  Additional  staffing was required to achieve a new
strategic  plan  adopted by the Bank in 1999 to develop a bank-wide  service and
sales  culture.  The plan  emphasizes  expanding  account  relationships,  which
requires  increasing the number of associates in banking  centers,  relationship
bankers,  business  development  officers,  stockbrokers,  and loan officers.  A
Senior Vice  President  and Retail  Banking  Officer was also hired to implement
management's strategic plan. The transition has been responsible for much of the
renewed growth in lending and certificates of deposit.  Increased  staffing also
resulted  from the  re-opening of a Bardstown,  Kentucky  office due to customer
requests  and the  opening of a new  Customer  Service  Center to better  assist
customers with questions or problems and as an additional service, employees are
able to cross sell products to customers while they are on the line.

Occupancy  and  equipment  expense  increased for both the three and nine months
ended March 31, 2001. The increase is largely  attributable to costs  associated
with the Bank's new Customer  Service Center,  which became  operational in July
2000 and the second  Bardstown,  Kentucky banking center,  which opened in early
2000. Data processing expense increased for both the three and nine months ended
March 31, 2001 due to an increase in processor  charges  relating to an increase
in the number of users,  training  expenses,  and the implementation of internet
banking.

Allowance and Provision for Loan Losses

The  allowance  for  loan  losses  is  regularly  evaluated  by  management  and
maintained  at a level  believed  to be  adequate  to absorb  loan losses in the
Bank's  lending  portfolios.  Periodic  provisions  to the allowance are made as
needed. An appropriate level of the general allowance is determined based on the
application  of projected risk  percentages  to graded loans by  categories.  In
addition,  specific  reserves are established  for individual  loans when deemed
necessary by management.  The amount of the provision for loan losses  necessary
to maintain an adequate  allowance is based upon an  assessment of loan quality,
changes  in the size and  character  of the loan  portfolio,  consultation  with
regulatory  authorities,   delinquency  trends,  economic  conditions,  industry
trends, historical charge-offs, recoveries, and other information. Management is
monitoring the commercial real estate loan portfolio  closely,  recognizing that
commercial real estate loans carry a greater risk of loss than  residential real
estate loans,  and believes it has,  based on information  presently  available,
adequately  provided  for loan  losses at March 31,  2001.  Although  management
believes it uses the best  information  available to make allowance  provisions,
future  adjustments,  which could be material,  may be necessary if management's
assumptions differ significantly from the loan portfolio's actual performance.

The  provision for loan losses was $285,000 for the three months ended March 31,
2001  compared to $90,000 for the 2000  quarter.  The  provision for loan losses
also increased for the nine months ended March 31, 2001 to $786,000  compared to
$270,000 for the 2000 period.  The increase in the  provision is a result of the
increase  in  charge-offs  for the  period  and to  compensate  for  the  Bank's
continued strong loan growth. Net loan charge-offs increased $83,000 to $110,000
for the three  months  ended  March 31,  2001  compared  to $27,000 for the same
period in 2000.  Net loan  charge-offs  also increased for the nine months ended
March 31, 2001 to $322,000  compared to $74,000 for the same period in 2000. The
increase in charge-offs is primarily related to charge-offs of indirect consumer
loans during the 2001 period.

                                       17

<PAGE>
The  following  table sets forth an analysis of the Bank's loan loss  experience
for the three and nine months ended March 31, 2001 and 2000.
<TABLE>
<CAPTION>

                                             Three Months Ended          Nine Months Ended
                                                  March 31,                  March 31,
                                              2001         2000          2001          2000
                                              ----         ----          ----          ----
                                                         (Dollars in thousands)
<S>                                         <C>          <C>           <C>           <C>
      Balance-beginning of period            $2,541       $2,241        $2,252        $2,108
                                             ------       ------        ------        ------
      Loans charged-off:
         Real estate mortgage                   -              -            (2)          (36)
         Consumer                              (122)         (29)         (359)          (45)
         Commercial                              -            -              -             -
      Total charge-offs                        (122)         (29)         (361)          (81)
                                             ------       ------         -----         -----
      Recoveries:
         Real estate mortgage                     2            1             2             1
         Consumer                                10            1            37             6
         Commercial                              -             -             -             -
      Total recoveries                           12            2            39             7
                                             ------       ------        ------        ------
      Net loans charged-off                    (110)         (27)         (322)          (74)
                                             ------       ------        ------        ------

      Provision for loan losses                 285           90           786           270
                                             ------       ------        ------        ------

      Balance-end of period                  $2,716       $2,304        $2,716        $2,304
                                             ------       ------        ------        ------

       Net charge-offs to average
        loans outstanding                                                 .064%         .017%
       Allowance for loan losses to
        total non-performing loans                                         368%          214%
       Allowance for loan losses to
        to net loans outstanding                                           .53%          .51%

</TABLE>

Non-Performing Assets

The Bank's non-performing assets consist of loans on which interest is no longer
accrued,  real estate acquired through  foreclosure and repossessed  assets. The
Bank does not have any loans greater than 90 days past due still on accrual. All
loans considered  impaired under SFAS 114 are included in non-performing  loans.
Loans are  considered  impaired if full  principal or interest  payments are not
anticipated in accordance  with the contractual  loan terms.  Impaired loans are
carried at the present  value of expected  future cash flows  discounted  at the
loan's  effective  interest  rate or at the fair value of the  collateral if the
loan is  collateral  dependent.  A portion of the  allowance  for loan losses is
allocated  to impaired  loans if the value of such loans is less than the unpaid
balance.  If these  allocations  cause the  allowance for loan losses to require
increase, the increase is reported in the provision for loan losses.

Loans are  reviewed  on a regular  basis and normal  collection  procedures  are
implemented  when a borrower fails to make a required  payment on a loan. If the
delinquency  on a mortgage loan exceeds 90 days and is not cured through  normal
collection  procedures or an acceptable  arrangement  is not worked out with the
borrower,  the  Bank  institutes  measures  to  remedy  the  default,  including
commencing a foreclosure action. Consumer loans generally are charged off when a
loan is deemed uncollectible by management and any available collateral has been
disposed of. Commercial  business and real estate loan delinquencies are handled
on an  individual  basis by  management  with the  advice  of the  Bank's  legal
counsel.


                                       18

<PAGE>


The  following   table   presents   information   with  respect  to  the  Bank's
non-performing assets for the periods indicated.

                                         March 31,      June 30,
                                           2001           2000
                                           ----           ----
                                           (Dollars in thousands)

   Loans on non-accrual status (1)(2)       $739         $1,562

   Real estate acquired
      through foreclosure                    107             -

   Repossessed assets                         77             -
                                            ----         ------
           Total non-performing
           assets                           $923         $1,562
                                            ====         ======
   Ratios:  Non-performing loans
              to total loans                 .18%           .33%
            Non-performing assets
              to total assets                .15%           .28%
---------------------------------------------------------
(1) Loans on non-accrual status include impaired loans.
(2) The interest income that would have been earned and
    received   on non-accrual loans was approximately $61,000
    for the nine month period ending March 31, and
    $126,000 for the year ending June 30.


Liquidity

The Bank is required to maintain  minimum  specific  levels of liquid  assets as
defined by the Office of Thrift Supervision's  regulations.  This requirement is
based  on a  percentage  of  cash  and  eligible  investments  to  deposits  and
short-term  borrowings and is currently 4%. At March 31, 2001, the Bank's liquid
assets were 5.39% of its liquidity  base. The Bank's primary source of funds for
meeting its liquidity needs are customer  deposits,  borrowings from the Federal
Home Loan Bank,  principal and interest payments from loans and  mortgage-backed
securities, and earnings from operations retained by the Bank.

The Bank intends to continue to fund loan growth  (outstanding  loan commitments
were $2.8  million at March 31,  2001) with  customer  deposits  and  additional
advances from the FHLB. At March 31, 2001, the Bank had an unused  approved line
of credit in the amount of $35 million and  sufficient  collateral  to borrow an
additional $222 million in advances from the FHLB.

Capital

Savings  institutions  insured by the FDIC must meet various  regulatory capital
requirements.  The Bank continues to exceed the regulatory requirements for Tier
I, Tier I leverage and total risk-based capital.  The Bank expects to maintain a
capital  position that meets or exceeds the "well  capitalized"  requirements as
defined by the FDIC.


                                       19


<PAGE>

The Bank's actual and required  capital amounts and ratios at March 31, 2001 are
presented below:
<TABLE>
<CAPTION>

                                                                                       To Be Considered
                                                                                       Well Capitalized
                                                                                         Under Prompt
                                                                    For Capital           Correction
                                               Actual           Adequacy Purposes      Action Provisions
                                          ---------------------------------------------------------------
  As of March 31, 2001:                   Amount    Ratio       Amount     Ratio       Amount      Ratio
                                          ------    -----       ------     -----       ------      -----
   <S>                                  <C>        <C>         <C>         <C>       <C>          <C>
    Total risk-based capital (to risk-
      weighted assets)                   $45,471    10.62%      $34,244     8.0%      $42,805      10.0%
    Tier I capital (to risk-weighted
      assets)                             42,755     9.99        17,122     4.0        25,683       6.0
    Tier I leverage capital (to
      Average assets)                     42,755     7.07        24,180     4.0        30,225       5.0

</TABLE>

Stock  Repurchase  Plan-In  October  1999 the  Corporation's  Board of Directors
authorized the establishment of an additional stock repurchase  program pursuant
to which 10% of the Corporation's outstanding stock may be repurchased from time
to time in the open market. The programs,  which began in 1995, have repurchased
a total of 613,681  shares.  The Board will  continue to evaluate  earnings  per
share and monitor the success of the  repurchase  plan to maintain an attractive
return to stockholders.  The current plan expires in May 2001, at which time the
Board will reanalyze the Bank's capital  position and future earnings  potential
and if appropriate, initiate a new repurchase plan.

Quantitative and Qualitative Disclosures About Market Risk

To minimize the volatility of net interest  income and exposure to economic loss
that may result from  fluctuating  interest rates, the Bank manages its exposure
to adverse  changes in interest  rates through  asset and  liability  management
activities  within  guidelines  established  by its  Asset  Liability  Committee
("ALCO").  The ALCO, which includes senior management  representatives,  has the
responsibility  for  approving  and  ensuring  compliance  with  asset/liability
management  policies of the Corporation,  which include managing the sensitivity
repricing  characteristics  of the  balance  sheet  components  consistent  with
maintaining  acceptable levels of changes in net portfolio value ("NPV") and net
interest  income.  A primary purpose of the ALCO is to manage interest rate risk
to  effectively  invest the  Corporation's  capital  and to  preserve  the value
created by its core business operations.  As such, certain management monitoring
processes are designed to minimize the impact of sudden and sustained changes in
interest rates on NPV and net interest income.

The  Corporation's  exposure  to  interest  rate risk is  reviewed on at least a
quarterly  basis by the  Board of  Directors  and the ALCO.  Interest  rate risk
exposure is measured using interest rate  sensitivity  analysis to determine the
Corporation's  change in NPV in the event of  hypothetical  changes in  interest
rates and  interest  rate  sensitivity  gap  analysis is used to  determine  the
repricing  characteristics  of the Bank's assets and  liabilities.  Refer to the
Bank's 2000 10-K for analysis of the  Corporation's  projected change in NPV for
the various  rate shock levels as of June 30,  2000.  All market risk  sensitive
instruments   presented  are  held  to  maturity  or  available  for  sale.  The
Corporation has no trading securities.

NPV is calculated by the Corporation  pursuant to guidelines  established by the
OTS. The  calculation is based on the net present value of estimated  discounted
cash flows utilizing market prepayment  assumptions and market rates of interest
provided  by  independent  broker  quotations  and  other  public  sources  with
adjustments   made  to  reflect  the  shift  in  the  Treasury  yield  curve  as
appropriate.  Computation of prospective  effects of hypothetical  interest rate
changes are based on numerous  assumptions,  including relative levels of market
interest rates, loan  prepayments,  and deposits decay, and should not be relied
upon  as  indicative  of  actual  results.  Further,  the  computations  do  not
contemplate  any  actions  the ALCO could  undertake  in  response to changes in
interest rates.

                                       20
<PAGE>


Certain  shortcomings  are  inherent in the method of analysis  presented in the
computation of NPV. Actual values may differ from those  projections  presented,
should market  conditions vary from  assumptions  used in the calculation of the
NPV. Certain assets,  such as adjustable rate loans,  which represent one of the
Corporation's  primary loan  products,  have features  that restrict  changes in
interest  rates on a  short-term  basis  and over  the  life of the  assets.  In
addition, the proportion of adjustable rate loans in the Corporation's portfolio
could decrease in future periods if market  interest rates remain at or decrease
below  current  levels due to  refinance  activity.  Further,  in the event of a
change in interest rates,  prepayment and early  withdrawal  levels would likely
deviate  significantly  from those assumed in the NPV.  Finally,  the ability of
many borrowers to repay their adjustable-rate mortgage loans may decrease in the
event of interest rate increases.

Another tool for evaluating the institution's sensitivity to net interest income
to changes in  interest  rates is to examine  the extent to which its assets and
liabilities  are "interest rate  sensitive"  and by monitoring an  institution's
interest rate  sensitivity  "gap".  An asset or liability is said to be interest
rate sensitive within a specific time period if it will mature or reprice within
that time period. The interest rate sensitivity gap is defined as the difference
between the amount of  interest-earning  assets  maturing or repricing  within a
specific time period and the amount of interest-bearing  liabilities maturing or
repricing within that same time period.

The   following   interest  rate   sensitivity   tables  set  forth  the  Bank's
interest-earning  assets and interest-bearing  liabilities at March 31, 2001 and
June 30, 2000,  which are anticipated to reprice or mature in each of the future
time periods shown.


                    Interest Rate Sensitivity (Gap Analysis)
                              As of March 31, 2001
                            (Dollars in thousands)
<TABLE>
<CAPTION>

                                      0-3           4-12         1-5         Over 5
                                     Months        Months       Years        Years       Total
                                     ------        ------       -----        -----       -----
<S>                               <C>           <C>          <C>          <C>         <C>
 Interest earning assets:
   Loans                           $ 74,981      $125,449     $206,602     $111,583    $518,615
   Securities                        24,820        22,130          524        1,335      48,809
                                     ------      --------     --------      -------     -------
      Total rate sensitive assets    99,801       147,579      207,126      112,918     567,424
                                     ------      --------      -------      -------     -------
Interest bearing liabilities:
   NOW, money market and
      Savings                        20,329        60,983       40,232       17,207     138,751
   Time deposits                     87,675       191,368       45,178        2,474     326,695
   Borrowed funds                    35,601        10,173       22,460       10,729      78,963
                                    -------       -------      -------      -------     -------
      Total rate sensitive
       liabilities                  143,605       262,524      107,870       30,410     544,409
                                    -------       -------     --------      -------     -------
Interest sensitivity gap          $ (43,804)    $(114,945)    $ 99,256     $ 82,508    $ 23,015
                                  =========     =========     ========     ========    ========
Cumulative interest sensitivity
   gap                            $ (43,804)    $(158,749)    $(59,493)    $ 23,015
                                  =========     =========     ========     ========
Cumulative interest sensitivity gap
   as a percentage of total assets   (7.28)%       (26.38)%      (9.88)%      3.82%
                                     =======       ========     ========      =====

</TABLE>


                                       21
<PAGE>

                    Interest Rate Sensitivity (Gap Analysis)
                               As of June 30, 2000
                             (Dollars in thousands)
<TABLE>
<CAPTION>

                                      0-3           4-12         1-5         Over 5
                                     Months        Months       Years        Years       Total
                                     ------        ------       -----        -----       -----
<S>                               <C>           <C>          <C>          <C>         <C>
 Interest earning assets:
   Loans                           $ 66,914      $121,661     $185,552     $101,981    $476,108
   Securities                        24,896         7,118       13,562        6,549      52,125
                                     ------      --------     --------      -------     -------
      Total rate sensitive assets    91,810       128,779      199,114      108,530     528,233
                                     ------      --------      -------      -------     -------
Interest bearing liabilities:
   NOW, money market and
      Savings                        19,856        59,568       38,499       16,824     134,747
   Time deposits                     45,128       158,102       86,614        1,270     291,114
   Borrowed funds                    79,018            54          328          941      80,341
                                    -------       -------      -------      -------     -------
      Total rate sensitive
       liabilities                  144,002       217,724      125,441       19,035     506,202
                                    -------       -------     --------      -------     -------
Interest sensitivity gap          $ (52,192)    $ (88,945)    $ 73,673     $ 89,495    $ 22,031
                                  =========     =========     ========     ========    ========
Cumulative interest sensitivity
   gap                            $ (52,192)    $(141,137)    $(67,464)    $ 22,031
                                  =========     =========     ========     ========
Cumulative interest sensitivity gap
   as a percentage of total assets   (9.31)%       (25.17)%     (12.03)%      3.93%
                                     =======       ========     ========      =====

</TABLE>


As the preceding  table  indicates,  the Bank has a negative  cumulative gap for
assets and  liabilities  maturing or repricing  within one year in the amount of
(158,749)  million  or 26.38% of total  assets at March  31,  2001  compared  to
($141,137)  million or 25.17% of total assets at June 30, 2000. Thus,  decreases
in interest rates during this time period would generally  increase net interest
income,  while increases in interest rates would generally decrease net interest
income.  However, even though the periodic gap analysis provides management with
a method  of  measuring  current  interest  rate  risk,  it only  measures  rate
sensitivity  at a  specific  point  in time.  Gap  analysis  does not take  into
consideration that assets and liabilities with similar repricing characteristics
may not reprice at the same time or to the same degree and, therefore,  does not
necessarily predict the impact of changes in general levels of interest rates on
net  interest  income.  Additionally,  certain  assets such as  adjustable  rate
mortgage  loans have  features,  which  restrict  changes in interest rates on a
short-term  basis and over the life of the asset.  Further,  if  interest  rates
change,  prepayment and decay rates may deviate significantly from those assumed
in calculating the table.  Finally,  the ability of many borrowers to afford the
payments on their  adjustable rate mortgage loans may decrease if interest rates
increase.




                                       22
<PAGE>

                 FIRST FEDERAL FINANCIAL CORPORATION OF KENTUCKY


Part II - Other Information

      Item 1.    Legal Proceedings
                    Not Applicable

      Item 2.    Changes in Securities
                    Not Applicable

      Item 3.    Defaults Upon Senior Securities
                    Not Applicable

      Item 4.    Submission of Matters to a Vote of
                    Security Holders
                    Not Applicable

      Item 5.    Other Information
                    Not Applicable

      Item 6.    Exhibits:  Not Applicable
                    Reports on Form 8-K:  Not Applicable


                                       23

<PAGE>


                 FIRST FEDERAL FINANCIAL CORPORATION OF KENTUCKY

Pursuant to the  requirements of Section 13 or 15(d) 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.



DATE:  May 11, 2001                BY: (S) B. Keith Johnson
                                         ------------------------------
                                          B. Keith Johnson
                                          President and Chief Executive Officer


DATE:  May 11, 2001                BY: (S) Charles E. Chaney
                                         -----------------------------
                                          Charles E. Chaney
                                          Senior Vice President
                                          Chief Operating Officer










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