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, 2002

                                       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, 2002
           -----------                 ----------------------------------

           Common Stock                          3,742,600 shares


                    This document is comprised of 23 pages.


<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    12-21

 Item 3 -Quantitative and Qualitative Disclosures about Market Risk     20-21

 PART II - OTHER INFORMATION                                               22

 SIGNATURES                                                                23



<PAGE>


                 FIRST FEDERAL FINANCIAL CORPORATION OF KENTUCKY
                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

                                                     (UNAUDITED)
                                                      MARCH 31,       JUNE 30,
                                ASSETS                   2002           2001
                                                         ----           ----
                                                       (DOLLARS IN THOUSANDS)

Cash and due from banks                               $ 11,458       $ 14,927
Interest bearing deposits                               78,466         20,537
                                                        ------         ------
           Total cash and cash equivalents              89,924         35,464
Securities available-for-sale                            1,945          2,013
Securities held-to-maturity:  fair value of $4,810
   (March) and $20,954 at (June) 2001                    4,777         20,921
Loans receivable, less allowance for loan losses
   of $3,497 (March) and $2,906 (June) 2001            513,705        517,145
Federal Home Loan Bank stock                             6,098          5,845
Premises and equipment                                  11,314         11,454
Real estate owned:
  Acquired through foreclosure                             578            296
  Held for development                                     721            721
Repossessed assets                                         125             70
Excess of cost over net assets acquired                  8,591          9,215
Accrued interest receivable                              1,476          2,025
Other assets                                             1,203          1,557
                                                      --------       --------
          TOTAL ASSETS                                $640,457       $606,726
                                                      ========       ========

                      LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES:
Deposits:
   Non-interest bearing                               $ 23,042       $ 21,208
   Interest bearing                                    468,446        447,617
                                                       -------        -------
             Total Deposits                            491,488        468,825
Advances from Federal Home Loan Bank                    77,846         77,298
Trust Preferred Securities                               9,699           -
Accrued interest payable                                   520          1,970
Accounts payable and other liabilities                   1,299          2,476
Deferred income taxes                                    1,482          1,565
                                                       -------        -------
          TOTAL LIABILITIES                            582,334        552,134
                                                       -------        -------

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, 3,758,000 shares in June and
      March                                             3,758          3,758
 Additional paid-in capital                                18             21
 Retained earnings                                      3,984         50,405
 Accumulated other comprehensive
    income, net of tax                                    363            408
                                                     --------       --------
        TOTAL STOCKHOLDERS' EQUITY                     58,123         54,592
                                                     --------       --------
        TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY   $640,457       $606,726
                                                     ========       ========

                 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,
                                                       2002            2001          2002            2001
                                                       ----            ----          ----            ----
<S>                                                 <C>             <C>            <C>             <C>
 INTEREST INCOME:
   Interest and fees on loans                        $10,332         $10,759        $31,888         $31,171
   Interest and dividends on investments
     and deposits                                        403             903          1,379           2,610
                                                      ------          ------          -----          ------
          Total interest income                       10,735          11,662         33,267          33,781
                                                      ------          ------         ------          ------
INTEREST EXPENSE:
   Deposits                                            3,960           5,666         13,610          16,339
   Federal Home Loan Bank advances                       923           1,267          2,806           4,374
                                                       -----           -----         ------          ------
          Total interest expense                       4,883           6,933         16,416          20,713
                                                       -----           -----         ------          ------
Net interest income                                    5,852           4,729         16,851          13,068
Provision for loan losses                                415             285          1,175             786
                                                       -----           -----         ------          ------
Net interest income after provision for loan losses    5,437           4,444         15,676          12,282
                                                       -----           -----         ------          ------
NON-INTEREST INCOME:
   Customer service fees on deposit accounts             849             663          2,277           1,862
   Secondary mortgage market closing fees                157             117            511             343
   Gain on sale of investments                            -               -              -              696
   Brokerage and insurance commissions                   141             175            417             498
   Other income                                          181             157            765             490
                                                       -----           -----          -----           -----
         Total non-interest income                     1,328           1,112          3,970           3,889
                                                       -----           -----          -----           -----
NON-INTEREST EXPENSE:
   Employee compensation and benefits                  1,874           1,658          5,337           4,726
   Office occupancy expense and equipment                368             366          1,113           1,089
   FDIC insurance premium                                 21              21             64              64
   Marketing and advertising                             162             125            425             376
   Outside services and data processing                  390             372          1,142           1,035
   State franchise tax                                   129             109            343             315
   Amortization of intangibles                           208             208            624             624
   Other expense                                         761             588          2,146           1,822
                                                       -----           -----          -----           -----
         Total non-interest expense                    3,913           3,447         11,194          10,051
                                                       -----           -----         ------          ------
Income before income taxes                             2,852           2,109          8,452           6,120
Income taxes                                             927             705          2,796           2,022
                                                      ------          ------          -----           -----
NET INCOME                                            $1,925          $1,404         $5,656          $4,098
                                                      ======          ======         ======          ======
Earnings per share:
         Basic                                        $ 0.51          $ 0.37         $ 1.51          $ 1.09
         Diluted                                      $ 0.51          $ 0.37         $ 1.51          $ 1.09
</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,
                                                         --------                    ---------
                                                    2002         2001            2002         2001
                                                    ----         ----            ----         ----
<S>                                               <C>          <C>             <C>          <C>
NET INCOME                                         $1,925       $1,404          $5,656       $4,098
Other comprehensive income (loss), net of tax:
     Change in unrealized gain (loss)
        on securities                                 (13)         (21)            (45)         353
     Reclassification of realized amount                -            -               -         (459)
                                                   ------       ------          ------       ------
     Net unrealized gain (loss) recognized in
        Comprehensive income                          (13)         (21)            (45)        (106)
                                                   ------       ------          ------       ------
COMPREHENSIVE INCOME                               $1,912       $1,383          $5,611       $3,992
                                                   ======       ======          ======       ======

</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, 2002
                                   (UNAUDITED)
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>

                                                                                            ACCUMULATED OTHER
                                                               ADDITIONAL                     COMPREHENSIVE
                                       COMMON STOCK             PAID - IN       RETAINED         INCOME,
                                  SHARES          AMOUNT         CAPITAL        EARNINGS       NET OF TAX        TOTAL
                                  ------          ------         -------        --------       ----------        -----
<S>                               <C>           <C>             <C>             <C>             <C>            <C>
BALANCE, JUNE 30, 2001             3,758         $ 3,758         $   21          $50,405         $   408        $54,592
Net income                           -                -              -             5,656              -           5,656
Exercise of stock options             10              10            126              -                -             136
Stock tendered as
  payment for options
  exercised                           (7)             (7)          (129)                                           (136)
Net change in unrealized
  gains (losses) on
  securities available-
  for-sale, net of tax               -               -                -              -               (45)           (45)
Cash dividends declared
   ($.54 per share)                  -               -                -           (2,030)             -          (2,030)
Stock repurchased                    (3)              (3)             -              (47)             -             (50)
                                  -----          -------         ------          -------          ------        ---
BALANCE, MARCH 31, 2002           3,758          $ 3,758         $   18          $53,984          $  363        $58,123
                                  =====          =======         ======          =======          ======        =======

</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,
                                                           2002           2001
                                                           ----           ----
OPERATING ACTIVITIES:
 Net income                                              $ 5,656       $ 4,098
 Adjustments to reconcile net income to net
    cash provided by operating activities:
    Provision for loan losses                              1,175           786
    Depreciation of premises and equipment                   801           841
    Federal Home Loan Bank stock dividends                  (253)         (281)
    Amortization of acquired intangible assets               624           624
    Amortization and accretion on securities                 (47)          (45)
    Gain on sale of investments available-for-sale            -           (696)
    Gain on sale of real estate held for development         (10)           (9)
    Deferred taxes                                           (60)          170
    Changes in:
      Interest receivable                                    549           250
      Other assets                                           354           (14)
      Interest payable                                    (1,450)          761
      Accounts payable and other liabilities              (1,167)         (595)
                                                          ------         -----
Net cash provided by operating activities                  6,172         5,890
                                                          ------         -----
INVESTING ACTIVITIES:
  Sales of securities available-for-sale                     -             708
  Purchases of securities available-for-sale                 -             (32)
  Purchases of securities held-to-maturity                (7,000)           -
  Maturities of securities held-to-maturity               23,191        13,244
  Net (increase) decrease in loans                         1,928       (43,203)
  Purchase of Federal Home Loan Bank stock                   -          (1,379)
  Net purchases of premises and equipment                   (661)         (703)
  Purchase of real estate held for development               -            (275)
                                                          ------       -------
Net cash used in investing activities                     17,458       (31,640)
                                                          ------       -------
FINANCING ACTIVITIES:
  Net increase in deposits                                22,663        40,255
  Advances from Federal Home Loan Bank                       725        32,590
  Repayments to Federal Home Loan Bank                      (177)      (33,966)
  Proceeds from issuance of trust preferred securities     9,699            -
  Dividends paid                                          (2,030)       (2,028)
  Proceeds from stock options exercised                      -               8
  Common stock repurchased                                   (50)          (30)
                                                          ------        ------
Net cash provided by financing activities                 30,830        36,829
                                                          ------        ------
INCREASE IN CASH AND CASH EQUIVALENTS                     54,460        11,079
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD            35,464        14,979
                                                          ------        ------
CASH AND CASH EQUIVALENTS, END OF PERIOD                 $89,924       $26,058
                                                         =======       =======


                 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
         Company.  All significant  intercompany  transactions and balances have
         been eliminated.

         The accompanying  unaudited consolidated financial statements have been
         prepared in accordance with accounting principles generally accepted in
         the United States of America 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  accounting  principles  generally  accepted in the United
         States of America 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 nine-month  period ending March 31, 2002 are
         not necessarily  indicative of the results that may be expected for the
         year  ended  June  30,  2002.  For  further  information,  refer to the
         consolidated financial statements and footnotes thereto included in the
         Corporation's  annual  report on Form 10-K for the year  ended June 30,
         2001.

         NEW  ACCOUNTING  PRONOUNCEMENTS  - The Financial  Accounting  Standards
         Board  issued  SFAS No. 141  "Business  Combinations"  and SFAS No. 142
         "Goodwill  and  Other  Intangibles"  in  June  2001.  As a  result  and
         effective immediately, the purchase method is the only allowable method
         for accounting for prospective business combinations. Effective July 1,
         2002 for the  Corporation,  acquisition  intangibles  must be separated
         into goodwill and identifiable  intangibles.  Identifiable  intangibles
         will  continue to be  amortized  while  amortization  of goodwill  will
         cease.  Annual  impairment  testing will be required for goodwill  with
         impairment  charges to be recorded if the carrying  amount is in excess
         of its fair  value.  The  financial  statement  impact has not yet been
         determined.

         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, 2002:
               Equity securities                     $   385      $ 547        $  -     $   932
               Obligation of states and political
                  subdivisions                         1,010          8          (5)      1,013
                                                     -------      ----         ----     -------
                    Total available-for-sale         $ 1,395      $ 555        $ (5)    $ 1,945
                                                     =======      =====        ====     =======

         Securities held-to-maturity:
           MARCH 31, 2002:
              U.S. Treasury and agencies             $ 3,953      $  64        $ (5)    $ 4,012
              Mortgage-backed securities                 824          5         (31)        798
                                                     -------      -----        ----     -------
                   Total held-to-maturity            $ 4,777      $  69        $(36)    $ 4,810
                                                     =======      =====        ====     =======
</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, 2001:
               Equity securities                    $   385       $ 617        $ (5)    $   997
               Obligation of states and political
                  Subdivisions                        1,010           6           -       1,016
                                                    -------       -----        ----     -------
                    Total available-for-sale        $ 1,395       $ 623        $ (5)    $ 2,013
                                                    =======       =====        ====     =======

         Securities held-to-maturity:
           JUNE 30, 2001:
              U.S. Treasury and agencies            $19,917       $ 150       $(104)    $19,963
              Mortgage-backed securities              1,004           4         (17)        991
                                                    -------       -----       ------    -------
                   Total held-to-maturity           $20,921       $ 154       $(121)    $20,954
                                                    =======       =====       =====     =======
</TABLE>


                                       9

<PAGE>

3.       LOANS RECEIVABLE

         Loans receivable are summarized as follows:

                                                     MARCH 31,      JUNE 30,
                                                        2002          2001
                                                        ----          ----
                                                      (DOLLARS IN THOUSANDS)

                Commercial                           $ 19,184      $ 17,844
                Real estate commercial                103,374        88,938
                Real estate construction                9,805         9,079
                Real estate mortgage                  316,746       330,488
                Consumer and home equity               50,445        54,189
                Indirect consumer                      19,645        21,822
                                                      -------       -------
                      Total loans                     519,199       522,360
                                                      -------       -------
                Less:
                  Net deferred loan origination fees   (1,997)       (2,309)
                  Allowance for loan losses            (3,497)       (2,906)
                                                     --------      --------
                                                       (5,494)       (5,215)
                                                     --------      --------
                Loans, net                           $513,705      $517,145
                                                     ========      ========



          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,
                                                2002          2001          2002        2001
                                                ----          ----          ----        ----
                                                             (DOLLARS IN THOUSANDS)
           <S>                               <C>           <C>          <C>          <C>
            Allowance for loan losses:
              Balance, beginning of period    $ 3,284       $ 2,541      $ 2,906      $ 2,252
              Provision for loan losses           415           285        1,175          786
              Charge-offs                                      (122)        (690)
                                                 (264)                                   (361)
              Recoveries                           62            12          106           39
                                              -------       -------      -------      -------
              Balance, end of period          $ 3,497       $ 2,716      $ 3,497      $ 2,716
                                              =======       =======      =======      =======

</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,
                                               2002                2001
                                               ----                ----
                                                 (DOLLARS IN THOUSANDS)

        End of period impaired loans         $3,701              $2,720
        Amount of allowance for loan
         loss allocated                         504                 268



                                       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 secured by the Bank's stock in the FHLB and  substantially
         all of the Bank's first mortgage loans. At March 31, 2002, the Bank had
         $77.8 million in advances outstanding from the FHLB and the capacity to
         increase its borrowings an additional $21.9 million.

5.       TRUST PREFERRED SECURITIES

         On March 26, 2002, First Federal  Statutory Trust I, a trust subsidiary
         of First Federal Financial Corporation of Kentucky (the "Corporation"),
         completed the private  placement of 10,000  shares of cumulative  trust
         preferred  securities  with a  liquidation  preference  of  $1,000  per
         security.  The proceeds of the offering were loaned to the  Corporation
         in exchange for floating rate junior  subordinated  deferrable interest
         debentures.  Distributions on the securities are payable quarterly at a
         rate per annum equal to the 3-month LIBOR plus 3.60%.  The  Corporation
         undertook the issuance of these  securities  to enhance its  regulatory
         capital  position.  The Corporation  intends to utilize the capital for
         general   business   purposes   and  to  support   the  Bank's   future
         opportunities  for growth.  These  securities  are considered as Tier I
         capital for the Corporation under current regulatory guidelines.

6.       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,
                                                       ---------                   ---------
                                                   2002        2001            2002         2001
                                                   ----        ----            ----         ----
                                                                  (IN THOUSANDS)
        <S>                                      <C>          <C>           <C>          <C>
         Net income available
            to common shareholders                $1,925       $1,404        $5,656       $4,098
                                                  ======       ======        ======       ======
         Basic EPS:
            Weighted average common shares         3,759        3,755         3,759        3,755
                                                   =====        =====         =====        =====
         Diluted EPS:
            Weighted average common shares         3,759        3,755         3,759        3,755
            Dilutive effect of stock options          18            6            16            7
                                                   -----        -----         -----        -----
            Weighted average common and
              incremental shares                   3,777        3,761         3,775        3,762
                                                   =====        =====         =====        =====
         Earnings Per Share:
             Basic                                  $0.51       $0.37         $1.50        $1.09
                                                    =====       =====         =====        =====

             Diluted                                $0.51       $0.37         $1.50        $1.09
                                                    =====       =====         =====        =====
</TABLE>



                                       11



<PAGE>



            MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                            AND RESULTS OF OPERATIONS

GENERAL

First Federal Financial  Corporation of Kentucky  ("Corporation") is the holding
company  for  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 the Bank is the  Office  of Thrift
Supervision (OTS).

The following  discussion  and analysis  covers any  significant  changes in the
financial  condition since June 30, 2001 and any material changes in the results
of operations for the three-month and nine-month  periods ending March 31, 2002.
This  discussion and analysis should be read in conjunction  with  "Management's
Discussion  and  Analysis of  Financial  Condition  and  Results of  Operations"
included in the 2001 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,  the Corporation may
make  forward-looking  statements  in future  filings  with the  Securities  and
Exchange  Commission,  in press  releases,  and in oral and written  statements.
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 Corporation
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, and readers are cautioned not to place undue reliance on
the forward-looking  statements in this report. The  forward-looking  statements
speak as of the date of this report, and the Corporation makes no undertaking to
update the  forward-looking  statements  in this report to reflect  developments
after the date of this report.

OVERVIEW

Net income for the quarter  ended  March 31, 2002 was $1.9  million or $0.51 per
share  diluted  compared to $1.4 million or $0.37 per share diluted for the same
period in 2001.  The rise in the  Bank's  net  interest  margin  is the  largest
contributing   factor  to  the  37%  growth  in  earnings  for  the  three-month
comparative periods.


                                       12

<PAGE>

Net income for the nine months  ended  March 31, 2002 was $5.7  million or $1.51
per share  diluted  compared to $4.1 million or $1.09 per share  diluted for the
same period in 2001. In January 2001, the Bank  restructured  $75 million of its
Federal Home Loan Bank advances from  overnight to 10 year  maturities to secure
financing at lower interest rates.  Management expects that the restructuring of
advances  coupled  with  the  Federal  Open  Market  Committee's  interest  rate
reductions  will  continue  to have a positive  impact on future  earnings.  The
Bank's book value per common  share  increased  from $14.28 at March 31, 2001 to
$15.47 at March 31,  2002.  Net income for the 2002 period  generated  return on
average  assets of 1.23% and return of average  equity of 13.34%.  These compare
with return on average assets of .93% and return on average equity of 10.35% for
the 2001 period.

The Bank's  total  assets at March 31, 2002 grew to $640.5  million  compared to
$606.7 million at June 30, 2001. Net loans  decreased $3.4 million from June 30,
2001 to  $513.7  million  at March  31,  2002.  Residential  real  estate  loans
decreased  during the 2002 period as declining  market  interest rates caused an
increase in 1-4 family  refinancing  activity into fixed-rate,  secondary market
loan products. The commercial real estate portfolio remained strong,  increasing
by $14.4 million to $103.4 million at March 31, 2002. This growth is a result of
the Bank's  continued  emphasis  on the active  pursuit  of  commercial  lending
opportunities.  While overall loan volume  remained  strong,  the  percentage of
non-performing  loans  to  total  loans  remained  low at  0.25%,  as  the  Bank
maintained its underwriting standards and continued its emphasis on secured real
estate lending.

Funding for the growth in the commercial real estate  portfolio was derived from
deposits.  Deposits increased by $22.7 million to $491.5 million as of March 31,
2002 compared to $468.8 million at June 30, 2001. The growth in retail  deposits
was primarily in savings and money market  accounts  caused in part by a general
shift during recent quarters in funds from the stock market to more conservative
investments such as bank deposits. FHLB advances increased from $77.3 million at
June 30, 2001 to $77.8 million at March 31, 2002.

RESULTS OF OPERATIONS

NET INTEREST  INCOME- The principal source of the Bank's revenue is net interest
income.  Net  interest  income  is the  difference  between  interest  income on
interest-earning  assets,  such as loans and securities and the interest expense
on liabilities used to fund those assets, such as interest-bearing  deposits and
borrowings.  Net  interest  income is impacted by both changes in the amount and
composition of interest-earning assets and interest-bearing  liabilities as well
as market interest rates.

For the quarter ended March 31, 2002, net interest  income was $5.8 million,  up
$1.1 million from the $4.7 million  attained  during the 2001 quarter.  The Bank
was able to increase its net interest  income through an improved  interest rate
margin  compared to 2001.  The Bank's net interest  margin  increased from 3.32%
during the quarter  ended March 31, 2001 to 3.96% for the 2002  period.  The net
interest  rate spread  increased  from 2.93% during the 2001 quarter to 3.63% in
the  comparable  quarter of 2002. The net interest  spread and margin  benefited
from a  significant  decline in the Bank's cost of funds due to a  reduction  in
short-term market interest rates by the Federal Reserve. During the 2002 period,
average  interest-earning  assets  were  $591.5  million,  an  increase of $21.9
million over the same period in 2001. Total average interest bearing liabilities
increased  from $527.5 million during the quarter ended March 31, 2001 to $538.7
million for the same period in 2002.

Net interest  income for the nine months ended March 31, 2002 was $16.9 million,
an increase of $3.8  million  from the $13.1  million  attained  during the same
period of 2001. The Bank's net interest  spread  increased 76 basis points while
the net  interest  margin  increased  72 basis  points for the nine months ended
March 31, 2002 compared to the same period in 2001. The increase in net interest
income resulted from the Federal Reserve  decreasing  short-term  interest rates
throughout  2001.  All  categories  of  interest  income  and  interest  expense
experienced  a  reduction  due to rate.  Because  the  Bank's  interest  bearing
liabilities  generally  have a shorter  repricing  frequency  than its  interest
earning  assets,  the overall effect to the Bank was an increase in net interest
income due to an improved spread during 2002.

                                       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, 2002 and 2001.
<TABLE>
<CAPTION>

                                                                     THREE MONTHS ENDED MARCH 31,
                                         ------------------------------------------------------------------------------------
                                                           2002                                       2001
                                                           ----                                       ----

                                            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                        $ 945         $  7         2.96%            $ 935          $  8         3.42%
   State and political subdivision
     securities (1)                         1,014           18         7.10               997            17         6.82
   U.S. Treasury and agencies               4,730           72         6.09            38,656           710         7.35
   Mortgage-backed securities                 810           11         5.43             1,037            19         7.33
   Loans receivable (2) (3)               520,816       10,332         7.94           516,392        10,759         8.33
   FHLB stock                               6,048           67         4.43             5,666           101         7.13
   Interest bearing deposits               57,183          234         1.64             5,959            54         3.62
                                          -------       ------         ----           -------        ------         ----
     TOTAL INTEREST EARNING ASSETS        591,546       10,741         7.26           569,642        11,668         8.19
                                                        ------         ----                          ------         ----
Less:  Allowance for loan losses           (3,361)                                     (2,641)
Non-interest earning assets                34,520                                      37,493
                                         --------                                    --------
     TOTAL ASSETS                        $622,705                                    $604,494
                                         ========                                    ========

LIABILITIES AND STOCKHOLDERS' EQUITY
Interest bearing liabilities:
   Savings accounts                       $62,122        $ 369        2.38%           $33,151         $ 225         2.71%
   NOW and money market
     accounts                             100,555          360        1.43             80,509           550         2.73
   Certificates of deposit and
     other time deposits                  297,976        3,223        4.33            314,915         4,891         6.21
   FHLB Advances                           77,535          923        4.76             98,957         1,267         5.12
   Trust Preferred Securities                 555            8        5.77                -             -             -
                                          -------        -----        ----            -------        -----          ----
     TOTAL INTEREST BEARING LIABILITIES   538,743        4,883        3.63            527,532        6,933          5.26
                                                         -----        ----                           -----          ----
Non-interest bearing liabilities:
   Non-interest bearing deposits           21,660                                      17,982
   Other liabilities                        4,563                                       5,558
                                         --------                                     -------
     TOTAL LIABILITIES                    564,966                                     551,072

Stockholders' equity                       57,739                                      53,422
                                         --------                                    --------
     TOTAL LIABILITIES AND
       STOCKHOLDERS' EQUITY              $622,705                                    $604,494
                                         ========                                    ========

NET INTEREST INCOME                                     $5,858                                     $4,735
                                                        ======                                     ======
NET INTEREST SPREAD                                                   3.63%                                        2.93%
                                                                      =====                                        =====
NET INTEREST MARGIN                                                   3.96%                                        3.32%
                                                                      =====                                        =====

</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, 2002 and 2001.
<TABLE>
<CAPTION>

                                                                       NINE MONTHS ENDED MARCH 31,
                                         ------------------------------------------------------------------------------------
                                                           2002                                       2001
                                                           ----                                       ----

                                            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                         $ 958        $  24         3.34%        $ 1,029         $  25        3.24%
   State and political subdivision
     securities (1)                          1,021           53         6.92             970            50        6.87
   U.S. Treasury and agencies                8,065          387         6.40          40,591         2,071        6.80
   Mortgage-backed securities                  884           43         6.48           1,152            64        7.41
   Loans receivable (2) (3)                524,022       31,888         8.11         500,234        31,171        8.31
   FHLB stock                                5,957          253         5.66           5,101           281        7.35
   Interest bearing deposits                40,204          637         2.11           4,976           136        3.64
                                           -------       ------         ----          ------        ------        ----
     TOTAL INTEREST EARNING ASSETS         581,111       33,285         7.64         554,053        33,798        8.13
                                                         ------         ----                        ------        ----
Less:  Allowance for loan losses            (3,155)                                   (2,449)
Non-interest earning assets                 35,669                                    37,318
                                          --------                                  --------
     TOTAL ASSETS                         $613,625                                  $588,922
                                          ========                                  ========

LIABILITIES AND STOCKHOLDERS' EQUITY
Interest bearing liabilities:
   Savings accounts                        $47,701        $ 791         2.21%        $33,791        $  816        3.22%
   NOW and money market
     Accounts                               93,606        1,377         1.96          78,984         1,519        2.56
   Certificates of deposit and
     other time deposits                   310,058       11,434         4.92         304,007        14,004        6.14
   FHLB Advances                            77,684        2,806         4.82          95,727         4,374        6.09
   Trust Preferred Securities                  185            8         5.77            -            -             -
                                           -------       ------         ----         -------        ------        ----
     TOTAL INTEREST BEARING LIABILITIES    529,234       16,416         4.14         512,509        20,713        5.39
                                                         ------         ----         -------        ------        ----
Non-interest bearing liabilities:
   Non-interest bearing deposits            21,999                                    17,806
   Other liabilities                         5,859                                     5,808
                                           -------                                   -------
     TOTAL LIABILITIES                     557,092                                   536,123

Stockholders' equity                        56,533                                    52,799
                                          --------                                ----------
     TOTAL LIABILITIES AND
       STOCKHOLDERS' EQUITY               $613,625                                  $588,922
                                          ========                                  ========

NET INTEREST INCOME                                     $16,869                                    $13,085
                                                        =======                                    =======
NET INTEREST SPREAD                                                     3.50%                                     2.74%
                                                                        =====                                     =====
NET INTEREST MARGIN                                                     3.87%                                     3.15%
                                                                        =====                                     ====
</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,
                                                          2002 VS. 2001                         2002 VS. 2001
                                                       ------------------                    ------------------
                                                       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                                        $(519)    $ 92       $(427)            $(742)   $1,459     $ 717
     Equity securities                               (1)      -           (1)              -          (1)       (1)
     State and political subdivision
       securities                                     1       -            1               -           3         3
     U.S. Treasury and agencies                    (104)    (534)       (638)             (116)   (1,568)   (1,684)
     Mortgage-backed securities                      (4)      (4)         (8)               (7)      (14)      (21)
     FHLB stock                                     (41)       7         (34)              (71)       43       (28)
     Interest bearing deposits                      (45)     225         180               (80)      581       501
                                                   ----     ----        ----            ------     -----     -----
     TOTAL INTEREST EARNING ASSETS                 (713)    (214)       (927)           (1,016)      503      (513)
                                                   ----     ----        ----            ------     -----     -----
   INTEREST EXPENSE:
      Savings accounts                              (31)     175         144              (301)      276       (25)
      NOW and money market accounts                (305)     115        (190)             (394)      252      (142)
      Certificates of deposit and other
         time deposits                           (1,417)    (251)     (1,668)           (2,844)      274    (2,570)
      FHLB advances                                 (84)    (260)       (344)             (825)     (743)   (1,568)
      Trust Preferred Securities                     -         8           8               -           8         8
                                                 ------     ----      ------            ------      ----    ------
     TOTAL INTEREST BEARING LIABILITIES          (1,837)    (213)     (2,050)           (4,364)       67    (4,297)
                                                 ------     ----      ------            ------      ----    ------

     NET CHANGE IN NET INTEREST INCOME          $ 1,124    $  (1)    $ 1,123           $ 3,348     $ 436   $ 3,784
                                                =======    =====     =======           =======     =====   =======
</TABLE>

NON-INTEREST  INCOME-Non-interest  income was $1.3 million for the quarter ended
March 31, 2002, as compared to $1.1 million for the 2001 period,  an increase of
$216,000.  Fee income from  secondary  market  lending  operations  increased by
$40,000  or 34%  during  the  2002  period  compared  to 2001  due to  increased
secondary  market   residential  loan   originations  from  a  higher  level  of
refinancing  activity.   Customer  service  fees  charged  on  deposit  accounts
increased  by  $186,000  or  28%  during  the  2002  quarter  due to  growth  in
fee-related  customer  transactions  and  deposit  relationships  with  existing
customers.  Service charges on deposit accounts were positively  affected by the
Bank's new  "Powerdraft"  program.  The  "Powerdraft"  program permits  selected
clients to overdraft their accounts up to $600 for the Bank's  customary fee. At
March  31,  2002,  the  Bank  had  nearly  14,000  accounts   eligible  for  the
"Powerdraft"  program.  Other  sources  of  income  such as loan  fees and other
customer  transaction  fees also increased during the 2001 period as compared to
the 2000 period.

Non-interest  income was $4.0  million for the nine months ended March 31, 2002,
as compared to $3.9 million for the same period last year. During the March 2002
period  the Bank did not  report any gains from  investment  sales  compared  to
reported  gains of $696,000  for the 2001  period.  Fee income  from  secondary
market  lending  operations  increased by $168,000 or 49% during the 2002 period
compared to 2001. Customer service fees charged on deposit accounts increased by
$415,000  or 22% during the 2002 period due to the Bank's  continued  efforts to
expand its product  line and the  implementation  of the new  overdraft  payment
policy.

                                       16

<PAGE>

NON-INTEREST  EXPENSE-  Non-interest  expense  increased  during the quarter and
nine-month  period ended March 31, 2002 compared to the same period in 2001. The
most significant factors comprising the increase in non-interest expense for the
quarter  and  nine-months  ended  March 31,  2002  were  increases  in  employee
compensation and benefits, data processing expense and other expense.

Compensation  and  employee  benefits,  the largest  component  of  non-interest
expense,  increased  $216,000 for the 2002 quarter compared to the 2001 quarter,
and  $611,000  for the nine months  ended  March 31, 2002  compared to March 31,
2001.  The  increase  reflects  growth in the  overall  staffing  level from 196
full-time  equivalent  employees at M arch 31, 2001 to 217 full-time  equivalent
employees  at March 31,  2002.  The Bank's  continued  emphasis on building  its
commercial  and retail staff to reflect its commercial  bank  philosophy was the
largest contributing factor.

Data processing expense increased for both the three and nine months ended March
31, 2002 due to an increase in processor  charges relating to an increase in the
number of users,  training  expenses,  the  implementation  of cash  management,
internet  banking and the creation of the Bank's new imaging  department.  Other
expense  increased  during the 2002 period  including  postage,  stationary  and
supplies and customer account expenses.

ALLOWANCE AND PROVISION FOR LOAN LOSSES

The  allowance  for  loan  losses  is  regularly  evaluated  by  management  and
maintained at a level that is considered  sufficient to absorb probable incurred
credit  losses  existing  in the  loan  portfolio.  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, 2002. 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 $415,000 for the three months ended March 31,
2002  compared to $285,000 for the 2001  quarter.  The provision for loan losses
also increased for the nine months ended March 31, 2002 to $1.2 million compared
to $786,000 for the 2001 period.  The total allowance for loan losses  increased
$781,000 to $3.5 million for March 31, 2001 as compared to $2.7 million at March
31, 2002.  Management  increased the provision and allowance for loan losses due
to the  increase  in  non-performing  loans  and  charge-offs  for  the  period,
continued  strong  growth in  commercial  real estate  lending and the generally
recognized slowing in the U.S. economy.  Net loan charge-offs  increased $92,000
to $202,000 for the three  months ended March 31, 2002  compared to $110,000 for
the same period in 2001. Net loan charge-offs also increased for the nine months
ended  March 31, 2002 to  $584,000  compared to $322,000  for the same period in
2001.  The  increase in  charge-offs  is  primarily  related to  charge-offs  of
indirect consumer loans and commercial real estate loans during the 2002 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, 2002 and 2001.
<TABLE>
<CAPTION>

                                           THREE MONTHS ENDED             NINE MONTHS ENDED
                                                MARCH 31,                     MARCH 31,
                                                ---------                     ---------

                                            2002        2001              2002         2001
                                            ----        ----              ----         ----
                                                        (DOLLARS IN THOUSANDS)

     <S>                                  <C>         <C>               <C>          <C>
      Balance-beginning of period          $3,284      $2,541            $2,906       $2,252
                                           ------      ------            ------       ------
      Loans charged-off:
         Real estate mortgage                 -            -                 -            (2)
         Consumer                            (156)       (122)             (434)        (359)
         Commercial                          (108)         -               (256)           -
                                             ----        ----              ----
      Total charge-offs                      (264)       (122)             (690)        (361)
                                             ----        ----              ----         ----
      Recoveries:
         Real estate mortgage                   1           2                 6            2
         Consumer                              31          10                63           37
         Commercial                            30          -                 37            -
                                             ----        ----            ------       ------
      Total recoveries                         62          12               106           39
                                             ----        ----            ------       ------
      Net loans charged-off                  (202)       (110)             (584)        (322)
                                             ----        ----            ------       ------
      Provision for loan losses               415         285             1,175          786
                                           ------      ------            ------       ------
      Balance-end of period                $3,497      $2,716            $3,497       $2,716
                                           ------      ------            ------       ------

       Net charge-offs to average
         loans outstanding                                                  .11%        .064%
       Allowance for loan losses to
         total non-performing loans                                          271%         368%
       Allowance for loan losses to
         to net loans outstanding                                           .68%         .53%

</TABLE>

Federal regulations require insured institutions to classify their own assets on
a regular basis.  The  regulations  provide for three  classifications  of asset
categories --  substandard,  doubtful and loss. The  regulations  also contain a
special  mention  category,  defined as assets which do not currently  expose an
insured institution to a sufficient degree of risk to warrant classification but
do possess credit deficiencies or potential  weaknesses  deserving  management's
close  attention.  Assets  classified  as  substandard  or doubtful  require the
institution  to establish  general  allowances  for loan losses.  If an asset or
portion  thereof is  classified  as loss,  the insured  institution  must either
establish  specified  allowances  for loan  losses in the  amount of 100% of the
portion of the asset  classified  loss, or charge off such amount.  At March 31,
2002, on the basis of management's review of the Bank's loan portfolio, the Bank
had $3.7 million of assets classified substandard, $176,000 of assets classified
as doubtful and $92,000 of assets classified as loss.

The  amount  of the loan  loss  allowance  is based  on the  percentage  of each
classified  loan  considered  to be at  risk,  based  on the  following  ranges:
Substandard-2.5% to 35%;  Doubtful-5% to 50%; Loss-100%;  and Special Mention-2%
to 6%. The risk  percentages  are  developed  by the Bank in  consultation  with
regulatory authorities,  actual loss experience,  peer group loss experience and
are  adjusted  for  current  economic  conditions.   The  risk  percentages  are
considered a prudent measurement of the risk of the Bank's loan portfolio.  Such
risk percentages are applied to individual loans based on loan type.


                                       18



<PAGE>

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.
Loans considered  impaired under SFAS 114 are included in non-performing  loans.
However,  at March 31,  2002,  a  potential  problem  loan,  approximately  $2.4
million,  still  considered by the Bank to be impaired,  was not included in the
non-performing asset table below due to the terms of the loan being renegotiated
and currently being met by the borrower.  Loans are considered  impaired if full
principal  or interest  payments  are not  anticipated  in  accordance  with the
contractual  loan  terms.  An impaired  loan is 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
require an increase to the allowance for loan losses,  such 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
liquidated. Commercial  business and  real estate loan delinquencies are handled
on an  individual  basis by  management  with the  advice  of the  Bank's  legal
counsel.  Management  does not consider the overall  increase in  non-performing
assets during the period to be material or  indicative of any adverse  change in
overall asset quality.  The Bank anticipates that the increase in non-performing
loans will continue due to the growth of the Bank's loan portfolio.

Interest  income on loans is  recognized  on the accrual  basis except for those
loans in a  nonaccrual  of income  status.  The  accrual of interest on impaired
loans is discontinued when management believes,  after consideration of economic
and business  conditions  and collection  efforts that the borrowers'  financial
condition is such that collection of interest is doubtful. When interest accrual
is discontinued,  interest income is subsequently  recognized only to the extent
cash payments are received.

Real estate  acquired by the Bank as a result of  foreclosure or by deed in lieu
of foreclosure is classified as real estate owned until such time as it is sold.
When such  property  is  acquired  it is  recorded  at the  lower of the  unpaid
principal  balance of the related loan or its fair market value.  Any write-down
of the property is charged to the allowance for loan losses. The following table
presents  information with respect to the Bank's  non-performing  assets for the
periods indicated.

                                                     MARCH 31,      JUNE 30,
                                                       2002          2001
                                                     --------       -------

                                                      (DOLLARS IN THOUSANDS)

          Past due 90 days still on accrual          $    -          $  -
          Loans on non-accrual status (1)(2)           1,292          2,720
          Real estate acquired
             through foreclosure                         578            296
          Repossessed assets                             125             70
                                                      ------          -----

                  Total non-performing assets         $1,995         $3,086
                                                      ======         ======

          Ratios:  Non-performing loans                  .25%           .52%
                    to loans
                   Non-performing assets
                    to total assets                      .31%           .51%

(1)         Loans on non-accrual status include impaired loans,
            except for a potential problem loan of $2.4 million.
(2)         The interest income that would have been earned and
            received   on non-accrual loans was approximately
            $79,000 for the nine month  period  ending March 31,
            and 227,000 for the year ending June 30.


                                       19
<PAGE>

LIQUIDITY

The Bank maintains  sufficient liquidity to fund loan demand and routine deposit
withdrawal  activity.  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 securities maturities,  and
earnings from  operations  retained by the Bank. The Bank intends to continue to
fund loan growth  (outstanding  loan  commitments were $1.3 million at March 31,
2002) with customer  deposits and additional  advances from the FHLB.  While the
Bank utilizes other funding sources in order to meet its liquidity  needs,  FHLB
borrowings remain a material  component of management's  balance sheet strategy.
Also,  proceeds  of  trust  preferred  securities  held by the  Corporation  are
available if needed.  At March 31, 2002, the Bank had an unused approved line of
credit in the  amount of $40  million  and  sufficient  collateral  to borrow an
additional $21.9 million in advances from the FHLB.

CAPITAL

Regulatory  agencies  measure  capital  adequacy  within a framework  that makes
capital  requirements,  in part,  dependent on the  individual  risk profiles of
financial institutions. The Bank continues to exceed the regulatory requirements
for Tier I,  Tier I  leverage  and total  risk-based  capital.  The  Corporation
intends  to  maintain  a  capital  position  that  meets or  exceeds  the  "well
capitalized"   requirements   as  defined  by  the  FDIC.   The  Bank's  average
stockholders'  equity to average  assets  ratio was 9.21% year to date March 31,
2002 compared to 8.97% at June 30, 2001. The Bank's actual and required  capital
amounts and ratios at March 31, 2002 are presented below:
<TABLE>
<CAPTION>

                                                                                                     TO BE CONSIDERED
                                                                                                     WELL CAPITALIZED
                                                                                                       UNDER PROMPT
                                                                             FOR CAPITAL                CORRECTION
                                                     ACTUAL               ADEQUACY PURPOSES          ACTION PROVISIONS
                                           -------------------------------------------------- ---------------- ---------
 AS OF MARCH 31, 2002:                       AMOUNT         RATIO        AMOUNT       RATIO        AMOUNT        RATIO
                                             ------         -----        ------       -----        ------        -----
  <S>                                      <C>             <C>         <C>            <C>        <C>            <C>
   Total risk-based capital (to risk-
     weighted assets)                       $51,585         11.6%       $35,431        8.0%       $44,288        10.0%
   Tier I capital (to risk-weighted
     assets)                                 47,847         10.8         17,715        4.0         26,573         6.0
   Tier I leverage capital (to
     average assets)                         47,847          7.7         24,908        4.0         31,135         5.0

</TABLE>

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  polices of the  Corporation.  Interest  rate risk is the exposure to
adverse changes in the net interest income as a result of market fluctuations in
interest  rates.  The ALCO,  on an ongoing  basis,  monitors  interest  rate and
liquidity  risk in order to  implement  appropriate  funding and  balance  sheet
strategies.  Management  considers  interest  rate  risk to be the  Bank's  most
significant market risk.

The Bank utilizes an earnings  simulation  model to analyze net interest  income
sensitivity.  Potential  changes in market  interest rates and their  subsequent
effects on net interest income are then evaluated. The model projects the effect
of  instantaneous  movements in interest rates of both 100 and 200 basis points.
Assumptions  based on the  historical  behavior of the Bank's  deposit rates and
balances in relation to changes in interest rates are also incorporated into the
model.  These assumptions are inherently  uncertain and, as a result,  the model
cannot  precisely  measure future net interest  income or precisely  predict the
impact of fluctuations in market interest rates on net interest  income.  Actual
results will differ from the model's simulated results due to timing,  magnitude
and frequency of interest  rate changes as well as changes in market  conditions
and the  application  and timing of various  management  strategies.


                                       20
<PAGE>

The Bank's interest  sensitivity profile changed from June 30, 2001 to March 31,
2002.  Given a sustained 100 basis point  downward shock to the yield curve used
in the simulation  model,  the Bank's base net interest income would increase by
an estimated 3.92% at June 30, 2001 compared to an increase of .88% at March 31,
2002.  Given a 100 basis  point  increase in the yield curve the Bank's base net
interest  income would decrease by an estimated  4.30% at June 30, 2001 compared
to a decrease of 4.09% at March 31, 2002.

The  interest  sensitivity  profile  of the Bank at any  point  in time  will be
affected  by a number of  factors.  These  factors  include  the mix of interest
sensitive assets and liabilities as well as their relative pricing schedules. It
is also influenced by market interest rates,  deposit growth,  loan growth,  and
other  factors.  The  table  below is  representative  only and is not a precise
measurement of the effect of changing  interest rates on the Bank's net interest
income in the future.
<TABLE>
<CAPTION>
                                                                          MARCH 31, 2002
                                                DECREASE IN RATES                                   INCREASE IN RATES
                                                ------------------                                  -----------------
                                             200               100                                 100             200
                                         BASIS POINTS      BASIS POINTS          BASE          BASIS POINTS    BASIS POINTS

                                                                        (Dollars in thousands)
<S>                                     <C>                <C>              <C>                <C>              <C>
PROJECTED INTEREST INCOME
     Loans                               $35,350            $37,505          $39,297            $40,756          $42,082
     Investments                           2,102              2,123            2,350              2,368            2,386
                                         -------            -------          -------            -------          -------
TOTAL INTEREST INCOME                     37,452             39,628           41,647             43,124           44,468

PROJECTED INTEREST EXPENSE
     Deposits                             11,095             13,034           15,031             17,133           19,489
     Borrowed funds                        3,728              3,809            4,030              4,328            4,433
                                         -------            -------          -------             ------           ------
TOTAL INTEREST EXPENSE                    14,823             16,843           19,061             21,461           23,922

NET INTEREST INCOME                      $22,629            $22,785          $22,586            $21,663          $20,546
Change from base                             $43               $199                               $(923)         $(2,040)
% Change from base                           .19%               .88%                              (4.09)%          (9.03)%

</TABLE>

<TABLE>
<CAPTION>

                                                                           JUNE 30, 2001
                                                DECREASE IN RATES                                   INCREASE IN RATES
                                               ------------------                                   -----------------
                                             200               100                                 100            200
                                          BASIS POINTS     BASIS POINTS          BASE         BASIS POINTS    BASIS POINTS

                                                                        (Dollars in thousands)
<S>                                     <C>                <C>              <C>                <C>              <C>
PROJECTED INTEREST INCOME
     Loans                               $40,259            $41,873          $43,221            $44,342          $45,361
     Investments                           2,068              2,184            2,271              2,507            2,628
                                          ------             ------          -------             ------           ------
TOTAL INTEREST INCOME                     42,327             44,057           45,492             46,849           47,989

PROJECTED INTEREST EXPENSE
     Deposits                             16,858             19,092           21,326             23,560           25,149
     Borrowed funds                        3,734              3,735            3,736              3,738            3,785
                                          ------            -------           ------             ------           ------
TOTAL INTEREST EXPENSE                    20,592             22,827           25,062             27,298           28,934

NET INTEREST INCOME                      $21,735            $21,230          $20,430            $19,551          $19,055
Change from base                          $1,305               $800                               $(879)         $(1,375)
% Change from base                          6.39%              3.92%                              (4.30)%          (6.73)%


</TABLE>


                                       21

<PAGE>

                 FIRST FEDERAL FINANCIAL CORPORATION OF KENTUCKY


PART II - OTHER INFORMATION

      Item 1.          Legal Proceedings

                       Although  the Bank is,  from  time to time,  involved  in
                       various  legal   proceedings  in  the  normal  course  of
                       business, there are no material pending legal proceedings
                       to which the  Corporation,  the Bank, or its subsidiaries
                       is a party, or to which any of their property is subject.

      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
                       None

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











                                       22


<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 14, 2002       BY: (S)  B. Keith Johnson
                               ------------------------------------
                               B. Keith Johnson
                               President and Chief Executive Officer

DATE:  May 14, 2002       BY: (S) Charles E. Chaney
                               --------------------------
                               Charles E. Chaney
                               Senior Vice President
                               Chief Operating Officer












                                       23