UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549
FORM 10-QSB

(Mark One)
[ X ]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES 
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1996
or
[    ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES 
EXCHANGE ACT OF 1934
For the transition period from ____________________ to  ___________________

Commission File Number:  33-96358

BOURBON BANCSHARES, INC.
(Exact name of registrant as specified in its charter)

Kentucky							           61-0993464
(State or other jurisdiction of				      (I.R.S. Employer Identification No.)
incorporation or organization)

P.O. Box 157, Paris, Kentucky						40362-0157
(Address of principal executive offices)					(Zip Code)

Registrant's telephone number, including area code:  (606)987-1795

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 _____


Number of shares of Common Stock outstanding as of 
November 12, 1996:  1,415,699


BOURBON BANCSHARES, INC.

Table of Contents

Part I - Financial Information

Item 1.     Financial Statements

		Consolidated Balance Sheets				  3

		Consolidated Statements of Income
			Nine Months Ending September 30, 1996 & 1995 	  4
			Three Months Ending September 30, 1996 & 1995	  5

		Consolidated Statements of Cash Flows
			Nine Months Ending September 30, 1996 & 1995 	  6
			Three Months Ending September 30, 1996 & 1995	  7
			
		Notes to Consolidated Financial Statements			  8

Item 2.     Management's Discussion and Analysis of Financial 
		Condition and Results of Operations			  8

Part II - Other Information						10

Signatures								10

Exhibits

	27	Financial Data Schedule					11



Item 1 - Financial Statements
<TABLE>
BOURBON BANCSHARES, INC.
CONSOLIDATED BALANCE SHEET  (unaudited)
(thousands)
<CAPTION>
9/30/9612/31/95
Assets
<S>                         <C>                 <C>
Cash & Due From Banks $      7,264  $      8,197 
Federal Funds Sold         1,175          2,850 
  Total Cash & Cash Equivalents $      8,439  $    11,047 
Investment Securities:
  Securities Held to Maturity       16,498        16,455 
  Securities Available for Sale       63,777        76,184 
Federal Home Loan Bank Stock         2,659          2,741 
Loans $  158,595  $  155,061 
Reserve for Loan Losses         2,026          1,860 
  Net Loans $  156,569  $  153,201 
Premises and Equipment         4,888          4,176 
Other Assets         5,831          5,627 
   Total Assets $  258,661  $  269,431 
Liabilities & Stockholders' Equity
Deposits
  Demand $    28,492  $    26,636 
  Savings & Interest Checking       67,743        57,340 
  Certificates of Deposit     120,390      129,373 
    Total Deposits $  216,625  $  213,349 
Repurchase Agreements         3,187          4,660 
Federal Funds Purchased               -            5,700 
Federal Home Loan Bank Advances       10,599        19,071 
Other Borrowed Funds         2,109          1,431 
Other Liabilities         2,219          2,053 
  Total Liabilities $  234,739  $  246,264 
  Stockholders' Equity
Common Stock $      8,252  $      6,482 
Retained Earnings       15,826        16,674 
Net Unrealized Gains (Losses) on Investment Securities     (156)   11 
  Total Stockholders' Equity $    23,922  $    23,167 
  Total Liabilities & Stockholders' Equity $  258,661  $  269,431 
</TABLE>
<TABLE>
BOURBON BANCSHARES, INC.
CONSOLIDATED INCOME STATEMENT  (unaudited)
(thousands, except per share amounts)
<CAPTION>
 Nine Months Ending 9/30/969/30/95
INTEREST INCOME:
<S>                         <C>                 <C>
Loans, including fees $      10,240  $      10,090 
Investment Securities           3,916            4,362 
Other              292               292 
  Total Interest Income $      14,448  $      14,744 
INTEREST EXPENSE:
Deposits $        6,555  $        6,602 
Other              800            1,280 
  Total Interest Expense $        7,355  $        7,882 
Net Interest Income $        7,093  $        6,862 
Loan Loss Provision              301               304 
Net Interest Income After Provision $        6,792  $        6,558 
OTHER INCOME:
Service Charges $        1,065  $        1,158 
Securities Gains (Losses)                29               (23)
Other              490               363 
  Total Other Income $        1,584  $        1,498 
OTHER EXPENSES:
Salaries and Benefits $        2,966  $        2,861 
Occupancy Expenses              655               664 
Other           2,164            2,185 
  Total Other Expenses $        5,785  $        5,710 
Income Before Taxes $        2,591  $        2,346 
Income Taxes              613               515 
Net Income $        1,978  $        1,831 
Primary earnings per share $          1.37  $          1.28 
</TABLE>
<TABLE>
BOURBON BANCSHARES, INC.
CONSOLIDATED INCOME STATEMENT  (unaudited)
(thousands, except per share amounts)
<CAPTION>
 Three Months Ending 9/30/969/30/95
INTEREST INCOME:
<S>                        <C>                 <C>
Loans, including fees $          3,491  $          3,551 
Investment Securities             1,345              1,487 
Other                  (6)                  (3)
  Total Interest Income $          4,830  $          5,035 
INTEREST EXPENSE:
Deposits $          2,172  $          2,278 
Other                247                 448 
  Total Interest Expense $          2,419  $          2,726 
Net Interest Income $          2,411  $          2,309 
Loan Loss Provision                100                 105 
Net Interest Income After Provision $          2,311  $          2,204 
OTHER INCOME:
Service Charges $             344  $             410 
Securities Gains (Losses)                   -                   (38)
Other                233                   79 
  Total Other Income $             577  $             451 
OTHER EXPENSES:
Salaries and Benefits $          1,021  $             922 
Occupancy Expenses                203                 207 
Other                838                 683 
  Total Other Expenses $          2,062  $          1,812 
Income Before Taxes $             826  $             843 
Income Taxes $             195  $             194 
Net Income $             631  $             649 
Primary earnings per share $            0.44  $            0.45 
</TABLE>
<TABLE>
BOURBON BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS  (unaudited)
(thousands)
<CAPTION>
 Nine Months Ending 9/30/969/30/95
Cash Flows From Operating Activities
<S>                 <C>                  <C>
Net Income $          1,978  $          1,831 
Adjustments to reconcile net income to
  net cash provided by operating activities:
Depreciation                328                 310 
Amortization                273                 296 
Investment securities (accretion) amortization, net         128         (41)
Provision for loan losses                301                 299 
Investment securities losses (gains), net                (29)           23 
Originations of loans held for sale         (20,302)         (15,106)
Proceeds from sale of loans           25,585            12,726 
Losses (gains) on sale of fixed assets                   -             (11)
Losses (gains) on sale of loans                  (4)                (55)
Losses (gains), including write-downs, on real
  estate acquired through foreclosure, net                   -          (90)
Adjustment to conform with pooled Companies' year end       -         (174)
Changes in:
  Interest receivable              (355)              (573)
  Income taxes refundable                   -                   194 
  Other assets                (36)                102 
  Interest payable                113                 279 
  Income taxes payable                126                    -   
  Other liabilities                (72)              (963)
    Net cash provided by operating activities $          8,034  $     (953)
Cash Flows From Investing Activities
Purchases of securities available for sale $      (26,256) $        (6,650)
Proceeds from sales of securities available for sale     7,248       11,605 
Proceeds from principal payments, maturities and
  calls of securities available for sale           31,141              8,091 
Purchase of securities held to maturity           (1,375)           (5,033)
Proceeds from sales, principal payments, maturities
  and calls of securities held to maturity             1,335          3,556 
Net change in loans           (9,005)           (7,280)
Purchases of bank premises and equipment           (1,040)              (192)
Proceeds from the sale of bank premises and equipment     -            100 
Proceeds from sales of real estate acquired through 
foreclosure                  57                 385 
    Net cash provided by investing activities $          2,105  $     4,582 
Cash Flows From Financing Activities:
Net change in deposits $          3,276  $      (11,139)
Net change in securities sold under agreements to
  repurchase and federal funds purchased           (7,173)             1,781 
Advances from Federal Home Loan Bank                400              2,000 
Payments on Federal Home Loan Bank advances           (8,872)        (1,404)
Net change in other borrowed funds                948                 785 
Proceeds from note payable                330                    -   
Payment on note payable              (600)              (750)
Repurchase of common stock              (369)                   -   
Proceeds from issuance of common stock                    1              46 
Dividends paid              (688)              (591)
    Net cash provided by financing activities $      (12,747) $     (9,272)
Net increase (decrease) in cash and cash equivalents $  (2,608)  $   (5,643)
Cash and cash equivalents at beginning of period     11,047         15,433 
Cash and cash equivalents at end of period $          8,439  $          9,790 
</TABLE>
<TABLE>
BOURBON BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS  (unaudited)
(thousands)
<CAPTION>
 Three Months Ending 9/30/969/30/95
Cash Flows From Operating Activities
<S>                           <C>                    <C>
Net Income $             631  $             649 
Adjustments to reconcile net income to
  net cash provided by operating activities:
Depreciation                109                 103 
Amortization                  91                   99 
Investment securities (accretion) amortization, net          61        (16)
Provision for loan losses                100                 100 
Investment securities losses (gains), net                   -          15 
Originations of loans held for sale         (13,876)           (8,229)
Proceeds from sale of loans           19,398              5,818 
Losses (gains) on sale of fixed assets                   -               -   
Losses (gains) on sale of loans                  (9)                (24)
Losses (gains), including write-downs, on real
  estate acquired through foreclosure, net                   -            -   
Adjustment to conform with pooled Companies' year end        -        (174)
Changes in:
  Interest receivable              (192)              (884)
  Income taxes refundable                   -                     45 
  Other assets                (81)                603 
  Interest payable                (15)                  (2)
  Income taxes payable                  71                    -   
  Other liabilities                462                 268 
    Net cash provided by operating activities $          6,750  $   (1,629)
Cash Flows From Investing Activities
Purchases of securities available for sale $        (5,028) $        (3,808)
Proceeds from sales of securities available for sale        -         1,994 
Proceeds from principal payments, maturities and
  calls of securities available for sale             4,084           3,671 
Purchase of securities held to maturity              (650)           (4,213)
Proceeds from sales, principal payments, maturities
  and calls of securities held to maturity                  45       2,911 
Net change in loans           (8,714)           (1,664)
Purchases of bank premises and equipment              (489)            (48)
Proceeds from the sale of bank premises and equipment      -           -   
Proceeds from sales of real estate acquired through 
foreclosure                   -                      -   
    Net cash provided by investing activities $      (10,752) $        (1,157)
Cash Flows From Financing Activities:
Net change in deposits $          3,203  $        (3,452)
Net change in securities sold under agreements to
  repurchase and federal funds purchased            1,062              6,063 
Advances from Federal Home Loan Bank                400                 -   
Payments on Federal Home Loan Bank advances           (2,746)       (1,282)
Net change in other borrowed funds                  29                (5)
Proceeds from note payable                330                    -   
Payment on note payable              (300)              (150)
Repurchase of common stock              (270)                   -   
Proceeds from issuance of common stock                    1             -   
Dividends paid              (230)             (181)
    Net cash provided by financing activities $          1,479 $      993 
Net increase (decrease) in cash and cash equivalents $   (2,523)  $  (1,793)
Cash and cash equivalents at beginning of period         10,962      11,583 
Cash and cash equivalents at end of period $          8,439  $       9,790 
</TABLE>
BOURBON BANCSHARES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. In Management's opinion, the financial information, which is unaudited, 
reflects all adjustments, (consisting solely of normal recurring adjustments)
necessary for a fair presentation of the financial information as of and for 
the nine month and three month periods ended September 30, 1996 and September 
30, 1995 in conformity with generally accepted accounting principles.  These 
financial statements should be read in conjunction with Bourbon Bancshares, 
Inc. (Company) Annual Report on Form 10-KSB.
2. Primary earnings per share is computed by dividing net income by weighted 
average number of shares of common stock outstanding and the number of 
shares of common stock which would be assumed outstanding under the treasury 
stock method upon exercise of stock options.
3. Dividends per share paid for the quarter ended September 30, 1996 was 
$0.16 compared to $0.15 on September 30, 1995.  This third quarter dividend 
was the same as was paid for the first and second quarters of 1996 and 1995.

Item 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
RESULTS OF OPERATIONS

Summary

Bourbon Bancshares, Inc. recorded net income of $1,978 thousand, or $1.37 per 
share on a primary basis for the first nine months ended September 30, 1996.  
These results compare to net income of $1,831 thousand or $1.28 share on a 
primary basis for 1995.  Third quarter's net income was $631 thousand or 
$0.44 per share on a primary basis for 1996 compared to $649 thousand or 
$0.45 per share on a primary basis  in 1995.

Return on average assets was 1.01% for the first nine months ended 
September 30, 1996 compared to 0.91% for the same time period in 1995.  
Third quarter's return on average assets was 0.97% for 1996 
and 0.96% for 1995.  Return on average equity was 11.2% and 11.4% for the nine 
months ended September 30, 1996 and 1995, respectively.  The three months 
ended September 30 revealed a return on average equity of 10.6% and 13.4% 
for 1996 and 1995, respectively.

Net Interest Income

Net interest income was $7,093 thousand for the nine months ended 
September 30, 1996 compared to $6,862 thousand in 1995, resulting in an 
increase of $231 thousand or 3.4%.  For the three months ended 
September 30, net interest income was $2,411 and $2,309 in 1996 and 1995, 
respectively.

Non-Interest Income

Non-interest income increased for the nine month period ended September 30 
from $1,498 thousand in 1995 to $1,584 thousand in 1996.  A decrease of $93 
thousand in service charges from 1995 to 1996 was offset by a $52 thousand 
increase in net gains on securities and a $127 thousand increase in other 
income from 1995 to 1996.  For the three month period ended September 30, 
1996 compared to the same period in 1995, service charges decreased $66 
thousand, while net security gains increased $38 thousand and 
other income increased $154 thousand.  During the first nine months of 1996, 
trust fees have decreased $14 thousand from 1995.  In addition, gains on 
loans sold amounted to $55 thousand through September 30, 1995, while gains 
of $4 thousand were incurred during this time period in 1996.



Non-Interest Expense

The explanations for the increase of  $75 thousand in non-interest expenses 
from $5,710 thousand for the nine months ended September 30, 1995 to $5,785 
thousand for the same period in 1996, and the increase of $250 thousand for 
the third quarter of 1996 compared to 1995 follows.  Salaries and benefits 
increased $105 thousand for the first nine months of 1995 to 1996, nearly a 
4% increase.  In 1995 an annuity amounting to over $57 thousand was 
purchased for a former manager of a savings association.  In the third 
quarter of 1996, an employee bonus amounting to nearly $32 thousand was 
earned.  Occupancy expense decreased $9 thousand for the first nine months of 
1996 compared to 1995.  For the first nine months of 1996 compared to 1995, 
other expenses decreased $21 thousand.  Other expenses for the third 
quarter of 1996 compared to 1995 increased $155 thousand, from $683 thousand 
to $838 thousand.  Within other expenses, the savings resulting from the 
decrease in FDIC insurance for commercial banks amounted to nearly $170 
thousand for the first nine months of 1996 compared to 1995.  However, 
this savings was more than offset by the one-time SAIF assessment amounting 
to nearly $303 thousand accrued during the third quarter of 1996.  In 
addition, net gains from the sale of other real estate of $90 thousand 
were recorded in 1995.

Income Taxes

The tax equivalent rate for the nine months ended September 30, 1996 and 
September 30, 1995 was 24% and 22%, respectively.  The rates for the three 
months ended September 30, 1996 and 1995 were 24% and 23%, respectively.  
These rates being less than the statutory rate is a result of the tax free 
securities and loans held by the Company.

Liquidity and Funding

The cash flow statements provide a useful analysis of liquidity.  This report 
reveals a decrease of cash and cash equivalents for the first nine months of 
1996 of $2,608 thousand and $5,643 thousand for the same period in 1995.  
In 1995, this is primarily attributable to a decrease in deposits of $11,139 
thousand, a decrease in securities of $11,569 thousand and a increase in 
total loans of $9,660 thousand.  During 1996,  $8,872 thousand was repaid on 
Federal Home Loan Bank advances and securities sold under agreements 
to repurchase decreased by $7,173 thousand.  These decreases in cash were 
offset in 1996 and 1995 by cash provided by operating activities and 
investing activities.  The decreases for the third quarter of 1996 
in cash and cash equivalents of $2,523 in 1996 and $1,793 in 1995 were 
mainly attributable to cash outflows from investing activities being than 
balanced out with net inflows from operating and financing 
activities.   Management believes there is sufficient liquidity to meet all 
reasonable borrower, depositor and creditor needs in the present economic 
environment.

Non-Performing Assets

As of September 30, 1996, the Company's non-performing assets totaled $1,074 
thousand or 0.7% of loans compared to $654 thousand or 0.4% of loans in 
1995.  Real estate loans composed over 91% and over 88% of the 
non-performing loans as of September 30, 1996 and 1995, respectively.

Provision and Reserve for Possible Loan Losses

The 1996 nine month provision for loan losses of $301 thousand compares to the 
1995 number of $304 thousand.  The third quarter provision for loan losses 
was $100 thousand for 1996 and $105 thousand for 1995.  The loan loss 
reserve to total loans increased from 1.16% on September 30, 1995 to 1.28% 
as of September 30, 1996.  Management feels the current loan loss reserve 
is sufficient to meet future loan problems.


Part II - Other Information

Item 1.     Legal Proceedings

	The Company is not a party to any material legal proceedings.

Item 2.     Changes in Securities

	None

Item 3.     Defaults upon Senior Securities

	None

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

	None

Item 5.     Other Information

	None

Item 6.     Exhibits and Reports on Form 8-K

	1.	Exhibits as required by Item 601 of Regulation S-B.

		27	Financial Data Schedule

	2.	No reports on Form 8-K have been filed during the quarter for which 
this report is filed.

SIGNATURES

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

					Bourbon Bancshares, Inc.

Date  __________________		_________________________________
					Buckner Woodford, President and C.E.O.

Date  __________________		_________________________________
					Gregory J. Dawson, Chief Financial Office