<PAGE>
<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
______________________________
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1999
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE
ACT
FOR THE TRANSITION PERIOD FROM ____________ TO ____________
COMMISSION FILE NUMBER 333-72371
KENTUCKY NATIONAL BANCORP, INC.
- -----------------------------------------------------------------
(Exact name of Small Business Issuer as specified in its Charter)
Indiana 61-1345603
- ------------------------------- --------------------
(State or other jurisdiction of (IRS Employer
organization) Identification No.)
1000 North Dixie Avenue, Elizabethtown, Kentucky 42701
- ------------------------------------------------ ----------
(Address of principal executive offices) (Zip code)
Issuer's telephone number, including area code: (270)737-6000
-------------
Check whether the issuer (1) filed all reports required to
be filed by Section 13 or 15(d) of the Exchange Act during the
past 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.
X Yes No
___ ___
As of June 30, 1999, there were 240,000 shares of the
Registrant's common stock, par value $.01 per share,
outstanding.
Transitional Small Business Issuer Disclosure Format (check
one):
Yes X No
___ ___
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KENTUCKY NATIONAL BANCORP, INC.
Elizabethtown, Kentucky
Index
PAGE
PART I. ----
- ------
FINANCIAL INFORMATION
Item 1.
Consolidated Statement of Condition as of June 30,
1999 and December 31, 1998 (Unaudited) 3
Consolidated Statement of Operations - (Unaudited)
for the three months and six months ended
June 30, 1999 and 1998 4
Consolidated Statement of Cash Flows - (Unaudited)
for the six months ended June 30, 1999 and 1998 5
Notes to Consolidated Financial Statements (Unaudited) 6
Item 2.
Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
PART II.
- -------
OTHER INFORMATION
Item 4. Submission of Matters to a Vote of
Security Holders 11
Item 6. Exhibits and Reports on Form 8-K 11
Signatures 12
2
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KENTUCKY NATIONAL BANCORP, INC.
CONSOLIDATED STATEMENT OF CONDITION
(UNAUDITED)
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
1999 1998
-------- ------------
<S> <C> <C>
ASSETS
Cash and due from banks $ 1,326,520 $ 924,798
Federal funds sold 19,000 -
Investment in Federal Home Loan Bank 159,800 96,900
Investment in Federal Reserve Stock 180,000 180,000
Loans, net 43,347,707 34,200,584
Premises and equipment 2,004,183 1,933,623
Accrued interest receivable and other
assets 402,655 492,711
----------- -----------
Total assets $47,439,865 $37,828,616
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES:
Deposits $39,830,251 $30,512,242
Federal funds purchased -- 447,000
Federal Home Loan Bank advances 1,000,000 --
Obligations under capital leases 1,327,868 1,349,196
Accrued interest payable and other
liabilities 358,715 324,491
----------- -----------
Total liabilities 42,516,834 32,632,929
----------- -----------
STOCKHOLDERS' EQUITY:
Preferred stock, $.01 par value;
authorized 1,000,000 shares -- --
1999 -- Common stock $.01 par value;
authorized, 5,000,000 shares; issued
and outstanding 240,000 shares 2,400 --
1998 - Common stock, $1 par value;
auhorized, 1,000,000 shares; issued
and outstanding, 240,000 shares -- 240,000
Surplus 5,202,590 5,762,966
Retained deficit (281,959) (807,279)
----------- -----------
Total stockholders' equity 4,923,031 5,195,687
----------- -----------
Commitments and contingent liabilities -- --
----------- -----------
Total liabilities and stockholders'
equity $47,439,865 $37,828,616
=========== ===========
</TABLE>
See notes to consolidated financial statements.
3
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KENTUCKY NATIONAL BANCORP, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE THREE MONTHS AND SIX MONTHS ENDED JUNE 30, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
--------------------- ---------------------
1999 1998 1999 1998
------ ------- -------- -------
<S> <C> <C> <C> <C>
Interest income:
Loans, including fees $947,674 $ 479,883 $1,780,176 $ 788,743
Securities 5,400 2,265 8,452 2,265
Federal funds sold 1,272 27,693 6,078 55,944
-------- --------- ---------- ---------
Total interest income 954,346 509,841 1,794,706 846,952
-------- --------- ---------- ---------
Interest expense:
Deposit accounts 291,248 142,039 564,717 204,876
Certificates of deposit
over $100,000 130,935 83,569 252,144 145,272
Interest expense - federal funds 11,442 -- 15,838 --
Interest expense - capital lease 33,866 36,330 67,870 36,330
-------- --------- ---------- ---------
Total interest expense 467,491 261,938 900,569 386,478
-------- --------- ---------- ---------
Net interest income 486,855 247,903 894,137 460,474
Provision for loan losses 83,234 33,685 258,804 133,685
-------- --------- ---------- ---------
Net interest income after
provision for loan losses 403,621 214,218 635,333 326,789
-------- --------- ---------- ---------
Other income:
Service charges and fees 66,369 47,888 122,691 69,523
Credit life and accident insurance 12,222 17,735 17,345 26,741
-------- --------- ---------- ---------
78,591 65,623 140,036 96,264
-------- --------- ---------- ---------
Other expenses:
Salaries and employee benefits 201,839 178,660 400,449 290,566
Net occupancy expense 31,822 22,673 60,602 29,417
Advertising 27,884 21,620 61,816 57,289
Data processing 25,168 4,537 73,757 13,191
Postage, telephone and supplies 21,436 13,517 48,777 36,435
Directors fees 19,110 19,110 38,010 38,110
Professional services 40,459 81,908 96,513 152,694
Other operating expenses 60,765 51,897 120,635 66,023
-------- --------- ---------- ---------
428,483 393,922 900,559 683,725
-------- --------- ---------- ---------
Income (loss) before income taxes
and cumulative effect of accounting
change 53,729 (114,081) (125,190) (260,672)
Income taxes -- -- -- --
-------- --------- ---------- ---------
Net income (loss) before cumulative
effect of accounting change 53,729 (114,081) (125,190) (260,672)
Cumulative effect of accounting
change -- -- (156,769) --
-------- --------- ---------- ---------
Net income (loss) $ 53,729 $(114,081) $ (281,959) $(260,672)
======== ========= ========== =========
Earnings (loss) per share $ .22 $ (.47) $ (1.17) $ (1.08)
======== ========= ========== =========
</TABLE>
See notes to consolidated financial statements.
4
<PAGE>
<PAGE>
KENTUCKY NATIONAL BANCORP, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1999 AND 1998
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JUNE 30,
---------------------
1999 1998
-------- --------
<S> <C> <C>
Operating activities:
Net loss $ (281,959) $ (260,672)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Provision for loan losses 258,804 133,685
Provision for depreciation 44,420 18,861
Provision for amortization -- 20,627
Incentive stock option plan 9,303 14,733
Cumulative effect of accounting change 156,769 --
Changes in assets and liabilities:
Increase in accrued interest receivable
and other assets (66,713) (160,668)
Increase in accrued interest payable 34,224 167,827
Decrease in due to banks -- (631,250)
----------- ------------
Net cash provided (used) by
operating activities 154,848 (696,857)
----------- ------------
Investing activities:
Purchase of Federal Home Loan Bank Stock (62,900) --
Net increase in loans (9,405,927) (14,539,060)
Purchases of premises and equipment (114,980) (149,043)
----------- ------------
Net cash used in investing
activities (9,583,807) (14,688,103)
----------- ------------
Financing activities:
Net increase in deposits 9,318,009 13,595,330
Payments on capital lease obligations (21,328) (20,647)
Net decrease in federal funds purchased (447,000) --
Federal Home Loan Bank advances 1,000,000 --
----------- ------------
Net cash provided by financing
activities 9,849,681 13,574,683
----------- ------------
Net increase (decrease) in cash and cash
equivalents 420,722 (1,810,277)
Cash and cash equivalents, beginning of period 924,798 4,353,888
----------- ------------
Cash and cash equivalents, end of period $ 1,345,520 $ 2,543,611
=========== ============
SUPPLEMENTAL DISCLOSURES:
Cash paid for interest $ 892,073 $ 166,510
=========== ============
</TABLE>
NONCASH TRANSACTIONS:
During the six month period ended June 30, 1998, the Bank
recorded assets and obligations for bank equipment and building
under capital leases in the amount of $205,034 and $783,000,
respectively.
See notes to consolidated financial statements.
5
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KENTUCKY NATIONAL BANCORP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. BASIS OF PRESENTATION
Kentucky National Bancorp, Inc., (the Company) became the
holding company for Kentucky National Bank (the Bank) on
May 18, 1999 by issuing and exchanging its stock on a share
for share basis for the outstanding stock of the Bank. The
transfer of stock between the entities under common control
was accounted for at historical cost in a manner similar to
a pooling of interests. Accordingly, the 1999 financial
statements are presented as if the holding company
formation occurred on January 1, 1999.
The unaudited consolidated financial statements include the
accounts of Kentucky National Bancorp, Inc., and its
subsidiary Kentucky National Bank, for periods presented in
1999 and the accounts of Kentucky National Bank for periods
presented in 1998. All material intercompany balances and
transactions have been eliminated in consolidation.
The accompanying unaudited consolidated financial
statements were prepared in accordance with instructions
for Form 10-QSB and therefore, do not include all
disclosures necessary for a complete presentation of the
statement of financial condition, statement of loss,
statement of stockholders' equity, and statement of cash
flows in conformity with generally accepted accounting
principles. However, all adjustments which are, in
the opinion of management, necessary for the fair
presentation of the interim financial statements have been
included. The statement of income for periods presented is
not necessarily indicative of the results which may be
expected for the entire year.
2. FEDERAL HOME LOAN BANK ADVANCES
At June 30, 1999, the Bank had $1,000,000 in advances from
Federal Home Loan Bank (FLHB) of Cincinnati. Advances
generally mature within one to four days from the
transaction date. All advances are secured by 100% of the
Bank's mortgage loan portfolio and all FHLB stock.
3. EARNINGS (LOSS) PER SHARE
Earnings (loss) per share has been determined in accordance
with Statements of Financial Accounting Standards No. 128,
"Earnings per Share."
Earnings (loss) per share for the six month periods ended
June 30, 1999 and 1998 and for the three month periods
ended June 30, 1998 and 1999 have been computed based on
the weighted average number of shares outstanding
throughout the period of 240,000. Diluted earnings (loss)
per share has not been presented as the effect of options
granted at inception to purchase 16,000 shares of common
stock is either immaterial or antidilutive.
4. NEW ACCOUNTING STANDARDS
In April 1998, Accounting Standards Executive Committee
issued Statement of Position 98-5, "Reporting on the Costs
of Start-up activities," effective for financial statements
for fiscal years beginning after December 15, 1998. In
accordance with this standard, the Bank expensed on January
1, 1999, unamortized start-up costs in the amount of
$156,769 as a cumulative effect of a change in accounting
principle.
6
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<PAGE>
5. RECLASSIFICATIONS
Certain 1998 amounts have been reclassified to conform with
the 1999 presentation.
7
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<PAGE>
ITEM 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
GENERAL
The following discussion and analysis is intended to assist in
understanding the financial condition and the results of
operations
of the Company.
FORWARD-LOOKING STATEMENTS
When used in this discussion and elsewhere in this Quarterly
Report on Form 10-QSB, the words or phrases "will likely
result," "are expected to," "will continue," "is anticipated,"
"estimate," "project" or similar expressions are intended to
identify "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. The Company
cautions readers not to place undue reliance on any such
forward-looking statements, which speak only as of the date
made, and advises readers that various factors, including
regional and national economic conditions, substantial changes
in level of market interest rates, credit and other risks
of lending and investment activities and competitive and
regulatory factors could affect the Company's financial
performance and could cause the Company's actual results for
future periods to differ materially from those anticipated or
projected.
The Company does not undertake and specifically disclaims any
obligation to update any forward-looking statements to reflect
occurrence of anticipated or unanticipated events or
circumstances after the date of such statements.
COMPARISON OF FINANCIAL CONDITION AT JUNE 30, 1999 AND DECEMBER
31, 1998
Growth trends in loans and deposits continued to be strong in
the second quarter of 1999. Total assets increased $9.6
million, or 25.4%, to $47.4 million at June 30, 1999 compared to
$37.8 million at December 31, 1998. The increase in total
assets was attributable to a $9.1 million or 26.7% increase in
the loan portfolio. Also contributing to the increase in assets
was a $401,722, or 43.4% increase in cash and due from banks as
the Bank has sought to increase liquidity.
Funding for the Bank's asset growth came primarily from
increased deposits. At June 30, 1999, deposits totaled $39.8
million, a $9.3 million, or 30.5%, increase over deposits at
December 31, 1998. During this quarter, the Bank increased
liquidity through Federal Home Loan Bank (FHLB) advances in the
amount of $1,000,000. These advances are part of a formal
liquidity strategy implemented by the Bank. The strategy also
includes increased deposits through the Bank's recently opened
branch location and internet banking site, participating
existing loans, and the establishment of an investment
securities portfolio to ensure the Bank's liquidity position.
Stockholders equity decreased to $4.9 million at June 30, 1999
from $5.2 million at December 31, 1998 as the result of retained
losses for the six month period. The Bank continues to be in
compliance with all applicable regulatory capital requirements
as well as the requirement imposed by the Federal Deposit
Insurance Corporation that it maintain Tier 1 Capital equal to
8% of assets for the first three years of operations.
COMPARISON OF THE RESULTS OF OPERATIONS FOR THE THREE AND SIX
MONTH PERIODS ENDED JUNE 30, 1999 AND 1998
NET INCOME (LOSS). Net income for the quarter ended June 30,
1999 was $53,700 or $.22 per share compared to a net loss of
$114,100 or $.47 for the same period last year, an increase of
$167,800 or $.69 per share. Earnings improved for the quarter
largely as a result of the increase in net interest income from
bank growth relative to a small increase in other expenses. The
year to date loss at June 30, 1999 was $282,000 or $1.17 per
share compared to a net loss of $260,700 or $1.08 per share for
the same period in 1998. The increase of the net loss for the
six months ended June 30, 1999 in comparison to the six months
ended June 30, 1998, resulted primarily from the implementation
of SOP 98-5, "Reporting on the Costs of Start-up Activities,"
effective for financial statements for fiscal years beginning
after December 15, 1998. Implementation of this standard
required an expense of previously capitalized start-up costs in
the amount of $156,800, which was reported as a cumulative
effect of a change in accounting principle. An additional
factor in the increase, as discussed below, was the addition to
the provision for loan losses for a specific charge off of
$120,000.
NET INTEREST INCOME. Net interest income was $486,900 and
$247,900, for the quarters ended June 30, 1999 and 1998,
respectively. Year to date net interest income was $894,100 and
$460,500 for the six months ended June 30, 1999 and 1998,
respectively. The increase of $239,000 or 96% for the quarter
ended June 30, 1999 and the year to date increase of $433,600 or
94% for the six months ended June 30, 1999 reflects the
significant growth in loans and deposits from June 30, 1998 to
June 30, 1999. Management expects that the level of net
interest income will continue to improve as the loan portfolio
grows.
PROVISION FOR LOAN LOSSES. The provision for loan losses was
$83,200 and $33,685 for the quarters ended June 30, 1999 and
1998, respectively. The increase of $49,500 is relative to the
increase in loans for the quarter. The year to date provision
for loan losses was $258,800 and $133,700 for the six months
ended June 30, 1999 and 1998, respectively. The year to date
increase of $125,100 was primarily due to a specific charge off
in the amount of $120,000 during the first quarter of 1999.
OTHER INCOME. Other income was $78,600 and $65,600 for the
quarters ended June 30, 1999 and 1998, respectively. Year to
date other income was $140,000 and $96,300 for the six months
ended June 30, 1999 and 1998, respectively. The increase for
the quarter of $13,000 or 20% and the year to date increase of
$43,700 or 45% is reflective of loan and deposit growth from
which other income of service charges, fees and credit life and
accident insurance are generated.
OTHER EXPENSE. Other expense was $428,500 and $393,900 for the
quarters ended June 30, 1999 and 1998, respectively. Year to
date other expense was $900,600 and $683,700 for the six months
ended June 30, 1999 and 1998, respectively. The increase for the
quarter of $34,600 or 9% and the year to date increase of
$216,800 or 32% was due primarily to the increases in salaries
and employee benefits of $23,200 for the quarter and $109,900
year to date. The growth in salaries and benefits is due to
bank growth and the addition of the branch location in December
1998. Other significant factors included increases in data
processing of $20,600 for the quarter and $31,200 for the year
to date, increases in net occupancy expense of $9,000 for the
quarter and $31,200 year to date and increases in other
operating expenses of $8,900 for the quarter and $54,600 year to
date. Increases in these factors were primarily due to the
addition of the branch location.
LIQUIDITY AND CAPITAL RESOURCES.
The Company currently has no operating business other than the
Bank and does not have material funding needs. In the future,
the Company may require funds for dividends and tax payments for
which it will rely on dividends and other distributions from the
Bank. The Bank is subject to various regulatory restrictions on
the payment of dividends.
The Bank's sources of funds for lending activities and
operations are deposits from its primary market area, funds
raised in its initial public offering, principal and interest
payments on loans, interest received on other investments and
federal funds purchased. The Bank is also eligible to borrow
from the FHLB of Cincinnati. Its principal funding commitments
are for the origination of loans, the payment of maturing
deposits and obligations under capital leases for buildings and
equipment. Deposits are considered a primary source of funds
supporting the Bank's lending and investment activities.
8
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At June 30, 1999, the Bank's ratio of loans to deposits was
108.8% compared to 112.1% at December 31, 1998. The
loan-to-deposit ratio is used as an indicator of a bank's
ability to originate additional loans and general liquidity.
The Bank's comparatively high loan-to-deposit ratio reflects
management's emphasis on building the loan portfolio and has
been possible because the Bank has funded a significant portion
of its loan growth with capital raised in its initial public
offering. Because the Bank's continued loan growth will depend
on deposit growth, management expects to place more emphasis on
building liquidity on the balance sheet and that the loan-
to-deposit ratio will decline. The Bank's strategies in this
regard include the sale of participations in loans and the
creation of an investment securities portfolio that can be used
as a source of liquidity and earnings.
The Bank's most liquid assets are cash and cash equivalents,
which are cash on hand, amounts due from financial institutions,
federal funds sold and money market mutual funds. The levels of
such assets are dependent on the Bank's operating financing and
investment activities at any given time. The variations in
levels of cash and cash equivalents are influenced by deposit
flows and anticipated future deposit flows.
Cash and cash equivalents (cash due from banks, interest-bearing
deposits in other financial institutions, and federal funds
sold), as of June 30, 1999, totaled $1.3 million compared to
$2.5 million at June 30, 1998. The Bank's cash flows were
provided mainly by financing activities including $9.3 million
from net deposit increases. Operating activities provided
$154,848 in cash for the six months ended June 30, 1999 compared
to using $696,857 in cash in the first six months of 1998. The
Bank used cash flows for its investing activities primarily to
fund an increase in gross loans of $9.4 million.
As a national bank, the Bank is subject to the regulatory
capital requirements of the Office of the Comptroller of the
Currency ("OCC"). In order to be well capitalized under OCC
regulations, the Bank must maintain a leverage ratio of Tier 1
Capital to average assets of at least 5% and ratios of Tier 1
and total capital to risk-weighted assets of at least 6% and 10%
respectively. In addition, as a condition to the approval of
the insurance of its deposits, the FDIC required the Bank to
maintain a ratio of Tier 1 capital to assets of at least 8% for
the first three years of operations. At June 30, 1999, the Bank
satisfied the capital requirements for classification as well as
capitalized under OCC regulations and was in compliance with the
condition imposed by the FDIC in connection with the insurance
of its deposits.
YEAR 2000 READINESS DISCLOSURE.
Like most financial services companies, the Bank relies heavily
on computers and other information technology systems. As the
year 2000 approaches, an important business issue has emerged
regarding how existing application software programs and
operating systems can accommodate this date value. Form many
years, software applications routinely conserved magnetic
storage space by using only two digits to record calendar years;
for example, the year 1999 is stored as "99". On January 1,
2000, the calendars in many software applications will change
from "99" to "00". Many of these software applications, in
their current form, will produce erroneous results or will fail
to run at all since their logic cannot deal with this
transaction.
The Bank's Year 2000 plan calls for the identification of all
systems that could be affected by Year 2000 problem, the
systematic assessment of their Year 2000 readiness and
appropriate remedial measures and contingency planning,
including liquidity planning. As part of its Year 2000 plan,
the Bank has ranked its various computer systems according to
their importance to the continued functioning of the Bank.
Assessment procedures range from actual testing for the Bank's
most mission critical systems to seeking written self
assessments from individual customers. Based on these
assessments, the Bank has undertaken appropriate remedial
measures. The Bank's Year 2000 plan includes contingency and
back-up plans for mission critical systems.
9
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The Bank has identified its most mission critical systems as its
on-line core account processing which is performed by a third
party service provider. This service provider has advised the
Bank that it is Year 2000 compliant and has successfully done
testing with a number of its other customers. The service
provider tested the Bank's equipment and links during the fourth
quarter of 1998 and found them to be Year 2000 compliant. The
Bank has developed a contingency plan for back-up data
processing with another provider in the event its current data
processor in unable to operate because of Year 2000 problems.
The Bank also uses personal computers and a variety of other
software packages in other facets of its day-to-day operations.
These systems were all purchased just before the Bank opened in
October 1997 and were selected in part based on their millennium
compliance. Management believes that it has also identified all
the equipment which relies on embedded computer chips to operate
and has received correspondence from the vendors indicating that
they are Year 2000 compliant. In addition to the risks posed by
the Year 2000 readiness of its internal system, the Bank
recognizes that the Bank is exposed to Year 2000 risks from its
customers. Most of the Bank's loan customers are individuals
and small businesses which are not technologically intensive.
The Bank has surveyed its loan customers and believes that most
of its commercial loan customers will continue to operate even
if a Year 2000 problem disrupts their data processing functions.
The Bank is working to increase their awareness of the problem.
The Bank does not believe that the costs associated with its
Year 2000 planning will have a material impact on its results of
operations.
Based on its testing and preparation, management does not
currently believe that the Bank's mission-critical systems are
vulnerable to the Year 2000 problem or that the century date
change will materially disrupt internal operations.
Accordingly, management believes that the Bank's most
significant internal risk from the Year 2000 problem is either
that Year 2000 problems will affect the ability of some loans
customers to make payments on a timely basis or that problems
will occur in less critical systems. Management believes that
the Bank's most significant risk from the Year 2000 problem is
that the Year 2000 failures of others will cause an interruption
of basic services such as electrical power, telecommunications
or government services. Although the Bank has received
assurances of Year 2000 compliance from most of these providers,
there can be no assurance that Year 2000 failures on the part of
these parties will not have a material adverse effect on the
Bank.
10
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<PAGE>
Part II
OTHER INFORMATION
ITEM 4. Submission of Matters to a Vote of Security Holders
---------------------------------------------------
On April 27, 1999, the Bank held its annual meeting of
shareholders at which the following items were voted
on.
(1) Approval of the holding company reorganization:
NUMBER OF VOTES
For 170,800
Against 0
Abstain 1,294
There were no broker non-votes.
(2) Election of Directors
NOMINEE FOR WITH-
HELD
Robert E. Robbins, M.D. 171,805 289
Lawrence P. Calvert 171,805 289
Ronald J. Pence 171,805 289
Kevin D. Addingon 171,805 289
Henry Lee Chitwood 171,805 289
Lois Watkins Gray 171,805 289
William R. Hawkins 171,805 289
Christopher G. McKnight, M.D. 171,805 289
Leonard Allen McNutt 171,805 289
There were no abstentions or broker non-votes.
ITEM 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) The following exhibits are being filed with this
quarterly report on Form 10-QSB:
Number Description
------ -----------
27 Financial Data Schedule (EDGAR
Only)
(b) During the quarter ended June 30, 1999, the Company
did not file any current reports on Form 8-K.
11
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act
of 1934, the registrant had duly caused this report to be signed
on its behalf by the undersigned there unto duly authorized.
KENTUCKY NATIONAL BANCORP, INC.
Date: August 12, 1999 By: /s/ Ronald J. Pence
------------------------------
Ronald J. Pence, President
(Duly Authorized Represen-
tative and Principal
Financial Officer)
12
<TABLE> <S> <C>
<ARTICLE> 9
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> JUN-30-1999
<CASH> 1,326,520
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 19,000
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 0
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 43,794,421
<ALLOWANCE> (446,714)
<TOTAL-ASSETS> 47,439,865
<DEPOSITS> 39,830,251
<SHORT-TERM> 1,000,000
<LIABILITIES-OTHER> 1,686,583
<LONG-TERM> 0
0
0
<COMMON> 2,400
<OTHER-SE> 4,920,631
<TOTAL-LIABILITIES-AND-EQUITY> 47,439,865
<INTEREST-LOAN> 1,780,176
<INTEREST-INVEST> 8,452
<INTEREST-OTHER> 6,078
<INTEREST-TOTAL> 1,794,706
<INTEREST-DEPOSIT> 816,861
<INTEREST-EXPENSE> 900,569
<INTEREST-INCOME-NET> 894,137
<LOAN-LOSSES> 258,804
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 900,559
<INCOME-PRETAX> (125,190)
<INCOME-PRE-EXTRAORDINARY> (125,190)
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<CHANGES> (156,769)
<NET-INCOME> (281,959)
<EPS-BASIC> (1.17)
<EPS-DILUTED> (1.17)
<YIELD-ACTUAL> 8.2
<LOANS-NON> 53,039
<LOANS-PAST> 5,782
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 589,052
<ALLOWANCE-OPEN> 396,279
<CHARGE-OFFS> 32,798
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<ALLOWANCE-CLOSE> 446,714
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 446,714
</TABLE>
