UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    FORM 10-Q

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

                  FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2002

                                       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 0-14412

                        FARMERS CAPITAL BANK CORPORATION
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)

            KENTUCKY                                     61-1017851
-------------------------------          ---------------------------------------
(State or other jurisdiction of          (I.R.S. Employer Identification Number)
incorporation or organization)

P.O. Box 309, 202 West Main Street
Frankfort, Kentucky                                       40602
---------------------------------------- ---------------------------------------
(Address of principal executive offices)               (Zip Code)

       Registrant's telephone number, including area code: (502) 227-1600

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.

                    Common stock, par value $0.125 per share
                 6,844,594 shares outstanding at August 8, 2002

<PAGE>
<TABLE>
<CAPTION>



                                                        TABLE OF CONTENTS


Part I - Financial Information                                                               Page No.
------------------------------                                                               --------

<S>                                                                                             <C>
     Item 1 - Financial Statements

         Unaudited Consolidated Balance Sheets -
             June 30, 2002 and December 31, 2001                                                 3

         Unaudited Consolidated Statements of Income -
             For the Three Months and Six Months Ended
             June 30, 2002 and June 30, 2001                                                     4

         Unaudited Consolidated Statements of Comprehensive Income -
             For the Three Months and Six Months Ended
             June 30, 2002 and June 30, 2001                                                     5

         Unaudited Consolidated Statements of Cash Flows -
             For the Six Months Ended
             June 30, 2002 and June 30, 2001                                                     6

         Unaudited Consolidated Statements of Changes in Shareholders' Equity -
             For the Six Months Ended
             June 30, 2002 and June 30, 2001                                                     7

         Notes to Unaudited Consolidated Financial Statements                                    8

     Item 2 - Management's Discussion and Analysis of Financial
                Condition and Results of Operations                                              9

     Item 3 - Quantitative and Qualitative Disclosures About Market Risk                        20

Part II - Other Information

     Item 1 - Legal Proceedings                                                                 21

     Item 4 - Submission of Matters to a Vote of Security Holders                               21

     Item 6 - Exhibits and Reports on Form 8-K                                                  22
</TABLE>

<PAGE>


PART I - FINANCIAL INFORMATION

Item 1. Financial Statements
----------------------------
<TABLE>
<CAPTION>

UNAUDITED CONSOLIDATED BALANCE SHEETS
--------------------------------------------------------------------------------------------------------------------------------
                                                                                              June 30,       December 31,
(In thousands, except per share data)                                                            2002               2001
--------------------------------------------------------------------------------------------------------------------------------
<S>                                                                                          <C>                <C>
ASSETS
 Cash and cash equivalents:
     Cash and due from banks                                                                 $ 116,143          $  55,977
     Interest bearing deposits in other banks                                                    4,095              3,090
     Federal funds sold and securities purchased under
          agreements to resell                                                                 124,353             47,318
--------------------------------------------------------------------------------------------------------------------------------
          Total cash and cash equivalents                                                      244,591            106,385
--------------------------------------------------------------------------------------------------------------------------------
Investment securities:
     Available for sale, amortized cost of $264,557 (2002) and $306,197 (2001)                 266,671            308,081
     Held to maturity, fair value of $34,042 (2002) and $38,505 (2001)                          32,461             37,461
--------------------------------------------------------------------------------------------------------------------------------
          Total investment securities                                                          299,132            345,542
--------------------------------------------------------------------------------------------------------------------------------
Loans, net of unearned income                                                                  695,226            701,869
Allowance for loan losses                                                                      (11,026)           (10,549)
--------------------------------------------------------------------------------------------------------------------------------
          Loans, net                                                                           684,200            691,320
--------------------------------------------------------------------------------------------------------------------------------
Premises and equipment, net                                                                     24,028             24,800
Other assets                                                                                    14,147             15,483
--------------------------------------------------------------------------------------------------------------------------------
          Total assets                                                                     $ 1,266,098        $ 1,183,530
--------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Deposits:
     Noninterest bearing                                                                   $   166,157        $   136,001
     Interest bearing                                                                          774,586            777,484
--------------------------------------------------------------------------------------------------------------------------------
          Total deposits                                                                       940,743            913,485
--------------------------------------------------------------------------------------------------------------------------------
Federal funds purchased and securities sold under agreements to repurchase                     145,443            113,792
Other short-term borrowings                                                                     19,491             12,808
Long-term debt                                                                                  26,349             10,913
Dividends payable                                                                                2,137              2,152
Other liabilities                                                                                7,098              6,820
--------------------------------------------------------------------------------------------------------------------------------
          Total liabilities                                                                  1,141,261          1,059,970
--------------------------------------------------------------------------------------------------------------------------------
Commitments and contingencies

SHAREHOLDERS' EQUITY
Common stock, par value $0.125 per share
     9,608,000 shares authorized; 8,104,735 and 8,058,244
     shares issued at June 30, 2002 and December 31, 2001, respectively                          1,013              1,007
Capital surplus                                                                                 16,608             15,179
Retained earnings                                                                              140,050            137,227
Treasury stock, at cost
     1,243,594 and 1,152,978 shares at June 30, 2002 and
     December 31, 2001, respectively                                                           (34,210)           (31,077)
Accumulated other comprehensive income                                                           1,376              1,224
--------------------------------------------------------------------------------------------------------------------------------
          Total shareholders' equity                                                           124,837            123,560
--------------------------------------------------------------------------------------------------------------------------------
          Total liabilities and shareholders' equity                                       $ 1,266,098        $ 1,183,530
--------------------------------------------------------------------------------------------------------------------------------
See accompanying notes to unaudited consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>

 UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
--------------------------------------------------------------------------------------------------------------------------------
                                                                          Three Months Ended                 Six Months Ended
                                                                                June 30,                         June 30,
(In thousands, except per share data)                                     2002           2001               2002           2001
--------------------------------------------------------------------------------------------------------------------------------
<S>                                                                   <C>            <C>                <C>            <C>
INTEREST INCOME
Interest and fees on loans                                            $ 12,639       $ 15,315           $ 25,703       $ 30,707
Interest on investment securities:
     Taxable                                                             2,601          2,525              5,343          5,165
     Nontaxable                                                            938            829              1,849          1,627
Interest on deposits in other banks                                        133             22                153             47
Interest of federal funds sold and securities
     purchased under agreements to resell                                  244            885                455          2,075
--------------------------------------------------------------------------------------------------------------------------------
          Total interest income                                         16,555         19,576             33,503         39,621
--------------------------------------------------------------------------------------------------------------------------------
INTEREST EXPENSE
Interest on deposits                                                     5,771          7,661             11,752         15,662
Interest on federal funds purchased and securities
     sold under agreements to repurchase                                   434            971                907          2,227
Interest on other borrowed funds                                           414            127                753            279
--------------------------------------------------------------------------------------------------------------------------------
          Total interest expense                                         6,619          8,759             13,412         18,168
--------------------------------------------------------------------------------------------------------------------------------
          Net interest income                                            9,936         10,817             20,091         21,453
--------------------------------------------------------------------------------------------------------------------------------
Provision for loan losses                                                  988          1,050              1,109          1,273
--------------------------------------------------------------------------------------------------------------------------------
          Net interest income after provision for loan losses            8,948          9,767             18,982         20,180
--------------------------------------------------------------------------------------------------------------------------------
NONINTEREST INCOME
Service charges and fees on deposits                                     1,960          1,747              3,779          3,301
Other service charges, commissions, and fees                               908            970              1,803          1,893
Data processing income                                                     387            380                723            708
Trust income                                                               361            507                728            893
Investment securities gains, net                                           396            186                993            465
Gain on sale of mortgage loans                                              57             65                112             97
Other                                                                       72             78                124            148
--------------------------------------------------------------------------------------------------------------------------------
          Total noninterest income                                       4,141          3,933              8,262          7,505
--------------------------------------------------------------------------------------------------------------------------------
NONINTEREST EXPENSE
Salaries and employee benefits                                           4,801          4,565              9,951          9,499
Occupancy expenses, net                                                    588            609              1,159          1,193
Equipment expenses                                                         914            774              1,840          1,581
Bank franchise tax                                                         306            297                613            593
Other                                                                    2,082          2,089              4,165          4,016
--------------------------------------------------------------------------------------------------------------------------------
          Total noninterest expense                                      8,691          8,334             17,728         16,882
--------------------------------------------------------------------------------------------------------------------------------
          Income before income taxes                                     4,398          5,366              9,516         10,803
--------------------------------------------------------------------------------------------------------------------------------
Income tax expense                                                       1,082          1,470              2,418          3,001
--------------------------------------------------------------------------------------------------------------------------------
          Net income                                                   $ 3,316        $ 3,896            $ 7,098        $ 7,802
--------------------------------------------------------------------------------------------------------------------------------
NET INCOME PER COMMON SHARE
     Basic                                                             $   .48        $   .56            $  1.03        $  1.11
     Diluted                                                               .48            .56               1.02           1.11
--------------------------------------------------------------------------------------------------------------------------------
WEIGHTED AVERAGE SHARES OUTSTANDING
     Basic                                                               6,889          6,949              6,895          7,023
     Diluted                                                             6,941          6,978              6,943          7,050
--------------------------------------------------------------------------------------------------------------------------------
See accompanying notes to unaudited consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>

UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
--------------------------------------------------------------------------------------------------------------------------------
                                                                          Three Months Ended                Six Months Ended
                                                                               June 30,                          June 30,
(In thousands)                                                            2002           2001               2002          2001
--------------------------------------------------------------------------------------------------------------------------------
<S>                                                                    <C>            <C>                <C>           <C>
NET INCOME                                                             $ 3,316        $ 3,896            $ 7,098       $ 7,802
Other comprehensive income (loss):
     Unrealized holding gain on available for sale
     securities arising during the period, net of tax
     of $771, $50, $405, and $544, respectively                          1,432             98                753         1,056
Reclassification adjustment for prior period
     unrealized gain recognized during current period,
     net of tax of $57, $52, $324, and $123, respectively                 (106)          (100)              (601)         (239)
--------------------------------------------------------------------------------------------------------------------------------
Other comprehensive income (loss)                                        1,326             (2)               152           817
--------------------------------------------------------------------------------------------------------------------------------
Comprehensive Income                                                   $ 4,642        $ 3,894            $ 7,250       $ 8,619
--------------------------------------------------------------------------------------------------------------------------------
See accompanying notes to unaudited consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
--------------------------------------------------------------------------------------------------------------------------------
Six months ended June 30, (In thousands)                                                             2002           2001
--------------------------------------------------------------------------------------------------------------------------------
<S>                                                                                              <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES
     Net income                                                                                  $  7,098        $ 7,802
     Adjustments to reconcile net income to net cash provided
         by operating activities:
          Depreciation and amortization                                                             1,472          1,520
          Net amortization (accretion) of investment security premiums and discounts:
                Available for sale                                                                    342           (223)
                Held to maturity                                                                      (33)            (1)
          Provision for loan losses                                                                 1,109          1,273
          Noncash compensation expense                                                                296            464
          Mortgage loans originated for sale                                                      (14,399)       (18,580)
          Proceeds from sale of mortgage loans                                                     14,341         18,063
          Deferred income tax (benefit) expense                                                       (95)            14
          Gain on sale of mortgage loans                                                             (112)           (97)
          Gain on sale of premises and equipment                                                       (1)            (2)
          Gain on sale of available for sale investment securities, net                              (993)          (465)
          Decrease in accrued interest receivable                                                   1,154            757
          Decrease (increase) in other assets                                                         182           (945)
          Decrease in accrued interest payable                                                       (261)          (178)
          Increase in other liabilities                                                               556            691
--------------------------------------------------------------------------------------------------------------------------------
             Net cash provided by operating activities                                             10,656         10,093
--------------------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES
     Proceeds from maturities and calls of investment securities:
          Available for sale                                                                      222,201        217,372
          Held to maturity                                                                          5,033          7,570
     Proceeds from sale of available for sale investment securities                               125,436          7,694
     Purchase of investment securities:
          Available for sale                                                                     (305,346)      (233,817)
          Held to maturity                                                                                          (334)
     Loans originated for investment, net of principal collected                                    6,181        (17,728)
     Purchase of premises and equipment                                                              (701)        (1,580)
     Proceeds from sale of equipment                                                                    2              4
--------------------------------------------------------------------------------------------------------------------------------
             Net cash provided by (used in) investing activities                                   52,806        (20,819)
--------------------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
     Net increase (decrease) in deposits                                                           27,258        (73,184)
     Net increase in securities sold under agreements to repurchase                                31,651         19,349
     Proceeds from long-term debt                                                                  16,500
     Repayments of long-term debt                                                                  (1,064)        (3,344)
     Net increase (decrease) in other short-term borrowings                                         6,683           (389)
     Dividends paid                                                                                (4,290)        (4,299)
     Purchase of common stock                                                                      (3,133)        (8,238)
     Stock options exercised                                                                        1,139             63
--------------------------------------------------------------------------------------------------------------------------------
             Net cash provided by (used in) financing activities                                   74,744        (70,042)
--------------------------------------------------------------------------------------------------------------------------------
             Net increase (decrease) in cash and cash equivalents                                 138,206        (80,768)
--------------------------------------------------------------------------------------------------------------------------------
Cash and cash equivalents at beginning of year                                                    106,385        229,871
--------------------------------------------------------------------------------------------------------------------------------
             Cash and cash equivalents at end of period                                          $244,591       $149,103
--------------------------------------------------------------------------------------------------------------------------------
SUPPLEMENTAL DISCLOSURES
Cash paid during the period for:
     Interest                                                                                    $ 13,673       $ 18,346
     Income taxes                                                                                   2,490          3,100
Cash dividend declared and unpaid                                                                   2,137          2,084
--------------------------------------------------------------------------------------------------------------------------------
See accompanying notes to unaudited consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>

UNAUDITED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
------------------------------------------------------------------------------------------------------------------------------------
(In thousands, except per share data)                                                                  Accumulated
                                                                                                           Other           Total
Six months ended                        Common Stock       Capital    Retained    Treasury Stock      Comprehensive    Shareholders'
June 30, 2002 and 2001                Shares   Amount      Surplus    Earnings   Shares     Amount        Income          Equity
------------------------------------------------------------------------------------------------------------------------------------
<S>                                   <C>      <C>         <C>       <C>         <C>     <C>              <C>            <C>
  Balance at January 1, 2002          8,058    $1,007      $15,179   $ 137,227   1,153   $ (31,077)       $ 1,224        $123,560
Net income                                                               7,098                                              7,098
Other comprehensive income                                                                                    152             152
Cash dividends declared,
  $.62 per share                                                        (4,275)                                            (4,275)
Purchase of common stock                                                            91      (3,133)                        (3,133)
Stock options exercised                  47         6        1,133                                                          1,139
Noncash compensation expense
  attributed to stock option grants                            296                                                            296
------------------------------------------------------------------------------------------------------------------------------------
  Balance at June 30, 2002            8,105    $1,013      $16,608   $ 140,050   1,244   $ (34,210)       $ 1,376        $124,837
------------------------------------------------------------------------------------------------------------------------------------


------------------------------------------------------------------------------------------------------------------------------------
  Balance at January 1, 2001          8,032    $1,004      $13,634   $ 131,021     860   $ (20,755)       $   557        $125,461
Net income                                                               7,802                                              7,802
Other comprehensive income                                                                                    817             817
Cash dividends declared,
  $.60 per share                                                        (4,228)                                            (4,228)
Purchase of common stock                                                           234      (8,238)                        (8,238)
Stock options exercised                   2                     63                                                             63
Noncash compensation expense
  attributed to stock option grants                            464                                                            464
------------------------------------------------------------------------------------------------------------------------------------
  Balance at June 30, 2001            8,034    $1,004      $14,161   $ 134,595   1,094   $ (28,993)       $ 1,374       $ 122,141
------------------------------------------------------------------------------------------------------------------------------------
See accompanying notes to unaudited consolidated financial statements.
</TABLE>
<PAGE>


NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

1.   BASIS OF PRESENTATION

The consolidated  financial  statements  include the accounts of Farmers Capital
Bank  Corporation  (the  "Company"),   a  financial  holding  company,  and  its
subsidiaries,  including its principal subsidiary,  Farmers Bank & Capital Trust
Company.  All  significant  intercompany  transactions  and  accounts  have been
eliminated in consolidation.

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States of America requires  management to make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities  and disclosure of contingent  assets and liabilities as of the date
of the financial  statements  and the reported  amounts of revenues and expenses
during the reporting period.  Estimates used in the preparation of the financial
statements  are based on various  factors  including  the current  interest rate
environment  and the  general  strength  of the local  economy.  Changes  in the
overall  interest rate  environment can  significantly  affect the Company's net
interest  income and the value of its recorded  assets and  liabilities.  Actual
results  could  differ  from  those  estimates  used in the  preparation  of the
financial statements.

The  financial  information  presented as of any date other than December 31 has
been  prepared  from the books  and  records  without  audit.  The  accompanying
consolidated  financial  statements  have been prepared in  accordance  with the
instructions  to Form 10-Q and Rule 10-01 of  Regulation  S-X and do not include
all of the  information  and the  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  adjustments,  necessary  for a fair  presentation  of such  financial
statements,  have been  included.  The  results of  operations  for the  interim
periods are not  necessarily  indicative  of the results to be expected  for the
full year.

For further  information,  refer to the  consolidated  financial  statements and
footnotes  thereto  included in the Company's Annual Report on Form 10-K for the
year ended December 31, 2001.

2.   RECLASSIFICATIONS

Certain   reclassifications   have  been  made  to  the  consolidated  financial
statements of prior periods to conform to the current period presentation.  Such
reclassifications have no effect on previously reported net income.

<PAGE>


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

FORWARD-LOOKING STATEMENTS

This report contains  forward-looking  statements  under the Private  Securities
Litigation Reform Act of 1995 that involve risks and uncertainties. Although the
Company believes that the assumptions underlying the forward-looking  statements
contained herein are reasonable, any of the assumptions could be inaccurate, and
therefore,  there  can  be no  assurance  that  the  forward-looking  statements
included  herein will prove to be  accurate.  Factors  that could  cause  actual
results to differ from the results discussed in the  forward-looking  statements
include,  but are not limited to: economic  conditions  (both generally and more
specifically in the markets in which the Company and its subsidiaries  operate);
competition  for the  Company's  customers  from other  providers  of  financial
services; government legislation and regulation (which changes from time to time
and over which the Company has no control);  changes in interest rates; material
unforeseen  changes  in the  liquidity,  results  of  operations,  or  financial
condition of the Company's customers;  and other risks detailed in the Company's
filings with the Securities and Exchange Commission,  all of which are difficult
to predict and many of which are beyond the control of the Company.

RESULTS OF OPERATIONS

                   SECOND QUARTER 2002 VS. SECOND QUARTER 2001
                   -------------------------------------------

The Company  reported  net income of $3.3  million or $.48 per basic and diluted
share for the second  quarter of 2002  compared to net income of $3.9 million or
$.56 per basic and diluted share for the second quarter of 2001. This represents
a decrease of 14.3% on a per share basis.  Net  interest  income for the current
quarter totaled $9.9 million,  a decrease of $881 thousand or 8.1%.  Noninterest
income  increased  $208 thousand or 5.3%.  Noninterest  expense  increased  $357
thousand or 4.3%.

Return on average assets ("ROA") was 1.10% for the current  quarter,  a decrease
of 29 basis points  compared to 1.39%  reported for the same period in 2001. The
29 basis point  decrease  in ROA was  attributed  to a decrease in net  interest
margin of 47 basis points to 3.94%.  The lower net interest margin was partially
offset by a decrease in  noninterest  expense  relative to average  assets of 10
basis points and a decrease in income tax expense  relative to average assets of
14 basis points.  Return on average  equity was 10.71% for the second quarter of
2002 compared to 12.95% in the same period of 2001.

NET INTEREST INCOME
-------------------

The interest  rate  environment  has been  extremely  volatile in the  quarterly
comparison,  as general market interest rates have dropped  significantly  since
the second  quarter of 2001.  Actions  taken by the Federal  Reserve  Board (the
"Fed") to reduce short-term  interest rates by 200 basis points since the end of
the second quarter of 2001 have affected the Company's net interest  margin,  as
well as the net interest margin of many financial  institutions in the industry.
The effect of the Fed's  actions on the  Company has  generally  led to interest
rates on earning  assets  declining  more  rapidly  than rates paid on  interest
bearing  liabilities.  During a falling rate  environment,  the  challenge is to
reduce the rates paid on interest bearing  liabilities  (primarily  deposits) to
offset the decline in the yield on variable rate assets  (primarily loans) while
remaining  competitive  in our markets.  The Company's  tax-equivalent  yield on
earning  assets for the current three months was 6.43%, a reduction of 141 basis
points from the same period a year ago. The cost of funds for the current  three
months was 2.88%,  a decline of 131 basis  points  compared to the same period a
year ago. A goal of the Company in the current  interest rate  environment is to
increase earning assets and decrease the interest rates paid on interest bearing
liabilities while remaining  competitive in our markets.  Average earning assets
increased  $43.3  million or 4.2% in the  quarterly  comparison.  However,  as a
percentage of total average  assets,  earning  assets  declined 299 basis points
from 91.37% to 88.38%.  Average  interest  paying  liabilities  increased  $84.0
million or 10.0% in the comparison.

Interest income totaled $16.6 million for the second quarter of 2002, a decrease
of $3.0 million or 15.4% compared to the same period in the prior year. Interest
expense totaled $6.6 million,  a decrease of $2.1 million or 24.4%. Net interest
income before  provision  for loan losses  declined $881 thousand or 8.1% in the
comparison and totaled $9.9 million at June 30, 2002.

Interest and fees on loans  decreased  $2.7 million  mainly due to a decrease in
the average rate earned.  Average loans  decreased $5.2 million or 0.75%,  while
the yield  decreased 148 basis points to 7.41%.  Interest on taxable  securities
increased  $76  thousand  or 3.0%  due  primarily  to a $55.8  million  or 31.8%
increase in the average  balance.  The increase in the average  balance offset a
126 basis  point  decline in the average  rate  earned.  Interest on  nontaxable
securities  increased  $109  thousand or 13.1% due to an increase in the average
balance of $9.6 million  combined with a 20 basis point  increase in the average
rate  earned  of 6.68%.  Interest  on  short-term  investments,  including  time
deposits in other banks,  federal funds sold,  and  securities  purchased  under
agreements to resell, decreased $530 thousand due primarily to a 214 basis point
decrease in the average rate earned on these investments as well as a decline in
the average balance of $16.9 million or 21.0%.

Interest  expense on deposits  decreased  $1.9 million or 24.7% to $5.8 million.
This  decrease  resulted  from a  general  decline  in  the  average  rate  paid
throughout the deposit  portfolio,  which offset increases in average  balances.
The decline in interest  expense on deposits was as follows:  time deposits $1.1
million or 19.1%;  interest  bearing demand deposits $327 thousand or 38.5%; and
savings deposits $467 thousand or 43.9%. The average rate paid on time deposits,
the largest  component of interest bearing  deposits,  was 4.62% for the current
quarter  compared to 5.96% for the same period of 2001.  The average  balance of
time deposits  increased  $16.6 million or 4.3% to $403.3  million.  The average
rate paid on interest bearing demand deposits  declined 78 basis points to 0.98%
while the average  balance  increased  $20.0 million or 10.3% to $214.1 million.
The average rate paid on savings  deposits  decreased  124 basis points to 1.45%
while the average  balance  increased  $7.2  million or 4.5% to $165.9  million.
Interest expense on federal funds purchased and securities sold under agreements
to  repurchase  decreased  $537  thousand  due  primarily  to a 242 basis  point
decrease in the average rate paid. The significant  decrease in the average rate
paid offset a $2.5  million or 2.7%  increase in the average  balance.  Interest
expense on other  borrowed  funds  increased  $287 thousand in the comparison as
additional  borrowings  from the Federal  Home Loan Bank  increased  the average
balance outstanding.  The average rate paid on other borrowed funds declined 285
basis points to 3.64%.

The net interest  margin on a tax equivalent  basis decreased 47 basis points to
3.94% during the second  quarter of 2002 compared to 4.41% in the second quarter
of 2001.  The decrease in net interest  margin is primarily  attributed  to a 37
basis point decline in the impact of noninterest  bearing sources of funds.  The
effect of noninterest  bearing sources of funds on net interest margin typically
declines in a falling rate  environment.  Also  contributing to the reduction in
net  interest  margin is a 10 basis point  decline in the spread  between  rates
earned and paid that totaled 3.55% for the current quarter  compared to 3.65% in
the same quarter a year earlier.

<PAGE>
The  following  tables  present  an  analysis  of net  interest  income  for the
quarterly periods ended June 30.

<TABLE>
<CAPTION>

DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY:  INTEREST RATES AND INTEREST DIFFERENTIAL
------------------------------------------------------------------------------------------------------------------------------
Quarter Ended June 30,                                          2002                                       2001
------------------------------------------------------------------------------------------------------------------------------
                                             Average                        Average        Average                   Average
(In thousands)                               Balance         Interest         Rate         Balance      Interest       Rate
------------------------------------------------------------------------------------------------------------------------------
<S>                                      <C>                 <C>              <C>      <C>              <C>            <C>
EARNING ASSETS
Investment securities
  Taxable                                $   231,433         $ 2,601          4.51%    $   175,635      $ 2,525        5.77%
  Nontaxable1                                 82,347           1,372          6.68          72,784        1,175        6.48
Time deposits with banks, federal
  funds sold and securities purchased
  under agreements to resell                  63,383             377          2.39          80,251          907        4.53
Loans1,2,3                                   691,429          12,775          7.41         696,656       15,437        8.89
------------------------------------------------------------------------------------------------------------------------------
     Total earning assets                  1,068,592         $17,125          6.43%      1,025,326      $20,044        7.84%
------------------------------------------------------------------------------------------------------------------------------
Allowance for loan losses                    (10,393)                                      (10,531)
------------------------------------------------------------------------------------------------------------------------------
     Total earning assets, net of
     allowance for loan losses             1,058,199                                     1,014,795
------------------------------------------------------------------------------------------------------------------------------
NONEARNING ASSETS
Cash and due from banks                      112,936                                        67,404
Premises and equipment, net                   24,312                                        25,133
Other assets                                  13,602                                        14,853
------------------------------------------------------------------------------------------------------------------------------
     Total assets                        $ 1,209,049                                   $ 1,122,185
------------------------------------------------------------------------------------------------------------------------------
INTEREST BEARING LIABILITIES
Deposits
  Interest bearing demand                $   214,116         $   523          0.98%    $   194,160      $   850        1.76%
  Savings                                    165,918             598          1.45         158,745        1,065        2.69
  Time                                       403,276           4,650          4.62         386,641        5,746        5.96
Federal funds purchased and
  securities sold under agreements
  to repurchase                               93,539             434          1.86          91,064          971        4.28
Other borrowed funds                          45,576             414          3.64           7,843          127        6.49
------------------------------------------------------------------------------------------------------------------------------
     Total interest bearing liabilities      922,425         $ 6,619          2.88%        838,453      $ 8,759        4.19%
------------------------------------------------------------------------------------------------------------------------------
NONINTEREST BEARING LIABILITIES
Commonwealth of Kentucky deposits             39,927                                        37,743
Other demand deposits                        114,413                                       116,057
Other liabilities                              8,095                                         9,283
------------------------------------------------------------------------------------------------------------------------------
     Total liabilities                      1,084,860                                    1,001,536
------------------------------------------------------------------------------------------------------------------------------
     Shareholders' equity                     124,189                                      120,649
------------------------------------------------------------------------------------------------------------------------------
     Total liabilities and shareholders'
     equity                               $ 1,209,049                                  $ 1,122,185
------------------------------------------------------------------------------------------------------------------------------
Net interest income                                            10,506                                    11,285
TE basis adjustment                                              (570)                                     (468)
------------------------------------------------------------------------------------------------------------------------------
     Net interest income                                      $ 9,936                                   $10,817
------------------------------------------------------------------------------------------------------------------------------
Net interest spread                                                           3.55%                                    3.65%
Impact of noninterest bearing sources
  of funds                                                                     .39                                      .76
------------------------------------------------------------------------------------------------------------------------------
Net interest margin                                                           3.94%                                    4.41%
------------------------------------------------------------------------------------------------------------------------------

1Income and yield stated at a fully tax equivalent basis using a 35% tax rate.
2Loan balances include principal balances on nonaccrual loans.
3Loan fees included in interest income amount to $476 thousand and $495 thousand in 2002 and 2001, respectively.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>

ANALYSIS OF CHANGES IN NET INTEREST INCOME (TAX EQUIVALENT BASIS)
------------------------------------------------------------------------------------------------------------------------------
(In thousands)                                                          Variance         Variance Attributed to
Quarter ended June 30,                                                 2002/20011         Volume          Rate
------------------------------------------------------------------------------------------------------------------------------
<S>                                                                      <C>            <C>           <C>
INTEREST INCOME
Taxable investment securities                                            $   76         $ 2,668       $ (2,592)
Nontaxable investment securities2                                           197             159             38
Time deposits with banks, federal funds sold and
   securities purchased under agreements to resell                         (530)           (163)          (367)
Loans2                                                                   (2,662)           (115)        (2,547)
------------------------------------------------------------------------------------------------------------------------------
     Total interest income                                               (2,919)          2,549         (5,468)
------------------------------------------------------------------------------------------------------------------------------
INTEREST EXPENSE
Interest bearing demand deposits                                           (327)            508           (835)
Savings deposits                                                           (467)            310           (777)
Time deposits                                                            (1,096)          1,488         (2,584)
Federal funds purchased and securities sold under
   agreements to repurchase                                                (537)            178           (715)
Other borrowed funds                                                        287             673           (386)
------------------------------------------------------------------------------------------------------------------------------
     Total interest expense                                              (2,140)          3,157         (5,297)
------------------------------------------------------------------------------------------------------------------------------
Net interest income                                                      $ (779)         $ (608)       $  (171)
------------------------------------------------------------------------------------------------------------------------------
Percentage change                                                         100.0%           78.0%          22.0%
------------------------------------------------------------------------------------------------------------------------------

1The changes that are not solely due to rate or volume are allocated on a percentage basis using the absolute values of rate and
 volume variances as a basis for allocation.
2Income stated at fully tax equivalent basis using a 35% tax rate.
</TABLE>


NONINTEREST INCOME
------------------

Noninterest income totaled $4.1 million for the current quarter,  an increase of
$208  thousand or 5.3% compared to the prior year.  Service  charges and fees on
deposits,  the largest component of noninterest income,  increased $213 thousand
or 12.2% primarily due to the new overdraft policy and related NSF fee structure
that is now  fully in place at each of the  Company's  subsidiary  banks.  Other
service  charges,  commissions,  and fees  decreased  $62  thousand  or 6.4% due
primarily to a $37 thousand or 33.0% decrease in fee income on loans  originated
for sale to unrelated third parties. Trust fees decreased $146 thousand or 28.8%
due primarily to unusually large estate fees collected  during the same period a
year earlier. Net gains on the sale of available for sale investment  securities
totaled $396 thousand, an increase of $210 thousand.

NONINTEREST EXPENSE
-------------------

Total  noninterest  expense  increased  $357  thousand  or 4.3% from the  second
quarter of 2001 and totaled $8.7 million.  Salaries and employee  benefits,  the
largest  component of  noninterest  expense,  increased  $236  thousand or 5.2%.
Employee  benefits  increased  $249 thousand in the quarterly  comparison  while
salaries and related payroll taxes increased $77 thousand.  Noncash compensation
expense  attributed  to stock option grants  decreased  $90 thousand.  Occupancy
expense,  net of rental  income,  decreased $21 thousand in the  comparison  and
totaled $588 thousand.  Equipment expense totaled $914 thousand,  an increase of
$140  thousand or 18.1%.  The  increase  is  primarily  the result of  increased
depreciation.  Bank  franchise  tax  increased  3.0%  to  $306  thousand.  Other
noninterest expense decreased less than 1% and totaled $2.1 million.

INCOME TAXES
------------

Income tax expense for the second  quarter of 2002 was $1.1 million,  a decrease
of $388  thousand or 26.4% from the second  quarter of 2001.  The  effective tax
rate was 24.6% for the current quarter,  a decrease of 280 basis points from the
second  quarter of 2001.  The  decrease  in the  effective  tax rate is due to a
combination  of  factors,   including  the  following:   tax-exempt   investment
securities  averaged $82.3 million,  an increase of $9.6 million or 13.1% in the
quarterly  comparison;  tax-exempt  municipal  loans averaged $19.6 million,  an
increase of $7.0  million or 55.8%;  and taxable  earning  assets  repriced to a
lower  interest  rate at a faster  pace than  tax-exempt  earning  assets in the
rapidly declining  interest rate environment.  The result is less taxable income
in proportion to total income.

                            FIRST SIX MONTHS OF 2002
                            ------------------------

Net income for the six months ended June 30, 2002 was $7.1  million  compared to
net income of $7.8  million  for the same  period in 2001,  a  decrease  of $704
thousand or 9.0%.  On a basic and diluted per share  basis,  net income  totaled
$1.03 and $1.02 for the current six-month period, a decrease of $.08 or 7.2% and
$.09 or 8.1%,  respectively.  The  decrease in net income is due  primarily to a
decline in net interest  income.  Net interest income  decreased $1.4 million or
6.3% in the six-month comparison.

ROA was 1.19% for the six months  ended June 30,  2002,  a decrease  of 23 basis
points  from the same  period in 2001.  The 23 basis  point  decrease in ROA was
attributed to a decrease in net interest margin of 46 basis points to 3.97%. The
lower net  interest  margin was  partially  offset by a decrease in  noninterest
expense  relative to average  assets of 9 basis  points and a decrease in income
tax expense  relative to average  assets of 12 basis  points.  Return on average
equity was 11.53%,  a decrease of 133 basis  points from the first six months of
2001.

NET INTEREST INCOME
-------------------

The interest  rate  environment  has been  extremely  volatile in the  six-month
comparison,  as general market interest rates have dropped  significantly  since
the  second  quarter  of 2001.  Actions  taken by the Fed to  reduce  short-term
interest  rates by 200 basis points since the end of the second  quarter of 2001
have  affected the Company's  net interest  margin,  as well as the net interest
margin of many financial  institutions in the industry.  The effect of the Fed's
actions on the Company has  generally  led to interest  rates on earning  assets
declining more rapidly than rates paid on interest bearing liabilities. During a
falling rate environment,  the challenge is to reduce the rates paid on interest
bearing liabilities  (primarily  deposits) to offset the decline in the yield on
variable  rate assets  (primarily  loans)  while  remaining  competitive  in our
markets.  The Company's  tax-equivalent  yield on earning assets for the current
six months was 6.47%,  a  reduction  of 156 basis  points from the same period a
year ago.  The cost of funds for the current six months was 2.93%,  a decline of
148 basis  points  compared to the same period a year ago. A goal of the Company
in the current  interest  rate  environment  is to increase  earning  assets and
decrease the interest rates paid on interest bearing liabilities while remaining
competitive in our markets.  Average  earning assets  increased $60.2 million or
5.9% in the  comparison.  However,  as a  percentage  of total  average  assets,
earning assets declined 208 basis points from 91.71% to 89.63%. Average interest
paying liabilities increased $91.0 million or 11.0% in the comparison.

Interest  income totaled $33.5 million for the six months ended June 30, 2002, a
decrease of $6.1 million or 15.4% compared to the same period in 2001.  Interest
expense was $13.4  million,  a decrease of $4.8  million or 26.2%.  Net interest
income declined $1.4 million or 6.3%

Interest and fees on loans  decreased  $5.0 million or 16.3%  primarily due to a
145 basis point  decline in the average  rate earned of 7.59% in the current six
months.  Average loans  outstanding  were  virtually  unchanged at $690 million.
Interest  on  taxable  securities  increased  $178  thousand  or 3.4% as a $74.1
million increase in the average balance outstanding offset a decline in yield of
168 basis points.  Interest on nontaxable  securities increased $222 thousand or
13.6% due to an increase  in both the  average  balance and rate earned of $10.5
million  or 14.7% and 16 basis  points,  respectively.  Interest  on  short-term
investments,  including  time deposits in other banks,  federal funds sold,  and
securities purchased under agreements to resell, decreased $1.5 million or 71.4%
due primarily to a 303 basis point decrease in the average rate earned.  A $24.3
million decrease in the average balance also contributed to the decrease.

Interest  expense on deposits  declined $3.9 million or 25.0% to $11.8  million.
This  decrease  resulted  from a  general  decline  in  the  average  rate  paid
throughout the deposit  portfolio,  which offset increases in average  balances.
The decline in interest  expense on deposits was as follows:  time deposits $1.9
million or 16.9%;  interest  bearing demand deposits $834 thousand or 43.5%; and
savings  deposits $1.2 million or 48.7%. The average rate paid on time deposits,
the largest  component of interest bearing  deposits,  was 4.75% for the current
six months compared to 6.02% for the same period of 2001. The average balance of
time deposits  increased  $20.2 million or 5.3% to $401.6  million.  The average
rate paid on interest bearing demand deposits  declined 97 basis points to 1.01%
while the average  balance  increased  $20.0 million or 10.3% to $215.3 million.
The average rate paid on savings  deposits  decreased  153 basis points to 1.49%
while the average  balance  increased  $6.8  million or 4.3% to $164.3  million.
Interest expense on federal funds purchased and securities sold under agreements
to repurchase decreased $1.3 million or 59.3% due primarily to a 324 basis point
decrease in the average rate paid. The significant  decrease in the average rate
paid offset a $12.0 million or 13.5% increase in the average  balance.  Interest
expense on other  borrowed  funds  increased  $474 thousand in the comparison as
additional  borrowings  from the Federal  Home Loan Bank  increased  the average
balance  outstanding.  The increase in the average balance  outstanding offset a
287 basis point decline in the average rate paid.

The net interest  margin on a tax equivalent  basis decreased 46 basis points to
3.97%  during the first six months of 2002  compared to the same period of 2001.
The decrease in net interest margin is primarily  attributed to a 38 basis point
decline in the impact of  noninterest  bearing  sources of funds.  The effect of
noninterest  bearing sources of funds on net interest margin typically  declines
in a  falling  rate  environment.  Also  contributing  to the  reduction  in net
interest  margin is an 8 basis point decline in the spread  between rates earned
and paid that totaled 3.54% for the current six months  compared to 3.62% in the
same period a year earlier.

<PAGE>

The  following  tables  present an analysis of net  interest  income for the six
months ended June 30.

<TABLE>
<CAPTION>

DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY:  INTEREST RATES AND INTEREST DIFFERENTIAL
----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended June 30,                                         2002                                       2001
----------------------------------------------------------------------------------------------------------------------------------
                                                 Average                      Average       Average                       Average
(In thousands)                                   Balance         Interest       Rate        Balance        Interest         Rate
----------------------------------------------------------------------------------------------------------------------------------
<S>                                          <C>                <C>            <C>      <C>                <C>             <C>
EARNING ASSETS
Investment securities
  Taxable                                    $   246,098        $  5,343       4.38%    $   171,957        $ 5,165         6.06%
  Nontaxable1                                     81,876           2,699       6.65          71,379          2,298         6.49
Time deposits with banks, federal
  funds sold and securities purchased
  under agreements to resell                      60,279             608       2.03          84,614          2,122         5.06
Loans1,2,3                                       690,242          25,968       7.59         690,379         30,948         9.04
----------------------------------------------------------------------------------------------------------------------------------
     Total earning assets                      1,078,495        $ 34,618       6.47%      1,018,329       $ 40,533         8.03%
----------------------------------------------------------------------------------------------------------------------------------
Allowance for loan losses                        (10,476)                                   (10,469)
----------------------------------------------------------------------------------------------------------------------------------
     Total earning assets, net of
     allowance for loan losses                1,068,019                                   1,007,860
----------------------------------------------------------------------------------------------------------------------------------
NONEARNING ASSETS
Cash and due from banks                           99,222                                     65,055
Premises and equipment, net                       24,502                                     25,088
Other assets                                      11,511                                     12,433
----------------------------------------------------------------------------------------------------------------------------------
     Total assets                            $ 1,203,254                                $ 1,110,436
----------------------------------------------------------------------------------------------------------------------------------
INTEREST BEARING LIABILITIES
Deposits
  Interest bearing demand                      $ 215,265        $  1,082       1.01%      $ 195,240        $ 1,916         1.98%
  Savings                                        164,324           1,211       1.49         157,489          2,361         3.02
  Time                                           401,646           9,459       4.75         381,439         11,385         6.02
Federal funds purchased and
  securities sold under agreements
  to repurchase                                  101,037             907       1.81          89,012          2,227         5.05
Other borrowed funds                              40,432             753       3.76           8,482            279         6.63
----------------------------------------------------------------------------------------------------------------------------------
     Total interest bearing liabilities          922,704        $ 13,412       2.93%        831,662       $ 18,168         4.41%
----------------------------------------------------------------------------------------------------------------------------------
NONINTEREST BEARING LIABILITIES
Commonwealth of Kentucky deposits                 35,146                                     35,185
Other demand deposits                            114,910                                    114,490
Other liabilities                                  6,355                                      6,776
----------------------------------------------------------------------------------------------------------------------------------
     Total liabilities                         1,079,115                                    988,113
----------------------------------------------------------------------------------------------------------------------------------
     Shareholders' equity                        124,139                                    122,323
----------------------------------------------------------------------------------------------------------------------------------
     Total liabilities and shareholders'
     equity                                  $ 1,203,254                                $ 1,110,436
----------------------------------------------------------------------------------------------------------------------------------
Net interest income                                               21,206                                    22,365
TE basis adjustment                                               (1,115)                                     (912)
----------------------------------------------------------------------------------------------------------------------------------
     Net interest income                                        $ 20,091                                  $ 21,453
----------------------------------------------------------------------------------------------------------------------------------
Net interest spread                                                            3.54%                                       3.62%
Impact of noninterest bearing sources
   of funds                                                                     .43                                         .81
----------------------------------------------------------------------------------------------------------------------------------
Net interest margin                                                            3.97%                                       4.43%
----------------------------------------------------------------------------------------------------------------------------------

1Income and yield stated at a fully tax equivalent basis using a 35% tax rate.
2Loan balances include principal balances on nonaccrual loans.
3Loan fees included in interest income amount to $906 thousand and $921 thousand in 2002 and 2001, respectively.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>

ANALYSIS OF CHANGES IN NET INTEREST INCOME (TAX EQUIVALENT BASIS)
----------------------------------------------------------------------------------------------------------------------------------
(In thousands)                                                          Variance        Variance Attributed to
Six Months Ended June 30,                                              2002/20011        Volume          Rate
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                                     <C>            <C>           <C>
INTEREST INCOME
Taxable investment securities                                           $   178        $ 3,625       $ (3,447)
Nontaxable investment securities2                                           401            343             58
Time deposits with banks, federal funds sold and
   securities purchased under agreements to resell                       (1,514)          (491)        (1,023)
Loans2                                                                   (4,980)            (6)        (4,974)
----------------------------------------------------------------------------------------------------------------------------------
     Total interest income                                               (5,915)         3,471         (9,386)
----------------------------------------------------------------------------------------------------------------------------------
INTEREST EXPENSE
Interest bearing demand deposits                                           (834)           511         (1,345)
Savings deposits                                                         (1,150)           289         (1,439)
Time deposits                                                            (1,926)         1,558         (3,484)
Federal funds purchased and securities sold under
   agreements to repurchase                                              (1,320)           773         (2,093)
Other borrowed funds                                                        474            861           (387)
----------------------------------------------------------------------------------------------------------------------------------
     Total interest expense                                              (4,756)         3,992         (8,748)
----------------------------------------------------------------------------------------------------------------------------------
Net interest income                                                    $ (1,159)        $ (521)       $  (638)
----------------------------------------------------------------------------------------------------------------------------------
Percentage change                                                         100.0%          45.0%          55.0%
----------------------------------------------------------------------------------------------------------------------------------

1The changes that are not solely due to rate or volume are allocated on a percentage basis using the absolute values of rate and
 volume variances as a basis for allocation.
2Income stated at fully tax equivalent basis using a 35% tax rate.
</TABLE>


NONINTEREST INCOME
------------------

Noninterest  income  was $8.3  million  for the  first six  months  of 2002,  an
increase of $757 thousand or 10.1% compared to the same period in 2001.  Service
charges and fees on  deposits,  the largest  component  of  noninterest  income,
increased $478 thousand or 14.5%  primarily due to the new overdraft  policy and
related NSF fee  structure  that is now fully in place at each of the  Company's
subsidiary  banks.  Other service charges,  commissions,  and fees decreased $90
thousand  or 4.8% to $1.8  million  primarily  due to a  decrease  in  custodial
safekeeping  fees from the  Commonwealth of Kentucky.  Trust fees decreased $165
thousand or 18.5% due primarily to unusually large estate fees collected  during
the same period in 2001. Net gains on the sale of available for sale  investment
securities  totaled  $993  thousand in the current  period,  an increase of $528
thousand compared to a year earlier.

NONINTEREST EXPENSE
-------------------

Total  noninterest  expense  increased  $846  thousand or 5.0% and totaled $17.7
million for the first six months of 2002.  Salaries and employee  benefits,  the
largest component of noninterest expense, increased $452 thousand or 4.8% in the
six-month   comparison.   Employee  benefits  increased  $351  thousand  in  the
comparison  while  salaries and related  payroll taxes  increased $269 thousand.
Noncash  compensation  expense  attributed to stock option grants decreased $168
thousand.  Occupancy  expense,  net of rental income,  decreased $34 thousand or
2.8% in the  comparison.  Equipment  expense  increased  $259  thousand or 16.4%
primarily due to an increase in depreciation expense. Bank franchise tax expense
and other  noninterest  expense increased $169 thousand or 3.7% to $4.8 million.
The increase in other  noninterest  expense is primarily  attributable to a $146
thousand increase in losses on foreclosed assets.

INCOME TAXES
------------

Income tax expense for the first six months of 2002 was $2.4 million, a decrease
of $583 thousand or 19.4% compared to the same period in 2001. The effective tax
rate was 25.4% for the first six months of 2002,  a decrease of 240 basis points
from  the  prior  year.  The  decrease  in the  effective  tax  rate is due to a
combination  of  factors,   including  the  following:   tax-exempt   investment
securities  averaged $81.9 million, an increase of $10.5 million or 14.7% in the
comparison;  tax-exempt  municipal loans averaged $18.3 million,  an increase of
$6.4 million or 53.3%;  and taxable  earning assets repriced to a lower interest
rate at a faster pace than  tax-exempt  earning assets in the rapidly  declining
interest rate  environment.  The result is less taxable  income in proportion to
total income.

FINANCIAL CONDITION

Total assets were $1.3 billion on June 30, 2002, an increase of $82.6 million or
7.0% from December 31, 2001. Fluctuations in assets and deposits are typical due
to the relationship between the Company's principal  subsidiary,  Farmers Bank &
Capital Trust Company and the  Commonwealth  of Kentucky.  Farmers Bank provides
various  services to state agencies of the  Commonwealth.  As the depository for
the Commonwealth,  these agencies issue checks drawn on Farmers Bank,  including
paychecks and state income tax refunds.  Farmers Bank also processes vouchers of
the WIC  (Women,  Infants  and  Children)  program  for the  Cabinet  for  Human
Resources.  The Bank's investment  department provides services to the Teacher's
Retirement systems.  As the depository for the Commonwealth,  large fluctuations
in deposits are likely to occur on a daily  basis.  On an average  basis,  total
assets were $1.2 billion for the first six months of 2002,  an increase of $59.6
million or 5.2% from year-end 2001. Average earning assets were 89.6% of average
total  assets at June 30,  2002,  a decrease  of 172 basis  points  compared  to
year-end 2001

LOANS
-----

Loans,  net of unearned  income,  totaled  $695.2  million at June 30,  2002,  a
decrease of $6.6 million or 0.9% from  year-end  2001.  This  reduction in loans
outstanding  is primarily the result of decreases in commercial  and  industrial
loans of $7.5 million or 9.7% and lease financing of $2.5 million or 6.1%. Loans
to states and political subdivision increased $4.1 million or 27.9%. Average net
loans for the  six-month  period  ended June 30,  2002 were  $690.2  million,  a
decrease of $8.5  million or 1.2%  compared to the  year-end  2001  average.  On
average,  loans  represented  64.0% of earning  assets during the current period
compared to 66.9% for year-end  2001. As loan demand  fluctuates,  the available
funds  are  redirected  between  either  temporary   investments  or  investment
securities.

ALLOWANCE FOR LOAN LOSSES
-------------------------

The allowance for loan losses was $11.0 million at June 30, 2002, an increase of
$477 thousand or 4.5% from the prior year-end. The allowance for loan losses was
1.59% of net loans at June 30, 2002,  an increase of nine basis points  compared
to December 31, 2001. The increase in the allowance for loan losses is primarily
attributed to the  significant  increase in  nonperforming  loans,  as discussed
below,  and the related  estimated  credit risk  within the loan  portfolio.  In
management's  opinion, the allowance for loan losses is adequate to cover losses
inherent in the loan  portfolio.  The  provision  for loan losses  decreased $62
thousand and $164 thousand in the current three and six-month  periods  compared
to the same periods in 2001.  The Company had net  charge-offs  of $291 thousand
and $632 thousand in the current three and six month periods of 2002 compared to
net  charge-offs  of $946 thousand and $1.0 million in the same periods of 2001.
Annualized net charge-offs  represented 0.17% and 0.18% of average net loans for
the current  three and  six-month  periods,  respectively,  compared to 0.31% at
year-end  2001.   Management  continues  to  emphasize  collection  efforts  and
evaluation of risks within the loan portfolio.

NONPERFORMING ASSETS
--------------------

Nonperforming  assets for the Company include  nonperforming  loans,  other real
estate owned,  and other  foreclosed  assets.  Nonperforming  loans  consists of
nonaccrual loans,  restructured loans, and loans past due ninety days or more on
which interest is still accruing.  Nonperforming assets totaled $21.1 million at
June  30,  2002,  an  increase  of  $14.8  million  from  the  prior   year-end.
Nonperforming  loans totaled $20.7 million at June 30, 2002 an increase of $15.5
million  compared to year-end 2001.  Nonperforming  loans as a percentage of net
loans  were 2.97% at June 30,  2002  compared  to 0.74% at  year-end  2001.  The
increase in nonperforming  loans is primarily due to a $14.5 million increase in
loans on nonaccrual status that totaled $18.1 million at June 30, 2002. Loans on
nonaccrual  status  include  $15.3  million of  constructions  loans  secured by
residential  real  estate to a  financially  troubled  builder.  The Company has
performed a detailed review of this credit and, under the information  currently
known by management,  believes no further  provisions for loan losses related to
this credit are  necessary.  Interest  income lost on this group of loans due to
their  nonaccrual  status totaled $302 thousand during the six months ended June
30, 2002. A portion of this total,  $92  thousand,  represents  interest  income
accrued  during  the  first  quarter  of 2002,  before  the loan was  placed  on
nonaccrual  status,  which was  reversed  in the second  quarter of 2002.  It is
currently  estimated that a total of $210 thousand of interest income in each of
the  remaining  quarters of 2002 will be lost  related to this credit  should it
remain on nonaccrual status through year-end 2002.

Other real estate owned,  which had a balance of $715 thousand at year-end 2001,
decreased $391 thousand or 54.7% and totaled $324 thousand on June 30, 2002.

TEMPORARY INVESTMENTS
---------------------

Temporary  investments  consist of interest  bearing  deposits with other banks,
federal funds sold,  and  securities  purchased  under  agreements to resell and
totaled  $128.4  million at June 30,  2002,  an increase of $78.0  million  from
year-end 2001.  Temporary  investments  averaged $60.3 million for the first six
months of 2002, a decrease of $22.5 million from year-end 2001. This decrease is
primarily a result of the  Company's net funding  position and the  relationship
between its principal  subsidiary and the  Commonwealth of Kentucky as described
in preceding sections of this report.  Temporary  investments are reallocated as
loan demand and other investment alternatives present the opportunity.

INVESTMENT SECURITIES
---------------------

Investment  securities were $299.1 million on June 30, 2002, a decrease of $46.4
million or 13.4% from  year-end  2001.  Available  for sale and held to maturity
securities  were $266.7  million  and $32.4  million,  respectively.  Investment
securities averaged $328.0 million for the first six months of 2002, an increase
of $64.8 million or 24.6% from year-end 2001. The increase in average investment
securities is attributable to the Company's  continued efforts to manage its net
interest  margin during a period of  relatively  low market  interest  rates and
correlates  with the increase in borrowed  funds.  The Company had an unrealized
gain on available  for sale  investment  securities  of $2.1 million at June 30,
2002 compared to $1.9 million at year-end 2001.

DEPOSITS
--------

Total  deposits  were  $940.7  million at June 30,  2002,  an  increase of $27.3
million or 3.0% from year-end 2001. Noninterest bearing deposits increased $30.2
million  or 22.2% in the  comparison.  This  increase  is  primarily  due to the
relationship  between the Company's principal subsidiary and the Commonwealth of
Kentucky as  described in preceding  sections of this  report.  Commonwealth  of
Kentucky deposits  increased $27.9 million on June 30, 2002 compared to December
31, 2001. On average,  noninterest  bearing  deposits were $150.1 million during
the current period,  an increase of $1.3 million or 0.9%. End of period interest
bearing  deposit  balances  decreased $2.9 million or 0.4% compared to the prior
year end and are  summarized  as follows:  interest  bearing  checking  accounts
decreased  $2.7  million  to  $209.9  million;  money  market  deposit  accounts
decreased $4.1 million to $99.8 million; savings accounts decreased $7.5 million
to $58.9 million;  and time deposits  increased $11.4 million to $406.0 million.
On  average,  interest  bearing  deposits  were  $781.2  million in the  current
six-month  period, an increase of $33.9 million from year-end 2001. The increase
in average  interest  bearing  deposits is attributable to increases in interest
bearing demand deposits of $16.2 million or 8.1%, time deposits of $16.0 million
or 4.2%,  and money market  deposit  accounts of $3.3  million or 3.3%.  Average
savings deposits  decreased $1.7 million or 2.8%. Total deposits averaged $931.3
million, an increase of $35.2 million or 3.9% from year-end 2001.

BORROWED FUNDS
--------------

Borrowed  funds  totaled  $191.3  million at June 30, 2002, an increase of $53.8
million or 39.1% from year-end 2001. Increases in short-term borrowings of $38.4
million along with an increase in long-term  borrowings of $15.4 million account
for the total increase in borrowed funds. Federal funds purchased and securities
sold under  agreements  to  repurchase  accounted  for most of the  increase  in
borrowed funds with an increase of $31.7 million or 27.8%.  This increase is due
primarily  to  the  overall  funding  needs  of  the  Company  as  well  as  the
relationship  between the Company's principal subsidiary and the Commonwealth of
Kentucky as  described in preceding  sections of this report.  Other  short-term
borrowings  increased  $6.7 million  mainly due to an increase in borrowed funds
from the  Federal  Home  Loan  Bank  ("FHLB").  The $15.4  million  increase  in
long-term  borrowings is  attributed  to additional  advances from the FHLB with
varying  interest rate terms and maturing within 10 years.  Recent FHLB advances
have been used to fund the purchase of additional  investment  securities and to
aid the efforts of asset and liability management. Total borrowed funds averaged
$141.5 million, an increase of $24.5 million or 20.9% from year-end 2001.

LIQUIDITY

The Parent  Company's  primary use of cash consists of dividend  payments to its
common shareholders,  purchases of its common stock, and other general operating
purposes.  Liquidity of the Parent Company  depends  primarily on the receipt of
dividends from its subsidiary banks and cash balances maintained. As of June 30,
2002 combined retained  earnings of the subsidiary banks were $69.1 million,  of
which $17.3  million was  available  for the payment of  dividends to the Parent
Company without  obtaining prior approval from bank  regulatory  agencies.  As a
practical matter, payment of future dividends is also subject to the maintenance
of other capital ratio  requirements.  Management expects that in the aggregate,
its subsidiary banks will continue to have the ability to pay dividends in order
to provide funds to the Parent Company  during the remainder of 2002  sufficient
to meet its  liquidity  needs.  The Parent  Company  had cash  balances  of $8.3
million at June 30, 2002.

The Company's  objective as it relates to liquidity is to insure that subsidiary
banks  have funds  available  to meet  deposit  withdrawals  and credit  demands
without unduly penalizing profitability.  In order to maintain a proper level of
liquidity,  the banks have several  sources of funds available on a daily basis,
which can be used for  liquidity  purposes.  These  sources  of funds  primarily
include the  subsidiary  banks' core  deposits,  consisting of both business and
nonbusiness  deposits;  cash flow  generated by repayment of loan  principal and
interest;  and federal funds purchased and securities  sold under  agreements to
repurchase.  The  terms  of the  recent  FHLB  advances  have  been  taken  into
consideration in relation to the overall funding needs of the Company.

For the longer term, the liquidity position is managed by balancing the maturity
structure of the balance sheet. This process allows for an orderly flow of funds
over an extended  period of time. The Company's  Asset and Liability  Management
Committee  meets  regularly and monitors the composition of the balance sheet to
ensure comprehensive management of interest rate risk and liquidity.

Liquid assets consist of cash, cash  equivalents,  and securities  available for
sale. At June 30, 2002, such assets totaled $511.3 million, an increase of $96.8
million or 23.4% from year-end 2001. The increase in liquid assets is attributed
to the  overall  funding  position  of the  Company  combined  with the  current
interest rate environment.  Net cash provided by operating  activities was $10.7
million in the first six months of 2002,  an increase  of $563  thousand or 5.6%
compared to the same period last year. Net cash provided by investing activities
was $52.8 million, an increase of $73.6 million due primarily to a $51.0 million
decrease in net purchases and calls of available for sale investment securities.
A decrease in loan volume during the six-month periods contributed an additional
$23.9 million in the comparison.  Net cash provided by financing  activities was
$74.7  million  for the period  ended June 30,  2002.  In the same period of the
prior year,  financing  activities  used $70.0  million,  a difference of $144.7
million relating primarily to deposit account activity.

CAPITAL RESOURCES

Shareholders'  equity was $124.8  million on June 30, 2002,  an increase of $1.3
million or 1.0% from year-end 2001. The Company  purchased 91 thousand shares of
its  outstanding  common  stock  during the first six months of 2002 for a total
cost of $3.1 million.

The  Company  issued 47  thousand  shares of common  stock  during the first six
months pursuant to its nonqualified stock option plan. Dividends of $4.3 million
or $.62 per share were declared during the first six months of 2002, an increase
of 3.3% per share compared to the prior year.  Accumulated  other  comprehensive
income,  consisting  of the  unrealized  holding  gain  on  available  for  sale
investment securities (net of tax) increased $152 thousand from year-end 2001.

Consistent with the objective of operating a sound financial  organization,  the
Company's goal is to maintain  capital ratios well above the regulatory  minimum
requirements.  The Company's  capital ratios as of June 30, 2002, the regulatory
minimums and the regulatory standard for a "well capitalized" institution are as
follows:

                          Farmers Capital        Regulatory          Well
                         Bank Corporation          Minimum        Capitalized
------------------------------------------------------------------------------
Tier 1 risk based              16.30%               4.00%            6.00%
Total risk based               17.55%               8.00%           10.00%
Leverage                       10.28%               4.00%            5.00%
------------------------------------------------------------------------------

The capital ratios of all the subsidiary banks, on an individual basis, were in
excess of the applicable minimum regulatory capital ratio requirements at June
30, 2002.

EFFECT OF IMPLEMENTING RECENTLY ISSUED ACCOUNTING STANDARDS

Effective  January 1, 2002, the Company adopted Financial  Accounting  Standards
Board ("FASB")  Statement of Financial  Accounting  Standards  ("SFAS") No. 142,
GOODWILL AND OTHER  INTANGIBLE  ASSETS.  SFAS No. 142 requires that goodwill and
intangible  assets with  indefinite  useful  lives no longer be  amortized,  but
instead  be tested for  impairment  at least  annually  in  accordance  with the
provisions of Statement 142.  Statement 142 also requires that intangible assets
with definite useful lives be amortized over their  respective  estimated useful
lives  to their  estimated  residual  values  and  reviewed  for  impairment  in
accordance with SFAS No. 121, ACCOUNTING FOR THE IMPAIRMENT OF LONG-LIVED ASSETS
AND FOR  LONG-LIVED  ASSETS TO BE DISPOSED  OF. The adoption of SFAS No. 142 did
not have an effect on the consolidated financial statements of the Company.

Effective January 1, 2002, the Company adopted SFAS No. 144,  ACCOUNTING FOR THE
IMPAIRMENT  OR  DISPOSAL  OF  LONG-LIVED  ASSETS,   which  addresses   financial
accounting  and reporting for the  impairment or disposal of long-lived  assets.
While SFAS No. 144  supersedes  SFAS No. 121,  ACCOUNTING  FOR THE IMPAIRMENT OF
LONG-LIVED  ASSETS AND FOR LONG-LIVED  ASSETS TO BE DISPOSED OF, it retains many
of the fundamental provisions of that Statement.

SFAS No.  144  also  supersedes  the  accounting  and  reporting  provisions  of
Accounting   Principles   Board  Opinion  No.  30,   REPORTING  THE  RESULTS  OF
OPERATIONS-REPORTING  THE EFFECTS OF  DISPOSAL OF A SEGMENT OF A BUSINESS,  AND
EXTRAORDINARY,  UNUSUAL AND INFREQUENTLY OCCURRING EVENTS AND TRANSACTIONS,  for
the disposal of a segment of a business.  However, it retains the requirement in
Opinion No. 30 to report  separately  discontinued  operations  and extends that
reporting to a component of an entity that either has been disposed of (by sale,
abandonment,  or in a distribution to owners) or is classified as held for sale.
By  broadening  the  presentation  of  discontinued  operations  to include more
disposal  transactions,  the FASB has enhanced  management's  ability to provide
information  that helps  financial  statement  users to assess the  effects of a
disposal  transaction  on the ongoing  operations of an entity.  The adoption of
SFAS No. 144 did not have an effect on the consolidated  financial statements of
the Company.

In April 2002, the FASB issued SFAS No. 145,  RESCISSION OF FASB  STATEMENTS NO.
4, 44, AND 64,  AMENDMENT OF FASB  STATEMENT NO. 13, AND TECHNICAL  CORRECTIONS.
This Statement  rescinds FASB  Statement No. 4, REPORTING  GAINS AND LOSSES FROM
EXTINGUISHMENT  OF DEBT, and an amendment of that Statement,  FASB Statement No.
64,  EXTINGUISHMENTS  OF DEBT MADE TO SATISFY  SINKING-FUND  REQUIREMENTS.  This
Statement also rescinds FASB Statement No. 44,  ACCOUNTING FOR INTANGIBLE ASSETS
OF MOTOR CARRIERS.  This Statement amends FASB Statement No. 13,  ACCOUNTING FOR
LEASES,  to  eliminate an  inconsistency  between the  required  accounting  for
sale-leaseback  transactions  and the  required  accounting  for  certain  lease
modifications  that have  economic  effects  that are similar to  sale-leaseback
transactions.   This  Statement   also  amends  other   existing   authoritative
pronouncements  to make various  technical  corrections,  clarify  meanings,  or
describe their applicability  under changed  conditions.  The provisions of SFAS
No. 145  related to SFAS No. 4 and SFAS No. 13 are  effective  for fiscal  years
beginning and transactions occurring after May 15, 2002, respectively. All other
provisions of this Statement are effective for financial statements issued on or
after May 15,  2002.  The  adoption of this  Statement  will not have a material
effect on the Company's consolidated financial statements.

In July 2002, the FASB issued SFAS No. 146, ACCOUNTING FOR COSTS ASSOCIATED WITH
EXIT OR DISPOSAL ACTIVITIES.  This Statement requires that a liability for costs
associated  with an exit or disposal  activity to be  recognized  when  incurred
rather than at the date  commitment to an exit or disposal plan.  This Statement
replaces  EITF  94-3  and is to be  applied  prospectively  to exit or  disposal
activities  initiated  after  December 31, 2002.  The adoption of this Statement
will  not  have a  material  effect  on  the  Company's  consolidated  financial
statements.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
-------------------------------------------------------------------

The Company uses a simulation  model as a tool to monitor and evaluate  interest
rate risk  exposure.  The model is designed to measure  the  sensitivity  of net
interest  income and net income to  changing  interest  rates over  future  time
periods.  Forecasting  net  interest  income and its  sensitivity  to changes in
interest  rates  requires the Company to make  assumptions  about the volume and
characteristics  of  many  attributes,  including  assumptions  relating  to the
replacement  of  maturing  earning  assets and  liabilities.  Other  assumptions
include,  but are not limited to, projected  prepayments,  projected new volume,
and the predicted  relationship  between  changes in market  interest  rates and
changes in  customer  account  balances.  These  effects are  combined  with the
Company's  estimate of the most likely rate environment to produce a forecast of
net interest income and net income. The forecasted results are then adjusted for
the effect of a gradual  increase and decrease in market  interest  rates on the
Company's net interest income and net income. Because assumptions are inherently
uncertain, the model cannot precisely estimate net interest income or net income
or the effect of interest  rate changes on net  interest  income and net income.
Actual results could differ significantly from simulated results.

At June 30, 2002, the model  indicated that if rates were to gradually  increase
by 150 basis points during the remainder of the calendar year, then net interest
income and net income would decrease 0.66% and 1.62%, respectively, for the year
ending  December 31, 2002.  The model  indicated that if rates were to gradually
decrease by 150 basis points over the same period,  then net interest income and
net income would decrease 0.20% and 0.41%, respectively.

PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS
--------------------------

In the case of EARL H. SHILLING ET AL. V. FARMERS BANK & Capital Trust  Company,
on May 10, 2002,  the Kentucky Court of Appeals  affirmed the Jefferson  Circuit
Court's judgment in favor of the Bank. The plaintiff  bondholders filed a motion
for  discretionary  review  to the  Supreme  Court  on June 7,  2002.  It is not
possible  at this  stage of the  proceedings  to make any  prediction  as to the
outcome,  however the Supreme Court must grant the plaintiff bondholders' motion
to review the appeal,  or the affirmed judgment in favor of the Bank will become
the final outcome of the case.

There were various  other  pending  legal  actions and  proceedings  against the
Company  arising  from the normal  course of  business  and in which  claims for
damages are asserted.  Management, after discussion with legal counsel, believes
that these actions are without merit and that the ultimate  liability  resulting
from these  legal  actions  and  proceedings,  if any,  will not have a material
adverse effect upon the consolidated financial statements of the Company.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
------------------------------------------------------------

The annual meeting of shareholders  was held May 14, 2002. The matters that were
voted upon included the election of four directors for  three-year  terms ending
in 2005 or until their successors have been elected and qualified.

The outcome of the voting was as follows:
NAME                            FOR         AGAINST      WITHHELD      ABSTAINED
Gerald R. Hignite            5,609,477         0           1,982        110,115
G. Anthony Busseni           5,445,249         0         166,210        110,115
Shelley S. Sweeney           5,609,477         0           1,982        110,115
Michael M. Sullivan          5,609,669         0           1,790        110,115

Listed below are the names of each director whose term of office continued after
the meeting.

Lloyd C. Hillard, Jr.            J. Barry Banker
Harold G. Mays                   W. Benjamin Crain
Robert Roach, Jr.                Glenn Birdwhistell
Frank W. Sower, Jr.

In addition to the directors above, Dr. John P. Stewart,  Chairman Emeritus,  E.
Bruce  Dungan,  and  Charles T.  Mitchell  serve as advisory  directors  for the
Company.



ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K
-----------------------------------------

a)       List of Exhibits
         ----------------

11       Statement re computation of per share earnings
99.1     CEO Certification
99.2     CFO Certification

b)       Reports on Form 8-K
         -------------------

         None.




<PAGE>




                                   SIGNATURES

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





Date:    8-8-02                     /s/ G. Anthony Busseni
       -----------------------      --------------------------------------------
                                    G. Anthony Busseni,
                                    President and CEO
                                    (Principal Executive Officer)


Date:    8-8-02                     /s/ C. Douglas Carpenter
       -----------------------      --------------------------------------------
                                    C. Douglas Carpenter,
                                    Vice President, Secretary, and CFO
                                    (Principal Financial and Accounting Officer)

<PAGE>



Exhibit 11
                 STATEMENT RE COMPUTATION OF PER SHARE EARNINGS
                 ----------------------------------------------




--------------------------------------------------------------------------------
                                           Three Months             Six Months
                                               Ended                  Ended
                                              June 30                June 30
(In thousands, except per share data)     2002      2001         2002       2001
--------------------------------------------------------------------------------

Net income, basic and diluted           $3,316    $3,896       $7,098     $7,802
--------------------------------------------------------------------------------

Average shares outstanding               6,889     6,949        6,895      7,023
Effect of dilutive stock options            52        29           48         27
--------------------------------------------------------------------------------
Average diluted shares outstanding       6,941     6,978        6,943      7,050
--------------------------------------------------------------------------------


Net income per share, basic             $  .48    $  .56       $ 1.03     $ 1.11
Net income per share, diluted              .48       .56         1.02       1.11
--------------------------------------------------------------------------------



<PAGE>


Exhibit 99.1

                        CERTIFICATION OF PERIODIC REPORT
                        --------------------------------


I, G. Anthony Busseni, President and Chief Executive Officer of Farmers Capital
Bank Corporation, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of
2002, 18 U.S.C. Section 1350, that:

     1)   the  Quarterly  Report on Form 10-Q of the Company  for the  quarterly
          period  ended June 30, 2002 (the  "Report")  fully  complies  with the
          requirements of Section 13(a) or 15(d) of the Securities  Exchange Act
          of 1934; and

     2)   the  information  contained  in the  Report  fairly  presents,  in all
          material respects,  the financial  condition and results of operations
          of the Company.




Date:     8-8-02                          /s/ G. Anthony Busseni
       ---------------------------        --------------------------------------
                                          G. Anthony Busseni
                                          President and CEO


<PAGE>


Exhibit 99.2

                        CERTIFICATION OF PERIODIC REPORT
                        --------------------------------


I, C. Douglas Carpenter, Vice President,  Secretary, and Chief Financial Officer
of Farmers  Capital Bank  Corporation,  certify,  pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

     1)   the  Quarterly  Report on Form 10-Q of the Company  for the  quarterly
          period  ended June 30, 2002 (the  "Report")  fully  complies  with the
          requirements of Section 13(a) or 15(d) of the Securities  Exchange Act
          of 1934; and

     2)   the  information  contained  in the  Report  fairly  presents,  in all
          material respects,  the financial  condition and results of operations
          of the Company.





Date:   8-8-02                           /s/ C. Douglas Carpenter
      ---------------------------        ---------------------------------------
                                         C. Douglas Carpenter
                                         Vice President, Secretary, and CFO
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UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    FORM 10-Q

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

                  FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2002

                                       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 0-14412

                        FARMERS CAPITAL BANK CORPORATION
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)

            KENTUCKY                                     61-1017851
-------------------------------          ---------------------------------------
(State or other jurisdiction of          (I.R.S. Employer Identification Number)
incorporation or organization)

P.O. Box 309, 202 West Main Street
Frankfort, Kentucky                                       40602
---------------------------------------- ---------------------------------------
(Address of principal executive offices)               (Zip Code)

       Registrant's telephone number, including area code: (502) 227-1600

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.

                    Common stock, par value $0.125 per share
                 6,844,594 shares outstanding at August 8, 2002
TABLE OF CONTENTS

Part I - Financial Information                                                               Page No.
------------------------------                                                               --------
Item 1 - Financial Statements

         Unaudited Consolidated Balance Sheets -
             June 30, 2002 and December 31, 2001                                                 3

         Unaudited Consolidated Statements of Income -
             For the Three Months and Six Months Ended
             June 30, 2002 and June 30, 2001                                                     4

         Unaudited Consolidated Statements of Comprehensive Income -
             For the Three Months and Six Months Ended
             June 30, 2002 and June 30, 2001                                                     5

         Unaudited Consolidated Statements of Cash Flows -
             For the Six Months Ended
             June 30, 2002 and June 30, 2001                                                     6

         Unaudited Consolidated Statements of Changes in Shareholders' Equity -
             For the Six Months Ended
             June 30, 2002 and June 30, 2001                                                     7

         Notes to Unaudited Consolidated Financial Statements                                    8

     Item 2 - Management's Discussion and Analysis of Financial
                Condition and Results of Operations                                              9

     Item 3 - Quantitative and Qualitative Disclosures About Market Risk                        20

Part II - Other Information

     Item 1 - Legal Proceedings                                                                 21

     Item 4 - Submission of Matters to a Vote of Security Holders                               21

     Item 6 - Exhibits and Reports on Form 8-K                                                  22
PART I - FINANCIAL INFORMATION

Item 1. Financial Statements
----------------------------
UNAUDITED CONSOLIDATED BALANCE SHEETS
--------------------------------------------------------------------------------------------------------------------------------
                                                                                              June 30,       December 31,
(In thousands, except per share data)                                                            2002               2001
--------------------------------------------------------------------------------------------------------------------------------
ASSETS
 Cash and cash equivalents:
     Cash and due from banks                                                                 $ 116,143          $  55,977
     Interest bearing deposits in other banks                                                    4,095              3,090
     Federal funds sold and securities purchased under
          agreements to resell                                                                 124,353             47,318
--------------------------------------------------------------------------------------------------------------------------------
          Total cash and cash equivalents                                                      244,591            106,385
--------------------------------------------------------------------------------------------------------------------------------
Investment securities:
     Available for sale, amortized cost of $264,557 (2002) and $306,197 (2001)                 266,671            308,081
     Held to maturity, fair value of $34,042 (2002) and $38,505 (2001)                          32,461             37,461
--------------------------------------------------------------------------------------------------------------------------------
          Total investment securities                                                          299,132            345,542
--------------------------------------------------------------------------------------------------------------------------------
Loans, net of unearned income                                                                  695,226            701,869
Allowance for loan losses                                                                      (11,026)           (10,549)
--------------------------------------------------------------------------------------------------------------------------------
          Loans, net                                                                           684,200            691,320
--------------------------------------------------------------------------------------------------------------------------------
Premises and equipment, net                                                                     24,028             24,800
Other assets                                                                                    14,147             15,483
--------------------------------------------------------------------------------------------------------------------------------
          Total assets                                                                     $ 1,266,098        $ 1,183,530
--------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Deposits:
     Noninterest bearing                                                                   $   166,157        $   136,001
     Interest bearing                                                                          774,586            777,484
--------------------------------------------------------------------------------------------------------------------------------
          Total deposits                                                                       940,743            913,485
--------------------------------------------------------------------------------------------------------------------------------
Federal funds purchased and securities sold under agreements to repurchase                     145,443            113,792
Other short-term borrowings                                                                     19,491             12,808
Long-term debt                                                                                  26,349             10,913
Dividends payable                                                                                2,137              2,152
Other liabilities                                                                                7,098              6,820
--------------------------------------------------------------------------------------------------------------------------------
          Total liabilities                                                                  1,141,261          1,059,970
--------------------------------------------------------------------------------------------------------------------------------
Commitments and contingencies

SHAREHOLDERS' EQUITY
Common stock, par value $0.125 per share
     9,608,000 shares authorized; 8,104,735 and 8,058,244
     shares issued at June 30, 2002 and December 31, 2001, respectively                          1,013              1,007
Capital surplus                                                                                 16,608             15,179
Retained earnings                                                                              140,050            137,227
Treasury stock, at cost
     1,243,594 and 1,152,978 shares at June 30, 2002 and
     December 31, 2001, respectively                                                           (34,210)           (31,077)
Accumulated other comprehensive income                                                           1,376              1,224
--------------------------------------------------------------------------------------------------------------------------------
          Total shareholders' equity                                                           124,837            123,560
--------------------------------------------------------------------------------------------------------------------------------
          Total liabilities and shareholders' equity                                       $ 1,266,098        $ 1,183,530
--------------------------------------------------------------------------------------------------------------------------------
See accompanying notes to unaudited consolidated financial statements.
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
--------------------------------------------------------------------------------------------------------------------------------
                                                                          Three Months Ended                 Six Months Ended
                                                                                June 30,                         June 30,
(In thousands, except per share data)                                     2002           2001               2002           2001
--------------------------------------------------------------------------------------------------------------------------------
INTEREST INCOME
Interest and fees on loans                                            $ 12,639       $ 15,315           $ 25,703       $ 30,707
Interest on investment securities:
     Taxable                                                             2,601          2,525              5,343          5,165
     Nontaxable                                                            938            829              1,849          1,627
Interest on deposits in other banks                                        133             22                153             47
Interest of federal funds sold and securities
     purchased under agreements to resell                                  244            885                455          2,075
--------------------------------------------------------------------------------------------------------------------------------
          Total interest income                                         16,555         19,576             33,503         39,621
--------------------------------------------------------------------------------------------------------------------------------
INTEREST EXPENSE
Interest on deposits                                                     5,771          7,661             11,752         15,662
Interest on federal funds purchased and securities
     sold under agreements to repurchase                                   434            971                907          2,227
Interest on other borrowed funds                                           414            127                753            279
--------------------------------------------------------------------------------------------------------------------------------
          Total interest expense                                         6,619          8,759             13,412         18,168
--------------------------------------------------------------------------------------------------------------------------------
          Net interest income                                            9,936         10,817             20,091         21,453
--------------------------------------------------------------------------------------------------------------------------------
Provision for loan losses                                                  988          1,050              1,109          1,273
--------------------------------------------------------------------------------------------------------------------------------
          Net interest income after provision for loan losses            8,948          9,767             18,982         20,180
--------------------------------------------------------------------------------------------------------------------------------
NONINTEREST INCOME
Service charges and fees on deposits                                     1,960          1,747              3,779          3,301
Other service charges, commissions, and fees                               908            970              1,803          1,893
Data processing income                                                     387            380                723            708
Trust income                                                               361            507                728            893
Investment securities gains, net                                           396            186                993            465
Gain on sale of mortgage loans                                              57             65                112             97
Other                                                                       72             78                124            148
--------------------------------------------------------------------------------------------------------------------------------
          Total noninterest income                                       4,141          3,933              8,262          7,505
--------------------------------------------------------------------------------------------------------------------------------
NONINTEREST EXPENSE
Salaries and employee benefits                                           4,801          4,565              9,951          9,499
Occupancy expenses, net                                                    588            609              1,159          1,193
Equipment expenses                                                         914            774              1,840          1,581
Bank franchise tax                                                         306            297                613            593
Other                                                                    2,082          2,089              4,165          4,016
--------------------------------------------------------------------------------------------------------------------------------
          Total noninterest expense                                      8,691          8,334             17,728         16,882
--------------------------------------------------------------------------------------------------------------------------------
          Income before income taxes                                     4,398          5,366              9,516         10,803
--------------------------------------------------------------------------------------------------------------------------------
Income tax expense                                                       1,082          1,470              2,418          3,001
--------------------------------------------------------------------------------------------------------------------------------
          Net income                                                   $ 3,316        $ 3,896            $ 7,098        $ 7,802
--------------------------------------------------------------------------------------------------------------------------------
NET INCOME PER COMMON SHARE
     Basic                                                             $   .48        $   .56            $  1.03        $  1.11
     Diluted                                                               .48            .56               1.02           1.11
--------------------------------------------------------------------------------------------------------------------------------
WEIGHTED AVERAGE SHARES OUTSTANDING
     Basic                                                               6,889          6,949              6,895          7,023
     Diluted                                                             6,941          6,978              6,943          7,050
--------------------------------------------------------------------------------------------------------------------------------
See accompanying notes to unaudited consolidated financial statements.
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
--------------------------------------------------------------------------------------------------------------------------------
                                                                          Three Months Ended                Six Months Ended
                                                                               June 30,                          June 30,
(In thousands)                                                            2002           2001               2002          2001
--------------------------------------------------------------------------------------------------------------------------------
NET INCOME                                                             $ 3,316        $ 3,896            $ 7,098       $ 7,802
Other comprehensive income (loss):
     Unrealized holding gain on available for sale
     securities arising during the period, net of tax
     of $771, $50, $405, and $544, respectively                          1,432             98                753         1,056
Reclassification adjustment for prior period
     unrealized gain recognized during current period,
     net of tax of $57, $52, $324, and $123, respectively                 (106)          (100)              (601)         (239)
--------------------------------------------------------------------------------------------------------------------------------
Other comprehensive income (loss)                                        1,326             (2)               152           817
--------------------------------------------------------------------------------------------------------------------------------
Comprehensive Income                                                   $ 4,642        $ 3,894            $ 7,250       $ 8,619
--------------------------------------------------------------------------------------------------------------------------------
See accompanying notes to unaudited consolidated financial statements.
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
--------------------------------------------------------------------------------------------------------------------------------
Six months ended June 30, (In thousands)                                                             2002           2001
--------------------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES
     Net income                                                                                  $  7,098        $ 7,802
     Adjustments to reconcile net income to net cash provided
         by operating activities:
          Depreciation and amortization                                                             1,472          1,520
          Net amortization (accretion) of investment security premiums and discounts:
                Available for sale                                                                    342           (223)
                Held to maturity                                                                      (33)            (1)
          Provision for loan losses                                                                 1,109          1,273
          Noncash compensation expense                                                                296            464
          Mortgage loans originated for sale                                                      (14,399)       (18,580)
          Proceeds from sale of mortgage loans                                                     14,341         18,063
          Deferred income tax (benefit) expense                                                       (95)            14
          Gain on sale of mortgage loans                                                             (112)           (97)
          Gain on sale of premises and equipment                                                       (1)            (2)
          Gain on sale of available for sale investment securities, net                              (993)          (465)
          Decrease in accrued interest receivable                                                   1,154            757
          Decrease (increase) in other assets                                                         182           (945)
          Decrease in accrued interest payable                                                       (261)          (178)
          Increase in other liabilities                                                               556            691
--------------------------------------------------------------------------------------------------------------------------------
             Net cash provided by operating activities                                             10,656         10,093
--------------------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES
     Proceeds from maturities and calls of investment securities:
          Available for sale                                                                      222,201        217,372
          Held to maturity                                                                          5,033          7,570
     Proceeds from sale of available for sale investment securities                               125,436          7,694
     Purchase of investment securities:
          Available for sale                                                                     (305,346)      (233,817)
          Held to maturity                                                                                          (334)
     Loans originated for investment, net of principal collected                                    6,181        (17,728)
     Purchase of premises and equipment                                                              (701)        (1,580)
     Proceeds from sale of equipment                                                                    2              4
--------------------------------------------------------------------------------------------------------------------------------
             Net cash provided by (used in) investing activities                                   52,806        (20,819)
--------------------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
     Net increase (decrease) in deposits                                                           27,258        (73,184)
     Net increase in securities sold under agreements to repurchase                                31,651         19,349
     Proceeds from long-term debt                                                                  16,500
     Repayments of long-term debt                                                                  (1,064)        (3,344)
     Net increase (decrease) in other short-term borrowings                                         6,683           (389)
     Dividends paid                                                                                (4,290)        (4,299)
     Purchase of common stock                                                                      (3,133)        (8,238)
     Stock options exercised                                                                        1,139             63
--------------------------------------------------------------------------------------------------------------------------------
             Net cash provided by (used in) financing activities                                   74,744        (70,042)
--------------------------------------------------------------------------------------------------------------------------------
             Net increase (decrease) in cash and cash equivalents                                 138,206        (80,768)
--------------------------------------------------------------------------------------------------------------------------------
Cash and cash equivalents at beginning of year                                                    106,385        229,871
--------------------------------------------------------------------------------------------------------------------------------
             Cash and cash equivalents at end of period                                          $244,591       $149,103
--------------------------------------------------------------------------------------------------------------------------------
SUPPLEMENTAL DISCLOSURES
Cash paid during the period for:
     Interest                                                                                    $ 13,673       $ 18,346
     Income taxes                                                                                   2,490          3,100
Cash dividend declared and unpaid                                                                   2,137          2,084
--------------------------------------------------------------------------------------------------------------------------------
See accompanying notes to unaudited consolidated financial statements.
UNAUDITED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
------------------------------------------------------------------------------------------------------------------------------------
(In thousands, except per share data)                                                                  Accumulated
                                                                                                           Other           Total
Six months ended                        Common Stock       Capital    Retained    Treasury Stock      Comprehensive    Shareholders'
June 30, 2002 and 2001                Shares   Amount      Surplus    Earnings   Shares     Amount        Income          Equity
------------------------------------------------------------------------------------------------------------------------------------
Balance at January 1, 2002          8,058    $1,007      $15,179   $ 137,227   1,153   $ (31,077)       $ 1,224        $123,560
Net income                                                               7,098                                              7,098
Other comprehensive income                                                                                    152             152
Cash dividends declared,
  $.62 per share                                                        (4,275)                                            (4,275)
Purchase of common stock                                                            91      (3,133)                        (3,133)
Stock options exercised                  47         6        1,133                                                          1,139
Noncash compensation expense
  attributed to stock option grants                            296                                                            296
------------------------------------------------------------------------------------------------------------------------------------
  Balance at June 30, 2002            8,105    $1,013      $16,608   $ 140,050   1,244   $ (34,210)       $ 1,376        $124,837
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
  Balance at January 1, 2001          8,032    $1,004      $13,634   $ 131,021     860   $ (20,755)       $   557        $125,461
Net income                                                               7,802                                              7,802
Other comprehensive income                                                                                    817             817
Cash dividends declared,
  $.60 per share                                                        (4,228)                                            (4,228)
Purchase of common stock                                                           234      (8,238)                        (8,238)
Stock options exercised                   2                     63                                                             63
Noncash compensation expense
  attributed to stock option grants                            464                                                            464
------------------------------------------------------------------------------------------------------------------------------------
  Balance at June 30, 2001            8,034    $1,004      $14,161   $ 134,595   1,094   $ (28,993)       $ 1,374       $ 122,141
------------------------------------------------------------------------------------------------------------------------------------
See accompanying notes to unaudited consolidated financial statements.
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

1.   BASIS OF PRESENTATION

The consolidated  financial  statements  include the accounts of Farmers Capital
Bank  Corporation  (the  "Company"),   a  financial  holding  company,  and  its
subsidiaries,  including its principal subsidiary,  Farmers Bank & Capital Trust
Company.  All  significant  intercompany  transactions  and  accounts  have been
eliminated in consolidation.

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States of America requires  management to make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities  and disclosure of contingent  assets and liabilities as of the date
of the financial  statements  and the reported  amounts of revenues and expenses
during the reporting period.  Estimates used in the preparation of the financial
statements  are based on various  factors  including  the current  interest rate
environment  and the  general  strength  of the local  economy.  Changes  in the
overall  interest rate  environment can  significantly  affect the Company's net
interest  income and the value of its recorded  assets and  liabilities.  Actual
results  could  differ  from  those  estimates  used in the  preparation  of the
financial statements.

The  financial  information  presented as of any date other than December 31 has
been  prepared  from the books  and  records  without  audit.  The  accompanying
consolidated  financial  statements  have been prepared in  accordance  with the
instructions  to Form 10-Q and Rule 10-01 of  Regulation  S-X and do not include
all of the  information  and the  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  adjustments,  necessary  for a fair  presentation  of such  financial
statements,  have been  included.  The  results of  operations  for the  interim
periods are not  necessarily  indicative  of the results to be expected  for the
full year.

For further  information,  refer to the  consolidated  financial  statements and
footnotes  thereto  included in the Company's Annual Report on Form 10-K for the
year ended December 31, 2001.

2.   RECLASSIFICATIONS

Certain   reclassifications   have  been  made  to  the  consolidated  financial
statements of prior periods to conform to the current period presentation.  Such
reclassifications have no effect on previously reported net income.
ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
--------------------------------------------------------------------------------
         OF OPERATIONS
         -------------

FORWARD-LOOKING STATEMENTS

This report contains  forward-looking  statements  under the Private  Securities
Litigation Reform Act of 1995 that involve risks and uncertainties. Although the
Company believes that the assumptions underlying the forward-looking  statements
contained herein are reasonable, any of the assumptions could be inaccurate, and
therefore,  there  can  be no  assurance  that  the  forward-looking  statements
included  herein will prove to be  accurate.  Factors  that could  cause  actual
results to differ from the results discussed in the  forward-looking  statements
include,  but are not limited to: economic  conditions  (both generally and more
specifically in the markets in which the Company and its subsidiaries  operate);
competition  for the  Company's  customers  from other  providers  of  financial
services; government legislation and regulation (which changes from time to time
and over which the Company has no control);  changes in interest rates; material
unforeseen  changes  in the  liquidity,  results  of  operations,  or  financial
condition of the Company's customers;  and other risks detailed in the Company's
filings with the Securities and Exchange Commission,  all of which are difficult
to predict and many of which are beyond the control of the Company.

RESULTS OF OPERATIONS

                   SECOND QUARTER 2002 VS. SECOND QUARTER 2001
                   -------------------------------------------

The Company  reported  net income of $3.3  million or $.48 per basic and diluted
share for the second  quarter of 2002  compared to net income of $3.9 million or
$.56 per basic and diluted share for the second quarter of 2001. This represents
a decrease of 14.3% on a per share basis.  Net  interest  income for the current
quarter totaled $9.9 million,  a decrease of $881 thousand or 8.1%.  Noninterest
income  increased  $208 thousand or 5.3%.  Noninterest  expense  increased  $357
thousand or 4.3%.

Return on average assets ("ROA") was 1.10% for the current  quarter,  a decrease
of 29 basis points  compared to 1.39%  reported for the same period in 2001. The
29 basis point  decrease  in ROA was  attributed  to a decrease in net  interest
margin of 47 basis points to 3.94%.  The lower net interest margin was partially
offset by a decrease in  noninterest  expense  relative to average  assets of 10
basis points and a decrease in income tax expense  relative to average assets of
14 basis points.  Return on average  equity was 10.71% for the second quarter of
2002 compared to 12.95% in the same period of 2001.

NET INTEREST INCOME
-------------------

The interest  rate  environment  has been  extremely  volatile in the  quarterly
comparison,  as general market interest rates have dropped  significantly  since
the second  quarter of 2001.  Actions  taken by the Federal  Reserve  Board (the
"Fed") to reduce short-term  interest rates by 200 basis points since the end of
the second quarter of 2001 have affected the Company's net interest  margin,  as
well as the net interest margin of many financial  institutions in the industry.
The effect of the Fed's  actions on the  Company has  generally  led to interest
rates on earning  assets  declining  more  rapidly  than rates paid on  interest
bearing  liabilities.  During a falling rate  environment,  the  challenge is to
reduce the rates paid on interest bearing  liabilities  (primarily  deposits) to
offset the decline in the yield on variable rate assets  (primarily loans) while
remaining  competitive  in our markets.  The Company's  tax-equivalent  yield on
earning  assets for the current three months was 6.43%, a reduction of 141 basis
points from the same period a year ago. The cost of funds for the current  three
months was 2.88%,  a decline of 131 basis  points  compared to the same period a
year ago. A goal of the Company in the current  interest rate  environment is to
increase earning assets and decrease the interest rates paid on interest bearing
liabilities while remaining  competitive in our markets.  Average earning assets
increased  $43.3  million or 4.2% in the  quarterly  comparison.  However,  as a
percentage of total average  assets,  earning  assets  declined 299 basis points
from 91.37% to 88.38%.  Average  interest  paying  liabilities  increased  $84.0
million or 10.0% in the comparison.

Interest income totaled $16.6 million for the second quarter of 2002, a decrease
of $3.0 million or 15.4% compared to the same period in the prior year. Interest
expense totaled $6.6 million,  a decrease of $2.1 million or 24.4%. Net interest
income before  provision  for loan losses  declined $881 thousand or 8.1% in the
comparison and totaled $9.9 million at June 30, 2002.

Interest and fees on loans  decreased  $2.7 million  mainly due to a decrease in
the average rate earned.  Average loans  decreased $5.2 million or 0.75%,  while
the yield  decreased 148 basis points to 7.41%.  Interest on taxable  securities
increased  $76  thousand  or 3.0%  due  primarily  to a $55.8  million  or 31.8%
increase in the average  balance.  The increase in the average  balance offset a
126 basis  point  decline in the average  rate  earned.  Interest on  nontaxable
securities  increased  $109  thousand or 13.1% due to an increase in the average
balance of $9.6 million  combined with a 20 basis point  increase in the average
rate  earned  of 6.68%.  Interest  on  short-term  investments,  including  time
deposits in other banks,  federal funds sold,  and  securities  purchased  under
agreements to resell, decreased $530 thousand due primarily to a 214 basis point
decrease in the average rate earned on these investments as well as a decline in
the average balance of $16.9 million or 21.0%.

Interest  expense on deposits  decreased  $1.9 million or 24.7% to $5.8 million.
This  decrease  resulted  from a  general  decline  in  the  average  rate  paid
throughout the deposit  portfolio,  which offset increases in average  balances.
The decline in interest  expense on deposits was as follows:  time deposits $1.1
million or 19.1%;  interest  bearing demand deposits $327 thousand or 38.5%; and
savings deposits $467 thousand or 43.9%. The average rate paid on time deposits,
the largest  component of interest bearing  deposits,  was 4.62% for the current
quarter  compared to 5.96% for the same period of 2001.  The average  balance of
time deposits  increased  $16.6 million or 4.3% to $403.3  million.  The average
rate paid on interest bearing demand deposits  declined 78 basis points to 0.98%
while the average  balance  increased  $20.0 million or 10.3% to $214.1 million.
The average rate paid on savings  deposits  decreased  124 basis points to 1.45%
while the average  balance  increased  $7.2  million or 4.5% to $165.9  million.
Interest expense on federal funds purchased and securities sold under agreements
to  repurchase  decreased  $537  thousand  due  primarily  to a 242 basis  point
decrease in the average rate paid. The significant  decrease in the average rate
paid offset a $2.5  million or 2.7%  increase in the average  balance.  Interest
expense on other  borrowed  funds  increased  $287 thousand in the comparison as
additional  borrowings  from the Federal  Home Loan Bank  increased  the average
balance outstanding.  The average rate paid on other borrowed funds declined 285
basis points to 3.64%.

The net interest  margin on a tax equivalent  basis decreased 47 basis points to
3.94% during the second  quarter of 2002 compared to 4.41% in the second quarter
of 2001.  The decrease in net interest  margin is primarily  attributed  to a 37
basis point decline in the impact of noninterest  bearing sources of funds.  The
effect of noninterest  bearing sources of funds on net interest margin typically
declines in a falling rate  environment.  Also  contributing to the reduction in
net  interest  margin is a 10 basis point  decline in the spread  between  rates
earned and paid that totaled 3.55% for the current quarter  compared to 3.65% in
the same quarter a year earlier.
The  following  tables  present  an  analysis  of net  interest  income  for the
quarterly periods ended June 30.
DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY:  INTEREST RATES AND INTEREST DIFFERENTIAL
------------------------------------------------------------------------------------------------------------------------------
Quarter Ended June 30,                                          2002                                       2001
------------------------------------------------------------------------------------------------------------------------------
                                             Average                        Average        Average                   Average
(In thousands)                               Balance         Interest         Rate         Balance      Interest       Rate
------------------------------------------------------------------------------------------------------------------------------
EARNING ASSETS
Investment securities
  Taxable                                $   231,433         $ 2,601          4.51%    $   175,635      $ 2,525        5.77%
  Nontaxable1                                 82,347           1,372          6.68          72,784        1,175        6.48
Time deposits with banks, federal
  funds sold and securities purchased
  under agreements to resell                  63,383             377          2.39          80,251          907        4.53
Loans1,2,3                                   691,429          12,775          7.41         696,656       15,437        8.89
------------------------------------------------------------------------------------------------------------------------------
     Total earning assets                  1,068,592         $17,125          6.43%      1,025,326      $20,044        7.84%
------------------------------------------------------------------------------------------------------------------------------
Allowance for loan losses                    (10,393)                                      (10,531)
------------------------------------------------------------------------------------------------------------------------------
     Total earning assets, net of
     allowance for loan losses             1,058,199                                     1,014,795
------------------------------------------------------------------------------------------------------------------------------
NONEARNING ASSETS
Cash and due from banks                      112,936                                        67,404
Premises and equipment, net                   24,312                                        25,133
Other assets                                  13,602                                        14,853
------------------------------------------------------------------------------------------------------------------------------
     Total assets                        $ 1,209,049                                   $ 1,122,185
------------------------------------------------------------------------------------------------------------------------------
INTEREST BEARING LIABILITIES
Deposits
  Interest bearing demand                $   214,116         $   523          0.98%    $   194,160      $   850        1.76%
  Savings                                    165,918             598          1.45         158,745        1,065        2.69
  Time                                       403,276           4,650          4.62         386,641        5,746        5.96
Federal funds purchased and
  securities sold under agreements
  to repurchase                               93,539             434          1.86          91,064          971        4.28
Other borrowed funds                          45,576             414          3.64           7,843          127        6.49
------------------------------------------------------------------------------------------------------------------------------
     Total interest bearing liabilities      922,425         $ 6,619          2.88%        838,453      $ 8,759        4.19%
------------------------------------------------------------------------------------------------------------------------------
NONINTEREST BEARING LIABILITIES
Commonwealth of Kentucky deposits             39,927                                        37,743
Other demand deposits                        114,413                                       116,057
Other liabilities                              8,095                                         9,283
------------------------------------------------------------------------------------------------------------------------------
     Total liabilities                      1,084,860                                    1,001,536
------------------------------------------------------------------------------------------------------------------------------
     Shareholders' equity                     124,189                                      120,649
------------------------------------------------------------------------------------------------------------------------------
     Total liabilities and shareholders'
     equity                               $ 1,209,049                                  $ 1,122,185
------------------------------------------------------------------------------------------------------------------------------
Net interest income                                            10,506                                    11,285
TE basis adjustment                                              (570)                                     (468)
------------------------------------------------------------------------------------------------------------------------------
     Net interest income                                      $ 9,936                                   $10,817
------------------------------------------------------------------------------------------------------------------------------
Net interest spread                                                           3.55%                                    3.65%
Impact of noninterest bearing sources
  of funds                                                                     .39                                      .76
------------------------------------------------------------------------------------------------------------------------------
Net interest margin                                                           3.94%                                    4.41%
------------------------------------------------------------------------------------------------------------------------------

1Income and yield stated at a fully tax equivalent basis using a 35% tax rate.
2Loan balances include principal balances on nonaccrual loans.
3Loan fees included in interest income amount to $476 thousand and $495 thousand in 2002 and 2001, respectively.
ANALYSIS OF CHANGES IN NET INTEREST INCOME (TAX EQUIVALENT BASIS)
------------------------------------------------------------------------------------------------------------------------------
(In thousands)                                                          Variance         Variance Attributed to
Quarter ended June 30,                                                 2002/20011         Volume          Rate
------------------------------------------------------------------------------------------------------------------------------
INTEREST INCOME
Taxable investment securities                                            $   76         $ 2,668       $ (2,592)
Nontaxable investment securities2                                           197             159             38
Time deposits with banks, federal funds sold and
   securities purchased under agreements to resell                         (530)           (163)          (367)
Loans2                                                                   (2,662)           (115)        (2,547)
------------------------------------------------------------------------------------------------------------------------------
     Total interest income                                               (2,919)          2,549         (5,468)
------------------------------------------------------------------------------------------------------------------------------
INTEREST EXPENSE
Interest bearing demand deposits                                           (327)            508           (835)
Savings deposits                                                           (467)            310           (777)
Time deposits                                                            (1,096)          1,488         (2,584)
Federal funds purchased and securities sold under
   agreements to repurchase                                                (537)            178           (715)
Other borrowed funds                                                        287             673           (386)
------------------------------------------------------------------------------------------------------------------------------
     Total interest expense                                              (2,140)          3,157         (5,297)
------------------------------------------------------------------------------------------------------------------------------
Net interest income                                                      $ (779)         $ (608)       $  (171)
------------------------------------------------------------------------------------------------------------------------------
Percentage change                                                         100.0%           78.0%          22.0%
------------------------------------------------------------------------------------------------------------------------------

1The changes that are not solely due to rate or volume are allocated on a percentage basis using the absolute values of rate and
 volume variances as a basis for allocation.
2Income stated at fully tax equivalent basis using a 35% tax rate.
NONINTEREST INCOME
------------------

Noninterest income totaled $4.1 million for the current quarter,  an increase of
$208  thousand or 5.3% compared to the prior year.  Service  charges and fees on
deposits,  the largest component of noninterest income,  increased $213 thousand
or 12.2% primarily due to the new overdraft policy and related NSF fee structure
that is now  fully in place at each of the  Company's  subsidiary  banks.  Other
service  charges,  commissions,  and fees  decreased  $62  thousand  or 6.4% due
primarily to a $37 thousand or 33.0% decrease in fee income on loans  originated
for sale to unrelated third parties. Trust fees decreased $146 thousand or 28.8%
due primarily to unusually large estate fees collected  during the same period a
year earlier. Net gains on the sale of available for sale investment  securities
totaled $396 thousand, an increase of $210 thousand.

NONINTEREST EXPENSE
-------------------

Total  noninterest  expense  increased  $357  thousand  or 4.3% from the  second
quarter of 2001 and totaled $8.7 million.  Salaries and employee  benefits,  the
largest  component of  noninterest  expense,  increased  $236  thousand or 5.2%.
Employee  benefits  increased  $249 thousand in the quarterly  comparison  while
salaries and related payroll taxes increased $77 thousand.  Noncash compensation
expense  attributed  to stock option grants  decreased  $90 thousand.  Occupancy
expense,  net of rental  income,  decreased $21 thousand in the  comparison  and
totaled $588 thousand.  Equipment expense totaled $914 thousand,  an increase of
$140  thousand or 18.1%.  The  increase  is  primarily  the result of  increased
depreciation.  Bank  franchise  tax  increased  3.0%  to  $306  thousand.  Other
noninterest expense decreased less than 1% and totaled $2.1 million.

INCOME TAXES
------------

Income tax expense for the second  quarter of 2002 was $1.1 million,  a decrease
of $388  thousand or 26.4% from the second  quarter of 2001.  The  effective tax
rate was 24.6% for the current quarter,  a decrease of 280 basis points from the
second  quarter of 2001.  The  decrease  in the  effective  tax rate is due to a
combination  of  factors,   including  the  following:   tax-exempt   investment
securities  averaged $82.3 million,  an increase of $9.6 million or 13.1% in the
quarterly  comparison;  tax-exempt  municipal  loans averaged $19.6 million,  an
increase of $7.0  million or 55.8%;  and taxable  earning  assets  repriced to a
lower  interest  rate at a faster  pace than  tax-exempt  earning  assets in the
rapidly declining  interest rate environment.  The result is less taxable income
in proportion to total income.

                            FIRST SIX MONTHS OF 2002
                            ------------------------

Net income for the six months ended June 30, 2002 was $7.1  million  compared to
net income of $7.8  million  for the same  period in 2001,  a  decrease  of $704
thousand or 9.0%.  On a basic and diluted per share  basis,  net income  totaled
$1.03 and $1.02 for the current six-month period, a decrease of $.08 or 7.2% and
$.09 or 8.1%,  respectively.  The  decrease in net income is due  primarily to a
decline in net interest  income.  Net interest income  decreased $1.4 million or
6.3% in the six-month comparison.

ROA was 1.19% for the six months  ended June 30,  2002,  a decrease  of 23 basis
points  from the same  period in 2001.  The 23 basis  point  decrease in ROA was
attributed to a decrease in net interest margin of 46 basis points to 3.97%. The
lower net  interest  margin was  partially  offset by a decrease in  noninterest
expense  relative to average  assets of 9 basis  points and a decrease in income
tax expense  relative to average  assets of 12 basis  points.  Return on average
equity was 11.53%,  a decrease of 133 basis  points from the first six months of
2001.

NET INTEREST INCOME
-------------------

The interest  rate  environment  has been  extremely  volatile in the  six-month
comparison,  as general market interest rates have dropped  significantly  since
the  second  quarter  of 2001.  Actions  taken by the Fed to  reduce  short-term
interest  rates by 200 basis points since the end of the second  quarter of 2001
have  affected the Company's  net interest  margin,  as well as the net interest
margin of many financial  institutions in the industry.  The effect of the Fed's
actions on the Company has  generally  led to interest  rates on earning  assets
declining more rapidly than rates paid on interest bearing liabilities. During a
falling rate environment,  the challenge is to reduce the rates paid on interest
bearing liabilities  (primarily  deposits) to offset the decline in the yield on
variable  rate assets  (primarily  loans)  while  remaining  competitive  in our
markets.  The Company's  tax-equivalent  yield on earning assets for the current
six months was 6.47%,  a  reduction  of 156 basis  points from the same period a
year ago.  The cost of funds for the current six months was 2.93%,  a decline of
148 basis  points  compared to the same period a year ago. A goal of the Company
in the current  interest  rate  environment  is to increase  earning  assets and
decrease the interest rates paid on interest bearing liabilities while remaining
competitive in our markets.  Average  earning assets  increased $60.2 million or
5.9% in the  comparison.  However,  as a  percentage  of total  average  assets,
earning assets declined 208 basis points from 91.71% to 89.63%. Average interest
paying liabilities increased $91.0 million or 11.0% in the comparison.

Interest  income totaled $33.5 million for the six months ended June 30, 2002, a
decrease of $6.1 million or 15.4% compared to the same period in 2001.  Interest
expense was $13.4  million,  a decrease of $4.8  million or 26.2%.  Net interest
income declined $1.4 million or 6.3%

Interest and fees on loans  decreased  $5.0 million or 16.3%  primarily due to a
145 basis point  decline in the average  rate earned of 7.59% in the current six
months.  Average loans  outstanding  were  virtually  unchanged at $690 million.
Interest  on  taxable  securities  increased  $178  thousand  or 3.4% as a $74.1
million increase in the average balance outstanding offset a decline in yield of
168 basis points.  Interest on nontaxable  securities increased $222 thousand or
13.6% due to an increase  in both the  average  balance and rate earned of $10.5
million  or 14.7% and 16 basis  points,  respectively.  Interest  on  short-term
investments,  including  time deposits in other banks,  federal funds sold,  and
securities purchased under agreements to resell, decreased $1.5 million or 71.4%
due primarily to a 303 basis point decrease in the average rate earned.  A $24.3
million decrease in the average balance also contributed to the decrease.

Interest  expense on deposits  declined $3.9 million or 25.0% to $11.8  million.
This  decrease  resulted  from a  general  decline  in  the  average  rate  paid
throughout the deposit  portfolio,  which offset increases in average  balances.
The decline in interest  expense on deposits was as follows:  time deposits $1.9
million or 16.9%;  interest  bearing demand deposits $834 thousand or 43.5%; and
savings  deposits $1.2 million or 48.7%. The average rate paid on time deposits,
the largest  component of interest bearing  deposits,  was 4.75% for the current
six months compared to 6.02% for the same period of 2001. The average balance of
time deposits  increased  $20.2 million or 5.3% to $401.6  million.  The average
rate paid on interest bearing demand deposits  declined 97 basis points to 1.01%
while the average  balance  increased  $20.0 million or 10.3% to $215.3 million.
The average rate paid on savings  deposits  decreased  153 basis points to 1.49%
while the average  balance  increased  $6.8  million or 4.3% to $164.3  million.
Interest expense on federal funds purchased and securities sold under agreements
to repurchase decreased $1.3 million or 59.3% due primarily to a 324 basis point
decrease in the average rate paid. The significant  decrease in the average rate
paid offset a $12.0 million or 13.5% increase in the average  balance.  Interest
expense on other  borrowed  funds  increased  $474 thousand in the comparison as
additional  borrowings  from the Federal  Home Loan Bank  increased  the average
balance  outstanding.  The increase in the average balance  outstanding offset a
287 basis point decline in the average rate paid.

The net interest  margin on a tax equivalent  basis decreased 46 basis points to
3.97%  during the first six months of 2002  compared to the same period of 2001.
The decrease in net interest margin is primarily  attributed to a 38 basis point
decline in the impact of  noninterest  bearing  sources of funds.  The effect of
noninterest  bearing sources of funds on net interest margin typically  declines
in a  falling  rate  environment.  Also  contributing  to the  reduction  in net
interest  margin is an 8 basis point decline in the spread  between rates earned
and paid that totaled 3.54% for the current six months  compared to 3.62% in the
same period a year earlier.
The  following  tables  present an analysis of net  interest  income for the six
months ended June 30.
DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY:  INTEREST RATES AND INTEREST DIFFERENTIAL
----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended June 30,                                         2002                                       2001
----------------------------------------------------------------------------------------------------------------------------------
                                                 Average                      Average       Average                       Average
(In thousands)                                   Balance         Interest       Rate        Balance        Interest         Rate
----------------------------------------------------------------------------------------------------------------------------------
EARNING ASSETS
Investment securities
  Taxable                                    $   246,098        $  5,343       4.38%    $   171,957        $ 5,165         6.06%
  Nontaxable1                                     81,876           2,699       6.65          71,379          2,298         6.49
Time deposits with banks, federal
  funds sold and securities purchased
  under agreements to resell                      60,279             608       2.03          84,614          2,122         5.06
Loans1,2,3                                       690,242          25,968       7.59         690,379         30,948         9.04
----------------------------------------------------------------------------------------------------------------------------------
     Total earning assets                      1,078,495        $ 34,618       6.47%      1,018,329       $ 40,533         8.03%
----------------------------------------------------------------------------------------------------------------------------------
Allowance for loan losses                        (10,476)                                   (10,469)
----------------------------------------------------------------------------------------------------------------------------------
     Total earning assets, net of
     allowance for loan losses                1,068,019                                   1,007,860
----------------------------------------------------------------------------------------------------------------------------------
NONEARNING ASSETS
Cash and due from banks                           99,222                                     65,055
Premises and equipment, net                       24,502                                     25,088
Other assets                                      11,511                                     12,433
----------------------------------------------------------------------------------------------------------------------------------
     Total assets                            $ 1,203,254                                $ 1,110,436
----------------------------------------------------------------------------------------------------------------------------------
INTEREST BEARING LIABILITIES
Deposits
  Interest bearing demand                      $ 215,265        $  1,082       1.01%      $ 195,240        $ 1,916         1.98%
  Savings                                        164,324           1,211       1.49         157,489          2,361         3.02
  Time                                           401,646           9,459       4.75         381,439         11,385         6.02
Federal funds purchased and
  securities sold under agreements
  to repurchase                                  101,037             907       1.81          89,012          2,227         5.05
Other borrowed funds                              40,432             753       3.76           8,482            279         6.63
----------------------------------------------------------------------------------------------------------------------------------
     Total interest bearing liabilities          922,704        $ 13,412       2.93%        831,662       $ 18,168         4.41%
----------------------------------------------------------------------------------------------------------------------------------
NONINTEREST BEARING LIABILITIES
Commonwealth of Kentucky deposits                 35,146                                     35,185
Other demand deposits                            114,910                                    114,490
Other liabilities                                  6,355                                      6,776
----------------------------------------------------------------------------------------------------------------------------------
     Total liabilities                         1,079,115                                    988,113
----------------------------------------------------------------------------------------------------------------------------------
     Shareholders' equity                        124,139                                    122,323
----------------------------------------------------------------------------------------------------------------------------------
     Total liabilities and shareholders'
     equity                                  $ 1,203,254                                $ 1,110,436
----------------------------------------------------------------------------------------------------------------------------------
Net interest income                                               21,206                                    22,365
TE basis adjustment                                               (1,115)                                     (912)
----------------------------------------------------------------------------------------------------------------------------------
     Net interest income                                        $ 20,091                                  $ 21,453
----------------------------------------------------------------------------------------------------------------------------------
Net interest spread                                                            3.54%                                       3.62%
Impact of noninterest bearing sources
   of funds                                                                     .43                                         .81
----------------------------------------------------------------------------------------------------------------------------------
Net interest margin                                                            3.97%                                       4.43%
----------------------------------------------------------------------------------------------------------------------------------

1Income and yield stated at a fully tax equivalent basis using a 35% tax rate.
2Loan balances include principal balances on nonaccrual loans.
3Loan fees included in interest income amount to $906 thousand and $921 thousand in 2002 and 2001, respectively.
ANALYSIS OF CHANGES IN NET INTEREST INCOME (TAX EQUIVALENT BASIS)
----------------------------------------------------------------------------------------------------------------------------------
(In thousands)                                                          Variance        Variance Attributed to
Six Months Ended June 30,                                              2002/20011        Volume          Rate
----------------------------------------------------------------------------------------------------------------------------------
INTEREST INCOME
Taxable investment securities                                           $   178        $ 3,625       $ (3,447)
Nontaxable investment securities2                                           401            343             58
Time deposits with banks, federal funds sold and
   securities purchased under agreements to resell                       (1,514)          (491)        (1,023)
Loans2                                                                   (4,980)            (6)        (4,974)
----------------------------------------------------------------------------------------------------------------------------------
     Total interest income                                               (5,915)         3,471         (9,386)
----------------------------------------------------------------------------------------------------------------------------------
INTEREST EXPENSE
Interest bearing demand deposits                                           (834)           511         (1,345)
Savings deposits                                                         (1,150)           289         (1,439)
Time deposits                                                            (1,926)         1,558         (3,484)
Federal funds purchased and securities sold under
   agreements to repurchase                                              (1,320)           773         (2,093)
Other borrowed funds                                                        474            861           (387)
----------------------------------------------------------------------------------------------------------------------------------
     Total interest expense                                              (4,756)         3,992         (8,748)
----------------------------------------------------------------------------------------------------------------------------------
Net interest income                                                    $ (1,159)        $ (521)       $  (638)
----------------------------------------------------------------------------------------------------------------------------------
Percentage change                                                         100.0%          45.0%          55.0%
----------------------------------------------------------------------------------------------------------------------------------

1The changes that are not solely due to rate or volume are allocated on a percentage basis using the absolute values of rate and
 volume variances as a basis for allocation.
2Income stated at fully tax equivalent basis using a 35% tax rate.
NONINTEREST INCOME
------------------

Noninterest  income  was $8.3  million  for the  first six  months  of 2002,  an
increase of $757 thousand or 10.1% compared to the same period in 2001.  Service
charges and fees on  deposits,  the largest  component  of  noninterest  income,
increased $478 thousand or 14.5%  primarily due to the new overdraft  policy and
related NSF fee  structure  that is now fully in place at each of the  Company's
subsidiary  banks.  Other service charges,  commissions,  and fees decreased $90
thousand  or 4.8% to $1.8  million  primarily  due to a  decrease  in  custodial
safekeeping  fees from the  Commonwealth of Kentucky.  Trust fees decreased $165
thousand or 18.5% due primarily to unusually large estate fees collected  during
the same period in 2001. Net gains on the sale of available for sale  investment
securities  totaled  $993  thousand in the current  period,  an increase of $528
thousand compared to a year earlier.

NONINTEREST EXPENSE
-------------------

Total  noninterest  expense  increased  $846  thousand or 5.0% and totaled $17.7
million for the first six months of 2002.  Salaries and employee  benefits,  the
largest component of noninterest expense, increased $452 thousand or 4.8% in the
six-month   comparison.   Employee  benefits  increased  $351  thousand  in  the
comparison  while  salaries and related  payroll taxes  increased $269 thousand.
Noncash  compensation  expense  attributed to stock option grants decreased $168
thousand.  Occupancy  expense,  net of rental income,  decreased $34 thousand or
2.8% in the  comparison.  Equipment  expense  increased  $259  thousand or 16.4%
primarily due to an increase in depreciation expense. Bank franchise tax expense
and other  noninterest  expense increased $169 thousand or 3.7% to $4.8 million.
The increase in other  noninterest  expense is primarily  attributable to a $146
thousand increase in losses on foreclosed assets.

INCOME TAXES
------------

Income tax expense for the first six months of 2002 was $2.4 million, a decrease
of $583 thousand or 19.4% compared to the same period in 2001. The effective tax
rate was 25.4% for the first six months of 2002,  a decrease of 240 basis points
from  the  prior  year.  The  decrease  in the  effective  tax  rate is due to a
combination  of  factors,   including  the  following:   tax-exempt   investment
securities  averaged $81.9 million, an increase of $10.5 million or 14.7% in the
comparison;  tax-exempt  municipal loans averaged $18.3 million,  an increase of
$6.4 million or 53.3%;  and taxable  earning assets repriced to a lower interest
rate at a faster pace than  tax-exempt  earning assets in the rapidly  declining
interest rate  environment.  The result is less taxable  income in proportion to
total income.

FINANCIAL CONDITION

Total assets were $1.3 billion on June 30, 2002, an increase of $82.6 million or
7.0% from December 31, 2001. Fluctuations in assets and deposits are typical due
to the relationship between the Company's principal  subsidiary,  Farmers Bank &
Capital Trust Company and the  Commonwealth  of Kentucky.  Farmers Bank provides
various  services to state agencies of the  Commonwealth.  As the depository for
the Commonwealth,  these agencies issue checks drawn on Farmers Bank,  including
paychecks and state income tax refunds.  Farmers Bank also processes vouchers of
the WIC  (Women,  Infants  and  Children)  program  for the  Cabinet  for  Human
Resources.  The Bank's investment  department provides services to the Teacher's
Retirement systems.  As the depository for the Commonwealth,  large fluctuations
in deposits are likely to occur on a daily  basis.  On an average  basis,  total
assets were $1.2 billion for the first six months of 2002,  an increase of $59.6
million or 5.2% from year-end 2001. Average earning assets were 89.6% of average
total  assets at June 30,  2002,  a decrease  of 172 basis  points  compared  to
year-end 2001

LOANS
-----

Loans,  net of unearned  income,  totaled  $695.2  million at June 30,  2002,  a
decrease of $6.6 million or 0.9% from  year-end  2001.  This  reduction in loans
outstanding  is primarily the result of decreases in commercial  and  industrial
loans of $7.5 million or 9.7% and lease financing of $2.5 million or 6.1%. Loans
to states and political subdivision increased $4.1 million or 27.9%. Average net
loans for the  six-month  period  ended June 30,  2002 were  $690.2  million,  a
decrease of $8.5  million or 1.2%  compared to the  year-end  2001  average.  On
average,  loans  represented  64.0% of earning  assets during the current period
compared to 66.9% for year-end  2001. As loan demand  fluctuates,  the available
funds  are  redirected  between  either  temporary   investments  or  investment
securities.

ALLOWANCE FOR LOAN LOSSES
-------------------------

The allowance for loan losses was $11.0 million at June 30, 2002, an increase of
$477 thousand or 4.5% from the prior year-end. The allowance for loan losses was
1.59% of net loans at June 30, 2002,  an increase of nine basis points  compared
to December 31, 2001. The increase in the allowance for loan losses is primarily
attributed to the  significant  increase in  nonperforming  loans,  as discussed
below,  and the related  estimated  credit risk  within the loan  portfolio.  In
management's  opinion, the allowance for loan losses is adequate to cover losses
inherent in the loan  portfolio.  The  provision  for loan losses  decreased $62
thousand and $164 thousand in the current three and six-month  periods  compared
to the same periods in 2001.  The Company had net  charge-offs  of $291 thousand
and $632 thousand in the current three and six month periods of 2002 compared to
net  charge-offs  of $946 thousand and $1.0 million in the same periods of 2001.
Annualized net charge-offs  represented 0.17% and 0.18% of average net loans for
the current  three and  six-month  periods,  respectively,  compared to 0.31% at
year-end  2001.   Management  continues  to  emphasize  collection  efforts  and
evaluation of risks within the loan portfolio.

NONPERFORMING ASSETS
--------------------

Nonperforming  assets for the Company include  nonperforming  loans,  other real
estate owned,  and other  foreclosed  assets.  Nonperforming  loans  consists of
nonaccrual loans,  restructured loans, and loans past due ninety days or more on
which interest is still accruing.  Nonperforming assets totaled $21.1 million at
June  30,  2002,  an  increase  of  $14.8  million  from  the  prior   year-end.
Nonperforming  loans totaled $20.7 million at June 30, 2002 an increase of $15.5
million  compared to year-end 2001.  Nonperforming  loans as a percentage of net
loans  were 2.97% at June 30,  2002  compared  to 0.74% at  year-end  2001.  The
increase in nonperforming  loans is primarily due to a $14.5 million increase in
loans on nonaccrual status that totaled $18.1 million at June 30, 2002. Loans on
nonaccrual  status  include  $15.3  million of  constructions  loans  secured by
residential  real  estate to a  financially  troubled  builder.  The Company has
performed a detailed review of this credit and, under the information  currently
known by management,  believes no further  provisions for loan losses related to
this credit are  necessary.  Interest  income lost on this group of loans due to
their  nonaccrual  status totaled $302 thousand during the six months ended June
30, 2002. A portion of this total,  $92  thousand,  represents  interest  income
accrued  during  the  first  quarter  of 2002,  before  the loan was  placed  on
nonaccrual  status,  which was  reversed  in the second  quarter of 2002.  It is
currently  estimated that a total of $210 thousand of interest income in each of
the  remaining  quarters of 2002 will be lost  related to this credit  should it
remain on nonaccrual status through year-end 2002.

Other real estate owned,  which had a balance of $715 thousand at year-end 2001,
decreased $391 thousand or 54.7% and totaled $324 thousand on June 30, 2002.

TEMPORARY INVESTMENTS
---------------------

Temporary  investments  consist of interest  bearing  deposits with other banks,
federal funds sold,  and  securities  purchased  under  agreements to resell and
totaled  $128.4  million at June 30,  2002,  an increase of $78.0  million  from
year-end 2001.  Temporary  investments  averaged $60.3 million for the first six
months of 2002, a decrease of $22.5 million from year-end 2001. This decrease is
primarily a result of the  Company's net funding  position and the  relationship
between its principal  subsidiary and the  Commonwealth of Kentucky as described
in preceding sections of this report.  Temporary  investments are reallocated as
loan demand and other investment alternatives present the opportunity.

INVESTMENT SECURITIES
---------------------

Investment  securities were $299.1 million on June 30, 2002, a decrease of $46.4
million or 13.4% from  year-end  2001.  Available  for sale and held to maturity
securities  were $266.7  million  and $32.4  million,  respectively.  Investment
securities averaged $328.0 million for the first six months of 2002, an increase
of $64.8 million or 24.6% from year-end 2001. The increase in average investment
securities is attributable to the Company's  continued efforts to manage its net
interest  margin during a period of  relatively  low market  interest  rates and
correlates  with the increase in borrowed  funds.  The Company had an unrealized
gain on available  for sale  investment  securities  of $2.1 million at June 30,
2002 compared to $1.9 million at year-end 2001.

DEPOSITS
--------

Total  deposits  were  $940.7  million at June 30,  2002,  an  increase of $27.3
million or 3.0% from year-end 2001. Noninterest bearing deposits increased $30.2
million  or 22.2% in the  comparison.  This  increase  is  primarily  due to the
relationship  between the Company's principal subsidiary and the Commonwealth of
Kentucky as  described in preceding  sections of this  report.  Commonwealth  of
Kentucky deposits  increased $27.9 million on June 30, 2002 compared to December
31, 2001. On average,  noninterest  bearing  deposits were $150.1 million during
the current period,  an increase of $1.3 million or 0.9%. End of period interest
bearing  deposit  balances  decreased $2.9 million or 0.4% compared to the prior
year end and are  summarized  as follows:  interest  bearing  checking  accounts
decreased  $2.7  million  to  $209.9  million;  money  market  deposit  accounts
decreased $4.1 million to $99.8 million; savings accounts decreased $7.5 million
to $58.9 million;  and time deposits  increased $11.4 million to $406.0 million.
On  average,  interest  bearing  deposits  were  $781.2  million in the  current
six-month  period, an increase of $33.9 million from year-end 2001. The increase
in average  interest  bearing  deposits is attributable to increases in interest
bearing demand deposits of $16.2 million or 8.1%, time deposits of $16.0 million
or 4.2%,  and money market  deposit  accounts of $3.3  million or 3.3%.  Average
savings deposits  decreased $1.7 million or 2.8%. Total deposits averaged $931.3
million, an increase of $35.2 million or 3.9% from year-end 2001.

BORROWED FUNDS
--------------

Borrowed  funds  totaled  $191.3  million at June 30, 2002, an increase of $53.8
million or 39.1% from year-end 2001. Increases in short-term borrowings of $38.4
million along with an increase in long-term  borrowings of $15.4 million account
for the total increase in borrowed funds. Federal funds purchased and securities
sold under  agreements  to  repurchase  accounted  for most of the  increase  in
borrowed funds with an increase of $31.7 million or 27.8%.  This increase is due
primarily  to  the  overall  funding  needs  of  the  Company  as  well  as  the
relationship  between the Company's principal subsidiary and the Commonwealth of
Kentucky as  described in preceding  sections of this report.  Other  short-term
borrowings  increased  $6.7 million  mainly due to an increase in borrowed funds
from the  Federal  Home  Loan  Bank  ("FHLB").  The $15.4  million  increase  in
long-term  borrowings is  attributed  to additional  advances from the FHLB with
varying  interest rate terms and maturing within 10 years.  Recent FHLB advances
have been used to fund the purchase of additional  investment  securities and to
aid the efforts of asset and liability management. Total borrowed funds averaged
$141.5 million, an increase of $24.5 million or 20.9% from year-end 2001.

LIQUIDITY

The Parent  Company's  primary use of cash consists of dividend  payments to its
common shareholders,  purchases of its common stock, and other general operating
purposes.  Liquidity of the Parent Company  depends  primarily on the receipt of
dividends from its subsidiary banks and cash balances maintained. As of June 30,
2002 combined retained  earnings of the subsidiary banks were $69.1 million,  of
which $17.3  million was  available  for the payment of  dividends to the Parent
Company without  obtaining prior approval from bank  regulatory  agencies.  As a
practical matter, payment of future dividends is also subject to the maintenance
of other capital ratio  requirements.  Management expects that in the aggregate,
its subsidiary banks will continue to have the ability to pay dividends in order
to provide funds to the Parent Company  during the remainder of 2002  sufficient
to meet its  liquidity  needs.  The Parent  Company  had cash  balances  of $8.3
million at June 30, 2002.

The Company's  objective as it relates to liquidity is to insure that subsidiary
banks  have funds  available  to meet  deposit  withdrawals  and credit  demands
without unduly penalizing profitability.  In order to maintain a proper level of
liquidity,  the banks have several  sources of funds available on a daily basis,
which can be used for  liquidity  purposes.  These  sources  of funds  primarily
include the  subsidiary  banks' core  deposits,  consisting of both business and
nonbusiness  deposits;  cash flow  generated by repayment of loan  principal and
interest;  and federal funds purchased and securities  sold under  agreements to
repurchase.  The  terms  of the  recent  FHLB  advances  have  been  taken  into
consideration in relation to the overall funding needs of the Company.

For the longer term, the liquidity position is managed by balancing the maturity
structure of the balance sheet. This process allows for an orderly flow of funds
over an extended  period of time. The Company's  Asset and Liability  Management
Committee  meets  regularly and monitors the composition of the balance sheet to
ensure comprehensive management of interest rate risk and liquidity.

Liquid assets consist of cash, cash  equivalents,  and securities  available for
sale. At June 30, 2002, such assets totaled $511.3 million, an increase of $96.8
million or 23.4% from year-end 2001. The increase in liquid assets is attributed
to the  overall  funding  position  of the  Company  combined  with the  current
interest rate environment.  Net cash provided by operating  activities was $10.7
million in the first six months of 2002,  an increase  of $563  thousand or 5.6%
compared to the same period last year. Net cash provided by investing activities
was $52.8 million, an increase of $73.6 million due primarily to a $51.0 million
decrease in net purchases and calls of available for sale investment securities.
A decrease in loan volume during the six-month periods contributed an additional
$23.9 million in the comparison.  Net cash provided by financing  activities was
$74.7  million  for the period  ended June 30,  2002.  In the same period of the
prior year,  financing  activities  used $70.0  million,  a difference of $144.7
million relating primarily to deposit account activity.

CAPITAL RESOURCES

Shareholders'  equity was $124.8  million on June 30, 2002,  an increase of $1.3
million or 1.0% from year-end 2001. The Company  purchased 91 thousand shares of
its  outstanding  common  stock  during the first six months of 2002 for a total
cost of $3.1 million.

The  Company  issued 47  thousand  shares of common  stock  during the first six
months pursuant to its nonqualified stock option plan. Dividends of $4.3 million
or $.62 per share were declared during the first six months of 2002, an increase
of 3.3% per share compared to the prior year.  Accumulated  other  comprehensive
income,  consisting  of the  unrealized  holding  gain  on  available  for  sale
investment securities (net of tax) increased $152 thousand from year-end 2001.

Consistent with the objective of operating a sound financial  organization,  the
Company's goal is to maintain  capital ratios well above the regulatory  minimum
requirements.  The Company's  capital ratios as of June 30, 2002, the regulatory
minimums and the regulatory standard for a "well capitalized" institution are as
follows:

                          Farmers Capital        Regulatory          Well
                         Bank Corporation          Minimum        Capitalized
------------------------------------------------------------------------------
Tier 1 risk based              16.30%               4.00%            6.00%
Total risk based               17.55%               8.00%           10.00%
Leverage                       10.28%               4.00%            5.00%
------------------------------------------------------------------------------

The capital ratios of all the subsidiary banks, on an individual basis, were in
excess of the applicable minimum regulatory capital ratio requirements at June
30, 2002.

EFFECT OF IMPLEMENTING RECENTLY ISSUED ACCOUNTING STANDARDS

Effective  January 1, 2002, the Company adopted Financial  Accounting  Standards
Board ("FASB")  Statement of Financial  Accounting  Standards  ("SFAS") No. 142,
GOODWILL AND OTHER  INTANGIBLE  ASSETS.  SFAS No. 142 requires that goodwill and
intangible  assets with  indefinite  useful  lives no longer be  amortized,  but
instead  be tested for  impairment  at least  annually  in  accordance  with the
provisions of Statement 142.  Statement 142 also requires that intangible assets
with definite useful lives be amortized over their  respective  estimated useful
lives  to their  estimated  residual  values  and  reviewed  for  impairment  in
accordance with SFAS No. 121, ACCOUNTING FOR THE IMPAIRMENT OF LONG-LIVED ASSETS
AND FOR  LONG-LIVED  ASSETS TO BE DISPOSED  OF. The adoption of SFAS No. 142 did
not have an effect on the consolidated financial statements of the Company.

Effective January 1, 2002, the Company adopted SFAS No. 144,  ACCOUNTING FOR THE
IMPAIRMENT  OR  DISPOSAL  OF  LONG-LIVED  ASSETS,   which  addresses   financial
accounting  and reporting for the  impairment or disposal of long-lived  assets.
While SFAS No. 144  supersedes  SFAS No. 121,  ACCOUNTING  FOR THE IMPAIRMENT OF
LONG-LIVED  ASSETS AND FOR LONG-LIVED  ASSETS TO BE DISPOSED OF, it retains many
of the fundamental provisions of that Statement.

SFAS No.  144  also  supersedes  the  accounting  and  reporting  provisions  of
Accounting   Principles   Board  Opinion  No.  30,   REPORTING  THE  RESULTS  OF
OPERATIONS-REPORTING  THE EFFECTS OF  DISPOSAL OF A SEGMENT OF A BUSINESS,  AND
EXTRAORDINARY,  UNUSUAL AND INFREQUENTLY OCCURRING EVENTS AND TRANSACTIONS,  for
the disposal of a segment of a business.  However, it retains the requirement in
Opinion No. 30 to report  separately  discontinued  operations  and extends that
reporting to a component of an entity that either has been disposed of (by sale,
abandonment,  or in a distribution to owners) or is classified as held for sale.
By  broadening  the  presentation  of  discontinued  operations  to include more
disposal  transactions,  the FASB has enhanced  management's  ability to provide
information  that helps  financial  statement  users to assess the  effects of a
disposal  transaction  on the ongoing  operations of an entity.  The adoption of
SFAS No. 144 did not have an effect on the consolidated  financial statements of
the Company.

In April 2002, the FASB issued SFAS No. 145,  RESCISSION OF FASB  STATEMENTS NO.
4, 44, AND 64,  AMENDMENT OF FASB  STATEMENT NO. 13, AND TECHNICAL  CORRECTIONS.
This Statement  rescinds FASB  Statement No. 4, REPORTING  GAINS AND LOSSES FROM
EXTINGUISHMENT  OF DEBT, and an amendment of that Statement,  FASB Statement No.
64,  EXTINGUISHMENTS  OF DEBT MADE TO SATISFY  SINKING-FUND  REQUIREMENTS.  This
Statement also rescinds FASB Statement No. 44,  ACCOUNTING FOR INTANGIBLE ASSETS
OF MOTOR CARRIERS.  This Statement amends FASB Statement No. 13,  ACCOUNTING FOR
LEASES,  to  eliminate an  inconsistency  between the  required  accounting  for
sale-leaseback  transactions  and the  required  accounting  for  certain  lease
modifications  that have  economic  effects  that are similar to  sale-leaseback
transactions.   This  Statement   also  amends  other   existing   authoritative
pronouncements  to make various  technical  corrections,  clarify  meanings,  or
describe their applicability  under changed  conditions.  The provisions of SFAS
No. 145  related to SFAS No. 4 and SFAS No. 13 are  effective  for fiscal  years
beginning and transactions occurring after May 15, 2002, respectively. All other
provisions of this Statement are effective for financial statements issued on or
after May 15,  2002.  The  adoption of this  Statement  will not have a material
effect on the Company's consolidated financial statements.

In July 2002, the FASB issued SFAS No. 146, ACCOUNTING FOR COSTS ASSOCIATED WITH
EXIT OR DISPOSAL ACTIVITIES.  This Statement requires that a liability for costs
associated  with an exit or disposal  activity to be  recognized  when  incurred
rather than at the date  commitment to an exit or disposal plan.  This Statement
replaces  EITF  94-3  and is to be  applied  prospectively  to exit or  disposal
activities  initiated  after  December 31, 2002.  The adoption of this Statement
will  not  have a  material  effect  on  the  Company's  consolidated  financial
statements.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
-------------------------------------------------------------------

The Company uses a simulation  model as a tool to monitor and evaluate  interest
rate risk  exposure.  The model is designed to measure  the  sensitivity  of net
interest  income and net income to  changing  interest  rates over  future  time
periods.  Forecasting  net  interest  income and its  sensitivity  to changes in
interest  rates  requires the Company to make  assumptions  about the volume and
characteristics  of  many  attributes,  including  assumptions  relating  to the
replacement  of  maturing  earning  assets and  liabilities.  Other  assumptions
include,  but are not limited to, projected  prepayments,  projected new volume,
and the predicted  relationship  between  changes in market  interest  rates and
changes in  customer  account  balances.  These  effects are  combined  with the
Company's  estimate of the most likely rate environment to produce a forecast of
net interest income and net income. The forecasted results are then adjusted for
the effect of a gradual  increase and decrease in market  interest  rates on the
Company's net interest income and net income. Because assumptions are inherently
uncertain, the model cannot precisely estimate net interest income or net income
or the effect of interest  rate changes on net  interest  income and net income.
Actual results could differ significantly from simulated results.

At June 30, 2002, the model  indicated that if rates were to gradually  increase
by 150 basis points during the remainder of the calendar year, then net interest
income and net income would decrease 0.66% and 1.62%, respectively, for the year
ending  December 31, 2002.  The model  indicated that if rates were to gradually
decrease by 150 basis points over the same period,  then net interest income and
net income would decrease 0.20% and 0.41%, respectively.

PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS
--------------------------

In the case of EARL H. SHILLING ET AL. V. FARMERS BANK & Capital Trust  Company,
on May 10, 2002,  the Kentucky Court of Appeals  affirmed the Jefferson  Circuit
Court's judgment in favor of the Bank. The plaintiff  bondholders filed a motion
for  discretionary  review  to the  Supreme  Court  on June 7,  2002.  It is not
possible  at this  stage of the  proceedings  to make any  prediction  as to the
outcome,  however the Supreme Court must grant the plaintiff bondholders' motion
to review the appeal,  or the affirmed judgment in favor of the Bank will become
the final outcome of the case.

There were various  other  pending  legal  actions and  proceedings  against the
Company  arising  from the normal  course of  business  and in which  claims for
damages are asserted.  Management, after discussion with legal counsel, believes
that these actions are without merit and that the ultimate  liability  resulting
from these  legal  actions  and  proceedings,  if any,  will not have a material
adverse effect upon the consolidated financial statements of the Company.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
------------------------------------------------------------

The annual meeting of shareholders  was held May 14, 2002. The matters that were
voted upon included the election of four directors for  three-year  terms ending
in 2005 or until their successors have been elected and qualified.

The outcome of the voting was as follows:
NAME                            FOR         AGAINST      WITHHELD      ABSTAINED
Gerald R. Hignite            5,609,477         0           1,982        110,115
G. Anthony Busseni           5,445,249         0         166,210        110,115
Shelley S. Sweeney           5,609,477         0           1,982        110,115
Michael M. Sullivan          5,609,669         0           1,790        110,115

Listed below are the names of each director whose term of office continued after
the meeting.

Lloyd C. Hillard, Jr.            J. Barry Banker
Harold G. Mays                   W. Benjamin Crain
Robert Roach, Jr.                Glenn Birdwhistell
Frank W. Sower, Jr.

In addition to the directors above, Dr. John P. Stewart,  Chairman Emeritus,  E.
Bruce  Dungan,  and  Charles T.  Mitchell  serve as advisory  directors  for the
Company.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K
-----------------------------------------

a)       List of Exhibits
         ----------------

11       Statement re computation of per share earnings
99.1     CEO Certification
99.2     CFO Certification

b)       Reports on Form 8-K
         -------------------

         None.
SIGNATURES

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

Date:    8-8-02                     /s/ G. Anthony Busseni
       -----------------------      --------------------------------------------
                                    G. Anthony Busseni,
                                    President and CEO
                                    (Principal Executive Officer)

Date:    8-8-02                     /s/ C. Douglas Carpenter
       -----------------------      --------------------------------------------
                                    C. Douglas Carpenter,
                                    Vice President, Secretary, and CFO
                                    (Principal Financial and Accounting Officer)
Exhibit 11
                 STATEMENT RE COMPUTATION OF PER SHARE EARNINGS
                 ----------------------------------------------

--------------------------------------------------------------------------------
                                           Three Months             Six Months
                                               Ended                  Ended
                                              June 30                June 30
(In thousands, except per share data)     2002      2001         2002       2001
--------------------------------------------------------------------------------

Net income, basic and diluted           $3,316    $3,896       $7,098     $7,802
--------------------------------------------------------------------------------

Average shares outstanding               6,889     6,949        6,895      7,023
Effect of dilutive stock options            52        29           48         27
--------------------------------------------------------------------------------
Average diluted shares outstanding       6,941     6,978        6,943      7,050
--------------------------------------------------------------------------------

Net income per share, basic             $  .48    $  .56       $ 1.03     $ 1.11
Net income per share, diluted              .48       .56         1.02       1.11
--------------------------------------------------------------------------------
Exhibit 99.1

                        CERTIFICATION OF PERIODIC REPORT
                        --------------------------------

I, G. Anthony Busseni, President and Chief Executive Officer of Farmers Capital
Bank Corporation, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of
2002, 18 U.S.C. Section 1350, that:

     1)   the  Quarterly  Report on Form 10-Q of the Company  for the  quarterly
          period  ended June 30, 2002 (the  "Report")  fully  complies  with the
          requirements of Section 13(a) or 15(d) of the Securities  Exchange Act
          of 1934; and

     2)   the  information  contained  in the  Report  fairly  presents,  in all
          material respects,  the financial  condition and results of operations
          of the Company.

Date:     8-8-02                          /s/ G. Anthony Busseni
       ---------------------------        --------------------------------------
                                          G. Anthony Busseni
                                          President and CEO
Exhibit 99.2

                        CERTIFICATION OF PERIODIC REPORT
                        --------------------------------

I, C. Douglas Carpenter, Vice President,  Secretary, and Chief Financial Officer
of Farmers  Capital Bank  Corporation,  certify,  pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

     1)   the  Quarterly  Report on Form 10-Q of the Company  for the  quarterly
          period  ended June 30, 2002 (the  "Report")  fully  complies  with the
          requirements of Section 13(a) or 15(d) of the Securities  Exchange Act
          of 1934; and

     2)   the  information  contained  in the  Report  fairly  presents,  in all
          material respects,  the financial  condition and results of operations
          of the Company.

Date:   8-8-02                           /s/ C. Douglas Carpenter
      ---------------------------        ---------------------------------------
                                         C. Douglas Carpenter
                                         Vice President, Secretary, and CFO