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Kentucky Banking Centers, Inc.

Glasgow, KY · Cert 5855

FDIC

Q3 2006

$124.4MAssets
$81.4MLoans
$112.4MDeposits
$9.7MEquity
Loan mix
89%RE $34.9M11%C&I $4.3M0%Consumer $0.1MQ3 2005Q3 2006
Deposit mix
90%Interest-bearing $101.6M10%Noninterest $10.8MQ3 2005Q3 2006

NIM

4.77%Q3 ’045.84%Q3 ’056.69%Q3 ’06+26%+9%

Non-interest income vs. expense

2.75%Q3 ’042.96%Q3 ’053.01%Q3 ’06+20%+2%

Executive Summary

  • Earnings: ROA of 1.10%, up 1 bps year over year; NIM at 3.97%.
  • Asset quality: problem loans at 0.00% of loans (0 bps YoY), with net charge-offs at 0.53%.
  • Funding: loans stand at 72.44% of deposits as of Q3 2006.

Financial Results

Return on Assets (quarter, annualized)

1.10%+1 bps YoY

Net Interest Margin (quarter, annualized)

3.97%+33 bps YoY

Efficiency Ratio (quarter, annualized)

62.21%-373 bps YoY

Tier 1 Leverage Ratio

n/a

Discrete quarter, annualized.

MetricQ3 2005Q4 2005Q1 2006Q2 2006Q3 2006YoY ΔTrend
Earnings
Return on Assets1.08%0.73%1.03%1.12%1.10%+1 bps
Return on Equity13.47%9.46%13.88%14.98%14.66%+119 bps
Net Interest Margin3.64%3.50%3.62%3.89%3.97%+33 bps
Efficiency Ratio65.94%67.01%74.05%68.65%62.21%-373 bps
Non-Interest Burden2.11%2.10%2.45%2.39%2.15%+4 bps
Growth
Asset Growth (YoY)-6.66%-7.82%-7.09%1.45%2.43%+909 bps
Loan Growth (YoY)-0.14%-0.07%-1.66%2.02%-0.69%-55 bps
Deposit Growth (YoY)-7.76%-6.76%-7.66%2.32%3.32%+1,108 bps
Asset Quality
Nonperforming Loans / Loans0.00%0.00%0.00%0.00%0.00%0 bps
Net Charge-Offs / Loans0.13%0.77%-0.24%-0.07%0.53%+40 bps
Allowance / Loans1.50%1.46%1.45%1.40%1.37%-13 bps
Allowance Coverage of NPLsn/an/an/an/an/an/an/a
Capital
Tier 1 Leverage Ration/an/an/an/an/an/an/a
Total Risk-Based Capital13.32%12.12%12.75%11.98%12.53%-79 bps
Equity / Assets8.28%7.19%7.73%7.24%7.77%-51 bps
Liquidity & Funding
Loans / Deposits75.36%71.00%72.72%72.86%72.44%-292 bps
Liquid Assets / Assets1.58%1.37%1.28%1.02%1.00%-58 bps
CRE / Total Capitaln/an/an/an/an/an/an/a