August 15, 2005

Kentucky Bank Names Bourbon County Regional Board Members

Kentucky Bank has named three members to the Bourbon County Regional Board. Each market in which the bank operates has its own regional board. The purpose of the Board is to create business opportunities within those respective communities. The regional directors named are Proctor Blair, CPA; Allyson Eads, Co-owner and Co-operator of Eads Hardware; and Shackelford Parrish, Clay Ward Agency, LLC and Indian Creek Farm.

Proctor W. Blair graduated from Bourbon County High School and the University of Kentucky. Mr. Blair is a partner with the accounting firm of Ludwig, Blair and Bush, PLLC. He is a member of the Kentucky State Board of Accounting and the Kentucky Society of CPA’s. He is also a financial representative of Northwestern Mutual Financial Network and a partner in Executive Benefits Specialists of Kentucky. Mr. Blair is a member of the Bluegrass Chapter of Life Underwriters and life member of the Million Dollar Round Table. Mr. Blair is past President and current board member of the Paris-Bourbon County YMCA. He has served as President of the Bourbon-Nicholas County UK Alumni Club since 1990. Mr. Blair is a board member and treasurer of the Stoner Creek Country Club. The Blairs have two teenage daughters.

Allyson Eads, along with her husband David, have owned and operated Eads Hardware for the past twenty years. They have stores located in Cynthiana, Mt. Sterling and Paris. The Eadses, along with their two sons, are actively involved in the businesses. Allyson also serves on the advisory board of The House Hasson Hardware Company, a wholesale hardware supplier. Their business goals include offering the best service and product lines available. The Eads family includes two sons and two grandsons.

Shackelford Parrish, III is President of Clay Ward Agency, LLC and Indian Creek Farm. Upon graduating from Transylvania University, Shack joined the United States Air Force. In 1974, he joined the family business, the Clay Ward Agency. He has overseen the Indian Creek farm operations for more than two decades. Shack has served Bourbon County as past president of the Paris Rotary Club and as past president for the board of directors of the Paris YMCA. Shack is also a graduate of the United States Soccer Coaches Association School of Coaching. Mr. Parrish is a native of Bourbon County.

Kentucky Bank has offices in Georgetown, Nicholasville, Winchester, Paris, Versailles, Wilmore, Cynthiana and North Middletown. Kentucky Bank’s headquarters are located in Paris.

July 18, 2005

We are very pleased to report that our earnings per share on a diluted basis increased 14% over the first six months of 2005. This trend is a continuation of the positive earnings that Kentucky Bancshares experienced for the entire year of 2004.

Our net income for the second quarter was $1.5 million, or 56 cents per share after the effects of dilution. This is up by 10% from the results last year. For the same period in 2004, earnings were $1.4 million, or 51 cents per share. For this year to date we have now earned $1.05 per share versus 92 cents last year.

You will notice that our loans are up by 9.6% and deposits are up by 1.6% from a year ago. Much of this results from the relative economic strength of the markets that we currently serve. Credit quality remains good as reflected by both past dues and loan losses.

Our net interest margin continues to be something we constantly address. This is partly due to competitive pressures as more banks are continuing to open offices in the markets in which we already operate. This increases competition, but also validates our view that these are growing and very attractive communities in which to do business. The second factor contributing to the net interest margin issue is the growing need banks have for deposits in these markets. It is our anticipation that as interest rates continue to rise, pressure on our margin will ease somewhat.

Kentucky Bank’s Bourbon Region, under the direction of Vice President Nancye Fightmaster, welcomes a new board of directors. Directors joining the board are Proc Blair of Ludwig, Blair & Bush CPA; Allyson Eads of Eads Hardware; Clay Holderman, CEO Bourbon Community Hospital and Shack Parrish of Clay Ward Agency.

Kentucky Bank has headquarters in Paris with offices in six other communities: Cynthiana, Georgetown, Nicholasville, North Middletown, Versailles, Wilmore and Winchester.

June 2, 2005

Kentucky Bank announces $10 million payments for USDA tobacco contracts

Kentucky Bank announces today a $10 million commitment to make lump sum payments to purchase contracts related to the tobacco buyout program. For former quota holders and producers, the USDA has promised a schedule of annual payments from 2005 through 2014. The bank offers you the opportunity to exchange your rights for a payment amount that can be determined immediately. The offer expires whenever the $10 million amount is exhausted.

The lump sum amount is discounted because the money is received earlier than called for with USDA 10 year schedule. Kentucky Bank’s base offer is determined by the amount of the USDA contract and ranges from 75 to 80 per cent. The bank does reserve the right to change its offer at any time.

“ The tobacco buyout funds are crucial to farmers in Central Kentucky,” said Kentucky Bank President Louis Prichard. “ We are very pleased to announce Kentucky Bank’s $10 million commitment to offer lump settlements for those who prefer to make that choice. Some farmers with good reason may want to receive their funds over the promised 10 year period. Others for equally good reasons may want to exchange that stream of payments for a lump sum today. We have a very fair offer for those who want to receive their benefits in one lump sum.”

Kentucky Bank Regional Manager Nick Carter offered further comments. “ I’m really glad our bank has taken this step. Kentucky Bank has always valued its long term relationship with the farming community in Central Kentucky. For some the opportunity to have all the money available soon rather than over time helps them. This is a chance to provide a service that can really help those with a current need or opportunity.”

The bank is prepared to enter agreements immediately. The 2005 payment is not included in the lump sum agreement. The bank will purchase the stream of 9 payments due from 2006 through 2014. The lump sum payment to you will be made on January 3, 2006. However the amount of the payment will be determined now, upon execution of the lump sum agreement between the customer and the bank. In order to receive the payment, the customer’s contract and successor in interest form must be approved by the local farm service agency office.

Kentucky Bank has offices in six counties in Central Kentucky—Bourbon, Clark, Harrison, Jessamine, Scott and Woodford. The bank is headquartered in Paris.

February 22, 2005

Kentucky Bank Parent Increases Dividend

Kentucky Bancshares, Inc., parent holding company for Kentucky Bank, announced today an increase in the quarterly dividend to shareholders. The payout will be 23 cents per share, up from 21 cents for each of the previous four quarters. This payment will be made March 31 to shareholders of record March 18, 2005. The company has a record of increasing its dividend each year since 1982.

Kentucky Bancshares President Buckner Woodford made the announcement. “ This marks 23 consecutive years we have been able to increase the dividend. I want to thank all our employees for effort they make and service they provide our customers. We value the relationship we have with our customers. Our bank wouldn’t exist without them.”

Kentucky Bank has offices in Paris, Winchester, Georgetown, Versailles, Nicholasville, Wilmore, Cynthiana and North Middletown, all small communities that surround Lexington. At year-end assets totaled $529 million. It ranks 11th in size among the state’s 218 banks. Shares of the parent holding company trade over the counter and are reported on the OTC Bulletin Board. The symbol is KTYB.OB.
 

February 9, 2005