Bank of Kentucky Financial (BKYF) 8-K Announces First Quarter Earnings

Exhibit 99.1

NEWS RELEASE

THE BANK OF KENTUCKY FINANCIAL CORPORATION

ANNOUNCES FIRST QUARTER EARNINGS

Net Interest Income drives 10% Growth in Earnings.

CRESTVIEW HILLS, KENTUCKY, April 21, 2005 – The Bank of Kentucky Financial Corporation (the “Company”) (OTC/BB: BKYF), the holding company of the Bank of Kentucky, Inc., today reported its earnings for the first quarter of 2005. Net income increased 10% to $2,545,000 and diluted earnings per share increased 13% to $0.43 per share, as compared to the same period in 2004. Highlighting first quarter results was a 12% ($847,000) increase in net interest income from the first quarter of 2004. This increase offset the 46% ($148,000) reduction in gains on the sale of mortgage loans for the same period.

A summary of the Company’s interim results follows:

First Quarter ended March 31,	2005		2004		Change
Net income	$	2,545,000	$	2,311,000	10	%
Net income per share, basic	$	0.43	$	0.39	10	%
Net income per share, diluted	$	0.43	$	0.38	13	%

Net interest income increased $847,000 or 12% in the first quarter of 2005, as compared to the same period in 2004. The increase was both the result of the increase in loans outstanding and a favorable rate variance from the first quarter of 2004. This growth and favorable rate environment helped increase the net interest margin from 3.92% in the first quarter of 2004 to 4.09% in the first quarter of 2005.

Non-interest income was up 1% ($13,000) in the first quarter of 2005 compared to the same period in 2004, while non-interest expense increased 9% ($485,000) from the same period last year. Increases in bankcard transaction revenue (up $94,000, 63%) and fees from the issuance of standby letters of credit (up $86,000, 532%) were offset with lower gains on the sale of mortgage loans (down $148,000, 46%) and lower service charge income (down $55,000, 7%). Rising interest rates slowed mortgage loan refinancing and reduced gains on the sale of mortgage loans. Rising interest rates also contributed to the decrease in service charge revenue, as the earnings credit rate used to offset service charges increased. The largest increases in non-interest expense were salaries and employee benefits expense (up $220,000, 9%) and occupancy and equipment expense (up $106,000, 13%). These non-interest expense increases were due in part to the opening of the Bank’s cash management operations center in February.

Total assets were $880 million at the end of the first quarter of 2005, which was $61 million or 7% higher than the same date a year ago. Total loans grew $56 million or 8% from March of 2004 and were funded by an increase in deposits of $35 million or 5% and increases in borrowings and stockholders’ equity of $18 million or 37% and $6 million or 9% respectively, from the end of the first quarter of 2004.

The Bank of Kentucky Financial Corporation

Selected Consolidated Financial Data

(Dollars in thousands, except per share data)

	Four Quarter Comparison												First Quarter Comparison
Income Statement Data	3/31/05			12/31/04			9/30/04			6/30/04			3/31/05			3/31/04			% Change
Net interest income	$	7,911		$	7,881		$	7,714		$	7,334		$	7,911		$	7,064		12	%
Provision for loan losses		350			500			500			350			350			325		8	%
Service charges on deposit accounts		791			894			994			946			791			846		(7	)%
Gains on the sale of mortgage loans		175			256			222			480			175			323		(46	)%
Other non-interest income		955			985			805			781			955			739		29	%
Salaries and employee benefits expense		2,757			2,601			2,655			2,593			2,757			2,537		9	%
Occupancy and equipment expense		941			860			868			794			941			835		13	%
Other non-interest expense		2,001			2,068			2,034			1,915			2,001			1,842		9	%
Net income		2,545			2,680			2,465			2,602			2,545			2,311		10	%
Per Share Data
Basic earnings per share	$	0.43		$	0.45		$	0.42		$	0.44		$	0.43		$	0.39		10	%
Diluted earnings per share		0.43			0.45			0.41			0.43			0.43			0.38		13	%
Cash dividends declared		0.14			0.00			0.12			0.00			0.14			0.11		27	%
Earnings Performance Data
Return on equity		13.83	%		14.70	%		14.09	%		15.07	%		13.83	%		13.66	%	17bps
Return on assets		1.18	%		1.23	%		1.17	%		1.27	%		1.18	%		1.15	%	3bps
Net interest margin		4.09	%		4.00	%		4.05	%		3.99	%		4.09	%		3.92	%	17bps
Balance Sheet Data	3/31/05			12/31/04			9/30/04			6/30/04			3/31/05			3/31/04			% Change
Investments	$	60,632		$	64,266		$	48,633		$	50,233		$	60,632		$	48,896		24	%
Total loans		727,525			719,157			712,275			692,025			727,525			671,794		8	%
Allowance for loan losses		7,320			7,214			7,385			7,180			7,320			7,017		4	%
Total assets		880,200			878,129			853,444			833,204			880,200			819,209		7	%
Total deposits		731,479			752,800			708,486			696,936			731,479			696,196		5	%
Total borrowings		68,637			46,734			68,656			62,238			68,637			50,243		37	%
Stockholders’ equity		74,547			73,664			71,084			69,687			74,547			68,345		9	%
Asset Quality Data
Allowance for loan losses to total loans		1.01	%		1.00	%		1.04	%		1.04	%		1.01	%		1.04	%
Non-performing loans to total loans		.72	%		.72	%		.61	%		.48	%		.72	%		.53	%
Annualized charge-offs to average loans		.14	%		.19	%		.17	%		.11	%		.14	%		.10	%

About BKFC

BKFC, a bank holding company with assets of approximately $880 million, offers banking and related financial services to both individuals and business customers. BKFC operates twenty-six branch locations and thirty-seven ATM’s in the Northern Kentucky market.

For more information contact:

Martin Gerrety

Senior Vice President and CFO

(859) 372-5169

mgerrety@bankofky.com

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