SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )

Filed by the Registrant /X/
Filed by a Party other than the Registrant / /

Check the appropriate box:

/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12

CLASSIC BANCSHARES, INC.
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(Name of Registrant as Specified in Its Charter)

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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

/X/ No fee required
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

1) Title of each class of securities to which transaction applies:

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2) Aggregate number of securities to which transaction applies:

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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):

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4) Proposed maximum aggregate value of transaction:

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5) Total fee paid:

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/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.

1) Amount Previously Paid:

___________________________________________________________________________
2) Form, Schedule or Registration Statement No.:

___________________________________________________________________________
3) Filing Party:

___________________________________________________________________________
4) Date Filed:

___________________________________________________________________________

June 27, 1997

Dear Fellow Stockholder:

On behalf of the Board of Directors and management of Classic
Bancshares, Inc., I cordially invite you to attend the 1997 Annual Meeting of
Stockholders. The meeting will be held at 3:00 p.m. on July 28, 1997, at the
corporate headquarters of RAM Technologies, Inc., located at 1516 Bath Avenue,
Ashland, Kentucky.

An important aspect of the meeting process is the stockholder vote on
corporate business items. I urge you to exercise your rights as a stockholder to
vote and participate in this process. Stockholders are being asked to consider
and vote upon the election of four directors and the ratification of the
appointment of independent auditors. The Board has carefully considered each of
the nominees and the appointment of the independent auditors. Accordingly, your
Board of Directors unanimously recommends that you vote for the director
nominees and the appointment of the independent auditors.

In addition to the annual stockholder vote on corporate business items,
the meeting will include management's report to you on Classic Bancshares,
Inc.'s fiscal 1997 financial and operating performance.

I encourage you to attend the meeting in person. Whether or not you
attend the meeting, I hope that you will read the enclosed Proxy Statement and
then complete, sign and date the enclosed proxy card and return it in the
postage prepaid envelope provided. This will save Classic Bancshares, Inc.
additional expense in soliciting proxies and will ensure that your shares are
represented. Please note that you may vote in person at the meeting even if you
have previously returned the proxy.

Thank you for your attention to this important matter.

Sincerely,

David B. Barbour
President and Chief Executive Officer

CLASSIC BANCSHARES, INC.
344 Seventeenth Street
Ashland, Kentucky 41101
(606) 325-4789

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To be Held on July 28, 1997

Notice is hereby given that the Annual Meeting of Stockholders (the
"Meeting") of Classic Bancshares, Inc. ("Classic" or the "Company") will be held
at the corporate headquarters of RAM Technologies, Inc., located at 1516 Bath
Avenue, Ashland, Kentucky at 3:00 p.m., Ashland, Kentucky time, on July 28,
1997.

A Proxy Card and a Proxy Statement for the Meeting are enclosed.

The Meeting is for the purpose of considering and acting upon:

1. The election of four directors of the Company;

2. The ratification of the appointment of Smith, Goolsby, Artis &
Reams, P.S.C. as the auditors of the Company for the fiscal year
ending March 31, 1998;

and such other matters as may properly come before the Meeting, or any
adjournments thereof. The Board of Directors is not aware of any other business
to come before the Meeting.

Any action may be taken on the foregoing proposals at the Meeting on
the date specified above, or on any date or dates to which the Meeting may be
adjourned. Stockholders of record at the close of business on June 16, 1997 are
the stockholders entitled to vote at the Meeting and any adjournments thereof. A
complete list of stockholders entitled to vote at the Meeting will be available
for inspection by stockholders at the offices of the Company during its normal
business hours of 9:00 a.m. and 4:00 p.m. during the ten days prior to the
Meeting, as well as at the Meeting.

You are requested to complete and sign the enclosed form of proxy,
which is solicited on behalf of the Board of Directors, and to mail it promptly
in the enclosed envelope. The proxy will not be used if you attend and vote at
the Meeting in person.

BY ORDER OF THE BOARD OF DIRECTORS

C. Cyrus Reynolds
Chairman of the Board

Ashland, Kentucky
June 27, 1997

IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY THE EXPENSE OF
FURTHER REQUESTS FOR PROXIES TO ENSURE A QUORUM AT THE MEETING. A SELF-
ADDRESSED ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF
MAILED WITHIN THE UNITED STATES.

PROXY STATEMENT

CLASSIC BANCSHARES, INC.
344 Seventeenth Street
Ashland, Kentucky 41101
(606) 325-4789

ANNUAL MEETING OF STOCKHOLDERS
July 28, 1997

This Proxy Statement is furnished in connection with the solicitation
on behalf of the Board of Directors of Classic Bancshares, Inc. ("Classic" or
the "Company"), the parent company of Classic Bank and The First National Bank
of Paintsville ("Paintsville Bank") of proxies to be used at the Annual Meeting
of Stockholders of the Company (the "Meeting") which will be held at the
corporate headquarters of RAM Technologies, Inc., located at 1516 Bath Avenue,
Ashland, Kentucky on July 28, 1997, at 3:00 p.m., Ashland, Kentucky time, and
all adjournments of the Meeting. The accompanying Notice of Annual Meeting and
form of proxy and this Proxy Statement are first being mailed to stockholders on
or about June 27, 1997.

At the Meeting, stockholders of the Company are being asked to consider
and vote upon the election of four directors and the ratification of the
appointment of Smith, Goolsby, Artis & Reams, P.S.C. as auditors for the
Company.

Vote Required and Proxy Information

All shares of the Company's Common Stock, par value $.01 per share (the
"Common Stock"), represented at the Meeting by properly executed proxies
received prior to or at the Meeting, and not revoked, will be voted at the
Meeting in accordance with the instructions thereon. If no instructions are
indicated, properly executed proxies will be voted for the director nominees and
the proposals set forth in this Proxy Statement. The Company does not know of
any matters, other than as described in the Notice of Annual Meeting, that are
to come before the Meeting. If any other matters are properly presented at the
Meeting for action, the persons named in the enclosed form of proxy and acting
thereunder will have the discretion to vote on such matters in accordance with
their best judgment.

Directors shall be elected by a plurality of the votes cast. The
ratification of the appointment of Smith, Goolsby, Artis & Reams, P.S.C. as
auditors for the Company requires the affirmative vote of a majority of the
votes cast on the matter. Proxies marked to abstain with respect to a proposal
have the same effect as votes against the proposal. Votes withheld (for the
election of directors) and broker non-votes have no effect on the vote.
One-third of the shares of the Common Stock, present in person or represented by
proxy, shall constitute a quorum for purposes of the Meeting. Abstentions and
broker non-votes are counted for purposes of determining a quorum.

A proxy given pursuant to the solicitation may be revoked at any time
before it is voted. Proxies may be revoked by: (i) filing with the Secretary of
the Company at or before the Meeting a written notice of revocation bearing a
later date than the proxy, (ii) duly executing a subsequent proxy relating to
the same shares and delivering it to the Secretary of the Company at or before
the Meeting, or (iii) attending the Meeting and voting in person (although
attendance at the Meeting will not in and of itself constitute revocation of a
proxy). Any written notice revoking a proxy should be delivered to Secretary,
Classic Bancshares, Inc., 344 Seventeenth Street, Ashland, Kentucky 41101.

Voting Securities and Certain Holders Thereof

Stockholders of record as of the close of business on June 16, 1997
will be entitled to one vote for each share of Common Stock then held. As of
that date, the Company had 1,304,950 shares of Common Stock issued and
outstanding. The following table sets forth information regarding share
ownership of those persons or entities known by management to beneficially own
more than five percent of the Common Stock and all directors and executive
officers of the Company as a group.

Shares
Beneficially Percent
Beneficial Owner Owned of Class
- -------------------------------------------------------------------------------------------------------------------
Classic Bancshares, Inc. Employee Stock Ownership Plan 105,800(1) 8.1%
344 Seventeenth Street
Ashland, Kentucky 41101

Societe Generale Asset Management Corp. 101,000(2) 7.6
1221 Avenue of the Americas
New York, New York 10020

Directors and executive officers of the Company as a group 149,131(3) 11.4
(11 persons)

- --------------------------

(1) The amount reported represents shares held by the Employee Stock Ownership
Plan ("ESOP"), 13,934 of which have been allocated to accounts of
participants. First Bankers Trust Company, N.A., Quincy, Illinois, the
trustee of the ESOP, may be deemed to beneficially own the shares held by
the ESOP which have not been allocated to accounts of participants.
Participants in the ESOP are entitled to instruct the trustee as to the
voting of shares allocated to their accounts under the ESOP. Unallocated
shares held in the ESOP's suspense account or allocated shares for which
no voting instructions are received are voted by the trustee in the same
proportion as allocated shares voted by participants.

(2) As reported by Societe Generale Asset Management Corp., a registered
investment adviser ("Societe"), in a statement as of December 31, 1996 on
a Schedule 13G under the Securities Exchange Act of 1934, as amended. Of
this amount, Societe reported that it had sole voting and dispositive powers
as to no shares and shared voting and dispositive powers as to 101,000
shares with SoGen International Fund, Inc., a registered investment company
and a client of Societe,("SoGen") and Societe's other investment advisory
clients. Of the 101,000 shares, SoGen reported on the Schedule 13G that it
had sole voting and dispositive powers as to no shares and shared voting
and dispositive powers as to 88,000 shares with Societe.

(3) Amount includes shares held directly, as well as shares held jointly with
family members, shares held in retirement accounts, 8,593 shares allocated
to the ESOP accounts of the group members, shares held in a fiduciary
capacity or by certain family members, with respect to which shares the
group members may be deemed to have sole or shared voting and/or investment
power. The amount reported above also includes 8,595 shares of restricted
stock awarded under the Company's 1996 Recognition and Retention Plan (the
"RRP") that will vest within 60 days of June 16, 1997 and 22,928 shares
subject to options which will become exercisable within 60 days of June 16,
1997, awarded under the Company's 1996 Stock Option and Incentive Plan (the
"Stock Option Plan").

PROPOSAL I - ELECTION OF DIRECTORS

The Company's Board of Directors is presently composed of nine members.
Directors of the Company are generally elected to serve for a three-year term or
until their respective successors shall have been elected and shall qualify.
Robert L. Bayes, however, has been nominated to serve a two-year term to join
the class of directors with terms to expire in 1999. Approximately one-third of
the directors are elected annually. Each member of the Company's Board of
Directors has served on the Board since the incorporation of the Company in
September 1995, except for Directors Bayes and Jeffrey P. Lopez, each of whom
joined the Board in November 1996.

The following table sets forth certain information regarding the
Company's Board of Directors, including their terms of office and the nominees
for election as directors. It is intended that the proxies solicited on behalf
of the Board of Directors (other than proxies in which the vote is withheld as
to the nominee) will be voted at the Meeting for the election of the nominees
identified in the following table. If any nominee is unable to serve, the shares
represented by all such proxies will be voted for the election of such
substitute or substitutes as the Board of Directors may recommend. At this time,
the Board of Directors knows of no reason why any nominee might be unable to
serve, if elected. Except as described herein, there are no arrangements or
understandings between any director or nominee and any other person pursuant to
which such director or nominee was selected.

Shares of Common
Stock Beneficially Percent
Director Term to Owned at of
Name Age(1) Position(s) Held Since (2) Expire June 16, 1997(3) Class
- ---------------------------------------------------------- ------------------------- -------------------- -------

NOMINEES
E. B. Gevedon, Jr. 63 Director 1980 2000 21,583(4) 1.7%
Robert A. Moyer, Jr. 51 Director 1993 2000 11,583 .9
John W. Clark 55 Director 1995 2000 19,694 1.5
Robert L. Bayes 53 Executive Vice President and 1996 1999 2,100 .2
Director
DIRECTORS REMAINING IN OFFICE
C. Cyrus Reynolds 70 Chairman of the Board 1960 1998 11,583 .9
David B. Barbour 49 President, Chief Executive 1995 1998
Officer and Director 33,254(5) 2.5
Jeffrey P. Lopez 38 Director 1996 1998 500 .03
Robert B. Keifer, Jr. 60 Director 1991 1999 11,583 .9
David A. Lang 53 Director 1991 1999 11,583 .9
- -------------------------

(1) At March 31, 1997.
(2) Includes service as a director of Classic Bank, except for Director
Bayes.
(3) Includes shares held directly, as well as shares held in retirement
accounts, shares allocated to the ESOP accounts of certain of the named
persons, held by certain members of the named individuals' families, or
held by trusts of which the named individual is a trustee or
substantial beneficiary, with respect to which shares the named
individuals may be deemed to have sole or shared voting and/or
investment power. The amount also includes 2,645 and 449 shares of
restricted stock awarded under the RRP, which will vest within 60 days
of June 16, 1997, to Mr. Barbour and to each of Messrs. Gevedon, Moyer,
Clark, Reynolds, Keifer and Lang, respectively, and 6,612 and 1,134
shares subject to options, which will become exercisable within 60 days
of June 16, 1997, awarded under the Stock Option Plan to Mr. Barbour
and to each of Messrs. Gevedon, Moyer, Clark, Reynolds, Keifer and
Lang, respectively.
(4) Includes 10,000 shares held by Mr. Gevedon's spouse.
(5) Includes 4,887 shares allocated to Mr. Barbour's account under the ESOP.

The business experience of each director of the Company for at least
the past five years is set forth below. All directors have held their positions
at least five years, except as otherwise indicated. Each director also serves as
a director of Classic Bank, except for Director Bayes. Directors Barbour, Bayes
and Gevedon also serve as directors of Paintsville Bank.

Everett B. Gevedon, Jr. Mr. Gevedon has served as real estate
consultant to corporations and individuals throughout the eastern United States
for the past 16 years. Prior to such time, he was a general real estate
appraiser and involved in real estate sales.

Robert A. Moyer, Jr. Mr. Moyer is President and Chief Executive Officer
of RAM Technologies, Inc., an Ashland, Kentucky based multi-faceted
communications and technology company. Mr. Moyer has held this position since he
founded the company in 1976. Mr. Moyer also serves as a trustee of the Marshall
University Foundation and a director of King's Daughters Medical Center and the
Economic Development Corporation of Boyd and Greenup Counties.

John W. Clark. Mr. Clark has been the President and Chief Executive
Officer of John W. Clark Oil Co., a company engaged in the distribution and sale
of petroleum products since its founding in 1970. In addition, he has been the
President of JRB, Inc., a common carrier trucking company, since 1977; Clark's
Pump N Stop, a convenience store, since 1978; B. J. Aviation, an airplane
leasing company, since 1990; and John W. Clark Enterprises, a real estate
development and holding company, since 1987.

Robert L. Bayes. Mr. Bayes is currently President and Chief Executive
Officer of Paintsville Bank and Executive Vice President of the Company. Mr.
Bayes previously served as President of Paintsville Bank beginning in 1983. A
Certified Public Accountant, Mr. Bayes holds a B.S. in Business Administration
from Berea College, attended the University of Kentucky and holds a graduate
banking degree from Stonier Graduate School of Banking at Rutgers University.
Mr. Bayes is a member of the American Institute of CPA's and Kentucky Society of
CPA's, a director of the Paintsville/Johnson County Chamber of Commerce and
Chairman of the Mayo State Vocational-Technical School Foundation. Mr. Bayes is
also a member of the Paintsville Independent School Site-Based Budget
Committee and the Mayo State Vocational-Technical School Advisory Committee.

C. Cyrus Reynolds. Mr. Reynolds is Chairman of the Board of the Company
and Classic Bank, positions he has held since September 1995 and July 1990,
respectively. Mr. Reynolds serves as Property Valuation Administrator

for Boyd County, Kentucky, an elected office he has held since 1977. From 1960
to 1981, Mr. Reynolds was the owner of Reynolds Insurance Agency, a general
lines insurance agency located in Ashland, Kentucky. Mr. Reynolds is a member
and former officer of the Ashland Lions Club and has served on various state
commissions, including 18 years of service as Chairman of the Boyd County
Democratic Party. Mr. Reynolds has also served as Treasurer of the Westwood
Christian Church for 40 years.

David B. Barbour. Mr. Barbour is the President and Chief Executive
Officer of the Company and Classic Bank, positions he has held since September
1995 and April 1995, respectively. Prior to joining Classic Bank in March of
1995, Mr. Barbour served as Senior Vice President and Senior Lending Officer of
First American Bank, a commercial bank located in Ashland, Kentucky with assets
of $225 million. As Senior Vice President and Senior Lending Officer, Mr.
Barbour was responsible for the bank's loan portfolio, including the commercial,
consumer and real estate lending divisions. Mr. Barbour had been employed by
First American Bank since 1977 and held a variety of management positions,
including Senior Vice President and Senior Lending Officer since 1989. Mr.
Barbour holds the designation of Certified Lender, Business Banking.

Robert B. Keifer, Jr. Mr. Keifer has been the principal of ESP, an
investment consulting firm based in Ashland, Kentucky and Lake Wylie, South
Carolina, a position he has held since 1992. From 1992 to 1994, Mr. Keifer also
served as a consultant to Equal Opportunity Finance, a minority small business
investment company. Mr. Keifer is a retired group vice-president of Ashland
Petroleum Company, an operating division of Ashland, Inc., where he was employed
from 1966 to 1992. Mr. Keifer also serves on the Board of Directors of Community
Hospice.

David A. Lang. Mr. Lang is Kentucky Region Manager for American
Electric Power, a position he has held since January 1996. Prior to such time,
he was an Electrical Systems Director for Kentucky Power Company, a subsidiary
of American Electric Power Company, a position he held from July 1995 to January
1996. Mr. Lang was promoted to Region Manager effective January 1, 1996. Mr.
Lang has been employed by American Electric Power since 1965 and has held a
variety of positions including Executive Assistant from May 1990 to June 1995.
Mr. Lang is a Registered Professional Engineer in the Commonwealth of Kentucky.
Mr. Lang serves as a director of East Kentucky Corporation, a regional economic
development corporation based in Hazard, Kentucky. Mr. Lang is also a director
of the Greenup Chamber of Commerce and a member of the Conference Board's USA
Quality Council V.

Jeffrey P. Lopez. Dr. Lopez is President of Ashland Radiation Oncology,
Inc. and owner of Tri-State Regional Cancer Center located in Ashland, Kentucky.
A native of Madison, Indiana, Dr. Lopez is a graduate of Indiana University,
obtained his medical degree from Indiana School of Medicine and served his
residency in Radiation Oncology at the University of Illinois. He serves on the
Board of Directors of the Boyd County chapter of the American Cancer Society, a
position that he has held since 1986. He is past President of the Boyd County
Medical Society, having served two terms as President. He is a member of the
Board of Directors for the Association of Free Standing Radiation Oncology
Centers, of which he is currently President, and is Chief of the Department of
Specials at King's Daughters' Medical Center in Ashland, Kentucky.

Board of Directors' Meetings and Committees

Meetings of the Company's Board of Directors are generally held on a
monthly basis. The Board of Directors of the Company held 11 meetings during the
fiscal year ended March 31, 1997. No incumbent director attended fewer than 75%
of the total number of meetings held by the Board of Directors and by all
committees of the Board of Directors on which he served during the fiscal year.

The Board of Directors of the Company has standing Executive, Audit,
Compensation and Nominating Committees.

The Executive Committee is comprised of Directors Reynolds, Barbour and
Gevedon. This committee meets on an as needed basis to act on matters arising
between Board meetings. This committee did not meet during fiscal 1997.

The Audit Committee reviews audit reports and related matters to ensure
effective compliance with regulations and internal policies and procedures. This
committee also acts on the recommendation by management of an accounting firm to
perform the Company's annual audit and acts as a liaison between the auditors
and the Board. Directors Keifer and Reynolds are the current members of this
committee. The committee met once during fiscal 1997.

The Compensation Committee establishes the Company's compensation
policies and reviews compensation matters and administers the Company's
stock-based plans. The current members of this Committee are Directors Moyer,
Lang and Clark. The committee held four meetings during fiscal 1997.

The Nominating Committee meets annually in order to nominate candidates
for membership on the Board of Directors. This committee is comprised of
Directors Reynolds, Barbour and Keifer. This committee did not meet during
fiscal 1997 as its function was performed by the entire Board of Directors.
While the Board of Directors will consider nominees recommended by stockholders,
the Committee has not actively solicited such nominations. Pursuant to the
Company's Bylaws, nominations by stockholders must be delivered in writing to
the Secretary of the Company at least 30 days before the date of the Meeting.

Director Compensation

Director Fees. Until April 1, 1997, the members of the Board of
Directors of the Company were not paid for their service in such capacity and
received compensation only for their service as directors of Classic Bank.
Effective April 1, 1997, the Company began paying each non-employee director
$200 per month for their services as directors of the Company. In addition,
effective April 1, 1997, each non-employee director of Classic Bank receives a
monthly fee of $400. Each director of Paintsville Bank who is not an employee of
Paintsville Bank (including Mr. Barbour) also receives a monthly fee of $400.
Compensation of Classic Bank's non-employee directors for fiscal 1997 is
described below.

During fiscal 1997, non-employee directors of Classic Bank were each
paid a monthly fee of $600 for service on the Board of Directors. The Chairman
of the Board received additional $2,100 per quarter for acting in such capacity.
Directors did not receive any additional compensation for committee meetings
attended.

Retirement Plan. Classic Bank maintains a Director Retirement Plan for
the benefit of Classic Bank's outside directors. This plan provides a retirement
benefit equal to one-half of the monthly compensation paid to current directors
for a period not to exceed the earlier of the number of months of service as a
director or his death. A director must have served on the Board of Directors for
a minimum of ten years and until age 65 in order to participate in the plan. For
the fiscal year ended March 31, 1997, Classic Bank's contribution to this plan
totaled $7,929.

Stock Option and Restricted Stock Awards. During fiscal 1997, options
to purchase 1,134 shares of Common Stock at an exercise price of $10.8125 per
share were granted under the Stock Option Plan to each of non-employee Directors
Gevedon, Moyer, Clark, Reynolds, Keifer and Lang. In addition, during fiscal
1997, 2,248 shares of restricted stock were awarded under the RRP to each of
Directors Gevedon, Moyer, Clark, Reynolds, Keifer and Lang. The options and
restricted stock granted to these non-employee directors are scheduled to vest
annually in 20% increments beginning July 29, 1997.

During fiscal 1997, options to purchase 12,000 and 2,500 shares of
Common Stock, each at an exercise price of $13.375 per share, were awarded under
the Stock Option Plan to Directors Bayes and Lopez, respectively. In addition,
during fiscal 1997, 2,000 shares of restricted stock were awarded under the RRP
to Director Bayes. The restricted stock awarded to Mr. Bayes and the options
granted to Messrs. Bayes and Lopez are scheduled to vest annually in 20%
increments beginning February 1, 1998

Information regarding stock options and restricted stock awarded to
Director Barbour, the President and Chief Executive Officer of the Company, is
contained below under the caption "Executive Compensation."

Executive Compensation

The Company has not paid any compensation to its executive officers
since its formation. The following table sets forth information concerning the
compensation paid or accrued by Classic Bank for services rendered by the
Company's and Classic Bank's President and Chief Executive Officer. No executive
officer of the Company, Classic Bank or Paintsville Bank had aggregate
compensation (salary plus bonus) in excess of $100,000 during fiscal 1997.

SUMMARY COMPENSATION TABLE

Long-Term Compensation
-----------------------------
Annual Compensation
---------------------------------
Awards Payouts
------------------ -------
Other Annual Restricted LTIP
Fiscal Salary Bonus Compensation Stock Options/ Payouts All Other
Name and Principal Position Year ($) ($) ($) Award($) SARs ($) Compensation($)
--------------------------- ------ ------ ----- ------------ --------- -------- ------- ---------------
(#)

David B. Barbour, President and 1997 $96,632.35 $--- (2) 142,995(3) 33,062 --- $63,340.38(4)
Chief Executive Officer and 1996 83,742.50 --- (2) --- --- --- 39,564.18(4)
Director 1995 4,564.00(1) --- (2) --- --- --- ---

====================================================================================================================================

(1) Mr. Barbour was hired in March 1995.
(2) Mr. Barbour has not received any additional benefits or perquisites which,
in the aggregate, have exceeded 10% of both his salary and bonus or $50,000.
(3) Represents the dollar value of 13,225 shares of restricted stock awarded
under the RRP, based on the $10.8125 closing price per share of the Common
Stock on the Nasdaq Stock Market on July 29, 1996, the date of grant. Based
on the $13.375 closing price per share of the Common Stock on the Nasdaq
Stock Market March 31, 1997, the aggregate value of the restricted stock
held by Mr. Barbour was $442,204 as of that date.
(4) Includes, for 1997 and 1996, respectively, country club membership fees
of $2,040 and $2,040 paid by Classic Bank on behalf of Mr. Barbour,
contributions made pursuant to the Supplemental Executive Retirement
Agreement between Classic Bank and Mr. Barbour of $11,057 and $17,931,
Classic Bank's contribution to Mr. Barbour's account under the ESOP of
3,161 and 1,726 shares of Common Stock based upon per share market
values, of $13.375 and $11.13 on March 31, 1997 and March 31, 1996 and
life insurance premiums paid by Classic Bank on behalf of Mr. Barbour
$5,565 and $382.80. Amount for 1997 also includes $2,400 in fees
received by Mr. Barbour for his service as a director of Paintsville
Bank, beginning October 1996 ($400 per month).

The following table sets forth certain information concerning grants of
stock options pursuant to the Stock Option Plan to the Company's President and
Chief Executive Officer during fiscal 1997. No stock appreciation rights
("SARs") were granted in fiscal 1997.

OPTION GRANTS IN LAST FISCAL YEAR

Individual Grants
--------------------------------------------------------
Number of % of Total
Shares Options
Underlying Granted to Per Share
Options Employees in Exercise Expiration
Granted Fiscal Year Price Date
-------------- ---------------- -------------- -----------
David B. Barbour 33,062(1) 26.1% $10.8125 07/29/06

- ----------
(1) The option is scheduled to vest annually in 20% increments beginning July
29, 1997.

The following table provides information as to stock options exercised
by the President and Chief Executive Officer during the fiscal year ended March
31, 1997, and the value of the options held by the President and Chief Executive
Officer on March 31, 1997.

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FY-END
OPTION VALUES
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options at Options at
FY-End (#) FY-End ($)

---------------------------- -------------------------------
Shares
Acquired Value
on Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
Name (#) ($) (#) (#) ($) ($)(1)
---- ----------- -------- ----------- ------------- ----------- --------------

David B. Barbour --- $ --- --- 33,062 $ --- $84,721

(1) Represents the aggregate market value (market price of the Common Stock less
the exercise price) of the options held based upon the exercise prices of
the option ($10.8125 per share) and the closing price of $13.375 per share
of the Common Stock as reported on the Nasdaq Stock Market on March 31,
1997.

Employment Agreement

Classic Bank has entered into an employment agreement with President
and Chief Executive Officer Barbour providing for an initial term of three
years. The employment agreement became effective upon completion of Classic
Bank's conversion from mutual to stock form and provides for an annual base
salary in an amount not less than such individual's then-current salary and
provides for an annual extension subject to the performance of an annual formal
evaluation by disinterested members of the Board of Directors of Classic Bank.
The agreement also provides for termination upon the employee's death, for cause
or in certain events specified by OTS regulations. The employment agreement is
also terminable by the employee upon 90 days' notice to Classic Bank.

The employment agreement provides for payment to President and Chief
Executive Officer Barbour of an amount equal to 299% of his five-year average
base compensation, where employment involuntarily terminates in connection with
a "change in control" of Classic Bank or within twelve months thereafter. For
the purposes of the employment agreement, a "change in control" is defined as
any event which would require the filing of an application for acquisition of
control or notice of change in control pursuant to 12 C.F.R. ss. 574.3 or 4.
Such events are generally triggered prior to the acquisition or control of 10%
of the Company's Common Stock. If the employment of President and Chief
Executive Officer Barbour had been terminated as of March 31, 1997 under
circumstances entitling him to severance pay as described above, he would have
been entitled to receive a lump sum cash payment of approximately $266,000. The
agreement also provides for the continued payment of Mr. Barbour's health
benefits for the remainder of the term of his contract in the event he is
involuntarily terminated in the event of change in control.

Supplemental Executive Retirement Agreement

Classic Bank entered into a non-qualified Supplemental Executive
Retirement Agreement (the "Agreement") with President Barbour which provides for
the payment of a monthly supplemental retirement benefit equal to up to 24% of
his average monthly compensation during the three highest 12-month periods prior
to retirement. Such benefit shall be payable upon normal retirement at age 65
or, under certain circumstances, after age 55 if his termination is without
cause. Upon the employee's death, 50% of the amount payable under the Agreement
shall be payable to his spouse until her death. The amount contributed by
Classic Bank pursuant to the Agreement on behalf of Mr. Barbour is included in
the Summary Compensation Table.

Certain Transactions

Classic Bank and Paintsville Bank follow policies of granting loans to
their respective (and the Company's) directors, officers and employees. The
loans by Classic Bank and Paintsville Bank to executive officers and directors
are made in the ordinary course of business and on the same terms and conditions
as those of comparable transactions prevailing at the time, in accordance with
each institution's respective underwriting guidelines and do not involve more
than the normal risk of collectibility or present other unfavorable features.
Federal law requires that all loans to directors and executive officers be made
on terms and conditions comparable to those for similar transactions with
non-affiliates. Loans by Classic Bank and Paintsville Bank to all of their (and
the Company's) respective directors and executive officers and the associates of
such directors and executive officers, including outstanding balances and
commitments, totaled $5.2 million at March 31, 1997, which was 26.8% of the
Company's stockholders' equity at that date. At March 31, 1997, there were no
loans by Classic Bank or Paintsville Bank to any director or executive officer
(or any affiliate of such director or executive officer) of the Company or of
Classic Bank or Paintsville Bank, made at preferential rates or terms which in
the aggregate exceeded $60,000 during the two years ended March 31, 1997.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act requires the Company's directors and
executive officers, and persons who own more than 10% of a registered class of
the Company's equity securities, to file with the SEC initial reports of
ownership and reports of changes in ownership of Common Stock and other equity
securities of the Company. Officers, directors and greater than 10% stockholders
are required by SEC regulations to furnish the Company with copies of all
Section 16(a) forms they file.

To the Company's knowledge, based solely on a review of the copies of
such reports furnished to the Company and written representations that no other
reports were required, during the fiscal year ended March 31, 1997, all Section
16(a) filing requirements applicable to its officers, directors and greater than
10 percent beneficial owners were met.

PROPOSAL II - RATIFICATION OF APPOINTMENT OF AUDITORS

The Board of Directors of the Company has appointed Smith, Goolsby,
Artis & Reams, P.S.C., independent accountants, to be the Company's auditors for
the fiscal year ending March 31, 1998. Representatives of Smith, Goolsby, Artis
& Reams, P.S.C. are expected to attend the Meeting to respond to appropriate
questions and to make a statement if they so desire.

THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE
RATIFICATION OF THE APPOINTMENT OF SMITH, GOOLSBY, ARTIS & REAMS, P.S.C. AS THE
COMPANY'S AUDITORS FOR THE FISCAL YEAR ENDING MARCH 31, 1998.

STOCKHOLDER PROPOSALS

In order to be eligible for inclusion in the Company's proxy materials
for the next annual meeting of stockholders, any stockholder proposal to take
action at such meeting must be received at the Company's office located at 344
Seventeen Street, Ashland, Kentucky 41101, no later than February 27, 1998. Any
such proposal shall be subject to the requirements of the proxy rules adopted
under the Exchange Act.

OTHER MATTERS

The Board of Directors is not aware of any business to come before the
Meeting other than those matters described above in this Proxy Statement.
However, if any other matter should properly come before the Meeting, it is
intended that holders of the proxies will act in accordance with their best
judgment.

The cost of solicitation of proxies will be borne by the Company. The
Company will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable expenses incurred by them in sending proxy materials
to the beneficial owners of Common Stock. In addition to solicitation by mail,
directors, officers and regular employees of the Company, Classic Bank or
Paintsville Bank may solicit proxies personally or by telegraph or telephone
without additional compensation.

Ashland, Kentucky
June 27, 1997

REVOCABLE PROXY REVOCABLE PROXY

CLASSIC BANCSHARES, INC.

ANNUAL MEETING OF STOCKHOLDERS
July 28, 1997

The undersigned hereby appoints the Board of Directors of Classic
Bancshares, Inc. (the "Company"), with full powers of substitution, to act as
attorneys and proxies for the undersigned to vote all shares of capital stock of
the Company which the undersigned is entitled to vote at the Annual Meeting of
Stockholders (the "Meeting") to be held at the corporate headquarters of RAM
Technologies, Inc. located at 1516 Bath Avenue, Ashland, Kentucky, on July 28,
1997 at 3:00 p.m., Ashland, Kentucky time, and at any and all adjournments and
postponements thereof.

I. The election as directors of all nominees listed below (except as
marked to the contrary)

|_| FOR |_| VOTE WITHHELD

INSTRUCTION: To withhold your vote for any individual nominee,
strike a line through that nominee's name below.

E.B. GEVEDON, JR. ROBERT A. MOYER, JR. JOHN W. CLARK
ROBERT L. BAYES

II. The ratification of the appointment of Smith, Goolsby, Artis & Reams,
P.S.C. as auditors for the Company for the fiscal year ending
March 31, 1998.

|_| FOR |_| AGAINST |_| ABSTAIN

In their discretion, the proxies are authorized to vote on any other
business that may properly come before the Meeting or any adjournment or
postponement thereof.

THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE
SPECIFIED, THIS PROXY WILL BE VOTED FOR EACH OF THE NOMINEES AND THE PROPOSAL
LISTED ABOVE. IF ANY OTHER BUSINESS IS PRESENTED AT THE MEETING, THIS PROXY WILL
BE VOTED BY THOSE NAMED IN THIS PROXY IN THEIR BEST JUDGMENT. AT THE PRESENT
TIME, THE BOARD OF DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE PRESENTED AT THE
MEETING.

The Board of Directors recommends a vote "FOR" the election of
each nominee and the proposal listed above.

(Continued and to be SIGNED on Reverse Side)

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

This Proxy may be revoked at any time before it is voted by: (i) filing
with the Secretary of the Company at or before the Meeting a written notice of
revocation bearing a later date than this Proxy; (ii) duly executing a
subsequent proxy relating to the same shares and delivering it to the Secretary
of the Company at or before the Meeting; or (iii) attending the Meeting and
voting in person (although attendance at the Meeting will not in and of itself
constitute revocation of this Proxy). If this Proxy is properly revoked as
described above, then the power of such attorneys and proxies shall be deemed
terminated and of no further force and effect.

The undersigned acknowledges receipt from the Company, prior to the
execution of this proxy, of Notice of the Meeting, a Proxy Statement and an
Annual Report to Stockholders for the fiscal year ended March 31, 1997.

Dated: , 1997 --------------------------------
Signature of Stockholder

--------------------------------
Signature of Stockholder

Please sign exactly as your
name(s) appear(s) to the left.
When signing as attorney,
executor, administrator, trustee
or guardian, please give your
full title. If shares are held
jointly, each holder should
sign.

PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN THE
ENCLOSED POSTAGE-PAID ENVELOPE