AMCORE Financial, Inc. Reports 4th Quarter Earnings

ROCKFORD, Ill., Jan. 22 /PRNewswire-FirstCall/ --

(Numbers in Thousands, Except Per Share Data)

Results From Continuing Operations

4th quarter 2007 YTD 2007 4th quarter 2006 YTD 2006
Net Revenues $57,243 $231,581 $62,322 $240,547
Net Income $7,530 $28,241 $12,629 $47,027
Diluted Shares 22,175 22,897 24,052 24,562
Diluted EPS $0.34 $1.23 $0.53 $1.91

AMCORE Financial, Inc. (Nasdaq: AMFI) reported diluted earnings per share
from continuing operations of $0.34 for fourth quarter 2007, which was a
decrease from $0.53 per diluted share in fourth quarter 2006, and an increase
from $0.08 in the previous quarter. Net income from continuing operations in
the fourth quarter of 2007 was $7.5 million, a decrease from $12.6 million in
the prior-year period, and an increase from $1.9 million in the previous
quarter.
Full year 2007 diluted earnings per share from continuing operations was
$1.23, which was a decrease from $1.91 in 2006. AMCORE's net income from
continuing operations for the full year 2007 decreased $18.8 million to
$28.2 million from $47.0 million in 2006, and includes a $19.0 million
increase in provision for loan losses compared to the previous year.
"In 2007, we added to our reserves in recognition of the general softening
of the economy and real estate markets," said Kenneth E. Edge, Chairman and
CEO of AMCORE. "We also began to implement cost controls and are taking
prudent steps to manage the size and scope of our business to be as strong as
possible given the current economic environment and short-term outlook for our
industry. AMCORE remains well capitalized and will focus on improving
efficiencies in 2008."
Highlights
-- Net interest income was $39.1 million or 3.28 percent of average
earning assets in fourth quarter 2007 compared to $41.1 million or
3.34 percent in fourth quarter 2006, and $40.4 million or 3.35 percent
of average earning assets in third quarter 2007.
-- Average loan balances were flat at $3.9 billion compared to fourth
quarter 2006, while average investment securities declined 16 percent
or $166 million. Average bank issued deposits decreased one percent
to $3.4 billion compared to the fourth quarter 2006.
-- Provision for loan losses was $6.4 million, a $3.4 million increase
from $3.0 million in fourth quarter 2006 and an $8.9 million decrease
from $15.3 million in third quarter 2007.
-- Net charge-offs were $4.8 million, or 0.48 percent of average
loans on an annualized basis, compared to $2.7 million and
0.27 percent in fourth quarter 2006, and $4.5 million and
0.45 percent in third quarter 2007, respectively.
-- Non-performing loans were $70.8 million, an increase of
$38.4 million from December 31, 2006 and $29.6 million from
September 30, 2007. Non-performing loans include $41.0 million of
non-accrual loans and $29.8 million of loans 90 days past due and
still accruing.
-- Non-interest income decreased $3.1 million compared to fourth quarter
2006 and increased $4.1 million compared to third quarter 2007.
-- Operating expenses decreased $1.5 million compared to fourth quarter
2006, but increased $1.7 million compared to third quarter 2007.

Revenues
Net revenues decreased $5.1 million to $57.2 million in fourth quarter
2007 from $62.3 million during the same quarter a year ago and increased
$2.8 million from $54.4 million in the previous quarter.
Net interest income decreased five percent, or $2.0 million, to
$39.1 million in fourth quarter 2007 from $41.1 million during the same
quarter a year ago, and decreased three percent, or $1.3 million, compared to
third quarter 2007. The net interest margin decreased six basis points to
3.28 percent in fourth quarter 2007 from 3.34 percent in fourth quarter 2006,
and decreased seven basis points compared to third quarter 2007.
Average loan balances were flat at $3.9 billion compared to fourth quarter
2006 and decreased one percent, or $51 million, compared to the previous
quarter. Average bank issued deposits decreased one percent, or $44 million,
to $3.4 billion compared to the fourth quarter 2006 and were essentially flat
compared to the previous quarter.
Total non-interest income decreased $3.1 million compared to fourth
quarter 2006 and increased $4.1 million compared to third quarter 2007. The
fourth quarter 2006 non-interest revenues included $1.8 million in earnings
from CRA-related fund investment earnings and a $1.5 million net insurance
claim on company-owned life insurance, compared to $360,000 and none,
respectively, in fourth quarter 2007. Third quarter 2007 included a
$5.6 million impairment loss on investment securities and $981,000 of
CRA-related fund investment earnings.
Investment management and trust revenues increased $112,000, or
three percent, but was essentially flat with third quarter 2007.
Deposit-related fees and bankcard fee income increased $1.5 million and
$397,000, or 22 percent and 24 percent, respectively, when compared to fourth
quarter 2006. When compared to the previous quarter, deposit related fees
increased $149,000, or two percent, and bankcard fee income increased $65,000,
or three percent.
Mortgage banking income decreased $593,000 in fourth quarter 2007 compared
to the same period a year ago, and decreased $48,000, from third quarter 2007.
The decline from a year ago was primarily due to a decline in servicing
revenues due to the sale of the Originated Mortgage Servicing Rights
portfolio.
Income from company-owned life insurance decreased $1.5 million when
compared to fourth quarter 2006, and decreased $266,000 when compared to third
quarter 2007. The fourth quarter decrease over the prior year period is
primarily due to net insurance claims in the prior period.
Other non-interest income decreased $2.7 million from fourth quarter 2006
and decreased $892,000 from third quarter 2007. Fourth quarter 2007 compared
to fourth quarter 2006 included a $1.4 million decrease in CRA-related fund
investment earnings and a decrease of $1.0 million related to derivatives.
The decrease in fourth quarter 2007 compared to third quarter 2007 was due to
lower CRA-related fund investment earnings.
Operating Expenses
Total operating expenses decreased $1.5 million, compared to fourth
quarter 2006, and increased $1.7 million, compared to third quarter 2007. The
decrease from fourth quarter 2006 was primarily related to lower employee
incentive and benefit costs, while the increase from third quarter 2007
related to a $766,000 increase in foreclosed property related costs. In
addition, as a member of the VISA, Inc. organization, AMCORE recognized a
$653,000 charge for its proportionate share of various litigation claims
against VISA, Inc.
Increased net occupancy and equipment expenses of $699,000 in fourth
quarter 2007 compared to fourth quarter 2006, primarily due to branch
expansion, were essentially offset by lower advertising and business
development costs. In 2007, AMCORE opened two branches in the suburban
Chicago communities of Deerfield and Willowbrook.
Increased advertising and business development costs in fourth quarter
2007, compared to third quarter 2007, were largely offset by lower
professional fees. Advertising and business development expenses included a
$300,000 contribution to the Company's private foundations to support
charitable work in its communities. The decrease in professional fees related
to lower external compliance related consulting costs.
The efficiency ratio was 71.19 percent compared to 67.79 percent for the
same period in 2006 and 71.81 percent in the prior quarter.
Income Taxes
Income taxes, as a percentage of pre-tax income from continuing
operations, were 24.0 percent for the year-to-date period ending December 31,
2007 compared to 27.7 percent in the same period a year ago. The decline is
due to a lower proportion of taxable versus tax-exempt income in the 2007
year-to-date period compared to the same period in 2006.
Other Key Performance Ratios
Other key ratios include a 35 basis point decrease in return on average
assets to 0.58 percent in fourth quarter 2007 compared to 0.93 percent during
the prior-year period and a 44 basis point increase from 0.14 percent in the
previous quarter. Return on average equity decreased 457 basis points to
7.94 percent in fourth quarter 2007 compared to 12.51 percent in fourth
quarter 2006 and increased 597 basis points from 1.97 percent in third quarter
2007.
Asset Quality & Loan Loss
The percentage of total non-performing assets to total assets was
1.45 percent at December 31, 2007, up from 0.64 percent at December 31, 2006
and 0.89 percent at September 30, 2007. Net charge-offs were $4.8 million, an
increase of $2.0 million from fourth quarter 2006 and an increase of $265,000
from third quarter 2007. Net charge-offs were 48 basis points of average loans
on an annualized basis during fourth quarter 2007, compared to 27 basis points
for fourth quarter 2006 and 45 basis points for third quarter 2007.
Provision for loan losses of $6.4 million in fourth quarter 2007 increased
$3.4 million, or 113 percent, from the $3.0 million in fourth quarter 2006 and
decreased $8.9 million, or 58 percent, from third quarter 2007.
Buy-back Update
During fourth quarter, 551,000 shares were repurchased at an average price
of $23.10, primarily in connection with the Company's stock buy-back program.
For the full year of 2007, 2.1 million shares were repurchased at an average
cost of $27.93.
AMCORE Financial, Inc. is headquartered in Northern Illinois and has
banking assets of $5.2 billion with 79 locations in Illinois and Wisconsin.
AMCORE provides a full range of consumer and commercial banking services, a
variety of mortgage lending products and wealth management services including
trust, brokerage, private banking, financial planning, investment management,
insurance and comprehensive retirement plan services.
This news release contains, and our periodic filings with the Securities
and Exchange Commission and written or oral statements made by the Company's
officers and directors to the press, potential investors, securities analysts
and others will contain, forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Act of 1934, and the Company intends that such forward-looking statements be
subject to the safe harbors created thereby with respect to, among other
things, the financial condition, results of operations, plans, objectives,
future performance and business of AMCORE. Statements that are not historical
facts, including statements about beliefs and expectations, are forward-
looking statements. These statements are based upon beliefs and assumptions
of AMCORE's management and on information currently available to such
management. The use of the words "believe", "expect", "anticipate", "plan",
"estimate", "should", "may", "will" or similar expressions identify
forward-looking statements. Forward-looking statements speak only as of the
date they are made, and AMCORE undertakes no obligation to update publicly any
forward-looking statements in light of new information or future events.
Contemplated, projected, forecasted or estimated results in such
forward-looking statements involve certain inherent risks and uncertainties. A
number of factors -- many of which are beyond the ability of the Company to
control or predict -- could cause actual results to differ materially from
those in its forward-looking statements. These factors include, among
others, the following possibilities: (I) heightened competition, including
specifically the intensification of price competition, the entry of new
competitors and the formation of new products by new or existing competitors;
(II) adverse state, local and federal legislation and regulation or adverse
findings or rulings made by local, state or federal regulators or agencies
regarding AMCORE and its operations ; (III) failure to obtain new customers
and retain existing customers; (IV) inability to carry out marketing and/or
expansion plans; (V) ability to attract and retain key executives or
personnel; (VI) changes in interest rates including the effect of prepayment;
(VII) general economic and business conditions which are less favorable than
expected; (VIII) equity and fixed income market fluctuations; (IX)
unanticipated changes in industry trends; (X) unanticipated changes in credit
quality and risk factors; (XI) success in gaining regulatory approvals when
required; (XII) changes in Federal Reserve Board monetary policies; (XIII)
unexpected outcomes on existing or new litigation in which AMCORE, its
subsidiaries, officers, directors or employees are named defendants; (XIV)
technological changes; (XV) changes in U.S. generally accepted accounting
principles; (XVI) changes in assumptions or conditions affecting the
application of "critical accounting estimates"; (XVII) inability of third-
party vendors to perform critical services for the Company or its customers;
(XVIII) disruption of operations caused by the conversion and installation of
data processing systems, and (XIX) zoning restrictions or other limitations at
the local level, which could prevent limited branch offices from transitioning
to full-service facilities.
AMCORE common stock is listed on The NASDAQ Stock Market under the symbol
"AMFI." Further information about AMCORE Financial, Inc. can be found at the
Company's website at http://www.AMCORE.com.

AMCORE Financial, Inc.
CONSOLIDATED FINANCIAL SUMMARY
(Unaudited)

($ in 000's except per share
data) 4th Qtr. 3rd Qtr. 2nd Qtr. 1st Qtr. 4th Qtr.
SHARE DATA 2007 2007 2007 2007 2006

Diluted earnings per share:
Income from continuing
operations $0.34 $0.08 $0.46 $0.35 $0.53
Net income $0.34 $0.08 $0.46 $0.35 $0.54
Cash dividends $0.185 $0.185 $0.185 $0.185 $0.185
Book value $16.80 $16.76 $16.58 $16.89 $16.81
Average diluted shares
outstanding 22,175 22,657 23,098 23,804 24,052
Ending shares outstanding 21,940 22,480 22,922 23,507 23,792

INCOME STATEMENT

Total Interest Income $83,865 $87,592 $86,817 $85,742 $88,090
Total Interest Expense 44,766 47,221 46,099 45,346 47,032
Net interest income 39,099 40,371 40,718 40,396 41,058

Provision for loan losses 6,400 15,281 4,227 3,179 3,007

Non-interest income:
Investment management &
trust 4,495 4,519 3,671 4,080 4,383
Service charges on deposits 8,001 7,852 7,436 6,329 6,536
Net mortgage revenues 269 317 596 926 862
Company owned life insurance 1,481 1,747 1,247 954 2,943
Brokerage commission 1,013 1,107 1,191 863 821
Bankcard fee income 2,060 1,995 1,947 1,860 1,663
Gain on sale of loans 1 - 1 241 150
Net security (losses) gains (346) (5,574) - - 42
Other 1,170 2,062 3,359 4,127 3,864
Total non-interest income 18,144 14,025 19,448 19,380 21,264

Operating expenses:
Personnel costs 22,278 22,188 23,998 26,460 25,245
Net occupancy & equipment 6,280 6,167 5,852 6,316 5,581
Data processing 884 843 955 687 779
Professional fees 2,061 2,503 1,904 1,929 2,214
Communication 1,280 1,385 1,270 1,323 1,231
Advertising & business
development 1,400 794 835 1,137 2,059
Other 6,566 5,180 5,734 7,130 5,140
Total operating expenses 40,749 39,060 40,548 44,982 42,249

Income from continuing
operations before income
taxes 10,094 55 15,391 11,615 17,066
Income tax (benefit)
expense 2,564 (1,834) 4,788 3,396 4,437
Income from continuing
operations 7,530 1,889 10,603 8,219 12,629
Discontinued operations:
Loss from discontinued
operations - - - - -
Income tax benefit - - - - (328)
Income from discontinued
operations - - - - 328
Net Income $7,530 $1,889 $10,603 $8,219 $12,957

($ in 000's except per share
data) 4Q/3Q 4Q 07/06 Year-to-Date 07/06
SHARE DATA Inc(Dec) Inc(Dec) 2007 2006 Inc(Dec)

Diluted earnings per share:
Income from continuing
operations 325% (36%) $1.23 $1.91 (36%)
Net income 325% (37%) $1.23 $1.92 (36%)
Cash dividends 0% 0% $0.74 $0.74 0%
Book value 0% 0% $16.80 $16.81 (0%)
Average diluted shares
outstanding (2%) (8%) 22,897 24,562 (7%)
Ending shares outstanding (2%) (8%) 21,940 23,792 (8%)

INCOME STATEMENT

Total Interest Income (4%) (5%) $344,016 $339,176 1%
Total Interest Expense (5%) (5%) 183,432 174,218 5%
Net interest income (3%) (5%) 160,584 164,958 (3%)

Provision for loan losses (58%) 113% 29,087 10,120 187%

Non-interest income:
Investment management & trust (1%) 3% 16,765 16,200 3%
Service charges on deposits 2% 22% 29,618 25,622 16%
Net mortgage revenues (15%) (69%) 2,108 3,917 (46%)
Company owned life insurance (15%) (50%) 5,429 7,891 (31%)
Brokerage commission (8%) 23% 4,174 3,146 33%
Bankcard fee income 3% 24% 7,862 6,225 26%
Gain on sale of loans N/M N/M 243 576 (58%)
Net security (losses) gains (94%) (924%) (5,920) 267 (2,317%)
Other (43%) (70%) 10,718 11,745 (9%)
Total non-interest income 29% (15%) 70,997 75,589 (6%)

Operating expenses:
Personnel costs 0% (12%) 94,924 97,890 (3%)
Net occupancy & equipment 2% 13% 24,615 20,891 18%
Data processing 5% 13% 3,369 2,998 12%
Professional fees (18%) (7%) 8,397 9,317 (10%)
Communication (8%) 4% 5,258 5,088 3%
Advertising & business
development 76% (32%) 4,166 7,409 (44%)
Other 27% 28% 24,610 21,772 13%
Total operating expenses 4% (4%) 165,339 165,365 (0%)

Income from continuing operations
before income taxes N/M (41%) 37,155 65,062 (43%)
Income tax (benefit) expense (240%) (42%) 8,914 18,035 (51%)
Income from continuing
operations 299% (40%) 28,241 47,027 (40%)
Discontinued operations:
Loss from discontinued
operations N/M N/M - (131) N/M
Income tax benefit N/M N/M - (379) N/M
Income from discontinued
operations N/M N/M - 248 N/M
Net Income 299% (42%) $28,241 $47,275 (40%)

4th Qtr. 3rd Qtr. 2nd Qtr. 1st Qtr. 4th Qtr.
KEY RATIOS AND DATA 2007 2007 2007 2007 2006

Net interest margin (FTE) 3.28% 3.35% 3.39% 3.38% 3.34%

Return on average assets (1) 0.58% 0.14% 0.81% 0.63% 0.93%
Return on average equity (1) 7.94% 1.97% 10.99% 8.34% 12.51%
Efficiency ratio (1) 71.19% 71.81% 67.39% 75.25% 67.79%
Equity/assets (end of period) 7.10% 7.16% 7.17% 7.54% 7.56%

Allowance to loans (end of
period) 1.35% 1.31% 1.01% 1.04% 1.04%
Allowance to non-accrual
loans 129.70% 186.57% 132.69% 136.59% 136.16%
Allowance to non-performing
loans 75.06% 125.08% 107.97% 111.55% 126.42%
Non-accrual loans to loans 1.04% 0.70% 0.76% 0.76% 0.76%
Non-performing assets to
total assets 1.45% 0.89% 0.78% 0.73% 0.64%

($ in millions)
Total assets under
administration $2,728 $2,789 $2,817 $2,711 $2,671
Mortgage loans closed $51 $64 $87 $75 $84
Mortgage servicing rights, net $0.1 $0.1 $1.2 $0.7 $14.3
Percentage of mortgage loans
serviced 0.94% 0.96% 1.07% 1.07% 0.97%

Basis Basis Basis
Point Point Year-to-Date Point
KEY RATIOS AND DATA Change Change 2007 2006 Change

Net interest margin (FTE) (7) (6) 3.35% 3.38% (3)

Return on average assets (1) 44 (35) 0.54% 0.88% (34)
Return on average equity (1) 597 (457) 7.32% 11.76% (444)
Efficiency ratio (1) (62) 340 71.40% 68.75% 265
Equity/assets (end of period) (6) (46)

Allowance to loans (end of period) 4 31
Allowance to non-accrual loans (5687) (646)
Allowance to non-performing loans (5002) (5136)
Non-accrual loans to loans 34 28
Non-performing assets to total assets 56 81

($ in millions)
Total assets under administration (2%) 2%
Mortgage loans closed (20%) (39%)
Mortgage servicing rights, net 0% (99%)
Percentage of mortgage loans serviced (2) (3)

N/M = not meaningful
(1) Ratios from continuing operations

AMCORE Financial, Inc.
CONSOLIDATED FINANCIAL SUMMARY (cont.)
(Unaudited)

($ in 000's) 4th Qtr. 3rd Qtr. 2nd Qtr. 1st Qtr.
AVERAGE BALANCE SHEET 2007 2007 2007 2007
Assets:
Investment securities, at
cost $871,626 $860,426 $868,713 $897,511
Short-term investments 6,856 4,814 3,584 19,127
Loans held for sale 6,653 8,514 13,477 12,305
Loans: Commercial 776,557 803,529 809,739 803,570
Commercial
real estate 2,358,906 2,382,397 2,389,201 2,354,882
Residential
real estate 488,532 491,982 495,046 498,427
Consumer 319,808 316,879 312,404 306,268
Total loans $3,943,803 $3,994,787 $4,006,390 $3,963,147
Total earning assets $4,828,938 $4,868,541 $4,892,164 $4,892,090

Allowance for loan losses (52,499) (42,354) (43,069) (41,653)
Goodwill 6,148 6,148 6,148 6,148
Other non-earning assets 412,641 414,042 410,019 399,135
Total assets $5,195,228 $5,246,377 $5,265,262 $5,255,720
Liabilities and
Stockholders' Equity:
Non-interest bearing
deposits $496,301 $499,550 $502,813 $492,766
Interest bearing deposits 1,873,883 1,809,846 1,786,600 1,784,489
Time deposits 1,067,981 1,130,992 1,161,978 1,199,365
Total bank issued
deposits $3,438,165 $3,440,388 $3,451,391 $3,476,620
Wholesale deposits 620,500 649,906 648,270 746,629
Short-term borrowings 327,678 294,584 323,911 157,511
Long-term borrowings 368,657 421,826 389,008 406,936
Total wholesale
funding $1,316,835 $1,366,316 $1,361,189 $1,311,076
Total interest bearing
liabilities 4,258,699 4,307,154 4,309,767 4,294,930
Other liabilities 64,144 59,949 65,784 68,126
Total liabilities $4,819,144 $4,866,653 $4,878,364 $4,855,822
Stockholders' equity 377,775 391,731 396,666 411,131
Other comprehensive loss (1,691) (12,007) (9,768) (11,233)
Total stockholders'
equity 376,084 379,724 386,898 399,898
Total liabilities &
stockholders' equity $5,195,228 $5,246,377 $5,265,262 $5,255,720

CREDIT QUALITY
Ending allowance for loan
losses $53,140 $51,500 $40,714 $41,308
Net charge-offs 4,760 4,495 4,821 2,784
Net charge-offs to avg
loans (annualized) 0.48% 0.45% 0.48% 0.28%
Non-performing assets:
Non-accrual loans $40,972 $27,603 $30,683 $30,242
Loans 90 days past due
& still accruing 29,826 13,571 7,024 6,790
Total non-performing
loans 70,798 41,174 37,707 37,032
Foreclosed real estate 4,108 5,251 3,553 1,205
Other foreclosed assets 201 236 164 231
Total non-performing
assets $75,107 $46,661 $41,424 $38,468

YIELD AND RATE ANALYSIS
Assets:
Investment securities (FTE) 4.61% 4.56% 4.42% 4.43%
Short-term investments 5.31% 6.61% 6.27% 5.64%
Loans held for sale 7.61% 6.51% 5.68% 4.86%
Loans: Commercial 7.80% 8.24% 8.27% 8.23%
Commercial
real estate 7.42% 7.75% 7.76% 7.80%
Residential real
estate 6.94% 7.13% 7.03% 7.05%
Consumer 7.96% 7.76% 7.69% 7.53%
Total loans (FTE) 7.48% 7.77% 7.77% 7.77%
Total interest earning
assets (FTE) 6.96% 7.20% 7.17% 7.14%
Liabilities:
Interest bearing deposits 3.23% 3.44% 3.30% 3.25%
Time deposits 4.58% 4.70% 4.69% 4.65%
Total bank issued deposits 3.72% 3.92% 3.85% 3.82%
Wholesale deposits 5.11% 5.13% 5.11% 5.16%
Short-term borrowings 4.80% 5.08% 5.09% 4.85%
Long-term borrowings 5.63% 5.61% 5.62% 5.85%
Total wholesale funding 5.18% 5.27% 5.25% 5.34%
Total interest bearing
liabilities 4.17% 4.35% 4.29% 4.28%
Net interest spread 2.79% 2.85% 2.88% 2.86%
Net interest margin (FTE) 3.28% 3.35% 3.39% 3.38%

FTE adjustment (000's) $701 $657 $619 $608

4Q
($ in 000's) 4th Qtr. 4Q/3Q 07/06 Ending
AVERAGE BALANCE SHEET 2006 Inc(Dec) Inc(Dec) Balances

Assets:
Investment securities , at cost $1,037,355 1% (16%) $848,069
Short-term investments 7,672 42% (11%) 12,882
Loans held for sale 14,983 (22%) (56%) 3,636
Loans: Commercial 806,679 (3%) (4%) 767,312
Commercial real estate 2,322,050 (1%) 2% 2,361,180
Residential real estate 506,514 (1%) (4%) 468,420
Consumer 311,643 1% 3% 335,772
Total loans $3,946,886 (1%) (0%) $3,932,684
Total earning assets $5,006,896 (1%) (4%) $4,797,271

Allowance for loan losses (41,917) 24% 25% (53,140)
Goodwill 6,148 0% 0% 6,148
Other non-earning assets 403,640 (0%) 2% 442,499
Total assets $5,374,767 (1%) (3%) $5,192,778
Liabilities and Stockholders' Equity:
Non-interest bearing deposits $504,960 (1%) (2%) $508,389
Interest bearing deposits 1,760,241 4% 6% 1,867,633
Time deposits 1,217,385 (6%) (12%) 1,029,418
Total bank issued deposits $3,482,586 (0%) (1%) $3,405,440
Wholesale deposits 807,470 (5%) (23%) 597,816
Short-term borrowings 286,422 11% 14% 397,088
Long-term borrowings 328,591 (13%) 12% 368,858
Total wholesale funding $1,422,483 (4%) (7%) $1,363,762
Total interest bearing
liabilities 4,400,109 (1%) (3%) 4,260,813
Other liabilities 69,290 7% (7%) 55,009
Total liabilities $4,974,359 (1%) (3%) $4,824,211
Stockholders' equity 412,003 (4%) (8%) 371,883
Other comprehensive loss (11,595) (86%) (85%) (3,316)
Total stockholders' equity 400,408 (1%) (6%) 368,567
Total liabilities &
stockholders' equity $5,374,767 (1%) (3%) $5,192,778

CREDIT QUALITY
Ending allowance for loan losses $40,913 3% 30%
Net charge-offs 2,720 6% 75%
Net charge-offs to avg loans
(annualized) 0.27% 7% 78%
Non-performing assets:
Non-accrual loans $30,048 48% 36%
Loans 90 days past due & still
accruing 2,315 120% 1188%
Total non-performing loans 32,363 72% 119%
Foreclosed real estate 1,247 (22%) 229%
Other foreclosed assets 317 (15%) (37%)
Total non-performing assets $33,927 61% 121%

YIELD AND RATE ANALYSIS
Assets:
Investment securities (FTE) 4.54%
Short-term investments 5.66%
Loans held for sale 5.61%
Loans: Commercial 8.08%
Commercial real estate 7.83%
Residential real estate 7.00%
Consumer 7.41%
Total loans (FTE) 7.74%
Total interest earning assets (FTE) 7.07%
Liabilities:
Interest bearing deposits 3.18%
Time deposits 4.57%
Total bank issued deposits 3.75%
Wholesale deposits 5.10%
Short-term borrowings 5.10%
Long-term borrowings 5.86%
Total wholesale funding 5.27%
Total interest bearing liabilities 4.24%
Net interest spread 2.83%
Net interest margin (FTE) 3.34%

FTE adjustment (000's) $974

SOURCE AMCORE Financial, Inc.

media, Katherine Taylor, Investor Relations Manager, +1-815-961-7164, or
financial, Don Wilson, President and Chief Operating Officer, +1-815-961-2721,
both of AMCORE Financial, Inc.