UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                    FORM 10-Q

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

     For The Quarterly Period Ended September 30, 2003

[ ]  TRANSITION  REPORT  PURSUANT  TO SECTION  13 OR 15(d) OF THE  SECURITIES
     EXCHANGE ACT OF 1934

     For The Transition Period From               to

<TABLE>
<CAPTION>

                               Exact Name of Registrant as specified in its charter;
         Commission            State of Incorporation;                                         IRS Employer
         File Number           Address and Telephone Number                                    Identification No.
         -----------           ----------------------------                                    ------------------
        <S>                   <C>                                                                  <C>
         1-14756               Ameren Corporation                                                   43-1723446
                               (Missouri Corporation)
                               1901 Chouteau Avenue
                               St. Louis, Missouri 63103
                               (314) 621-3222

         1-2967                Union Electric Company                                               43-0559760
                               (Missouri Corporation)
                               1901 Chouteau Avenue
                               St. Louis, Missouri 63103
                               (314) 621-3222

         1-3672                Central Illinois Public Service Company                              37-0211380
                               (Illinois Corporation)
                               607 East Adams Street
                               Springfield, Illinois 62739
                               (217) 523-3600

         333-56594             Ameren Energy Generating Company                                     37-1395586
                               (Illinois Corporation)
                               1901 Chouteau Avenue
                               St. Louis, Missouri 63103
                               (314) 621-3222




<PAGE>


         2-95569               CILCORP Inc.                                                         37-1169387
                               (Illinois Corporation)
                               300 Liberty Street
                               Peoria, Illinois 61602
                               (309) 677-5230

         1-2732                Central Illinois Light Company                                       37-0211050
                               (Illinois Corporation)
                               300 Liberty Street
                               Peoria, Illinois 61602
                               (309) 677-5230

</TABLE>

Indicate  by check mark  whether  the  registrants  (1) have  filed all  reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports), and (2) have been subject to such
filing requirements for the past 90 days. Yes (X) No ( )

Indicate  by check mark  whether  the  registrants  are  accelerated  filers (as
defined in Rule 12b-2 of the Securities Exchange Act of 1934).

<TABLE>
<CAPTION>

    <S>                                                      <C>    <C>         <C>   <C>
     Ameren Corporation                                       Yes    (X)        No     ( )
     Union Electric Company                                   Yes    ( )        No     (X)
     Central Illinois Public Service Company                  Yes    ( )        No     (X)
     Ameren Energy Generating Company                         Yes    ( )        No     (X)
     CILCORP Inc.                                             Yes    ( )        No     (X)
     Central Illinois Light Company                           Yes    ( )        No     (X)

</TABLE>

Number of shares outstanding of each of the registrant's classes of common stock
as of November 7, 2003:

<TABLE>
<CAPTION>
   <S>                                                       <C>

     Ameren Corporation                                       Common stock, $.01 par value - 162,400,592

     Union Electric Company                                   Common stock, $5 par value, held by Ameren Corporation
                                                              (parent company of the registrant) -
                                                              102,123,834

     Central Illinois Public Service Company                  Common stock, no par value, held by
                                                              Ameren Corporation (parent company of the registrant) -
                                                              25,452,373

     Ameren Energy Generating Company                         Common stock, no par value, held by
                                                              Ameren Energy Development Company (parent company
                                                              of the registrant and indirect subsidiary of Ameren
                                                              Corporation) - 2,000



<PAGE>


     CILCORP Inc.                                             Common stock, no par value, held by Ameren
                                                              Corporation (parent company of the registrant) -
                                                              1,000

     Central Illinois Light Company                           Common stock, no par value, held by CILCORP
                                                              Inc. (parent company of the registrant and
                                                              subsidiary of Ameren Corporation) - 13,563,871

</TABLE>

This  combined  Form  10-Q is  separately  filed by  Ameren  Corporation,  Union
Electric  Company,  Central  Illinois  Public  Service  Company,  Ameren  Energy
Generating  Company,  CILCORP  Inc. and Central  Illinois  Light  Company.  Each
registrant  hereto is filing on its own behalf all of the information  contained
in this quarterly report that relates to such registrant. Each registrant hereto
is not  filing any  information  that does not  relate to such  registrant,  and
therefore makes no representation as to any such information.

Prior to this quarterly report on Form 10-Q, separate filings were made by each
registrant, except CILCORP Inc. and Central Illinois Light Company, which made a
combined filing. Ameren Corporation and its subsidiaries switched to a combined
filing in order to improve disclosure and to simplify administrative processes.

                         OMISSION OF CERTAIN INFORMATION

Ameren  Energy  Generating  Company  meets the  conditions  set forth in General
Instruction  H(1)(a) and (b) of Form 10-Q and is therefore filing this form with
the reduced disclosure format.




<PAGE>
<TABLE>
<CAPTION>


                               AMEREN CORPORATION
                             UNION ELECTRIC COMPANY
                     CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
                        AMEREN ENERGY GENERATING COMPANY
                                  CILCORP INC.
                         CENTRAL ILLINOIS LIGHT COMPANY

                                TABLE OF CONTENTS


                                                                                                                           Page
                                                                                                                           ----
<S><C>          <C>                                                                                                         <C>
GLOSSARY OF TERMS AND ABBREVIATIONS......................................................................................    3

PART I.          Financial Information

   ITEM 1.       Financial Statements (Unaudited)

                 Ameren Corporation
                 Consolidated Balance Sheet..............................................................................    6
                 Consolidated Statement of Income........................................................................    7
                 Consolidated Statement of Cash Flows....................................................................    8

                 Union Electric Company
                 Consolidated Balance Sheet..............................................................................    9
                 Consolidated Statement of Income........................................................................   10
                 Consolidated Statement of Cash Flows....................................................................   11

                 Central Illinois Public Service Company
                 Balance Sheet...........................................................................................   12
                 Statement of Income.....................................................................................   13
                 Statement of Cash Flows.................................................................................   14

                 Ameren Energy Generating Company
                 Balance Sheet...........................................................................................   15
                 Statement of Income.....................................................................................   16
                 Statement of Cash Flows.................................................................................   17

                 CILCORP Inc.
                 Consolidated Balance Sheet..............................................................................   18
                 Consolidated Statement of Income........................................................................   19
                 Consolidated Statement of Cash Flows....................................................................   20


                                       1

<PAGE>


                 Central Illinois Light Company
                 Consolidated Balance Sheet..............................................................................   21
                 Consolidated Statement of Income........................................................................   22
                 Consolidated Statement of Cash Flows....................................................................   23

                 Combined Notes to Financial Statements..................................................................   24

   ITEM 2.       Management's Discussion and Analysis of Financial Condition and Results of Operations...................   52

   ITEM 3.       Quantitative and Qualitative Disclosures About Market Risk..............................................   71

   ITEM 4.       Controls and Procedures.................................................................................   75

                 Forward-Looking Statements..............................................................................   75



PART II.         Other Information

   ITEM 1.       Legal Proceedings.......................................................................................   77

   ITEM 6.       Exhibits and Reports on Form 8-K........................................................................   77

SIGNATURES................................................................................................................  80
</TABLE>


This Form 10-Q  contains  "forward-looking  statements"  within  the  meaning of
Section 21E of the Securities Exchange Act of 1934.  Forward-looking  statements
should be read with the cautionary  statements and important factors included in
this  Form  10-Q at  Part I  under  the  heading  "Forward-Looking  Statements."
Forward-looking   statements  are  all  statements   other  than  statements  of
historical  fact,  including those  statements that are identified by the use of
the words "anticipates," "estimates," "expects," "intends," "plans," "predicts,"
"projects," and similar expressions.

                                        2


<PAGE>


                       GLOSSARY OF TERMS AND ABBREVIATIONS

AERG  -  AmerenEnergy   Resources   Generating  Company,  a  non  rate-regulated
subsidiary of CILCO,  which was formerly known as Central  Illinois  Generation,
Inc.

AES - The AES Corporation.

AFS - Ameren  Energy  Fuels and  Services  Company,  a  subsidiary  of Resources
Company,  which  procures  fuel and gas and manages  the  related  risks for the
Ameren Companies.

Ameren - Ameren  Corporation and its subsidiaries on a consolidated  basis. When
referring to financing or  acquisition  activities,  Ameren is defined as Ameren
Corporation, the parent.

Ameren  Companies - The individual  registrants  within the Ameren  consolidated
group.

Ameren Energy - Ameren Energy,  Inc., a subsidiary of Ameren Corporation,  which
serves as a power marketing and risk management  agent for the Ameren  Companies
for transactions of primarily less than one year.

Ameren Services - Ameren Services Company,  a subsidiary of Ameren  Corporation,
which provides a variety of support services to Ameren and its subsidiaries.

ARB - Accounting Research Bulletin.

CERCLA (Superfund) - Comprehensive Environmental Response Compensation Liability
Act  of  1980,  which  is  federal  environmental   legislation  that  addresses
remediation of contaminated sites.

CESI - CILCORP Energy  Services,  Inc., a subsidiary of CILCORP,  which operates
gas management  services that include  commodity  procurement and re-delivery to
retail customers.

CILCORP - CILCORP Inc., a subsidiary of Ameren Corporation,  which operates as a
holding company for CILCO.

CILCO - Central Illinois Light Company, a subsidiary of CILCORP, which operates
a rate-regulated transmission and distribution business, an electric generation
business, and a rate-regulated natural gas distribution business in Illinois as
AmerenCILCO.

CIPS  -  Central  Illinois  Public  Service  Company,  a  subsidiary  of  Ameren
Corporation,   which  operates  a   rate-regulated   electric  and  natural  gas
transmission and distribution business in Illinois as AmerenCIPS.

Development  Company  - Ameren  Energy  Development  Company,  a  subsidiary  of
Resources  Company,  which  develops and  constructs  generating  facilities for
Genco.

DOJ -  Department  of Justice,  a  governmental  agency of the United  States of
America.

EEI - Electric  Energy,  Inc., a 60%-owned  subsidiary  of Ameren,  which is 40%
owned by UE and 20% owned by Resources Company.

EITF - Emerging Issues Task Force,  an  organization  that is designed to assist
the FASB in improving financial reporting through the identification, discussion
and   resolution   of  financial   issues   within  the  framework  of  existing
authoritative literature.

EPA -  Environmental  Protection  Agency,  a  governmental  agency of the United
States of America.

ERISA - Employee Retirement Income Security Act of 1974.

                                        3
<PAGE>

Exchange Act - Securities Exchange Act of 1934, as amended.

FASB - Financial  Accounting  Standards  Board, a rulemaking  organization  that
establishes financial accounting and reporting standards in the United States of
America.

FERC - Federal Energy  Regulatory  Commission,  the  governmental  agency of the
United  States  of  America  that,  among  other  things,  regulates  interstate
transmission and wholesale sales of electricity and gas and related matters.

FIN  - FASB  Interpretation,  intended  to  clarify  accounting   pronouncements
previously issued by the FASB.

GAAP - Generally accepted accounting principles in the United States of America.

Genco - Ameren Energy Generating  Company, a subsidiary of Development  Company,
which operates a non rate-regulated electric generation business in Illinois and
Missouri.

GridAmerica Companies - UE, CIPS, American Transmission Systems Incorporated,  a
subsidiary of  FirstEnergy  Corporation,  and Northern  Indiana  Public  Service
Company, a subsidiary of NiSource, Inc.

IBEW - International Brotherhood of Electrical Workers.

ICC - Illinois Commerce  Commission,  a state agency that regulates the Illinois
utility businesses and operations of UE, CIPS and CILCO.

ITC - Independent Transmission Company.

IUOE - International Union of Operating Engineers.

LIBOR - London Interbank Offered Rate.

MAIN  -  Mid-America  Interconnected  Network,  one  of  the  regional  electric
reliability  councils  organized for  coordinating the planning and operation of
the nation's bulk power supply.

Marketing Company - Ameren Energy Marketing  Company,  a subsidiary of Resources
Company, which markets power for periods primarily over one year.

Medina  Valley  -  AmerenEnergy  Medina  Valley  Cogen  (No.  4),  LLC  and  its
subsidiaries,  subsidiaries  of Resources  Company,  which  indirectly owns a 40
megawatt, gas-fired electric generation plant.

Midwest ISO - Midwest Independent System Operator.

MoPSC - Missouri  Public Service  Commission,  a state agency that regulates the
Missouri utility business and operations of UE.

NOPR - Notice of Proposed Rulemaking issued by the FERC.

NRG - NRG Energy, Inc.

NSR - New Source Review programs under the federal Clean Air Act.

NYMEX - New York Mercantile Exchange.

OATT - Open Access Transmission Tariff.

OCI - Other Comprehensive Income (Loss) as defined by GAAP.

                                       4
<PAGE>

PGA - Purchased Gas Adjustment tariff, which impacts UE, CIPS and CILCO natural
gas utility customers.

PUHCA - Public Utility Holding Company Act of 1935.

Resources  Company - Ameren  Energy  Resources  Company,  a subsidiary of Ameren
Corporation,  which consists of non rate-regulated operations,  including Genco,
Development Company, Marketing Company and AFS.

RRO - Regional Reliability Organization.

RTO - Regional Transmission Organization.

SEC - Securities and Exchange  Commission,  a governmental  agency of the United
States of America.

SFAS - Statement of Financial Accounting Standards, the accounting and financial
reporting rules issued by the FASB.

UE - Union Electric Company, a subsidiary of Ameren Corporation, which operates
a rate-regulated electric generation, transmission and distribution business,
and a rate-regulated natural gas distribution business in Missouri and Illinois
as AmerenUE.

                                       5
<PAGE>
<TABLE>
<CAPTION>



                          PART I. FINANCIAL INFORMATION

ITEM 1. Financial Statements.


                               AMEREN CORPORATION
                           CONSOLIDATED BALANCE SHEET
               (Unaudited) (In millions, except per share amounts)

                                                                   September 30,  December 31,
                                                                      2003           2002
                                                                   ------------   -----------
                                  ASSETS
<S>                                                                  <C>         <C>
Current Assets:
 Cash and cash equivalents                                             $    100    $    628
 Accounts receivables - trade (less allowance for doubtful
   accounts of $9 and $7, respectively)                                     362         266
 Unbilled revenue                                                           184         176
 Miscellaneous accounts and notes receivable                                131          44
 Materials and supplies, at average cost                                    476         299
 Other current assets                                                        57          39
                                                                       --------    --------
   Total current assets                                                   1,310       1,452
                                                                       --------    --------
Property and Plant, Net                                                  10,152       8,840
Investments and Other Non-Current Assets:
 Investments                                                                166          38
 Nuclear decommissioning trust fund                                         195         172
 Goodwill and other intangibles, net                                        630           -
 Other assets                                                               317         307
                                                                       --------    --------
   Total investments and other non-current assets                         1,308         517
                                                                       --------    --------
Regulatory Assets                                                           767         690
                                                                       --------    --------
           TOTAL ASSETS                                                $ 13,537    $ 11,499
                                                                       ========    ========


                   LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
 Current maturities of long-term debt                                  $    499    $    339
 Short-term debt                                                              3         271
 Accounts and wages payable                                                 275         369
 Taxes accrued                                                              231          45
 Other current liabilities                                                  241         177
                                                                       --------    --------
   Total current liabilities                                              1,249       1,201
                                                                       --------    --------
Long-term Debt, Net                                                       4,046       3,433
Preferred Stock of Subsidiary Subject to Mandatory Redemption                21           -
Deferred Credits and Other Non-Current Liabilities:
 Accumulated deferred income taxes, net                                   1,993       1,707
 Accumulated deferred investment tax credits                                153         149
 Regulatory liabilities                                                     133         136
 Asset retirement obligations                                               408         174
 Accrued pension liabilities                                                527         377
 Other deferred credits and liabilities                                     439         272
                                                                       --------    --------
   Total deferred credits and other non-current liabilities               3,653       2,815
                                                                       --------    --------
Preferred Stock of Subsidiaries Not Subject to Mandatory Redemption         213         193
Minority Interest in Consolidated Subsidiaries                               21          15
Commitments and Contingencies (Note 8)
Stockholders' Equity:
 Common stock, $.01 par value, 400.0 shares authorized -
   shares outstanding of 162.3 and 154.1, respectively                        2           2
 Other paid-in capital, principally premium on common stock               2,528       2,203
 Retained earnings                                                        1,917       1,739
 Accumulated other comprehensive income (loss)                             (103)        (93)
 Other                                                                      (10)         (9)
                                                                       --------    --------
   Total stockholders' equity                                             4,334       3,842
                                                                       --------    --------
           TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                  $ 13,537    $ 11,499
                                                                       ========    ========

The  accompanying  notes are an integral  part of these  consolidated  financial
statements.

</TABLE>
                                       6
<PAGE>
<TABLE>
<CAPTION>

                               AMEREN CORPORATION
                        CONSOLIDATED STATEMENT OF INCOME
               (Unaudited) (In millions, except per share amounts)

                                                                  Three Months Ended               Nine Months Ended
                                                                    September 30,                    September 30,
                                                             --------------------------        --------------------------
                                                                 2003          2002               2003          2002
                                                             ------------ -------------        ------------- ------------
<S>                                                         <C>            <C>                <C>            <C>
Operating Revenues:
 Electric                                                     $     1,266    $    1,135        $     3,090    $     2,812
 Gas                                                                   82            30                450            202
 Other                                                                  2             1                  6              4
                                                              -----------    ----------        -----------    -----------
       Total operating revenues                                     1,350         1,166              3,546          3,018
                                                              -----------    ----------        -----------    -----------
Operating Expenses:
 Fuel and purchased power                                             330           248                793            655
 Gas purchased for resale                                              54            17                326            129
 Other operations and maintenance                                     302           278                901            835
 Coal contract settlement                                             (51)            -                (51)             -
 Depreciation and amortization                                        132           108                388            321
 Taxes other than income taxes                                         83            74                238            211
                                                              -----------    ----------        -----------    -----------
       Total operating expenses                                       850           725              2,595          2,151
                                                              -----------    ----------        -----------    -----------
Operating Income                                                      500           441                951            867

Other Income and (Deductions):
    Miscellaneous income                                                4             6                 16             16
    Miscellaneous expense                                              (3)           (3)               (14)           (46)
                                                              -----------    ----------        -----------    -----------
       Total other income and (deductions)                              1             3                  2            (30)
                                                              -----------    ----------        -----------    -----------
Interest Charges and Preferred Dividends:
 Interest                                                              69            56                204            158
 Preferred dividends of subsidiaries                                    3             3                  8              9
                                                              -----------    ----------        -----------    -----------
       Net interest charges and preferred dividends                    72            59                212            167
                                                              -----------    ----------        -----------    -----------
Income Before Income Taxes and Cumulative Effect of Change
 in Accounting Principle                                              429           385                741            670
Income Taxes                                                          154           145                273            256
                                                              -----------    ----------        -----------    -----------
Income Before Cumulative Effect of Change in Accounting
 Principle                                                            275           240                468            414
Cumulative Effect of Change in Accounting Principle,
 Net of Income Taxes                                                    -             -                 18              -
                                                              -----------    ----------        -----------    -----------
Net Income                                                    $       275    $      240        $       486    $       414
                                                              ===========    ==========        ===========    ===========
Earnings per Common Share - Basic:
 Income before cumulative effect of change
    in accounting principle                                   $      1.70    $     1.64        $      2.91    $      2.88
 Cumulative effect of change in accounting
    principle, net of income taxes                                      -             -               0.11              -
                                                             ------------    -----------       -----------    -----------
 Net income                                                   $      1.70    $     1.64        $      3.02    $      2.88
                                                             ============    ===========       ===========    ===========
Earnings per Common Share - Diluted:
 Income before cumulative effect of change
    in accounting principle                                   $      1.70    $     1.63        $      2.91    $      2.87
 Cumulative effect of change in accounting
    principle, net of income taxes                                      -             -               0.11              -
                                                              -----------    -----------       -----------    -----------
 Net income                                                   $      1.70    $     1.63        $      3.02    $      2.87
                                                              ===========    ===========       ===========    ===========

Dividends per Common Share                                    $     0.635    $    0.635        $     1.905    $     1.905
Average Common Shares Outstanding                                   161.8         146.7              160.7          143.6

The accompanying notes are an integral part of these consolidated financial
statements.

</TABLE>

                                       7

<PAGE>
<TABLE>
<CAPTION>

                               AMEREN CORPORATION
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                            (Unaudited) (In millions)

                                                                                        Nine Months Ended
                                                                                           September 30,
                                                                                     ---------------------
                                                                                        2003      2002
                                                                                     ----------  ---------
<S>   <C>     <C>                                                                       <C>     <C>
Cash Flows From Operating Activities:
 Net income                                                                            $  486    $  414
 Adjustments to reconcile net income to net cash
   provided by operating activities:
    Cumulative effect of change in accounting principle                                   (18)        -
    Depreciation and amortization                                                         388       321
    Amortization of nuclear fuel                                                           25        25
    Amortization of debt issuance costs and premium/discounts                               8         6
    Deferred income taxes, net                                                             30        11
    Deferred investment tax credits, net                                                   (9)       (6)
    Coal contract settlement                                                              (45)        -
    Other                                                                                  (8)        5
    Changes in assets and liabilities, excluding the effects of the acquisitions:
       Receivables, net                                                                    17       (49)
       Materials and supplies                                                             (69)       15
       Accounts and wages payable                                                        (171)     (217)
       Taxes accrued                                                                      167       214
       Assets, other                                                                       (8)      (23)
       Liabilities, other                                                                  59        17
                                                                                       ------    ------
Net cash provided by operating activities                                                 852       733
                                                                                       ------    ------

Cash Flows From Investing Activities:
 Construction expenditures                                                               (457)     (565)
 Acquisitions, net of cash acquired                                                      (489)        -
 Nuclear fuel expenditures                                                                 (2)      (25)
 Other                                                                                     10         8
                                                                                       ------    ------
Net cash used in investing activities                                                    (938)     (582)
                                                                                       ------    ------

Cash Flows From Financing Activities:
 Dividends on common stock                                                               (308)     (279)
 Capital issuance costs                                                                   (13)      (35)
 Redemptions, repurchases, and maturities:
   Nuclear fuel lease                                                                     (38)        -
   Short-term debt                                                                       (268)     (635)
   Long-term debt                                                                        (648)     (158)
   Preferred stock                                                                         (1)      (41)
 Issuances:
   Common stock                                                                           336       635
   Nuclear fuel lease                                                                       -        31
   Long-term debt                                                                         498       893
                                                                                       ------    ------
Net cash provided by (used in) financing activities                                      (442)      411
                                                                                       ------    ------

Net change in cash and cash equivalents                                                  (528)      562
Cash and cash equivalents at beginning of year                                            628        67
                                                                                       ------    ------
Cash and cash equivalents at end of period                                             $  100    $  629
                                                                                       ======    ======

Cash Paid During the Periods:
 Interest                                                                              $  189    $  142
 Income taxes, net                                                                        156       111


The  accompanying  notes are an integral  part of these  consolidated  financial
statements.
</TABLE>

                                        8



<PAGE>
<TABLE>
<CAPTION>

                           UNION ELECTRIC COMPANY
                         CONSOLIDATED BALANCE SHEET
            (Unaudited) (In millions, except per share amounts)

                                                                                September 30,   December 31,
                                                                                     2003          2002
                                                                                -------------   ------------
                                   ASSETS
<S>                                                                             <C>             <C>
Current Assets:
 Cash and cash equivalents                                                      $     15         $      9
 Accounts receivable - trade (less allowance for doubtful
  accounts of $6 and $6, respectively)                                               222              171
 Unbilled revenue                                                                     98              101
 Miscellaneous accounts and notes receivable                                         126               49
 Materials and supplies, at average cost                                             182              162
 Other current assets                                                                 29               26
                                                                                --------         --------
   Total current assets                                                              672              518
                                                                                --------         --------
Property and Plant, Net                                                            6,070            5,991
Investments and Other Non-Current Assets:
 Nuclear decommissioning trust fund                                                  195              172
 Other assets                                                                        241              235
                                                                                --------         --------
   Total investments and other non-current assets                                    436              407
                                                                                --------         --------
Regulatory Assets                                                                    724              659
                                                                                --------         --------
           TOTAL ASSETS                                                         $  7,902         $  7,575
                                                                                ========         ========

                    LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities:
 Current maturities of long-term debt                                           $    235         $    130
 Short-term debt                                                                       -              250
 Borrowings from money pool                                                          230               15
 Accounts and wages payable                                                          164              348
 Taxes accrued                                                                       213              118
 Other current liabilities                                                            97               96
                                                                                --------         --------
   Total current liabilities                                                         939              957
                                                                                --------         --------
Long-term Debt, Net                                                                1,678            1,687
Deferred Credits and Other Non-Current Liabilities:
 Accumulated deferred income taxes, net                                            1,304            1,344
 Accumulated deferred investment tax credits                                         116              121
 Regulatory liabilities                                                              102              121
 Asset retirement obligations                                                        403              174
 Accrued pension liabilities                                                         261              252
 Other deferred credits and liabilities                                              185              174
                                                                                --------         --------
   Total deferred credits and other non-current liabilities                        2,371            2,186
                                                                                --------         --------
Commitments and Contingencies (Note 8)
Stockholder's Equity:
 Common stock, $5 par value, 150.0 shares authorized - 102.1 shares outstanding      511              511
 Preferred stock not subject to mandatory redemption                                 113              113
 Other paid-in capital, principally premium on common stock                          702              702
 Retained earnings                                                                 1,649            1,477
 Accumulated other comprehensive income (loss)                                       (61)             (58)
                                                                                --------         --------
   Total stockholder's equity                                                      2,914            2,745
                                                                                --------         --------
           TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY                           $  7,902         $  7,575
                                                                                ========         ========


The  accompanying  notes  as they  relate  to UE are an  integral  part of these
consolidated financial statements.

</TABLE>

                                       9

<PAGE>
<TABLE>
<CAPTION>

                             UNION ELECTRIC COMPANY
                        CONSOLIDATED STATEMENT OF INCOME
                            (Unaudited) (In millions)

                                                Three Months Ended   Nine Months Ended
                                                   September 30,        September 30,
                                             --------------------- --------------------
                                               2003       2002       2003        2002
                                             -------    -------    -------    ---------
<S>                                         <C>        <C>        <C>        <C>
Operating Revenues:
 Electric                                     $   801    $   841    $ 1,972    $ 2,029
 Gas                                               15         12        100         80
                                              -------    -------    -------    -------
      Total operating revenues                    816        853      2,072      2,109
                                              -------    -------    -------    -------
Operating Expenses:
 Fuel and purchased power                         153        157        418        433
 Gas purchased for resale                          10          7         62         49
 Other operations and maintenance                 192        201        564        592
 Coal contract settlement                         (51)         -        (51)         -
 Depreciation and amortization                     71         70        212        211
 Taxes other than income taxes                     61         67        168        174
                                              -------    -------    -------    -------
      Total operating expenses                    436        502      1,373      1,459
                                              -------    -------    -------    -------

Operating Income                                  380        351        699        650

Other Income and (Deductions):
    Miscellaneous income                            5          2         14         27
    Miscellaneous expense                          (2)        (1)        (5)       (32)
                                              -------    -------    -------    -------
      Total other income and (deductions)           3          1          9         (5)
                                              -------    -------    -------    -------

Interest Charges                                   23         26         74         78
                                              -------    -------    -------    -------

Income Before Income Taxes                        360        326        634        567

Income Taxes                                      135        120        234        203
                                              -------    -------    -------    -------

Net Income                                        225        206        400        364

Preferred Stock Dividends                           1          2          4          6
                                              -------    -------    -------    -------

Net Income Available to Common Stockholder    $   224    $   204    $   396    $   358
                                              =======    =======    =======    =======


The  accompanying  notes  as they  relate  to UE are an  integral  part of these
consolidated financial statements.

</TABLE>


                                       10
<PAGE>
<TABLE>
<CAPTION>

                         UNION ELECTRIC COMPANY
                  CONSOLIDATED STATEMENT OF CASH FLOWS
                        (Unaudited) (In millions)


                                                                      Nine Months Ended
                                                                         September 30,
                                                                    ---------------------
                                                                      2003         2002
                                                                    --------     ---------
<S>   <C>     <C>                                                   <C>       <C>
Cash Flows From Operating Activities:
  Net income                                                        $   400     $   364
  Adjustments to reconcile net income to net cash
     provided by operating activities:
      Depreciation and amortization                                     212         211
      Amortization of nuclear fuel                                       25          25
      Amortization of debt issuance costs and premium/discounts           3           3
      Deferred income taxes, net                                         16           7
      Deferred investment tax credits, net                               (5)         (5)
      Coal contract settlement                                          (45)          -
      Other                                                              (3)          3
      Changes in assets and liabilities:
         Receivables, net                                               (38)        (41)
         Materials and supplies                                         (20)         (7)
         Accounts and wages payable                                    (147)       (169)
         Taxes accrued                                                   95         207
         Assets, other                                                  (46)        (21)
         Liabilities, other                                              39         (18)
                                                                    -------     -------
Net cash provided by operating activities                               486         559
                                                                    -------     -------
Cash Flows From Investing Activities:
  Construction expenditures                                            (310)       (357)
  Nuclear fuel expenditures                                              (2)        (25)
  Advances to money pool                                                  -          84
  Other                                                                   4           7
                                                                    -------     -------
Net cash used in investing activities                                  (308)       (291)
                                                                    -------     -------

Cash Flows From Financing Activities:
  Dividends on common stock                                            (224)       (224)
  Dividends on preferred stock                                           (4)         (6)
  Capital issuance costs                                                 (5)         (1)
  Redemptions, repurchases, and maturities:
    Nuclear fuel lease                                                  (38)          -
    Short-term debt                                                    (250)       (186)
    Long-term debt                                                     (364)       (125)
    Preferred stock                                                       -         (41)
  Issuances:
    Nuclear fuel lease                                                    -          31
    Long-term debt                                                      498         173
    Borrowings from money pool                                          215         109
                                                                    -------     -------
Net cash used in financing activities                                  (172)       (270)
                                                                    -------     -------

Net change in cash and cash equivalents                                   6          (2)
Cash and cash equivalents at beginning of year                            9          15
                                                                    -------     -------
Cash and cash equivalents at end of period                          $    15     $    13
                                                                    =======     =======

Cash Paid During the Periods:
 Interest                                                           $    78     $    70
 Income taxes, net                                                      199          62


The  accompanying  notes  as they  relate  to UE are an  integral  part of these
consolidated financial statements.

</TABLE>


                                       11
<PAGE>

<TABLE>
<CAPTION>


                     CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
                                  BALANCE SHEET
                            (Unaudited) (In millions)

                                                                                September 30,  December 31,
                                                                                    2003          2002
                                                                                ------------  -----------
                                  ASSETS
<S>                                                                             <C>             <C>
Current Assets:
 Cash and cash equivalents                                                       $     17        $    17
 Accounts receivable - trade (less allowance for doubtful
   accounts of $1 and $1, respectively)                                                50             53
 Unbilled revenue                                                                      59             74
 Advances to money pool                                                                 -             16
 Miscellaneous accounts and notes receivable                                           22             22
 Current portion of intercompany note receivable - Genco                               49             46
 Current portion of intercompany tax receivable - Genco                                13             13
 Materials and supplies, at average cost                                               57             41
 Other current assets                                                                   7              7
                                                                                 --------        -------
   Total current assets                                                               274            289
                                                                                 --------        -------
Property and Plant, Net                                                               823            825
Investments and Other Non-Current Assets:
 Intercompany note receivable - Genco                                                 324            373
 Intercompany tax receivable - Genco                                                  153            162
 Other assets                                                                          18             17
                                                                                 --------        -------
   Total investments and other non-current assets                                     495            552
                                                                                 --------        -------
Regulatory Assets                                                                      28             31
                                                                                 --------        -------
           TOTAL ASSETS                                                          $  1,620        $ 1,697
                                                                                 ========        =======


                   LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities:
 Current maturities of long-term debt                                            $      -        $    45
 Accounts and wages payable                                                           110             87
 Borrowings from money pool                                                            23              -
 Taxes accrued                                                                         34             32
 Other current liabilities                                                             29             26
                                                                                 --------        -------
   Total current liabilities                                                          196            190
                                                                                 --------        -------
Long-term Debt, Net                                                                   485            534
Deferred Credits and Other Non-Current Liabilities:
 Accumulated deferred income taxes, net                                               271            282
 Accumulated deferred investment tax credits                                           12             13
 Regulatory liabilities                                                                14             15
 Other deferred credits and liabilities                                                78             71
                                                                                 --------        -------
   Total deferred credits and other non-current liabilities                           375            381
                                                                                 --------        -------
Commitments and Contingencies (Note 8)
Stockholder's Equity:
 Common stock, no par value, 45.0 shares authorized - 25.5 shares outstanding         120            120
 Preferred stock not subject to mandatory redemption                                   80             80
 Retained earnings                                                                    380            405
 Accumulated other comprehensive income (loss)                                        (16)           (13)
                                                                                 --------        -------
   Total stockholder's equity                                                         564            592
                                                                                 --------        -------
           TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY                            $  1,620        $ 1,697
                                                                                 ========        =======


The  accompanying  notes as they  relate to CIPS are an  integral  part of these
financial statements.

</TABLE>

                                       12
<PAGE>
<TABLE>
<CAPTION>

         CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
                   STATEMENT OF INCOME
                (Unaudited) (In millions)


                                            Three Months Ended  Nine Months Ended
                                             September 30,        September 30,
                                            ----------------    ------------------
                                              2003     2002      2003      2002
                                            -------  -------    --------  --------
<S><C><C>                                   <C>     <C>        <C>      <C>
Operating Revenues:
   Electric                                  $ 176   $ 209      $ 445    $ 520
   Gas                                          20      15        127      106
                                             -----   -----      -----    -----
      Total operating revenues                 196     224        572      626
                                             -----   -----      -----    -----

Operating Expenses:
   Purchased power                              96     117        264      323
   Gas purchased for resale                      9       6         80       62
   Other operations and maintenance             41      39        121      120
   Depreciation and amortization                13      13         39       38
   Taxes other than income taxes                 6       6         22       21
                                             -----   -----      -----    -----
      Total operating expenses                 165     181        526      564
                                             -----   -----      -----    -----

Operating Income                                31      43         46       62

Other Income and (Deductions):
     Miscellaneous income                        7       8         21       25
     Miscellaneous expense                       -       -         (2)      (1)
                                             -----   -----      -----    -----
      Total other income and (deductions)        7       8         19       24
                                             -----   -----      -----    -----

Interest Charges                                 8      11         26       31
                                             -----   -----      -----    -----

Income Before Income Taxes                      30      40         39       55

Income Taxes                                     4      16          8       21
                                             -----   -----      -----    -----

Net Income                                      26      24         31       34

Preferred Stock Dividends                        1       1          2        3
                                             -----   -----      -----    -----

Net Income Available to Common Stockholder   $  25   $  23      $  29    $  31
                                             =====   =====      =====    =====


The  accompanying  notes as they  relate to CIPS are an  integral  part of these
financial statements.

</TABLE>


                                       13

<PAGE>
<TABLE>
<CAPTION>

                     CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
                             STATEMENT OF CASH FLOWS
                            (Unaudited) (In millions)

                                                                          Nine Months Ended
                                                                           September 30,
                                                                      ----------------------------
                                                                         2003            2002
                                                                      -----------     -----------

<S><C><C>                                                           <C>              <C>
Cash Flows From Operating Activities:
 Net income                                                          $     31         $     34
 Adjustments to reconcile net income to net cash
   provided by operating activities:
    Depreciation and amortization                                          39               38
    Amortization of debt issuance costs and premium/discounts               1                1
    Deferred income taxes, net                                            (11)             (12)
    Deferred investment tax credits, net                                   (1)              (1)
    Other                                                                  (3)               -
    Changes in assets and liabilities:
       Receivables, net                                                    18               (4)
       Materials and supplies                                             (16)              (1)
       Accounts and wages payable                                          23              (36)
       Taxes accrued                                                        2               28
       Assets, other                                                        9               25
       Liabilities, other                                                  10               (1)
                                                                     --------         --------
Net cash provided by operating activities                                 102               71
                                                                     --------         --------

Cash Flows From Investing Activities:
 Construction expenditures                                                (36)             (41)
 Advances to money pool                                                    62               43
                                                                     --------         --------
Net cash provided by investing activities                                  26                2
                                                                     --------         --------

Cash Flows From Financing Activities:
 Dividends on common stock                                                (54)             (47)
 Dividends on preferred stock                                              (2)              (3)
 Redemptions, repurchases, and maturities:
  Long-term debt                                                          (95)             (33)
 Issuances:
  Borrowings from money pool                                               23                -
                                                                     --------         --------
Net cash used in financing activities                                    (128)             (83)
                                                                     --------         --------

Net change in cash and cash equivalents                                     -              (10)
Cash and cash equivalents at beginning of year                             17               26
                                                                     --------         --------
Cash and cash equivalents at end of period                           $     17         $     16
                                                                     ========         ========

Cash Paid During the Periods:
 Interest                                                            $     23         $     26
 Income taxes, net                                                         18                6


The  accompanying  notes as they  relate to CIPS are an  integral  part of these
financial statements.

</TABLE>

                                       14
<PAGE>
<TABLE>
<CAPTION>


                      AMEREN ENERGY GENERATING COMPANY
                                BALANCE SHEET
                  (Unaudited) (In millions, except shares)

                                                                                    September 30,     December 31,
                                                                                        2003              2002
                                                                                    ------------      ------------
                                   ASSETS

<S>                                                                                 <C>              <C>
Current Assets:
  Cash and cash equivalents                                                         $      2         $      3
  Accounts receivable                                                                    143               78
  Miscellaneous accounts and notes receivable                                              -               71
  Materials and supplies, at average cost                                                 95               77
  Other current assets                                                                     4                2
                                                                                     --------         --------
    Total current assets                                                                 244              231
Property and Plant, Net                                                                1,766            1,767
Other Non-Current Assets                                                                  13               12
                                                                                    --------         --------
          TOTAL ASSETS                                                              $  2,023         $  2,010
                                                                                    ========         ========


                        LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities:
  Accounts and wages payable                                                        $     70         $     87
  Borrowings from money pool                                                             177              191
  Current portion of intercompany notes payable - CIPS and Ameren                         53               50
  Current portion of intercompany tax payable - CIPS                                      13               13
  Other current liabilities                                                               41               17
                                                                                    --------         --------
    Total current liabilities                                                            354              358
                                                                                    --------         --------
Long-term Debt, Net                                                                      698              698
Intercompany Notes Payable - CIPS and Ameren                                             358              412
Deferred Credits and Other Non-Current Liabilities:
  Accumulated deferred income taxes, net                                                 104               66
  Accumulated deferred investment tax credits                                             14               15
  Intercompany tax payable - CIPS                                                        153              162
  Other deferred credits and liabilities                                                  20               19
                                                                                    --------         --------
    Total deferred credits and other non-current liabilities                             291              262
                                                                                    --------         --------
Commitments and Contingencies (Note 8)
Stockholder's Equity:
  Common stock, no par value, 10,000 shares authorized - 2,000 shares outstanding          -                -
  Other paid-in capital                                                                  150              150
  Retained earnings                                                                      174              131
  Accumulated other comprehensive income (loss)                                           (2)              (1)
                                                                                    --------         --------
    Total stockholder's equity                                                           322              280
                                                                                    --------         --------
          TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY                                $  2,023         $  2,010
                                                                                    ========         ========


The  accompanying  notes as they relate to Genco are an  integral  part of these
financial statements.

</TABLE>
                                       15

<PAGE>
<TABLE>
<CAPTION>

                        AMEREN ENERGY GENERATING COMPANY
                               STATEMENT OF INCOME
                            (Unaudited) (In millions)


                                                                Three Months Ended        Nine Months Ended
                                                                  September 30,             September 30,
                                                             -------------------------  -------------------------
                                                                2003         2002         2003         2002
                                                             -----------  ------------  ------------ ------------
<S>                                                         <C>          <C>           <C>          <C>
Operating Revenues:
 Electric                                                    $    216      $   207      $   594      $   560
 Other                                                              1            -            2            -
                                                             --------      -------      -------      -------
   Total operating revenues                                       217          207          596          560
                                                             --------      -------      -------      -------

Operating Expenses:
 Fuel and purchased power                                         102          101          263          259
 Other operations and maintenance                                  38           38          108          122
 Depreciation and amortization                                     19           17           56           50
 Taxes other than income taxes                                      5            2           18           14
                                                             --------      -------      -------      -------
   Total operating expenses                                       164          158          445          445
                                                             --------      -------      -------      -------

Operating Income                                                   53           49          151          115

Other Income and (Deductions):
  Miscellaneous income                                              -            -            2            -
  Miscellaneous expense                                             -           (1)           -           (1)
                                                             --------      -------      -------      --------
   Total other income and (deductions)                              -           (1)           2           (1)
                                                             --------      -------      -------      --------
Interest Charges                                                   25           23           76           63
                                                             --------      -------      -------      --------

Income Before Income Taxes and Cumulative Effect of
  Change in Accounting Principle                                   28           25           77           51

Income Taxes                                                       11           10           30           20
                                                             --------      -------      -------      -------

Income Before Cumulative Effect of Change in Accounting
  Principle                                                        17           15           47           31

Cumulative Effect of Change in Accounting Principle,
  Net of Income Taxes                                               -            -           18            -
                                                             --------      -------      -------      -------

Net Income                                                   $     17      $    15      $    65      $    31
                                                             ========      =======      =======      =======


The  accompanying  notes as they relate to Genco are an  integral  part of these
financial statements.

</TABLE>

                                       16
<PAGE>

<TABLE>
<CAPTION>

                        AMEREN ENERGY GENERATING COMPANY
                             STATEMENT OF CASH FLOWS
                            (Unaudited) (In millions)


                                                                             Nine Months Ended
                                                                               September 30,
                                                                             -----------------
                                                                              2003      2002
                                                                             -------   -------

   <S>                                                                        <C>      <C>
  Cash Flows From Operating Activities:
   Net income                                                                $  65    $  31
   Adjustments to reconcile net income to net cash
     provided by operating activities:
      Cumulative effect of change in accounting principle                      (18)       -
      Amortization of debt issuance costs and discounts                          1        1
      Depreciation and amortization                                             56       50
      Deferred income taxes, net                                                37       20
      Deferred investment tax credits, net                                      (1)      (1)
      Other                                                                     (1)       -
      Changes in assets and liabilities:
         Accounts receivable                                                   (63)      43
         Materials and supplies                                                (18)       3
         Taxes receivable, net                                                  64      (12)
         Accounts and wages payable                                             (4)      15
         Assets, other                                                          (1)     (17)
         Liabilities, other                                                      8       17
                                                                             -----    -----
  Net cash provided by operating activities                                    125      150
                                                                             -----    -----

  Cash Flows From Investing Activities:
   Construction expenditures                                                   (39)    (268)
   Advances to money pool                                                        -      (32)
                                                                             -----    -----
  Net cash used in investing activities                                        (39)    (300)
                                                                             -----    -----

  Cash Flows From Financing Activities:
   Dividends on common stock                                                   (22)     (12)
   Debt issuance costs                                                           -       (4)
   Redemptions, repurchases, and maturities:
     Borrowings from money pool                                                (14)     (62)
     Intercompany notes payable - CIPS and Ameren                              (51)     (46)
   Issuances:
     Long-term debt                                                              -      275
                                                                             -----    -----
  Net cash provided by (used in) financing activities                          (87)     151
                                                                              -----    -----

  Net change in cash and cash equivalents                                       (1)       1
  Cash and cash equivalents at beginning of year                                 3        2
                                                                             -----    -----
  Cash and cash equivalents at end of period                                 $   2    $   3
                                                                             =====    =====

  Cash Paid During the Periods:
   Interest                                                                  $  60    $  44
   Income taxes (refunded) paid                                                (66)       4


The  accompanying  notes as they relate to Genco are an  integral  part of these
financial statements.

</TABLE>

                                       17
<PAGE>

<TABLE>
<CAPTION>


                                  CILCORP INC.
                           CONSOLIDATED BALANCE SHEET
                            (Unaudited) (In millions)

                                                                     September 30, |  December 31,
                                                                        2003       |     2002
                                                                     ------------  |  --------------
                                                                      Successor    |   Predecessor
                                                                     ------------  |  --------------
                                     ASSETS                                        |
                                                                                   |
<S>                                                                  <C>              <C>
Current Assets:                                                                    |
  Cash and cash equivalents                                           $     9      |   $    32
  Accounts receivables - trade (less allowance for doubtful                        |
    accounts of $3 and $2, respectively)                                   51      |        53
  Unbilled revenue                                                         23      |        37
  Miscellaneous accounts and notes receivable                               8      |         8
  Materials and supplies, at average cost                                 123      |        61
  Other current assets                                                      7      |        24
                                                                      -------      |   -------
    Total current assets                                                  221      |       215
                                                                      -------      |   -------
Property and Plant, Net                                                 1,188      |       914
Investments and Other Non-Current Assets:                                          |
  Investments                                                             130      |       133
  Goodwill and other intangibles, net                                     629      |       581
  Other assets                                                             23      |        50
                                                                      -------      |   -------
    Total investments and other non-current assets                        782      |       764
                                                                      -------      |   -------
Regulatory Assets                                                          15      |         8
                                                                      -------      |   -------
           TOTAL ASSETS                                               $ 2,206      |   $ 1,901
                                                                      =======      |   =======
                                                                                   |
                                                                                   |
                        LIABILITIES AND STOCKHOLDER'S EQUITY                       |
Current Liabilities:                                                               |
  Current maturities of long-term debt                                $   100      |   $    27
  Short-term debt                                                           -      |        10
  Borrowings from money pool                                              109      |         -
  Intercompany note payable - Ameren                                       31      |         -
  Accounts and wages payable                                               88      |        76
  Taxes accrued                                                             4      |         8
  Other current liabilities                                                48      |        40
                                                                      -------      |   -------
    Total current liabilities                                             380      |       161
                                                                      -------      |   -------
Long-term Debt, Net                                                       671      |       791
Preferred Stock of Subsidiary Subject to Mandatory Redemption              21      |         -
Deferred Credits and Other Non-Current Liabilities:                                |
  Accumulated deferred income taxes, net                                  306      |       190
  Accumulated deferred investment tax credits                              12      |        13
  Regulatory liabilities                                                   17      |        19
  Accrued pension liabilities                                             133      |       107
  Other deferred credits and liabilities                                  158      |        84
                                                                      -------      |   -------
    Total deferred credits and other non-current liabilities              626      |       413
                                                                      -------      |   -------
Preferred Stock of Subsidiary Subject to Mandatory Redemption               -      |        22
Preferred Stock of Subsidiary Not Subject to Mandatory Redemption          19      |        19
Commitments and Contingencies (Note 8)                                             |
Stockholder's Equity:                                                              |
  Other paid-in capital                                                   489      |       519
  Retained earnings                                                         4      |        35
  Accumulated other comprehensive income (loss)                            (4)     |       (59)
                                                                      -------      |   -------
    Total stockholder's equity                                            489      |       495
                                                                      -------      |   -------
           TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY                 $ 2,206      |   $ 1,901
                                                                      =======      |   =======
                                                                                   |
                                                                                   |
The  accompanying  notes as they relate to CILCORP are an integral part of these   |
consolidated financial statements.                                                 |

</TABLE>
                                       18

<PAGE>
<TABLE>
<CAPTION>


                                  CILCORP INC.
                        CONSOLIDATED STATEMENT OF INCOME
                            (Unaudited) (In millions)

                                                    ----------Successor--------- | ----------------Predecessor----------------
                                                      Three            Eight     |                  Three          Nine
                                                      Months           Months    |                  Months         Months
                                                      Ended            Ended     |                  Ended          Ended
                                                    September 30,   September 30,|    January     September 30,   September 30,
                                                    --------------  ------------ | -----------  ---------------   -------------
                                                         2003           2003     |     2003          2002             2002
                                                    --------------  ------------ | -----------  --------------    -------------
                                                                                 |
<S>  <C>                                           <C>             <C>             <C>           <C>             <C>
Operating Revenues:                                                              |
 Electric                                           $       168     $       373  |  $       47    $       167     $       396
 Gas                                                         46             215  |          58             37             185
 Other                                                        1               3  |           -              1               4
                                                    -----------     -----------  | -----------    -----------     -----------
     Total operating revenues                               215             591  |         105            205             585
                                                    -----------     -----------  | -----------    -----------     -----------
                                                                                 |
Operating Expenses:                                                              |
 Fuel and purchased power                                    85             192  |          24             70             180
 Gas purchased for resale                                    32             166  |          44             24             126
 Other operations and maintenance                            38              95  |          14             30             101
 Depreciation and amortization                               18              54  |           6             18              54
 Taxes other than income taxes                                9              26  |           4             10              31
                                                    -----------     -----------  | -----------    -----------     -----------
     Total operating expenses                               182             533  |          92            152             492
                                                    -----------     -----------  | -----------    -----------     -----------
                                                                                 |
Operating Income                                             33              58  |          13             53              93
                                                                                 |
Other Income and (Deductions):                                                   |
    Miscellaneous income                                      -               -  |           -              -               2
    Miscellaneous expense                                    (2)             (3) |           -              -              (2)
                                                    -----------     -----------  | -----------    -----------     -----------
     Total other income and (deductions)                     (2)             (3) |           -              -               -
                                                    -----------     -----------  | -----------    -----------     -----------
Interest Charges and Preferred Dividends:                                        |
 Interest                                                    15              35  |           5             16              48
 Preferred dividends of subsidiaries                          -               1  |           -              1               2
                                                    -----------     -----------  | -----------    -----------     -----------
     Net interest charges and preferred dividends            15              36  |           5             17              50
                                                    -----------     -----------  | -----------    -----------     -----------
                                                                                 |
Income Before Income Taxes and Cumulative Effect of                              |
  Change in Accounting Principle                             16              19  |           8             36              43
                                                                                 |
Income Taxes                                                  5               5  |           3             13              14
                                                    -----------     -----------  | -----------    -----------     -----------
                                                                                 |
Income Before Cumulative Effect of Change in                                     |
  Accounting Principle                                       11              14  |           5             23              29
                                                                                 |
Cumulative Effect of Change in Accounting Principle,                             |
  Net of Income Taxes                                         -               -  |           4              -               -
                                                    -----------     -----------  | -----------    -----------     -----------
                                                                                 |
Net Income                                          $        11     $        14  | $         9    $        23     $        29
                                                    ===========     ===========  |  ===========    ===========    ===========
                                                                                 |
                                                                                 |
The accompanying notes as they relate to CILCORP are an integral part of these   |
consolidated financial statements.                                               |

</TABLE>

                                       19

<PAGE>
<TABLE>
<CAPTION>

                                  CILCORP INC.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                            (Unaudited) (In millions)

                                                                       ---Successor-- | ---------Predecessor-------
                                                                           Eight      |                  Nine
                                                                           Months      |                 Months
                                                                           Ended      |                  Ended
                                                                        September 30, |   January     September 30,
                                                                       -------------- | -----------  --------------
                                                                           2003       |    2003         2002
                                                                       -------------- | -----------  --------------
                                                                                      |
<S>  <C>                                                              <C>               <C>          <C>
Cash Flows From Operating Activities:                                                 |
  Net income                                                           $    14        |  $     9       $    29
  Adjustments to reconcile net income to net cash                                     |
    provided by operating activities:                                                 |
     Cumulative effect of change in accounting principle                     -        |       (4)            -
     Depreciation and amortization                                          54        |        6            54
     Amortization of debt issuance costs and premium/discounts               1        |        -             -
     Deferred income taxes, net                                             (5)       |       (5)            2
     Deferred investment tax credits, net                                   (1)       |        -            (2)
     Other                                                                  (9)       |        -             6
     Changes in assets and liabilities:                                               |
         Receivables, net                                                   36        |      (20)            4
         Materials and supplies                                            (18)       |       13             4
         Accounts and wages payable                                        (37)       |       20           (15)
         Taxes accrued                                                      (3)       |       11             8
         Assets, other                                                       5        |        6             4
         Liabilities, other                                                  7        |       (5)            2
                                                                       -------        |  -------       -------
Net cash provided by operating activities                                   44        |       31            96
                                                                       -------        |  -------       -------
                                                                                      |
Cash Flows From Investing Activities:                                                 |
  Construction expenditures                                                (52)       |      (16)          (96)
  Other                                                                      3        |        1             3
                                                                       -------        |  -------       -------
Net cash used in investing activities                                      (49)       |      (15)          (93)
                                                                       -------        |  -------       -------
                                                                                      |
Cash Flows From Financing Activities:                                                 |
  Dividends on common stock                                                (10)       |        -             -
  Redemptions, repurchases, and maturities:                                           |
    Short-term debt                                                          -        |      (10)          (63)
    Long-term debt                                                        (153)       |        -            (1)
    Preferred stock                                                         (1)       |        -             -
  Issuances:                                                                          |
    Long-term debt                                                           -        |        -           100
    Borrowings from money pool                                             109        |        -             -
    Intercompany note payable - Ameren                                      31        |        -             -
                                                                       -------        |  -------       -------
Net cash provided by (used in) financing activities                        (24)       |      (10)           36
                                                                       -------        |  -------       -------
                                                                                      |
Net change in cash and cash equivalents                                    (29)       |        6            39
Cash and cash equivalents at beginning of year                              38        |       32            18
                                                                       -------        |  -------       -------
Cash and cash equivalents at end of period                             $     9        |  $    38       $    57
                                                                       =======        |  =======       =======
                                                                                      |
Cash Paid During the Periods:                                                         |
  Interest                                                             $    14        |  $     5       $    44
  Income taxes, net                                                         10        |        -             5
                                                                                      |
                                                                                      |
The  accompanying  notes as they relate to CILCORP are an integral part of these      |
consolidated financial statements.                                                    |

</TABLE>
                                       20


<PAGE>

<TABLE>
<CAPTION>

                    CENTRAL ILLINOIS LIGHT COMPANY
                      CONSOLIDATED BALANCE SHEET
                       (Unaudited) (In millions)

                                                                                        September 30,     December 31,
                                                                                             2003             2002
                                                                                         -----------      ------------
                                ASSETS
<S>                                                                                      <C>             <C>
Current Assets:
 Cash and cash equivalents                                                               $      3        $    22
 Accounts receivable - trade (less allowance for doubtful
   accounts of $3 and $2, respectively)                                                        51             47
 Unbilled revenue                                                                              22             32
 Miscellaneous accounts and notes receivable                                                    6              7
 Materials and supplies, at average cost                                                       71             61
 Other current assets                                                                           7             24
                                                                                         --------        -------
   Total current assets                                                                       160            193
                                                                                         --------        -------
Property and Plant, Net                                                                       950            890
Other Non-Current Assets                                                                       21             18
Regulatory Assets                                                                              15              8
                                                                                         --------        -------
           TOTAL ASSETS                                                                  $  1,146        $ 1,109
                                                                                         ========        =======


                   LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities:
 Current maturities of long-term debt                                                    $    100        $    27
 Short-term debt                                                                                -             10
 Borrowings from money pool                                                                   109              -
 Accounts and wages payable                                                                    81             68
 Taxes accrued                                                                                 12             18
 Other current liabilities                                                                     29             31
                                                                                         --------        -------
   Total current liabilities                                                                  331            154
                                                                                         --------        -------
Long-term Debt, Net                                                                           138            316
Preferred Stock Subject to Mandatory Redemption                                                21              -
Deferred Credits and Other Non-Current Liabilities:
 Accumulated deferred income taxes, net                                                       105             95
 Accumulated deferred investment tax credits                                                   12             13
 Regulatory liabilities                                                                        17             19
 Accrued pension liabilities                                                                   98             85
 Other deferred credits and liabilities                                                        76             63
                                                                                         --------        -------
   Total deferred credits and other non-current liabilities                                   308            275
                                                                                         --------        -------
Preferred Stock Subject to Mandatory Redemption                                                 -             22
Commitments and Contingencies (Note 8)
Stockholder's Equity:
 Common stock, no par value, 20.0 shares authorized - 13.6 shares outstanding                 186            186
 Preferred stock not subject to mandatory redemption                                           19             19
 Other paid-in capital                                                                         52             52
 Retained earnings                                                                            124            114
 Accumulated other comprehensive income (loss)                                                (33)           (29)
                                                                                         --------        -------
   Total stockholder's equity                                                                 348            342
                                                                                         --------        -------
           TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY                                    $  1,146        $ 1,109
                                                                                         ========        =======


The  accompanying  notes as they relate to CILCO are an  integral  part of these
consolidated financial statements.

</TABLE>


                                       21

<PAGE>
<TABLE>
<CAPTION>


               CENTRAL ILLINOIS LIGHT COMPANY
              CONSOLIDATED STATEMENT OF INCOME
                  (Unaudited) (In millions)

                                                                 Three Months Ended         Nine Months Ended
                                                                     September 30,            September 30,
                                                              -------------------------  ----------------------
                                                                   2003         2002        2003         2002
                                                              ------------    ---------  ----------   ---------
<S> <C>                                                         <C>          <C>          <C>          <C>
Operating Revenues:
 Electric                                                        $  168        $ 167       $ 420        $ 396
 Gas                                                                 35           28         201          150
                                                                  -----        -----       -----        -----
      Total operating revenues                                      203          195         621          546
                                                                  -----        -----       -----        -----

Operating Expenses:
 Fuel and purchased power                                            85           70         214          180
 Gas purchased for resale                                            21           15         136           91
 Other operations and maintenance                                    43           30         123          100
 Depreciation and amortization                                       16           18          53           53
 Taxes other than income taxes                                        9           10          30           31
                                                                  -----        -----       -----        -----
      Total operating expenses                                      174          143         556          455
                                                                  -----        -----       -----        -----

Operating Income                                                     29           52          65           91

Other Income and (Deductions):
    Miscellaneous income                                              -            -           1            1
    Miscellaneous expense                                            (2)           -          (4)          (2)
                                                                  -----        -----       -----        -----
      Total other income and (deductions)                            (2)           -          (3)          (1)
                                                                  -----        -----       -----        -----

Interest Charges                                                      3            6          13           16
                                                                  -----        -----       -----        -----

Income Before Income Taxes and Cumulative Effect of Change
  in Accounting Principle                                            24           46          49           74

Income Taxes                                                          9           17          18           27
                                                                  -----        -----       -----        -----

Income Before Cumulative Effect of Change in Accounting
  Principle                                                          15           29          31           47

Cumulative Effect of Change in Accounting Principle,
      Net of Income Taxes                                             -            -          24            -
                                                                  -----        -----       -----        -----

Net Income                                                           15           29          55           47

Preferred Stock Dividends                                             -            1           1            2
                                                                  -----        -----       -----        -----

Net Income Available to Common Stockholder                        $  15        $  28       $  54        $  45
                                                                  =====        =====       =====        =====


The  accompanying  notes as they relate to CILCO are an  integral  part of these
consolidated financial statements.


</TABLE>
                                       22


<PAGE>
<TABLE>
<CAPTION>


                  CENTRAL ILLINOIS LIGHT COMPANY
               CONSOLIDATED STATEMENT OF CASH FLOWS
                    (Unaudited) (In millions)
                                                                     Nine Months Ended
                                                                        September 30,
                                                                  -----------------------
                                                                     2003          2002
                                                                  -----------   ---------

<S>     <C>                                                      <C>         <C>
Cash Flows From Operating Activities:
 Net income                                                      $     55       $     47
 Adjustments to reconcile net income to net cash
   provided by operating activities:
    Cumulative effect of change in accounting principle               (24)             -
    Depreciation and amortization                                      53             53
    Deferred income taxes, net                                         (8)             2
    Deferred investment tax credits, net                               (1)            (2)
    Other                                                              (4)             6
    Changes in assets and liabilities:
       Receivables, net                                                 7              4
       Materials and supplies                                         (10)             3
       Accounts and wages payable                                      13            (25)
       Taxes accrued                                                   (6)            14
       Assets, other                                                    6              3
       Liabilities, other                                              19             (8)
                                                                 --------       --------
Net cash provided by operating activities                             100             97
                                                                 --------       --------

Cash Flows From Investing Activities:
 Construction expenditures                                            (68)           (96)
 Other                                                                  1              1
                                                                 --------       --------
Net cash used in investing activities                                 (67)           (95)
                                                                 --------       --------

Cash Flows From Financing Activities:
 Dividends on common stock                                            (44)           (28)
 Dividends on preferred stock                                          (1)            (2)
 Redemptions, repurchases, and maturities:
   Short-term debt                                                    (10)           (43)
   Long-term debt                                                    (105)            (1)
   Preferred stock                                                     (1)             -
 Issuances:
   Long-term debt                                                       -            100
   Borrowings from money pool                                         109              -
                                                                 --------       --------
Net cash provided by (used in) financing activities                   (52)            26
                                                                 --------       --------

Net change in cash and cash equivalents                               (19)            28
Cash and cash equivalents at beginning of year                         22             12
                                                                 --------       --------
Cash and cash equivalents at end of period                       $      3       $     40
                                                                 ========       ========

Cash Paid During the Periods:
 Interest                                                        $     17       $     24
 Income taxes, net                                                     11             15


The  accompanying  notes as they relate to CILCO are an  integral  part of these
consolidated financial statements.

</TABLE>

                                       23


<PAGE>

AMEREN CORPORATION (CONSOLIDATED)
UNION ELECTRIC COMPANY (CONSOLIDATED)
CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
AMEREN ENERGY GENERATING COMPANY
CILCORP INC. (CONSOLIDATED)
CENTRAL ILLINOIS LIGHT COMPANY (CONSOLIDATED)

COMBINED NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
September 30, 2003

NOTE 1 - Summary of Significant Accounting Policies

General

     Ameren is a public utility  holding  company  registered with the SEC under
the PUHCA and is headquartered in St. Louis,  Missouri. Our principal businesses
are involved in the generation,  transmission  and  distribution of electricity,
and the distribution of natural gas, to residential,  commercial, industrial and
wholesale users in the central United States.  Ameren's  principal  subsidiaries
are as follows:

o    UE, which operates a rate-regulated  electric generation,  transmission and
     distribution  business,  and  a  rate-regulated  natural  gas  distribution
     business in Missouri and Illinois.
o    CIPS, which operates a rate-regulated electric and natural gas transmission
     and distribution business in Illinois.
o    CILCO,  a  subsidiary  of  CILCORP (a holding  company),  which  operates a
     rate-regulated  electric  transmission  and  distribution  business,  a non
     rate-regulated  electric  generation  business (AERG), and a rate-regulated
     natural  gas  distribution  business  in  Illinois.  Ameren  completed  its
     acquisition of CILCORP on January 31, 2003.  See Note 2 - Acquisitions  for
     further information.
o    Resources  Company,  which  consists  of  non  rate-regulated   operations.
     Subsidiaries  include Genco, which operates a non  rate-regulated  electric
     generation  business in Illinois and  Missouri;  Marketing  Company,  which
     markets power for periods primarily over one year; AFS, which procures fuel
     and manages the related risks for Ameren's affiliated companies; and Medina
     Valley, which indirectly owns a 40 megawatt,  gas-fired electric generation
     plant.  Ameren completed its acquisition of AES Medina Valley Cogen (No. 4)
     LLC on February 4, 2003. See Note 2 - Acquisitions for further information.
o    Ameren Energy,  which serves as a power marketing and risk management agent
     for Ameren and its subsidiaries for transactions of primarily less than one
     year.
o    EEI, which operates electric generation and transmission facilities in
     Illinois. Ameren has a 60% ownership interest in EEI through UE, which owns
     40%, and Resources Company, which owns 20%. Ameren consolidates EEI for
     financial reporting purposes, while UE and Resources Company report EEI
     under the equity method.
o    Ameren Services, which provides a variety of shared support services to us.

     In  October  2003,  CILCO  transferred  its Duck  Creek  and E. D.  Edwards
coal-fired  plants  and  its  Sterling  Avenue  combustion   turbine  facilities
representing  in  the  aggregate   approximately  1,100  megawatts  of  electric
generating capacity to its wholly-owned subsidiary, AERG, in exchange for all of
the outstanding stock of AERG and AERG's assumption of certain liabilities.  The
net book value of the transferred  assets was approximately  $378 million and no
gain or loss was recognized as the  transaction  was accounted for as a transfer
between entities under common control.  Approximately  23% of CILCO's  employees
were transferred to AERG as a part of the transaction.

     When  we  refer  to  our,  we or  us,  it  indicates  that  the  referenced
information  is common to all Ameren  Companies.  When we refer to  financing or
acquisition  activities,  we are defining Ameren as the parent holding  company.
When  appropriate,  our  subsidiaries  are  specifically  referenced in order to
distinguish among their different business activities.

     The financial statements of Ameren, UE, CILCORP and CILCO are prepared on a
consolidated  basis and therefore  include the accounts of their  majority-owned
subsidiaries.  Results of CILCORP and CILCO  reflected in Ameren's  consolidated
financial statements include the period from the acquisition date of January 31,
2003 through  September  30, 2003.  January 2003 and prior year data for CILCORP
and CILCO is not included in Ameren's consolidated totals. See


                                       24
<PAGE>

Note 2 - Acquisitions  for further  information.  All  significant  intercompany
transactions  have been eliminated.  All tabular dollar amounts are in millions,
unless otherwise indicated.

     In  order  to be  more  consistent  with  industry  reporting  trends,  our
Statements of Income in this filing have been reclassified to present all income
taxes as one line item. Previously, we reported a portion of our income taxes in
Operating  Expenses  and a portion in Other Income and  Deductions.  This change
results in our calculation of Operating Income now being on a pre-tax basis with
no effect on net income. Additionally, our Balance Sheet presentations have been
reformatted to change the order in which current and  non-current  items appear,
with no effect on total assets, total liabilities or any sub-categories included
on our Balance Sheet.

     Our  accounting  policies  conform to GAAP,  and our financial  statements,
while  unaudited,  reflect all  adjustments  (which  include  normal,  recurring
adjustments)  necessary,  in our opinion, for a fair presentation of our interim
results.  Certain  information  and footnote  disclosures  normally  included in
annual audited financial  statements  prepared in accordance with GAAP have been
omitted  pursuant  to the rules and  regulations  of the SEC.  As the  unaudited
interim  financial  statements  included  herein  do  not  include  all  of  the
information  and footnote  disclosures  required by GAAP, they should be read in
conjunction with the financial  statements and the notes thereto included in the
respective 2002 Annual Reports on Form 10-K of the Ameren Companies.

     The  preparation of financial  statements in conformity  with GAAP requires
management to make estimates and  assumptions.  Such  estimates and  assumptions
affect the  reported  amounts  of assets  and  liabilities,  the  disclosure  of
contingent assets and liabilities at the dates of financial statements,  and the
reported  amounts of revenues and expenses  during the reporting  periods.  As a
result,  actual  results  could  differ  from those  estimates.  The  results of
operations for an interim period may not give a true indication of results for a
full year.

     As permitted by rules of the SEC, Ameren did not "push down" the effects of
purchase   accounting   to  the   financial   statements  of  any  of  CILCORP's
subsidiaries.   Accordingly,  CILCORP's  post-acquisition  financial  statements
reflect a new basis of accounting,  and separate financial statement amounts are
presented for  pre-acquisition  (predecessor) and  post-acquisition  (successor)
periods,  separated  by a bold black  line.  CILCO's  financial  statements  are
presented on a historical  basis of accounting for all periods  presented.  As a
result  of  the   acquisition   of  CILCORP  on  January   31,   2003,   certain
reclassifications  have been made to CILCORP's and CILCO's prior year  financial
statements to conform to our current presentation.

Earnings Per Share

     There  was no  material  difference  between  Ameren's  basic  and  diluted
earnings per share amounts for the three and nine month periods ended  September
30,  2003  (2002 - $0.01  difference).  The  dilutive  component  in each of the
periods was comprised of assumed stock option  conversions,  which increased the
number of shares  outstanding in the diluted  earnings per share  calculation by
283,769  shares for the three months ended  September  30, 2003 (2002 - 340,210)
and  273,914  shares  for the nine  months  ended  September  30,  2003  (2002 -
345,650). Ameren's equity security units have no dilutive effect on our earnings
per share,  except  during  periods  when the average  market  price of Ameren's
common  stock  is above  $46.61.  The  other  Ameren  Companies  do not have any
publicly held common stock and accordingly  earnings per share  calculations are
not relevant and are not presented.

Accounting Changes and Other Matters

SFAS No.143 - "Accounting for Asset Retirement Obligations"

     We adopted the provisions of SFAS 143,  effective January 1, 2003. SFAS 143
provides the accounting requirements for asset retirement obligations associated
with tangible,  long-lived assets.  SFAS 143 requires us to record the estimated
fair value of legal  obligations  associated  with the  retirement  of  tangible
long-lived  assets in the period in which the  liabilities  are  incurred and to
capitalize  a  corresponding  amount  as part of the book  value of the  related
long-lived  asset.  In  subsequent  periods,  we are  required  to adjust  asset
retirement  obligations based on changes in estimated fair value.  Corresponding
increases in asset book values are depreciated over the remaining useful life of
the related asset. Uncertainties as to the probability, timing or amount of cash
flows  associated with an asset  retirement  obligation  affect our estimates of
fair value.

                                       25
<PAGE>

     Upon adoption of this standard,  Ameren and UE recognized  additional asset
retirement  obligations of approximately  $213 million and a net increase in net
property  and plant of  approximately  $77  million  related  primarily  to UE's
Callaway nuclear plant decommissioning costs and retirement costs for a UE river
structure.  The difference between the net asset and the liability recorded upon
adoption  of SFAS 143  related  to  rate-regulated  assets  was  recorded  as an
additional  regulatory asset of approximately $136 million because Ameren and UE
expect to  continue to recover in  electric  rates the cost of Callaway  nuclear
decommissioning and other costs of removal.  These asset retirement  obligations
and associated  assets are in addition to assets and liabilities of $174 million
that UE had recorded  prior to the  adoption of SFAS 143,  related to the future
obligations and funds accumulated to decommission the Callaway nuclear plant.

     Also upon adoption of this standard,  Ameren and Genco  recognized an asset
retirement  obligation  of  approximately  $4 million and a net  increase in net
property and plant of approximately $34 million. The asset retirement obligation
relates to retirement  costs for a Genco power plant ash pond.  The net increase
in property and plant,  as well as the majority of the net after-tax gain of $18
million  recognized  upon  adoption,  resulted from the  elimination of costs of
removal for non  rate-regulated  assets  previously  accrued as a  component  of
accumulated depreciation that were not a legal obligation ($20 million).  Ameren
and Genco also  recognized a loss for the  difference  between the net asset and
liability  for the  retirement  obligation  recorded  upon  adoption  related to
Genco's assets ($2 million).

     As a result of the  acquisition  of CILCORP on January 31,  2003,  Ameren's
asset retirement obligations increased due to the assumption of asset retirement
obligations  of  approximately  $6 million  related to CILCO's  power  plant ash
ponds. Prior to the acquisition,  predecessor CILCORP and CILCO recognized a net
after-tax  gain  upon  adoption  of SFAS  143 of $4  million  and  $24  million,
respectively,  due to the elimination of costs of removal for non rate-regulated
assets previously  accrued as a component of accumulated  depreciation that were
not a legal  obligation.  Similar  to the  treatment  applied  by  Ameren in the
acquisition of CILCORP,  AES recorded purchase  accounting at the CILCORP parent
level  following its 1999  acquisition  of CILCORP,  but did not "push down" the
purchase  accounting  to  any  of  CILCORP's   subsidiaries,   including  CILCO.
Accordingly,  accumulated  depreciation,  including the embedded cost of removal
liabilities,  was reset to zero in purchase  accounting  for the CILCORP  parent
while CILCO  continued to carry  property and plant and the related  accumulated
depreciation on a historical basis. As a result,  the gain upon adoption of SFAS
143 recognized by CILCO  exceeded the gain  recognized by CILCORP since the cost
of removal  liabilities  reversed by CILCORP upon  adoption of SFAS 143 included
only those liabilities recorded since the 1999 AES acquisition.

     Asset  retirement  obligations  at Ameren  and UE  increased  by $5 million
during the quarter ended  September 30, 2003 and $16 million for the nine months
ended  September  30, 2003,  to reflect the  accretion of  obligations  to their
present  value.  Increases  to  Genco,  CILCORP  and  CILCO's  asset  retirement
obligations  were  immaterial  during these periods.  Substantially  all of this
accretion was recorded as an increase to regulatory assets.

     In addition  to those  obligations  that were  identified  and  valued,  we
determined that certain other asset retirement  obligations exist.  However,  we
were  unable  to  estimate  the  fair  value of those  obligations  because  the
probability,   timing  or  cash  flows  associated  with  the  obligations  were
indeterminable.  We do not believe that these obligations,  when incurred,  will
have a material adverse impact on our financial position,  results of operations
or liquidity.

     The fair value of the nuclear  decommissioning trust fund for UE's Callaway
nuclear  plant is reported in Nuclear  Decommissioning  Trust Fund in Ameren and
UE's Consolidated  Balance Sheets. This amount is legally restricted to fund the
costs of  nuclear  decommissioning.  Changes in the fair value of the trust fund
are  recorded as an increase or  decrease to the  regulatory  asset  recorded in
connection with the adoption of SFAS 143.

     SFAS 143 required a change in the depreciation  methodology we historically
utilized for our non  rate-regulated  operations.  Historically,  we included an
estimated cost of dismantling and removing plant from service upon retirement in
the basis upon which our depreciation  rates were determined.  SFAS 143 required
us to  exclude  costs  of  dismantling  and  removal  upon  retirement  from the
depreciation rates applied to non  rate-regulated  plant balances.  Further,  we
were required to remove accumulated provisions for dismantling and removal costs
from  accumulated  depreciation,  where they were embedded,  and to reflect such
adjustment  as a gain  upon  adoption  of  this  standard,  to the  extent  such
dismantling and removal  activities were not considered  legal asset  retirement
obligations  as defined by SFAS 143.  The  elimination  of costs of removal from
accumulated depreciation resulted in a gain for a change in accounting principle
at Ameren and Genco, as noted above, of $20 million, net of taxes. At CILCO, the
elimination of costs of removal from accumulated depreciation resulted in a gain
of $24 million,  net of taxes,  for a change in accounting  principle.  As noted
above,  the gain for


                                       26

<PAGE>


predecessor  CILCORP on a consolidated basis was only $4 million,  net of taxes,
due to the reset of accumulated  depreciation at the time of AES' acquisition of
CILCORP  in  1999.  Beginning  in  January  2003,  depreciation  rates  for  non
rate-regulated assets were reduced to reflect the discontinuation of the accrual
of dismantling and removal costs. In addition,  non rate-regulated asset removal
costs will  prospectively be expensed as incurred.  The impact of this change in
accounting will result in a decrease in depreciation  expense and an increase in
operations and maintenance  expense,  the net impact of which is indeterminable,
but not expected to be material.

     Like the methodology employed by our non rate-regulated operations, the
depreciation methodology historically utilized by our rate-regulated operations
has included an estimated cost of dismantling and removing plant from service
upon retirement. Because these estimated costs of removal have been included in
the cost of service upon which our present utility rates are based, and with the
expectation that this practice will continue in the jurisdictions in which we
operate, adoption of SFAS 143 did not result in any change in the depreciation
accounting practices of our rate-regulated operations. The following table
presents the estimated future removal costs embedded in accumulated depreciation
related to rate-regulated plant assets at September 30, 2003:


   =============================================================================
   Ameren(a).....................................................  $     685
   UE............................................................        549
   CIPS..........................................................        129
   Genco.........................................................          -
   CILCORP.......................................................          7
   CILCO.........................................................        150
   =============================================================================
     (a)  Excludes   amount  for  CILCO,   as  the  elimination  of  accumulated
          depreciation in purchase accounting was recorded at the CILCORP parent
          level.

     The following table presents the asset retirement obligation as though SFAS
143 had been in effect for 2001 and 2002:
<TABLE>
<CAPTION>

   =======================================================================================================
   Pro Forma Asset Retirement Obligation
   -------------------------------------------------------------------------------------------------------
                                        Ameren(a)       UE        CIPS     Genco     CILCORP(b)   CILCO
                                      --------------------------------------------------------------------
  <S>                                   <C>         <C>          <C>      <C>        <C>         <C>
   January 1, 2001..................     $  350      $   346      $ -      $  4       $    -      $   -
   December 31, 2001................        370          366        -         4            -          -
   December 31, 2002................        391          387        -         4            6          6
   =======================================================================================================
     (a)  Excludes  amounts for CILCORP and CILCO.
     (b)  Represents  predecessor information.

</TABLE>


     Pro forma net income,  as well as pro forma  earnings per share for Ameren,
has not been  presented  for the three and nine months ended  September 30, 2002
and for the years ended  December 31, 2002,  2001 and 2000 because the pro forma
application  of SFAS 143 to prior  periods  would result in pro forma net income
not materially different from the actual amounts reported for these periods.

EITF Issue No. 02-3 and EITF Issue No. 98-10

     In the quarters ended  September 30, 2002 and December 31, 2002, we adopted
the  provisions  of EITF 02-3,  "Issues  Involved in Accounting  for  Derivative
Contracts Held for Trading Purposes and Contracts Involved in Energy Trading and
Risk Management  Activities,"  that required  revenues and costs associated with
certain energy  contracts to be shown on a net basis in the Statement of Income.
Prior to adopting EITF 02-3 and the  rescission of EITF 98-10,  "Accounting  for
Contracts  Involved  in Energy  Trading  and Risk  Management  Activities,"  our
accounting practice was to present all settled energy purchase or sale contracts
within our power risk management  program on a gross basis in Operating Revenues
- Electric and Other and in Operating  Expenses - Fuel and  Purchased  Power and
Other Operations and Maintenance. This meant that revenues were recorded for the
sum of the notional  amounts of the power sales  contracts with a  corresponding
charge to income for the costs of the energy that was generated,  or for the sum
of the notional amounts of a purchased power contract.

     In October  2002,  the EITF reached a consensus to rescind EITF 98-10.  The
effective  date for the full  rescission  of EITF 98-10 was for  fiscal  periods
beginning after December 15, 2002, with early adoption  permitted.  In addition,
the EITF



                                       27

<PAGE>

reached a  consensus  in October  2002 that all SFAS No.  133,  "Accounting  for
Derivative Instruments and Hedging Activities," trading derivatives  (subsequent
to the rescission of EITF 98-10) should be shown net in the Statement of Income,
whether or not  physically  settled.  This  consensus  applies to all energy and
non-energy related trading  derivatives that meet the definition of a derivative
pursuant to SFAS 133. The following  table  presents the operating  revenues and
costs that were netted for the three and nine months ended  September  30, 2002,
which reduced Operating  Revenues - Electric and Other, and Operating Expenses -
Fuel and Purchased Power and Other Operations and Maintenance by equal amounts:

   =============================================================================
                                                 Three Months       Nine Months
   -----------------------------------------------------------------------------
   Ameren(a)...................................  $   189            $    563
   UE..........................................      117                 345
   CIPS........................................        -                   -
   Genco.......................................       61                 191
   CILCORP(b)..................................        -                   -
   CILCO.......................................        -                   -
   =============================================================================
     (a)  Excludes  amounts for CILCORP and CILCO prior to the acquisition  date
          of January 31, 2003 and  includes  amounts for  non-registrant  Ameren
          subsidiaries as well as intercompany eliminations.
     (b)  Represents predecessor information.

     The  adoption of EITF 02-3,  the  rescission  of EITF 98-10 and the related
transition  guidance  resulted in the netting of energy  contracts for financial
reporting purposes, which lowered our reported revenues and costs with no impact
on earnings.

SFAS No.  148 -  "Accounting  for  Stock-Based  Compensation  -  Transition  and
Disclosure"

     In December  2002, the FASB issued SFAS 148. SFAS 148 amended SFAS No. 123,
"Accounting for Stock-Based  Compensation,"  to provide  alternative  methods of
transition for an entity that voluntarily changes to the fair value-based method
of  accounting  for  stock-based  employee  compensation.  It also  amended  the
disclosure  provisions to require  disclosure  about the effects on reported net
income of an entity's  accounting  policy  decisions with respect to stock-based
employee compensation.

     Prior to 2003, Ameren and CILCORP accounted for stock options granted under
long-term  incentive plans under the  recognition and measurement  provisions of
APB Opinion 25,  "Accounting  for Stock  Issued to  Employees."  No  stock-based
employee  compensation cost was reflected for options under either plan in 2002,
2001,  and 2000 as all options  granted  under the plans had an  exercise  price
equal to the market value of the  underlying  common stock on the date of grant.
The pretax cost of weighted-average  grant-date fair value of options for Ameren
would have been approximately $2 million in 2002, 2001, and 2000 and $4 million,
$2 million and $1 million,  respectively,  for predecessor CILCORP, had the fair
value method under SFAS 123 been used for options granted.  Effective January 1,
2003, we adopted the fair value recognition  provisions of SFAS 123 by using the
prospective  method of  adoption  under SFAS 148.  Stock  options  have not been
granted since 2000 at Ameren and since 2001 at CILCORP, and therefore,  SFAS 148
did not have any effect on Ameren's or CILCORP's financial position,  results of
operations or liquidity since adoption.

SFAS No. 149 - "Amendment of Statement 133 on Derivative Instruments and Hedging
Activities"

     In April 2003,  the FASB issued SFAS 149.  SFAS 149 further  clarifies  and
amends accounting and reporting for derivative instruments. The statement amends
SFAS 133,  "Accounting for Derivative  Instruments and Hedging  Activities," for
decisions made by the Derivative  Implementation Group, as well as issues raised
in connection with other FASB projects and implementation  issues. The statement
is effective for contracts  entered into or modified  after June 30, 2003 except
for  implementation  issues  that  have been  effective  for  reporting  periods
beginning  before June 15,  2003,  which  continue to be applied  based on their
original  effective  dates.  SFAS 149 did not have any  material  impact  on our
financial  position,  results of  operations  or liquidity  upon adoption in the
third quarter of 2003.


                                       28

<PAGE>

SFAS  No.  150  -   "Accounting   for   Certain   Financial   Instruments   with
Characteristics of Both Liabilities and Equity"

     In May 2003, the FASB issued SFAS 150 that established standards for how an
issuer   classifies   and   measures   certain   financial    instruments   with
characteristics  of both  liabilities  and equity.  SFAS 150 requires  financial
instruments  that  were  issued  in the  form of  shares  with an  unconditional
obligation to redeem the instrument by transferring  assets on a specified date,
to be  classified  as  liabilities.  Accordingly,  SFAS 150 requires  issuers to
classify mandatorily  redeemable financial instruments as liabilities.  SFAS 150
also  requires  such  financial  instruments  to be measured at fair value and a
cumulative effect adjustment to be recognized in the statement of income for any
difference between the carrying amount and fair value. SFAS 150 became effective
July 1, 2003. At July 1, 2003,  CILCO had $21 million of preferred stock subject
to mandatory  redemption,  which was  reclassified  in the current period to the
liability  section of  Ameren's,  CILCORP's  and  CILCO's  Consolidated  Balance
Sheets. In accordance with the requirements of SFAS 150, no reclassification was
made to the  presentation  on the December  31, 2002  Balance  Sheets of Ameren,
CILCORP and CILCO.  This  preferred  stock is redeemable at par at any time, and
therefore,  it was estimated there was no difference between book value and fair
value.

FIN No. 46 - "Consolidation of Variable Interest Entities,  an Interpretation of
ARB 51, Consolidated Financial Statements"

     In  January  2003,  the FASB  issued  FIN 46 to  address  consolidation  of
variable-interest  entities  (VIEs).  The  primary  objective  of  FIN 46 was to
provide guidance on the identification of, and financial reporting for, entities
over which  control is achieved  through means other than voting  rights.  If an
entity absorbs the majority of the VIEs' expected  losses or receives a majority
of the VIEs' expected residual returns, or both, it must consolidate the VIE. An
entity  that  is  required  to  consolidate   the  VIE  is  called  the  primary
beneficiary.  Additional  disclosure  requirements  are also  applicable when an
entity holds a  significant  variable  interest in a VIE, but is not the primary
beneficiary.

     Initially,  FIN 46 was  effective no later than the  beginning of the first
interim period after June 15, 2003 for VIEs created before February 1, 2003. For
VIEs  created  after  January 31, 2003,  FIN 46 was  effective  immediately.  In
September  2003, the FASB  tentatively  concluded to defer the effective date of
FIN 46 until the end of the first interim or annual period ending after December
15, 2003 for an  interest  held by a public  company in a VIE or a possible  VIE
that meets certain conditions.

     We are in the process of  reviewing  the  entities  that have a  reasonable
possibility  of being  classified  as VIEs.  At this time,  we do not expect the
impact of FIN 46 on our financial position,  results of operations, or liquidity
to be material upon adoption.

Interchange Revenues

     The following table presents the interchange revenues included in Operating
Revenues - Electric  for the three months and nine months  ended  September  30,
2003 and 2002:

<TABLE>
<CAPTION>
  ================================================================================================
                                                   Three Months                  Nine Months
  ------------------------------------------------------------------------------------------------
                                                  2003          2002           2003         2002
                                                  ----          ----           ----         ----
  <S>                                           <C>           <C>            <C>          <C>
   Ameren(a).................................    $ 79          $ 55           $ 264        $ 203
   UE........................................      72            59             239          199
   CIPS......................................      10            10              28           28
   Genco.....................................      34            27             107           77
   CILCORP(b)................................       7             3              15            7
   CILCO.....................................       7             3              15            7
   ===============================================================================================
     (a)  Excludes  amounts for CILCORP and CILCO prior to the acquisition  date
          of January 31, 2003 and  includes  amounts for  non-registrant  Ameren
          subsidiaries as well as intercompany eliminations.
     (b)  2002 amounts represent predecessor  information.  2003 amounts include
          January 2003  predecessor  information  which was $3 million.  CILCORP
          consolidates  CILCO  and  therefore  includes  CILCO  amounts  in  its
          balances.

</TABLE>

                                       29

<PAGE>

Purchased Power

     The following  table  presents the  purchased  power  expenses  included in
Operating  Expenses  - Fuel and  Purchased  Power for the three  months and nine
months  ended  September  30,  2003  and  2002.  See  Note  7  -  Related  Party
Transactions for further information on affiliate transactions.
<TABLE>
<CAPTION>

 ===============================================================================================================
                                                                    Three Months                  Nine Months
 ---------------------------------------------------------------------------------------------------------------
                                                                 2003            2002          2003       2002
                                                                 ----            ----          ----       ----
  <S>                                                          <C>             <C>          <C>          <C>
   Ameren(a)..............................................      $  97           $  48        $  220       $ 152
   UE.....................................................         44              58           127         177
   CIPS...................................................         96             117           264         323
   Genco..................................................         34              23           106          75
   CILCORP(b).............................................         57              41           142         105
   CILCO..................................................         57              41           139         105
   =============================================================================================================
     (a)  Excludes  amounts for CILCORP and CILCO prior to the acquisition  date
          of January 31, 2003 and  includes  amounts for  non-registrant  Ameren
          subsidiaries as well as intercompany eliminations.
     (b)  2002 amounts represent predecessor  information.  2003 amounts include
          January 2003 predecessor  information  which was $12 million.  CILCORP
          consolidates  CILCO  and  therefore  includes  CILCO  amounts  in  its
          balances.

</TABLE>

Excise Taxes

     Excise taxes on Missouri  electric and gas, and Illinois gas customer bills
are imposed on UE, CIPS and CILCO and are recorded  gross in Operating  Revenues
and Taxes Other than Income Taxes.  Excise taxes applicable to Illinois electric
customer  bills are imposed on the consumer and are recorded as tax  collections
payable and included in Taxes Accrued on the  Consolidated  Balance  Sheet.  The
following  table  presents the excise taxes  recorded in Operating  Revenues and
Taxes Other than Income Taxes for the three and nine months ended  September 30,
2003 and 2002:

<TABLE>
<CAPTION>
================================================================================================================
                                                                   Three Months                  Nine Months
----------------------------------------------------------------------------------------------------------------
                                                                 2003            2002           2003        2002
                                                                 ----            ----           ----        ----
  <S>                                                          <C>            <C>           <C>          <C>
   Ameren(a)..............................................      $  40           $  38        $  102       $  94
   UE.....................................................         33              36            80          85
   CIPS...................................................          2               2            10           9
   Genco..................................................          -               -             -           -
   CILCORP(b).............................................          5               3            14          12
   CILCO..................................................          5               3            14          12
   =============================================================================================================
     (a)  Excludes  amounts for CILCORP and CILCO prior to the acquisition  date
          of January 31, 2003.
     (b)  2002 amounts represent predecessor  information.  2003 amounts include
          January 2003  predecessor  information  which was $2 million.  CILCORP
          consolidates  CILCO  and  therefore  includes  CILCO  amounts  in  its
          balances.

</TABLE>

Goodwill

     Goodwill is the excess of the  purchase  price of an  acquisition  over the
fair value of the net assets  acquired.  Under the  provisions  of SFAS No. 142,
"Goodwill  and  Other  Intangible  Assets,"  we are  not  required  to  amortize
goodwill.  SFAS 142 requires the  evaluation of goodwill for impairment at least
annually or more frequently if events and circumstances  indicate that the asset
might be  impaired.  Our  goodwill  primarily  relates to the  January  31, 2003
acquisition  of CILCORP.  See Note 2 - Acquisitions  for additional  information
regarding the acquisition.

                                       30
<PAGE>


Pension

     A minimum  pension  liability  was  recorded  at  December  31,  2002 which
resulted in a charge to Accumulated OCI and a reduction in stockholders' equity.
The minimum  pension  liability  has not changed as of September  30, 2003.  The
following table presents the minimum pension liability amounts,  after taxes, as
of September 30, 2003:

   =============================================================================
                                                             September 30, 2003
   -----------------------------------------------------------------------------
   Ameren(a)...................................................    $  102
   UE..........................................................        62
   CIPS........................................................        13
   Genco.......................................................         6
   CILCORP(b)..................................................        61
   CILCO.......................................................        30
   =============================================================================
     (a)  Excludes  amounts for CILCORP and CILCO,  which were recorded prior to
          the acquisition date of January 31, 2003.
     (b)  Represents predecessor information.

     Based on  changes  in  interest  rates,  we may be  required  to change our
actuarial assumptions for our pension plan valuation at December 31, 2003, which
could result in recognition of an additional minimum pension liability.

Coal Contract Settlement

     Ameren and UE recorded a coal  contract  settlement  gain of $51 million in
the third  quarter of 2003.  This gain  primarily  represented  a return of coal
costs plus accrued interest  accumulated by a coal supplier for reclamation of a
coal mine that principally  supplied UE's power plant.  This mine reclamation is
now  substantially  complete.  In August  2003,  UE  entered  into a  settlement
agreement with the coal supplier to return the  accumulated  reclamation  funds,
which will be paid to UE ratably through December 2004.


NOTE 2 - Acquisitions

     On  January  31,  2003,  Ameren  completed  the  acquisition  of all of the
outstanding  common stock of CILCORP from AES.  CILCORP is the parent company of
Peoria,  Illinois-based  CILCO.  With the acquisition,  CILCO became an indirect
Ameren  subsidiary,  but  remains  a  separate  utility  company,  operating  as
AmerenCILCO.  On February 4, 2003,  Ameren also  completed  the  acquisition  of
Medina  Valley,  which  indirectly  owns  a  40  megawatt,   gas-fired  electric
generation  plant.  The results of operations for CILCORP and Medina Valley were
included  in  Ameren's  consolidated  financial  statements  effective  with the
respective  January and February 2003 acquisition dates. See Note 1 - Summary of
Significant  Accounting  Policies for further information on the presentation of
the results of CILCORP and CILCO in Ameren's consolidated financial statements.

     Ameren  acquired  CILCORP  to  complement  its  existing  Illinois  gas and
electric operations.  The purchase included CILCO's rate-regulated  electric and
natural gas  businesses in Illinois  serving  approximately  200,000 and 205,000
customers, respectively, of which approximately 150,000 are combination electric
and gas  customers.  CILCO's  service  territory  is  contiguous  to our service
territory.  CILCO  also  has a non  rate-regulated  electric  and gas  marketing
business  principally  focused in the Chicago,  Illinois  region.  Finally,  the
purchase included approximately 1,200 megawatts of largely coal-fired generating
capacity,  most of which  became  non  rate-regulated  on October 3, 2003 due to
CILCO's transfer of 1,100 megawatts of generating capacity to AERG. See Note 1 -
Summary of  Significant  Accounting  Policies  for  further  information  on the
transfer to AERG.

     The total acquisition cost was approximately  $1.4 billion and included the
assumption by Ameren of CILCORP and Medina  Valley debt and  preferred  stock at
closing of $895 million and  consideration  of $489 million in cash, net of cash
acquired.  The cash component of the purchase price came from Ameren's  issuance
in September  2002 of 8.05 million  common shares and its issuance in early 2003
of an additional 6.325 million common shares, which together generated aggregate
net proceeds of $575 million.

     The following unaudited pro forma financial  information presents a summary
of Ameren's  consolidated  results of operations  assuming the  acquisitions  of
CILCORP and Medina  Valley had been  completed  at the  beginning of fiscal year

                                       31

<PAGE>


2002,  including  pro  forma  adjustments,  which  are  based  upon  preliminary
estimates,  to reflect the  allocation of the purchase price to the acquired net
assets.  Ameren and  CILCORP  are in the  process of  completing  a third  party
valuation of acquired property and plant and intangible assets.  Therefore,  the
allocation  of the  purchase  price is  subject  to  change.  The  excess of the
purchase   price  over   tangible  net  assets   acquired  has  been   allocated
preliminarily to goodwill in the amount of $615 million.

<TABLE>
<CAPTION>
   ================================================================================================================
   For the periods ended September 30,                                    Three Months             Nine Months
   ----------------------------------------------------------------------------------------------------------------
                                                                       2003(a)     2002        2003       2002
                                                                       ----        ----        ----       ----
  <S>                                                                <C>        <C>          <C>        <C>
   Operating revenues...............................................  $ 1,350   $ 1,363      $ 3,647     $ 3,583
   Income before cumulative effect of change in accounting                275       263          472         443
     principle......................................................
   Cumulative effect of change in accounting principle, net of taxes        -         -           22           -
   Net income.......................................................  $   275   $   263      $   494     $   443

   Earnings per share - basic.......................................  $  1.70   $  1.64      $  3.07     $  2.82
                      - diluted.....................................     1.70      1.64         3.06        2.81

   ==============================================================================================================
     (a)  Represents actual Ameren results of operations.
</TABLE>

     This pro forma information is not necessarily  indicative of the results of
operations  as they would have been had the  transactions  been  effected on the
assumed date, nor is it an indication of trends in future results.


NOTE 3 - Rate and Regulatory Matters

Intercompany  Transfer of Electric  Generating  Facilities and Illinois  Service
Territory

     As a part of the settlement of the Missouri  electric rate case in 2002, UE
committed  to making  certain  infrastructure  investments  from January 1, 2002
through June 30, 2006,  including  the addition of 700  megawatts of  generation
capacity. The new capacity requirement is expected to be satisfied,  in part, by
the proposed  transfer from Genco to UE, at net book value  (approximately  $250
million),  of approximately 550 megawatts of combustion turbine generating units
at Pinckneyville and Kinmundy,  Illinois.  The transfer is subject to receipt of
FERC and SEC  approval.  Approval by the MoPSC is not required in order for this
transfer to occur.  However,  the MoPSC has  jurisdiction  over UE's  ability to
recover the cost of the  transferred  generating  facilities  from its  electric
customers in its rates. As part of the settlement of the Missouri  electric rate
case in 2002, UE is subject to a rate moratorium providing for no changes in its
electric  rates before June 30,  2006,  subject to certain  statutory  and other
exceptions.  Approval of the ICC is not required  contingent upon prior approval
and execution of UE's transfer of its Illinois public utility operations to CIPS
as discussed below.

     In February  2003,  UE sought  approval  from the FERC to transfer  the 550
megawatts  of  generating  assets from Genco to UE.  Certain  independent  power
producers  objected to UE's request  based on a claim that the transfer may harm
competition  for the sale of  electricity  at wholesale.  In May 2003,  the FERC
issued an order  which set for hearing  the effect of the  proposed  transfer on
competition in wholesale electric markets, which UE appealed.  Subsequently, the
FERC Staff filed testimony which supported the proposed transfer and recommended
that the FERC accept it. A hearing was held in October 2003 and an initial order
by the Administrative Law Judge is expected to be issued in the first quarter of
2004.  After the parties to the  proceeding  have an  opportunity  to review and
comment on the  initial  order,  the matter  will be  submitted  to the FERC for
issuance of a final order.

     In May 2003, UE announced its plan to limit its public  utility  operations
to the  state of  Missouri  and to  discontinue  operating  as a public  utility
subject to ICC  regulation.  UE intends to accomplish  this plan by transferring
its   Illinois-based   electric  and  natural  gas  businesses,   including  its
Illinois-based  distribution  assets and certain of its transmission  assets, to
CIPS.  In 2002,  UE's  Illinois  electric  and gas service  territory  generated
revenues  of $166  million  and is  expected  to have a net  book  value of $138
million at December 31, 2003. UE's electric generating facilities and certain of
its  electric  transmission  facilities  in  Illinois  would  not be part of the
transfer.  The transfer of UE's  Illinois-based  utility businesses will require
the approval of the ICC, the FERC, the MoPSC and the SEC under the provisions of
the PUHCA. In August 2003, UE filed with the MoPSC,  and in October and November
2003 filed with the ICC,  the FERC and the SEC for  authority  to


                                       32

<PAGE>


transfer UE's Illinois-based utility businesses, at net book value, to CIPS. The
filing with the ICC seeks approval to transfer only UE's Illinois-based  natural
gas  utility   business   since  the  ICC   authorized   the  transfer  of  UE's
Illinois-based  electric  utility  business  to CIPS in  2000.  UE  proposes  to
transfer  approximately one-half of the assets directly to CIPS in consideration
for a CIPS promissory note, and approximately one-half of the assets by means of
a dividend  in kind to Ameren  followed by a capital  contribution  by Ameren to
CIPS.

     A filing  seeking  approval  of both the  transfer  of UE's  Illinois-based
utility business and Genco's  combustion  turbine generating units was made with
the SEC in October 2003. If  completed,  the transfers  will be accounted for at
book value with no gain or loss recognition  which is appropriate  treatment for
transactions of this type by two entities under common control.

     We  are  unable  to  predict  the  ultimate  outcome  of  these  regulatory
proceedings or the timing of the final decisions of the various agencies.

Regional Transmission Organization

     In April 2003, the FERC authorized the request of the GridAmerica Companies
to transfer  functional control of their transmission assets to GridAmerica LLC.
The FERC also  accepted the  amendments  to the Midwest ISO OATT,  suspended the
proposed rates for a nominal period,  subject to refund, and established hearing
and settlement  procedures to determine the justness and  reasonableness  of the
proposed  rate  amendments to the Midwest ISO OATT. At this time the parties are
pursuing settlement of the disputed rate issues, which, absent settlement,  will
go into effect subject to refund effective upon the commencement of service over
the GridAmerica Companies transmission facilities under the Midwest ISO OATT. In
May 2003,  the FERC  accepted the revised  agreements  filed by the  GridAmerica
Companies to reflect the changes requested by the FERC.

     In August 2003, the GridAmerica  Companies filed  acknowledgements with the
FERC that permitted  GridAmerica LLC to commence  operations on October 1, 2003,
on a phased basis, by assuming,  with the Midwest ISO, functional control of the
American  Transmission  Systems,   Incorporated,  a  subsidiary  of  FirstEnergy
Corporation  and Northern  Indiana  Public  Service  Company,  a  subsidiary  of
NiSource,  Inc.  transmission  systems. UE and CIPS transmission systems are not
currently  included in GridAmerica  LLC's  operations due to UE's need for MoPSC
approval, which is pending.

     In  September  2003,  in  response  to  a  FERC  order  requesting  various
transmission  asset  owners  that  are  not yet  participating  in a RTO to file
testimony  describing the  impediments to their  participation  in a RTO, Exelon
Corporation  announced  it was in  exclusive  negotiations  with  Dynegy Inc. to
purchase  Illinois Power Company,  and if successful in the acquisition,  Exelon
Corporation  would seek to transfer  functional  control of the  Illinois  Power
Company  transmission  assets to the PJM Interconnection LLC RTO. In response to
this  announcement,  UE and CIPS  announced  to the FERC that the  change in RTO
participation  by  Illinois  Power  Company  from  the  Midwest  ISO to the  PJM
Interconnection  LLC RTO would cause UE and CIPS to reassess their commitment to
participate in the Midwest ISO through GridAmerica LLC.

     If UE secures  approval to participate  in GridAmerica  LLC from the MoPSC,
and UE and CIPS transfer  functional  control of their  transmission  systems to
GridAmerica  LLC,  the FERC has ordered the return,  with  interest,  of the $13
million  exit fee paid by UE and the $5 million  exit fee paid by CIPS when they
previously left the Midwest ISO.

     CILCO  is  already  a  transmission  member  of the  Midwest  ISO  and  has
transferred  functional  control of its transmission  system to the Midwest ISO.
Transmission  service on the CILCO  transmission  system is provided pursuant to
the terms and conditions of the Midwest ISO OATT on file with the FERC.

     Genco does not own transmission assets, but pays UE and CIPS for the use of
their  transmission  systems to transmit power from the Genco generating plants.
Until the tariffs and other  material terms of CIPS' and UE's  participation  in
the GridAmerica Companies,  and the GridAmerica Companies'  participation in the
Midwest  ISO,  are  finalized  and  approved  by the FERC and  other  regulatory
authorities,  the ultimate  impact that on-going RTO  developments  will have on
UE's, CIPS' and Genco's financial  position,  results of operations or liquidity
is unpredictable.

     On November 13, 2003,  the FERC said that it will issue an order  upholding
an earlier  order  issued in July 2003 (July  Order)  that will  reduce UE's and
CIPS',  as well as other  utilities,  "throught and out"  transmission  revenues
effective April

                                       33
<PAGE>

1, 2004.  We are in the process of obtaining  and  reviewing  the final  written
order.  The revenues  subject to  elimination by these orders are those revenues
from  transmission  that  travel  through or out of UE's and CIPS'  transmission
system and are also used to provide  electricity  to load within the Midwest ISO
or PJM Interconnection  LLC systems.  The magnitude of the potential net revenue
reduction resulting from these orders could be up to $20 to $25 million annually
if UE and CIPS are not in a RTO. UE and CIPS would incur  approximately  60% and
40%,  respectively,  of  the  potential  net  revenue  reduction.  While  it  is
anticipated that UE's and CIPS' transmission  revenues could be reduced by these
orders,  transmission  expenses for Genco could be reduced.  Morever, we believe
the FERC's final Order will explicitly  permit companies  participating in a RTO
to collect the lost  "through and out" revenues  through other rate  mechanisms.
Until it is determined when, or if, UE and CIPS will join a RTO, UE and CIPS are
unable to predict the ultimate impact of these orders.

Standard Market Design Notice of Proposed Rulemaking

     In July 2002,  the FERC  issued a Standard  Market  Design  NOPR.  The NOPR
proposes  a number of  changes  to the way the  current  wholesale  transmission
service and energy  markets are operated.  Specifically,  the NOPR calls for all
jurisdictional  transmission  facilities  to be placed  under the  control of an
independent   transmission   provider  (similar  to  a  RTO),   proposes  a  new
transmission  service tariff that provides a single form of transmission service
for all users of the  transmission  system  including  bundled  retail load, and
proposes  a new  energy  market  and  congestion  management  system  that  uses
locational marginal pricing as its basis.

     Although issuance of the Standard Market Design final rule is uncertain and
the  implementation  schedule  is  unknown,  the  Midwest  ISO is already in the
process of  implementing a separate market design similar to the proposed market
design in the NOPR. In July 2003,  the Midwest ISO filed with the FERC a revised
OATT codifying the terms and conditions  under which it would  implement the new
market design.  The Midwest ISO targeted March 2004 as the start date for staged
implementation.  In October 2003, the Midwest ISO filed a pleading with the FERC
to withdraw its revised OATT to ensure that effective  reliability  tools are in
place and operating  correctly before moving forward with the new market design.
UE and CIPS will  continue  monitoring  the status of the Midwest  ISO's  market
design and the potential impact of the market design on the cost and reliability
of  service to retail  customers.  At this  time,  we are unable to predict  the
ultimate  impact  the new  market  design  will have on their  future  financial
position, results of operations or liquidity.

Illinois Electric

     In  2002,  all of  the  Illinois  residential,  commercial  and  industrial
customers  of UE,  CIPS and CILCO had a choice in electric  suppliers  under the
provisions  of 1997 Illinois  legislation  related to the  restructuring  of the
Illinois  electric industry (the Illinois Law). Under the Illinois Law, UE, CIPS
and CILCO  rates  initially  were  frozen  through  January 1, 2005,  subject to
residential  electric  rate  decreases  of up to 5% in 2002 to the extent  rates
exceeded the Midwest utility  average.  In 2002, the Illinois  electric rates of
UE, CIPS and CILCO were below the Midwest utility average.

     As the result of an  amendment  to the  Illinois  Law,  the rate freeze was
extended through January 1, 2007. As a result of this extension  through January
1, 2007,  CIPS and  Marketing  Company  expect to seek to renew or extend  their
power  supply  agreement  and CILCO  and AERG  expect to seek to renew or extend
their power supply agreement  through January 1, 2007. A renewal or extension of
the power supply agreements depend on compliance with regulatory requirements in
effect at the time.

     The  Illinois  Law  allows a utility  to collect  transition  charges  from
customers that elect to move from bundled retail rates to market-based power and
energy.  Utilities  have the  right to  collect  applicable  transition  charges
throughout the  transition  period that ends January 1, 2007 from customers that
elect market-based power and energy. In the order authorizing the acquisition of
CILCO by Ameren,  the ICC required  UE, CIPS and CILCO to  eliminate  transition
charges  in the period  commencing  June  2003,  through at least May 2005.  The
non-recovery of transition  charges is not expected to have a material impact on
UE, CIPS or CILCO.

     The  Illinois  Law also  contains a provision  requiring  that  one-half of
excess earnings from the Illinois  jurisdiction  for the years 1998 through 2006
be refunded to UE, CIPS and CILCO's  Illinois  customers.  Excess  earnings  are
defined as the portion of the two-year  average  annual rate of return on common
equity in excess of 1.5% of the two-year average of the Index, as defined in the
Illinois  Law.  The Index is  defined as the sum of the  average  for the twelve
months ended

                                       34

<PAGE>

September 30 of the average monthly yields of the Treasury long-term average (25
years and above),  plus 7% for both UE and CIPS and 11% for CILCO.  CILCO,  CIPS
and UE's average  rates of return on common  equity for the two-year  average at
December 31, 2002 were 9%, 6% and 13%, respectively,  as compared to the average
Index of 18% for  CILCO  and 14% for  CIPS and UE.  No  refunds  to UE,  CIPS or
CILCO's Illinois customers are expected to be required for the period from April
1, 2002 through  March 31,  2003.  During the twelve  months ended  December 31,
1999,  UE made excess  earnings  refunds of $2.1 million  resulting  from excess
earnings  during the period  April 1, 2000 through  March 31,  2001.  During the
twelve months ended December 31, 2000, UE made excess  earnings  refunds of $1.5
million from April 1, 2001 through  March 31, 2002.  These refunds were recorded
as a reduction to Operating Revenues - Electric.

Illinois Gas

     In October  2003,  the ICC issued an order  awarding  CILCO an  increase in
annual gas rates of $9 million and awarding  CIPS and UE increases in annual gas
rates of $7 million and $2 million, respectively. These new rates were effective
in November 2003.

Missouri Gas

     In May 2003, UE filed a request with the MoPSC to increase annual rates for
natural gas service by  approximately  $27 million.  UE proposed to phase in the
rate  increases  over two years,  with one half of the  increase  taking  effect
December 1, 2003 and the other half  taking  effect  November  1, 2004.  UE also
proposed not to seek additional increases in gas rates through November 1, 2006,
subject to certain  exceptions.  The proposal  also called for UE to  contribute
$1.75 million to an energy assistance program to help low-income  customers.  In
October 2003, the MoPSC Staff and other parties to this proceeding  filed direct
testimony.  The MoPSC Staff in its testimony  recommended  an increase in annual
rates of approximately $11 million. In late October and early November 2003, the
parties  participated  in a  prehearing  settlement  conference  and  settlement
discussions  are  continuing.  A hearing in this  proceeding  is  scheduled  for
January  2004 in the event a  settlemnet  is not reached and the MoPSC has until
April 2004 to render a decision in this case.


NOTE 4 - Debt and Equity Financings

Ameren

     In August 2002, the SEC declared effective a shelf  registration  statement
filed by Ameren  covering the offering from time to time of up to $1.473 billion
of various forms of securities  including long-term debt and trust preferred and
equity  securities.  In  2002,  Ameren  issued  approximately  $338  million  of
securities pursuant to the shelf registration statement.

     In the  first  quarter  of  2003,  Ameren  issued,  pursuant  to the  shelf
registration  statement,  6.325 million shares of its common stock at $40.50 per
share.  Ameren  received net proceeds,  after fees, of $248 million,  which were
used  to  fund  the  remaining  cash  portion  of the  purchase  price  for  its
acquisition of CILCORP.  See Note 2 - Acquisitions for further  information.  At
September 30, 2003,  the amount of securities  remaining  available for issuance
pursuant to the shelf registration  statement was $879 million.  Ameren may sell
all,  or a portion  of,  the  remaining  securities  registered  under the shelf
registration   statement  if  warranted   by  market   conditions   and  capital
requirements.  Any offer  and sale  will be made  only by means of a  prospectus
meeting  the  requirements  of the  Securities  Act of 1933  and the  rules  and
regulations thereunder.

     The  acquisitions  of  CILCORP  on January  31,  2003 and Medina  Valley on
February 4, 2003 included the  assumption by Ameren of CILCORP and Medina Valley
debt and preferred stock at closing of $895 million.  The assumed debt primarily
consisted of $250 million 9.375% senior notes due 2029, $225 million 8.7% senior
notes due 2009, a $100 million secured  floating rate term loan due 2004,  other
secured  indebtedness  totaling $279 million and preferred stock of $41 million.

     In July 2003,  Ameren  entered  into two new  revolving  credit  facilities
aggregating  $470 million to be used for general  corporate  purposes  including
support of our  commercial  paper  programs.  The $470 million in new facilities
includes a $235 million  364-day  revolving  credit  facility and a $235 million
three-year revolving credit facility. These new credit


                                      35

<PAGE>


facilities  replaced  Ameren's  existing $270 million 364-day  revolving  credit
facility,  which matured in July 2003, and a $200 million facility,  which would
have matured in December  2003.  The new credit  facilities  contain  provisions
which  require us to meet minimum  ERISA  funding  requirements  for our pension
plan. The prior credit facilities  included more restrictive  provisions related
to the  funded  status of our  pension  plan,  which are not  present in the new
facilities.  Ameren also has a $130 million  multi-year  credit  facility  which
includes the ERISA-related  provisions that have been modified to conform to the
provisions in the two new revolving credit  facilities.  As a result, for any of
our credit facilities that contain provisions related to pension funding, we are
now only required to meet all of the minimum ERISA funding  rules.  At September
30, 2003, all of such borrowing capacity under these facilities was available.

     The following  table presents the  amortization  of debt issuance costs and
any premium or discounts included in interest expense in the Statement of Income
for the three and nine months ended September 30, 2003 and 2002:
<TABLE>
<CAPTION>

   =================================================================================================================
                                                                    Three Months                 Nine Months
   -----------------------------------------------------------------------------------------------------------------
                                                                 2003          2002          2003           2002
                                                                 ----          ----          ----           ----
  <S>                                                          <C>            <C>           <C>          <C>
   Ameren(a)...............................................     $  3           $  2          $  8         $   6
   UE......................................................        1              1             3             3
   CIPS....................................................        1              -             1             1
   Genco...................................................        -              -             1             1
   CILCORP(b) .............................................        1              -             1             -
   CILCO...................................................        -              -             -             -
   ================================================================================================================
     (a)  Excludes  amounts for CILCORP and CILCO prior to the acquisition  date
          of January 31, 2003 and  includes  amounts for  non-registrant  Ameren
          subsidiaries as well as intercompany eliminations.
     (b)  2002 amounts represent predecessor  information.  2003 amounts include
          January  2003  predecessor   information  which  were  zero.   CILCORP
          consolidates  CILCO  and  therefore  includes  CILCO  amounts  in  its
          balances.

</TABLE>

     At September 30, 2003, neither Ameren, nor any of its subsidiaries, had any
off-balance  sheet financing  arrangements,  other than operating leases entered
into in the ordinary course of business.

     At September 30, 2003,  the Ameren  Companies  were in compliance  with all
material financial agreement provisions and covenants.

UE

     In August 2002, the SEC declared effective a shelf  registration  statement
filed by UE covering  the  offering  from time to time of up to $750  million of
various forms of long-term debt and trust preferred securities.

     In March 2003,  UE issued,  pursuant to the August 2002 shelf  registration
statement,  $184 million of 5.50% Senior  Secured  Notes due March 15, 2034.  UE
received  net  proceeds,  after fees,  of $180  million,  which along with other
funds,  were  used in April  2003 to redeem  $104  million  principal  amount of
outstanding  8.25% first  mortgage  bonds due October 15, 2022,  at a redemption
price of 103.61% of par, plus accrued  interest,  and to repay  short-term  debt
incurred to pay at maturity $75 million principal amount of 8.33% first mortgage
bonds that matured in December 2002.

     In April 2003,  UE issued,  pursuant to the August 2002 shelf  registration
statement,  $114 million of 4.75%  Senior  Secured  Notes due April 1, 2015.  UE
received net proceeds, after fees, of $113 million, which along with other funds
were used in May 2003 to redeem  $85  million  principal  amount of  outstanding
8.00% first  mortgage  bonds due  December 15,  2022,  at a redemption  price of
103.38% of par, plus accrued interest, and to reduce short-term debt.

     In July 2003,  UE issued,  pursuant to the August  2002 shelf  registration
statement,  $200 million of 5.10% Senior  Secured  Notes due August 1, 2018.  UE
received net proceeds, after fees, of $198 million, which along with other funds
were used to repay short-term debt incurred to fund the maturity of $100 million
principal  amount 7.65% first  mortgage bonds due July 15, 2003 and to repay $21
million of other  short-term  debt.  The remaining  proceeds were used in August
2003 to redeem $75 million  principal amount of outstanding 7.15% first mortgage
bonds due August 1, 2023 at a redemption  price of 103.01% of par,  plus accrued
interest.

                                       36
<PAGE>



     In September 2003, the SEC declared  effective  another shelf  registration
statement filed by UE in August 2003, covering the offering from time to time of
up to $1  billion  of  various  forms  of  long-term  debt and  trust  preferred
securities.  The $79 million of securities which remained available for issuance
under the  August  2002  shelf  registration  is  included  in the $1 billion of
securities available to be issued under this shelf registration statement.

     In  October  2003,  UE  issued,   pursuant  to  the  September  2003  shelf
registration  statement,  $200 million of 4.65% Senior Secured Notes due October
1, 2013. UE received net proceeds,  after fees, of $198 million, which were used
to repay outstanding short-term debt.

     UE may sell all, or a portion of, the remaining securities registered under
the  September  2003  shelf  registration   statement  if  warranted  by  market
conditions  and  capital  requirements.  Any offer and sale will be made only by
means of a prospectus meeting the requirements of the Securities Act of 1933 and
the rules and regulations thereunder.  At October 31, 2003, the amount remaining
under the September 2003 shelf registration statement was $800 million.

     In April 2003,  UE entered  into an  additional  364-day  committed  credit
facility  totaling  $75  million  to be  used  for  general  corporate  purposes
including  support  of  its  commercial  paper  program.   This  facility  makes
borrowings  available at various interest rates based on LIBOR, agreed rates and
other options. CIPS and CILCO can access this facility through the utility money
pool.

CIPS

     In March 2003, CIPS repaid $5 million  principal amount of its 6.99% Series
97-1 first mortgage bonds on their maturity date. In April 2003, CIPS repaid $40
million  principal  amount of its 6.375% Series Z first  mortgage bonds on their
maturity  date and also  redeemed at par,  its $50 million  7.50% Series X first
mortgage bonds due July 1, 2007. All  redemptions  and repayments were made with
available cash and borrowings from the money pool.

CILCORP

     In conjunction with Ameren's  acquisition of CILCORP,  CILCORP's  long-term
debt  amounts  have been  adjusted to fair value.  The  recording  of fair value
related adjustments  resulted in an increase of $71 million related to CILCORP's
9.375%  senior notes due 2029 and $40 million to its 8.7% senior notes due 2009.
Amortization  related to these  fair  value  adjustments  was  approximately  $2
million for the three months and $5 million for the eight months ended September
30, 2003. The  amortization was included in interest expense in the Statement of
Income for Ameren and CILCORP.

     In September  2003,  CILCORP  repurchased,  prior to maturity,  $13 million
principal amount of its 9.375% senior notes and $27 million  principal amount of
its 8.7% senior  notes.  These  repurchases  resulted in a reduction of the fair
value  write-up  of $8 million in  aggregate.  CILCORP  repurchased  these notes
through a direct loan from Ameren.

CILCO

     In February 2003,  CILCO repaid $25 million  principal  amount of its 6.82%
series  medium-term notes on their maturity date. In April 2003, three series of
CILCO's first mortgage bonds were redeemed prior to maturity.  These redemptions
included CILCO's $65 million  principal amount 8.20% series due January 15, 2022
at a  redemption  price of  103.29%,  and two 7.8% series  totaling  $10 million
principal  amount due  February 9, 2023 at a  redemption  price of  103.90%.  In
August  2003,  CILCO  repaid two bank loans  totaling $5 million  prior to their
scheduled  maturity  dates.  In July  2003,  preferred  stock was  reduced by $1
million as a result of a mandatory  sinking fund provision.  All redemptions and
repayments were made with available cash and borrowings from the money pool.

Medina Valley

     In June 2003, Medina Valley repaid, prior to maturity,  with funds borrowed
from the non-state regulated money pool, a $36 million secured term loan with an
effective interest rate of 7.65% and terminated two related interest rate swaps.
This repayment eliminated the outstanding bank debt at Medina Valley.



                                       37

<PAGE>

NOTE 5 - Other Income and Deductions

     The following  table presents Other Income and Deductions for the three and
nine months ended September 30, 2003 and 2002:

<TABLE>
<CAPTION>
   ===================================================================================================================
                                                             Three Months                      Nine Months
   -------------------------------------------------------------------------------------------------------------------
<S>                                                     <C>             <C>             <C>              <C>
                                                         2003            2002            2003             2002
                                                         ----            ----            ----             ----
   Ameren(a)
   Miscellaneous income:
      Interest and dividend income................      $   1           $   4          $   2            $   6
      Gain on disposition of property ............          -               -              -                3
      Allowance   for  equity   funds  used  during
        construction..............................          1               1              2                3
      Other.......................................          2               1             12                4
   -------------------------------------------------------------------------------------------------------------------
   Total miscellaneous income.....................      $   4           $   6          $  16            $  16
   -------------------------------------------------------------------------------------------------------------------
   Miscellaneous expense:
      Minority interest in subsidiary.............      $  (1)          $  (2)         $  (6)           $ (13)
      Donations, including 2002 rate settlement...          -               -              -              (26)
      Other.......................................         (2)             (1)            (8)              (7)
   -------------------------------------------------------------------------------------------------------------------
   Total miscellaneous expense....................      $  (3)          $  (3)         $ (14)           $ (46)
   ===================================================================================================================

   ===================================================================================================================
   UE
   Miscellaneous income:
      Interest and dividend income................      $   1           $   -          $   1            $   2
      Equity in earnings of subsidiary............          1               1              6               13
      Gain on disposition of property.............          -               -              -                3
      Allowance   for  equity   funds  used  during
        construction..............................          1               1              1                3
      Other.......................................          2               -              6                6
   -------------------------------------------------------------------------------------------------------------------
   Total miscellaneous income.....................      $   5           $   2          $  14            $  27
   -------------------------------------------------------------------------------------------------------------------
   Miscellaneous expense:
      Donations, including 2002 rate settlement...      $   -           $   -          $   -            $ (26)
      Other.......................................         (2)             (1)            (5)              (6)
   -------------------------------------------------------------------------------------------------------------------
   Total miscellaneous expense....................      $  (2)          $  (1)         $  (5)           $ (32)
   ===================================================================================================================

   ===================================================================================================================
   CIPS
   Miscellaneous income:
      Interest and dividend income................      $   7           $   8          $  21            $  24
      Other.......................................          -               -              -                1
   -------------------------------------------------------------------------------------------------------------------
   Total miscellaneous income.....................      $   7           $   8          $  21            $  25
   -------------------------------------------------------------------------------------------------------------------
   Miscellaneous expense:
      Other.......................................      $   -           $   -          $  (2)           $  (1)
   -------------------------------------------------------------------------------------------------------------------
   Total miscellaneous expense....................      $   -           $   -          $  (2)           $  (1)
   -------------------------------------------------------------------------------------------------------------------
   Genco
   Miscellaneous income:
      Other.......................................       $  -           $   -          $   2            $   -
   -------------------------------------------------------------------------------------------------------------------
   Total miscellaneous income.....................       $  -           $   -          $   2            $   -
   -------------------------------------------------------------------------------------------------------------------
   Miscellaneous expense:
      Other.......................................       $  -           $  (1)         $   -            $  (1)
   -------------------------------------------------------------------------------------------------------------------
   Total miscellaneous expense....................       $  -           $  (1)         $   -            $  (1)
   -------------------------------------------------------------------------------------------------------------------
</TABLE>
                                       38
<PAGE>
<TABLE>
<CAPTION>
   -------------------------------------------------------------------------------------------------------------------
                                                             Three Months                      Nine Months
   -------------------------------------------------------------------------------------------------------------------
<S>                                                     <C>             <C>             <C>              <C>
                                                         2003            2002            2003             2002
                                                         ----            ----            ----             ----
   CILCORP(b)
   Miscellaneous income:
      Other.......................................       $  -           $   -           $   -            $   2
   -------------------------------------------------------------------------------------------------------------------
   Total miscellaneous income.....................       $  -           $   -           $   -            $   2
   -------------------------------------------------------------------------------------------------------------------
   Miscellaneous expense:
      Company-owned life insurance................       $ (1)          $   -           $  (1)           $  (1)
      Other.......................................         (1)              -              (2)              (1)
   -------------------------------------------------------------------------------------------------------------------
   Total miscellaneous expense....................       $ (2)          $   -           $  (3)           $  (2)
   ===================================================================================================================

   ===================================================================================================================
   CILCO
   Miscellaneous income:
      Other ......................................       $  -           $   -           $   1            $   1
   -------------------------------------------------------------------------------------------------------------------
   Total miscellaneous income.....................       $  -           $   -           $   1            $   1
   -------------------------------------------------------------------------------------------------------------------
   Miscellaneous expense:
      Company-owned life insurance................       $ (1)          $   -           $  (1)           $  (1)
      Other.......................................         (1)              -              (3)              (1)
   -------------------------------------------------------------------------------------------------------------------
   Total miscellaneous expense....................       $ (2)          $   -           $  (4)           $  (2)
   ===================================================================================================================
     (a)  Excludes  amounts for CILCORP and CILCO prior to the acquisition  date
          of January 31, 2003 and  includes  amounts for  non-registrant  Ameren
          subsidiaries as well as intercompany eliminations.
     (b)  2002  amounts   represent   predecessor   information.   January  2003
          predecessor   amounts  were  zero.  CILCORP   consolidates  CILCO  and
          therefore includes CILCO amounts in its balances.

</TABLE>

NOTE 6 - Derivative Financial Instruments

Cash Flow Hedges

     The following table presents balances in certain accounts for cash flow
hedges as of September 30, 2003:

<TABLE>
<CAPTION>
   ===================================================================================================================
                                                Ameren(a)      UE       CIPS      Genco         CILCORP        CILCO
   -------------------------------------------------------------------------------------------------------------------
<S>                                             <S>          <S>       <S>       <S>            <S>           <S>
   Balance Sheet:
      Other assets.............................  $  15        $  7      $  -      $  1           $   -         $   6
      Other deferred credits and liabilities...     11           4         4         -               -             3

      Accumulated OCI:
      Power forwards(b)........................      1           -         -         -               -             -
      Interest rate swaps(c)...................      5           -         -         5               -             -
      Gas swaps and future contracts(d)........    (14)         (3)       (3)        -              (4)           (4)
      Call options(e)..........................      6           6         -         -               -             -
   ===================================================================================================================
     (a)  Excludes  amounts for CILCORP and CILCO prior to the acquisition  date
          of January 31, 2003 and  includes  amounts for  non-registrant  Ameren
          subsidiaries as well as intercompany eliminations.
     (b)  Represents  the  mark-to-market   value  for  the  hedged  portion  of
          electricity  price exposure for periods  generally less than one year.
          Certain  contracts  designated as hedges of electricity price exposure
          have terms up to five years.
     (c)  Represents a gain  associated  with  interest rate swaps at Genco that
          were a partial hedge of the interest rate on debt issued in June 2002.
          The  swaps  cover  the  first  ten  years of debt  that has a  30-year
          maturity and the gain in OCI is amortized over a ten-year  period that
          began in June 2002.
     (d)  Represents  a loss  associated  with  natural  gas  swaps  and  future
          contracts.   The  swaps  are  a  partial  hedge  of  our  natural  gas
          requirements through October 2006.
     (e)  Represents the  mark-to-market  gain of two call options accounted for
          as cash flow hedges for coal held with two suppliers. These options to
          purchase coal expire in October 2003 and July 2005. The final value of
          the options  will be  recognized  as a reduction  in fuel costs as the
          hedged coal is burned.
</TABLE>

     The  pretax  net  gain or  loss on  power  forward  derivative  instruments
included in Other Income and Deductions,  at UE and Genco, which represented the
impact of discontinued  cash flow hedges,  the ineffective  portion of cash flow
hedges,  as well as the  reversal of amounts  previously  recorded in OCI due to
transactions  going to delivery or  settlement,  totaled  less

                                       39

<PAGE>

than a $1 million gain for the three months ended  September 30, 2003 (2002 - $4
million  loss)  and  less  than a $1  million  loss for the  nine  months  ended
September 30, 2003 (2002 - $4 million loss).

Other Derivatives

     The  following  table  represents  the net change in market value of option
transactions,  which  are  used  to  manage  our  positions  in  sulfur  dioxide
allowances, coal, heating oil and electricity. Certain of these transactions are
treated as non-hedge  transactions  under SFAS 133. The net change in the market
value of sulfur  dioxide  options is recorded in Operating  Revenues - Electric,
while the net change in the market  value of coal,  heating oil and  electricity
options is  recorded as  Operating  Expenses - Fuel and  Purchased  Power in the
Statement of Income.

<TABLE>
<CAPTION>
   ===================================================================================================================
                                                                   Three Months                 Nine Months
   -------------------------------------------------------------------------------------------------------------------
<S>                                                            <C>           <C>           <C>             <C>
   Gains (Losses)(a):                                            2003         2002          2003            2002
                                                                 ----         ----          ----            ----
        Sulfur dioxide options -
          Ameren(b)........................................     $  -         $   1         $   1           $   2
          UE...............................................       (1)            1            (1)              2
          CIPS.............................................        -             -             -               -
          Genco............................................        1             -             2               -
          CILCORP(c).......................................        -             -             -               -
          CILCO............................................        -             -             -               -

        Coal options -
          Ameren(b)........................................        -             -             1               1
          UE...............................................        1             -             1               1
          CIPS.............................................        -             -             -               -
          Genco............................................        -             -             -               -
          CILCORP(c).......................................        -             -             -               -
          CILCO............................................        -             -             -               -
   ===================================================================================================================
     (a)  Heating oil and electricity options gains and losses were less than $1
          million for all periods shown above.
     (b)  Excludes  amounts for CILCORP and CILCO prior to the acquisition  date
          of January 31, 2003 and  includes  amounts for  non-registrant  Ameren
          subsidiaries as well as intercompany eliminations.
     (c)  2002  amounts   represent   predecessor   information.   January  2003
          predecessor   amounts  were  zero.  CILCORP   consolidates  CILCO  and
          therefore includes CILCO amounts in its balances.

</TABLE>

NOTE 7 - Related Party Transactions

     The Ameren  Companies  have  engaged  in, and may in the future  engage in,
affiliate  transactions  in the normal  course of business.  These  transactions
primarily  consist of gas and power  purchases and sales,  services  received or
rendered, borrowings and lendings.  Transactions between affiliates are reported
as intercompany  transactions on their financial statements,  but are eliminated
in  consolidation  for Ameren's  financial  statements  and include the material
agreements below.

Electric Power Supply Agreements

     Under two electric power supply agreements, Genco is obligated to supply to
Marketing  Company,  and Marketing  Company,  in turn, is obligated to supply to
CIPS, all of the energy and capacity  needed by CIPS to offer service for resale
to its native load customers at rates  specified by the ICC and to fulfill CIPS'
other obligations  under all applicable  federal and state tariffs or contracts.
Any power not used by CIPS is sold by Marketing  Company under various long-term
wholesale and retail  contracts.  For native load,  CIPS pays an annual capacity
charge  per  megawatt  (the  greater  of its  forecasted  peak  demand or actual
demand),  plus an energy  charge per  megawatt-hour  to Marketing  Company.  For
fixed-price retail customers outside of the tariff,  CIPS pays Marketing Company
the price it receives under these contracts.  The fees paid by CIPS to Marketing
Company for native load and fixed-price  retail customers and any other sales by
Marketing  Company under various  long-term  wholesale and retail  contracts are
passed through to Genco. In addition,  under the power supply agreement  between
Genco and Marketing Company, Genco bears all generation related operating risks,
including


                                       40

<PAGE>

plant performance,  operations, maintenance,  efficiency, employee retention and
other matters. There are no guarantees,  bargain purchase options or other terms
that may convey to CIPS the right to use the  property  and plant of Genco.  The
agreement  between CIPS and Marketing  Company expires on December 31, 2004. The
agreement  between Genco and Marketing Company can be terminated by either party
upon at least one year's notice, but may not be terminated prior to December 31,
2004. CIPS and Marketing  Company plan to pursue a renewal or extension of their
agreement  through  December 31, 2006. A renewal or extension of this  agreement
will depend on compliance  with  regulatory  requirements in effect at the time.
This extension has been  authorized by the ICC in its order  approving  Ameren's
acquisition of CILCORP and CILCO.

     On  October  3, 2003,  in  conjunction  with  CILCO's  transfer  to AERG of
substantially all of its generating assets,  AERG entered into an electric power
supply  agreement  with CILCO to supply it  sufficient  power to meet its native
load  requirements.  CILCO pays a monthly  capacity charge per megawatt based on
CILCO's system capacity  requirements,  plus an energy charge per megawatt-hour.
This  agreement  expires on December 31, 2004.  AERG and CILCO plan to pursue an
extension of the power supply agreement  through December 31, 2006. A renewal or
extension  of  this  agreement  will  depend  on  compliance   with   regulatory
requirements  in effect at the time.  The ICC  authorized  this extension in its
order approving  Ameren's  acquisition of CILCORP and CILCO. Also in conjunction
with CILCO's  generating asset transfer,  a bilateral power supply agreement was
entered into between AERG and Marketing  Company.  This  agreement  provides for
AERG to sell  excess  power to  Marketing  Company  for sales  outside the CILCO
control area, and also allows Marketing Company to sell power to AERG to fulfill
CILCO's native load requirements.

     CILCO had a power  purchase  agreement  with CIPS for the  purchase  of 100
megawatts of capacity and firm energy for the months of January and June through
September  2003 and 2002.  This power was  supplied by Genco  through  Marketing
Company, CIPS and Genco electric power supply agreements discussed above.

     UE and CIPS are parties to a power  supply  agreement  with EEI to purchase
and sell capacity and energy. This agreement expires on December 31, 2005. Under
a separate  agreement  which  expires on  December  31,  2005,  CIPS  resold its
entitlements under the power supply agreement with EEI to Marketing Company.

     UE has a 150 megawatt power supply  agreement with Marketing  Company which
expires  December  31, 2005.  UE also had a one year 450  megawatt  power supply
agreement with Marketing  Company which expired in May 2002 and another one year
200 megawatt power supply agreement with Marketing  Company which expired in May
2003.  Power  supplied by Marketing  Company to UE through these  agreements was
obtained from Genco.

Joint Dispatch Agreement

     UE and Genco jointly  dispatch  electric  generation under an amended joint
dispatch  agreement.  Under the  agreement,  each affiliate is required to serve
their load requirements from their own generation first, and then allowed access
to any available  generation from their affiliate.  The joint dispatch agreement
can be terminated by either party by giving one year's notice beginning  January
1, 2004.

Agency Agreements

     Any excess  generation  not used by UE or Genco through the joint  dispatch
agreement  is sold to third  parties  through  Ameren  Energy,  serving  as each
affiliate's agent. Ameren Energy also acts as agent on behalf of UE and Genco to
purchase power when they require it.

     Pending SEC approval,  there will be an agency  agreement  between AERG and
Marketing Company that authorizes  Marketing Company, on behalf of AERG, to sell
AERG's  excess  generation,  or  purchase  power  when  needed  to  supply  AERG
customers.

Executory Tolling, Gas Sales and Transportation Agreements

     Under an executory tolling agreement,  CILCO purchases steam, chilled water
and electricity  from Medina Valley.  In connection with this agreement,  Medina
Valley purchases gas from AFS under a fuel supply and services agreement.  Prior
to September 2003, Medina Valley purchased gas from CESI and gas  transportation
from CILCO.

                                       41

<PAGE>


     Under a special contract rate, gas transportation agreement, Genco acquires
gas  transportation  service  from  UE for  its  Columbia,  Missouri  generating
facility. This agreement expires in February 2016.

Support Services Agreements

     Costs of support services  provided by Ameren  Services,  Ameren Energy and
AFS to  their  affiliates,  including  wages,  employee  benefits,  professional
services and other  expenses are based on, or are an allocation of, actual costs
incurred.

Money Pools

Utility

     UE,  CIPS and CILCO have the  ability to borrow  from Ameren and each other
through a utility money pool agreement.  In September  2003,  CILCO received the
final  required  regulatory  approval  necessary  for its  participation  in the
utility money pool. In October 2003, AERG also received the required  regulatory
approval  necessary to  participate in the utility money pool.  Ameren  Services
administers  the  utility  money pool and tracks  internal  and  external  funds
separately.  Ameren Services also participates in the utility money pool. Ameren
and AERG may only  participate  in the utility money pool as a lender.  Internal
funds are surplus funds contributed to the utility money pool from participants.
The  primary  source of  external  funds for the  utility  money  pool is the UE
commercial paper program.  Through the utility money pool, the pool participants
can access committed  credit  facilities at Ameren which totaled $600 million at
September 30, 2003. These facilities are in addition to UE's $157 million, CIPS'
$15 million and CILCO's $60 million in committed  credit  facilities.  The total
amount  available to the pool  participants  from the utility  money pool at any
given  time is  reduced by the amount of  borrowings  by their  affiliates,  but
increased  to the  extent  the pool  participants  have  surplus  funds or other
external sources are used to increase the available amounts. The availability of
funds is also determined by funding  requirement  limits  established by the SEC
under PUHCA.  UE, CIPS, CILCO and Ameren Services rely on the utility money pool
to  coordinate  and  provide  for certain  short-term  cash and working  capital
requirements.  Borrowers receiving a loan under the utility money pool agreement
must repay the principal  amount of such loan,  together with accrued  interest.
The rate of interest  depends on the  composition of internal and external funds
in the utility money pool.  The average  interest  rate for borrowing  under the
utility money pool for the three months ended September 30, 2003 was 1.02% (2002
- 1.73%) and for the nine  months  ended  September  30,  2003 was 1.17% (2002 -
1.75%).

Non-State Regulated

     Genco and other non-state regulated Ameren subsidiaries have the ability to
borrow up to $600  million in total from Ameren  through a  non-state  regulated
subsidiary money pool agreement. However, the total amount available to the pool
participants  at any time is reduced by the amount of borrowings  from Ameren by
its subsidiaries and is increased to the extent other pool participants  advance
surplus  funds to the  non-state  regulated  subsidiary  money pool, or external
sources are used to increase the available amounts.  At September 30, 2003, $600
million was available  through the non-state  regulated  subsidiary  money pool,
excluding additional funds available through excess cash balances. The non-state
regulated  subsidiary  money pool was  established to coordinate and provide for
short-term cash and working capital requirements of Ameren's non-state regulated
activities and is administered by Ameren  Services.  Borrowers  receiving a loan
under the non-state  regulated  subsidiary  money pool  agreement must repay the
principal  amount of such loan,  together  with  accrued  interest.  The rate of
interest  depends on the  composition  of  internal  and  external  funds in the
non-state regulated  subsidiary money pool. These rates are based on the cost of
funds used to fund money pool advances. Ameren and CILCORP are authorized to act
only as lenders to the  non-state  regulated  subsidiary  money pool. In October
2003, AERG received the required regulatory approval necessary to participate in
the non-state  regulated  subsidiary  money pool. The average  interest rate for
borrowing  under the  non-state  regulated  subsidiary  money pool for the three
months ended September 30, 2003 was 8.84% (2002 - 8.84%) and for the nine months
ended September 30, 2003 was 8.84% (2002 - 7.18%).

     CILCORP has been  granted  authority by the SEC under PUHCA to borrow up to
$250 million  directly  from Ameren in a separate  arrangement  unrelated to the
money pools.


                                       42

<PAGE>

Operating Lease

     Under an operating lease  agreement,  Genco is leasing  certain  combustion
turbine  generating units at a Joppa,  Illinois site to its parent,  Development
Company.  Under an electric  power  supply  agreement  with  Marketing  Company,
Development  Company supplies the capacity and energy from these leased units to
Marketing Company, which in turn supplies the energy to Genco.

UE

     The following  tables present the impact of related party  transactions  on
UE's  Statement of Income and Balance  Sheet based  primarily on the  agreements
discussed above:

<TABLE>
<CAPTION>
   ===================================================================================================================
   Statement of Income:                                       Three Months                     Nine Months
   -------------------------------------------------------------------------------------------------------------------
<S>                                                     <C>              <C>             <C>              <C>
                                                          2003            2002            2003             2002
                                                          ----            ----            ----             ----
   Operating revenues from affiliates:
        Power supply agreement with EEI..........        $   4           $   6           $   5            $   9
        Joint dispatch agreement with Genco.........        23              15              79               49
        Agency agreement with Ameren Energy.........        44              37             155              131
        Gas transportation agreement with Genco.....         -               -               1                1
   -------------------------------------------------------------------------------------------------------------------
        Total operating revenues...................      $  71           $  58           $ 240            $ 190

   Fuel and purchased power expenses from affiliates:
        Power supply agreements:
          EEI.......................................     $  15           $  14           $  43            $  40
          Marketing Company.........................         2               7               7               14
        Joint dispatch agreement with Genco.........        13              15              31               33
        Agency agreement with Ameren Energy.........        14              21              42               88
    ------------------------------------------------------------------------------------------------------------------
        Total fuel and purchased power expenses.....     $  44           $  57           $ 123            $ 175

   Other operating expenses:
        Support service agreements:
          Ameren Services...........................     $  40           $  43           $ 126            $ 123
          Ameren Energy.............................         8               9              18               27
          AFS.......................................         1               1               5                3
   -------------------------------------------------------------------------------------------------------------------
          Total other operating expenses............     $  49           $  53           $ 149            $ 153

   Interest expense:
   Borrowings related to money pool.................     $   -           $   -           $   2            $   1
   ===================================================================================================================

   ===================================================================================================================
   Balance Sheet:                                             September 30, 2003              December 31,2002
   -------------------------------------------------------------------------------------------------------------------
   Assets:
        Miscellaneous accounts and notes receivable......           $    25                      $     25
   Liabilities:
        Accounts payable and wages payable...............           $    57                      $    103
        Borrowings from money pool.......................               230                            15
   ===================================================================================================================
</TABLE>

                                       43

<PAGE>


CIPS

     The following  tables present the impact of related party  transactions  on
CIPS'  Statement of Income and Balance Sheet based  primarily on the  agreements
discussed above:

<TABLE>
<CAPTION>

   ===================================================================================================================
   Statement of Income:                                       Three Months                     Nine Months
   -------------------------------------------------------------------------------------------------------------------
<S>                                                      <C>             <C>             <C>              <C>
                                                          2003            2002            2003             2002
                                                          ----            ----            ----             ----
   Operating revenues from affiliates:
        Power supply agreements:
          Marketing Company.........................      $  7           $   7           $  22            $  20
          CILCO.....................................         6               5               8                7
   ------------------------------------------------------------------------------------------------------------------
        Total revenues..............................      $ 13           $  12           $  30            $  27

   Fuel and purchased power expenses from affiliates:
        Power supply agreements:
          Marketing Company.........................      $ 90           $ 111           $ 243            $ 304
          EEI.......................................         7               6              22               19
   ------------------------------------------------------------------------------------------------------------------
        Total fuel and purchased power expenses.....      $ 97           $ 117           $ 265            $ 323

   Other operating expenses:
        Support service agreements:
          Ameren Services...........................      $ 13           $  15           $  42            $  46
          AFS.......................................         -               -               1                1
    -----------------------------------------------------------------------------------------------------------------
         Total other operating expenses.............      $ 13           $  15           $  43            $  47

   Interest expense (income):
        Note receivable from Genco..................      $  7           $   7           $  21            $  23
        Borrowings (advances) related to money
          pool......................................      $  -           $   -           $   -            $  (1)
   ===================================================================================================================

   ===================================================================================================================
   Balance Sheet:                                              September 30, 2003            December 31,2002
   -------------------------------------------------------------------------------------------------------------------
   Assets:
        Miscellaneous accounts and notes receivable.........        $   11                     $     12
        Advances to money pool...............................            -                           16
        Promissory note receivable from Genco(a).............          373                          419
        Tax receivable from Genco............................          166                          175
   Liabilities:
        Accounts payable and wages payable...................       $   76                     $     63
        Borrowings from money pool...........................           23                            -
   ===================================================================================================================
     (a)  Amount  includes  current  portion of $49 million as of September  30,
          2003 (December 31, 2002 - $46 million).

</TABLE>
                                       44

<PAGE>

Genco

     The following  tables present the impact of related party  transactions  on
Genco's  Statement of Income and Balance Sheet based primarily on the agreements
discussed above:

<TABLE>
<CAPTION>

   ===================================================================================================================
   Statement of Income:                                       Three Months                     Nine Months
   -------------------------------------------------------------------------------------------------------------------
<S>                                                     <C>             <C>              <C>              <C>
                                                          2003           2002             2003             2002
                                                          ----           ----             ----             ----
   Operating revenues from affiliates:
        Power supply agreements:
          Marketing Company.........................    $   177        $  177           $  477          $   472
          EEI.......................................          3             3                4                4
        Joint dispatch agreement with UE............         13            15               31               33
        Agency agreement with Ameren Energy.........         19            10               73               43
        Operating lease with Development Company....          3             3                8                8
   -------------------------------------------------------------------------------------------------------------------
        Total operating revenues ...................    $   215        $  208           $  593          $   560

   Fuel and purchased power expenses from affiliates:
        Joint dispatch agreement with UE............    $    23        $   15           $   79          $    50
        Agency agreement with Ameren Energy.........          7             7               22               24
        Power purchase agreement with Marketing
          Company...................................          1             1                1                1
        Gas transportation agreement with UE........          -             -                1                1
   -------------------------------------------------------------------------------------------------------------------
        Total fuel and purchased power expenses.....    $    31        $   23           $  103          $    76

   Other operating expenses:
        Support service agreements:
          Ameren Services...........................    $     5        $    4           $   14          $    14
          Ameren Energy.............................          4             4                9               13
          AFS.......................................          1             -                2                1
   -------------------------------------------------------------------------------------------------------------------
        Total other operating expenses..............    $    10        $    8           $   25          $    28

   Interest expense:
        Borrowings related to money pool............    $     4        $    -           $   12          $     5
        Note payable to CIPS........................    $     7        $    7           $   21          $    23
        Note payable to Ameren......................    $     1        $    1           $    2          $     2
   ===================================================================================================================
</TABLE>

<TABLE>
<CAPTION>

   ===================================================================================================================
   Balance Sheet:                                              September 30, 2003           December 31, 2002
   -------------------------------------------------------------------------------------------------------------------
<S>                                                               <C>                          <C>
   Assets:
        Miscellaneous accounts and notes receivable..........      $  134                       $    68
   Liabilities:
        Accounts payable and wages payable...................      $   42                       $    32
        Interest payable.....................................           7                             7
        Promissory note payable to CIPS(a)...................         373                           419
        Promissory note payable to Ameren(b).................          38                            42
        Tax payable to CIPS..................................         166                           175
        Borrowings from money pool...........................         177                           191
   ===================================================================================================================
     (a)  Amount  includes  current  portion of $49 million as of September  30,
          2003 (December 31, 2002 - $46 million).
     (b)  Amount includes current portion of $4 million as of September 30, 2003
          (December 31, 2002 - $4 million).

 </TABLE>
                                      45

<PAGE>

CILCORP

     The following  tables present the impact of related party  transactions  on
CILCORP's  Statement  of  Income  and  Balance  Sheet  based  primarily  on  the
agreements discussed above:

<TABLE>
<CAPTION>
   ===================================================================================================================
   Statement of Income(a)(b):                                 Three Months                     Nine Months
   -------------------------------------------------------------------------------------------------------------------
<S>                                                      <C>             <C>             <C>              <C>
                                                          2003            2002            2003             2002
                                                          ----            ----            ----             ----
   Operating revenues from affiliates:
        Fuel supply and services agreement with
          Medina Valley.............................     $   3           $   3           $  12            $  11
   -------------------------------------------------------------------------------------------------------------------
        Total revenues..............................     $   3           $   3           $  12            $  11

   Fuel and purchased power expenses from affiliates:
        Executory tolling agreement with Medina
          Valley....................................     $   7           $   6           $  22            $  18
        Power purchase agreement with CIPS..........         1               -               1                -
   -------------------------------------------------------------------------------------------------------------------
        Total fuel and purchased power expenses.....     $   8           $   6           $  23            $  18

   Other operating expenses:
        Support services agreements:
          Ameren Services...........................     $   6           $   -           $   7            $   -
          AFS.......................................         -               -               1                -
   -------------------------------------------------------------------------------------------------------------------
        Total other operating expenses..............     $   6           $   -           $   8            $   -

   Interest expense:
        Note payable to Ameren......................     $   -           $   -           $   -            $   -
        Borrowings related to money pool............     $   -           $   -           $   -            $   -
   ===================================================================================================================
     (a)  2002 amounts represent predecessor  information.  2003 amounts include
          January  2003  predecessor  information  which  included $2 million in
          operating  revenues and $3 million in purchased power  associated with
          the agreement with Medina Valley.
     (b)  CILCORP consolidates CILCO and therefore includes CILCO amounts in its
          balances.

</TABLE>

<TABLE>
<CAPTION>

   ===================================================================================================================
   Balance Sheet(a):                                           September 30, 2003           December 31, 2002
   -------------------------------------------------------------------------------------------------------------------
<S>                                                                <C>                          <C>
   Assets:
        Miscellaneous accounts and notes receivable ........        $   3                        $   2
   Liabilities:
        Accounts payable.....................................       $  19                        $   3
        Note payable to Ameren...............................          31                            -
        Borrowings from money pool...........................         109                            -
   ===================================================================================================================
     (a)  CILCORP consolidates CILCO and therefore includes CILCO amounts in its
          balances.
</TABLE>

                                       46

<PAGE>

CILCO

     The following  tables present the impact of related party  transactions  on
CILCO's  Statement  of Income and Balance  Sheet based  primarily on the various
agreements discussed above:

<TABLE>
<CAPTION>

   ===================================================================================================================
   Statement of Income(a):                                    Three Months                     Nine Months
   -------------------------------------------------------------------------------------------------------------------
<S>                                                      <C>             <C>             <C>              <C>
                                                          2003            2002            2003             2002
                                                          ----            ----            ----             ----
   Fuel and purchased power expenses from affiliates:
        Executory tolling agreement with Medina
          Valley....................................     $   7           $   6           $  22            $  18
        Power purchase agreement with CIPS..........         1               -               1                -
   -------------------------------------------------------------------------------------------------------------------
        Total fuel and purchased power expenses.....     $   8           $   6           $  23            $  18

   Other operating expenses:
        Support services agreements:
          Ameren Services...........................     $   6           $   -           $   7            $   -
          AFS.......................................         -               -               1                -
   -------------------------------------------------------------------------------------------------------------------
        Total other operating expenses..............     $   6           $   -           $   8            $   -
   -------------------------------------------------------------------------------------------------------------------

   Interest expense:
        Borrowings related to money pool............     $   -           $   -           $   -            $   -
   ===================================================================================================================
     (a)  2002 amounts represent predecessor  information.  2003 amounts include
          January  2003  predecessor  information  which  included $2 million in
          operating  revenues and $3 million in purchased power  associated with
          the agreement with Medina Valley.
</TABLE>

<TABLE>
<CAPTION>

   ===================================================================================================================
   Balance Sheet:                                              September 30, 2003           December 31, 2002
   -------------------------------------------------------------------------------------------------------------------
<S>                                                                <C>                           <C>
   Assets:
        Miscellaneous accounts and notes receivable.........        $   1                         $   -
   Liabilities:
        Accounts payable ....................................       $  26                         $   3
        Borrowings from money pool...........................         109                             -
   ===================================================================================================================
</TABLE>

NOTE 8 - Commitments and Contingencies

Environmental Matters

     In June 2000, the EPA notified UE and numerous other  companies that former
landfills  and lagoons in Sauget,  Illinois,  may contain  soil and  groundwater
contamination.  One of these sites is known as Sauget Area 1. In September 2000,
the DOJ was  granted  leave  by the  United  States  District  Court -  Southern
District of Illinois to add  numerous  additional  parties,  including  UE, to a
pre-existing  lawsuit  between the government and others relating to Sauget Area
1. The government seeks recovery of response costs under the CERCLA  (Superfund)
incurred in connection with the remediation of Sauget Area 1. In September 2003,
UE and the DOJ agreed to the terms of a stipulation that calls for the dismissal
of UE from the litigation. As a part of the stipulation, the government reserves
the right to refile its claim in the event that evidence is  discovered  that UE
contributed to the  environmental  conditions at issue. UE does not believe that
it is responsible for the environmental contamination at Sauget Area 1.

     In October 2003,  the EPA finalized  regulations  revising the NSR programs
under  the  Clean  Air  Act,  including  the  routine  maintenance,  repair  and
replacement  exclusions to those programs.  The regulations define categories of
construction projects that are exempt from stringent permitting requirements and
provide greater regulatory  certainty as to when pollution control  technologies
must be installed at a facility.  The regulations are controversial and a number
of states,  including  Illinois  where  many of our  generating  facilities  are
located, and environmental groups have challenged the regulations. Unless a stay
is issued, the regulations will become effective as of December 26, 2003. During
the Clinton  Administration,  the EPA and the DOJ initiated  enforcement actions
against various utilities for alleged violations of the

                                       47

<PAGE>

NSR programs.  None of the Ameren Companies have been named in those enforcement
actions.  It is uncertain whether additional  enforcement  actions will be filed
following the effective date of the NSR regulations.

     In April  2002,  the EPA  proposed  rules  under the  Clean  Water Act that
require  that  cooling  water  intake  structures  reflect  the best  technology
available for minimizing adverse environmental  impacts.  These rules pertain to
existing  generating  facilities  that  currently  employ a cooling water intake
structure  whose flow  exceeds 50 million  gallons  per day.  Originally,  final
action on the proposed  rules was  expected by August 2003.  Final action is now
expected  by  February  2004.  The  proposed  rule  may  require  us to  install
additional  intake screens or other  protective  measures,  as well as extensive
site specific study and monitoring  requirements.  There is also the possibility
that the proposed rules may lead to the  installation  of cooling towers on some
of our  facilities.  Our compliance  costs  associated  with the final rules are
unknown, but could be material.

Asbestos-Related Litigation

     Ameren,  UE,  CIPS,  Genco and CILCO have been named,  along with  numerous
other  parties,  in a number  of  lawsuits  which  have  been  filed by  certain
plaintiffs claiming varying degrees of injury from asbestos exposure.  Most have
been filed in the Circuit Court of Madison County, Illinois. The number of total
defendants  named in each case is significant  with as many as 110 parties named
in a case to as few as six. However,  the average number of parties is 60 in the
cases that are currently pending.

     The claims filed against  Ameren,  UE, CIPS,  Genco and CILCO allege injury
from  asbestos  exposure  during  the  plaintiffs'  activities  at our  electric
generating  plants.  In the case of CIPS,  its  former  plants  are now owned by
Genco,  and in the case of CILCO,  most of its  former  plants  are now owned by
AERG.  Each lawsuit seeks  unspecified  damages in excess of $50,000,  which, if
proved, typically would be shared among the named defendants.

     Since the filing of the  Ameren  Companies'  Form  10-Qs for the  quarterly
period ended June 30, 2003,  nine  additional  lawsuits  have been filed against
Ameren, UE and CIPS, mostly in the Circuit Court of Madison County, Illinois and
two cases have been  settled.  The  following  table  presents the status of the
asbestos-related  lawsuits that have been filed against the Ameren  Companies as
of October 31, 2003:

<TABLE>
<CAPTION>

   ===================================================================================================================
                                                               Specifically Named as Defendant
                                               -----------------------------------------------------------------------
                                    Total(a)     Ameren        UE          CIPS           Genco           CILCO
   -------------------------------------------------------------------------------------------------------------------
<S>                                   <C>          <C>        <C>           <C>            <C>              <C>
   Filed..........................     173     |    14         116           66              2               13
   Settled........................      19     |     -          13            8              -                1
   Dismissed......................      63     |     -          48           20              -                1
   Pending........................      91     |    14          55           38              2               11
   ===================================================================================================================
     (a)  Addition of the numbers in the  individual  columns does not equal the
          total  column  because  some  of the  lawsuits  name  multiple  Ameren
          entities as defendants.
</TABLE>

     Ameren,  UE, CIPS,  Genco and CILCO believe that the final  disposition  of
these  proceedings  will not have a material  adverse effect on their  financial
position, results of operations or liquidity.


NOTE 9 - Stockholders' Equity

Paid-In Capital

     Ameren's  paid-in capital  increased by $325 million at September 30, 2003,
as compared to December 31, 2002,  as a result of the issuance of 6.325  million
common  shares in the first  quarter of 2003 and common shares issued during the
first  nine  months  of 2003  related  to its  benefit  plan  and  its  dividend
reinvestment and stock purchase plan.

     CILCORP's  paid-in capital decreased by $30 million as a result of Ameren's
acquisition  of CILCORP in January 2003 in order to reflect  Ameren's  equity in
CILCORP. See Note 2 - Acquisitions for further information.


                                       48


<PAGE>

Other Comprehensive Income

     Comprehensive  income  includes net income as reported on the  Consolidated
Statements  of Income  and all other  changes  in common  stockholders'  equity,
except  those  resulting  from   transactions   with  common   stockholders.   A
reconciliation  of net income to  comprehensive  income for the three months and
nine  months  ended  September  30,  2003 and 2002 is shown below for the Ameren
Companies:

<TABLE>
<CAPTION>

   ===================================================================================================================
                                                                    Three Months                  Nine Months
   -------------------------------------------------------------------------------------------------------------------
<S>                                                            <C>           <C>             <C>            <C>
                                                                2003          2002            2003           2002
                                                                ----          ----            ----           ----
   Ameren(a)
   Net income...........................................       $  275        $  240        $    486        $   414
   Unrealized gain (loss) on derivative hedging
     instruments, net of taxes of $ (1), $ 3, $ (3), $ 4...        (3)            3              (8)             4
   Reclassification adjustments  for gains (losses)
     included in net income, net of taxes of $ -, $ -, $(1),
     $ (2).................................................         -             1              (2)            (2)
   -------------------------------------------------------------------------------------------------------------------
        Total comprehensive income, net of taxes...........    $  272        $  244        $    476        $   416
   ===================================================================================================================

   ===================================================================================================================
   UE
   Net income..............................................    $  225        $  206        $    400        $   364
   Unrealized gain (loss) on derivative hedging
     instruments, net of taxes of $ (1), $ 2, $ (2), $ 3...         -             2              (2)             4
   Reclassification adjustments for gains (losses) included
     in net income, net of taxes of $ -, $ -, $ -, $ (1)...         -             1              (1)            (1)
   -------------------------------------------------------------------------------------------------------------------
        Total comprehensive income, net of taxes...........    $  225        $  209        $    397        $   367
   ===================================================================================================================

   ===================================================================================================================
   CIPS
   Net income..............................................    $   26        $   24        $     31        $    34
   Unrealized gain (loss) on derivative hedging
     instruments, net of taxes of $ -, $ -, $ (1), $ -.....        (1)            -              (3)             -
   -------------------------------------------------------------------------------------------------------------------
        Total comprehensive income, net of taxes...........    $   25        $   24        $     28        $    34
   ===================================================================================================================

   ===================================================================================================================
   Genco
   Net income..............................................    $   17        $   15        $     65        $    31
   Unrealized gain (loss) on derivative hedging
     instruments, net of taxes of $ -, $ 1, $ -, $ -.......        (1)            1              (1)             -
   -------------------------------------------------------------------------------------------------------------------
        Total comprehensive income, net of taxes...........    $   16        $   16        $     64        $    31
   ===================================================================================================================

   ===================================================================================================================
   CILCORP(b)
   Net income..............................................    $   11        $   23        $     23        $    29
   Unrealized gain (loss) on derivative hedging
     instruments, net of taxes of $ -, $ -, $ (1), $ 3.....        (3)            1              (4)             6
   -------------------------------------------------------------------------------------------------------------------
        Total comprehensive income, net of taxes...........    $    8        $   24        $     19        $    35
   ===================================================================================================================

   ===================================================================================================================
   CILCO
   Net income..............................................    $   15        $   29        $     55        $    47
   Unrealized gain (loss) on derivative hedging
     instruments, net of taxes of $ -, $ -, $ (1), $ 3.....        (3)            1              (4)             6
   -------------------------------------------------------------------------------------------------------------------
        Total comprehensive income, net of taxes...........    $   12        $   30        $     51        $    53
   ===================================================================================================================
     (a)  Excludes  amounts for CILCORP and CILCO prior to the acquisition  date
          of January 31, 2003 and  includes  amounts for  non-registrant  Ameren
          subsidiaries as well as intercompany eliminations.
     (b)  2002  amounts  represent  predecessor  information  and  2003  amounts
          include January 2003 predecessor information, which was zero. See Note
          2 -  Acquisitions  for January data.  CILCORP  consolidates  CILCO and
          therefore includes CILCO amounts in its balances.
</TABLE>
                                       49

<PAGE>

Outstanding Shares of Common Stock

     The following table  reconciles the outstanding  Ameren common stock shares
for the three months and nine months ended September 30, 2003 and 2002:

<TABLE>
<CAPTION>

   ===================================================================================================================
                                                                    Three Months                   Nine Months
   -------------------------------------------------------------------------------------------------------------------
<S>                                                             <C>             <C>            <C>           <C>
                                                                 2003            2002           2003          2002
                                                                 ----            ----           ----          ----
   Shares outstanding at beginning of period.............       161.7           144.8          154.1         138.0
   Shares issued.........................................         0.6             8.7            8.2          15.5
   -------------------------------------------------------------------------------------------------------------------
        Shares outstanding at end of period..............       162.3           153.5          162.3         153.5
   ===================================================================================================================
</TABLE>

NOTE 10 - Segment Information

     Ameren's principal business segment,  Utility  Operations,  is comprised of
UE, CIPS,  Genco,  CILCO and  Ameren's  60% interest in EEI,  along with several
other utility  entities.  These  businesses  provide electric and gas service in
portions of Missouri and  Illinois.  The Other  reportable  segment  principally
includes   unallocated   corporate   expenses  and  certain  other   non-utility
operations.

     The accounting  policies of the segments are the same as those described in
Note 1 - Summary of  Significant  Accounting  Policies.  Segment  data  includes
intersegment   revenues,   as  well  as  a  charge  for   allocating   costs  of
administrative  support services to each of the operating  companies,  which, in
each  case,  is  eliminated  upon   consolidation.   Ameren  Services  allocates
administrative  support services to each segment based on various factors,  such
as headcount, number of customers and total assets.

     The following table presents  segment  information for Ameren for the three
and nine months ended September 30, 2003 and 2002:

<TABLE>
<CAPTION>

   ===================================================================================================================
                                                                                         Intercompany
                                                  Utility                                  Revenue
                                                Operations      Other     Subtotal       Eliminations        Total
   -------------------------------------------------------------------------------------------------------------------
<S>                                             <C>           <C>         <C>           <C>               <C>
   Three months 2003:
     Revenues...............................     $  1,535      $   27      $ 1,562      $    (212)         $  1,350
     Net income.............................          280          (5)         275              -               275
   -------------------------------------------------------------------------------------------------------------------
   Three months 2002:
     Revenues...............................     $  1,373      $   16      $ 1,389      $    (223)         $  1,166
     Net income.............................          240           -          240              -               240
   -------------------------------------------------------------------------------------------------------------------
   Nine months 2003(a):
     Revenues...............................     $  4,025      $   95      $ 4,120      $    (574)         $  3,546
     Net income.............................          497         (11)         486              -               486
   -------------------------------------------------------------------------------------------------------------------
   Nine months 2002:
     Revenues...............................     $  3,561      $   44      $ 3,605      $    (587)         $  3,018
     Net income.............................          415          (1)         414              -               414
   ===================================================================================================================
     (a)  Excludes  amounts for CILCORP and CILCO prior to the acquisition  date
          of January 31, 2003.

</TABLE>

                                       50

<PAGE>

     As a  result  of the  acquisition  of  CILCORP  as  discussed  in  Note 2 -
Acquisitions, segment data for CILCORP is now being presented in the same manner
as Ameren's.  The following table presents  segment  information for CILCORP for
the three and nine months ended September 30, 2003 and 2002:

<TABLE>
<CAPTION>

   ===================================================================================================================
                                                                     Utility Operations       Other          Total
   -------------------------------------------------------------------------------------------------------------------
<S>                                                                    <C>                  <C>            <C>
   Three months 2003:
     Revenues....................................................       $    203             $   12         $   215
     Net income..................................................             15                 (4)             11
   -------------------------------------------------------------------------------------------------------------------
   Eight months 2003:
     Revenues....................................................       $    528             $   63         $   591
     Net income..................................................             23                 (9)             14
   -------------------------------------------------------------------------------------------------------------------
   January 2003(a):
     Revenues....................................................       $     93             $   12         $   105
     Net income..................................................             31                (22)              9
   -------------------------------------------------------------------------------------------------------------------
   Three months 2002(a):
     Revenues....................................................       $    195             $   10         $   205
     Net income..................................................             28                 (5)             23
   -------------------------------------------------------------------------------------------------------------------
   Nine months 2002(a):
     Revenues....................................................       $    546             $   39         $   585
     Net income..................................................             45                (16)             29
   ===================================================================================================================
     (a)  2002  amounts  represent  predecessor  information  and  2003  amounts
          include   January  2003   predecessor   information.   See  Note  2  -
          Acquisitions  for  January  data.   CILCORP   consolidates  CILCO  and
          therefore includes CILCO amounts in its balances.

</TABLE>

     The  operations  of UE, CIPS,  Genco and CILCO are  classified  entirely as
Utility Operations and, therefore, segment presentations for these companies are
not applicable.

                                       51

<PAGE>


ITEM 2. Management's  Discussion and Analysis of Financial Condition and Results
        of Operations.

OVERVIEW

     Ameren is a public utility  holding  company  registered with the SEC under
the PUHCA and is headquartered in St. Louis,  Missouri. Our principal businesses
are involved in the generation,  transmission  and  distribution of electricity,
and the distribution of natural gas, to residential,  commercial, industrial and
wholesale users in the central United States.  Ameren's  principal  subsidiaries
are as follows:

o    UE, which operates a rate-regulated  electric generation,  transmission and
     distribution  business,  and  a  rate-regulated  natural  gas  distribution
     business in Missouri and Illinois.
o    CIPS, which operates a rate-regulated electric and natural gas transmission
     and distribution business in Illinois.
o    CILCO,  a  subsidiary  of  CILCORP (a holding  company),  which  operates a
     rate-regulated  electric  transmission  and  distribution  business,  a non
     rate-regulated  electric  generation  business (AERG), and a rate-regulated
     natural  gas  distribution  business  in  Illinois.  Ameren  completed  its
     acquisition of CILCORP on January 31, 2003.  See Note 2 -  Acquisitions  to
     our financial  statements under Item 1 of Part 1 of this report for further
     information.
o    Resources  Company,  which  consists  of  non  rate-regulated   operations.
     Subsidiaries  include Genco, which operates a non  rate-regulated  electric
     generation  business in Illinois and  Missouri;  Marketing  Company,  which
     markets power for periods primarily over one year; AFS, which procures fuel
     and manages the related risks for Ameren's affiliated companies; and Medina
     Valley, which indirectly owns a 40 megawatt,  gas-fired electric generation
     plant.  Ameren completed its acquisition of AES Medina Valley Cogen (No. 4)
     LLC on  February  4,  2003.  See  Note 2 -  Acquisitions  to our  financial
     statements under Item 1 of Part 1 of this report for further information.
o    Ameren Energy,  which serves as a power marketing and risk management agent
     for Ameren and its subsidiaries for transactions of primarily less than one
     year.
o    EEI, which operates  electric  generation  and  transmission  facilities in
     Illinois. Ameren has a 60% ownership interest in EEI through UE, which owns
     40%, and Resources  Company,  which owns 20%. Ameren  consolidates  EEI for
     financial  reporting  purposes,  while UE and Resources  Company report EEI
     under the equity method.
o    Ameren Services, which provides a variety of shared support services to us.

     In  October  2003,  CILCO  transferred  its Duck  Creek  and E. D.  Edwards
coal-fired  plants  and  its  Sterling  Avenue  combustion   turbine  facilities
representing  in  the  aggregate   approximately  1,100  megawatts  of  electric
generating capacity to its wholly-owned subsidiary, AERG, in exchange for all of
the outstanding stock of AERG and AERG's assumption of certain liabilities.  The
net book value of the transferred  assets was approximately  $378 million and no
gain or loss was recognized as the  transaction  was accounted for as a transfer
between entities under common control.  Approximately  23% of CILCO's  employees
were transferred to AERG as a part of the transaction.

     When  we  refer  to  our,  we or  us,  it  indicates  that  the  referenced
information  is common to all Ameren  Companies.  When we refer to  financing or
acquisition  activities,  we are defining Ameren as the parent holding  company.
When  appropriate,  our  subsidiaries  are  specifically  referenced in order to
distinguish among their different business activities.

     The financial statements of Ameren, UE, CILCORP and CILCO are prepared on a
consolidated  basis and therefore  include the accounts of their  majority-owned
subsidiaries.  Results of CILCORP and CILCO  reflected in Ameren's  consolidated
financial statements include the period from the acquisition date of January 31,
2003 through  September  30, 2003.  January 2003 and prior year data for CILCORP
and  CILCO  is not  included  in  Ameren's  consolidated  totals.  See  Note 2 -
Acquisitions for further information.  All significant intercompany transactions
have been  eliminated.  All  tabular  dollar  amounts  are in  millions,  unless
otherwise indicated.

     In  order  to be  more  consistent  with  industry  reporting  trends,  our
Statements of Income in this filing have been reclassified to present all income
taxes as one line item. Previously, we reported a portion of our income taxes in
Operating  Expenses  and a portion in Other Income and  Deductions.  This change
results in our calculation of Operating Income now being on a pre-tax basis with
no effect on net income. Additionally, our Balance Sheet presentations have been
reformatted to change the order in which current and  non-current  items appear,
with no effect on total assets, total liabilities or any sub-categories included
on our Balance Sheet.

                                       52

<PAGE>

     Our  accounting  policies  conform to GAAP,  and our financial  statements,
while  unaudited,  reflect all  adjustments  (which  include  normal,  recurring
adjustments)  necessary,  in our opinion, for a fair presentation of our interim
results.  Certain  information  and footnote  disclosures  normally  included in
annual audited financial  statements  prepared in accordance with GAAP have been
omitted  pursuant  to the rules and  regulations  of the SEC.  As the  unaudited
interim  financial  statements  included  herein  do  not  include  all  of  the
information  and footnote  disclosures  required by GAAP, they should be read in
conjunction with the financial  statements and the notes thereto included in the
respective 2002 Annual Reports on Form 10-K of the Ameren Companies.

     The  preparation of financial  statements in conformity  with GAAP requires
management to make estimates and  assumptions.  Such  estimates and  assumptions
affect the  reported  amounts  of assets  and  liabilities,  the  disclosure  of
contingent assets and liabilities at the dates of financial statements,  and the
reported  amounts of revenues and expenses  during the reporting  periods.  As a
result,  actual  results  could  differ  from those  estimates.  The  results of
operations for an interim period may not give a true indication of results for a
full year.

     As permitted by rules of the SEC, Ameren did not "push down" the effects of
purchase   accounting   to  the   financial   statements  of  any  of  CILCORP's
subsidiaries.   Accordingly,   CILCORP's  post-acquisition  financial  statement
amounts reflect a new basis of accounting, and separate financial statements are
presented for  pre-acquisition  (predecessor) and  post-acquisition  (successor)
periods,  separated  by a bold black  line.  CILCO's  financial  statements  are
presented on a historical  basis of accounting for all periods  presented.  As a
result  of  the   acquisition   of  CILCORP  on  January   31,   2003,   certain
reclassifications  have been made to CILCORP's and CILCO's prior year  financial
statements to conform to our current presentation.

     Our results of  operations  and  financial  position  are  affected by many
factors.  Weather,  economic  conditions  and the  actions of key  customers  or
competitors can  significantly  impact the demand for our services.  Our results
are also affected by seasonal  fluctuations  caused by winter heating and summer
cooling demand.  With approximately 90% of Ameren's revenues directly subject to
regulation by various state and federal  agencies,  decisions by regulators  can
have a material  impact on the price we charge for our services.  We principally
utilize coal,  nuclear fuel,  natural gas and oil in our operations.  The prices
for these commodities can fluctuate  significantly due to the world economic and
political environment,  weather, production levels and many other factors. We do
not have fuel cost recovery  mechanisms in Missouri or Illinois for our electric
utility  businesses,  but we do have gas cost recovery  mechanisms in each state
for our gas utility businesses.  In addition, our electric rates in Missouri and
Illinois are largely set through 2006. Fluctuations in interest rates impact our
cost of borrowings,  and pension and post-retirement benefits. We employ various
risk  management  strategies in order to try to reduce our exposure to commodity
risks and other risks  inherent in our business.  The  reliability  of our power
plants,  and transmission and distribution  systems,  and the level of operating
and administrative costs, and capital investment are key factors that we seek to
control in order to optimize our results of operations, cash flows and financial
position.

Acquisitions

     On  January  31,  2003,  Ameren  completed  the  acquisition  of all of the
outstanding  common stock of CILCORP from AES.  CILCORP is the parent company of
Peoria,  Illinois-based  CILCO.  With the acquisition,  CILCO became an indirect
Ameren  subsidiary,  but  remains  a  separate  utility  company,  operating  as
AmerenCILCO.  On February 4, 2003,  Ameren also  completed  the  acquisition  of
Medina  Valley,  which  indirectly  owns  a  40  megawatt,   gas-fired  electric
generation  plant.  The results of operations for CILCORP and Medina Valley were
included  in  Ameren's  consolidated  financial  statements  effective  with the
respective  January and February 2003  acquisition  dates.  See Overview section
above of Ameren's  Management's  Discussion and Analysis of Financial  Condition
and Results of Operations.

     Ameren  acquired  CILCORP  to  complement  its  existing  Illinois  gas and
electric operations.  The purchase included CILCO's rate-regulated  electric and
natural gas  businesses in Illinois  serving  approximately  200,000 and 205,000
customers, respectively, of which approximately 150,000 are combination electric
and gas  customers.  CILCO's  service  territory  is  contiguous  to our service
territory.  CILCO  also  has a non  rate-regulated  electric  and gas  marketing
business  principally  focused in the Chicago,  Illinois  region.  Finally,  the
purchase included approximately 1,200 megawatts of largely coal-fired generating
capacity,  most of which  became  non  rate-regulated  on October 3, 2003 due to
CILCO's transfer of 1,100 megawatts of generating capacity to AERG. See Note 1 -
Summary of Significant  Accounting  Policies to our financial  statements  under
Item 1 of Part 1 of this report for further information on the transfer to AERG.

                                       53

<PAGE>

     The total acquisition cost was approximately  $1.4 billion and included the
assumption by Ameren of CILCORP and Medina  Valley debt and  preferred  stock at
closing of $895 million and  consideration  of $489 million in cash, net of cash
acquired.  The cash component of the purchase price came from Ameren's  issuance
in September  2002 of 8.05 million  common shares and its issuance in early 2003
of an additional 6.325 million common shares, which together generated aggregate
net proceeds of $575 million.


RESULTS OF OPERATIONS

Earnings Summary

     Ameren's net income  increased  $35 million to $275  million,  or $1.70 per
share, in the third quarter of 2003 from $240 million, or $1.64 per share ($1.63
per  share  diluted),  in the third  quarter  of 2002.  Net  income in the third
quarter of 2003 included an after-tax  gain of $31 million or 19 cents per share
related to the settlement of a dispute over mine reclamation  issues with a coal
supplier.  This gain  primarily  represented a return of coal costs plus accrued
interest  previously  paid to a coal supplier for future  reclamation  of a coal
mine that principally supplied UE's Rush Island power plant.

     Excluding  this  after-tax  gain,  Ameren's  third  quarter 2003 net income
increased $4 million to $244 million or $1.51 per share. The $4 million increase
resulted  principally  from the  acquisition of CILCORP,  favorable  interchange
margins due to improved power prices in the energy  markets and better  low-cost
generation available for sale, lower labor costs due to the voluntary retirement
program  implemented  in  early  2003  and  lower  maintenance  expenses  in our
pre-CILCORP acquisition operations.  These benefits to net income were partially
offset by cooler  summer  weather,  a rate  reduction in UE's  Missouri  service
territory that went into effect in April 2003,  higher  employee  benefit costs,
and increased shares outstanding.

     Ameren's net income  increased  $72 million to $486  million,  or $3.02 per
share for the nine months  ended  September  30, 2003  compared to the  year-ago
earnings of $414 million,  or $2.88 per share ($2.87 per share diluted).  In the
first nine months of 2003,  our net income  included the after-tax gain from the
settlement  of the coal mine  reclamation  issues of $31 million or 19 cents per
share  mentioned  above and a net  cumulative  effect  gain of $18 million or 11
cents per share associated with the adoption of SFAS 143,  "Accounting for Asset
Retirement  Obligations."  The SFAS 143 net gain resulted  principally  from the
elimination  of  non-legal  obligation  costs of removal for non  rate-regulated
assets from  accumulated  depreciation.  The  following  table  presents the net
cumulative effect gain recorded at each of the Ameren Companies upon adoption of
SFAS 143:

<TABLE>
<CAPTION>

   ===================================================================================================================
<S>                                                                                                  <C>
   Net cumulative effect after-tax gain:
   -------------------------------------------------------------------------------------------------------------------
   Ameren(a)...............................................................................           $   18
   UE......................................................................................                -
   CIPS....................................................................................                -
   Genco...................................................................................               18
   CILCORP(b)..............................................................................                4
   CILCO...................................................................................               24
   ===================================================================================================================
     (a)  Excludes  amounts  for  CILCORP  and  CILCO,  which  were prior to the
          acquisition date of January 31, 2003.
     (b)  Represents predecessor information.
</TABLE>

     Excluding  the gains on the adoption of SFAS 143 and the  settlement of the
coal mine reclamation dispute,  Ameren's net income for the first nine months of
2003 was $437  million or $2.72 per share.  In addition  to the items  discussed
above,  net income for the first nine  months of 2003  benefited  as compared to
from net increase in Other Income and Deductions as a result of the expensing of
economic  development  and energy  assistance  programs in the second quarter of
2002 related to the UE Missouri electric rate case settlement in 2002, partially
offset by higher depreciation costs and lower sales of emission credits.


     The impact  from the  acquisition  of  CILCORP,  Medina  Valley and related
financings  resulted in a reduction to Ameren's  earnings per share in the first
nine months of 2003 of  approximately  3 cents per share,  but was  accretive by
approximately  2 cents per share in the third  quarter of 2003.  Ameren  expects
that the  operations  of CILCORP will be

                                       54
<PAGE>


accretive to earnings in the first full year following the  acquisition  date as
Ameren  realizes  synergies  associated  with  this  acquisition  following  the
integration of systems and operating practices in August and October of 2003.

     The amortization of non-cash purchase  accounting fair value adjustments at
CILCORP  increased  Ameren's and CILCORP's net income by $3 million in the third
quarter  and $7 million  for the eight  months  ended  September  30,  2003,  as
compared  to the same prior year  periods.  The  amortization  of the fair value
adjustments  that  increased  net income were  related  primarily to pension and
post-retirement  liabilities,  coal contract liabilities,  severance liabilities
and long-term debt. The  amortization of fair value  adjustments  that decreased
net income were related primarily to electric plant in service,  purchased power
and emission  credits.  The following  table presents the impact on Ameren's net
income of the amortization of these purchase  accounting fair value  adjustments
during 2003:

<TABLE>
<CAPTION>

   ===================================================================================================================
   For the periods ended September 30, 2003                           Three Months                Eight Months
   -------------------------------------------------------------------------------------------------------------------
<S>                                                                     <C>                       <C>
   Statement of Income line item:
     Other operations and maintenance........................              $    5                   $    15
     Interest................................................                   2                         5
     Fuel and purchased power................................                   -                        (2)
     Depreciation and amortization...........................                  (2)                       (6)
     Income taxes............................................                  (2)                       (5)
   -------------------------------------------------------------------------------------------------------------------
   Impact on net income....................................                $    3                   $     7
   ===================================================================================================================
</TABLE>

     As a holding  company,  Ameren's  net income  and cash flows are  primarily
generated  by its  principal  subsidiaries,  UE,  CIPS,  Genco  and  CILCORP.  A
discussion  of the results of  operations  of these  principal  subsidiaries  is
included in this  document.  The following  table presents the  contribution  by
Ameren's  principal  subsidiaries  to Ameren's  consolidated  net income for the
three and nine months ended September 30, 2003 and 2002:

<TABLE>
<CAPTION>

   ===================================================================================================================
                                                                  Three Months                   Nine Months
   -------------------------------------------------------------------------------------------------------------------
<S>                                                        <C>             <C>          <C>              <C>
                                                               2003           2002          2003            2002
                                                               ----           ----          ----            ----
   Net Income
     UE(a)..........................................       $   224        $   204       $   396          $  358
     CIPS...........................................            25             23            29              31
     Genco(a).......................................            17             15            65              31
     CILCORP(b).....................................            11              -            14               -
     Other(c).......................................            (2)            (2)          (18)             (6)
   -------------------------------------------------------------------------------------------------------------------
   Ameren net income...............................        $   275        $   240       $   486          $  414
   ===================================================================================================================
     (a)  Includes  earnings  from  interchange  sales  by  Ameren  Energy  that
          provided  approximately $18 million and $73 million of UE's net income
          in the three and nine months  ended  September  30, 2003 (2002 - third
          quarter - $9 million; year-to-date - $25 million) and approximately $9
          million  and $37  million of Genco's  net income in the three and nine
          months ended  September  30, 2003 (2002 - third  quarter - $5 million;
          year-to-date - $12 million).
     (b)  The  nine  month  period  of  2003  excludes   amounts  prior  to  the
          acquisition date of January 31, 2003.
     (c)  Includes  corporate general and  administrative  expenses,  transition
          costs associated with the CILCORP acquisition,  stock compensation and
          other unregulated operations.

</TABLE>
                                       55

<PAGE>

Electric Operations

     The  following  tables  present the favorable  (unfavorable)  variations in
electric  margins,  defined as electric  revenues less fuel and purchased power,
for the three and nine  months  ended  September  30,  2003 from the  comparable
periods in 2002. We believe  margin is a useful measure to analyze the change in
profitability  of our electric  operations  between  periods.  The variation for
Ameren  reflects the entire  contribution  from CILCORP as a separate line item.
The variations in CILCORP and CILCO electric  margins are for the three and nine
months  ended  September  30, 2003 as compared to the same  periods in 2002 when
Ameren  did not own these  companies, and they did not  contribute  to  Ameren's
electric margins.

<TABLE>
<CAPTION>

   ===================================================================================================================
   Three months                                Ameren(a)      UE       CIPS      Genco       CILCORP(b)       CILCO
   -------------------------------------------------------------------------------------------------------------------
<S>                                           <C>         <C>        <C>       <C>          <C>             <C>
   Electric revenue change:
      CILCORP acquisition..................    $  168      $   -      $   -     $   -         $   -           $    -
      Interchange revenues.................        15         13          -         7             4                4
      Effect of weather (estimate).........       (77)       (62)        (9)        -            (4)              (4)
      Rate reductions......................       (11)       (11)         -         -             -                -
      Growth and other (estimate)..........        33         20        (24)        2             1                1
      EEI..................................         3          -          -         -             -                -
   -------------------------------------------------------------------------------------------------------------------
   Total ..................................    $  131      $ (40)     $ (33)    $   9         $   1           $    1
   -------------------------------------------------------------------------------------------------------------------

   Fuel and purchased power change:
      CILCORP acquisition..................    $  (85)     $   -      $   -     $   -         $   -           $    -
      Fuel:
        Generation and other...............         1         (8)         -         8             1                1
        Price..............................         -         (2)         -         2             -                -
      Purchased power......................         8         14         21       (11)          (16)             (16)
      EEI .................................        (6)         -          -         -             -                -
   -------------------------------------------------------------------------------------------------------------------
   Total ..................................    $  (82)     $   4      $  21     $  (1)        $ (15)          $  (15)
   -------------------------------------------------------------------------------------------------------------------
   Net change in electric margins..........    $   49      $ (36)     $ (12)    $   8         $ (14)          $  (14)
   ===================================================================================================================

   ===================================================================================================================
   Nine months                                Ameren(a)       UE       CIPS      Genco      CILCORP(b)        CILCO
   -------------------------------------------------------------------------------------------------------------------
   Electric revenue change:
      CILCORP acquisition..................    $  373      $   -      $   -     $   -         $   -           $    -
      Interchange revenues.................        52         40          -        30             8                8
      Effect of weather (estimate).........      (111)       (91)       (13)        -            (8)              (8)
      Rate reductions......................       (27)       (27)         -         -             -                -
      Growth and other (estimate)..........        36         21        (62)        4            24               24
      EEI..................................       (45)         -          -         -             -                -
   -------------------------------------------------------------------------------------------------------------------
   Total ..................................    $  278      $ (57)     $ (75)    $  34         $  24           $   24
   -------------------------------------------------------------------------------------------------------------------

   Fuel and purchased power change:
      CILCORP acquisition..................    $ (192)     $   -      $   -      $  -         $   -            $   -
      Fuel:
        Generation and other...............        (7)       (30)         -        21             -               (1)
        Price..............................         1         (5)         -         6             1                1
      Purchased power......................        58         50         59       (31)          (37)             (34)
      EEI..................................         2          -          -         -             -                -
   -------------------------------------------------------------------------------------------------------------------
   Total ..................................    $ (138)     $  15      $  59      $ (4)        $ (36)           $ (34)
   -------------------------------------------------------------------------------------------------------------------
   Net change in electric margins..........    $  140      $ (42)     $ (16)     $ 30         $ (12)           $ (10)
   ===================================================================================================================
     (a)  Includes  amounts for  non-registrant  Ameren  subsidiaries as well as
          intercompany eliminations.
     (b)  Includes  predecessor  information  for  periods  prior to January 31,
          2003. CILCORP  consolidates CILCO and therefore includes CILCO amounts
          in its balances.
</TABLE>
                                       56

<PAGE>

Ameren

     Ameren's  electric  margin  increased  $49 million for the three months and
$140 million for the nine months ended September 30, 2003,  compared to the same
periods in 2002. Increases in electric margin were primarily attributable to the
acquisition of CILCORP, organic sales growth, and increased interchange margins,
partially offset by unfavorable weather conditions  relative to 2002.  CILCORP's
electric  margin for the three and eight months ended September 30, 2003 was $83
million and $181 million,  respectively.  Interchange  margins  increased (third
quarter - $13 million;  year-to-date - $73 million) due to improved power prices
in the energy  markets  and better  low-cost  generation  availability.  Average
realized power prices on interchange sales increased from  approximately $25 per
megawatt-hour  in the  first  nine  months  of  2002  (third  quarter  - $27) to
approximately  $33 per  megawatt-hour  in the first nine  months of 2003  (third
quarter - $29).

     The  unfavorable  weather  conditions  were  primarily due to cooler summer
weather in the second and third  quarters  of 2003 versus  slightly  warmer than
normal  conditions  in the  same  periods  in 2002.  Cooling  degree  days  were
approximately  17% less in the third  quarter of 2003 in our  service  territory
compared to the prior year  period,  but  comparable  to normal  conditions.  In
Ameren's   pre-CILCORP   acquisition   service   territory,    weather-sensitive
residential and commercial electric  kilowatt-hour sales both declined 7% in the
third  quarter of 2003  compared to the third  quarter of 2002  (year-to-date  -
decreased 3% and 4%,  respectively).  However,  colder winter weather  benefited
electric  margins  in the first  quarter  of 2003,  reducing  the net  impact of
weather in the first nine months of 2003 as compared to the same period in 2002.

     Annual rate  reductions of $50 million and $30 million were effective April
1, 2002 and 2003,  respectively,  as a result of the 2002 UE electric  rate case
settlement in Missouri,  and negatively  impacted electric revenues in the first
nine  months of 2003.  Revenues  will be  further  reduced  at UE by the 2002 UE
settlement of the Missouri  electric rate case, due to an additional $30 million
of annual electric rate reduction effective April 1, 2004.

     The  growth  and other line item in the table  above  includes  the sale of
emission credits at UE. The sales of emission credits at UE increased $4 million
in the third quarter of 2003,  but decreased $4 million in the first nine months
of 2003  compared  to the same  periods  in  2002,  respectively.  In  addition,
industrial electric  kilowatt-hour sales increased  approximately 1% in both the
third quarter and first nine months of 2003 in Ameren's pre-CILCORP  acquisition
service territory.

     EEI's  revenues  decreased in the first nine months of 2003 compared to the
prior  period due to lower  emission  credit  sales and  decreased  sales to its
principal  customer,  which also  resulted in a decrease  in fuel and  purchased
power. EEI's sales of emission credits were $10 million in the first nine months
of 2003 (2002 - $38 million).

     Ameren's fuel and purchased power increased in the third quarter and first
nine months of 2003 compared to the same prior year periods due to increased
kilowatt-hour sales related primarily to the addition of CILCORP. Excluding
CILCORP, fuel and purchased power decreased in the third quarter and first nine
months of 2003 primarily due to greater availability of low-cost generation.

     During 2002, we adopted the  provisions of EITF 02-3,  "Issues  Involved in
Accounting  for  Derivative  Contracts  Held for Trading  Purposes and Contracts
Involved  in Energy  Trading  and Risk  Management  Activities,"  that  required
revenues and costs associated with certain energy contracts to be shown on a net
basis in the  Statement  of  Income.  See also Note 1 - Summary  of  Significant
Accounting  Policies to our financial  statements under Item 1 of Part I of this
report for further information on the impact of netting these operating revenues
and costs.

UE

     UE's  electric  margin  decreased  $36 million for the three months and $42
million  for the nine  months  ended  September  30,  2003  compared to the same
periods in 2002. Decreases in electric margin were primarily attributable to the
unfavorable  weather  conditions  as  mentioned  above  and the rate  reductions
resulting  from  the 2002  Missouri  electric  rate  case  settlement.  However,
interchange  margins  increased (third quarter - $9 million;  year-to-date - $48
million) due to improved power prices in the energy markets and better  low-cost
generation  availability.  Fuel and purchased  power decreased $4 million in the
third  quarter  and $15  million in the first nine months of 2003 due to greater
availability of low-cost generation.

                                       57

<PAGE>

CIPS

     CIPS'  electric  margin  decreased $12 million for the three months and $16
million  for the nine  months  ended  September  30,  2003  compared to the same
periods in 2002.  Decreases in electric  margin were primarily  attributable  to
unfavorable   weather  conditions  as  mentioned  above  and  several  customers
switching from CIPS to Marketing Company.

     Commencing in 2002,  all of CIPS',  CILCO's and UE's Illinois  residential,
commercial  and  industrial  customers  had a choice in  electric  suppliers  as
provided by the Electric  Service  Customer  Choice and Rate Relief Law of 1997.
Several CIPS' commercial and industrial  customers switched to Marketing Company
for their energy supply resulting in a decline in CIPS' revenues included in the
growth and other line item in the table above and a decrease in purchased  power
of  approximately  $25 million for the three months ended September 30, 2003 and
$67 million for the nine months  ended  September  30, 2003.  CIPS  continues to
provide   electric   delivery  service  to  these  customers  and  charges  them
ICC-approved delivery service tariff rates for that service.  There was no other
significant switching of customers among or outside of the Ameren Companies.

Genco

     Genco's  electric margin  increased $8 million for the three months and $30
million for the nine  months  ended  September  30,  2003,  compared to the same
periods in 2002.  Increases in electric  margin were primarily  attributable  to
increased  interchange margins.  Interchange margins increased  approximately $4
million in the third  quarter  and  approximately  $25 million in the first nine
months of 2003 due to  improved  power  prices in the energy  markets.  Fuel and
purchased  power  increased  $4 million in the first nine  months of 2003 due to
higher  purchased  power costs  associated  with higher  energy prices and lower
generation.  These  increased  costs were partially  offset by lower  generation
costs  due  to a  14%  decline  in  megawatt-hour  generation.  The  decline  in
generation was primarily  attributable to the timing of outages at Genco's power
plants during the first nine months of 2003.

CILCORP

     CILCORP's  electric  margin  decreased $14 million for the three months and
$12 million for the nine months ended  September  30, 2003  compared to the same
periods in 2002.  Decreases in electric  margin were primarily  attributable  to
unfavorable  weather  conditions,  lower  margin per  megawatt-hour  sold to non
rate-regulated  electric  customers outside of CILCO's service territory and the
transfer of one large CILCO customer to Marketing Company. In addition, fuel and
purchased power increased due to the effect of positive purchase accounting fair
value adjustments related to emission  allowances,  partially offset by negative
adjustments to coal contracts.

CILCO

     CILCO's  electric margin decreased $14 million for the three months and $10
million  for the nine  months  ended  September  30,  2003  compared to the same
periods in 2002.  Decreases in electric  margin were primarily  attributable  to
unfavorable  weather  conditions,  lower  margin per  megawatt-hour  sold to non
rate-regulated  electric  customers  outside CILCO's  service  territory and the
transfer of one large CILCO customer to Marketing Company.


                                       58

<PAGE>

Gas Operations

     The following table presents the favorable (unfavorable)  variations in gas
margins,  defined as gas revenues less gas  purchased for resale,  for the three
and nine months ended September 30, 2003 from the comparable  period in 2002. We
believe margin is a useful measure to analyze the change in profitability of gas
operations between periods.

<TABLE>
<CAPTION>

   ===================================================================================================================
                                                              Three Months                      Nine Months
   -------------------------------------------------------------------------------------------------------------------
<S>                                                            <C>                              <C>
   Ameren(a)......................................              $     15                         $    51
   UE.............................................                     -                               7
   CIPS...........................................                     2                               3
   Genco..........................................                     -                               -
   CILCORP(b).....................................                     1                               4
   CILCO..........................................                     1                               6
   ===================================================================================================================
     (a)  Excludes  amounts for CILCORP and CILCO prior to the acquisition  date
          of January 31, 2003 and  includes  amounts for  non-registrant  Ameren
          subsidiaries as well as intercompany eliminations.
     (b)  Includes  predecessor  information  for  periods  prior to January 31,
          2003.

  </TABLE>

     Ameren's gas margin increased in the third quarter and first nine months of
2003  primarily due to the  acquisition of CILCORP (third quarter - $14 million;
eight months ended September 30, 2003 - $49 million). UE's, CIPS', CILCORP's and
CILCO's gas margins  were  comparable  in the third  quarter of 2003 to the same
period in 2002, but increased in the first nine months of 2003,  compared to the
same period in 2002,  primarily due to increased  customer demand resulting from
colder winter weather in the first quarter of 2003.

Operating Expenses and Other Statement of Income Items

     The  following  tables  present the favorable  (unfavorable)  variations in
operating and other  expenses for the three and nine months ended  September 30,
2003 from the comparable period in 2002:

<TABLE>
<CAPTION>

   ===================================================================================================================
   Three months                                 Ameren(a)       UE     CIPS      Genco      CILCORP(b)       CILCO
   -------------------------------------------------------------------------------------------------------------------
<S>                                            <C>          <C>      <C>       <C>          <C>           <C>
      Other operations and maintenance.......    $   (24)     $   9    $ (2)    $   -        $   (8)       $  (13)
      Coal contract settlement...............         51         51       -         -             -             -
      Depreciation and amortization..........        (24)        (1)      -        (2)            -             2
      Taxes other than income taxes..........         (9)         6       -        (3)            1             1
      Other income and deductions............         (2)         2      (1)        1            (2)           (2)
      Interest expense.......................        (13)         3       3        (2)            1             3
      Income taxes...........................         (9)       (15)     12        (1)            8             8
   ===================================================================================================================

   ===================================================================================================================
   Nine months                                  Ameren(a)       UE     CIPS      Genco      CILCORP(b)       CILCO
   -------------------------------------------------------------------------------------------------------------------
      Other operations and maintenance.......    $   (66)     $  28    $ (1)    $  14        $   (8)       $  (23)
      Coal contract settlement...............         51         51       -         -             -             -
      Depreciation and amortization..........        (67)        (1)     (1)       (6)           (6)            -
      Taxes other than income taxes..........        (27)         6      (1)       (4)            1             1
      Other income and deductions............         32         14      (5)        3            (3)           (2)
      Interest expense.......................        (46)         4       5       (13)            8             3
      Income taxes...........................        (17)       (31)     13       (10)            6             9
   ===================================================================================================================
     (a)  Excludes  amounts for CILCORP and CILCO prior to the acquisition  date
          of January 31, 2003. Includes amounts for other non-registrant  Ameren
          subsidiaries as well as intercompany eliminations.
     (b)  Includes  predecessor  information  for  periods  prior to January 31,
          2003.
</TABLE>

                                       59

<PAGE>

Other Operations and Maintenance

     Ameren

     Ameren's other operations and maintenance  expenses  increased in the third
quarter  and first  nine  months of 2003  compared  to the same  periods in 2002
primarily  due to the addition of CILCORP  (third  quarter - $38 million;  eight
months ended  September  30, 2003 - $95  million),  CILCORP's  transition  costs
related to the acquisition in January 2003,  higher employee benefit costs and a
net increase in injuries and damages reserves based on claims experience.  These
increases in other operations and maintenance  expenses were partially offset by
lower  labor  costs  related  to  the  voluntary  employee   retirement  program
implemented in early 2003 and lower plant maintenance costs primarily due to the
number and timing of outages.

     UE

     UE's other  operations  and  maintenance  expenses  decreased  in the third
quarter  and first  nine  months of 2003  compared  to the same  periods in 2002
primarily due to the lower labor and plant maintenance costs as mentioned above,
partially  offset by the higher  employee  benefit costs and the net increase in
injuries and damages reserves as mentioned above.

     CIPS

     CIPS' other  operations  and  maintenance  expenses  increased in the third
quarter and first nine months of 2003 to the same periods in 2002  primarily due
to the net increase in injuries and damages reserves and higher employee benefit
costs,  partially offset by lower labor costs related to the voluntary  employee
retirement program implemented in early 2003.

     Genco

     Genco's other  operations and  maintenance  expenses were comparable in the
third quarter of 2003 to the same period in 2002.

     Genco's other  operations and maintenance  expenses  decreased in the first
nine  months of 2003  compared  to the same  period in 2002  primarily  due to a
reduction in consulting costs at its coal-fired  generation stations, a decrease
in commitment fees for the use of UE's and CIPS'  transmission  lines, and a net
decrease in injuries and damages  reserves,  partially offset by higher employee
benefit costs.

     CILCORP

     CILCORP's other operations and maintenance  expenses increased in the third
quarter  and first  nine  months  of 2003  compared  to the same  period in 2002
primarily due to higher employee  benefit,  severance and other costs associated
with the  integration of operations as a result of the  acquisition by Ameren on
January 31, 2003.  These increases were partially  offset by the amortization of
purchase accounting fair value adjustments for pension and severance costs.

     CILCO

     CILCO's other  operations and maintenance  expenses  increased in the third
quarter  and first  nine  months  of 2003  compared  to the same  period in 2002
primarily due to higher employee  benefit,  severance and other costs associated
with the integration of operations as a result of the acquisition on January 31,
2003.

Coal Contract Settlement

     Ameren and UE recorded a coal  contract  settlement  gain of $51 million in
the third  quarter of 2003.  This gain  primarily  represented  a return of coal
costs plus accrued interest  accumulated by a coal supplier for reclamation of a
coal mine that principally  supplied UE's power plant.  This mine reclamation is
now  substantially  complete.  In August  2003,  UE  entered  into a  settlement
agreement with the coal supplier to return the  accumulated  reclamation  funds,
which will be paid to UE ratably through December 2004.

                                       60

<PAGE>

Depreciation and Amortization

     Depreciation and amortization expenses increased at Ameren and Genco in the
third  quarter and first nine months of 2003 as compared to the same  periods in
2002.  The increase at Ameren and Genco was primarily  due to the  completion of
four  combustion  turbine  generating  units at Genco in the  third  and  fourth
quarters of 2002. In addition,  Ameren's  depreciation and amortization expenses
increased  due to the inclusion of CILCORP  operations in 2003 (third  quarter -
$18 million; eight months ended September 30, 2003 - $54 million).

     Depreciation and amortization expenses increased at UE in the third quarter
and first  nine  months of 2003 to the same  periods  in 2002  primarily  due to
capital  additions  in 2002,  partially  offset by a reduction  in  depreciation
rates.  The decrease in depreciation  rates was based on the updated analysis of
asset  values,  service  lives and  accumulated  depreciation  levels  that were
required by UE's 2002 Missouri electric rate case settlement.

     Depreciation  and amortization  expenses  increased at CILCORP in the first
nine months of 2003 as compared to the same period in 2002  primarily due to the
effect of purchase  accounting  fair value  adjustments  that increased the fair
value of the Duck  Creek and E.D.  Edwards  power  plants  and  Sterling  Avenue
peaking  station.  The  increase  in fair  value is being  depreciated  over the
estimated remaining lives of the power plants.

     Depreciation and amortization expenses at CIPS and CILCO were comparable in
the third quarter and first nine months of 2003 to the same periods in 2002.

Taxes Other Than Income Taxes

     At Ameren, taxes other than income taxes increased in the third quarter and
first nine months of 2003 as compared to the same periods in 2002  primarily due
to the  acquisition of CILCORP  (third quarter - $9 million;  eight months ended
September 30, 2003 - $26 million).

     At UE,  taxes other than income taxes  decreased  in the third  quarter and
first  nine  months of 2003 as  compared  to the same  periods  in 2002 due to a
decrease in gross  receipts  taxes related to lower native sales  resulting from
milder weather.

     At CIPS,  taxes other than income taxes was comparable in the third quarter
of 2003 to the same period in 2002,  but  increased  in the first nine months of
2003 as  compared to the same  period in 2002 due to tax  refunds  that  lowered
expense in 2002.

     At Genco,  taxes other than income taxes increased in the third quarter and
first nine months of 2003 as compared to the same periods in 2002  primarily due
to adjustments  related to property tax assessments and increased property taxes
associated with the four combustion  turbine generating units added in the third
and fourth quarters of 2002.

     CILCORP's and CILCO's taxes other than income taxes were  comparable in the
third quarter and first nine months of 2003 to the same periods in 2002.

Other Income and Deductions

     Other  income and  deductions  increased at Ameren and UE in the first nine
months  of 2003 as  compared  to the same  period in 2002  primarily  due to the
expensing of economic development and energy assistance programs required in the
UE Missouri electric rate case settlement in 2002 ($26 million).  Ameren's other
income and deductions  also increased in 2003 due to an increase in the minority
interest  related to EEI's higher  earnings in 2002.  The increase in UE's other
income and  deductions  was partially  offset by a net decrease in earnings from
UE's ownership interest in EEI and decreased gains on derivative contracts.

     CIPS other income and  deductions  decreased  in the third  quarter and the
first nine months of 2003 compared to the same periods in 2002, primarily due to
a decline in  intercompany  interest  CIPS  received  on the Genco  subordinated
promissory note due to a lower outstanding principal balance. In addition, CIPS'
other income and deductions  decreased in the first nine months of 2003 compared
to the same  period  in  2002,  due to a  decrease  in  contributions  in aid of
construction.

                                       61

<PAGE>

     Genco,  CILCORP and CILCO's other income and deductions  were comparable in
the third quarter and first nine months of 2003 to the same periods in 2002.

Interest

     Interest  expense  increased at Ameren in the third  quarter and first nine
months  of 2003,  compared  to the same  periods  in 2002  primarily  due to the
assumption  of CILCORP  debt (third  quarter - $15  million;  eight months ended
September 30, 2003 - $35 million).  In addition,  interest expense was higher in
2003 due to Genco's issuance of $275 million of 7.95% notes in June 2002 and the
interest  expense  component  associated  with the $345  million  of  adjustable
conversion rate equity security units issued by Ameren in March 2002,  partially
offset by lower interest rates at UE.

     Interest expense decreased at UE in the third quarter and first nine months
of 2003  compared to the same  period in 2002  primarily  due to lower  interest
rates on new issuances of first mortgage bonds as compared to those redeemed.

     Interest  expense  decreased at CIPS in the third  quarter and in the first
nine months of 2003  compared to the same periods in 2002  primarily  due to the
redemption  of first  mortgage  bonds in the  third  quarter  of 2002 and in the
second quarter of 2003.

     Interest  expense  increased  at  Genco  in the  third  quarter  of 2003 as
compared to the same period in 2002 primarily due to increased  borrowings  from
Ameren's  non-state  regulated  subsidiary  money  pool,  partially  offset by a
reduction in the principal  amounts  outstanding  on  subordinated  intercompany
promissory  notes to CIPS and Ameren in May 2003. In addition,  Genco's interest
expense  increased in the first nine months of 2003  compared to the same period
in 2002  primarily  due to the issuance of $275 million of 7.95% Senior Notes in
June 2002.

     Interest  expense  decreased at CILCORP and CILCO in the third  quarter and
first nine months of 2003 as compared to the same periods in 2002.  The decrease
was  primarily  due to the  redemption of long-term  debt,  partially  offset by
expense associated with debt redemption. In addition, interest expense decreased
due to the effect of purchase  accounting fair value adjustments made at CILCORP
based on market  rates.  The  increase  in the fair value of  long-term  debt in
purchase  accounting is being amortized as a reduction in interest  expense over
the remaining life of the debt.

Income Taxes

     Income tax expense  increased at Ameren,  UE and Genco in the third quarter
and first nine months of 2003 compared to the same periods in 2002 primarily due
to higher pre-tax income.  Income tax expense decreased at CIPS primarily due to
lower  pre-tax  income and an Illinois tax  settlement  in the third  quarter of
2003, which benefited income taxes by $7 million.  Income tax expense  decreased
at CILCORP and CILCO in the third quarter and first nine months of 2003 compared
to the same periods in 2002 primarily due to lower pre-tax income.


LIQUIDITY AND CAPITAL RESOURCES

     The  following  tables  present net cash  provided by (used in)  operating,
investing and financing  activities for the nine months ended September 30, 2003
and 2002:

<TABLE>
<CAPTION>

   ==========================================================================================================================
                           Net cash provided by       |        Net cash provided by       |         Net cash provided by
                           operating activities       |  (used in) investing activities   |   (used in) financing activities
   --------------------------------------------------------------------------------------------------------------------------
                        2003      2002      Variance  |    2003       2002    Variance    |   2003       2002       Variance
                        ----      ----      --------  |    ----       ----    --------    |   ----       ----       -------
                                                      |                                   |
  <S>                  <C>      <C>         <C>         <C>         <C>       <C>          <C>         <C>
   Ameren(a)........    $ 852    $ 733       $ 119    |  $ (938)     $ (582)    $ (356)   | $ (442)     $ 411     $ (853)
   UE...............      486      559         (73)   |    (308)       (291)       (17)   |   (172)      (270)        98
   CIPS.............      102       71          31    |      26           2         24    |   (128)       (83)       (45)
   Genco............      125      150         (25)   |     (39)       (300)       261    |    (87)       151       (238)
   CILCORP(b).......       75       96         (21)   |     (64)        (93)        29    |    (34)        36        (70)
   CILCO............      100       97           3    |     (67)        (95)        28    |    (52)        26        (78)
   ==========================================================================================================================
     (a)  Excludes  amounts for CILCORP and CILCO prior to the acquisition  date
          of January 31, 2003 and  includes  amounts for  non-registrant  Ameren
          subsidiaries as well as intercompany eliminations.

                                       62

<PAGE>

     (b)  2002 amounts represent predecessor  information.  2003 amounts include
          January 2003 predecessor  information.  CILCORP consolidates CILCO and
          therefore includes CILCO amounts in its balances.
</TABLE>

Operating

     Cash flows provided by operating  activities increased for Ameren, CIPS and
CILCO  and  decreased  for UE,  Genco  and  CILCORP  for the nine  months  ended
September 30, 2003 as compared to the same period in 2002.  Cash flows  provided
by operating activities increased for Ameren for the nine months ended September
30, 2003 compared to the same period in 2002  primarily as a result of increased
net earnings  discussed above. Cash flows provided by operating  activities were
reduced by two  non-cash  components  of net earnings  associated  with the gain
related to the adoption of SFAS 143 and the $51 million  pre-tax gain related to
the settlement of the coal mine reclamation issues, of which only $6 million was
received in cash during the third quarter of 2003.

     Cash flows from  operating  activities in the first nine months of 2003 for
Ameren also  benefited  as  compared to the same period in 2002 from  changes in
working capital  requirements and other non-cash accruals.  Accounts  receivable
were lower in the current  year period due to milder  weather  late in the third
quarter of 2003 as compared to 2002. In addition,  cash earnings were  favorably
impacted in the first nine months of 2003 by higher  non-cash  employee  benefit
accruals  and the time of  accounts  payable  as  compared  to  2002.  Partially
offsetting these benefits to cash flows from operating activities were increased
materials and supplies inventories  resulting from increased natural gas volumes
being put into storage during the summer  injection  period,  principally due to
the acquisition of CILCORP, and higher gas prices. Taxes also reduced cash flows
from operating  activities in the first nine months of 2003 compared to the same
period in 2002 primarily due to the timing of payments.

     In addition to the items listed above, cash flows from operating activities
increased for CIPS and CILCO  primarily  due to  reductions  in working  capital
requirements.  Cash provided by operating activities decreased for UE, Genco and
CILCORP in the first nine  months of 2003  primarily  due to  increased  working
capital  requirements and timing  differences.  UE's decrease in cash flows from
operating  activities was attributable to lower electric margins,  increased tax
payments and gas inventory  increases,  partially offset by lower operations and
maintenance expenses.


Pension Funding

     A minimum  pension  liability  was  recorded  at  December  31,  2002 which
resulted in a charge to Accumulated OCI and a reduction in stockholders' equity.
The minimum  pension  liability  has not changed as of September  30, 2003.  The
following table presents the minimum pension liability amounts,  after taxes, as
of September 30, 2003:

<TABLE>
<CAPTION>

   ==========================================================================================================================
                                                                                         September 30, 2003
   --------------------------------------------------------------------------------------------------------------------------
<S>                                                                                           <C>
   Ameren(a)................................................................                   $  102
   UE.......................................................................                       62
   CIPS.....................................................................                       13
   Genco....................................................................                        6
   CILCORP(b)...............................................................                       61
   CILCO....................................................................                       30
   ==========================================================================================================================
     (a)  Excludes  amounts  for  CILCORP  and  CILCO,  which  were prior to the
          acquisition date of January 31, 2003.
     (b)  Represents predecessor information.

</TABLE>

     We made  voluntary cash  contributions  totaling $25 million to our defined
benefit  retirement  plan during the third quarter and for the first nine months
of 2003. Based on the performance of plan assets through  September 30, 2003, we
expect to be  required  under  ERISA to fund an  average of  approximately  $150
million to $175  million  annually  in 2005,  2006 and 2007 in order to maintain
minimum funding levels for our pension plan. We expect UE's, CIPS',  Genco's and
CILCO's portion of these funding  requirements to be approximately  50%, 9%, 7%,
and 12%,  respectively.  These  amounts are  estimates  and may change  based on
actual stock market  performance,  changes in interest rates, and any changes in
government regulations.



                                       63
<PAGE>

Investing

     Cash flows used in  investing  activities  increased  for Ameren and UE and
decreased for Genco,  CILCORP and CILCO for the nine months ended  September 30,
2003,  as compared to the first nine months of 2002.  Cash provided by investing
activities  increased for CIPS over that same period.  The increase in cash used
in  investing  activities  for Ameren over the prior year  period was  primarily
related to $489 million in cash paid for the  acquisitions of CILCORP and Medina
Valley in early 2003 along with CILCORP construction expenditures of $52 million
incurred  in 2003 with no such  expenditures  in the  pre-acquisition  period of
2002,  partially  offset by lower  construction  expenditures at companies other
than CILCORP and lower nuclear fuel  expenditures  in 2003.  The increase for UE
over the prior year  period  was  primarily  related to the 2002  receipt of $84
million UE had  invested in the utility  money pool,  partially  offset by lower
construction  and nuclear fuel  expenditures in 2003. The decrease in cash flows
used in investing  activities from the prior year period for Genco was primarily
related to lower  construction  expenditures as Genco completed  construction in
2002  of  combustion   turbine   generating  units.  In  addition,   Genco  paid
approximately  $140 million in the first quarter of 2002 to Development  Company
for a combustion  turbine  generating unit  purchased,  but not yet paid for, at
December  31,  2001.  The  decrease for CILCORP and CILCO for the nine months of
2003 compared to the same period in 2002 was primarily due to lower construction
expenditures   related  to  the  completed   installation  of  pollution-control
equipment.  The increase in cash provided by investing  activities  for CIPS was
primarily due to principal payments received on its intercompany note receivable
from Genco.

     The following table presents  expected capital  expenditures for the entire
year in 2003:

<TABLE>
<CAPTION>
   ==========================================================================================================================
<S>                                            <C>          <C>       <C>        <C>         <C>            <C>
                                                Ameren(a)      UE      CIPS       Genco       CILCORP        CILCO
   --------------------------------------------------------------------------------------------------------------------------
   2003 capital expenditures forecast.......      $ 675      $ 485     $ 55       $ 50         $ 100         $ 100
   ==========================================================================================================================
    (a)  Excludes $15 million  forecasted for  predecessor  CILCORP for January
         2003 prior to the acquisition by Ameren.
</TABLE>

     We  continually  review our  generation  portfolio and expected power needs
and, as a result, we could modify our plan for generation capacity,  which could
include the timing of when  certain  assets will be added to or removed from our
portfolio,  the type of generation  asset  technology that will be employed,  or
whether capacity may be purchased,  among other things.  Any changes that we may
plan to make for future  generating  needs could result in  significant  capital
expenditures or losses being incurred, which could be material.

Financing

     Cash flows used in financing  activities increased for Ameren, CIPS, Genco,
CILCORP and CILCO for the nine months ended  September  30, 2003, as compared to
the first  nine  months  of 2002 and  decreased  for UE over  that same  period.
Ameren's  principal  financing  activities  for the  first  nine  months of 2003
included the redemption of short-term and long-term  debt, as well as payment of
dividends,  partially offset by the issuance of long-term debt and common stock.
In  addition,  cash flows  provided by financing  activities  for the first nine
months of 2002 included Ameren's issuances of adjustable  conversion rate equity
security units. The increase in cash flows used in financing activities for CIPS
for the nine  months  ended  2003  compared  to the same  period in 2002 was due
primarily to the redemption of long-term  debt,  partially  offset by borrowings
made from the money pool by CIPS in 2003.  Genco's  decrease  in cash flows from
financing  activities  was due  primarily  to the  issuance  of $275  million in
long-term  debt in 2002 with no  financings  in 2003 and an  increase  in common
dividend payments,  offset by redemptions of short-term borrowings from Ameren's
non-state regulated  subsidiary money pool. CILCORP and CILCO's decrease in cash
flows from financing  activities for the first nine months of 2003,  compared to
the same period in 2002,  were  primarily due to the issuance of $100 million in
long-term  debt in 2002 with no financings  in 2003,  increased  redemptions  of
long-term debt in 2003 and an increase in common  dividend  payments,  partially
offset by borrowings from the money pool in 2003.

     Ameren  and UE are  authorized  by the  SEC  under  PUHCA  to have up to an
aggregate of $1.5 billion and $1 billion,  respectively, of short-term unsecured
debt instruments  outstanding at any time. In addition,  CIPS, AERG, CILCORP and
CILCO have PUHCA  authority  to have up to an  aggregate of $250 million each of
short-term  unsecured  debt  instruments  outstanding  at  any  time.  Genco  is
authorized by the FERC to have up to $300 million of short-term debt outstanding
at any time.

                                       64

<PAGE>

Short-Term Debt and Liquidity

     Short-term  debt  typically   consists  of  commercial   paper   borrowings
(maturities  generally  within 1 to 45 days).  The following  table presents the
Ameren Companies' and EEI's committed credit facilities at September 30, 2003:

<TABLE>
<CAPTION>

   ==========================================================================================================================
           Credit Facility                Expiration           Outstanding and Committed         Amount Available
   --------------------------------------------------------------------------------------------------------------------------
<S>                                        <C>                        <C>                           <C>
   Ameren:
       364-day revolving.........           July 2004                    $ 235                        $ 235
       Multi-year revolving......           July 2005                      130                          130
       Multi-year revolving......           July 2006                      235                          235
   UE:
       Various 364-day revolving        through May 2004                   157                          157
       Nuclear fuel lease(a).....         February 2004                    120                           43
   CIPS:
      Two 364-day revolving......       through May 2004                    15                           15
   Genco:
       Committed credit facilities                                         (b)                          (b)
   CILCORP:
       Committed credit facilities                                         (b)                          (b)
   CILCO:
       Three 364-day revolving...      through August 2004                  60                           60
   EEI:
       Two bank credit facilities       through June 2004                   45                           45
   --------------------------------------------------------------------------------------------------------------------------
      Total .....................                                        $ 997                        $ 920
   ==========================================================================================================================
     (a)  Provides for financing of nuclear fuel at Gateway Fuel Company.
     (b)  Credit   facilities  are  indirectly   available  through  money  pool
          arrangements.
</TABLE>

     At September  30, 2003,  committed  credit  facilities of $832 million were
available  for use by UE, CIPS,  CILCO and Ameren  Services  through our utility
money pool arrangement.  In addition, $600 million of this amount may be used by
Ameren directly and most of our non rate-regulated affiliates including, but not
limited to, Resources Company,  Genco,  Marketing Company,  AFS, AERG and Ameren
Energy through our non-state  regulated  subsidiary money pool  arrangement.  In
September 2003, CILCO received final  regulatory  approval to participate in the
utility money pool arrangement. CILCORP receives funds through direct loans from
Ameren since it is not part of the  non-state  regulated  money pool  agreement.
These  committed  credit  facilities  are used to support our  commercial  paper
programs  under which there were no amounts  outstanding  at September 30, 2003.
Access to our credit facilities for all Ameren Companies is subject to reduction
based on use by  affiliates.  In October 2003,  AERG received  final  regulatory
approval  to  participate  in our  non-state  regulated  subsidiary  money  pool
arrangement and as a lender only in our utility money pool.

     UE had average short-term borrowings of $53 million and $23 million for the
three and nine months ended  September 30, 2003,  respectively.  Peak short-term
borrowings  for UE were $228  million for both the three and nine  months  ended
September 30, 2003. UE was the only registrant with short-term borrowings during
these periods.

     We  rely on  access  to  short-term  and  long-term  capital  markets  as a
significant  source of funding for capital  requirements  not  satisfied  by our
operating  cash  flows.  Our  inability  to raise  capital on  favorable  terms,
particularly  during  times  of  uncertainty  in  the  capital  markets,   could
negatively  impact our ability to maintain or grow our businesses.  Based on our
current credit  ratings,  we believe that we will continue to have access to the
capital markets.  However,  events beyond our control may create  uncertainty in
the capital  markets such that our cost of capital would increase or our ability
to access the capital markets would be adversely affected.

Financial Agreement Provisions and Covenants

     Our  financial  agreements  include  customary  default  or  cross  default
provisions  that could impact the continued  availability of credit or result in
the acceleration of repayment.  The majority of our committed credit  facilities
require the borrower to represent in  connection  with any  borrowing  under the
facility that no material  adverse change has occurred since certain dates.  Our
financing arrangements do not contain credit rating triggers,  except for a $100
million  funded  bank

                                       65

<PAGE>

term  loan at CILCO.  At  September  30,  2003,  the  Ameren  Companies  were in
compliance with all material financial agreement provisions and covenants.

Debt Issuances and Redemptions

     The following  table presents our issuances,  redemptions and maturities of
long-term  debt for the nine  months  ended  September  30,  2003 and 2002.  For
additional  information related to the terms and uses of these issuances and the
sources  of funds  and  terms  for  redemptions,  see  Note 4 - Debt and  Equity
Financings to our financial statements under Item 1 of Part I of this report.

<TABLE>
<CAPTION>

   ==========================================================================================================================
                                                                               Month Issued,
                                                                                 Redeemed,          Nine Months
                                                                              Repurchased or   -----------------------
                                                                                  Matured         2003         2002
   --------------------------------------------------------------------------------------------------------------------------
<S>                                                                            <C>              <C>        <C>
   Issuances -
      Ameren:
        5.70% Notes, due February 1, 2007.................................       January         $   -       $  100
        Senior notes, due May 15, 2007(a).................................        March              -          345
      UE:
        5.50% Senior secured notes due March 15, 2034.....................        March            184            -
        4.75% Senior secured notes due April 1, 2015......................        April            114            -
        5.10% Senior secured notes due August 1, 2018.....................        July             200            -
        5.25% Senior secured notes due September 1, 2012..................       August              -          173
      CIPS                                                                                           -            -
      Genco:
        7.95% Senior notes due June 1, 2032...............................        June               -          275
      CILCORP                                                                                        -            -
      CILCO                                                                                          -            -
   -------------------------------------------------------------------------------------------------------------------
      Total long-term debt issuances                                                             $ 498       $  893
   -------------------------------------------------------------------------------------------------------------------
   Redemptions, Repurchases and Maturities -
      Ameren                                                                                         -            -
      UE:
        8.25% First mortgage bonds due October 15, 2022...................        April          $ 104       $    -
        8.00% First mortgage bonds due December 15, 2022..................         May              85            -
        7.65% First mortgage bonds due July 15, 2003......................        July             100            -
        7.15% First mortgage bonds due August 1, 2023.....................       August             75            -
        8.75% First mortgage bonds due December 1, 2021...................      September            -          125
      CIPS:
        6.94% Series 97-1 First mortgage bonds due March 15, 2002.........        March              -            5
        6.99% Series 97-1 First mortgage bonds due March 15, 2003.........        March              5            -
        6.375% Series Z First mortgage bonds due April 1, 2003............        April             40            -
        7.50% Series X First mortgage bonds due July 1, 2007..............        April             50            -
        6.96% Series 97-1 First mortgage bonds due September 15, 2002.....      September            -            5
        6.75% Series Y First mortgage bonds due September 15, 2002........      September            -           23
      Genco                                                                                          -            -
      CILCORP(b):                                                                                    -            -
        9.375% Senior bonds due 2029......................................      September           17            -
        8.7% Senior notes due 2009........................................      September           31            -
   ---------------------------------------------------------------------------------------------------------------------
</TABLE>

                                       66
<PAGE>

<TABLE>
<CAPTION>


   ---------------------------------------------------------------------------------------------------------------------
                                                                               Month Issued,
                                                                                 Redeemed,              Nine Months
                                                                              Repurchased or   -------------------------
                                                                                  Matured          2003        2002
   ---------------------------------------------------------------------------------------------------------------------
<S>                                                                            <C>             <C>          <C>
    CILCO:
        6.82% First mortgage bonds due February 10, 2003..................      February            25            -
        8.20% First mortgage bonds due January 15, 2022...................        April             65            -
        7.80% Two series of first mortgage bonds due February 9, 2023.....        April             10            -
        Hallock Substation Power Modules bank loan due through 2004 ......       August              3            -
        Kickapoo Substation Power Modules bank loan due through 2004 .....       August              2            -
     Medina Valley:
        Secured term loan due June 30, 2019...............................        June              36            -
   ---------------------------------------------------------------------------------------------------------------------
      Total long-term debt redemptions, repurchases and maturities........                      $  648        $ 158
  ======================================================================================================================
     (a)  Senior  notes are a component  of  adjustable  conversion-rate  equity
          security units.
     (b)  In  conjunction  with  Ameren's  acquisition  of  CILCORP,   CILCORP's
          existing  debt  was  adjusted  to fair  value.  The  repurchase  above
          includes a redemption of $13 million of the original  principal amount
          of 9.375%  senior  bonds and $27  million  of the  original  principal
          amount of 8.7% senior notes,  along with a reduction of the fair value
          write-up of $8 million in aggregate.

</TABLE>

     In  October  2003,  UE  issued,   pursuant  to  its  September  2003  shelf
registration  statement,  $200 million of 4.65% Senior Secured Notes due October
1, 2013. UE received net proceeds,  after fees, of $198 million, which were used
to repay outstanding short-term debt.

Dividends

     Ameren's  Board  of  Directors  does not set  specific  targets  or  payout
parameters when declaring common stock dividends.  However,  the Board considers
various issues including  Ameren's  historic  earnings and cash flow,  projected
earnings, cash flow and potential cash flow requirements,  dividend payout rates
at other utilities, return on investments with similar risk characteristics, and
overall business considerations. Dividends paid by Ameren to shareholders during
the first nine months of 2003 were $308 million  (2002 - $279 million) or $1.905
per share (2002 - $1.905).  On October 10,  2003,  Ameren's  Board of  Directors
declared a quarterly  common stock  dividend of 63.5 cents per share  payable on
December 31, 2003 to shareholders of record on December 10, 2003.

     Certain of our  financial  agreements  and corporate  governance  documents
contain covenants and conditions that, among other things,  provide restrictions
on the Ameren  Companies'  payment of dividends.  The Ameren parent  company has
restrictions  on  dividend  payments  if it were to  defer  contract  adjustment
payments on its equity security units. UE has restrictions on dividend  payments
if it were to extend interest  payment periods on its  subordinated  debentures.
CIPS has  provisions  restricting  dividend  payments  based on ratios of common
stock to total capitalization along with provisions related to certain operating
expenses  and  accumulations  of  earned  surplus.  Genco's  indenture  includes
restrictions  which  prohibit  making  any  dividend  payments  if debt  service
coverage ratios are below a defined  threshold.  CILCORP has restrictions in the
event  leverage  ratio and interest  coverage  ratio  thresholds are not met, if
CILCORP's senior long-term debt does not have specified  ratings as described in
its indenture. CILCO has restrictions on dividend payments relative to the ratio
of its balance of retained  earnings to the annual  dividend  requirement on its
preferred  stock and amounts to be set aside for any sinking fund  retirement of
Class A Preferred  Stock.  In  addition,  CILCO's  dividends  cannot  exceed $45
million during any given annual period.

                                       67

<PAGE>

     The  following  table  presents  dividends  paid  directly or indirectly to
Ameren by its  subsidiaries  for the nine months  ended  September  30, 2003 and
2002:

<TABLE>
<CAPTION>

   ===================================================================================================================
                                                                                       2003               2002
   -------------------------------------------------------------------------------------------------------------------
<S>                                                                                <C>                <C>
   UE........................................................................        $  224             $  224
   CIPS......................................................................            54                 47
   Genco.....................................................................            22                 12
   CILCORP (holding company only)(a).........................................           (34)                 -
   CILCO.....................................................................            44                 28
   Non-registrants...........................................................             -                  1
   -------------------------------------------------------------------------------------------------------------------
                                                                                     $  310             $  312
   ===================================================================================================================
    (a)  Indicates funds retained from CILCO dividend.
</TABLE>

Off-Balance Sheet Arrangements

     At September 30, 2003, neither Ameren, nor any of its subsidiaries, had any
off-balance  sheet financing  arrangements,  other than operating leases entered
into in the ordinary course of business.


OUTLOOK

     We expect the following industry-wide trends and company-specific issues to
impact earnings in 2004 and beyond:

o    Economic   conditions,   which  principally   impact  native  load  demand,
     particularly from our industrial customers, have been weak for the past few
     years,  but  have  recently  had some  improvement  with a 1%  increase  in
     industrial sales for the first nine months of 2003.
o    We  have  historically  achieved  weather-adjusted  growth  in  our  native
     electric  residential and commercial load of  approximately 2% per year and
     expect this trend to continue.
o    Electric rates in UE's, CIPS' and CILCO's Illinois service  territories are
     legislatively  fixed  through  January  1, 2007 and an  electric  rate case
     settlement in UE's Missouri service territory has resulted in reductions of
     $50  million  on April 1,  2002,  and $30  million on April 1, 2003 with an
     additional $30 million  reduction  required for April 1, 2004. In addition,
     electric rates in Missouri cannot change prior to July 1, 2006,  subject to
     certain exclusions outlined in UE's rate settlement.
o    Power  prices in the Midwest  impact the amount of revenues  UE,  Genco and
     AERG can  generate  by  marketing  any excess  power  into the  interchange
     markets.  Power  prices in the  Midwest  also  impact the cost of our CILCO
     power CILCO  purchases in the interchange  markets.  Long-term power prices
     continue to be generally  soft in the Midwest,  despite the fact that power
     prices in 2003 strengthened  significantly  relative to 2002 due in part to
     higher prices for natural gas.
o    Increased expenses associated with rising employee benefit costs and higher
     insurance and security costs  associated  with  additional  measures UE has
     taken,  or may  have to take,  at its  Callaway  nuclear  plant  and  other
     operating plants related to world events.
o    UE's Callaway  nuclear plant will have a refueling  outage in the spring of
     2004,  which is expected to last 40-45 days, and will increase  maintenance
     and purchased power costs,  and reduce the amount of excess power available
     for sale.  Refueling outages occur  approximately  every 18 months and have
     historically  reduced net  earnings at Ameren and UE by $15 to $20 million.
     UE's  2005  refueling  outage  is  expected  to  last  70  days  due to the
     installation of new steam generator units during the refueling.
o    UE is pursuing an annual gas rate  increase of $27 million in Missouri.  In
     October 2003,  the MoPSC staff  recommended  an annual gas rate increase of
     approximately $11 million. Settlement discussions are ongoing with hearings
     scheduled  for  January  2004 and a decision  expected  by April  2004.  In
     October 2003,  the ICC issued orders  awarding  CILCO an increase in annual
     gas rates of $9 million and  awarding  CIPS and UE  increases in annual gas
     rates of $7 million  and $2  million,  respectively.  See Note 3 - Rate and
     Regulatory  Matters to our financial  statements  under Item 1 of Part I of
     this report for additional information.
o    Upon  entering  the  Midwest  ISO,  UE  expects  to receive a refund of $13
     million  and CIPS  expects to receive a refund of $5 million  for fees paid
     originally to exit the Midwest ISO; however, Ameren, UE and CIPS will incur
     higher ongoing operation costs. See Note 3 - Rate and Regulatory Matters to
     our  financial  statements  under  Item 1 of  Part  I of  this  report  for
     additional information.


                                       68

<PAGE>

o    Integration of the CILCORP  acquisition  continues and Ameren,  CILCORP and
     CILCO expect to realize synergies associated with reduced overhead expenses
     and lower fuel costs.

     During the second and third quarters of 2003, we entered into new four-year
labor agreements with the IBEW and the IUOE representing eleven bargaining units
covering approximately 70% of Ameren's entire workforce (UE - six units covering
65%; CIPS - one unit  covering 70%;  Genco - two units  covering  70%).  The new
agreements  include  no wage  increase  for  year  one of the  agreements,  3.5%
increases for both years two and three, and increases of 3.25% for year four. In
addition, the agreements include a pension supplement,  more flexible work rules
and a change to  employee  medical  benefits  resulting  in  employees  paying a
greater portion of future benefit cost increases.

     At December  31,  2002,  we recorded a minimum  pension  liability  of $102
million,  after  taxes,  which  resulted  in a charge to  Accumulated  OCI and a
reduction in stockholders'  equity.  UE, CIPS and Genco's portion of the minimum
pension  liability  was $62  million,  $13 million  and $6  million,  after-tax,
respectively. CILCORP and CILCO have recorded a minimum pension liability of $61
million and $30 million,  respectively.  Based on changes in interest  rates, we
expect to change our actuarial  assumptions for our pension plan at December 31,
2003,  which  could  result in a  requirement  to record an  additional  minimum
pension liability.

     In the ordinary course of business,  we evaluate  strategies to enhance our
financial  position,  results of operations and liquidity.  These strategies may
include potential acquisitions,  divestitures, and opportunities to reduce costs
or  increase  revenues,  and other  strategic  initiatives  in order to increase
Ameren's  shareholder  value.  We are unable to predict which,  if any, of these
initiatives will be executed,  as well as the impact these  initiatives may have
on our future financial  position,  results of operations or liquidity,  however
the impact could be material.


REGULATORY MATTERS

     See Note 3 - Rate and Regulatory Matters to our financial  statements under
Item 1 of Part I of this report for information.


ACCOUNTING MATTERS

Critical Accounting Policies

     Preparation  of  the  financial   statements  and  related  disclosures  in
compliance  with  GAAP  requires  the   application  of  appropriate   technical
accounting rules and guidance, as well as the use of estimates.  Our application
of these policies involves  judgments  regarding many factors,  which, in and of
themselves,  could materially  impact the financial  statements and disclosures.
Refer to Management's Discussion and Analysis of Financial Condition and Results
of Operations that is incorporated by reference from Ameren's 2002 Annual Report
to  Shareholders  into Ameren's  Annual Report on Form 10-K for the period ended
December  31, 2002 and that is contained  in the other  Ameren  Companies'  2002
Annual Reports on Form 10-K for a discussion of the critical accounting policies
that we believe are most  difficult,  subjective or complex.  In the  discussion
below, we have outlined an additional  accounting  policy that has developed due
to our  acquisition of CILCORP.  A future change in the assumptions or judgments
applied in determining the following matter, among others, could have a material
impact on future financial results.


                                       69

<PAGE>

<TABLE>
<CAPTION>

   Accounting Policy                                    Uncertainties Affecting Application
   -----------------                                    -----------------------------------
   Leveraged Leases
<S>                                                     <C>
      We account for our investment in leveraged        o   Market conditions of the industry of the leased asset that
      leases in accordance with SFAS No. 13,                might affect the residual value at the end of the lease
      "Accounting for Leases."  As required by SFAS         terms. This would include: the real estate markets where
      13, we periodically review the estimated              each of the assets are located; the rail industry; the
      residual value as well as all other important         aerospace industry; and energy market.
      assumptions affecting estimated total net
      income from the leases. SFAS 13 requires the
      rate of return and total income of a lease to be
      recalculated if there is a permanent decline in
      the estimated residual value below the value
      currently used to calculate income.

</TABLE>

    Basis for Judgment
    ------------------

     We determine  whether the residual  value has been  "permanently  impaired"
     based on an internal review as well as a periodic third party review of the
     residual value.


Impact of Future Accounting Pronouncements

     See Note 1 - Summary of  Significant  Accounting  Policies to our financial
statements under Item 1 of Part I of this report for information.


                                       70

<PAGE>

ITEM 3. Quantitative and Qualitative Disclosures about Market Risk.

     Market risk  represents the risk of changes in value of a physical asset or
a financial instrument, derivative or non-derivative,  caused by fluctuations in
market  variables such as interest rates.  The following  discussion of our risk
management activities includes  "forward-looking"  statements that involve risks
and  uncertainties.  Actual results could differ materially from those projected
in the "forward-looking"  statements.  We handle market risks in accordance with
established  policies,  which  may  include  entering  into  various  derivative
transactions.  In the  normal  course of  business,  we also face risks that are
either  non-financial  or  non-quantifiable.   Such  risks  principally  include
business,  legal and operational  risks and are not represented in the following
discussion.

     Our risk management objective is to optimize our physical generating assets
within prudent risk parameters.  Our risk management  policies are set by a Risk
Management  Steering  Committee,  which  is  comprised  of  senior-level  Ameren
officers.

Interest Rate Risk

     We are exposed to market risk through changes in interest rates  associated
with:

o    long-term and short-term variable-rate debt;
o    fixed-rate debt;
o    commercial paper;
o    auction-rate long-term debt; and
o    auction-rate preferred stock.

     We manage our interest  rate  exposure by  controlling  the amount of these
instruments we hold within our total capitalization  portfolio and by monitoring
the effects of market changes in interest rates.

     The  following  table  presents the  estimated  increase  (decrease) in our
annual interest expense and net income if interest rates were to change by 1% on
debt outstanding at September 30, 2003:

<TABLE>
<CAPTION>

   ===================================================================================================================
                                                                                  Interest Expense    Net Income(a)
   -------------------------------------------------------------------------------------------------------------------
<S>                                                                                <C>                  <C>
   Ameren..............................................................              $  9                $  (5)
   UE..................................................................                 7                   (5)
   CIPS................................................................                 1                    -
   Genco...............................................................                 -                    -
   CILCORP.............................................................                 2                   (1)
   CILCO...............................................................                 2                   (1)
   ===================================================================================================================
    (a)  Calculations are based on an effective tax rate of 39%.
</TABLE>

     The model does not consider  the effects of the reduced  level of potential
overall economic activity that would exist in such an environment.  In the event
of a significant change in interest rates,  management would likely take actions
to further  mitigate  our  exposure to this  market  risk.  However,  due to the
uncertainty  of the  specific  actions  that  would be taken and their  possible
effects, the sensitivity analysis assumes no change in our financial structure.

Credit Risk

     Credit risk represents the loss that would be recognized if  counterparties
fail to perform as contracted.  NYMEX-traded  futures contracts are supported by
the financial and credit  quality of the clearing  members of the NYMEX and have
nominal credit risk. On all other transactions, we are exposed to credit risk in
the event of nonperformance by the counterparties in the transaction.

     Our  physical  and  financial   instruments  are  subject  to  credit  risk
consisting of trade  accounts  receivables  and executory  contracts with market
risk exposures.  The risk associated with trade  receivables is mitigated by the
large  number of customers in a broad range of industry  groups  comprising  our
customer base. No non-affiliated customer represents greater

                                       71

<PAGE>

than 10%, in the aggregate or per specific company, of our accounts  receivable.
Our revenues are primarily  derived from sales of electricity and natural gas to
customers in Missouri and Illinois. UE and Genco have credit exposure associated
with accounts  receivables from non-affiliated  companies for interchange sales.
At  September  30,  2003,   UE's  and  Genco's   combined   credit  exposure  to
non-investment grade counterparties related to interchange sales was $4 million,
net of  collateral.  We establish  credit  limits for these  counterparties  and
monitor the appropriateness of these limits on an ongoing basis through a credit
risk  management  program  which  involves  daily  exposure  reporting to senior
management, master trading and netting agreements, and credit support management
such as  letters  of  credit  and  parental  guarantees.  We also  analyze  each
counterparty's  financial  condition  prior to entering  into  sales,  forwards,
swaps, futures or option contracts and monitor counterparty  exposure associated
with our leveraged leases.  As of September 30, 2003, we had approximately  $166
million invested in leveraged leases, primarily at CILCORP.

Equity Price Risk

     Our costs of providing  non-contributory  defined  benefit  retirement  and
post-retirement  benefit plans are dependent  upon a number of factors,  such as
the rates of return on plan  assets,  discount  rate,  the rate of  increase  in
health care costs and  contributions  made to the plans. The market value of our
plan assets has been  affected by declines in the equity  market  since 2000 for
the pension and  post-retirement  plans.  As a result,  at December 31, 2002, we
recognized an additional minimum pension liability as prescribed by SFAS No. 87,
"Employers' Accounting for Pensions." The minimum pension liability was recorded
at  December  31,  2002  which  resulted  in a charge to  Accumulated  OCI and a
reduction in stockholders' equity. The minimum pension liability has not changed
as of September  30, 2003.  The  following  table  presents the minimum  pension
liability amounts, after taxes, as of September 30, 2003:

<TABLE>
<CAPTION>

   ===================================================================================================================
                                                                                         September 30, 2003
   -------------------------------------------------------------------------------------------------------------------
<S>                                                                                          <C>
   Ameren(a)................................................................                   $  102
   UE.......................................................................                       62
   CIPS.....................................................................                       13
   Genco....................................................................                        6
   CILCORP(b)...............................................................                       61
   CILCO....................................................................                       30
   ===================================================================================================================
     (a)  Excludes  amounts  for  CILCORP  and  CILCO,  which  were prior to the
          acquisition date of January 31, 2003.
     (b)  Represents predecessor information.

</TABLE>

     The amount of the  liability  was the result of asset  returns  experienced
through 2002,  interest rates and our contributions to the plans during 2002. In
future years, the liability recorded, the costs reflected in net income, or OCI,
or cash contributions to the plans could increase  materially without a recovery
in equity markets in excess of our assumed return on plan assets of 8.5%. If the
fair value of the plan  assets were to grow and exceed the  accumulated  benefit
obligations in the future,  then the recorded  liability  would be reduced and a
corresponding  amount of equity  would be restored in the  Consolidated  Balance
Sheet.

     UE also  maintains  trust  funds,  as required  by the  Nuclear  Regulatory
Commission  and  Missouri  and Illinois  state laws,  to fund  certain  costs of
nuclear  decommissioning.  By  maintaining a portfolio  that includes  long-term
equity  investments,  UE seeks to  maximize  the  returns to be utilized to fund
nuclear  decommissioning  costs.  However, the equity securities included in the
portfolio  are  exposed  to  price   fluctuations  in  equity  markets  and  the
fixed-rate, fixed-income securities are exposed to changes in interest rates. UE
actively   monitors  the  portfolio  by  benchmarking  the  performance  of  our
investments  against  certain  indices  and  by  maintaining,  and  periodically
reviewing, established target allocation percentages of the assets of the trusts
to various investment options.  UE's exposure to equity price market risk is, in
large part,  mitigated,  due to the fact that it is currently allowed to recover
decommissioning costs in its rates.

                                       72

<PAGE>

Fair Value of Contracts

     We utilize derivatives  principally to manage the risk of changes in market
prices  for  natural  gas,  fuel,   electricity  and  emission  credits.   Price
fluctuations in natural gas, fuel and electricity cause:

o    an unrealized  appreciation  or  depreciation  of our firm  commitments  to
     purchase or sell when  purchase or sales prices  under the firm  commitment
     are compared with current commodity prices;
o    market  values of fuel and natural gas  inventories  or purchased  power to
     differ  from  the  cost  of  those  commodities  in  inventory  under  firm
     commitment; and
o    actual cash  outlays for the purchase of these  commodities  to differ from
     anticipated cash outlays.

     The  derivatives  that we use to hedge  these  risks are  dictated  by risk
management  policies and include forward contracts,  futures contracts,  options
and swaps. We continually  assess our supply and delivery  commitment  positions
against forward market prices and internally  forecast forward prices and modify
our exposure to market,  credit and  operational  risk by entering  into various
offsetting  transactions.  In general,  we believe these  transactions  serve to
reduce our price risk.  See Note 6 -  Derivative  Financial  Instruments  to our
financial  statements  under  Item  1 of  Part  I of  this  report  for  further
information.

     The following  tables  present the favorable  (unfavorable)  changes in the
fair value of all  contracts  marked-to-market  during the three and nine months
ended September 30, 2003:

<TABLE>
<CAPTION>

   ===================================================================================================================
   Three months                                          Ameren (a)     UE       CIPS        CILCORP         CILCO
   -------------------------------------------------------------------------------------------------------------------
<S>                                                     <C>          <C>       <C>          <C>            <C>
   Fair value of contracts                                $   1       $   3     $  -         $   -         $   1
      at beginning of period, net.................
     Contracts realized or
        otherwise settled during the period.......            -           -        -             -             -
     Changes in fair values attributable
        to changes in valuation techniques
        and assumptions...........................            -           -        -             -             -
     Fair value of new contracts entered
        into during the period....................            -           -        -             -             -
     Other changes in fair value..................            3           -       (3)            -             1
   -------------------------------------------------------------------------------------------------------------------
   Fair value of contracts outstanding
      at end of period, net.......................        $   4       $   3     $ (3)        $   -         $   2
   ===================================================================================================================
      (a) Includes amounts for non-registrant Ameren subsidiaries as well as intercompany eliminations.

   ===================================================================================================================
   Nine months                                           Ameren(a)      UE       CIPS        CILCORP(b)      CILCO(b)
   -------------------------------------------------------------------------------------------------------------------
   Fair value of contracts                                $   7       $   6     $  -          $  -         $   2
      at beginning of period, net.................
     Contracts realized or
        otherwise settled during the period.......           (4)          -        -             -            (6)
     Changes in fair values attributable
        to changes in valuation techniques
        and assumptions...........................            -           -        -             -             -
     Fair value of new contracts entered
        into during the period....................            -           -        -             -             -
     Other changes in fair value..................            1          (3)      (3)            -             6
   -------------------------------------------------------------------------------------------------------------------
   Fair value of contracts outstanding
      at end of period, net.......................        $   4       $   3     $ (3)         $  -         $   2
   ===================================================================================================================
     (a)  Excludes  amounts for CILCORP and CILCO prior to the acquisition  date
          of January 31, 2003 and  includes  amounts for  non-registrant  Ameren
          subsidiaries as well as intercompany eliminations.
     (b)  Includes  January  2003  predecessor  information,  which was zero for
          CILCORP and $2 million for CILCO..

</TABLE>
                                      73

<PAGE>

     The following  table  presents  maturities of contracts as of September 30,
2003:

<TABLE>
<CAPTION>

   ===================================================================================================================
                                            Maturity                                    Maturity in
                                            less than    Maturity 1-3   Maturity 4-5    excess of 5     Total fair
           Sources of fair value             1 year          years          years          years         value(a)
   ------------------------------------------------------------------------------------------------------------------
<S>                                         <C>            <C>            <C>            <C>             <C>
   Ameren
   Prices actively quoted.............       $   4          $    -         $   -          $   -            $   4
   Prices  provided  by  other  external
      sources(b)......................          (5)             (2)            -              -               (7)
   Prices  based  on  models  and  other
      valuation methods(c)............           6               2            (1)             -                7
   -------------------------------------------------------------------------------------------------------------------
   Total..............................       $   5          $    -         $  (1)         $   -            $   4
   ===================================================================================================================

   ===================================================================================================================
   UE
   Prices actively quoted.............       $   -          $    -         $   -          $   -            $   -
   Prices  provided  by  other  external
      sources(b)......................          (1)             (1)            -              -               (2)
   Prices  based  on  models  and  other
      valuation methods(c)............           5               1            (1)             -                5
   -------------------------------------------------------------------------------------------------------------------
   Total..............................       $   4          $    -         $  (1)         $   -            $   3
   ===================================================================================================================

   ===================================================================================================================
   CIPS
   Prices actively quoted.............       $   -          $    -         $   -          $   -            $   -
   Prices  provided  by  other  external
      sources(b)......................          (2)             (1)            -              -               (3)
   Prices  based  on  models  and  other
      valuation methods(c)............           -               -             -              -                -
   -------------------------------------------------------------------------------------------------------------------
   Total..............................       $  (2)         $   (1)        $   -          $   -            $  (3)
   ===================================================================================================================

   ===================================================================================================================
   CILCORP
   Prices actively quoted ............       $   -          $    -         $   -          $   -            $   -
   Prices  provided  by  other  external
      sources(b)......................           -               -             -              -                -
   Prices  based  on  models  and  other
      valuation methods(c)............           -               -             -              -                -
   -------------------------------------------------------------------------------------------------------------------
   Total                                     $   -          $    -         $   -          $   -            $   -
   ===================================================================================================================

   ===================================================================================================================
   CILCO
   Prices actively quoted ............       $   2          $    -         $   -          $   -            $   2
   Prices  provided  by  other  external
      sources(b)......................           -               -             -              -                -
   Prices  based  on  models  and  other
      valuation methods(c)............           -               -             -              -                -
   -------------------------------------------------------------------------------------------------------------------
   Total                                     $   2          $    -         $   -          $   -            $   2
   ===================================================================================================================
</TABLE>

(a)  Contracts  of less than $1  million  were with  non-investment-grade  rated
     counterparties.
(b)  Principally power forward values based on NYMEX prices for over-the-counter
     contracts and natural gas swap values based primarily on Inside FERC.
(c)  Principally  coal and sulfur dioxide option values based on a Black-Scholes
     model that includes  information  from external  sources and our estimates.
     Also includes power forward values based on our estimates.

                                       74

<PAGE>

ITEM 4.  Controls and Procedures.

     (a) Evaluation of Disclosure Controls and Procedures

     As of September  30, 2003,  the principal  executive  officer and principal
financial  officer of each  registrant have evaluated the  effectiveness  of the
design and operation of such registrant's disclosure controls and procedures (as
defined in Rules 13a - 15(e) and 15d - 15(e) of the  Exchange  Act).  Based upon
that evaluation, the principal executive officer and principal financial officer
of each such  registrant  have  concluded  that  such  disclosure  controls  and
procedures  are effective in timely  alerting  them to any material  information
relating  to  such  registrant,  which  is  required  to  be  included  in  such
registrant's reports filed or submitted with the SEC under the Exchange Act.

     (b) Change in Internal Controls

     There has been no significant  change in the registrants'  internal control
over financial  reporting that occurred  during their most recent fiscal quarter
that has  materially  affected,  or is reasonably  likely to materially  affect,
their internal control over financial reporting.

FORWARD-LOOKING STATEMENTS

     Statements made in this report which are not based on historical  facts are
"forward-looking"  and, accordingly,  involve risks and uncertainties that could
cause actual results to differ  materially from those  discussed.  Although such
"forward-looking"  statements  have  been  made in good  faith  and are based on
reasonable assumptions,  there is no assurance that the expected results will be
achieved.  These statements include (without limitation) statements as to future
expectations,  beliefs, plans, strategies,  objectives,  events,  conditions and
financial  performance.  In connection with the "safe harbor"  provisions of the
Private  Securities  Litigation  Reform  Act  of  1995,  we are  providing  this
cautionary  statement  to identify  important  factors  that could cause  actual
results to differ materially from those anticipated.  The following factors,  in
addition  to  those  discussed  elsewhere  in  this  report  and  in  subsequent
securities  filings and others,  could cause actual results to differ materially
from management expectations as suggested by such "forward-looking" statements:

o    the effects of the  stipulation  and agreement  relating to the UE Missouri
     electric  excess  earnings  complaint  case and other  regulatory  actions,
     including changes in regulatory policy;
o    changes in laws and other  governmental  actions,  including  monetary  and
     fiscal policies;
o    the impact on us of current  regulations  related  to the  opportunity  for
     customers to choose alternative energy suppliers in Illinois;
o    the  effects of  increased  competition  in the future due to,  among other
     things,  deregulation  of certain aspects of our business at both the state
     and federal levels;
o    the effects of participation in a FERC-approved RTO,  including  activities
     associated  with  the  Midwest  ISO;
o    the  availability of fuel for the production of  electricity,  such as coal
     and natural gas, and purchased power and natural gas for distribution,  and
     the level and  volatility  of future  market  prices for such  commodities,
     including the ability to recover any increased costs;
o    the use of financial and derivative instruments;
o    average rates for electricity in the Midwest;
o    business and economic conditions;
o    the impact of the adoption of new accounting  standards on the  application
     of appropriate technical accounting rules and guidance;
o    interest rates and the availability of capital;
o    actions of rating agencies and the effects of such actions;
o    weather conditions;
o    generation plant construction, installation and performance;
o    operation of nuclear power facilities and decommissioning costs;
o    the  effects  of  strategic   initiatives,   including   acquisitions   and
     divestitures;
o    the impact of current environmental regulations on utilities and generating
     companies and the  expectation  that more  stringent  requirements  will be
     introduced over time,  which could  potentially  have a negative  financial
     effect;
o    future wages and employee  benefit costs,  including  changes in returns on
     benefit plan assets;


                                       75

<PAGE>

o    disruptions  of the capital  markets or other  events  making our access to
     necessary capital more difficult or costly;
o    competition from other generating facilities, including new facilities that
     may be developed;
o    difficulties in integrating CILCO with Ameren's other businesses;
o    changes in the coal markets,  environmental  laws or  regulations  or other
     factors  adversely  impacting  synergy  assumptions in connection  with the
     CILCORP acquisition;
o    cost and availability of transmission  capacity for the energy generated by
     our  generating  facilities  or  required to satisfy  energy  sales made by
     Ameren; and
o    legal and administrative proceedings.

     Given these  uncertainties,  undue  reliance  should not be placed on these
forward-looking  statements.  Except  to the  extent  required  by  the  federal
securities  laws, we undertake no  obligation  to publicly  update or revise any
forward-looking  statements,  whether  as a result  of new  information,  future
events or otherwise.

                                       76

<PAGE>

                           PART II. OTHER INFORMATION

ITEM 1.  Legal Proceedings.

     Reference is made to Item 1. Legal  Proceedings  in Part II of Genco's Form
10-Q for the  quarterly  period  ended  June  30,  2003  for a  discussion  of a
complaint  filed  in July  2003 by Genco  and its  parent  company,  Development
Company,  in the Circuit Court of Cook County,  Illinois  against the Village of
Bartlett,  Illinois,  the Village  Trustees,  and Realen Homes,  L.P.  seeking a
declaratory  judgment and/or writ of certiorari to invalidate certain annexation
and rezoning  decisions by the Village  which could  impact  Genco's  combustion
turbine  generating units located in Elgin,  Illinois.  On August 28, 2003, both
the Village of Bartlett and Realen Homes,  L.P. filed motions to dismiss various
counts of the  complaint.  On October 15, 2003,  Genco and  Development  Company
filed an amended  complaint.  On November 7, 2003,  both the Village of Bartlett
and Realen  Homes,  L.P.  filed motions to dismiss the amended  complaint.  In a
related matter, on October 28, 2003, Genco filed a rulemaking  proceeding before
the Illinois Pollution Control Board seeking site specific noise limitations for
its combustion turbine generating units in Elgin, Illinois. The new limitations,
if adopted by the Illinois  Pollution  Control Board,  would allow Genco to meet
Illinois noise requirements in a newly proposed residential area.

     Note  3 -  Rate  and  Regulatory  Matters  and  Note  8 -  Commitments  and
Contingencies to our financial  statements under Item 1 of Part I of this report
contain additional information on legal and administrative proceedings which are
incorporated by reference under this item.

ITEM 6.  Exhibits and Reports on Form 8-K.

     (a)  (i) Exhibits filed herewith.

               10.1 - Contribution Agreement between CILCO and AERG.

               10.2 - Power Supply Agreement between AERG and CILCO.

               10.3 - Second  Amended  Ameren  Corporation  System Utility Money
                      Pool Agreement.

               10.4 - Ameren Corporation System Non-State  Regulated  Subsidiary
                      Money Pool Agreement.

               31.1 - Rule  13a  -14(a)/15d-14(a)  Certification  of  Principal
                      Executive Officer of Ameren Corporation (required by
                      Section 302 of the Sarbanes-Oxley Act of 2002).

               31.2 - Rule   13a-14(a)/15d-14(a)   Certification  of  Principal
                      Financial Officer of Ameren Corporation (required by
                      Section 302 of the Sarbanes-Oxley Act of 2002).

               31.3 - Rule  13a  -14(a)/15d-14(a)  Certification  of  Principal
                      Executive  Officer of UE (required  by  Section 302 of the
                      Sarbanes-Oxley Act of 2002).

               31.4 - Rule   13a-14(a)/15d-14(a)   Certification  of  Principal
                      Financial  Officer of UE (required  by  Section 302 of the
                      Sarbanes-Oxley Act of 2002).

               31.5 - Rule  13a  -14(a)/15d-14(a)  Certification  of  Principal
                      Executive Officer of CIPS (required  by Section 302 of the
                      Sarbanes-Oxley Act of 2002).

               31.6 - Rule   13a-14(a)/15d-14(a)   Certification  of  Principal
                      Financial Officer of CIPS (required  by Section 302 of the
                      Sarbanes-Oxley Act of 2002).

               31.7 - Rule  13a  -14(a)/15d-14(a)  Certification  of  Principal
                      Executive  Officer of Genco (required by Section 302 of
                      the Sarbanes-Oxley Act of 2002).

               31.8 - Rule   13a-14(a)/15d-14(a)   Certification  of  Principal
                      Financial  Officer of Genco (required by Section 302 of
                      the Sarbanes-Oxley Act of 2002).

                                       77

<PAGE>

               31.9 - Rule  13a  -14(a)/15d-14(a)  Certification  of  Principal
                      Executive Officer of CILCORP (required by Section 302 of
                      the Sarbanes-Oxley Act of 2002).

               31.10- Rule   13a-14(a)/15d-14(a)   Certification  of  Principal
                      Financial Officer of CILCORP (required by Section 302 of
                      the Sarbanes-Oxley Act of 2002).

               31.11- Rule  13a  -14(a)/15d-14(a)  Certification  of  Principal
                      Executive  Officer of CILCO  (required by Section 302 of
                      the Sarbanes-Oxley Act of 2002).

               31.12- Rule   13a-14(a)/15d-14(a)   Certification  of  Principal
                      Financial  Officer of CILCO  (required by Section 302 of
                      the Sarbanes-Oxley Act of 2002).

               32.1 - Section 1350 Certification of Principal  Executive Officer
                      of Ameren  Corporation (required  by  Section  906  of the
                      Sarbanes-Oxley Act of 2002).

               32.2 - Section 1350 Certification of Principal  Financial Officer
                      of  Ameren  Corporation  (required  by  Section  906  of
                      the Sarbanes-Oxley Act of 2002).

               32.3 - Section 1350 Certification of Principal  Executive Officer
                      of UE (required by Section 906 of the Sarbanes-Oxley Act
                      of 2002).

               32.4 - Section 1350 Certification of Principal  Financial Officer
                      of UE (required by Section 906 of the  Sarbanes-Oxley Act
                      of 2002).

               32.5 - Section 1350 Certification of Principal  Executive Officer
                      of CIPS (required by Section 906 of the Sarbanes-Oxley Act
                      of 2002).

               32.6 - Section 1350 Certification of Principal  Financial Officer
                      of CIPS (required by Section 906 of the  Sarbanes-Oxley
                      Act of 2002).

               32.7 - Section 1350 Certification of Principal  Executive Officer
                      of Genco (required by Section 906 of the  Sarbanes-Oxley
                      Act of 2002).

               32.8 - Section 1350 Certification of Principal  Financial Officer
                      of Genco (required by Section 906 of the  Sarbanes-Oxley
                      Act of 2002).

               32.9 - Section 1350 Certification of Principal Executive Officer
                      of CILCORP (required by Section 906 of  the Sarbanes-Oxley
                      Act of 2002).

               32.10- Section 1350 Certification of Principal  Financial Officer
                      of CILCORP (required  by Section 906 of the Sarbanes-Oxley
                      Act of 2002).

               32.11- Section 1350 Certification of Principal  Executive Officer
                      of CILCO (required by Section 906 of the Sarbanes-Oxley
                      Act of 2002).

               32.12- Section 1350 Certification of Principal  Financial Officer
                      of CILCO (required by Section 906 of the  Sarbanes-Oxley
                      Act of 2002).

(a) (ii) Exhibits incorporated by reference.

               4.1  - UE Company  Order dated October 7, 2003  establishing  the
                      4.65%  Senior  Secured  Notes  due 2013  (UE Form 8-K
                      dated October 7, 2003, Exhibit 4.2).



                                       78

<PAGE>

               4.2  - Supplemental Indenture dated October 1, 2003 to Indenture
                      of Mortgage and Deed of Trust dated June 15, 1937,  as
                      amended, from  UE to The  Bank of New  York, as  successor
                      trustee, relating to First  Mortgage  Bonds,  Senior Notes
                      Series EE, 4.65% due 2013 (UE Form 8-K dated October 7,
                      2003,  Exhibit 4.4).

     (b)  Reports on Form 8-K. The Ameren Companies filed the following  reports
          on Form 8-K during the quarterly period ended September 30, 2003:

<TABLE>
<CAPTION>
   ===================================================================================================================
                                                                                   Items       Financial Statements
                                     Date of Report                              Reported              Filed
   -------------------------------------------------------------------------------------------------------------------
<S>        <C>                                                                  <C>                <C>
   Ameren:
            July 17, 2003...............................................             5                 None
            July 30, 2003...............................................           7, 12                (a)
   -------------------------------------------------------------------------------------------------------------------
   UE:
            July 28, 2003...............................................           5, 7                None
   -------------------------------------------------------------------------------------------------------------------
   CIPS:
            None
   -------------------------------------------------------------------------------------------------------------------
   Genco:
            None
   -------------------------------------------------------------------------------------------------------------------
   CILCORP/CILCO:
            None
   ===================================================================================================================
     (a)  Unaudited  consolidated  operating  statistics  for the  three and six
          months ended June 30, 2003 and 2002,  consolidated Balance Sheet as of
          June 30, 2003 and  December 31, 2002,  and  consolidated  Statement of
          Cash Flows for the six months ended June 30, 2003 and 2002.
</TABLE>

                                       79

<PAGE>


                                   SIGNATURES

     Pursuant to the  requirements of the Exchange Act, each registrant has duly
caused this report to be signed on its behalf by the undersigned  thereunto duly
authorized. The signature for each undersigned company shall be deemed to relate
only to matters having reference to such company or its subsidiaries.



                                       AMEREN CORPORATION
                                          (Registrant)

                                      /s/ Martin J. Lyons
                               --------------------------------------
                                          Martin J. Lyons
                                   Vice President and Controller

                                  (Principal Accounting Officer)




                                    UNION ELECTRIC COMPANY
                                         (Registrant)

                                    /s/ Martin J. Lyons
                               --------------------------------------
                                        Martin J. Lyons
                                  Vice President and Controller

                                 (Principal Accounting Officer)




                               CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
                                             (Registrant)

                                       /s/ Martin J. Lyons
                               ---------------------------------------
                                           Martin J. Lyons
                                  Vice President and Controller

                                 (Principal Accounting Officer)




                                  AMEREN ENERGY GENERATING COMPANY
                                            (Registrant)

                                       /s/ Martin J. Lyons
                                ---------------------------------------
                                           Martin J. Lyons
                                    Vice President and Controller

                                   (Principal Accounting Officer)


                                       80

<PAGE>


                                             CILCORP Inc.
                                             (Registrant)

                                         /s/ Martin J. Lyons
                                ----------------------------------------
                                             Martin J. Lyons
                                      Vice President and Controller

                                     (Principal Accounting Officer)




                                    Central Illinois Light Company
                                              (Registrant)

                                         /s/ Martin J. Lyons
                                ----------------------------------------
                                             Martin J. Lyons
                                      Vice President and Controller

                                     (Principal Accounting Officer)




Date:  November 14, 2003



                                       81