UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                    FORM 10-Q

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

         For Quarterly Period Ended March 31, 1998

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

         For The Transition Period From                    to

                         Commission file number 1-2967.

                             UNION ELECTRIC COMPANY
             (Exact name of registrant as specified in its charter)

         Missouri                                                 43-0559760
(State or other jurisdiction of                               (I.R.S. Employer
incorporation or organization)                               Identification No.)


                 1901 Chouteau Avenue, St. Louis, Missouri 63103
              (Address of principal executive offices and Zip Code)


                         Registrant's telephone number,
                       including area code: (314) 621-3222


         Indicate by check mark whether the registrant (1) has 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) has been subject to such
filing requirements for the past 90 days.


                             Yes X .        No .


Shares  outstanding of each of registrant's  classes of common stock as of April
30, 1998:
    Common Stock, $5 par value - 102,123,834





<PAGE>




                             Union Electric Company

                                      Index

                                                                        Page No.

Part I            Financial Information (Unaudited)

                  Management's Discussion and Analysis .....................   2

                  Balance Sheet
                  - March 31, 1998 and December 31, 1997 ...................   6

                  Statement of Income
                  - Three months and 12 months ended
                    March 31, 1998 and 1997 ................................   7

                  Statement of Cash Flows
                  - Three months ended March 31, 1998 and 1997 .............   8

                  Notes to Financial Statements ............................   9



Part II           Other Information

<PAGE>
 
                    PART I. FINANCIAL INFORMATION (UNAUDITED)

MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL  CONDITION AND RESULTS OF
OPERATIONS

OVERVIEW

Union Electric  Company  (AmerenUE or the  Registrant) is a subsidiary of Ameren
Corporation  (Ameren), a newly created holding company which is registered under
the Public  Utility  Holding  Company Act of 1935  (PUHCA).  In  December  1997,
AmerenUE and CIPSCO Incorporated (CIPSCO) combined to form Ameren, with AmerenUE
and CIPSCO's subsidiaries,  Central Illinois Public Service Company (AmerenCIPS)
and CIPSCO  Investment  Company (CIC),  becoming  wholly-owned  subsidiaries  of
Ameren (the Merger).

The following  discussion and analysis  should be read in  conjunction  with the
Notes  to  Financial  Statements  beginning  on  page 9,  and  the  Management's
Discussion and Analysis of Financial Condition and Results of Operations (MD&A),
the Audited Financial Statements and the Notes to Financial Statements appearing
in the Registrant's 1997 Annual Report included in its 1997 Form 10-K.

RESULTS OF OPERATIONS

Earnings
First quarter 1998 earnings of $28 million  declined $1 million compared to 1997
first  quarter  earnings.  Earnings  for the 12 months ended March 31, 1998 were
$292  million,  a $7  million  increase  from  the  preceding  12-month  period.
Excluding the  extraordinary  charge  recorded in the fourth  quarter of 1997 to
write  off the  generation-related  regulatory  assets  and  liabilities  of the
Registrant's Illinois retail electric business, earnings for the 12-month period
ended March 31, 1998, were $327 million.

Earnings  fluctuated  due to many  conditions,  the primary ones being:  weather
variations,  credits to electric customers,  sales growth, fluctuating operating
costs,  the  write-off  of  certain  generation-related  regulatory  assets  and
liabilities, and merger-related costs. The significant items affecting revenues,
costs and earnings during the  three-month and 12-month  periods ended March 31,
1998, and 1997 are detailed below.

Electric Operations

<TABLE>
<CAPTION>

Electric Operating Revenues       Variations for periods ended March 31, 1998
                                       from comparable prior-year periods
-------------------------------- ------------------ ---- --------------------
(Millions of Dollars)              Three Months              Twelve Months
-------------------------------- ------------------ ---- --------------------
<S>                                <C>                       <C>        
Credit to customers                $        2                $        28
Effect of abnormal weather                (10)                         5
Growth and other                           15                         20
Interchange sales                         (12)                       (20)
-------------------------------- ------------------ ---- --------------------
                                   $       (5)               $        33
-------------------------------- ------------------ ---- --------------------
</TABLE>


The $5 million  decrease  in first  quarter  electric  revenues  compared to the
year-ago  quarter was primarily due to milder weather and decreased  interchange
sales.  Weather-sensitive  residential  kilowatthour  sales decreased 2 percent,
while  commercial  sales remained flat and industrial sales increased 2 percent,
reflecting a strong regional economy.  Interchange sales declined 14 percent due
to decreased sales opportunities.

The  increase  in electric  revenues  for the 12 months  ended  March 31,  1998,
compared to the prior  12-month  period was primarily  due to a lower  estimated
Missouri  customer credit recorded during the period,  partially  offset by a 13
percent decline in interchange  sales.  Residential  sales remained flat,  while
commercial and industrial sales increased 1 percent and 3 percent, respectively,
due to the strong regional economy.

                                       2

<PAGE>

<TABLE>
<CAPTION>

Fuel and Purchased Power                 Variations for periods ended March 31, 1998
                                              from comparable prior-year periods
---------------------------------------- ------------------  ---------------------
(Millions of Dollars)                      Three Months           Twelve Months
---------------------------------------- ------------------  ---------------------
<S>                                       <C>                    <C>
Fuel:
    Variation in generation                $        3             $         18
    Price                                           2                      (11)
    Generation efficiencies and other               -                        -
Purchased power variation                          (9)                     (16)
---------------------------------------- ------------------  ---------------------
                                           $       (4)            $         (9)
---------------------------------------- ------------------  ---------------------
</TABLE>

The decrease in fuel and purchased  power costs for the three months ended March
31, 1998 versus the  comparable  prior year quarter was primarily due to reduced
purchased  power  costs  resulting  from  relatively  flat native load sales and
decreased interchange sales.

The decrease in fuel and purchased power costs for the 12 months ended March 31,
1998 versus the year-ago  period was driven  mainly by reduced  purchased  power
costs,  resulting from relatively  flat native load sales and lower  interchange
sales as well as lower fuel prices, offset in part by greater generation.

Gas Operations
The $4 million  decrease in gas  revenues  for the three  months ended March 31,
1998 compared to the comparable  prior-year period was driven by lower gas costs
reflected in the purchased gas adjustment clause, partially offset by the annual
$11.5 million Missouri gas rate increase  effective  February 1998. Gas revenues
for the 12-month  period ended March 31, 1998  decreased $6 million  compared to
the same year-ago  period due to lower gas costs  reflected in the purchased gas
adjustment  clauses as well as lower dekatherm  sales,  partially  offset by the
Missouri gas rate increase.

Gas  costs for the three  months  ended  March 31,  1998  decreased  $8  million
compared  to the  year-ago  quarter  primarily  due to lower  gas  prices  while
dekatherm  sales remained flat. The $12 million  decline in gas costs for the 12
months  ended March 31, 1998  compared to the prior  12-month  period was due to
lower gas prices and a decline in dekatherm sales.

Other Operating Expenses
Other operating expense variations  reflected  recurring factors such as growth,
inflation, labor and benefit increases.

Other  operations  expenses  for the three  months and 12 months ended March 31,
1998  increased $5 million and $25 million,  respectively,  compared to the same
year-ago periods due to increases in information system-related costs, automated
meter costs and advertising expenses.

Maintenance expenses for the first quarter of 1998 decreased $1 million compared
to the year-ago quarter due to less scheduled fossil plant  maintenance.  The $8
million decrease in maintenance expenses for the 12-month period ended March 31,
1998 compared to the prior 12-month  period was due to the absence of a Callaway
Plant  refueling  in the  period  ended  March  31,  1998,  partially  offset by
increased scheduled fossil plant maintenance.  In April 1998, the Callaway Plant
commenced its scheduled  refueling outage. The refueling outage was completed in
early May 1998.

Depreciation and  amortization  expense for the three-month and 12-month periods
ended March 31, 1998, increased $3 million and $8 million, respectively,  versus
the comparable 1997 periods, primarily due to increased depreciable property and
amortization of the Missouri portion of merger-related costs which were recorded
as a  regulatory  asset upon  Merger  close under the  conditions  of the Merger
agreement.

In March 1998,  Ameren  announced plans to reduce its other operating  expenses,
including plans to eliminate  approximately  400 employee  positions by mid-1999
through a hiring freeze and a targeted voluntary separation plan. The Registrant
expects that the voluntary  separation  plan will result in a charge to earnings
in the third quarter of 1998 once it is known the number of employees  that will
accept the terms of the plan. At this time, the Registrant is unable to estimate
the expected charge to earnings resulting from the voluntary separation plan.

Taxes
Income taxes charged to operating  expenses for the three months ended March 31,
1998  increased $3 million versus the  comparable  1997 period  primarily due to
higher pretax income and a higher effective tax rate. The $5 million increase in

                                       3

<PAGE>

income  taxes  charged to  operating  expenses for the 12 months ended March 31,
1998 compared to the year-ago period was primarily due to higher pre-tax income.

Other Income and Deductions
Miscellaneous, net increased $14 million for the 12-month period ended March 31,
1998  compared  to the  year-ago  period  primarily  due to the  reversal of the
Missouri  portion of  merger-related  costs which were  recorded as a regulatory
asset upon Merger close under conditions of the Merger agreement.

Interest
Interest charges for the three months ended March 31, 1998, decreased $1 million
versus the prior-year period,  primarily due to the redemption of $40 million of
First Mortgage Bonds in March 1997. The $4 million  increase in interest expense
for the 12 months ended March 31, 1998 compared to the prior 12-month period was
primarily  due to higher  debt  outstanding  during the year at higher  interest
rates.

Balance Sheet
The $39 million decrease in trade accounts receivable and unbilled  revenues was
due primarily to lower  revenues in February and March 1998 compared to November
and December 1997.

Changes in accounts and wages  payable and other taxes  accrued  result from the
timing of various payments to taxing authorities and suppliers.

LIQUIDITY AND CAPITAL RESOURCES

Cash provided by operating  activities  totaled $62 million for the three months
ended March 31, 1998, compared to $66 million during the same 1997 period.

Cash flows used in investing  activities totaled $45 million and $73 million for
the three  months  ended  March 31,  1998 and 1997,  respectively.  Construction
expenditures  for the three months ended March 31, 1998 for  constructing new or
improving  existing  facilities,  and complying  with the Clean Air Act were $43
million. In addition,  the Registrant expended $4 million for the acquisition of
nuclear fuel. Capital  requirements for the remainder of 1998 are expected to be
principally for construction expenditures and the acquisition of nuclear fuel.

Cash flows used in  financing  activities  were $11 million for the three months
ended March 31, 1998,  compared to $17 million provided by financing  activities
during the same 1997 period. The Registrant's principal financing activities for
the three months ended March 31, 1998 included the issuance of long-term debt of
$65 million,  the issuance of short-term debt of $22 million,  the redemption of
$25 million of long-term debt and the payment of dividends.

The Registrant  plans to continue  utilizing  short-term  debt to support normal
operations and other temporary requirements. The Registrant is authorized by the
Securities  and  Exchange  Commission  under  PUHCA to have up to $1  billion of
short-term  unsecured debt instruments  outstanding at any one time.  Short-term
borrowings  consist of bank loans  (maturities  generally on an overnight basis)
and commercial paper  (maturities  generally within 10 to 45 days). At March 31,
1998, the Registrant had committed bank lines of credit aggregating $154 million
(of which $111  million were unused at such date) which make  available  interim
financing at various rates of interest based on LIBOR,  the bank  certificate of
deposit rate or other  options.  The lines of credit are  renewable  annually at
various dates  throughout  the year. At March 31, 1998,  the  Registrant had $43
million of short-term borrowings.

The  Registrant  also has a bank  credit  agreement  due 1999 which  permits the
borrowing of up to $300  million on a long-term  basis.  At March 31, 1998,  $75
million of such borrowings were outstanding.

Additionally,  the  Registrant  has a lease  agreement  which  provides  for the
financing of nuclear fuel. At March 31, 1998,  the maximum amount which could be
financed under the agreement was $120 million.  Cash provided from financing for
the first quarter of 1998 included issuances under the lease for nuclear fuel of
$1 million,  offset in part by $10 million of  redemptions.  At March 31,  1998,
$109 million was financed under the lease.

RATE MATTERS

As a result of the Electric  Service Customer Choice and Rate Relief Law of 1997
providing  for electric  utility  restructuring  in Illinois,  AmerenUE  filed a
proposal with the Illinois Commerce Commission to eliminate the electric
fuel

                                       4

<PAGE>

adjustment  clause  for  Illinois   retail  customers,   thereby   including   a
historical level of fuel costs in base rates. The ICC approved AmerenUE's filing
on April 28, 1998.

ACCOUNTING MATTERS

In February 1998, the Financial  Accounting  Standards Board issued Statement of
Financial  Accounting  Standards (SFAS) No. 132,  "Employers'  Disclosures about
Pensions  and  Other  Postretirement  Benefits."  SFAS  132  revises  employers'
disclosures  about pension and other  postretirement  benefit plans. SFAS 132 is
effective for fiscal years beginning after December 15, 1998,  although  earlier
application is encouraged. SFAS 132 is not expected to have a material impact on
the Registrant's financial position or results of operations upon adoption.

In March 1998,  the  Accounting  Standards  Executive  Committee of the American
Institute of Certified  Public  Accountants  issued  Statement of Position (SOP)
98-1,  "Accounting for the Costs of Computer Software  Developed or Obtained for
Internal  Use."  SOP 98-1  provides  guidance  on  accounting  for the  costs of
computer  software  developed  or obtained  for  internal  use.  Under SOP 98-1,
certain costs which are currently  expensed by the Registrant may be capitalized
and amortized  over some future  period.  SOP 98-1 is effective for fiscal years
beginning after December 15, 1998,  although earlier  application is encouraged.
At this time,  the  Registrant  is unable to determine the impact of SOP 98-1 on
its financial position or results of operations upon adoption.

SAFE HARBOR STATEMENT

Statements made in this Form 10-Q 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, the Registrant is providing
this cautionary  statement to identify important factors that could cause actual
results to differ materially from those  anticipated.  Factors include,  but are
not  limited to, the effects of  regulatory  actions;  changes in laws and other
governmental actions; competition; future market prices for electricity; average
rates for electricity in the Midwest; business and economic conditions;  weather
conditions; fuel prices and availability; generation plant performance; monetary
and fiscal policies; and legal and administrative proceedings.

                                       5

<PAGE>
                             UNION ELECTRIC COMPANY
                                  BALANCE SHEET
                                    UNAUDITED
                      (Thousands of Dollars, Except Shares)
<TABLE>
<CAPTION>
                                                                  March 31, December 31,
ASSETS                                                              1998         1997
------                                                           ----------  -----------
<S>                                                             <C>          <C>
Property and plant, at original cost:
   Electric                                                      $8,838,528   $8,832,039
   Gas                                                              200,127      197,959
   Other                                                             36,023       36,023
                                                                 ----------   ----------
                                                                  9,074,678    9,066,021
Less accumulated depreciation and amortization                    3,924,812    3,866,925
                                                                 ----------   ----------
                                                                  5,149,866    5,199,096
Construction work in progress:
   Nuclear fuel in process                                          139,306      134,804
   Other                                                             74,060       68,074
                                                                 ----------   ----------
         Total property and plant, net                            5,363,232    5,401,974
                                                                 ----------   ----------
Investments and other assets:
   Nuclear decommissioning trust fund                               147,304      122,438
   Other                                                             42,839       33,315
                                                                 ----------   ----------
         Total investments and other assets                         190,143      155,753
                                                                 ----------   ----------
Current assets:
   Cash and cash equivalents                                          8,998        3,232
   Accounts receivable - trade (less allowance for doubtful
         accounts of $4,104 and $3,645, respectively)               164,993      179,708
   Unbilled revenue                                                  47,233       71,156
   Other accounts and notes receivable                               53,689       41,028
   Materials and supplies, at average cost -
      Fossil fuel                                                    45,762       49,574
      Other                                                          98,060       97,375
   Other                                                             18,359       11,040
                                                                 ----------   ----------
         Total current assets                                       437,094      453,113
                                                                 ----------   ----------
Regulatory assets:
   Deferred income taxes                                            610,893      611,740
   Other                                                            174,894      179,705
                                                                 ----------   ----------
         Total regulatory assets                                    785,787      791,445
                                                                 ----------   ----------
Total Assets                                                     $6,776,256   $6,802,285
                                                                 ==========   ==========

CAPITAL AND LIABILITIES
Capitalization:
   Common stock, $5 par value, authorized 150,000,000 shares -
      outstanding 102,123,834 shares                             $  510,619   $  510,619
   Other paid-in capital, principally premium on
     common stock                                                   701,896      716,879
   Retained earnings                                              1,126,473    1,159,956
                                                                 ----------   ----------
         Total common stockholders' equity                        2,338,988    2,387,454
   Preferred stock not subject to mandatory redemption              155,197      155,197
   Long-term debt                                                 1,875,497    1,846,482
                                                                 ----------   ----------
         Total capitalization                                     4,369,682    4,389,133
                                                                 ----------   ----------
Current liabilities:
   Current maturity of long-term debt                                30,687       28,797
   Short-term debt                                                   43,000       21,300
   Accounts and wages payable                                        95,182      188,014
   Accumulated deferred income taxes                                 42,715       35,809
   Taxes accrued                                                    142,426       94,167
   Other                                                            136,821      142,859
                                                                 ----------   ----------
         Total current liabilities                                  490,831      510,946
                                                                 ----------   ----------
Accumulated deferred income taxes                                 1,261,256    1,264,800
Accumulated deferred investment tax credits                         148,516      149,891
Regulatory liability                                                169,507      175,638
Other deferred credits and liabilities                              336,464      311,877
                                                                 ----------   ----------
Total Capital and Liabilities                                    $6,776,256   $6,802,285
                                                                 ==========   ==========


                                       6
</TABLE>

<PAGE>


                             UNION ELECTRIC COMPANY
                               STATEMENT OF INCOME
                                    UNAUDITED
                             (Thousands of Dollars)


<TABLE>
<CAPTION>


                                                                 Three Months Ended                 Twelve Months Ended
                                                                       March 31,                           March 31,
                                                          -------------------------------      --------------------
                                                                  1998          1997                 1998           1997
                                                                 ----           ----                 ----           ----

<S>                                                        <C>            <C>                  <C>            <C>
 OPERATING REVENUES:
    Electric                                                $   436,317    $   440,967          $ 2,183,921    $ 2,150,917
    Gas                                                          42,094         46,110               94,243        100,626
    Other                                                           174            181                  496            509
                                                            -----------    -----------          -----------    -----------
       Total operating revenues                                 478,585        487,258            2,278,660      2,252,052

 OPERATING EXPENSES:
    Operations
       Fuel and purchased power                                 111,777        116,191              495,581        504,758
       Gas                                                       19,979         27,509               55,923         67,731
       Other                                                    100,109         95,477              409,588        384,781
                                                            -----------    -----------          -----------    -----------
                                                                231,865        239,177              961,092        957,270
    Maintenance                                                  48,045         49,198              216,273        224,195
    Depreciation and amortization                                64,521         61,444              251,038        243,158
    Income taxes                                                 24,432         21,335              195,863        190,483
    Other taxes                                                  47,602         50,517              209,034        212,799
                                                            -----------    -----------          -----------    -----------
       Total operating expenses                                 416,465        421,671            1,833,300      1,827,905

 OPERATING INCOME                                                62,120         65,587              445,360        424,147

 OTHER INCOME AND DEDUCTIONS:
    Allowance for equity funds used during
       construction                                               1,017            877                4,601          5,667
    Miscellaneous, net                                             (519)        (1,081)               7,896         (6,269)
                                                            -----------    -----------          -----------    -----------
       Total other income and deductions                            498           (204)              12,497           (602)

 INCOME BEFORE INTEREST CHARGES                                  62,618         65,383              457,857        423,545

 INTEREST CHARGES:
    Interest                                                     34,160         35,180              137,656        133,966
    Allowance for borrowed funds used during construction        (1,844)        (1,427)              (7,093)        (6,787)
                                                            -----------    -----------          -----------    -----------
    Net interest charges                                         32,316         33,753              130,563        127,179

 INCOME BEFORE EXTRAORDINARY CHARGE                              30,302         31,630              327,294        296,366
                                                            -----------    -----------          -----------    -----------

 EXTRAORDINARY CHARGE (NET OF
 INCOME TAXES)                                                     --             --                (26,967)          --
                                                            -----------    -----------          -----------    -----------

 NET INCOME                                                      30,302         31,630              300,327        296,366

 PREFERRED STOCK DIVIDENDS                                        2,204          2,204                8,817         12,141
                                                            -----------    -----------          -----------    -----------

NET INCOME AFTER PREFERRED
       STOCK DIVIDENDS                                      $    28,098    $    29,426          $   291,510    $   284,225
                                                            ===========    ===========          ===========    ===========


                                       7

</TABLE>

<PAGE>


                             UNION ELECTRIC COMPANY
                             STATEMENT OF CASH FLOWS
                                    UNAUDITED
                             (Thousands of Dollars)


<TABLE>
<CAPTION>


                                                         Three Months Ended
                                                              March 31,
                                                       ----------------------
                                                            1998         1997
<S>                                                   <C>          <C>
Cash Flows From Operating:
   Net income                                          $  30,302    $  31,630
   Adjustments to reconcile net income to net cash
      provided by operating activities:
        Depreciation and amortization                     62,242       59,165
        Amortization of nuclear fuel                       9,617        9,834
        Allowance for funds used during construction      (2,861)      (2,304)
        Deferred income taxes, net                        (1,922)        (296)
        Deferred investment tax credits, net              (1,375)      (1,543)
        Changes in assets and liabilities:
           Receivables, net                               25,977       44,750
           Materials and supplies                          3,127        8,238
           Accounts and wages payable                    (92,832)    (105,857)
           Taxes accrued                                  48,259       45,966
           Other, net                                    (18,690)     (24,028)
                                                       ---------    ---------
Net cash provided by operating activities                 61,844       65,555

Cash Flows From Investing:
   Construction expenditures                             (43,186)     (71,942)
   Allowance for funds used during construction            2,861        2,304
   Nuclear fuel expenditures                              (4,422)      (3,722)
                                                       ---------    ---------
Net cash used in investing activities                    (44,747)     (73,360)

Cash Flows From Financing:
   Dividends on common stock                             (61,581)     (64,849)
   Dividends on preferred stock                           (2,204)      (2,204)
   Redemptions -
      Nuclear fuel lease                                 (10,407)      (4,615)
      Long-term debt                                     (25,000)     (40,000)
      Preferred stock                                       --        (63,924)
   Issuances -
      Nuclear fuel lease                                   1,161       11,910
      Short-term debt                                     21,700       22,600
      Long-term debt                                      65,000      158,000
                                                       ---------    ---------
Net cash provided by (used in) financing activities      (11,331)      16,918

Net increase in cash and cash equivalents                  5,766        9,113
Cash and cash equivalents at beginning of year             3,232        4,897
                                                       ---------    ---------
Cash and cash equivalents at end of period             $   8,998    $  14,010
                                                       =========    =========

Cash paid during the periods:
   Interest (net of amount capitalized)                $  19,210    $  20,981
   Income taxes, net                                   $  (3,072)   $       1



                                       8
</TABLE>


<PAGE>


UNION ELECTRIC COMPANY
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
MARCH 31, 1998

Note 1 - Effective  December  31,  1997,  following  the receipt of all required
state and federal regulatory approvals,  Union Electric Company (AmerenUE or the
Company) and CIPSCO  Incorporated  (CIPSCO) combined to form Ameren  Corporation
(Ameren)(the Merger).

Note 2 - Financial  statement note  disclosures,  normally included in financial
statements prepared in conformity with generally accepted accounting principles,
have been omitted in this Form 10-Q pursuant to the Rules and Regulations of the
Securities and Exchange  Commission.  However, in the opinion of the Registrant,
the disclosures contained in this Form 10-Q are adequate to make the information
presented not misleading. See Notes to Financial Statements included in the 1997
Form 10-K for information relevant to the financial statements contained in this
Form 10-Q,  including  information as to the significant  accounting policies of
the Registrant.

Note 3 - In the opinion of the Registrant the interim financial statements filed
as part of this Form 10-Q  reflect all  adjustments,  consisting  only of normal
recurring  adjustments,  necessary  for a fair  statement of the results for the
periods presented. Registrant's financial statements were prepared to permit the
information  required in the Financial  Data Schedule  (FDS),  Exhibit 27, to be
directly  extracted from the filed statements.  The FDS amounts correspond to or
are calculable  from the amounts  reported in the financial  statements or notes
thereto.

Note 4 - Due to the  effect of  weather  on sales and  other  factors  which are
characteristic of public utility  operations,  financial results for the periods
ended March 31, 1998 and 1997 are not  necessarily  indicative of trends for any
three-month or twelve-month period.

Note 5 - On July 21,  1995,  the  Missouri  Public  Service  Commission  (MoPSC)
approved an agreement  involving the Registrant's  Missouri  electric rates. The
Agreement included a three-year  experimental  alternative  regulation plan that
provides that earnings in excess of a 12.61 percent  regulatory return on equity
(ROE) will be shared equally  between  customers and  shareholders  and earnings
above 14 percent ROE will be credited to  customers.  The formula for  computing
the credit uses  twelve-month  results ending June 30, rather than calendar year
earnings.  During the three months ended March 31, 1998, the Registrant recorded
an estimated  $10 million  credit for the third year of the plan compared to $20
million recorded for 1997. This credit,  which the Registrant  expects to pay to
Missouri  customers  later this year,  was  reflected as a reduction in electric
revenues.  The final  amount of the  credit  will  depend  on  several  factors,
including the Registrant's earnings for 12 months ending June 30, 1998.

A new three-year  experimental  alternative  regulation plan was included in the
joint  agreement  approved by the MoPSC in its February 1997 order approving the
Merger.  Like the current plan, the new plan requires that earnings over a 12.61
percent ROE up to a 14 percent ROE will be shared equally between  customers and
stockholders.  The new three-year  plan will also return to customers 90 percent
of all earnings above a 14 percent ROE up to a 16 percent ROE. Earnings above 16
percent ROE would be credited entirely to customers.

Note 6 - Statement of Financial  Accounting Standards (SFAS) No. 130, "Reporting
Comprehensive  Income"  became  effective on January 1, 1998.  SFAS 130 requires
that all items that are required to be recognized under accounting  standards as
components of comprehensive  income be reported in the financial statements with
the same prominence as other financial  statement  components.  Adoption of SFAS
130 did not  have a  material  effect  on the  financial  position,  results  of
operations,   liquidity  or  presentation   of  financial   information  of  the
Registrant.



                                       9

<PAGE>



                           PART II. OTHER INFORMATION


ITEM 4.        SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

            At the annual  meeting of  stockholders  of the  Registrant  held on
April 28, 1998, the following matter was presented to the meeting for a vote and
the results of such voting are as follows:

<TABLE>
<CAPTION>


            Item (1)      Election of Directors.
                                                                                          Non-Voted
                   Name                              For                Withheld            Brokers
       <S>                                       <C>                    <C>                    <C>
        Paul A. Agathen.........................  104,211,083            17,752                 0
        Donald E. Brandt........................  104,210,108            18,552                 0
        Charles W. Mueller......................  104,211,083            17,752                 0
        Gary L. Rainwater.......................  104,210,683            18,152                 0
        Charles J. Schukai......................  104,210,314            17,852                 0
</TABLE>




                                       10
<PAGE>








ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         (a)    Exhibits.

                Exhibit 12               -   Computation of Ratio of Earnings to
                                             Fixed Charges and Preferred Stock
                                             Dividend Requirements, 12 Months
                                             Ended March 31, 1998.

                Exhibit 27               -   Financial Data Schedule.

               (b) Reports on Form 8-K. During the quarter, the Registrant filed
a report on Form 8-K dated  January  20,  1998  reporting  the impact of utility
restructuring  legislation in Illinois and the expectation of lower earnings for
1998.




                                   SIGNATURES

               Pursuant to the  requirements  of the Securities  Exchange Act of
1934,  the  Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.


                                                UNION ELECTRIC COMPANY
                                                     (Registrant)



May 13, 1998                               By        /s/ Donald E. Brandt
                                              ---------------------------
                                                         Donald E. Brandt
                                                       Senior Vice President
                                                  Finance and Corporate Services




                                       11