EXHIBIT 10.5B


                             EXECUTIVE INSURANCE

                                  AGREEMENT

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

This Agreement is made this 21st day of May, 1997, by and between Amcore
Financial, Inc., having its principal place of business in Rockford, Illinois
(the "Corporation"), and (the "Executive").

                                  WITNESSETH
                                  ----------

WHEREAS, the Executive is a valued employee of the Corporation; and

WHEREAS, the Corporation wishes to assist the Executive with his or her
personal life insurance program both as an inducement to the Executive's
continued employment and in recognition of the Executive's ongoing valuable
contribution to the business success of the Corporation; and

WHEREAS, the Executive is the owner of an insurance policy on his or her life,
including all supplemental riders or endorsements to such insurance policy,
which policy the Executive and Corporation wish to make subject to a life
insurance plan pursuant to the terms and conditions of this Agreement;

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants set
forth below, the Corporation and Executive agree as follows:

                                  ARTICLE I

                           OWNERSHIP OF THE POLICY

1.1     EXECUTIVE AS OWNER.
        -------------------
The Executive shall be the owner of the policy (including all supplemental
riders or endorsements) (the "Policy") and may exercise all ownership rights
granted to the owner by the terms of the Policy, except as may otherwise be
provided in this Agreement. The Executive and the Corporation agree that the
Policy shall be subject to the terms and conditions of this Agreement.

<PAGE>

1.2     ASSIGNMENT.
        -----------
The Executive agrees to execute an assignment (the "Assignment") to the
Corporation to secure the Corporation's rights under this Agreement, in the
form required by or acceptable to the issuer of the Policy (the "Issuer"), a
copy of which is attached as Exhibit I. The Assignment shall set forth the
rights of the Corporation in and with respect to the Policy pursuant to the
terms and conditions of this Agreement. The Executive and the Corporation
agree to be bound by the terms of the Assignment.

1.3     CORPORATION'S RIGHTS.
        ---------------------
The Corporation's rights with respect to the Policy shall be limited to the
following:

  (a) The sole right to obtain one or more loans or advances against the cash
  surrender value of the Policy; however, such loans shall be limited to the
  amount set forth in Section 4.3 below (the "Corporate Interest");

  (b) The sole right to pledge or assign the Corporate Interest as security
  for loans or advances;

  (c) The right to fully or partially surrender the Policy upon termination of
  the Agreement;

  (d) The sole right to realize up to the Corporate Interest in the cash
  surrender value of the Policy on the full or partial surrender of the
  Policy;

  (e) The right to exercise all non-forfeiture or lapse option rights
  permitted by the terms of the Policy;

  (f) The right to realize the proceeds of the Policy as set forth in Section
  3.2 below (the "Corporation's Death Benefit Portion") upon the Executive's
  death; and

  (g) The right to release the Assignment upon receipt of the Corporate
  Interest.

1.4     EXECUTIVE'S RIGHTS.
        -------------------
The Executive shall retain all other rights as owner of the Policy, including,
but not limited to, the following:

  (a) The right to designate and to change the beneficiary or beneficiaries on
      the portion of the proceeds of the Policy payable to the Executive's
      beneficiary pursuant to subsection 3.1 below (the "Executive's Death
      Benefit Portion") upon the Executive's death;

  (b) The right to elect any optional form of settlement available with
      respect to the Executive's Death Benefit Portion; and

<PAGE>

  (c) The right to assign the Executive's rights in and with respect to the
  Policy. including the right to assign ownership of the Policy to a third
  party.

However, before the date the Corporation receives the Corporate Interest under
the terms of Article IV, the Executive shall not have the right to obtain a
loan or advance against the cash surrender value of the Policy, or to fully or
partially surrender the Policy.

                                  ARTICLE II
                                  ----------
                              INSURANCE PREMIUMS
2.1     AMOUNT OF PREMIUM.
        ------------------
For purposes of this Agreement, the term "premium" shall mean the yearly
premium necessary to provide a life insurance benefit at least equal to the
Executive's Death Benefit Portion (as defined in Section 3.1). "Premium" shall
also include all costs associated with all supplemental riders and
endorsements to the Policy.

2.2     PAYMENT OF PREMIUM.
        -------------------
The Corporation shall pay the premium on the Policy to the Issuer on or before
the due date of each premium payment, and in any event, not later than the
expiration of the grace period under the Policy for the premium payment. The
Corporation shall furnish the Executive with written notice of payment.

If the Corporation fails to make any premium payment within 20 days after its
due date, the Executive may make the premium payment. If the Executive makes
the premium payment, the Corporation shall reimburse the Executive for the
premium within ten days after the Executive makes the premium payment.

The Corporation reserves the right to require the Executive to pay a portion
of the premium or to reimburse the Corporation for part of the premium.
However, the amount of premium the Executive may be required to pay or
reimburse shall be limited to the amount that otherwise would be treated as
taxable income under Section 2.3.

2.3     TAX CONSEQUENCES TO THE EXECUTIVE.
        ----------------------------------

In the event that the Corporation's payment of any premium is deemed to be
taxable income to the Executive pursuant to any applicable tax law or
regulation, the Corporation shall furnish the Executive with written notice of
the amount of such taxable income. The written notice shall be provided on or
before January 31 following the year during which the premium is paid. At the
Corporation's election, the notice may be provided using IRS Form W-2.

<PAGE>

Under current tax law, the Executive will be deemed to have taxable income
equal to the amount of the annual cost of the pure insurance protection on the
life of the Executive under the Policy for the ensuing policy year. The
additional taxable income shall be equal to the lesser of the following:

  (a) That rate per $1,000 of pure insurance protection promulgated by the
  Internal Revenue Service in Rev. Rul. 55-747, 1955-2 C.B. 228, as the same
  may be amended or replaced from time to time by published ruling (the "PS-58
  rate") as applied to such amount of pure insurance protection provided to
  the Executive pursuant to the terms of this Agreement; or

  (b) That current published rate per $1,000 of pure insurance protection
  charged by the Issuer for initial-issue individual one-year term insurance
  policies available to all standard risks as applied to such amount of pure
  insurance protection provided to the Executive pursuant to the terms of this
  Agreement.

2.4     PAYMENT TO THE EXECUTIVE.
        -------------------------
The Corporation shall increase the Executive's compensation by the amount of
any premium paid by the Executive pursuant to Section 2.2.

                                 ARTICLE III
                                 -----------
                        RIGHTS UPON DEATH OF EXECUTIVE

3.1     EXECUTIVE'S DEATH BENEFIT PORTION.
        ----------------------------------
Upon the death of the Executive, the Executive's designated beneficiary or
beneficiaries shall be entitled to receive the Executive's Death Benefit
Portion. The Executive's Death Benefit Portion shall be an amount equal to
$1,000,000 while remaining an active employee.

3.2     CORPORATION'S DEATH BENEFIT PORTION.
        ------------------------------------
Upon the death of the Executive, the Corporation shall be entitled to receive
an amount equal to the Corporation's Death Benefit Portion. The Corporation's
Death Benefit Portion shall be an amount equal to the remaining net death
benefit under the Policy after paying the Executive's Death Benefit Portion.

3.3     BENEFICIARY DESIGNATION.
        ------------------------
The Executive and the Corporation agree to conform the beneficiary designation
of the Policy to the provisions of this Agreement.

<PAGE>

                                  ARTICLE IV
                                  ----------
                           TERMINATION OF AGREEMENT

4.1     TERMINATION DEFINED.
        --------------------
The Corporation reserves the right to terminate this Agreement for any reason.
This Agreement shall automatically terminate upon the occurrence of any of the
following events:

  (a) The bankruptcy, receivership or dissolution of the Corporation.

  (b) The Executive's retirement from the Corporation; provided, however, if
  the retirement occurs within ten years after the date the Policy was issued
  or before an amount equal to the Corporate Interest can be withdrawn from
  the policy without incurring tax under the Code Section 7702(f)(7) the
  following applies:

    (i) If the Executive waives all post-retirement life insurance benefits
    from the Corporation, the Executive's retirement shall be the termination
    event

    (ii) If the Executive does not waive all post-retirement life insurance
    benefits from the Corporation, the termination event shall be the latest
    of the tenth anniversary of the date the Policy was issued or the Policy
    anniversary following the final premium payment before an amount equal to
    the Corporate Interest can be withdrawn from the Policy without incurring
    tax under Code Section 7702(f)(7).

  (c) The termination of employment of the Executive with the Corporation
  (other than by reason of death or retirement).

  (d) The mutual written agreement of the Executive and the Corporation.

Notwithstanding anything to the contrary in this Agreement, the Corporation
may terminate this Agreement with regard to the Executive for any reason.

The term "retirement" in this Section means a termination of employment with
the Corporation after satisfying the requirements for an early or normal
retirement. Also, if the Executive is receiving long-term disability benefits
under a plan sponsored by the Corporation, the Executive shall not be deemed
to have terminated employment with the Corporation.

<PAGE>

4.2     RIGHTS UPON TERMINATION.
        ------------------------
Upon termination of this Agreement, the Executive shall pay to the Corporation
the amount determined pursuant to Section 4.3 below. Upon receipt of such
amount from the Executive, the Corporation shall take all steps necessary to
release the Assignment so that the Executive (or his assignee as owner of the
Policy) shall own the Policy free of all encumbrances in favor of the
Corporation required by this Agreement. The Executive (or his assignee) may
then take any action with regard to the Policy that is available under the
terms of the Policy to the Policy's owner.

        4.3     Corporate Interest. For purposes of this Agreement, the term
"Corporate Interest" means an amount payable from the cash surrender value of
the Policy equal to the cumulative amount of all premiums paid, without
interest.  However, the Corporate Interest shall be decreased by the sum of
any indebtedness described in Section 1.3(a) and the surrender charges, if
any, imposed by the Issuer. In no event shall the Corporate Interest exceed
the amount of the Policy's cash surrender value. The Corporate Interest shall
be paid by the Executive as specified in Section 4.2 above or by the Issuer
upon surrender of the Policy.

                                  ARTICLE V
                                  ---------
                          ADMINISTRATIVE PROVISIONS

5.1     NO OTHER LIFE INSURANCE PROVIDED BY CORPORATION.
        ------------------------------------------------
The Corporation shall have no obligation to provide the Executive with life
insurance benefits, either during employment by the Corporation or after
retirement, other than pursuant to this Agreement.

5.2     ISSUER'S RESPONSIBILITY.
        ------------------------
The Issuer shall not be considered a party to this Agreement. No provision of
this Agreement shall in any way change the obligations of the Issuer as
expressly provided in the Policy, except as the Agreement may become a part of
the Policy by the Issuer's acceptance of the Assignment.

5.3     AMENDMENT.
        ----------
This Agreement may be amended only by a written agreement signed by both the
Executive and a duly authorized representative of the Corporation.

<PAGE>

5.4     NOTICE.
        -------
Any and all notices required to be given under the terms of this Agreement
shall be given in writing and signed by the appropriate party, and shall be
sent by certified mail, postage prepaid, to the appropriate address set forth
below:

  (a) To the Executive at:
      Kenneth E. Edge
      1684 Oakforest Drive
      Rockford, IL 61107



      To the Corporation at:
      Amcore Financial, Inc.
      501 7th Street
      P. O. Box 1537
      Rockford, IL  61110-0037
      Attention: Secretary


5.5     HEIRS, SUCCESSORS AND ASSIGNS.
        ------------------------------
This Agreement shall be binding upon and shall inure to the benefit of (i) the
Executive, his or her successors, heirs and the executors or administrators of
the Executive's estate, and (ii) the Corporation and its successors. The
Executive and the Corporation agree that either party may assign its interest
under this Agreement upon the prior written consent of the other party, and
any assignee shall be bound by the terms and conditions of this Agreement as
if an original party to the Agreement.

5.6     INTERPRETATION.
        ---------------
This Agreement shall be governed by and construed in accordance with the laws
of the State of Illinois.

5.7     TERMS.
        ------
This Agreement shall be effective as of the date first above written, and
shall continue until terminated as provided in Section 4.1 or until all
covenants under the Agreement contingent upon the death of the Executive are
fully carried out.

5.8     HEADINGS.
        ---------
Any headings or captions in this Agreement are for reference purposes only,
and shall not change or affect the meaning of any provision of this Agreement.

<PAGE>

5.9     COUNTERPARTS.
        -------------
This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original, and all of which together shall constitute one
and the same Agreement.

5.10    EMPLOYMENT RIGHTS.
        ------------------
The existence of this Agreement shall not grant Executive any legal right to
continue as an employee of the Corporation nor affect the right of the
Corporation to discharge the Executive.

5.11    FIDUCIARY.
        ----------
The Corporation shall be the named Fiduciary and administrator (the
"Fiduciary") of the split-dollar arrangement established pursuant to this
Agreement. The Fiduciary shall have full power to administer this Agreement,
and the Fiduciary's actions with respect hereto shall be binding and
conclusive upon all persons for all purposes; subject to Section 5.12. The
Fiduciary shall not be liable to any person for any action taken or omitted in
connection with its responsibilities, rights and duties under this Agreement
unless attributable to willful misconduct or lack of good faith.

5.12    CLAIMS PROCEDURE.
        -----------------
The parties understand and agree that the Fiduciary has no authority or
control over the claims procedures of the insurance company which issues the
Policy. Any delay or denial of a claim by the Insurer shall not be controlled
by the following claims procedure.

Any controversy or claim arising out of or relating to this Agreement shall be
filed with the Fiduciary, which shall make all determinations concerning the
claim. Any decision by the Fiduciary denying the claim shall be in writing and
shall be delivered to all parties in interest in accordance with the notice
provisions of Section 5.4. The decision shall set forth the reasons for denial
in plain language. Pertinent provisions of the Agreement shall be cited and,
where appropriate, an explanation as to how the Executive can perfect the
claim will be provided. This notice of denial of benefits shall be provided
within 90 days of the Fiduciary's receipt of the Executive's claim for
benefits. If the Fiduciary fails to notify the Executive of its decision
regarding his claim within the 90 day period, the claim shall be considered
denied, and the Executive shall then be permitted to proceed with his appeal
as provided in this Section.

An Executive who has been completely or partially denied a benefit shall be
entitled to appeal this denial of his claim by filing a written statement of
his position with the Fiduciary no later than 60 days after receipt of the
written notification of the claim denial. The Fiduciary shall schedule an
opportunity for a full and fair review of the issue within 30 days after
receipt of the appeal.

<PAGE>

Following its review of any additional information submitted by the Executive,
either through the hearing process or otherwise, the Fiduciary shall render a
decision on its review of the denied claim in the following manner:

  (a) The Fiduciary shall make its decision regarding the merits of the denied
  claim within 60 days following its receipt of the request for review (or
  within 120 days after receipt, in a case where there are special
  circumstances requiring extension of time for reviewing the appealed claim).
  The Fiduciary shall deliver the decision to the claimant in writing.

  If an extension of time for reviewing the appealed claim is required because
  of special circumstances, written notice of the extension shall be furnished
  to the Executive prior to the commencement of the extension. If the decision
  on review is not furnished within the prescribed time, the claim shall be
  deemed denied on review.

  (b) The decision on review shall set forth specific reasons for the
  decision, and shall cite specific references to the pertinent Agreement
  provisions on which the decision is based.

IN WITNESS OF WHICH, the Corporation and Executive have duly executed this
Agreement.

                AMCORE FINANCIAL, INC.

                By  /s/ James S. Waddell
                    -----------------------
                Its EVP & CAO
                    -----------------------



                THE EXECUTIVE

                    /s/ Kenneth E. Edge
                    -----------------------
                    Kenneth E. Edge
                    (Name of Executive)

<PAGE>

                 COLLATERAL ASSIGNMENT OF SPLIT-DOLLAR POLICY

This Assignment is made this 21st day of May, 1997, by the undersigned (herein
called Owner), to Amcore Financial, Inc. an Illinois Corporation (herein
called Corporation), its successors and assigns.

1.      The subject of this Assignment is a certain life insurance policy No.
        10002500000063, issued by the Life Investors Insurance Company of
        America (herein called the Insurer).

2.      The Policy is subject to a Collateral Assignment Split-Dollar
        Agreement (herein called Agreement) dated May 21, 1997, between the
        Corporation and Kenneth E. Edge.  The Agreement was created to assist
        Kenneth E. Edge with his/her personal life insurance program as an
        employee benefit for a valued key employee.  Such Agreement is hereby
        incorporated into and made a part of this Assignment.

3.      The Owner hereby assigns, transfers, and sets over to the Corporation
        the following specific limited rights in the Policy, and subject to
        the following terms and provisions:

        (a)     This assignment is made, and the Policy is held as collateral
                security for the premium advances to the Owner, now existing
                or hereafter made by the Corporation under the terms of the
                Agreement.

        (b)     The Corporation's rights in the Policy are to the extent of
                its interest in the Policy as stated in Section 1.3 of the
                attached Split Dollar Agreement.

4.      The Corporation shall have a right to obtain from the Insurer one or
        more loans or advances against its interest in the cash surrender
        values of the Policy.

        (a)     The Corporation shall be responsible for the payment of
                interest on any such loans by the Corporation against such
                cash surrender values of the Policy during the term of the
                Agreement.

        (b)     Such loans or withdrawals made by the Corporation against (or
                from) the cash surrender values of the Policy shall be treated
                as repayments of the Corporation's premium advances by the
                Owner.

        (c)     Premium payments paid as a result of a Waiver of Premium Rider
                shall be included as premium paid by the Corporation only in
                the event the Corporation in fact paid the waiver of premium
                charge.

<PAGE>

5.      The Corporation shall have the right to be repaid to the extent of its
        interest:

        (a)     in the event of the death of the insured on the Policy;

        (b)     in the event the Policy is lapsed, canceled or surrendered by
                the Owner; or

        (c)     in the event of the termination of the Split Dollar Agreement.

6.      The Corporation's rights with respect to the Policy shall be limited
        to the following:

        (a)     The sole right to obtain one or more loans or advances against
                the cash surrender value of the Policy; however, such loans
                shall be limited to the Corporate Interest as defined in
                Section 4.3 of the Agreement;

        (b)     The sole right to pledge or assign the Corporate Interest as
                security for loans or advances;

        (c)     The right to fully or partially surrender the Policy upon
                termination of the Agreement;

        (d)     The sole right to realize up to the Corporate Interest in the
                cash surrender value of the Policy on the full or partial
                surrender of the Policy;

        (e)     The right to exercise all non-forfeiture or lapse option
                rights permitted by the terms of the Policy;

        (f)     The right to realize the proceeds of the Policy as set forth
                in Section 3.2 of the Agreement (the "Corporation's Death
                Benefit Portion") upon the Executive's death; and

        (g)     The right to release the Assignment upon receipt of the
                Corporate Interest.

<PAGE>

7.      The Owner shall retain all other rights as owner of the Policy,
        including, but not limited to, the following:


        (a)     The right to designate and to change the beneficiary or
                beneficiaries on the portion of the proceeds of the Policy
                payable to the Executive's beneficiary pursuant to subsection
                3.1 of the Agreement (the "Executive's Death Benefit Portion")
                upon the Executive's death;

        (b)     The right to elect any optional form of settlement available
                with respect to the Executive's Death Benefit Portion; and

        (c)     The right to assign the Owner's rights in and with respect to
                the Policy, including the right to assign ownership of the
                Policy to a third party.

        However, before the date the Corporation receives the Corporate
        Interest under the terms of Article IV of the Agreement, the Owner
        shall not have the right to obtain a loan or advance against the cash
        surrender value of the Policy, or to fully or partially surrender the
        Policy.

8.      The Insurer shall:

        (a)     have no duty or obligation to inquire into or investigate the
                reason or validity of the Corporation's request to exercise
                any of its rights hereunder, or whether the Owner has notice
                of it.  The Insurer may treat any such request by the
                Corporation as an affirmation that the request conforms to
                this Assignment and the Agreement, and is thereby authorized
                to act upon such request;

        (b)     be fully protected in recognizing a request by the Owner to
                exercise any right of ownership, whether or not the
                Corporation has notice of such request including but not
                limited to the right to surrender the Policy.

9.      Upon request, the Corporation shall forward the Policy to the Insurer
        for endorsement of any designation or change of the Policy
        beneficiary, or any election of an optional plan for payment of the
        proceeds.  The Corporation shall forward the Policy for these purposes
        without unreasonable delay.

10.     The exercise of any right given herein to the Corporation, or retained
        by the Owner shall be solely at the option of each party respectively,
        and shall not require notice or consent of one party to the other.

<PAGE>

11.     The Corporation shall release and reassign all of its specific rights
        in the Policy transferred by this Assignment upon repayment of the
        Corporate Interest (as defined in Section 4.3 of the Agreement)
        without unreasonable delay.

12.     The Insurer is not a party to this Assignment.

IN WITNESS WHEREOF, this Assignment is hereby executed this 15th day of
August, 1997.


/s/ James S. Waddell                            /s/ Kenneth E. Edge
---------------------------                     -------------------------
(Witness) James S. Waddell                      (Owner) Kenneth E. Edge