ENDORSEMENT SPLIT DOLLAR
                              INSURANCE AGREEMENT

       THIS ENDORSEMENT SPLIT DOLLAR INSURANCE AGREEMENT (the "Agreement") is
made as of the 10 day of August, 1998, by and between AMCORE FINANCIAL, INC., a
corporation organized under the laws of the State of Nevada (the "Corporation")
and Kenneth E. Edge, John R. Hecht and James S. Waddell residents of Illinois
(the "Employee").

                                  WITNESSETH:

       WHEREAS, the Corporation is a corporation duly organized and validly
       existing under the laws of the State of Nevada, and the Employee is an
       employee of the Corporation; and

       WHEREAS, in consideration of the faithful performance of services by the
       Employee as an employee of the Corporation, the Corporation wishes to
       benefit the Employee by entering into a split-dollar life insurance
       arrangement in accordance with the terms and conditions set forth herein;

       NOW, THEREFORE, the parties mutually agree as follows:

        1. General.  This Agreement describes the terms and conditions of a
split-dollar arrangement between the Corporation and the Employee relating to
that certain life insurance policy (the "Policy"), issued by Canada Life (the
"Insurer") on the life of Kenneth E. Edge in the initial face amount of Three
Million Six Hundred Eighty Two Thousand Four Hundred Forty Two Dollars
($3,682,442), John R. Hecht in the initial face amount of Eight Million One
Hundred Eleven Thousand Five Hundred Twelve Dollars ($8,111,512), James S.
Waddell in the initial face amount of Three Million Six Hundred Eighty Two
Thousand Four Hundred Forty Two Dollars ($3,682,442).

       2. Acquisition of Policy; Payment of Premiums.  The parties shall
cooperate in applying, for and obtaining the Policy.  The Policy shall be issued
to the Corporation as the sole and exclusive owner of the Policy, subject to an
endorsement in favor of the Employee as hereinafter provided.  The Corporation
shall pay all of the net premiums due on the Policy and shall be solely
responsible for the calculation of the economic benefit to the Employee
resulting from its payment of such premiums.

       3. Endorsement.

              (a)    Upon issuance of the Policy, the Corporation and the
Employee shall execute, in form acceptable to the parties and to the Insurer, an
endorsement to the

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Policy in favor of the Employee (the "Endorsement").  The Endorsement shall give
the Employee the right, upon the Employee's death while this Agreement is in
force, to designate the beneficiary (the "Beneficiary") of Policy proceeds equal
to One Million Dollars ($ 1,000,000) (the "Endorsement Amount").  As between the
parties hereto, in the event of any conflict between the terms of the
Endorsement and this Agreement, the terms of this Agreement shall prevail.

              (b)     In no event shall the Endorsement grant to the Employee
the right to surrender the Policy or borrow against the cash surrender value of
the Policy or any other right or power constituting an incident of ownership in
the Policy.  Except for the rights granted to the Employee in the Endorsement,
the Corporation shall have all of the rights of the owner under the Policy and
shall be entitled to exercise all of such rights, options and privileges without
the consent of the Employee.  Without limiting the generality of the foregoing,
the Employee understands and agrees that the cash surrender value of the Policy
shall at all times be the property of the Corporation.

       4.     Death of the Employee. In the event of the Employee's death while
this Agreement is in force, the Corporation and the Beneficiary shall take steps
to collect the proceeds of the Policy by submitting the proper claim forms to
the Insurer.  That portion of the proceeds of the Policy equal to the
Endorsement Amount shall be paid directly to the Beneficiary.  That portion of
the proceeds of the Policy in excess of the Endorsement Amount shall be paid to
the beneficiary designated by the Corporation.

       5.      Termination of Agreement.

              (a)     Subject to fulfillment of the obligations arising upon
termination hereinafter set forth, this Agreement shall terminate on the first
to occur of the following events (each referred to herein as a "Termination
Event"):

                       (i)    delivery of written notice of termination of this
       Agreement by the Corporation to the Employee;

                       (ii)   delivery of written notice of termination of this
       Agreement by the Employees to the Corporation; or

                       (iii)  at the election of the Corporation upon
       termination of the Employee's service as an Employee of the Corporation
       for any reason by either the Corporation or the Employee.

               (b)     Within thirty (30) business days following a Termination
Event, the Corporation, in its sole discretion, shall take one of the following
actions:

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                      (i)     surrender the Policy and collect its cash
       surrender value;

                      (ii)   retain the Policy, whereupon the Corporation may,
       in its sole discretion, substitute a new named insured under the Policy;
       or

                      (iii)   with the consent of the Employee, transfer the
       Policy to the Employee on such terms and conditions as the Corporation
       and the Employee may agree.

               (c)    At any time following a Termination Event, the Corporation
may, without notice to the Employee and without the Employee's consent, cancel
the Endorsement.  In addition, the Employee shall cooperate in effecting any
full or partial policy surrender or policy loan requested by the Corporation in
connection with the Corporation's exercise of any option described under
subparagraph (b) above.

       6.      Provisions Regarding the Insurer. The parties acknowledge and
agree as follows:

               (a)    The Insurer shall be bound only by the provisions of the
Policy and any endorsement thereto.

               (b)    Any payment made or actions taken by the Insurer in
accordance with the provisions of the Policy and any endorsement thereto shall
fully discharge the Insurer from all claims, suits and demands of all persons
whatsoever.

               (c)    The Insurer shall not be deemed a party to, or to have
notice of, this Agreement of the provisions hereof and shall have no obligation
to see to the performance of the obligations of the parties hereunder.

       7.      Disability Waiver of Premiums. The parties may, by mutual
agreement, add an agreement or rider to the Policy providing for the waiver of
premiums in the event of the insured's disability.  Any additional premium
attributable to such agreement or rider shall be payable by the Employee, or in
such other manner as the parties agree.

       8.      Amendment. This Agreement may be altered, amended or modified,
including the addition of any extra policy provisions, but only a written
instrument signed by all of the parties.

       9.      Notice Provision. Each notice and other communication hereunder
shall be in writing and shall be delivered or mailed by registered mail, return
receipt requested, and shall be deemed to have been given on the date of its
delivery, if delivered, and on

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the fifth full business day following the date of the mailing, if mailed to each
of the parties thereto at the following respective addresses or such other
address as may be specified in any notice delivered or mailed as above provided:

              (a)    If to the Corporation:

                     AMCORE FINANCIAL, INC.
                     501 Seventh Street
                     -------------------------
                     Rockford, IL 61104
                     -------------------------


              (b)    If to the Employee:

                     To the address on record with the Payroll Department of the
                     Corporation.

       10.    Assignment. A party may assign such party's interests and
obligations under this Agreement at any time subject to the terms and conditions
of this Agreement.

       11.    Governing Law. This Agreement shall be governed by the laws of the
State of Nevada.

       12.    Entire Agreement. This Agreement sets forth the entire agreement
of the parties with respect to the subject matter hereof.  Any and all prior
agreements or understandings with respect to such matters are hereby superseded.

       13.    ERISA. The parties acknowledge and agree that the split dollar
arrangement described in this Agreement is an "employee welfare benefit plan"
within the meaning of Section 3(l) of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA").

       14.    ERISA Provisions: The following provisions are intended to meet
the requirements of ERISA and shall be interpreted in a manner consistent
therewith:

              (a)     Named Fiduciary. The "Named Fiduciary" is the
Corporation.

              (b)     Claims Procedure. Any person claiming a benefit under the
Agreement (a "Claimant") shall present the claim, in writing, to the
Corporation, and the Corporation shall respond in writing.  If the claim is
denied, the written notice of denial shall state, in a manner calculated to be
understood by the Claimant:

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                     (i)     The specific reason or reasons for denial, with
       specific references to the Agreement provisions on which the denial is
       based;

                     (iii)    A description of any additional material or
       information necessary for the Claimant to perfect his, her or its claim
       and an explanation of why such material or information is necessary; and

                     (iii)   An explanation of the Agreement's claims review
       procedure.

       The written notice denying or granting the Claimant's claim shall be
provided to the Claimant within ninety (90) days after the Corporation's receipt
of the claim, unless special circumstances require an extension of time for
processing the claim.  If such an extension is required, written notice of the
extension shall be furnished by the Corporation to the Claimant within the
initial ninety (90) day period.  Any claim not granted or denied within the
period noted above shall be deemed to have been denied.

       Any Claimant whose claim is denied, or deemed to be denied under the
preceding sentence, or such Claimant's authorized representative, may, within
sixty (60) days after the Claimant's receipt of notice of denial, or after the
date of the deemed denial, request a review of the denial by notice given, in
writing, to the Corporation.  Upon such a request for review, the claim shall be
reviewed by the Corporation (or its designated representative).  In connection
with the review, the Claimant may examine pertinent documents, and may submit
issues and comments in writing.

       The decision on review normally shall be made within sixty (60) days of
the Corporation's receipt of the request for review.  If an extension of time is
required due to special circumstances, the Claimant shall be notified, in
writing, by the Corporation and the time limit for the decision on review shall
be extended to one hundred twenty (120) days.  The decision on review shall be
in writing and shall state, in a manner calculated to be understood by the
Claimant, the specific reasons for the decision and shall include references to
the relevant Agreement provisions on which the decision is based.  The written
decision on review shall be given to the Claimant within the sixty (60) days
(or, if applicable, the one hundred twenty (120) day) period discuss above, the
claim shall be deemed to have been denied upon review.  All decision on review
shall be final and binding with respect to all concerned parties.

       IN WITNESS WHEREOF, the parties have signed this Agreement as of the day
and year first above written.


<PAGE>




                                              AMCORE FINANCIAL, INC.

                                              /s/ James S. Waddell
                                              ---------------------------
                                              James S. Waddell

                                              Its: Executive Vice President and
                                                   Chief Administrative Officer



                                              /s/ John R. Hecht
                                              ---------------------------
                                              John R. Hecht
                                              ---------------------------
                                              Printed Name of Employee



                                              /s/ Kenneth E. Edge
                                              ---------------------------
                                              Kenneth E. Edge
                                              ---------------------------
                                              Printed Name of Employee



                                              /s/ James S. Waddell
                                              ---------------------------
                                              James S. Waddell
                                              ---------------------------
                                              Printed Name of Employee