EXHIBIT 10.13


                             COVEST BANCSHARES, INC.
                              EMPLOYMENT AGREEMENT


         This AGREEMENT is made effective as of April 27, 1999, by and between
CoVest Bancshares, Inc., a Delaware corporation, (the "Company") and Paul A.
Larsen, ("Executive").

         WHEREAS, the Company desires to employ Paul A. Larsen as the EXECUTIVE
VICE PRESIDENT AND CHIEF FINANCIAL OFFICER of the Company and its subsidiary,
CoVest Banc, National Association (the Bank); and

         WHEREAS, the Executive is willing to commit himself to serving the
Company and the Bank on the terms and conditions herein provided;

         NOW, THEREFORE, in consideration of the mutual covenants herein
contained, and upon the other terms and conditions hereinafter provided, the
parties hereby agree as follows:

         1. POSITION AND RESPONSIBILITIES.

         (a) Executive shall be employed as EXECUTIVE VICE PRESIDENT AND CHIEF
FINANCIAL OFFICER of the Company and of the Bank effective as of the date hereof
for the Period of Employment as defined hereafter. The Executive shall report to
the President and Chief Executive Officer of the Company. The Executive's duties
and responsibilities shall consist of such duties and responsibilities as may
from time to time be assigned to the Executive by the President and Chief
Executive Officer which duties and responsibilities shall be duties customary
for an EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER of the Company or
Bank.

         2. PERIOD OF EMPLOYMENT. The period of the Executive's employment under
this Agreement (the Period of Employment) shall commence upon the Effective Date
hereof and shall continue for a period of twelve (12) full calendar months
thereafter, subject to extension as provided herein or to earlier termination as
provided in Paragraph 4 below. The Period of Employment may be automatically
extended for twelve (12) additional months on each


                                       1
<PAGE>


anniversary date of the Effective date by the Board of the Company or a duly
authorized committee of the Board on behalf of the Company, provided, however,
that in no event shall the Period of Employment extend beyond the date Executive
attains age 65. Notwithstanding anything in this Agreement to the contrary, if
at any time during the Period of Employment there is a Change of Control (as
defined in Paragraph 4), the Period of Employment shall automatically extend to
a date which is the first to occur of (a) the date which is twelve (12) months
from the date of the Change in Control, and (b) the date Executive attains age
65.

         3. COMPENSATION AND REIMBURSEMENT.

         (a) Salary. During the Period of Employment, the Bank shall pay the
Executive the compensation specified in this Agreement for the services
performed hereunder. The Bank shall pay the Executive as compensation a base
salary (Base Salary) of $125,000 per year. The Base Salary shall be subject to
review by the Board and may be increased (but not decreased), whereupon such
increased amount shall become the Base Salary hereunder.

         (b) Bonuses. The Executive shall be eligible for consideration in 1999
and subsequent years for annual incentive bonuses as recommended by the
President and Chief Executive Officer but solely determined by the Board.

         (c) Options. The Company shall grant to the Executive an option to
purchase 30,000 shares of Company common stock as follows: 15,000 shares under
the Company's 1992 Stock Option and Incentive Plan and 15,000 shares under the
Company's 1996 Stock Option and Incentive Plan. Said option shall provide for an
exercise price per share equal to the fair market value on the Effective Date,
and shall vest at a rate of 5,000 shares from each plan commencing February 15,
2000 and each year thereafter with final options under this agreement issuing on
February 15, 2002. The options shall be evidenced by the Option Agreements
attached hereto as Appendix A-1 and Appendix A-2, respectively.

         (d) Vacation; Expense Reimbursement. During the Period of Employment,
the Executive shall be entitled to a paid vacation, periods of absence
occasioned by illness and reasonable leaves of absence, and to expense
reimbursement in accordance with Company policies.


                                       2
<PAGE>


         (e) Benefit Plans. The Executive shall be eligible to participate in or
receive benefits under any benefit plans and arrangements of the Company and
Bank in which Executive officers of the Company and the Bank are generally
entitled to participate including, but not limited to, the profit sharing/401(k)
plan, health-and-accident plans, medical coverage, disability or any other
benefit plans or arrangements, subject to and on a basis consistent with the
terms, conditions and overall administration of such plans and arrangements
applicable to Executive officers of the Company and the Bank generally.

         4. TERMINATION; NOTICE.

         (a) Termination. The Company may terminate the Executive's employment
with the Company and the Bank (and the Period of Employment) at any time, with
or without Cause. The Executive may terminate his employment with the Company
and Bank at any time for any reason.

         (b) Event of Termination. As used in this Agreement, an "Event of
Termination" shall mean:

             (i) the termination by the Company and the Bank of the Executive's
full-time employment hereunder for any reason other than for Cause, death or
Disability, or

             (ii) the voluntary termination by the Executive of employment with
the Company and the Bank within sixty (60) days of a Constructive Discharge; or

             (iii) the voluntary termination by the Executive of employment with
the Company and the Bank within one (1) year after the date of a Change in
Control.

         (c) Severance Benefits. Following the occurrence of an Event of
Termination and only so long as the Executive complies with his obligations
under the Non-Competition Agreement described in Paragraph 6 below, the Bank
shall continue to pay to the Executive, or, in the event of his subsequent
death, his beneficiary or beneficiaries, or his estate, as the case may be, as
severance pay, the Base Salary described in Paragraph 3(a) above and to continue
the medical insurance benefits otherwise provided hereunder for the remainder of
the Period of


                                       3
<PAGE>


Employment, on the same basis as if Executive's employment continued hereunder.

         (d) Cause. The term "for Cause" shall mean termination by the Company
because (i) a material violation by the Executive of any applicable material law
or regulation respecting the business of the Company and its affiliates; (ii)
the Executive's being found guilty of a felony, an act of dishonesty in
connection with the performance of his duties as an officer of the Company or an
affiliate of the Company; or which disqualifies the Executive from serving as an
officer of the Company or an affiliate of the Company; or (iii) the willful or
negligent failure of the Executive to perform his duties hereunder in any
material respect. The Executive shall be entitled to at least thirty days prior
written notice of the Company's intention to terminate his employment for Cause,
specifying the grounds for such termination, a reasonable opportunity to cure
any conduct or act, if curable, alleged as grounds for such termination, and a
reasonable opportunity to present to the Board of Directors of the Company his
position regarding any dispute relating to the existence of Cause for such
termination. In determining willfulness, no act or failure to act on the
Executive's part shall be considered "willful" unless done or omitted to be done
by him not in good faith and without reasonable belief that his action or
omission was in the best interests of the Company or Bank.

         (e) Disability. The term "Disability" shall mean Executive's inability,
as a result of physical or mental incapacity, substantially to perform his
duties hereunder for a period of six (6) months. In the event that it is
reasonably determined that Executive has suffered a Disability, the Company
shall be entitled to terminate his employment. Executive shall be entitled to
compensation and benefits provided for under this Agreement for any period
during the term of this Agreement prior to the establishment of a Disability
during which Executive is unable to work due to a physical or mental disability,
provided that if Executive receives disability income benefits while employed
hereunder, the Company's obligation to pay him salary shall be reduced
accordingly. Notwithstanding anything contained herein to the contrary,
following a period in which Executive is unable substantially to perform his
duties hereunder, until the date specified in a notice of termination relating
to a Disability, the Executive shall be entitled to return to the performance of
his duties hereunder, in which event no Disability shall be deemed to have
occurred. In


                                        4
<PAGE>


addition to such disability income benefits, if any, as are paid to Executive
under a disability benefit plan of the Company following termination of his
employment, the Company shall for a period of one year following such
termination of employment, pay to Executive such amount as, when aggregated with
such disability income benefits, will provide to him the same after tax income
as he would have received if he had remained employed at the same rate of salary
as was payable when his employment was terminated.

         (f) Constructive Discharge. The term "Constructive Discharge" shall
mean the occurrence, other than in connection with a termination by the Company,
of any one of the following events without the Executive's consent:

                  (i) The Executive is removed from the position of EXECUTIVE
         VICE PRESIDENT AND CHIEF FINANCIAL OFFICER of the Company or the Bank,
         other than as a result of the Executive's election or appointment to
         positions of equal or superior scope and responsibility; or

                  (ii) The Executive shall fail to be vested by the Company
         Employer with the powers, authority and support services of such
         position and such failure has not been remedied by the Company within
         thirty (30) days after receipt of written notice of such failure from
         Executive, or

                  (iii) The Company shall fail to pay the compensation and
         benefits required by Paragraph 3 hereof and such failure has not been
         remedied by the Company within thirty (30) days after receipt of
         written notice of such failure from Executive; or

                  (iv) The Company changes the primary employment location of
         the Executive to a place that is more than thirty-five (35) miles from
         Company's principal office as of the Effective Date, or

         (g) Change in Control. For purposes of this Agreement, the term "Change
in Control" shall mean the following:

                  (i) The consummation of the acquisition by any person (as such
         term is defined in Section 13(d) or


                                       5
<PAGE>


         14(d) of the Securities Exchange Act of 1934, as amended (the "1934
         Act")) of beneficial ownership (within the meaning of Rule 13d-3
         promulgated under the 1934 Act) of twenty-five percent (25%) or more of
         the combined voting power of the then outstanding voting securities; or

                  (ii) The individuals who, as of the date hereof, are members
         of the Board of Directors of the Company cease for any reason to
         constitute a majority of such Board members, unless the election, or
         nomination for election by the stockholders, of any new director was
         approved by a vote of a majority of the Board, and such new director
         shall, for purposes of this Agreement, be considered as a member of the
         Board; or

                  (iii) Approval by the stockholders of: (A) a merger or
         consolidation if the stockholders of the Company immediately before
         such merger or consolidation do not, as a result of such merger or
         consolidation, own, directly or indirectly, more than sixty-seven
         percent (67%) of the combined voting power of the then outstanding
         voting securities of the entity resulting from such merger or
         consolidation in substantially the same proportion as their ownership
         of the combined voting power of the voting securities of the Company
         outstanding immediately before such merger or consolidation; or (B) a
         complete liquidation or dissolution or an agreement for the sale or
         other disposition of all or substantially all of the assets of the
         entity.

Notwithstanding the foregoing, a Change in Control shall not be deemed to occur
solely because twenty-five percent (25%) or more of the combined voting power of
the then outstanding securities is acquired by: (1) a trustee or other fiduciary
holding securities under one or more employee benefit plans maintained for
employees of the entity; or (2) any corporation which, immediately prior to such
acquisition, is owned directly or indirectly by the stockholders in the same
proportion as their ownership of stock immediately prior to such acquisition.

         (iv) Notice of Termination. Any termination by the Company or by
Executive shall be communicated by Notice of Termination


                                       6
<PAGE>


to the other party hereto and the termination shall become effective as of the
"Date of Termination" with respect thereto. For purposes of this Agreement, a
"Notice of Termination" shall mean a written notice which shall indicate the
specific termination provision in this Agreement relied upon and shall set forth
in detail the facts and circumstances claimed to provide a basis for the
termination. The "Date of Termination" shall be

                  (i) thirty (30) days after the Notice of Termination is given
         if the Notice of Termination is given by the Company without Cause or
         due to Disability, or by the Executive in the absence of a Constructive
         Discharge; or

                  (ii) the date the Notice of Termination is given if the
         termination is by the Company for Cause; or

                  (iii) thirty (30) days after the Notice of Termination is
         given if the Notice of Termination is given in connection with a
         Constructive Discharge.

         5. INDEMNIFICATION.

         (a) The Company shall provide the Executive (including his heirs,
personal representatives, executors and administrators) for the term of this
Agreement with coverage under any director's and officer's liability insurance
policy which the Company may maintain.

         (b) In addition to such insurance coverage, the Company shall hold
harmless and indemnify the Executive (and his heirs, executors and
administrators) to the fullest extent permitted under applicable law against all
expenses and liabilities reasonably incurred by his in connection with or
arising out of any action, suit or proceeding in which he may be involved by
reason of his having been an officer of the Company or an affiliate of the
Company (whether or not he continues to be an officer at the time of incurring
such expenses or liabilities), such expenses and liabilities to include, but not
be limited to, judgments, court costs and attorneys' fees and the cost of
reasonable settlements.


                                       7
<PAGE>


         (c) In the event the Executive becomes a party, or is threatened to be
made a party, to any action, suit or proceeding for which the Company has agreed
to provide insurance coverage or indemnification under this Paragraph 5, the
Company shall, to the full extent permitted under applicable law, advance all
expenses (including reasonable attorneys' fees), judgements, fines and amounts
paid in settlement (collectively "Expenses") incurred by the Executive in
connection with the investigation, defense, settlement, or appeal of any
threatened, pending or completed action, suit or proceeding, subject to receipt
by the Company of a written undertaking from the Executive : (i) to reimburse
the Company for all Expenses actually paid by the Company to or on behalf of the
Executive in the event it shall be ultimately determined that the Executive is
not entitled to indemnification by the Company for such Expenses; and (ii) to
assign to the Company all rights of the Executive to indemnification, under any
policy of directors' and officers' liability insurance or otherwise, to the
extent of the amount of Expenses actually paid by the Company to or on behalf of
the Executive.

         6. POST-EMPLOYMENT RESTRICTIVE COVENANTS. The Executive's activities
during his employment and following the termination of his employment for any
reason shall be subject to the Agreement Regarding Post-Employment Restrictive
Covenants (the "Non-Competition Agreement") attached hereto as Appendix B.

         7. EFFECT ON PRIOR AGREEMENTS. This Agreement contains the entire
understanding between the parties hereto and supersedes any prior written or
oral understandings and agreements between Executive and the Company.

         8. MODIFICATION AND WAIVER. This Agreement may not be modified or
amended except by an instrument in writing signed by the parties hereto. No term
or condition of this Agreement shall be deemed to have been waived, nor shall
there be any estoppel against the enforcement of any provision of this
Agreement, except by written instrument of the party charged with such waiver or
estoppel. No such written waiver shall be deemed a continuing waiver unless
specifically stated therein, and each such waiver shall operate only as to the
specific term or condition waived and shall not constitute a waiver of such term
or condition for the future as to any act other than that specifically waived.


                                       8
<PAGE>


         9. TAX WITHHOLDING. The Company or Bank may withhold from any amounts
payable to the Executive under this Agreement to satisfy all applicable Federal,
State, local or other withholding taxes. In the event the Company or Bank fails
to withhold such sums for any reason, it may require the Executive to promptly
remit to it sufficient cash to satisfy all applicable income and employment
withholding taxes.

         10. ARBITRATION. Except as expressly set forth elsewhere in this
Agreement or the Non-Competition Agreement, it is mutually agreed between the
parties that arbitration shall be the sole and exclusive remedy to redress any
dispute, claim or controversy (hereinafter referred to as "grievance") involving
the interpretation of this Agreement or the terms or conditions of this
Agreement or the terms, conditions or termination of the Executive's employment
with the Company or Bank. It is the intention of the parties that the
arbitration award shall be final and binding and that a judgment on the award
may be entered in any court of competent jurisdiction and enforcement may be had
according to its terms. Arbitration shall be initiated by one party filing a
written demand on the other party. Any demand for arbitration by the Executive
shall be made within 20 days after receipt of the Notice of Termination. The
arbitrator shall be chosen in accordance with the voluntary labor arbitration
rules of the American Arbitration Association. The place of the arbitration
shall be the offices of the American Arbitration Association in Chicago,
Illinois. The arbitrator shall not have jurisdiction or authority to change any
of the provisions of this Agreement but shall interpret or apply any clause or
clauses of this Agreement. The arbitrator shall have the power to compel the
attendance of witnesses at the hearing. The parties stipulate that the
provisions hereof, and the decision of the arbitrator with respect to any
grievance, shall be the sole and exclusive remedy for any alleged breach of the
employment relationship in which event the Company or Bank shall be entitled to
seek relief in any court having jurisdiction thereof. The parties hereby
acknowledge that subject to the foregoing exception, neither party has the right
to resort to any federal, state or local court or administrative agency
concerning breaches of this Agreement and that the decision of the arbitrator
shall be a complete defense to any suit, action or proceeding instituted in any
federal, state or local court or before any administration agency with respect
to any grievance which is arbitrable as herein set forth. The arbitration
provisions hereof shall, with respect to


                                       9
<PAGE>


any grievance, survive the termination or expiration of the Executive's
employment under this Agreement.

         11. MISCELLANEOUS.

         (a) If, for any reason, any provision of this Agreement, or any part of
any provision, is held invalid, such invalidity shall not affect any other
provision of this Agreement or any part of such provision not held so invalid,
and each such other provision and part thereof shall to the full extent
consistent with law continue in full force and effect.

         (b) The headings of sections and paragraphs herein are included solely
for convenience of reference and shall not control the meaning or interpretation
of any of the provisions of this Agreement.

         (c) To the extent not preempted by Federal law, this Agreement shall be
governed by and construed in accordance with the laws of the State of Illinois.

         (d) Notwithstanding anything herein to the contrary, to the extent that
any compensation or benefits are paid to or received by Executive from the Bank
or any other subsidiary of the Company, such compensation or benefits shall be
deemed to satisfy the Company's obligations hereunder.

         (e) Notices pursuant to this Agreement shall be in writing and shall be
deemed given to any party (i) upon delivery, if delivered personally or by
courier, or (ii) upon dispatch, if transmitted by telecopy or other means of
facsimile, provided a copy thereof is sent by regular mail or courier; or (c)
within forty-eight (48) hours after deposit thereof in U.S. mail, postage
prepaid for delivery as registered or certified mail, return receipt requested
and, if to the Company, addressed to the principal office of the Company,
attention: Chairman; or, if to the Executive, to the address set forth below
the Executive's signature on this Agreement, or to such other address as the
party to be notified shall have given to the other.

         12. SUCCESSORS. This Agreement shall be binding upon and inure to the
benefit of the Company, and its successors and


                                       10
<PAGE>


Executive and his successors and assigns. The Company shall require any
successor or assignee, whether direct or indirect, by purchase, merger,
consolidation or otherwise, expressly and unconditionally to assume and agree to
perform the Company's obligations under this Agreement, in the same manner and
to the same extent that the Company would be required to perform if no such
succession or assignment had taken place.

         IN WITNESS WHEREOF, each of the Company and Bank have caused this
Agreement to be executed by its duly authorized officer and the Executive has
signed this Agreement, effective as of the date first written above.

                                       COVEST BANCSHARES, INC.


                                       By:
                                           -------------------------------------
                                       Its: President & Chief Executive
                                            Officer

                                       COVEST BANC, NATIONAL ASSOCIATION


                                       By:
                                           -------------------------------------
                                       Its: President & Chief Executive
                                            Officer

                                       EXECUTIVE:


                                       -----------------------------------------
                                       Paul A. Larsen

                                       Address:

                                       Telecopy No.:


                                       11