Amcore to Take 2d-Quarter Charges Cutting Profit to 6-10 Cents a Share

Amcore Financial Inc.'s second-quarter earnings will be reduced by $3 million to $4 million in nonrecurring charges, but the Rockford, Ill., company still predicts positive earnings.

Amcore said last week that it would take about $1 million in charges for after-tax expenses related to recent acquisitions.

Another $2 million to $3 million in noncash charges will result from the company's early adoption of an accounting rule requiring the revaluation of certain long-term assets.

"As long as you're going to take a hit, you might as well take everything at once," said Mike Milunovich, an analyst at Robert W. Baird, Milwaukee, who follows the company.

The $2.2 billion-asset bank holding company said the charges would reduce second-quarter earnings by 23 cents to 28 cents per share, leaving profit at 6 cents to 10 cents per share.

John Snow, an analyst in the Chicago office of Rodman & Renshaw Inc., cut his 1995 earnings estimate for Amcore to $1.35 per share, from $1.65.

Amcore can move ahead now, he said, adding, "It was a chance to get all the bad news . . . taken care of in a single quarter and move on from there."

The company's stock closed down a quarter point the day of the announcement, at $17.75.

The merger charge is related to recent acquisitions, including that of $170 million-asset NBM Bancorp, Mendota, Ill., which was completed last week.

At the same time, Amcore will take charges for an accounting change that calls for adjusting various assets to their actual worth.

The charges relate to adjusting purchase accounting values assigned to a bank property, certain capitalized costs from data processing conversions, and goodwill and intangibles related to the company's collection agency.

Amcore "saw the (accounting change) coming and thought it would be a favor to the shareholders to let them know what the impact would be," said Ben Rubendall, Amcore's vice president for communications.

Amcore is one of the first financial institutions to make the change, which does not become mandatory until Jan. 1, 1996, Mr. Rubendall said.

Earlier this month, Amcore announced that president and chief executive Carl J. Dargene had been named chairman and would relinquish his other posts at yearend. Executive vice president Robert J. Meuleman will replace Mr. Dargene as president and CEO.

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