A planned acquisition by State Financial Services Corp. of Hales Corners, Wis., is raising eyebrows among analysts.

The $828 million-asset banking company said last month that it would buy First Waukegan Corp. in Illinois for $28 million in cash. The deal, which is expected to close in the third quarter, came three months after State Financial bought $386 million-asset Home Bancorp of Elgin (Ill.) for $99 million of stock.

Several analysts said State Financial paid too much for Home Bancorp, a thrift holding company. Their concern now is whether State Financial can absorb both Home and $212 million-asset First Waukegan in one year.

"Whenever you do two deals of this size, there are going to be integration issues," said David Mudd of Howe Barnes Investments in Chicago.

State Financial will be under pressure to improve financial performance at the two companies and to cut costs quickly, he added.

Donna Bembenck, vice president and director of marketing at State Financial Services, said her company is confident of its ability to absorb both Illinois companies efficiently.

State Financial has already moved commercial lenders and investment advisers into Home Federal branches in an effort to transform it into a commercial bank. State Financial also plans to boost First Waukegan's loan- to-deposit ratio, as well as combine the data processing centers of all three companies, Ms. Bembenck said.

"There's a lot of work to be done," she said, "but we look at it as an opportunity. We're going to have to prove ourselves to the marketplace."

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