The Markets May 18, 2009

Amcore Cuts Match, Pay, President

Rockford, Illinois-based Amcore Financial is cutting its 401(k) match, executive pay—and a couple of executives.
Reported by

According to the Chicago Tribune, Amcore Financial Inc. reported a $30.4 million first-quarter loss and said it would lay off 9% of its workforce (116 jobs)—including Donald Wilson, Amcore president and chief operating officer, as well as Richard Stiles, executive vice president of commercial banking.

The Rockford-based bank also said it would cut executive salaries by 5%, reduce company contributions to the 401(k) plan, and curtail branch hours.

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Amcore expects the restructuring to result in annual cost savings of $20 million, according to the report.

Compliance May 18, 2009

Bill Would Waive Some 401(k) Withdrawal Penalties

Under proposed legislation, participants undergoing specific financial hardships would get some relief on 401(k) penalties.
Reported by

Congressman Robert Latta (R-Ohio) introduced H. R. 2331, the Individual Recovery Assistance Act of 2009, which waives the 10% penalty on early withdrawals from qualified retirement plans for participants who meet two specific conditions:

  • those who use the funds to make mortgage payments on a primary residence;
  • those who have lost jobs and have received unemployment compensation for 12 consecutive weeks.

These two exceptions would apply for one year, dating from passage of the bill.

The bill would also to increase the age at which distributions from qualified retirement plans are required to begin from 70 1/2 to 75.

The text of H.R. 2331 is online here.

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