UNIONBANCAL CORP, S-3/A, 1999-02-01

UNIONBANCAL CORP
S-3/A, 1999-02-01
NATIONAL COMMERCIAL BANKS

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<PAGE>

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 1, 1999

REGISTRATION NOS. 333-67581, 333-67581-01, 333-67581-02, 333-67581-03,
333-67581-04
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------

AMENDMENT NO. 2
TO
FORM S-3

REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
------------------------

<TABLE>
<S> <C> <C>
UNIONBANCAL CORPORATION CALIFORNIA 94-1234979
UNIONBANCAL FINANCE TRUST I DELAWARE 94-3313816
UNIONBANCAL FINANCE TRUST II DELAWARE 94-3313838
UNIONBANCAL FINANCE TRUST III DELAWARE 94-3313845
UNIONBANCAL FINANCE TRUST IV DELAWARE 94-3313846
(Exact name of Registrant as (State or other jurisdiction (I.R.S. Employer
specified in its charter) of incorporation or Identification
organization) No.)
</TABLE>

------------------------

350 CALIFORNIA STREET
SAN FRANCISCO, CALIFORNIA 94104
415-765-2969
(Address, Including Zip Code, and Telephone Number,
Including Area Code, of Registrant's Principal Executive Offices)
------------------------

JOHN H. MCGUCKIN, JR.
EXECUTIVE VICE PRESIDENT
UNIONBANCAL CORPORATION
400 CALIFORNIA STREET
SAN FRANCISCO, CALIFORNIA 94104
415-765-2969
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code,
of Agents for Service)

Copy to:
GREGG A. NOEL
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
300 SOUTH GRAND AVENUE
LOS ANGELES, CALIFORNIA 90071
(213) 687-5000
------------------------

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
FROM TIME TO TIME AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT.
------------------------

If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, check the following
box. / /

If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act,
other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /

If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box: /X/
------------------------

THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON
SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY
DETERMINE.

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- --------------------------------------------------------------------------------
<PAGE>

PROSPECTUS SUPPLEMENT ISSUED JANUARY 29, 1999 (SUBJECT TO COMPLETION)
(TO PROSPECTUS DATED , 1999)

THE INFORMATION IN THIS PROSPECTUS SUPPLEMENT IS NOT COMPLETE AND MAY BE
CHANGED. THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS ARE NOT AN
OFFER TO SELL THESE SECURITIES AND WE ARE NOT SOLICITING OFFERS TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER TO SELL IS NOT PERMITTED.
<PAGE>
$-00,000,000
UNIONBANCAL FINANCE TRUST I
% CAPITAL SECURITIES

GUARANTEED BY

[LOGO]

-----------------

UNIONBANCAL FINANCE TRUST I IS OFFERING CAPITAL SECURITIES THAT UNIONBANCAL
CORPORATION WILL FULLY AND UNCONDITIONALLY GUARANTEE, BASED ON ITS
OBLIGATIONS UNDER A GUARANTEE, A TRUST
DECLARATION AND AN
INDENTURE.

-------------------

THE NEW YORK STOCK EXCHANGE HAS AUTHORIZED THE LISTING OF THE CAPITAL SECURITIES
UNDER THE TRADING SYMBOL "UBT".

-------------------

INVESTING IN THE CAPITAL SECURITIES INVOLVES RISKS. SEE "RISK FACTORS" BEGINNING
ON PAGE S-13.

-------------------

<TABLE>
<CAPTION>
UNDERWRITING PROCEEDS TO
PRICE TO DISCOUNTS UNIONBANCAL
PUBLIC AND COMMISSIONS CORPORATION
--------------------- --------------------- ---------------------
<S> <C> <C> <C>
PER CAPITAL SECURITY...................... $25 $ $
TOTAL..................................... $ $ $
</TABLE>

BECAUSE UNIONBANCAL FINANCE TRUST I WILL USE ALL OF THE PROCEEDS OF THE SALE OF
THE CAPITAL SECURITIES TO PURCHASE THE JUNIOR SUBORDINATED DEBENTURES OF
UNIONBANCAL CORPORATION, UNIONBANCAL CORPORATION WILL PAY ALL UNDERWRITING
DISCOUNTS AND COMMISSIONS. FOR SALES OF 10,000 OR MORE CAPITAL SECURITIES TO A
SINGLE PURCHASER, THE UNDERWRITING COMMISSION WILL BE $ PER CAPITAL SECURITY.
IF YOU PURCHASE CAPITAL SECURITIES AFTER , 1999, YOU SHOULD ADD ANY
ACCUMULATED DISTRIBUTIONS FROM THAT DATE TO THE PRICE TO PUBLIC.

THESE SECURITIES ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF A BANK AND ARE NOT
INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL
AGENCY.

THE SECURITIES AND EXCHANGE COMMISSION AND STATE SECURITIES REGULATORS HAVE NOT
APPROVED OR DISAPPROVED THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS
SUPPLEMENT OR THE ACCOMPANYING PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

UNIONBANCAL FINANCE TRUST I HAS GRANTED THE UNDERWRITERS THE RIGHT TO PURCHASE
UP TO AN ADDITIONAL CAPITAL SECURITIES TO COVER OVER-ALLOTMENTS. THE
UNDERWRITERS EXPECT TO DELIVER THE CAPITAL SECURITIES TO PURCHASERS ON
, 1999.

-------------------

MORGAN STANLEY DEAN WITTER SALOMON SMITH BARNEY

, 1999
<PAGE>
------------------------

TABLE OF CONTENTS

------------------------

<TABLE>
<CAPTION>
PROSPECTUS SUPPLEMENT
<S> <C>
PAGE
----
Prospectus Supplement Summary.................. S-3

Risk Factors................................... S-13

Forward-Looking Statements..................... S-17

UnionBanCal Finance Trust I.................... S-18

The Transactions............................... S-18

Recent Developments............................ S-19

Use of Proceeds................................ S-21

Capitalization................................. S-22

Selected Consolidated Financial and Operating
Data......................................... S-23

Management's Discussion and Analysis of
Financial Condition and Results of
Operations................................... S-26

Business....................................... S-69

Accounting Treatment........................... S-80

Description of the Capital Securities.......... S-80

Description of the Junior Subordinated
Debentures................................... S-89

Description of the Guarantee................... S-95

United States Federal Income Tax
Consequences................................. S-97

ERISA Considerations........................... S-101

Underwriters................................... S-103

Legal Matters.................................. S-104

Index to Consolidated Financial Statements..... F-1
PROSPECTUS
PAGE
----
About This Prospectus.......................... 2

Special Note Regarding Forward-Looking
Statements................................... 2

UnionBanCal Corporation........................

Risk Factors................................... 4

The Trusts..................................... 8

Use of Proceeds................................ 9

Ratio of Earnings to Combined Fixed Charges and
Preferred Stock Dividends.................... 9

Description of Securities...................... 10

Description of Capital Stock................. 10

Description of Depositary Shares............. 11

Description of the Trust Preferred
Securities................................. 13

Description of Debt Securities............... 19

Description of the Trust Preferred Securities
Guarantees................................. 28

Relationship Among the Trust Preferred
Securities, the Trust Preferred Securities
Guarantee and the Debt Securities Held by
Each Trust................................... 31

Plan of Distribution........................... 31

Legal Opinion.................................. 32

Experts........................................ 32

Where You Can Find More Information............ 33
</TABLE>

S-2
<PAGE>
PROSPECTUS SUPPLEMENT SUMMARY

YOU SHOULD READ THE INFORMATION CONTAINED IN THIS PROSPECTUS SUPPLEMENT
CONCERNING UNIONBANCAL CORPORATION, UNIONBANCAL FINANCE TRUST I, OR "FINANCE
TRUST I," THE % CAPITAL SECURITIES TO BE ISSUED BY FINANCE TRUST I, THE
GUARANTEE OF THE CAPITAL SECURITIES TO BE ISSUED BY US AND THE % JUNIOR
SUBORDINATED DEFERRABLE INTEREST DEBENTURES TO BE ISSUED BY US, WITH THE
INFORMATION CONTAINED IN THE ACCOMPANYING PROSPECTUS. WE HAVE RESTATED ALL
FINANCIAL INFORMATION IN THIS PROSPECTUS SUPPLEMENT TO REFLECT THE 3-FOR-1
COMMON STOCK SPLIT THAT OCCURRED IN DECEMBER 1998.

UNIONBANCAL CORPORATION

We are a California-based commercial bank holding company. Our principal
subsidiary is Union Bank of California, N.A., which:

- was formed through the combination of Union Bank and BanCal Tri-State
Corporation in 1996,

- is the third largest commercial bank in California, based on total assets
and total deposits in California,

- is one of the 30 largest banks in the United States,

- is one of the oldest banks on the West Coast, dating back to 1864,

- has customers located primarily in California, the nation's most populous
state, and

- had, at September 30, 1998, 244 full-service branches in California, 6
full-service branches in Oregon and Washington, 2 facilities in Texas and
New York and 18 offices abroad.

At September 30, 1998 we had:

- total assets of $31.4 billion,

- total deposits of $23.7 billion, and

- total shareholders' equity of $3.0 billion.

For the nine months ended September 30, 1998, we had:

- net income of $352.4 million and

- net income per diluted common share of $2.01; net income per diluted
common share is our net income per share if all outstanding stock options,
for which the average market price during the period exceeded the exercise
price, had been converted into common shares.

We are presently approximately 82% owned by The Bank of Tokyo-Mitsubishi, Ltd.

THE STRATEGIC REPOSITIONING

THE TRANSACTIONS.

- The Bank of Tokyo-Mitsubishi is offering to sell approximately $750
million in shares of our common stock to the public.

- We are seeking to repurchase approximately $250 million in shares of our
common stock from The Bank of Tokyo-Mitsubishi.

- We are also seeking to repurchase 2.1 million shares of our common stock
from Meiji Life Insurance Company.

S-3
<PAGE>

- We expect to repurchase the shares of our common stock from The Bank of
Tokyo-Mitsubishi and Meiji Life Insurance Company at the public offering
price on the cover page of this prospectus, less underwriting discounts
and commissions.

- We intend to use the net proceeds of this offering of capital securities
to finance both of the repurchases.

- We anticipate closing all of these transactions in the first quarter of
1999.

EFFECTS OF THE TRANSACTIONS.

These transactions are designed to:

- improve our return on average common equity and earnings per share and to
increase the number of shares available for trading by investors and

- raise proceeds for, and increase the amount of equity capital of, The Bank
of Tokyo-Mitsubishi.

If we had made the repurchases and had completed this offering of capital
securities on January 1, 1997, and everything else had remained the same, we
would have:

- increased our return on average common equity from 16.87% to % at
September 30, 1998 and

- increased our net income per diluted share from $2.30 to $ for the year
ended December 31, 1997 and from $2.01 to $ for the nine months ended
September 30, 1998.

These transactions will not result in a material change to our ratios of
capital to assets by which bank regulators monitor the adequacy of our capital
levels.

THE SELLING SHAREHOLDER--THE BANK OF TOKYO-MITSUBISHI, LTD.

The Bank of Tokyo-Mitsubishi:

- is Japan's largest bank based on total assets,

- has a domestic network of 350 branches, sub-branches and agencies,

- has an overseas network that includes more than 400 facilities, and

- is the majority shareholder of UnionBanCal Corporation, its largest
overseas subsidiary.

The Bank of Tokyo-Mitsubishi has stated that it intends to maintain its
majority stake in UnionBanCal Corporation after the closing of this offering and
the related transactions.

BANKING SERVICES

Our operations are divided into four primary segments:

COMMUNITY BANKING GROUP:

- provides a full line of checking and savings, investment, loan and
fee-based banking products,

- has the fifth largest branch network among depository institutions in
California, and

- had average assets of $10.3 billion and average deposits of $12.3 billion
for the nine months ended September 30, 1998.

S-4
<PAGE>

COMMERCIAL FINANCIAL SERVICES GROUP:

- provides commercial and project loans, real estate financing, commercial
financing based on accounts receivable, inventory, or other short-term
assets, lease financing, customized cash management services, selected
capital markets products and short-term financing of export/import
transactions, including letters of credit and

- had average assets of $12.0 billion and average deposits of $5.8 billion
for the nine months ended September 30, 1998.

TRUST & PRIVATE FINANCIAL SERVICES GROUP:

- provides investment management and administration services for a broad
range of individuals and institutions, including through HighMark Capital
Management, Inc. and its family of proprietary HighMark mutual funds and

- had over $90 billion in assets under administration as of September 30,
1998.

INTERNATIONAL BANKING GROUP:

- provides products and services to financial institutions worldwide,
particularly in Asia, to facilitate financing of export/import
transactions and payments between the parties to those transactions and

- had average assets of $2.1 billion and average deposits of $864 million
for the nine months ended September 30, 1998.

UnionBanCal Corporation reduced cross-border outstanding to Japan, Korea,
Malaysia, Thailand, Vietnam, Singapore, Indonesia, the Philippines, China and
Hong Kong by $1 billion to $1.6 billion at September 30, 1998 compared to $2.6
billion at December 31, 1997, largely related to the International Banking
Group.

OPERATING STRATEGY

Our operating strategy is to:

- capitalize on our strong position in core California market,

- strengthen our consumer banking franchise,

- focus our commercial banking efforts on specific industries and companies,

- diversify our revenue sources and expand our fee-based business,

- emphasize our quality customer service,

- maintain our high lending standards and our strong asset quality profile,

- identify strategic businesses and consider potential acquisitions or
divestitures,

- improve our operating efficiency,

- achieve competitive financial performance targets, and

- align our senior management compensation with shareholders' interests.

S-5
<PAGE>

RECENT DEVELOPMENTS

On January 20, 1999, we announced our financial results for 1998. The audit
of our 1998 financial statements is not yet complete. The following presents
important financial results for 1998:

- Net interest income, on a taxable-equivalent basis, of $1.3 billion,
compared to $1.2 billion in 1997.

- Provision for credit losses of $45.0 million, compared to no provision in
1997.

- Noninterest income of $533.5 million, compared to $463.0 million in 1997.

- Noninterest expense of $1.1 billion, compared to $1.0 billion in 1997.

- Income before taxes, on a taxable-equivalent basis, of $676.0 million,
compared to $655.3 million in 1997.

- Net income of $466.5 million, compared to $411.3 million in 1997.

See "Recent Developments" on page S-19 for a more detailed discussion of our
1998 financial results.

------------------------

Our principal executive offices are located at 350 California Street, San
Francisco, California, 94104, and our telephone number is (415) 765-2969.

UNIONBANCAL FINANCE TRUST I

Finance Trust I is a Delaware business trust. Finance Trust I will exist
solely to:

- issue and sell its common securities to us;

- issue and sell its capital securities to the public;

- use the proceeds from the sale of its common securities and capital
securities to purchase the junior subordinated debentures from us; and

- engage in other activities that are necessary or incidental to these
purposes.

Five trustees will manage Finance Trust I. Three of our officers will act as
regular trustees of Finance Trust I. The First National Bank of Chicago will act
as the property trustee of Finance Trust I, and First Chicago Delaware Inc. will
act as the Delaware trustee of Finance Trust I. The principal offices and
telephone number of Finance Trust I are the same as ours.

S-6
<PAGE>
THE OFFERING

Finance Trust I is offering its capital securities for $25 for each
security. Finance Trust I will use all of the proceeds from the sale of its
capital securities and its common securities to purchase our junior subordinated
debentures. Our junior subordinated debentures will be Finance Trust I's only
assets. We will guarantee the obligations of Finance Trust I under the capital
securities and the common securities under a guarantee, a trust declaration, and
an indenture.

THE CAPITAL SECURITIES

If you purchase capital securities, you will be entitled to receive
cumulative cash distributions at an annual rate of % of the liquidation
amount of $25 per capital security. The liquidation amount is the amount that
you are entitled to receive if UnionBanCal Finance Trust I is terminated and its
assets are distributed to the holders of its securities. You are entitled to
receive the amount from the assets of Finance Trust I available for
distribution, after it has paid liabilities owed to its creditors. Accordingly,
you may not receive the full amount if Finance Trust I does not have enough
funds.

Distributions will accumulate from the date Finance Trust I issues its
capital securities. Finance Trust I will pay the distributions quarterly in
arrears on , , and of each year, beginning
, 1999. These distributions may be deferred, for up to 20
consecutive quarters as described below under "--Deferral of Distributions."
Finance Trust I will only pay distributions when it has funds available for
payment.

If you purchase the capital securities, you will have limited voting rights.
You will be entitled to vote only on two matters: certain modifications to the
terms of the capital securities and the exercise of Finance Trust I's rights as
holder of our junior subordinated debentures.

THE COMMON SECURITIES

We will acquire all of the common securities of Finance Trust I. The common
securities will have an aggregate liquidation amount of approximately 3% of the
total capital of Finance Trust I. The common securities will generally rank
equal to the capital securities in priority of payment. In the case of
distributions, redemptions and liquidations following defaults, however, the
common securities will rank junior to the capital securities. Normally, the
common securities will have sole voting power on matters to be voted upon by
Finance Trust I's security holders.

THE JUNIOR SUBORDINATED DEBENTURES

Finance Trust I will purchase the junior subordinated debentures from us
with the proceeds from the sale of its capital securities and its common
securities. We will issue the junior subordinated debentures under an indenture
between us and The First National Bank of Chicago, as trustee. The junior
subordinated debentures will:

- be unsecured and junior to all of our senior indebtedness, including debt
we incur after the date you purchase the capital securities;

- have an aggregate principal amount equal to the aggregate liquidation
amount of the capital securities plus the capital contributed by us for
the common securities;

- bear interest at an annual rate of %; and

- mature on , 20 - , although they may be redeemed earlier.

GUARANTEE OF THE CAPITAL SECURITIES

We will guarantee the capital securities on a limited basis under the
guarantee.

S-7
<PAGE>

The guarantee requires us to pay accrued and unpaid distributions on the
capital securities on behalf of Finance Trust I only in an amount equal to the
sum of the payments of interest or principal we have made on the junior
subordinated debentures. It does not, however, require us to make payments on
behalf of Finance Trust I if Finance Trust I does not have sufficient funds to
make payments on the capital securities because we have not made payments on the
junior subordinated debentures. With the exception of our obligations under
similar guarantees, our obligations under the guarantee are subordinate to all
of our other obligations.

RANKING

Finance Trust I's capital securities will generally rank equal to its common
securities in priority of payment. Finance Trust I will make payments on the
capital securities and the common securities based on a proportionate
allocation, except after an event of default. For a more detailed explanation,
see "Description of the Capital Securities--Subordination of Common Securities"
on page S-84.

Our junior subordinated debentures will be unsecured and will rank
subordinate and junior in right of payment to all of our current and future
senior indebtedness. The junior subordinated debentures will rank equal to any
other junior subordinated debentures that we may issue.

Our guarantee will rank equal to any other guarantees that we may issue on
capital securities issued by trusts similar to Finance Trust I. The guarantee
will be unsecured and will rank junior in right of payment to all of our other
liabilities. The junior subordinated debentures and the guarantee will be
effectively junior to all existing and future liabilities of our subsidiaries
and affiliates.

DEFERRAL OF DISTRIBUTIONS

We can defer interest payments on the junior subordinated debentures during
any period of up to 20 consecutive quarters, but not beyond the maturity date,
unless we are in default in the payment of interest on the junior subordinated
debentures. After we make all interest payments that we have deferred, including
accrued interest on the deferred payments, we can again defer interest payments
during new periods of up to 20 consecutive quarters as long we adhere to the
same requirements.

If we defer interest payments on the junior subordinated debentures, Finance
Trust I will defer distributions on the capital securities. During any deferral
period, distributions will continue to accumulate on the capital securities at
an annual rate of % of the liquidation amount of $25 per capital security.
Also, the deferred distributions will accrue interest, as permitted by
applicable law, at an annual rate of %.

During any period in which we defer interest payments on the junior
subordinated debentures, we will generally not be permitted to:

- pay dividends or make any other distributions on our capital stock;

- redeem, purchase or make liquidation payments on any of our capital stock;
or

- make an interest, principal or premium payment, or repurchase or redeem,
any of our debt securities that rank equal with or junior to the junior
subordinated debentures or the guarantee, including any other similar
junior subordinated debentures and guarantees issued by us.

If we defer payments of interest on the junior subordinated debentures, the
capital securities would at that time be treated as being issued with original
issue discount for United States federal income tax purposes. This means that
you would be required to include accrued interest in your income for United
States federal income tax purposes before you receive any cash distributions.
Please see "United States Federal Income Tax Consequences" on page S-97 for a
more complete discussion.

S-8
<PAGE>
REDEMPTION OF CAPITAL SECURITIES

Finance Trust I will redeem all of the outstanding capital securities when
we redeem the junior subordinated debentures at maturity on , 20 - .
In addition, if we redeem any junior subordinated debentures before their
maturity, Finance Trust I will use the cash it receives from our redemption to
redeem an equal amount of the capital securities and common securities.

Generally, the aggregate liquidation amount of capital and common securities
to be redeemed will be allocated approximately 97% to the capital securities and
approximately 3% to the common securities.

We can redeem some or all of the junior subordinated debentures before their
maturity at 100% of their principal amount:

- on one or more occasions any time on or after , 2004; and

- before , 2004, if adverse changes in tax, investment company
or bank regulatory law occur (see page S-82).

In either case, we will pay accrued interest to the date of redemption.

DISTRIBUTION OF THE JUNIOR SUBORDINATED DEBENTURES

We have the right to terminate Finance Trust I at any time. If we decide to
exercise our right to terminate Finance Trust I, Finance Trust I will redeem the
capital securities by distributing approximately 97% of the junior subordinated
debentures to holders of the capital securities and approximately 3% to the
holders of the common securities. If the junior subordinated debentures are
distributed, we will use our best efforts to list the junior subordinated
debentures on the New York Stock Exchange or any other exchange on which the
capital securities are then listed.

CONDITIONAL RIGHT TO SHORTEN MATURITY

If adverse changes in tax law occur, we will have the right, prior to the
termination of Finance Trust I, to shorten the maturity of the junior
subordinated debentures. We may only shorten the maturity enough so that the
interest paid on the junior subordinated debentures will continue to be tax
deductible. The shortened term of the junior subordinated debentures may not be
less than 15 years from the date of their original issuance.

USE OF PROCEEDS

Finance Trust I will invest all of the proceeds from the sale of the capital
securities in the junior subordinated debentures. We intend to use the net
proceeds from the sale of the junior subordinated debentures to repurchase $250
million of our common stock from our majority shareholder, The Bank of
Tokyo-Mitsubishi, and 2.1 million shares of our common stock from Meiji Life
Insurance Company and for general corporate purposes.

LISTING OF THE CAPITAL SECURITIES

The New York Stock Exchange has authorized the listing of the capital
securities under the trading symbol "UBT". You should be aware that the listing
of the capital securities will not necessarily ensure that a liquid trading
market will be available for the capital securities.

RISK FACTORS

Your investment in the capital securities will involve risks. You should
carefully consider the following discussion of risks, and the other information
in this prospectus supplement and the accompanying prospectus, before deciding
whether an investment in the capital securities is suitable for you.

S-9
<PAGE>
FORM OF CAPITAL SECURITIES

The capital securities will be represented by one or more global securities
that will be deposited with and registered in the name of The Depository Trust
Company or its nominee. This means that you will not receive a certificate for
your capital securities. Rather, your broker will maintain your position in the
capital securities.

RATINGS

The capital securities are expected to be rated "a2" by Moody's Investors
Service, Inc. and "BBB" by Standard & Poor's Rating Services. These ratings
reflect only the views of the rating agencies, and an explanation of the
significance of such ratings may be obtained only from the rating agencies at
the following addresses:

- Moody's Investors Service, Inc.

99 Church Street
New York, New York 10007

- Standard & Poor's
25 Broadway
New York, New York 10004

We cannot assure that these ratings will remain in effect for any period of
time or that they will not be lowered or withdrawn entirely by the rating
agencies if, in their judgment, circumstances warrant. Neither UnionBanCal
Corporation, Finance Trust I nor the underwriters have taken any responsibility
to oppose any proposed lowering or withdrawal of a rating on the capital
securities. Any lowering or withdrawal of these ratings may adversely affect the
market price of the capital securities.

S-10
<PAGE>

SUMMARY CONSOLIDATED FINANCIAL AND OPERATING DATA

The summary financial and other data as of December 31, 1996 and 1997 and
for the years ended December 31, 1995, 1996 and 1997 are calculated from our
audited consolidated financial statements included in this prospectus. The
summary financial and other data as of December 31, 1995 are calculated from our
audited consolidated financial statements that are not included in this
prospectus. The summary financial and other data as of September 30, 1997 and
1998 and for the nine-month periods ended September 30, 1997 and 1998 are
calculated from our unaudited consolidated financial statements included in this
prospectus, which, in the opinion of our management, include all adjustments
necessary for a fair presentation of our financial position at such date and the
results of operations for such interim periods. The results for the nine-month
period ended September 30, 1998 are not necessarily indicative of the results to
be expected of the full fiscal year.

You should read the following data with the more detailed information
contained in "Selected Consolidated Financial and Operating Data," "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and
our consolidated financial statements and the notes to the consolidated
financial statements, each included in this prospectus.

You should read the following information with the data in the table on the
next page:

- We have presented net interest income and income before income taxes on a
taxable-equivalent basis using the federal statutory tax rate of 35
percent.

- We have annualized return on average assets, return on average common
equity, net interest margin and net loans charged off to average total
loans for the nine-month periods.

- Noninterest expense includes merger and integration expense, which was
$117 million for 1996, $6 million for 1997 and $6 million for the nine
months ended September 30, 1997.

- The efficiency ratio is noninterest expense not including foreclosed asset
expense, or income, as a percentage of the sum of net interest income and
noninterest income.

- The Tier 1 risk-based capital ratio is computed by dividing Tier 1
capital, which is total shareholders' equity less unrealized gain, or
loss, on securities available for sale and intangible assets, by risk
weighted period-end assets. Risk weighted period-end assets is the balance
at risk less the portion of the allowance for credit losses which exceeds
1.25% of the balance at risk. The balance at risk is calculated by
applying risk weight percentages per regulatory guidelines to total assets
and off-balance sheet items.

- The total risk-based capital ratio is total capital, which includes Tier 1
capital, subordinated debt, and 1.25% of the balance at risk, divided by
risk weighted period-end assets.

S-11
<PAGE>

<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEAR ENDED DECEMBER 31, SEPTEMBER 30,
---------------------------------- ----------------------
1995 1996 1997 1997 1998
---------- ---------- ---------- ---------- ----------
(DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C>
RESULTS OF OPERATIONS:
Net interest income................................ $ 1,153 $ 1,175 $ 1,237 $ 917 $ 983
Provision for credit losses........................ 53 40 -- -- 45
Noninterest income................................. 395 419 463 343 400
Noninterest expense................................ 978 1,135 1,045 762 836
---------- ---------- ---------- ---------- ----------
Income before income taxes......................... 517 419 655 498 502
Taxable-equivalent adjustment...................... 11 7 5 4 4
Income tax expense................................. 193 163 239 175 146
---------- ---------- ---------- ---------- ----------
Net income......................................... $ 313 $ 249 $ 411 $ 319 $ 352
---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ----------
NET INCOME APPLICABLE TO COMMON STOCK................ $ 302 $ 238 $ 404 $ 311 $ 352
---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ----------
PER COMMON SHARE:
Net income -- basic................................ $ 1.74 $ 1.37 $ 2.31 $ 1.78 $ 2.01
Net income -- diluted.............................. 1.73 1.36 2.30 1.78 2.01
Common shares outstanding (end of period, in
thousands)......................................... 174,180 174,458 174,918 174,848 175,208
BALANCE SHEET DATA (END OF PERIOD):
Total assets....................................... $ 27,547 $ 29,234 $ 30,585 $ 30,982 $ 31,407
Total loans........................................ 20,432 21,050 22,741 22,298 23,498
Nonperforming assets............................... 247 157 130 133 81
Total deposits..................................... 19,655 21,533 23,296 22,974 23,663
Common equity...................................... 2,349 2,360 2,679 2,615 2,985
OTHER DATA:
Return on average assets........................... 1.22% 0.89% 1.39% 1.45% 1.56%
Return on average common equity.................... 13.73 10.24 16.05 16.85 16.87
Efficiency ratio................................... 63.39 71.02 61.53 60.55 60.51
Net interest margin................................ 5.05 4.75 4.70 4.70 4.86
Tier 1 risk-based capital ratio.................... 9.35 9.08 8.96 8.92 9.53
Total risk-based capital ratio..................... 11.70 11.17 11.05 11.02 11.51
Net loans charged off to average total loans....... 0.32 0.34 0.33 0.28 0.12
Nonperforming assets to total loans and foreclosed
assets........................................... 1.21 0.74 0.57 0.60 0.35
</TABLE>

S-12
<PAGE>
RISK FACTORS

AN INVESTMENT IN THE CAPITAL SECURITIES INVOLVES A NUMBER OF RISKS. YOU
SHOULD CAREFULLY CONSIDER THE FOLLOWING INFORMATION, TOGETHER WITH THE OTHER
INFORMATION IN THIS PROSPECTUS SUPPLEMENT, THE ACCOMPANYING PROSPECTUS AND THE
DOCUMENTS THAT ARE INCORPORATED BY REFERENCE IN THE PROSPECTUS, ABOUT RISKS
CONCERNING THE CAPITAL SECURITIES, BEFORE BUYING ANY CAPITAL SECURITIES.

BECAUSE FINANCE TRUST I WILL RELY ON THE PAYMENTS IT RECEIVES ON THE JUNIOR
SUBORDINATED DEBENTURES TO FUND ALL PAYMENTS ON THE CAPITAL SECURITIES, AND
BECAUSE FINANCE TRUST I MAY DISTRIBUTE THE JUNIOR SUBORDINATED DEBENTURES IN
EXCHANGE FOR THE CAPITAL SECURITIES, YOU ARE MAKING AN INVESTMENT DECISION WITH
REGARD TO THE JUNIOR SUBORDINATED DEBENTURES AS WELL AS THE CAPITAL SECURITIES.
YOU SHOULD CAREFULLY REVIEW THE INFORMATION IN THIS PROSPECTUS SUPPLEMENT AND
THE ACCOMPANYING PROSPECTUS ABOUT BOTH OF THESE SECURITIES AND THE GUARANTEE.

UNIONBANCAL CORPORATION'S OBLIGATIONS UNDER THE GUARANTEE AND THE JUNIOR
SUBORDINATED DEBENTURES WILL BE SUBORDINATED TO OTHER UNIONBANCAL CORPORATION
OBLIGATIONS

Our obligations under the guarantee are unsecured and rank:

- junior in right of payment to all of our other liabilities, unless the
liabilities are expressly made equal to the guarantee, and

- equal to our most senior preferred or preference stock.

Our obligations under the junior subordinated debentures are unsecured and
rank junior in right of payment to all of our senior indebtedness and equal to
our other junior debt securities. The junior subordinated debentures also will
be effectively junior to all obligations of our subsidiaries.

As of September 30, 1998, we had approximately $ - million of senior
indebtedness. The capital securities, the junior subordinated debentures and the
guarantee do not limit our ability to incur additional indebtedness, including
indebtedness that ranks senior to the junior subordinated debentures and the
guarantee. See "Description of the Junior Subordinated
Debentures--Subordination" and "Description of the Guarantee" on pages S-90 and
S-95.

IF UNIONBANCAL CORPORATION DOES NOT MAKE PAYMENTS ON THE JUNIOR SUBORDINATED
DEBENTURES, FINANCE TRUST I WILL NOT BE ABLE TO PAY DISTRIBUTIONS AND OTHER
PAYMENTS ON THE CAPITAL SECURITIES AND THE GUARANTEE WILL NOT APPLY

The ability of Finance Trust I to timely pay amounts due on the capital
securities depends solely upon our making the related payments on the junior
subordinated debentures when due. If we default on our obligation to pay
principal of or interest on the junior subordinated debentures, Finance Trust I
will not have sufficient funds to pay distributions on, or the $25 liquidation
amount of, the capital securities.

In that case, you will not be able to rely upon the guarantee for payment
because the guarantee only applies if we make a payment of principal or interest
on the junior subordinated debentures. Instead, you or the property trustee will
have to sue us to enforce the property trustees rights under the indenture
relating to the junior subordinated debentures.

See "--You May Have to Rely on the Property Trustee to Enforce Your Rights"
immediately below and "Description of the Guarantee" for more information on how
to sue us.

YOU MAY HAVE TO RELY ON THE PROPERTY TRUSTEE TO ENFORCE YOUR RIGHTS

You are not always able to directly enforce rights against us if an event of
default occurs.

If an event of default under the junior subordinated debentures occurs and
is continuing, that event will also be an event of default under the capital
securities. In that case, you would rely on the property trustee, as the holder
of the junior subordinated debentures, to enforce its rights against us.

S-13
<PAGE>

You may only sue us directly in the following circumstances:

- If the holders of a majority in liquidation amount of the capital
securities direct the property trustee to enforce its rights under the
indenture but it does not enforce its rights as directed, you may sue us
directly to enforce the property trustee's rights.

- If the event of default under the trust declaration occurs because of our
failure to pay interest or principal on the junior subordinated
debentures, you may sue us directly.

See "Description of the Capital Securities--Voting Rights" and "Description
of the Junior Subordinated Debentures--Indenture Events of Default" on pages
S-84 and S-94.

DISTRIBUTIONS ON THE CAPITAL SECURITIES COULD BE DEFERRED; YOU MAY HAVE TO
INCLUDE INTEREST IN YOUR TAXABLE INCOME BEFORE YOU RECEIVE CASH

It is possible that you will not receive cash distributions for one or more
periods of up to 20 consecutive quarters each. If this occurs, you will have to
include accrued interest in your income for United States federal income tax
purposes before you actually receive the cash distributions.

As long as we are not in default on the payment of interest on the junior
subordinated debentures, we may defer interest payments on the junior
subordinated debentures one or more times for up to 20 consecutive quarters each
time, but not beyond the maturity date of the junior subordinated debentures.
During a deferral period, Finance Trust I would defer distributions on the
capital securities in a corresponding amount.

If we defer interest payments and Finance Trust I defers distributions on
the capital securities, you will still have to accrue interest income for United
States federal income tax purposes on your proportionate share of the deferred
interest on the junior subordinated debentures.

As a result, you would have to include that accrued interest in your gross
income for United States federal income tax purposes before you actually
received any cash attributable to that income. In addition, you would not
receive the cash related to that income from Finance Trust I if you disposed of
your capital securities before the record date for any deferred distribution,
even if you held the capital securities on the date that the payments would
normally have been paid.

Although we have no current intention of exercising our right to defer
payments of interest, such a deferral may adversely affect the market price of
the capital securities and you may not receive the same return on investment as
someone who continues to hold the capital securities.

See "--General Market Conditions and Deferral Rights Could Adversely Affect
Market Prices," "Description of Capital Securities--Distributions," "Description
of the Junior Subordinated Debentures-- Option to Extend Interest Payment
Period," "United States Federal Income Tax Consequences--Potential Extension of
Interest Payment Period and Original Issue Discount" and "--Sale of Capital
Securities" for more information regarding the interest payment deferment
option.

THE CAPITAL SECURITIES MAY BE REDEEMED IF ADVERSE TAX OR REGULATORY EVENTS OCCUR
OR AT OUR OPTION

If adverse changes in tax, investment company or bank regulatory law
discussed on page S-82 occur and are continuing, we may be able to redeem the
junior subordinated debentures in whole, but not in part, within 90 days
following the occurrence of the event. We may also redeem the capital securities
at our option on or after , 2004. We will not exercise our right of
redemption unless we have received prior approval of the Board of Governors of
the Federal Reserve System to do so, if approval is then required.

If the junior subordinated debentures are redeemed, the capital securities
will be redeemed at a redemption price equal to the $25 liquidation amount, plus
accumulated and unpaid distributions to the

S-14
<PAGE>

redemption date. Under current United States federal income tax law, the
redemption of the capital securities would be a taxable event to you.

See "Description of the Capital Securities--Redemption" and "United States
Federal Income Tax Consequences--Sale of Capital Securities" on pages S-81 and
S-99.

THE JUNIOR SUBORDINATED DEBENTURES MAY BE DISTRIBUTED TO THE HOLDERS OF THE
CAPITAL SECURITIES

Finance Trust I may be terminated before its expiration, either as a result
of the occurrence of adverse tax or regulatory events or at our option. Before
exercising this right, we must receive the prior approval of the Board of
Governors of the Federal Reserve System, if approval is then required. In such
event, and based on the terms of the Amended and Restated Declaration of Trust
of Finance Trust I, the trustee will distribute the junior subordinated
debentures to the holders of the capital securities and the common securities in
liquidation of Finance Trust I.

We cannot predict the market prices for the junior subordinated debentures
that may be distributed. Accordingly, the junior subordinated debentures that
you receive upon a distribution, or the capital securities you hold pending the
distribution, may trade at a lower price than what you paid to purchase the
capital securities.

Although we have agreed to use our best efforts to list the junior
subordinated debentures on the New York Stock Exchange or any other exchange on
which the capital securities are then listed if this occurs, we cannot assure
you that the New York Stock Exchange will approve the junior subordinated
debentures for listing or that a trading market will exist for the junior
subordinated debentures.

Under current United States federal income tax law, the distribution of
junior subordinated debentures upon the termination of Finance Trust I would
generally not be taxable to you. If, however, Finance Trust I is characterized
for United States federal income tax purposes as an association taxable as a
corporation at the time of the liquidation, the distribution of the junior
subordinated debentures would be taxable to you.

Please see "Description of Trust Preferred Securities--Liquidation
Distribution Upon Dissolution" on page 15 of the accompanying prospectus for
more information.

UNIONBANCAL CORPORATION MAY SHORTEN MATURITY OF JUNIOR SUBORDINATED DEBENTURES,
WHICH WILL RESULT IN EARLY REDEMPTION OF THE CAPITAL SECURITIES

Upon the occurrence and continuation of adverse tax events as explained in
"Description of the Junior Subordinated Debentures--Option to Accelerate
Maturity Date," we may, instead of redeeming the junior subordinated debentures,
shorten the stated maturity of the junior subordinated debentures to as early as
, 2014. In that event, the mandatory redemption date for the capital
securities will be correspondingly shortened.

We will only exercise this right upon receiving prior approval of the Board
of Governors of the Federal Reserve System, if then required.

See "Description of the Junior Subordinated Debentures--Option to Accelerate
Maturity Date" on page S-93.

THE MARKET PRICES OF THE CAPITAL SECURITIES MAY NOT FULLY REFLECT ACCRUED
INTEREST

The capital securities may trade at prices that do not fully reflect the
value of accrued but unpaid interest on the underlying junior subordinated
debentures.

If you dispose of your capital securities between record dates for any
distribution payments, you will still have to include as ordinary income for
United States federal income tax purposes an amount equal to

S-15
<PAGE>

the accrued but unpaid interest on your proportionate share of the interest on
the junior subordinated debentures through the date of your disposition.

You will recognize a capital loss on the amount that the selling price is
less than your adjusted tax basis. Normally, you may not apply capital losses to
offset ordinary income for United States federal income tax purposes.

See "United States Federal Income Tax Consequences--Sale of Capital
Securities" on page S-99 for more information.

VOTING RIGHTS OF CAPITAL SECURITY HOLDERS ARE VERY LIMITED

You will have limited voting rights. In general, only UnionBanCal
Corporation, as the sole holder of the common securities of Finance Trust I, can
replace or remove any of the trustees of Finance Trust I.

UnionBanCal Corporation and the regular trustees, who are officers of
UnionBanCal Corporation, may amend the trust declaration without the consent of
holders of capital securities as described on page 18 under "Description of the
Trust Preferred Securities--Voting Rights; Amendment of Declarations" in the
accompanying prospectus.

AN ACTIVE TRADING MARKET FOR THE CAPITAL SECURITIES MAY NOT DEVELOP

The capital securities constitute a new issue of securities with no
established trading market. Although the capital securities will be listed on
the New York Stock Exchange, a listing does not guarantee that a trading market
for the capital securities will develop or, if a trading market for the capital
securities does develop, the depth of that market and the ability of holders to
sell their capital securities easily.

ADVERSE FACTORS COULD IMPACT OUR ABILITY TO ATTAIN OUR LONG-TERM FINANCIAL
PERFORMANCE GOALS

In connection with our strategic repositioning, we have developed long-term
financial performance goals, which we expect to result from the successful
implementation of our operating strategies. We cannot assure you that we will be
successful in achieving these long-term goals or that our operating strategies
will be successful. Achieving success in these areas is dependent upon a number
of factors, many of which are beyond our direct control. Factors that may
adversely affect our ability to attain our long-term financial performance goals
include:

- deterioration of our asset quality;

- our inability to reduce non-interest expenses;

- our inability to increase non-interest income;

- our inability to decrease reliance on asset revenues;

- regulatory and other impediments associated with making acquisitions;

- deterioration in general economic conditions, especially in our core
markets;

- decreases in net interest rate margins;

- increases in competition;

- adverse regulatory developments;

- unexpected increased costs related to any potential acquisitions;

- unexpected increased costs associated with implementation of the
efficiency improvement project; and

- unavailability of stock to repurchase at acceptable prices.

S-16
<PAGE>

FAILURE TO COMPLETE ANY OF THE TRANSACTIONS COULD RESULT IN FEWER BENEFITS TO US

Although we and The Bank of Tokyo-Mitsubishi intend to complete this
offering, the common stock offering, and the repurchases of our common stock
from The Bank of Tokyo-Mitsubishi and Meiji Life Insurance Company during the
first quarter of 1999, these transactions may not occur. The common stock
offering and the repurchases are dependent upon each other. Accordingly, if the
common stock offering does not occur, then the parties to the repurchases are
not required to complete the repurchases. Similarly, if either of the
repurchases does not occur, then the parties to the common stock offering are
not required to complete that offering.

Finance Trust I will use the proceeds from this offering to purchase junior
subordinated debentures from us. We intend to use the proceeds from the sale of
the junior subordinated debentures mainly to repurchase the shares of our common
stock in the repurchases. Therefore, if this offering does not occur, we may not
have sufficient funds to complete the repurchases, which could cause the common
stock offering to be terminated. If this offering is completed but the
repurchases are not, we may have excess unused proceeds from the sale of the
junior subordinated debentures. If any of the transactions does not occur, we
would not recognize the anticipated benefits of the transactions as a whole.

FORWARD-LOOKING STATEMENTS

This prospectus supplement and the accompanying prospectus and the
information incorporated by reference includes forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, and Section 21E of the
Securities Exchange Act. The discussion on page S-79 regarding our intention to
attain new financial performance targets and to improve our operating efficiency
are forward-looking statements. In addition some of the forward-looking
statements can be identified by the use of forward-looking words such as
"believes," "expects," "may," "will," "should," "seeks," "approximately,"
"intends," "plans," "estimates," or "anticipates" or the negative of those words
or other comparable terminology. Forward-looking statements involve inherent
risks and uncertainties. A number of important factors could cause actual
results to differ materially from those in the forward-looking statements. Some
factors include fluctuations in interest rates, inflation, government
regulations, and economic conditions and competition in the geographic and
business areas in which we conduct our operations. For a discussion of factors
that could cause actual results to differ, please see the discussion under "Risk
Factors" contained in this prospectus supplement, the accompanying prospectus
and in other information contained in our publicly available SEC filings.

S-17
<PAGE>
UNIONBANCAL FINANCE TRUST I

Finance Trust I is a statutory business trust formed under Delaware law by:

- the execution of a trust declaration by UnionBanCal Corporation, as
sponsor, and the trustees of Finance Trust I and

- the filing of a certificate of trust with the Secretary of State of the
State of Delaware.

The capital securities offered hereby will constitute all of the capital
securities of Finance Trust I, and we will acquire all of the common securities
of Finance Trust I, which have an aggregate liquidation amount equal to
approximately 3% of the total capital of Finance Trust I.

We will pay all fees and expenses related to Finance Trust I and the
offering of the common securities and the capital securities.

THE TRANSACTIONS

Finance Trust I is offering to sell $ million of capital securities and to
use the proceeds to buy junior subordinated debentures from us. We expect to use
the proceeds from the sale of the junior subordinated debentures to repurchase
shares of our common stock from two existing shareholders. We expect to
repurchase $250 million in shares of our common stock from The Bank of
Tokyo-Mitsubishi, and 2.1 million shares of our common stock from Meiji Life
Insurance Company. At the same time, The Bank of Tokyo-Mitsubishi is offering to
sell $750 million in shares of our common stock to the public. We expect to
repurchase the shares from The Bank of Tokyo-Mitsubishi and Meiji Life Insurance
Company at the public offering price in the common stock offering, less the
underwriting discounts and commissions. We anticipate closing these transactions
in the first quarter of 1999.

These transactions are designed to:

- improve our return on average common equity and earnings per share and to
increase the number of shares available for trading by investors

- raise proceeds for, and increase the amount of equity capital of, The Bank
of Tokyo-Mitsubishi.

If we had made the repurchases and had completed this offering of capital
securities on January 1, 1997, and everything else had remained the same, we
would have:

- increased our return on average common equity from 16.87% to % at
September 30, 1998; and

- increased our net income per diluted common share from $2.30 to $ for
the year ended December 31, 1997 and from $2.01 to $ for the nine
months ended September 30, 1998; net income per diluted common share is
our net income per share if all outstanding stock options, for which the
average market price during the period excceded the exercise price, had
been converted into common shares.

We believe these transactions will provide us with additional benefits. They
should increase the level of market research coverage we receive from equity
analysts and should make it easier for us to use shares of our common stock to
pay for acquisitions.

These transactions will not result in a material change to our ratios of
capital to assets by which bank regulators monitor the adequacy of our capital
levels.

S-18
<PAGE>

RECENT DEVELOPMENTS

On January 20, 1999, we announced our financial results for 1998. The audit
of our 1998 financial statements is not yet complete. The following table
presents important financial results for 1997 and 1998.

<TABLE>
<CAPTION>
AS OF AND FOR THE YEAR ENDED
DECEMBER 31,
----------------------------
1997 1998
------------- -------------
(DOLLARS IN THOUSANDS)
(UNAUDITED)
<S> <C> <C>
RESULTS OF OPERATIONS:
Net interest income, on a taxable-equivalent basis............................... $ 1,237,010 $ 1,322,655
Provision for credit losses...................................................... -- 45,000
Noninterest income............................................................... 463,001 533,531
Noninterest expense.............................................................. 1,044,665 1,135,218
Income before taxes, on a taxable-equivalent basis............................... 655,346 675,968
Net income....................................................................... 411,296 466,461
BALANCE SHEET DATA (END OF PERIOD):
Total assets..................................................................... 30,585,265 32,276,316
Total loans...................................................................... 22,741,408 24,296,111
Total deposits................................................................... 23,296,374 24,507,879
Common equity.................................................................... 2,679,299 3,058,244
</TABLE>

- - Net income was $466.5 million in 1998, or $2.65 per diluted common share. In
1997, net income was $411.3 million, and net income applicable to common stock
was $403.7 million, or $2.30 per diluted common share.

- Excluding a tax benefit of $60.2 million related to a reduction in
California state franchise taxes, which arises from our filing a worldwide
unitary tax return with The Bank of Tokyo-Mitsubishi, net income for 1998
was $406.3 million, or $2.31 per diluted common share.

- Excluding an after-tax refund from the California Franchise Tax Board
received in the third quarter of 1997, net income applicable to common
stock in 1997 was $379.0 million, or $2.16 per diluted common share.

- - For 1998, return on average assets was 1.53 percent and return on average
common equity was 16.39 percent compared to 1.39 percent for return on average
assets and 16.05 percent for return on average common equity for 1997.

- - Net interest income, on a taxable-equivalent basis, increased 6.9 percent to
$1.3 billion in 1998, primarily due to a $1.2 billion, or 4.5 percent,
increase in average earning assets, resulting primarily from a $1.4 billion,
or 6.2 percent, increase in average loans.

- - Net interest margin in 1998 was 4.81 percent, up from 4.70 percent in 1997.
The increase in net interest margin was primarily due to a $1.1 billion, or
14.7 percent, increase in average noninterest bearing deposits, which funded a
significant portion of the growth in average loans.

- - Noninterest income in 1998 was $533.5 million, up $70.5 million, or 15.2
percent, from 1997.

- Service charges on deposit accounts grew $24.2 million, or 21.1 percent,
reflecting strong growth in deposit balances and an expansion of products
and services.

- Trust and investment management fees increased $13.7 million, or 12.7
percent, on strong growth in trust accounts and assets under management.

- International fees and commissions increased $5.9 million, or 8.9 percent.

S-19
<PAGE>

- Other noninterest income increased $26.7 million in 1998, primarily due to
a $17.1 million gain from the sale of the credit card portfolio in second
quarter 1998.

- - Noninterest expense was $1.1 billion in 1998, up $90.6 million, or 8.7
percent, from 1997. Personnel-related expenses increased $45.9 million, or 8.0
percent, primarily due to higher performance-based incentive compensation and
regular merit increases. Other noninterest expense increased $40.8 million, or
12.3 percent, comprised primarily of:

- an $8.7 million increase in professional fees due to additional costs
related to the year 2000 initiative,

- an increase of $8.3 million in expenses incurred to support higher deposit
volumes,

- an increase of $8.2 million in other outside service expenses, and

- an increase of $3.2 million in marketing expenses.

- - The 1998 effective tax rate was 30.5 percent, compared with 36.7 percent for
1997. The primary reason for the lower 1998 effective tax rate was the filing
of our 1997, and our intention to file our 1998, California franchise tax
returns on a worldwide unitary basis, which incorporates the results of The
Bank of Tokyo-Mitsubishi and its worldwide affiliates.

- The reductions in income tax expense related to the unitary filings for
1998 were approximately $60.2 million.

- The effective tax rate for 1997 was favorably affected by an after-tax
refund of $24.7 million from the California Franchise Tax Board for tax
years 1975-1987.

- Excluding the state tax reduction in 1998 and the California Franchise Tax
Board refund in 1997, the effective tax rate for 1998 would have been 39.5
percent and 40.5 percent for 1997.

- - Nonperforming assets at December 31, 1998 were $89.9 million, down $40.0
million, or 30.8 percent, from December 31, 1997. Nonperforming assets were
0.28 percent of total assets on December 31, 1998, down from 0.42 percent from
a year earlier.

- - Net loans charged off as a percentage of average total loans were 0.15 percent
in 1998 down from 0.33 percent in 1997.

- - The provision for credit losses for 1998 was $45.0 million, compared to no
provision made for full year 1997.

- The provision for credit losses is charged to income to bring the
allowance for credit losses to a level deemed appropriate by management
based on the various factors that are used to determine the adequacy of
the allowance based on losses inherent in the loan and lease portfolio.

- At December 31, 1998, the allowance for credit losses as a percent of
total loans was 1.89 percent and as a percent of nonaccrual loans was
585.5 percent. These ratios compare with 1.99 percent and 413.1 percent at
December 31, 1997.

S-20
<PAGE>
USE OF PROCEEDS

Finance Trust I will use all of the proceeds received from the sale of the
capital securities to purchase junior subordinated debentures from us. We will
use the net proceeds from the sale of the junior subordinated debentures, after
deducting estimated expenses of $ and underwriting discounts and
commissions in respect of the sale of the capital securities, to repurchase
shares of our common stock and for general corporate purposes.

We are required by the Board of Governors of the Federal Reserve System to
maintain minimum capital levels for bank regulatory purposes. On October 21,
1996, the Federal Reserve announced that long-term cumulative capital securities
having the characteristics of the capital securities could be included as Tier 1
capital for bank holding companies. This Tier 1 capital treatment, together with
our ability to deduct, for United States federal income tax purposes, interest
payable on the junior subordinated debentures, will provide us with a more
cost-effective means of obtaining capital for regulatory purposes than other
Tier 1 capital alternatives currently available to us.

S-21
<PAGE>
CAPITALIZATION

The following table presents our short-term debt and total capitalization on
a consolidated basis at September 30, 1998. The "As Adjusted for The
Transactions" column presents our capitalization at September 30, 1998, as if
this offering, the offering of the common stock by The Bank of Tokyo-Mitsubishi
and the repurchase of shares of our common stock from The Bank of
Tokyo-Mitsubishi and Meiji Life Insurance Company had already occurred.

<TABLE>
<CAPTION>
SEPTEMBER 30, 1998
------------------------------
AS ADJUSTED
FOR
ACTUAL THE TRANSACTIONS
------------
(UNAUDITED)
(IN THOUSANDS)
<S> <C> <C>
Short-term debt:
Federal funds purchased and securities sold under repurchase agreements......... $ 1,574,163 $
Commercial paper................................................................ 1,417,077
Other borrowed funds............................................................ 339,340
------------ ----------------
Total short-term debt....................................................... $ 3,330,580 $
------------ ----------------
------------ ----------------

Long-term debt:
UnionBanCal Corporation-obligated mandatorily redeemable preferred securities of
subsidiary grantor trust(1)................................................... $ -- $
Subordinated capital notes...................................................... 298,000
------------ ----------------
Total long-term debt........................................................ 298,000
------------ ----------------

Shareholders' equity:
Preferred stock, 5,000,000 shares authorized, none outstanding.................. --

Common stock, 300,000,000 shares authorized, 175,208,037 shares outstanding..... 292,013
Additional paid-in capital...................................................... 1,430,539
Retained earnings............................................................... 1,233,068
Accumulated other comprehensive income.......................................... 29,330
------------ ----------------
Total shareholders' equity.................................................. 2,984,950
------------ ----------------
Total capitalization...................................................... $ 3,282,950 $
------------ ----------------
------------ ----------------

Tier 1 risk-based capital ratio................................................... 9.53%
Total risk-based capital ratio.................................................... 11.51
Return on average common equity ratio............................................. 16.87
</TABLE>

- ------------------------

(1) The sole asset of the subsidiary trust is the $ aggregate principal
amount of the junior subordinated debentures.

S-22
<PAGE>
SELECTED CONSOLIDATED FINANCIAL AND OPERATING DATA

The selected financial and other data as of December 31, 1996 and 1997 and
for the years ended December 31, 1995, 1996 and 1997 are calculated from our
audited consolidated financial statements included in this prospectus. The
selected financial and other data for the year ending December 31, 1994 and as
of December 31, 1995 are calculated from our audited consolidated financial
statements that are not included in this prospectus. The selected financial and
other data as of December 31, 1993 and 1994 and for the year ended December 31,
1993 are calculated from the combined historical financial information of Union
Bank and BanCal Tri-State Corporation and its banking subsidiary, The Bank of
California, N.A. Such combined historical information was, in turn, calculated
from the separate audited consolidated financial statements of Union Bank and
BanCal Tri-State for those periods that are not included in this prospectus. The
selected financial and other data as of September 30, 1997 and 1998 and for the
nine-month periods ended September 30, 1997 and 1998 are calculated from our
unaudited consolidated financial statements included in this prospectus, which,
in the opinion of our management, include all adjustments necessary for a fair
presentation of our financial position at such date and the results of
operations for such interim period. The results for the nine-month period ended
September 30, 1998 are not necessarily indicative of the results to be expected
of the full fiscal year.

We have presented all historical financial information as if the combination
of Union Bank with BanCal Tri-State Corporation and its banking subsidiary, The
Bank of California, N.A., which occurred on April 1, 1996, had been in effect
for all periods presented.

You should read the following data with the more detailed information
contained in "Management's Discussion and Analysis of Financial Condition and
Results of Operations" and our consolidated financial statements and the notes
to the consolidated financial statements, each included in this prospectus.

You should read the following information with the data in the table on the
next page:

- We have presented net interest income and income before income taxes on a
taxable-equivalent basis using the federal statutory tax rate of 35
percent.

- We have annualized return on average assets, return on average common
equity, net interest margin and net loans charged off to average total
loans for the nine-month periods.

- The total risk-based capital ratio is total capital, which includes Tier 1
capital, subordinated debt, and 1.25% of the balance at risk, divided by
risk weighted period-end assets.

S-23
<PAGE>

<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEAR ENDED DECEMBER 31, SEPTEMBER 30
--------------------------------------------------------- --------------------
1993 1994 1995 1996 1997 1997 1998
--------- --------- ------------- --------- --------- --------- ---------
(DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
RESULTS OF OPERATIONS:
Net interest income............................ $ 986 $ 1,008 $ 1,153 $ 1,175 $ 1,237 $ 917 $ 983
Provision for credit losses.................... 151 73 53 40 -- -- 45
Noninterest income............................. 406 360 395 419 463 343 400
Noninterest expense(1)......................... 1,055 1,037 978 1,135 1,045 762 836
--------- --------- ------------- --------- --------- --------- ---------
Income before income taxes and cumulative
effect of accounting change.................... 186 258 517 419 655 498 502
Taxable-equivalent adjustment.................. 15 13 11 7 5 4 4
Income tax expense............................. 64 120 193 163 239 175 146
--------- --------- ------------- --------- --------- --------- ---------
Income before cumulative effect of accounting
change......................................... 107 125 313 249 411 319 352
Cumulative effect of accounting change(2)...... 193 -- -- -- -- -- --
--------- --------- ------------- --------- --------- --------- ---------
Net income..................................... $ 300 $ 125 $ 313 $ 249 $ 411 $ 319 $ 352
--------- --------- ------------- --------- --------- --------- ---------
--------- --------- ------------- --------- --------- --------- ---------
NET INCOME APPLICABLE TO COMMON STOCK............ $ 289 $ 114 $ 302 $ 238 $ 404 $ 311 $ 352
--------- --------- ------------- --------- --------- --------- ---------
--------- --------- ------------- --------- --------- --------- ---------
PER COMMON SHARE:(3)
Net income -- basic............................ $ 1.73 $ 0.67 $ 1.74 $ 1.37 $ 2.31 $ 1.78 $ 2.01
Net income -- diluted.......................... 1.73 0.67 1.73 1.36 2.30 1.78 2.01
Pro forma earnings -- basic, excluding after
tax merger and integration expense and
cumulative effect of accounting change(1).... 0.58 0.67 1.74 1.78 2.33 1.80 2.01
Pro forma earnings -- diluted, excluding after
tax merger and integration expense and
cumulative effect of accounting change(1).... 0.58 0.67 1.73 1.77 2.32 1.80 2.01
Dividends(4)................................... 0.47 0.47 0.47 0.47 0.51 0.37 0.42
Book value (end of period)..................... 11.64 11.88 13.49 13.53 15.32 14.96 17.04
Common shares outstanding (end of period, in
thousands)................................... 169,990 172,044 174,180 174,458 174,918 174,848 175,208
Weighted average common shares outstanding --
basic........................................ 166,857 171,089 173,806 174,391 174,683 174,615 175,091
Weighted average common shares outstanding --
diluted...................................... 166,917 171,150 174,099 174,784 175,189 175,071 175,729
BALANCE SHEET DATA (END OF PERIOD):
Total assets................................... $ 24,006 $ 24,569 $ 27,547 $ 29,234 $ 30,585 $ 30,982 $ 31,407
Total loans.................................... 17,759 18,066 20,432 21,050 22,741 22,298 23,498
Nonperforming assets........................... 1,193 421 247 157 130 133 81
Total deposits................................. 16,978 17,410 19,655 21,533 23,296 22,974 23,663
Subordinated capital notes..................... 726 656 501 382 348 382 298
Preferred stock................................ 135 135 135 135 -- -- --
Common equity.................................. 1,978 2,044 2,349 2,360 2,679 2,615 2,985
BALANCE SHEET DATA (PERIOD AVERAGE):
Total assets................................... $ 23,927 $ 23,693 $ 25,565 $ 27,900 $ 29,693 $ 29,452 $ 30,131
Total loans.................................... 18,219 17,616 18,975 20,728 21,856 21,693 22,917
Earning assets................................. 21,176 21,047 22,849 24,717 26,292 26,066 27,003
Total deposits................................. 17,160 16,826 17,970 20,102 22,067 21,824 22,386
Common equity.................................. 1,918 1,981 2,197 2,325 2,515 2,470 2,793
</TABLE>

S-24
<PAGE>

- --------------------------

(1) Merger and integration expense included in noninterest expense was $117
million for 1996 and $6 million for 1997, and after-tax merger and
integration expense was $72 million for 1996 and $4 million for 1997. Merger
and integration expense was $6 million ($4 million after-tax) for the nine
months ended September 30, 1997. "Pro forma" means that the amounts
presented do not include the effects of the cumulative change in accounting
and merger and integration expense for the period presented. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations--Year Ended December 31, 1997 Compared to Year Ended December 31,
1996" for a description of merger accounting and pro forma presentations.

(2) 1993 net income includes the cumulative effect of the adoption of Statement
of Financial Accounting Standards No. 109, "Accounting for Income Taxes."

(3) Amounts have been restated to give retroactive effect to the December 1998
3-for-1 stock split.

(4) Dividends per share reflect dividends declared on our common stock
outstanding as of the declaration date. Amounts prior to the merger on April
1, 1996 are based on Union Bank only and do not include the dividend of $145
million paid to The Mitsubishi Bank, Limited in the first quarter of 1996 by
BanCal Tri-State Corporation and The Bank of California, N.A.

(5) The efficiency ratio is noninterest expense, excluding foreclosed asset
expense (income), as a percentage of net interest income
(taxable-equivalent) and noninterest income. Foreclosed asset expense
(income) was $123.3 million for the year ended 1993, $73.7 million for the
year ended 1994, $(3.2) million for the year ended 1995, $2.9 million for
the year ended 1996 and $(1.3) million for the year ended 1997. For the nine
months ended September 30, 1997 and 1998, foreclosed asset expense (income)
was $(0.7) million in each period.

S-25
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

YOU SHOULD READ THE FOLLOWING DISCUSSION AND ANALYSIS OF OUR FINANCIAL
CONDITION AND THE RESULTS OF OUR OPERATIONS WITH OUR FINANCIAL STATEMENTS AND
THE NOTES TO THOSE FINANCIAL STATEMENTS INCLUDED IN THIS PROSPECTUS. AMOUNTS FOR
PRIOR PERIODS HAVE BEEN RECLASSIFIED TO CONFORM TO CURRENT FINANCIAL STATEMENT
PRESENTATION AS INDICATED BELOW.

INTRODUCTION

We are a California-based commercial bank holding company with consolidated
assets of $31.4 billion at September 30, 1998. Based on total assets,
UnionBanCal Corporation, together with its consolidated subsidiaries, was the
third largest bank holding company in California and among the 30 largest in the
United States. At September 30, 1998, we operated 244 full-service branches in
California, six banking offices in Oregon and Washington, and 18 overseas
facilities.

The combination of Union Bank with BanCal Tri-State Corporation and its
banking subsidiary, The Bank of California, N.A., was completed on April 1, 1996
(the "Merger"), resulting in UnionBanCal Corporation and its banking subsidiary,
Union Bank of California, N.A. The combination was accounted for as a
reorganization of entities under common control, similar to a pooling of
interests. Accordingly, all historical financial information has been restated
as if the combination had been in effect for all periods presented.

On August 10, 1998, UnionBanCal Corporation and its consolidated
subsidiaries exchanged 10.2 million shares of its common stock for the 7.2
million shares of the common stock of Union Bank of California, N.A. owned
directly by The Bank of Tokyo-Mitsubishi, Ltd. This share exchange provided
UnionBanCal Corporation with a 100 percent ownership interest in Union Bank of
California, N.A. In addition, it increased The Bank of Tokyo-Mitsubishi's
ownership percentage of UnionBanCal Corporation to 82 percent from 81 percent.

The exchange of shares was accounted for as a reorganization of entities
under common control. Accordingly, amounts previously reported as "Parent Direct
Interest in Bank Subsidiary," including the proportionate share of net income,
dividends, and other comprehensive income, have been reclassified to combine
them with the corresponding amounts attributable to our common shareholders for
all periods presented.

On November 18, 1998, our Board of Directors approved the declaration of a
3-for-1 stock split effective for shareholders of record on December 7, 1998.
Accordingly, all historical financial information has been restated as if the
stock split had been in effect for all periods presented.

NINE MONTHS ENDED SEPTEMBER 30, 1998 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30,
1997

SUMMARY

Net income for the first nine months of 1998 was $352.4 million, compared to
$318.9 million for the first nine months of 1997. Net income applicable to
common stock was $352.4 million, or $2.01 per diluted common share, for the
first nine months of 1998, compared with $311.3 million, or $1.78 per diluted
common share, for the first nine months of 1997. Excluding the tax benefit of
$52.4 million, net of federal tax, recorded in the first nine months of 1998,
net income applicable to common stock was $299.9 million, or $1.71 per diluted
common share. Excluding the $24.7 million tax refund for the first nine months
of 1997, net income applicable to common stock was $286.6 million, or $1.64 per
diluted common share.

Other highlights of the first nine months of 1998 include:

- Net interest income, on a taxable-equivalent basis, was $983.1 million for
the first nine months of 1998, a $65.6 million, or 7 percent, increase
from the comparable period one year earlier. The

S-26
<PAGE>
increase in net interest income was primarily due to a 16 basis point
increase in the net interest margin and a $936.6 million, or 4 percent,
increase in average earning assets, resulting primarily from a $1.2
billion, or 6 percent, increase in average loans, largely funded by a $1.1
billion, or 15 percent, increase in average noninterest bearing deposits.

- A provision for credit losses of $45.0 million was recorded for the first
nine months of 1998, compared with no provision in 1997. Net charge-offs
for the nine months ended September 30, 1998 were $21.0 million. This
resulted from management's regular quarterly assessments of overall credit
quality, loan growth and economic conditions in relation to the level of
the allowance for credit losses.

- Noninterest income was $399.9 million, an increase of $57.3 million, or 17
percent, over the first nine months of 1997. This increase includes the
$17.1 million gain from the sale of the credit card portfolio in the
second quarter of 1998. Service charges on deposit accounts grew $16.6
million, or 20 percent, reflecting growth in average deposits; trust and
investment management fees increased $12.1 million, or 16 percent, on
growth in assets under management; international commissions and fees
increased $4.9 million; and securities gains, net increased $3.5 million,
primarily from the sale of securities available for sale.

- Noninterest expense was $836.2 million for the first nine months of 1998,
compared with $762.2 million for the first nine months of 1997, an
increase of $74.0 million, or 10 percent. Personnel-related expense
increased $40.6 million, or 10 percent, primarily due to increases in
salaries, a portion of which relates to increases in staffing,
performance-based incentive compensation as well as a decline in the fair
value of assets underlying postretirement benefit plans, caused by the
downturn in the financial markets. Professional fees increased $6.1
million, or 32 percent, primarily due to additional costs related to the
year 2000 effort. Other noninterest expense increased $24.4 million, or 22
percent, primarily attributable to additional expenses incurred to support
higher deposit volumes.

- The effective tax rate for the first nine months of 1998 was 29 percent,
compared with 35 percent for the first nine months of 1997. The lower
effective tax rate for the first nine months of 1998 was the result of a
total reduction of $52.4 million, net of federal tax, in state income tax
liabilities. Excluding this state tax reduction, the effective tax rate
for the first nine months of 1998 was 40 percent. Excluding the $24.7
million after-tax refund from the State of California Franchise Tax Board,
the effective tax rate for the first nine months of 1997 was 40 percent.

- The return on average assets for the first nine months of 1998 increased
to 1.56 percent, compared to 1.45 percent for the first nine months of
1997. The return on average common equity increased slightly to 16.87
percent for the first nine months of 1998, compared to 16.85 percent for
the first nine months of 1997.

- Total loans at September 30, 1998 increased $756.4 million, or 3 percent,
over December 31, 1997, primarily due to growth in the commercial,
financial and industrial portfolio.

- Our Tier 1 and total risk-based capital ratios were 9.53 percent and 11.51
percent at September 30, 1998, compared with 8.96 percent and 11.05
percent at December 31, 1997. Our September 30, 1998 leverage ratio was
9.37 percent, compared with 8.53 percent at December 31, 1997.

S-27
<PAGE>
NET INTEREST INCOME

<TABLE>
<CAPTION>
FOR THE NINE MONTHS ENDED
--------------------------------------------------------------------------
SEPTEMBER 30, 1997 SEPTEMBER 30, 1998
------------------------------------ ------------------------------------
INTEREST AVERAGE INTEREST AVERAGE
AVERAGE INCOME/ YIELD/ AVERAGE INCOME/ YIELD/
BALANCE EXPENSE(1) RATE(1) BALANCE EXPENSE(1) RATE(1)
----------- ---------- ----------- ----------- ---------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
ASSETS:
Loans:(2)
Domestic............................. $20,218,298 $1,245,658 8.23% $21,569,891 $1,297,483 8.04%
Foreign(3)........................... 1,475,031 66,578 6.03 1,347,101 68,380 6.79
Securities -- taxable(4)............... 2,476,970 116,715 6.29 2,949,151 139,720 6.32
Securities -- tax-exempt(4)............ 126,634 9,567 10.07 106,783 8,348 10.42
Interest bearing deposits in banks..... 996,710 43,404 5.82 279,938 14,187 6.78
Federal funds sold and securities
purchased under resale agreements.... 450,603 18,727 5.56 281,565 11,784 5.60
Trading account assets................. 322,028 13,389 5.56 468,450 20,137 5.75
----------- ---------- ----------- ----------
Total earning assets............... 26,066,274 1,514,038 7.76 27,002,879 1,560,039 7.72
----------- ---------- ----------- ----------
Allowance for credit losses............ (514,043) (471,384)
Cash and due from banks................ 2,005,177 1,903,155
Premises and equipment, net............ 413,024 402,197
Other assets........................... 1,481,296 1,294,046
----------- -----------
Total assets....................... $29,451,728 $30,130,893
----------- -----------
----------- -----------
LIABILITIES:
Domestic deposits:
Interest bearing..................... $ 5,274,137 $ 111,457 2.83 $ 5,447,712 $ 115,626 2.84
Savings and consumer time............ 2,956,493 83,695 3.78 3,176,898 90,713 3.82
Large time............................. 4,691,506 191,547 5.46 3,606,182 146,945 5.45
Foreign deposits(3).................... 1,560,149 55,156 4.73 1,723,282 66,454 5.16
----------- ---------- ----------- ----------
Total interest bearing deposits.... 14,482,285 441,855 4.08 13,954,074 419,738 4.02
----------- ---------- ----------- ----------
Federal funds purchased and securities
sold under repurchase agreements..... 1,106,180 44,053 5.32 1,481,809 59,667 5.38
Subordinated capital notes............. 353,429 17,180 6.50 335,179 15,883 6.34
Commercial paper....................... 1,631,056 66,543 5.45 1,641,425 67,720 5.52
Other borrowed funds................... 673,359 26,999 5.36 323,082 13,975 5.78
----------- ---------- ----------- ----------
Total borrowed funds............... 3,764,024 154,775 5.50 3,781,495 157,245 5.56
----------- ---------- ----------- ----------
Total interest bearing
liabilities...................... 18,246,309 596,630 4.37 17,735,569 576,983 4.35
---------- ----------
Noninterest bearing deposits........... 7,341,239 8,432,086
Other liabilities...................... 1,274,000 1,170,511
----------- -----------
Total liabilities.................. 26,861,548 27,338,166
----------- -----------
----------- -----------
SHAREHOLDERS' EQUITY
Preferred stock........................ 120,659 --
Common equity.......................... 2,469,521 2,792,727
----------- -----------
Total shareholders' equity......... 2,590,180 2,792,727
----------- -----------
Total liabilities and shareholders'
equity........................... $29,451,728 $30,130,893
----------- -----------
----------- -----------
Net interest income/margin (taxable-
equivalent basis).................... 917,408 4.70% 983,056 4.86%
Less: taxable-equivalent adjustment.... 4,107 3,417
---------- ----------
Net interest income................ $ 913,301 $ 979,639
---------- ----------
---------- ----------
</TABLE>

- ------------------------------
(1) Yields and interest income are presented on a taxable-equivalent basis using
the federal statutory tax rate of 35 percent.

(2) Average balances on loans outstanding include all nonperforming and
renegotiated loans. The amortized portion of net loan origination fees
(costs) is included in interest income on loans, representing an adjustment
to the yield.

(3) Foreign loans and deposits are those loans and deposits originated in
foreign branches.

(4) Yields on securities available for sale are based on fair value. The
difference between these yields and those based on amortized cost was not
significant.

S-28
<PAGE>
Net interest income is interest earned on loans and investments less
interest expense on deposit accounts and borrowings. Primary factors affecting
the level of net interest income include the margin between the yield earned on
interest earning assets and the rate paid on interest bearing liabilities, as
well as the volume and composition of average interest earning assets and
average interest bearing liabilities.

For the first nine months of 1998, net interest income, on a taxable
equivalent basis, was $983.1 million, compared with $917.4 million in the
comparable period one year earlier. The increase of $65.6 million, or 7 percent,
was primarily attributable to a $936.6 million, or 4 percent, increase in
average earning assets largely funded by a $1.1 billion, or 15 percent, increase
in average noninterest bearing deposits. In addition, the net interest margin
increased 16 basis points to 4.86 percent. Although the differential between the
decrease in the yield on average earning assets and the decrease in the rate of
average interest bearing liabilities was a negative 2 basis points, the negative
impact on the net interest margin of these two factors was more than offset by
the increase in the proportion of funding provided by average noninterest
bearing deposits.

Average earning assets were $26.1 billion, for the nine months ended
September 30, 1997 and $27.0 billion for the nine months ended September 30,
1998. Most of this increase was attributable to growth in average loans, which
increased $1.2 billion, or 6 percent, and average securities, which were $452.3
million, or 17 percent, higher. This increase was partially offset by a $716.8
million decrease in average interest bearing deposits in banks. The growth in
average loans outstanding was attributable to the increase in average
commercial, financial and industrial loans of $1.5 billion, partly offset by the
decrease in average consumer loans of $337.4 million, which was primarily
related to the sale of the credit card portfolio. See "Loans" on page S-32 for
additional commentary on growth in the loan portfolio. The increase in primarily
fixed rate securities reflected interest rate risk management actions to reduce
our exposure to declines in interest rates.

NONINTEREST INCOME

<TABLE>
<CAPTION>
FOR THE NINE MONTHS ENDED
---------------------------------------
SEPTEMBER 30, SEPTEMBER 30, PERCENT
1997 1998 CHANGE
------------- ------------- ---------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Service charges on deposit accounts....................................... $ 84,699 $ 101,288 19.59%
Trust and investment management fees...................................... 76,737 88,806 15.73
International commissions and fees........................................ 49,593 54,516 9.93
Merchant transaction processing fees...................................... 42,653 42,988 0.79
Merchant banking fees..................................................... 19,899 24,083 21.03
Brokerage commissions and fees............................................ 11,529 14,188 23.06
Foreign exchange trading gains, net....................................... 11,249 14,159 25.87
Securities gains, net..................................................... 2,098 5,579 165.92
Gain on sale of credit card portfolio..................................... -- 17,056 nm
Other..................................................................... 44,170 37,286 (15.59)
------------- -------------
Total noninterest income................................................ $ 342,627 $ 399,949 16.73%
------------- -------------
------------- -------------
</TABLE>

- ------------------------

nm = not meaningful

For the first nine months of 1997, noninterest income was $342.6 million,
compared with $399.9 million for the same period in 1998. This increase of $57.3
million, or 17 percent, includes the second quarter 1998 gain of $17.1 million
from the sale of the credit card portfolio, a $16.6 million increase in service
charges on deposit accounts, reflecting a 3 percent increase in average deposits
coupled with the expansion of several products and services, a $12.1 million
increase in trust and investment management

S-29
<PAGE>
fees, largely due to growth of assets under management, a $4.9 million increase
in international commissions and fees, a $3.5 million increase in securities
gains, net, and a $6.8 million increase related to brokerage commissions and
merchant banking fees. In contrast, other noninterest income decreased $6.9
million, or 16 percent, due to a $7.7 million nonrecurring gain recognized in
1997 related to a real estate joint venture and the $2.9 million trading loss in
1998, partially offset by the $4.8 million gain recognized in the second quarter
of 1998 from the sale of commercial real estate loans.

NONINTEREST EXPENSE

<TABLE>
<CAPTION>
FOR THE NINE MONTHS ENDED
-----------------------------------------
SEPTEMBER 30, SEPTEMBER 30, PERCENT
1997 1998 CHANGE
------------- ------------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Salaries and other compensation........................................... $ 337,401 $ 369,715 9.58%
Employee benefits......................................................... 81,569 89,877 10.19
------------- -------------
Personnel-related expense............................................... 418,970 459,592 9.70
Net occupancy............................................................. 64,133 67,294 4.93
Equipment................................................................. 41,206 41,842 1.54
Merchant transaction processing........................................... 31,269 33,008 5.56
Communications............................................................ 31,135 31,515 1.22
Professional services..................................................... 19,062 25,186 32.13
Advertising and public relations.......................................... 20,759 22,419 8.00
Data processing........................................................... 19,115 20,462 7.05
Printing and office supplies.............................................. 17,646 19,112 8.31
Software.................................................................. 12,358 14,536 17.62
Travel.................................................................... 11,321 13,041 15.19
Intangible asset amortization............................................. 10,014 10,069 0.55
Armored car............................................................... 9,160 8,989 (1.87)
Foreclosed asset expense (income)......................................... (696) (746) nm
Merger and integration expense............................................ 6,037 -- nm
Other..................................................................... 50,719 69,859 37.74
------------- -------------
Total noninterest expense............................................... $ 762,208 $ 836,178 9.70%
------------- -------------
------------- -------------
</TABLE>

- ------------------------

nm = not meaningful

Noninterest expense was $762.2 million for the first nine months of 1997,
compared with $836.2 million for the first nine months of 1998, an increase of
$74.0 million, or 10 percent. Personnel-related expense increased $40.6 million,
or 10 percent, primarily due to a $16.7 million increase in performance-based
incentive compensation, a 4 percent increase in the workforce, to support
increased revenue growth, and a $4.8 million increase in benefits expense
arising from a loss in the fair value of assets underlying postretirement
benefit plans. Professional services increased $6.1 million, or 32 percent, due
to additional costs related to the year 2000 effort. In addition, other
noninterest expense increased $19.1 million, primarily attributable to
additional expenses incurred to support higher deposit volumes.

We continue to make preparations for the year 2000. For a detailed
discussion of our year 2000 program see "Year 2000" on page S-64. The total cost
of our year 2000 project is estimated to be approximately $50 million, of which
$10 million relates to capital expenditures which we will capitalize and
depreciate over their useful lives. The remaining $40 million will be included
in noninterest expense in the period incurred. As of September 30, 1998, we
spent $19 million on our year 2000 project, $2 million in 1997 and $17 million
in 1998. Of the $19 million spent, as of September 30, 1998, $6 million relates
to capital expenditures, $1 million in 1997 and $5 million in 1998. Of the
estimated $31 million remaining to

S-30
<PAGE>
be spent, an estimated $4 million is for capital expenditures. The cost of the
year 2000 project is being funded by normal operating cash and staffed by
external resources as well as internal staff re-deployed from less
time-sensitive assignments. Estimated total cost could change further as
analysis continues.

The combination of Union Bank and BanCal Tri-State Corporation on April 1,
1996 resulted in the recording of a total of $123.5 million in merger and
integration expense. The remaining liability balance at September 30, 1998 was
$10.6 million. The balance includes amounts primarily for lease payments that
are continuing over the expected term of the leases. Merger and integration
expense of $6.0 million was recorded for the first nine months of 1997, compared
with none for the first nine months of 1998.

INCOME TAX EXPENSE

The effective tax rate for the nine months ended September 30, 1997 was
reduced as a result of an after-tax refund from the State of California
Franchise Tax Board of $24.7 million in settlement of litigation, administration
and audit disputes covering the years 1975-1987. The effective tax rate for the
nine months ended September 30, 1997 was 35 percent. The effective tax rate for
the nine months ended September 30, 1998 was 29 percent. The decrease in the
effective tax rate for 1998 was the result of a reduction of California
franchise taxes for 1997 and 1998 from our ability to file California franchise
tax returns on a worldwide unitary basis, which incorporates the financial
results of The Bank of Tokyo-Mitsubishi and its worldwide affiliates. The total
reduction of $52.4 million, net of federal tax, was reflected in the third
quarter of 1998. Of this amount, $29 million related to the reversal of
previously accrued 1997 state income tax liabilities and $23.4 million related
to a lower state tax provision in 1998. Excluding these reductions, the
effective tax rates for all periods would have been 40 percent.

At this time, we anticipate that we will continue to file our California
franchise tax return on the worldwide basis for 1999. Our anticipated 1999 tax
rate will be dependent on our proportionate share of The Bank of
Tokyo-Mitsubishi financial results for that year, and is expected to be within
the range of 35 to 40 percent.

S-31
<PAGE>
LOANS

The following table shows loans outstanding by loan type.

<TABLE>
<CAPTION>
PERCENT CHANGE TO
SEPTEMBER 30, 1998 FROM:
---------------------------
SEPTEMBER 30, DECEMBER 31, SEPTEMBER 30, SEPTEMBER 30, DECEMBER 31,
1997 1997 1998 1997 1997
------------- ------------- ------------- ------------- ------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
Domestic:
Commercial, financial and
industrial........................ $ 10,405,299 $ 10,747,179 $ 12,151,210 16.78% 13.06%
Construction........................ 312,318 293,333 420,267 34.56 43.27
Mortgage:
Residential....................... 2,966,326 2,961,233 2,742,451 (7.55) (7.39)
Commercial........................ 2,851,838 2,951,807 2,980,371 4.51 0.97
------------- ------------- -------------
Total mortgage.................. 5,818,164 5,913,040 5,722,822 (1.64) (3.22)
Consumer:
Installment....................... 2,075,065 2,090,752 2,026,441 (2.34) (3.08)
Home equity....................... 1,027,147 992,916 844,256 (17.81) (14.97)
Credit card and other lines of
credit.......................... 275,258 270,097 -- nm nm
------------- ------------- -------------
Total consumer.................. 3,377,470 3,353,765 2,870,697 (15.00) (14.40)
Lease financing..................... 863,745 874,860 1,013,772 17.37 15.88
------------- ------------- -------------
Total loans in domestic
offices....................... 20,776,996 21,182,177 22,178,768 6.75 4.70
Loans originated in foreign
branches............................ 1,520,728 1,559,231 1,319,077 (13.26) (15.40)
------------- ------------- -------------
Total loans..................... $ 22,297,724 $ 22,741,408 $ 23,497,845 5.38% 3.33%
------------- ------------- -------------
------------- ------------- -------------
</TABLE>

- ------------------------

nm = not meaningful

Our lending activities are predominantly domestic, with such loans and
leases comprising 94 percent of the portfolio at September 30, 1998. Total loans
at September 30, 1998 were $23.5 billion, an increase of $756.4 million, or 3
percent, from December 31, 1997. The increase was primarily attributable to
growth in the commercial, financial and industrial loan portfolio, which
increased $1.4 billion from December 31, 1997, partly offset by the consumer
loan portfolio, which decreased $483.1 million.

Commercial, financial and industrial loans represent the largest category in
the loan portfolio. These loans are extended principally to major corporations,
middle market businesses, and small businesses, with no industry concentration
exceeding 10 percent of total commercial, financial and industrial loans. At
year-end 1997, the commercial, financial and industrial loan portfolio was $10.7
billion, or 47 percent of total loans, and, at September 30, 1998, it was $12.2
billion, or 52 percent of total loans. The increase of $1.4 billion, or 13
percent, from year-end 1997 was primarily attributable to continued growth in
loans extended to large corporations.

The construction loan portfolio totaled $293.3 million, or 1 percent of
total loans, at December 31, 1997, compared with $420.3 million, or 2 percent of
total loans, at September 30, 1998. This growth is primarily attributable to the
favorable California real estate market coupled with the continuing improvement
in the West Coast economy.

Mortgage loans were $5.9 billion, or 26 percent of total loans, at December
31, 1997, compared with $5.7 billion, or 24 percent of total loans, at September
30, 1998. The mortgage loan portfolio consists of

S-32
<PAGE>
loans on commercial and industrial projects and loans secured by one to four
family residential properties, primarily in California. Despite the sale of
$123.0 million in commercial real estate mortgages during the second quarter of
1998, commercial mortgage loans increased $28.6 million from December 31, 1997,
primarily attributable to the favorable California real estate market coupled
with the continuing improvement in the West Coast economy. Residential mortgage
loans decreased $218.8 million due to prepayments arising from the favorable
interest rate environment and to sales in the secondary market.

Consumer loans totaled $3.4 billion, or 15 percent of total loans, at
December 31, 1997, compared with $2.9 billion, or 12 percent of total loans, at
September 30, 1998. The decrease of $483.1 million was attributable to the sale
of the $253.0 million credit card loan portfolio in April 1998, and to a
reduction in home equity loans as customers refinanced to take advantage of
favorable long-term, fixed rate mortgages.

Lease financing totaled $874.9 million, or 4 percent of total loans, at
December 31, 1997, compared with $1 billion, or 4 percent of total loans, at
September 30, 1998.

Loans originated in foreign branches totaled $1.6 billion, or 7 percent of
total loans, at December 31, 1997 and $1.3 billion, or 6 percent of total loans,
at September 30, 1998.

CROSS-BORDER OUTSTANDINGS

Our cross-border outstandings reflect additional economic and political
risks that are not reflected in domestic outstandings. These risks include those
arising from exchange rate fluctuations and restrictions on the transfer of
funds. The following table sets forth our cross-border outstandings as of
September 30, 1997, December 31, 1997, and September 30, 1998 for each country
where such outstandings exceeded 1 percent of total assets. The cross-border
outstandings were compiled based upon category and domicile of ultimate risk and
are comprised of balances with banks, trading account assets, securities
available for sale, securities purchased under resale agreements, loans, accrued
interest receivable, acceptances outstanding and investments with foreign
entities. The amounts outstanding for each country exclude local currency
outstandings. We do not have significant local currency outstandings to the
individual countries listed in the following table that are not hedged or are
not funded by local currency borrowings.

<TABLE>
<CAPTION>
PUBLIC CORPORATIONS
FINANCIAL SECTOR AND OTHER TOTAL
INSTITUTIONS ENTITIES BORROWERS OUTSTANDINGS
------------- ----------- --------------- -------------
(DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C>
September 30, 1997
Japan....................................................... $ 939 $ -- $ 403 $ 1,342
Korea....................................................... 691 36 293 1,020

December 31, 1997
Japan....................................................... 401 -- 438 839
Korea....................................................... 561 10 257 828
Thailand.................................................... 320 -- -- 320

September 30, 1998
Japan....................................................... 115 -- 469 584
Korea....................................................... 376 -- 139 515
</TABLE>

The economic condition and the ability of some countries, to which we have
cross-border exposure, to manage their external debt obligations have been
impacted by the Asian economic crisis which began in the second half of 1997.
The impact of the Asian crisis appears to be spreading to other global markets.
Our exposure in all affected countries continues to be short-term in nature and
substantially related to the finance of trade. Although the extent of risk will
vary from country to country, and institution to institution, these short-term
exposures are characterized by management to be in the low to moderate range.

S-33
<PAGE>
Cross-border exposures, other than those referred to in the table above,
include total outstandings as of September 30, 1998 of $133 million in Brazil.

Since Japan is the second largest trading nation in the world, its
political, economic and financial markets situation is being closely monitored.
The situation in Japan is worsening and the depressed conditions in that country
are impacting other areas which are highly dependent on trade relations with it.
There is considerable concern that the United States is not immune to the
effects of the depressed economic conditions in Japan and to the Asian crisis.
Management is monitoring our portfolio accordingly.

Although management cannot predict the ultimate impact of the global
financial crisis on our financial position and results of operations since much
depends on the effect of the stabilizing activities already under way,
management believes that the continuation of internal supervision, monitoring
and portfolio risk management practices will be effective in minimizing the
impact over and above that already identified. Increases in nonaccrual loans,
together with some related increases in charge-off activity, may occur as events
unfold.

ALLOWANCE FOR CREDIT LOSSES

The allowance for credit losses is maintained at a level considered
appropriate by management and is based on an ongoing assessment of risk in the
credit and lease portfolio, including commitments to provide financing. The
allowance is increased by the provision for credit losses, which is charged
against current period operating results, and is decreased by the amount of net
loans charged off during the period. In evaluating the adequacy of the allowance
for credit losses, management incorporates such factors as collateral value,
portfolio composition and concentration, and trends in local, national, and
international economic conditions and the related impact on the financial
strength of our borrowers. While the allowance is segmented by broad portfolio
categories to analyze its adequacy, the allowance is general in nature and is
available for the portfolio in its entirety. Although management believes that
the allowance for credit losses is adequate as of September 30, 1998, future
provisions will be subject to continuing evaluation of risk in the credit and
lease portfolio.

S-34
<PAGE>

The table below presents a reconciliation of changes in the allowance for
credit losses.

<TABLE>
<CAPTION>
FOR THE NINE MONTHS
ENDED SEPTEMBER 30,
----------------------
1997 1998
---------- ----------
(DOLLARS IN THOUSANDS)
<S> <C> <C>
Balance, beginning of period............................................................ $ 523,946 $ 451,692
Loans charged off:
Commercial, financial and industrial.................................................. 40,618 21,966
Construction.......................................................................... 120 3
Mortgage.............................................................................. 4,481 4,992
Consumer.............................................................................. 38,864 24,206
Lease financing....................................................................... 2,502 1,971
---------- ----------
Total loans charged off............................................................. 86,585 53,138
Recoveries of loans previously charged off:
Commercial, financial and industrial.................................................. 18,473 17,788
Construction.......................................................................... 9,054 3
Mortgage.............................................................................. 2,833 2,705
Consumer.............................................................................. 10,575 11,389
Lease financing....................................................................... 284 273
---------- ----------
Total recoveries of loans previously charged off.................................... 41,219 32,158
---------- ----------
Net loans charged off............................................................. 45,366 20,980
Provision for credit losses............................................................. -- 45,000
Transfer of reserve for trading account assets.......................................... -- (1,911)
Foreign translation adjustment and other net additions (deductions)..................... (126) (84)
---------- ----------
Balance, end of period.................................................................. $ 478,454 $ 473,717
---------- ----------
---------- ----------
Allowance for credit losses to total loans.............................................. 2.15% 2.02%
Provision for credit losses to net loans charged off.................................... nm 214.49
Net loans charged off to average loans outstanding for the period(1).................... 0.28 0.12
</TABLE>

- ------------------------

(1) Annualized.

nm = not meaningful

At September 30, 1997, our allowance for credit losses was $478.5 million,
or 2.15 percent of total loans, and 435.9 percent of total nonaccrual loans,
compared with an allowance for credit losses at September 30, 1998 of $473.7
million, or 2.02 percent of total loans, and 697.2 percent of total nonaccrual
loans.

For the nine months ended September 30, 1997, we recorded no provision for
credit losses, compared with a $45.0 million provision for the nine months ended
September 30, 1998. Management considers a range of estimated credit losses
inherent in the portfolio when evaluating the adequacy of the allowance for
credit losses. Central to this process is the required reserve, an amount
calculated by applying historical loss factors to the amount of credit we have
extended to our customers. These factors are based on loss experience, adjusted
for significant factors that affect the collectibility of the portfolio as of
the evaluation date. Additional amounts, which are unallocated, provide a margin
of error for the required reserve calculation. At September 30, 1998, the
unallocated reserve is also available to cover specific credit risks which are
more difficult to quantify. These risks, such as the weak economic indicators in
the global markets, the decline in oil prices, the potentially adverse impact on
agriculture from "El Nino," and the volatility in the debt and equity markets,
add to the uncertainty in estimating credit losses. When determining the need
for a credit provision, these factors, as well as the likelihood of loan
charge-offs, are used.

S-35
<PAGE>

Net loans charged-off were $45.4 million for the nine months ended September
30, 1997 and $21.0 million for the nine months ended September 30, 1998. Loans
charged-off in 1998 decreased by $33.4 million primarily due to a $18.7 million
decrease in commercial, financial and industrial loans charged-off as portfolio
quality improved, and a $14.7 million decrease in consumer loans charged-off
primarily due to the sale of the credit card portfolio in April of 1998.
Recoveries of loans previously charged-off decreased by $9.1 million, and the
percentage of net loans charged-off to average loans decreased from 0.28 percent
for the nine months ended September 30, 1997 to 0.12 percent for the nine months
ended September 30, 1998.

In the third quarter 1998, we reclassified a $1.9 million previously
established reserve for credit losses related to interest rate derivatives and
foreign exchange contracts from the unallocated portion of the allowance for
credit losses. The reserve for derivative and foreign exchange contracts is
presented as an offset to trading account assets. Future changes in the reserve
as a result of changes in the positive replacement cost of those contracts will
be provided as an offset to trading gains and losses.

We evaluate our loan portfolio for impairment as defined by SFAS No. 114,
"Accounting by Creditors for Impairment of a Loan", as amended. At December 31,
1997, total impaired loans were $108.4 million and the associated impairment
allowance was $9.4 million, compared with total impaired loans of $67.9 million
and an associated impairment allowance of $7.5 million at September 30, 1998.

NONPERFORMING ASSETS

<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31, SEPTEMBER 30,
1997 1997 1998
------------- ------------ -------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Commercial, financial and industrial................................. $ 54,087 $ 46,392 $ 55,407
Construction......................................................... 4,579 4,071 4,377
Mortgage:
Residential........................................................ 1,133 954 --
Commercial......................................................... 49,959 57,921 8,163
------------- ------------ -------------
Total mortgage................................................... 51,092 58,875 8,163
------------- ------------ -------------
Total nonaccrual loans........................................... 109,758 109,338 67,947
Foreclosed assets.................................................... 23,216 20,471 13,452
------------- ------------ -------------
Total nonperforming assets....................................... $ 132,974 $ 129,809 $ 81,399
------------- ------------ -------------
------------- ------------ -------------
Allowance for credit losses.......................................... $ 478,454 $ 451,692 $ 473,717
------------- ------------ -------------
------------- ------------ -------------
Nonaccrual loans to total loans...................................... 0.49% 0.48% 0.29%
Allowance for credit losses to nonaccrual loans...................... 435.92 413.12 697.19
Nonperforming assets to total loans and foreclosed assets............ 0.60 0.57 0.35
Nonperforming assets to total assets................................. 0.43 0.42 0.26
</TABLE>

At September 30, 1998, nonperforming assets totaled $81.4 million, a
decrease of $48.4 million, or 37 percent, from December 31, 1997. The decrease
was primarily the result of reductions of $49.8 million in nonaccrual commercial
mortgage loans due to a combination of note sales, repayments and restorations
to accrual and $7.0 million in foreclosed assets due to sales of individual
assets.

Nonaccrual loans as a percentage of total loans were 0.48 percent at
December 31, 1997, compared with 0.29 percent at September 30, 1998.
Nonperforming assets as a percentage of total loans and foreclosed assets were
0.57 percent at December 31, 1997, compared with 0.35 percent at September 30,
1998.

S-36
<PAGE>
LOANS 90 DAYS OR MORE PAST DUE AND STILL ACCRUING

REGULATORY CAPITAL

The following table summarizes our risk-based capital, risk-weighted assets,
and risk-based capital ratios.

<TABLE>
<CAPTION>
MINIMUM
SEPTEMBER 30, DECEMBER 31, SEPTEMBER 30, REGULATORY
1997 1997 1998 REQUIREMENT
------------- ------------- ------------- -----------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C>
CAPITAL COMPONENTS:
Tier 1 capital...................................... $ 2,520,589 $ 2,587,071 $ 2,876,605
Tier 2 capital...................................... 593,865 601,102 598,027
------------- ------------- -------------
Total risk-based capital.......................... $ 3,114,454 $ 3,188,173 $ 3,474,632
------------- ------------- -------------
Risk-weighted assets................................ $ 28,249,379 $ 28,862,340 $ 30,176,967
------------- ------------- -------------
------------- ------------- -------------
Quarterly average assets............................ $ 30,037,626 $ 30,334,507 $ 30,696,414
------------- ------------- -------------
------------- ------------- -------------

CAPITAL RATIOS:
Total risk-based capital............................ 11.02% 11.05% 11.51% 8.0%
Tier 1 risk-based capital........................... 8.92 8.96 9.53 4.0
Leverage ratio(1)................................... 8.39 8.53 9.37 4.0
</TABLE>

- ------------------------

(1) Tier 1 capital divided by quarterly average assets, excluding goodwill.

UnionBanCal Corporation and its bank must comply with various regulations
issued by Federal banking agencies, including minimum capital requirements.
UnionBanCal Corporation and its bank are required to maintain minimum ratios of
total and Tier 1 capital to risk-weighted assets and of Tier 1 capital to
average assets, which is the leverage ratio.

Compared with December 31, 1997, our Tier 1 risk-based capital ratio at
September 30, 1998 increased 57 basis points to 9.53 percent, the total
risk-based capital ratio increased 46 basis points to 11.51 percent, and the
leverage ratio increased 84 basis points to 9.37 percent. The increase in the
capital ratios was primarily attributable to retained earnings growing faster
than both risk-weighted assets and average assets, partly offset by the
reduction of $50.0 million in subordinated capital notes.

As of September 30, 1998, management believes the capital ratios of our bank
met all regulatory minimums of a "well-capitalized" institution.

S-37
<PAGE>

YEAR ENDED DECEMBER 31, 1997 COMPARED TO YEAR ENDED DECEMBER 31, 1996

To facilitate the discussion of the results of operations the Selected
Consolidated Financial and Operating Data table on page S-24 includes pro forma
earnings disclosures and ratios. These "pro forma" presentations supplement the
Consolidated Statements of Income on page F-2, which are prepared in accordance
with generally accepted accounting principles, primarily regarding the treatment
of merger and integration expense. Pro forma means that the amounts presented do
not include the effects of the cumulative change in accounting and merger and
integration expense for the period presented. We believe that it is meaningful
to understand the operating results and trends excluding these expenses and,
therefore, have included information in the tables referred to above and in the
discussion that follows, that presents income before merger and integration
expense and income taxes and related pro forma ratio and per share calculations.

SUMMARY

Net income in 1997 was $411 million, including $4 million (after-tax) of
merger and integration related expense. Net income in 1996 was $249 million,
including $72 million (after-tax) of merger and integration related expense. Net
income applicable to common stock was $404 million, or $2.30 per diluted common
share, in 1997 compared with $238 million, or $1.36 per diluted common share, in
1996. Excluding after-tax merger and integration expense, pro forma earnings for
1997 were $415 million, an increase of 29 percent from $321 million a year
earlier. Pro forma earnings applicable to common stock were $407 million, or
$2.32 per diluted common share, in 1997 compared with $310 million, or $1.77 per
diluted common share, in 1996. This increase of 31 percent over the comparable
figures for 1996 was due to a 5 percent increase in net interest income, an 11
percent increase in noninterest income, a decrease in the effective income tax
rate, and a $40 million reduction in the provision for credit losses, partially
offset by a 2 percent increase in noninterest expense (excluding merger and
integration expense). Other highlights for 1997 include:

- Net interest income, on a taxable-equivalent basis, was $1,237 million in
1997, an increase of $62 million, or 5 percent, over 1996 primarily due to
a $1.6 billion, or 6 percent, increase in average earning assets,
resulting primarily from a $1.1 billion, or 5 percent, increase in average
loans and largely funded by an $851 million, or 13 percent, increase in
average demand deposits. Partially offsetting the positive impact of the
growth in earning assets and demand deposits on net interest income was a
5 basis point decline in the net interest margin to 4.70%. The decline in
net interest margin was primarily due to a 14 basis point decrease in the
spread between the average yield on earning assets and the average rate
paid on interest bearing liabilities.

- No provision for credit losses was recorded in 1997 compared with $40
million in 1996, reflecting improvement in the quality of our loan
portfolio and a reduction in nonaccrual loans. Nonperforming assets
declined $27 million, or 17 percent, from December 31, 1996 to $130
million at December 31, 1997. Nonperforming assets as a percent of total
assets declined to 0.42% at December 31, 1997 compared with 0.54% a year
earlier. Total nonaccrual loans were $109 million at December 31, 1997
compared with $128 million at year-end 1996, resulting in a reduction in
the ratio of nonaccrual and renegotiated loans to total loans from 0.61%
at December 31, 1996 to 0.48% at year-end 1997. The allowance for credit
losses was $452 million, or 413% of total nonaccrual loans, at December
31, 1997 compared with $524 million, or 408% of total nonaccrual loans, at
December 31, 1996.

- Noninterest income was $463 million in 1997, an increase of $44 million,
or 11 percent, over 1996. Service charges on deposit accounts grew $13
million, or 12 percent, reflecting growth in deposit balances while trust
and investment management fees increased $14 million, or 15 percent, on
growth in trust accounts and assets under management.

S-38
<PAGE>
- Excluding merger and integration expense, noninterest expense was $1,039
million in 1997, an increase of $21 million, or 2 percent, over 1996. This
increase was primarily attributable to an increase of $14 million, or 3
percent, in personnel-related expense, a significant portion of which was
due to severance payments related to realignment of departments and to
higher performance-related incentive compensation, and an increase of $14
million, or 25 percent, in other expenses. These increases were partially
offset by a decline of $18 million in net occupancy expense, reflecting a
$12 million charge recorded in 1996 related to former banking facilities,
as well as merger efficiencies realized in 1997. Excluding the $12 million
charge in 1996 and merger and integration expense, noninterest expense
increased $33 million over 1996.

- The effective tax rate for 1997 was 37% compared with 40% for 1996.
Excluding the $25 million after-tax refund from the State of California
Franchise Tax Board, the effective tax rate in 1997 was 41%. Excluding a
$5 million after-tax benefit from the settlement of a unitary tax issue
with the State of California Franchise Tax Board, the effective tax rate
in 1996 was also 41%.

- The return on average assets for 1997 increased to 1.39% compared to 0.89%
for 1996. Excluding the after-tax effect of merger and integration
expense, the pro forma return on average assets was 1.40% for 1997
compared to 1.15% for 1996. The return on average common equity for 1997
was 16.05% compared to 10.24% for 1996. Excluding the after-tax effect of
merger and integration expense, the pro forma return on average common
equity was 16.20% for 1997 compared to 13.33% for 1996.

- Total loans at December 31, 1997 were $22.7 billion, an increase of $1.7
billion, or 8 percent, over year-end 1996, primarily from growth in the
commercial, financial and industrial loan portfolio.

- At December 31, 1997, our Tier 1 risk-based capital ratio was 8.96%,
exceeding the minimum regulatory guidelines for bank holding companies of
4%, and the total risk-based capital ratio was 11.05%, exceeding the
minimum regulatory guidelines of 8%. The Tier 1 and total risk-based
capital ratios for our bank at December 31, 1997 exceeded the regulatory
guidelines for "well-capitalized" banks. Our leverage ratio was 8.53% at
December 31, 1997, exceeding the minimum regulatory guideline for bank
holding companies.

S-39
<PAGE>
NET INTEREST INCOME

The table below shows the major components of net interest income and net
interest margin.
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
--------------------------------------------------------------------------------------
1995 1996 1997
------------------------------------ ------------------------------------ ----------
INTEREST AVERAGE INTEREST AVERAGE
AVERAGE INCOME/ YIELD/ AVERAGE INCOME/ YIELD/ AVERAGE
BALANCE EXPENSE(1) RATE(1) BALANCE EXPENSE(1) RATE(1) BALANCE
---------- ----------- ----------- ---------- ----------- ----------- ----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS:
Loans: (2)
Domestic.................... $17,783,993 $1,540,694 8.66% $19,328,752 $1,604,799 8.30% $20,332,494
Foreign(3).................. 1,190,547 76,723 6.44 1,398,825 84,693 6.05 1,523,417
Securities -- taxable(4)...... 2,055,504 120,210 5.85 2,138,282 133,170 6.23 2,521,339
Securities -- tax-exempt(4)... 185,934 18,984 10.21 151,970 15,451 10.17 124,174
Interest bearing deposits in
banks....................... 930,999 58,201 6.25 911,575 52,709 5.78 968,966
Federal funds sold and
securities purchased under
resale agreements........... 368,684 22,247 6.03 547,547 30,246 5.52 466,321
Trading account assets........ 333,468 20,578 6.17 240,375 12,960 5.39 355,111
---------- ----------- ---------- ----------- ----------
Total earning assets...... 22,849,129 1,857,637 8.13 24,717,326 1,934,028 7.82 26,291,822
----------- -----------
Allowance for credit losses... (573,648) (544,806) (503,126)
Cash and due from banks....... 1,617,715 1,926,050 2,006,038
Premises and equipment, net... 411,794 425,943 411,302
Other assets.................. 1,259,853 1,375,221 1,486,956
---------- ---------- ----------
Total assets.............. $25,564,843 $27,899,734 $29,692,992
---------- ---------- ----------
---------- ---------- ----------
LIABILITIES:
Domestic deposits:
Interest bearing............ $4,955,750 129,860 2.62 $5,001,060 135,821 2.72 $5,340,661
Savings and consumer time... 2,738,588 99,215 3.62 2,837,198 105,350 3.71 2,970,370
Large time.................. 2,474,685 128,974 5.21 4,095,222 218,959 5.35 4,652,293
Foreign deposits(3)........... 1,806,820 96,109 5.32 1,504,067 71,437 4.75 1,589,303
---------- ----------- ---------- ----------- ----------
Total interest bearing
deposits................ 11,975,843 454,158 3.79 13,437,547 531,567 3.96 14,552,627
---------- ----------- ---------- ----------- ----------
Federal funds purchased and
securities sold under
repurchase agreements....... 1,384,762 78,908 5.70 933,433 47,095 5.05 1,097,707
Subordinated capital notes.... 615,868 42,538 6.91 458,966 30,104 6.56 354,575
Commercial paper.............. 1,448,739 86,695 5.98 1,620,087 87,411 5.40 1,637,070
Other borrowed funds.......... 731,759 42,561 5.82 1,119,051 62,549 5.59 635,900
---------- ----------- ---------- ----------- ----------
Total borrowed funds...... 4,181,128 250,702 6.00 4,131,537 227,159 5.50 3,725,252
---------- ----------- ---------- ----------- ----------
Total interest bearing
liabilities............. 16,156,971 704,860 4.36 17,569,084 758,726 4.32 18,277,879
----------- -----------
Demand deposits............... 5,994,129 6,663,997 7,514,528
Other liabilities............. 1,081,267 1,206,216 1,295,728
---------- ---------- ----------
Total liabilities......... 23,232,367 25,439,297 27,088,135
SHAREHOLDER'S EQUITY:
Preferred stock............... 135,000 135,000 90,247
Common equity(5).............. 2,197,476 2,325,437 2,514,610
---------- ---------- ----------
Total shareholders'
equity.................. 2,332,476 2,460,437 2,604,857
---------- ---------- ----------
Total liabilities and
shareholders' equity.... $25,564,843 $27,899,734 $29,692,992
---------- ---------- ----------
---------- ---------- ----------
Net interest income/margin
(taxable-equivalent basis).... 1,152,777 5.05% 1,175,302 4.75%
Less: taxable-equivalent
adjustment.................... 10,444 6,724
----------- -----------
Net interest income............. $1,142,333 $1,168,578
----------- -----------
----------- -----------

INTEREST AVERAGE
INCOME/ YIELD/
EXPENSE(1) RATE(1)
----------- -----------

<S> <C> <C>
ASSETS:
Loans: (2)
Domestic.................... $1,672,006 8.22%
Foreign(3).................. 92,420 6.07
Securities -- taxable(4)...... 158,950 6.30
Securities -- tax-exempt(4)... 12,669 10.20
Interest bearing deposits in
banks....................... 56,748 5.86
Federal funds sold and
securities purchased under
resale agreements........... 26,079 5.59
Trading account assets........ 19,917 5.61
-----------
Total earning assets...... 2,038,789 7.75
-----------
Allowance for credit losses...
Cash and due from banks.......
Premises and equipment, net...
Other assets..................

Total assets..............

LIABILITIES:
Domestic deposits:
Interest bearing............ 151,768 2.84
Savings and consumer time... 112,808 3.80
Large time.................. 256,007 5.50
Foreign deposits(3)........... 75,398 4.74
-----------
Total interest bearing
deposits................ 595,981 4.10
-----------
Federal funds purchased and
securities sold under
repurchase agreements....... 58,544 5.33
Subordinated capital notes.... 22,850 6.44
Commercial paper.............. 89,912 5.49
Other borrowed funds.......... 34,492 5.42
-----------
Total borrowed funds...... 205,798 5.52
-----------
Total interest bearing
liabilities............. 801,779 4.39
-----------
Demand deposits...............
Other liabilities.............

Total liabilities.........
SHAREHOLDER'S EQUITY:
Preferred stock...............
Common equity(5)..............

Total shareholders'
equity..................

Total liabilities and
shareholders' equity....

Net interest income/margin
(taxable-equivalent basis).... 1,237,010 4.70%
Less: taxable-equivalent
adjustment.................... 5,328
-----------
Net interest income............. $1,231,682
-----------
-----------
</TABLE>

- ------------------------------
(1) Yields and interest income are presented on a taxable-equivalent basis using
the federal statutory tax rate of 35 percent.

(3) Foreign loans and deposits are those loans and deposits originated in
foreign branches.

(4) Yields on securities available for sale were based on fair value. The
difference between these yields and those based on amortized cost was not
significant.

(5) Amounts restated to give retroactive effect to the exchange referred to in
Note 1 of the accompanying Notes to Consolidated Financial Statements.

S-40
<PAGE>
Net interest income is interest earned on loans and investments less
interest expense on deposit accounts and borrowings. Primary factors affecting
the level of net interest income include the margin between the yield earned on
interest earning assets and the rate paid on interest bearing liabilities, as
well as the volume and composition of average interest earning assets and
average interest bearing liabilities.

Excluding the provision for credit losses, net interest income on a
taxable-equivalent basis was $1,175 million in 1996, compared with $1,237
million in 1997. The increase of $62 million, or 5 percent, was primarily
attributable to a $1.6 billion, or 6 percent, increase in average earning assets
largely funded by an $851 million, or 13 percent, increase in average demand
deposits. Partially offsetting the positive impact of the growth in earning
assets and demand deposits on net interest income was a 5 basis point decline in
the net interest margin to 4.70%, primarily as a result of both a 14 basis point
increase in the cost of interest bearing deposits due to a 25 basis point
increase in the Federal Funds rate in March 1997, and a decrease in the average
yield on domestic loans of 8 basis points.

Average earning assets were $24.7 billion in 1996 compared with $26.3
billion in 1997. This growth was primarily attributable to a $1.1 billion, or 5
percent, increase in average loans and a $355 million, or 16 percent, increase
in average securities. Average commercial, financial and industrial loans, which
increased $582 million, and average commercial mortgage loans, which increased
$437 million, contributed most of the loan growth. See "Loans" at page S-47 for
additional commentary on loan portfolio growth. The increase in primarily fixed
rate securities reflected interest rate risk management actions to reduce our
exposure to declines in interest rates.

The $1.6 billion, or 6 percent, increase in average earning assets over 1996
was primarily funded by increases in average demand deposits and average
interest bearing core deposits. Increases in these categories were: demand
deposits $851 million, or 13 percent; interest bearing domestic deposits $340
million, or 7 percent; and savings and consumer time deposits $133 million, or 5
percent. The increase in demand deposits in 1997 was partially due to an influx
of new customer relationships, arising from the recent merger and acquisition
activities of other financial institutions in the California market during the
year.

S-41
<PAGE>
ANALYSIS OF CHANGES IN NET INTEREST INCOME

The following table shows the changes in the components of net interest
income on a taxable-equivalent basis. The changes in net interest income between
periods have been reflected as attributable either to volume or rate changes.
For purposes of this table, changes which are not solely due to volume or rate
changes are allocated to rate.

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
----------------------------------------------------------------------
1996 VERSUS 1995 1997 VERSUS 1996
---------------------------------- ----------------------------------
INCREASE (DECREASE) DUE TO CHANGE INCREASE (DECREASE) DUE TO
IN CHANGE IN
---------------------------------- ----------------------------------
AVERAGE AVERAGE AVERAGE AVERAGE NET
VOLUME RATE NET CHANGE VOLUME RATE CHANGE
---------- ---------- ---------- ---------- ---------- ----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
CHANGES IN INTEREST INCOME:
Loans:
Domestic...................................... $ 133,776 $ (69,671) $ 64,105 $ 83,311 $ (16,104) $ 67,207
Foreign(1).................................... 13,413 (5,443) 7,970 7,538 189 7,727
Securities -- taxable........................... 4,843 8,117 12,960 23,856 1,924 25,780
Securities -- tax-exempt........................ (3,468) (65) (3,533) (2,826) 44 (2,782)
Interest bearing deposits in banks.............. (1,214) (4,278) (5,492) 3,317 722 4,039
Federal funds sold and securities purchased
under resale agreements....................... 10,785 (2,786) 7,999 (4,484) 317 (4,167)
Trading account assets.......................... (5,744) (1,874) (7,618) 6,184 773 6,957
---------- ---------- ---------- ---------- ---------- ----------
Total earning assets........................ 152,391 (76,000) 76,391 116,896 (12,135) 104,761
---------- ---------- ---------- ---------- ---------- ----------
CHANGES IN INTEREST EXPENSE:
Domestic deposits:
Interest bearing.............................. 1,187 4,774 5,961 9,237 6,710 15,947
Savings and consumer time..................... 3,572 2,563 6,135 4,941 2,517 7,458
Large time.................................... 84,458 5,527 89,985 29,803 7,245 37,048
Foreign deposits(1)............................. (16,104) (8,568) (24,672) 4,049 (88) 3,961
---------- ---------- ---------- ---------- ---------- ----------
Total interest bearing deposits............. 73,113 4,296 77,409 48,030 16,384 64,414
---------- ---------- ---------- ---------- ---------- ----------
Federal funds purchased and securities sold
under repurchase agreements................... (25,718) (6,095) (31,813) 8,296 3,153 11,449
Subordinated capital notes...................... (10,837) (1,597) (12,434) (6,848) (406) (7,254)
Commercial paper................................ 10,254 (9,538) 716 916 1,585 2,501
Other borrowed funds............................ 22,526 (2,538) 19,988 (27,006) (1,051) (28,057)
---------- ---------- ---------- ---------- ---------- ----------
Total borrowed funds........................ (3,775) (19,768) (23,543) (24,642) 3,281 (21,361)
---------- ---------- ---------- ---------- ---------- ----------
Total interest bearing liabilities.......... 69,338 (15,472) 53,866 23,388 19,665 43,053
---------- ---------- ---------- ---------- ---------- ----------
Changes in net interest income.............. $ 83,053 $ (60,528) $ 22,525 $ 93,508 $ (31,800) $ 61,708
---------- ---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ---------- ----------
</TABLE>

- ------------------------

(1) Foreign loans and deposits are those loans and deposits originated in
foreign branches.

Interest income on a taxable-equivalent basis increased $105 million in
1997, primarily due to growth in interest income from domestic loans and
securities, which reflected higher average balances outstanding, partially
offset by a lower average yield primarily on domestic loans.

S-42
<PAGE>
Interest expense increased $43 million in 1997 due to higher interest
expense on interest bearing deposits, primarily reflecting higher average
deposit balances and higher average rates. Interest expense on borrowed funds
declined $21 million in 1997, reflecting lower volumes, offset by a 2 basis
point increase in the average rate paid.

NONINTEREST INCOME

<TABLE>
<CAPTION>
INCREASE (DECREASE)
----------------------------------------------
YEARS ENDED DECEMBER 31,
----------------------------------------------
YEARS ENDED DECEMBER 31, 1996 VERSUS 1995 1997 VERSUS 1996
---------------------------------- ---------------------- ----------------------
1995 1996 1997 AMOUNT PERCENT AMOUNT PERCENT
---------- ---------- ---------- --------- ----------- --------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
Service charges on deposit
accounts.......................... $ 95,177 $ 101,975 $ 114,647 $ 6,798 7% $ 12,672 12%
Trust and investment management
fees.............................. 87,743 93,479 107,527 5,736 7 14,048 15
International commissions and
fees.............................. 68,621 66,108 66,122 (2,513) (4) 14 --
Credit card merchant fees........... 45,767 49,778 57,128 4,011 9 7,350 15
Merchant banking fees............... 24,483 23,929 24,924 (554) (2) 995 4
Foreign exchange trading gains,
net............................... 19,043 13,255 16,268 (5,788) (30) 3,013 23
Brokerage commissions and fees...... 9,270 12,932 15,569 3,662 40 2,637 20
Securities gains (losses), net...... (702) 4,502 2,711 5,204 nm (1,791) (40)
Other............................... 45,917 52,718 58,105 6,801 15 5,387 10
---------- ---------- ---------- --------- ---------
Total noninterest income........ $ 395,319 $ 418,676 $ 463,001 $ 23,357 6% $ 44,325 11%
---------- ---------- ---------- --------- ---------
---------- ---------- ---------- --------- ---------
</TABLE>

- ------------------------

nm = not meaningful

Noninterest income in 1997 was $463 million, an increase of $44 million, or
11 percent, over 1996. This included a $13 million increase in revenue from
service charges on deposit accounts, a $14 million increase in trust and
investment management fees, a $7 million increase in credit card merchant fees,
a $3 million increase in foreign exchange trading gains, net, a $3 million
increase in brokerage commissions and fees, and a $5 million increase in other
noninterest income, partially offset by a $2 million decrease in securities
gains, net.

Revenue from service charges on deposit accounts was $115 million in 1997,
an increase of 12 percent over 1996. The increase was primarily attributable to
an increase in the volume of non-credit services provided.

Trust and investment management fees were $108 million in 1997, 15 percent
higher than in 1996, primarily due to an increase in assets under management,
which resulted in higher mutual fund management fees and personal trust fees.

Credit card merchant fees were $57 million in 1997, an increase of 15
percent over 1996. The increase was primarily due to an increase in the volume
of credit card drafts deposited by merchants.

Foreign exchange trading gains, net increased $3 million, or 23 percent, in
1997, primarily due to more volatility in the foreign exchange markets in 1997.

S-43
<PAGE>
Brokerage commissions and fees were $16 million in 1997, an increase of 20
percent over 1996. The increase was primarily attributable to brokerage
commissions on non-proprietary mutual fund sales.

Other noninterest income in 1997 was $5 million, or 10 percent, higher than
in 1996. Included in other noninterest income in 1997 was an $8 million gain
related to a real estate joint venture, compared with gains of $2 million
related to a real estate joint venture and $2 million related to a non-recurring
insurance refund recognized in 1996.

NONINTEREST EXPENSE

<TABLE>
<CAPTION>
INCREASE (DECREASE)
-------------------------------------------------
YEARS ENDED DECEMBER 31,
-------------------------------------------------
YEARS ENDED DECEMBER 31, 1996/1995 1997/1996
-------------------------------------- ----------------------- ------------------------
1995 1996 1997 AMOUNT PERCENT AMOUNT PERCENT
---------- ------------ ------------ ---------- ----------- ----------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
Salaries and other
compensation.................. $ 432,581 $ 448,793 $ 461,915 $ 16,212 4% $ 13,122 3%
Employee benefits............... 104,090 108,454 109,729 4,364 4 1,275 1
---------- ------------ ------------ ---------- -----------
Personnel-related expense..... 536,671 557,247 571,644 20,576 4 14,397 3
Net occupancy................... 92,863 103,335 85,630 10,472 11 (17,705) (17)
Equipment....................... 55,056 55,942 56,137 886 2 195 --
Communications.................. 35,806 40,133 42,372 4,327 12 2,239 6
Credit card processing.......... 31,288 37,091 42,274 5,803 19 5,183 14
Advertising and public
relations..................... 20,911 28,788 28,664 7,877 38 (124) --
Professional services........... 26,197 24,342 28,075 (1,855) (7) 3,733 15
Data processing................. 18,557 22,140 25,973 3,583 19 3,833 17
Printing and office supplies.... 22,626 27,085 24,098 4,459 20 (2,987) (11)
Software........................ 13,839 15,895 16,562 2,056 15 667 4
Travel.......................... 12,183 14,936 15,763 2,753 23 827 6
Intangible asset
amortization.................. 13,353 13,335 13,352 (18) -- 17 --
Armored car..................... 13,792 13,296 12,209 (496) (4) (1,087) (8)
Regulatory authority
assessments................... 23,431 4,048 5,778 (19,383) (83) 1,730 43
Foreclosed asset expense
(income)...................... (3,213) 2,889 (1,268) 6,102 nm (4,157) nm
Other........................... 64,741 56,938 71,365 (7,803) (12) 14,427 25
---------- ------------ ------------ ---------- -----------
Noninterest expense, excluding
merger and integration
expense..................... 978,101 1,017,440 1,038,628 39,339 4 21,188 2
Merger and integration
expense....................... -- 117,464 6,037 117,464 nm (111,427) (95)
---------- ------------ ------------ ---------- -----------
Total noninterest expense... $ 978,101 $ 1,134,904 $ 1,044,665 $ 156,803 16 % $ (90,239) (8)%
---------- ------------ ------------ ---------- -----------
---------- ------------ ------------ ---------- -----------
</TABLE>

- ------------------------

nm = not meaningful

Noninterest expense, excluding merger and integration expense, was $1,039
million in 1997, an increase of $21 million, or 2 percent, over 1996. This
included a $14 million increase in personnel-related

S-44
<PAGE>
expense, a $5 million increase in credit card processing expense, a $4 million
increase in data processing expense, and a $14 million increase in other
noninterest expense, partially offset by an $18 million decrease in net
occupancy expense and a $4 million decrease in foreclosed asset expense.

Personnel-related expense was $572 million in 1997, an increase of $14
million, or 3 percent, compared to 1996. This increase was primarily due to the
increase in salaries and other compensation expense, a significant portion of
which was due to severance payments related to realignment of departments and to
higher performance-related incentive compensation.

Credit card processing expense was $42 million in 1997, an increase of $5
million, or 14 percent, over 1996 due to higher merchant volumes.

Data processing expense was $26 million in 1997, an increase of $4 million,
or 17 percent, over 1996 due to increased activity in data processing systems
supporting the growth in deposits.

Other noninterest expense increased $14 million in 1997. Of the total
increase, $7.5 million reflected additional expenses incurred to support higher
deposit volumes.

Net occupancy expense was $86 million in 1997, $18 million, or 17 percent,
lower than the previous year. The decrease in net occupancy expense was
primarily due to a $12 million charge related to former banking facilities in
1996. Excluding this charge, net occupancy expense in 1997 declined 6 percent
due to merger-related efficiencies realized in 1997.

Foreclosed asset expense decreased $4 million in 1997. The decrease was
primarily due to lower write-downs and maintenance and selling expenses,
reflecting a 28 percent reduction in the portfolio of foreclosed assets.

MERGER AND INTEGRATION EXPENSE

Merger and integration expense of $124 million in total was recorded in 1996
and 1997 to cover $38 million of personnel expense for severance, retention and
other employee related costs, $54 million for facilities expense related to
redundant banking facilities and $32 million in professional services and other
expense as a result of the combination of Union Bank and BanCal Tri-State
Corporation.

The following table presents merger and integration expense provisions in
1996 and 1997, the cash and noncash utilization of those expense provisions
during the periods, and the resulting liability balances as of December 31, 1996
and 1997.

<TABLE>
<CAPTION>
YEARS ENDED
DECEMBER 31,
---------------------
1996 1997
---------- ---------
(DOLLARS IN
THOUSANDS)
<S> <C> <C>
Balance, accrued merger and integration expense, beginning of period....................... $ -- $ 54,344
Provision for merger and integration costs................................................. 117,464 6,037
Utilization for the period:
Cash..................................................................................... 40,155 35,809
Noncash.................................................................................. 22,965 1,642
---------- ---------
Total utilization...................................................................... 63,120 37,451
---------- ---------
Balance, accrued merger and integration expense, end of period............................. $ 54,344 $ 22,930
---------- ---------
---------- ---------
</TABLE>

At December 31, 1997, the liability balance included amounts primarily for
severance payments that are being paid on a periodic basis and for lease
payments that are continuing over the expected term of the leases.

S-45
<PAGE>
INCOME TAX EXPENSE

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
----------------------------------
1995 1996 1997
---------- ---------- ----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Income before income taxes................................................... $ 506,301 $ 412,350 $ 650,018
Income tax expense........................................................... 193,359 162,892 238,722
Effective tax rate........................................................... 38% 40% 37%
</TABLE>

Our effective tax rate in 1996 was 40% compared with 37% in 1997. Excluding
a $5 million after-tax benefit recognized in 1996 from a settlement with the
State of California Franchise Tax Board for 1985 and 1986, the effective tax
rate in 1996 was 41%. The lower 1997 effective tax rate was the result of an
after-tax refund from the State of California Franchise Tax Board of
approximately $25 million to settle litigation, administration, and audit
disputes covering the years 1975-1987. Excluding the State of California
Franchise Tax Board refund, the effective tax rate for 1997 was also 41%.

CREDIT RISK MANAGEMENT

Our principal business activity is the extension of credit in the form of
loans or other credit substitutes to individuals and businesses. Our policies
and applicable laws and regulations governing the extension of credit require
risk analysis as well as ongoing portfolio and credit management through loan
product diversification, lending limit constraints, credit review and approval
policies, and extensive internal monitoring.

We manage and control credit risk through diversification of the portfolio
by type of loan, industry concentration, dollar limits on multiple loans to the
same borrower, geographic distribution and type of borrower. Geographic
diversification of loans originated through our branch network is generally
within California, Oregon and Washington, which we consider to be our principal
markets. In addition, we will continue to originate and participate in lending
activities outside these states, as well as internationally.

In analyzing our existing loan portfolios, we apply specific monitoring
policies and procedures which vary according to the relative risk profile and
other characteristics of the loans within the various portfolios. Our
residential and consumer loans are relatively homogeneous and no single loan is
individually significant in terms of its size or potential risk of loss.
Therefore, we review our residential and consumer portfolios by analyzing their
performance as a pool of loans. In contrast, our monitoring process for the
commercial, financial and industrial; construction; commercial mortgage; and
foreign loan portfolios includes a periodic review of individual loans. Loans
that are performing but have shown some signs of weakness are evaluated under
more stringent reporting and oversight. We review these loans to assess the
ability of the borrowing entity to continue to service all of its interest and
principal obligations and as a result may adjust the risk grade accordingly. In
the event that we believe that full collection of principal and interest is not
reasonably assured, the loan will be appropriately downgraded and, if warranted,
placed on nonaccrual status, even though the loan may be current as to principal
and interest payments.

We have a Credit Policy Forum, composed of the Chief Credit Officer, senior
credit officers, and appropriate line officers who establish policy, credit
quality criteria, portfolio guidelines and other controls. Credit Administration
together with a series of loan committees, have the responsibility for
administering the credit approval process, as well as the implementation and
administration of our credit policies and lending practices and procedures.
These policies require an extensive evaluation of credit requests and continuing
review of existing credits in order to promptly identify, monitor and quantify
evidence of deterioration of asset credit quality or potential loss.

As another part of the control process, an independent internal credit
review and examination function provides quality assurance that loans and
commitments are made and maintained as prescribed by

S-46
<PAGE>
our credit policies and that the assets are appropriately and timely risk
graded. This includes a review of compliance with our underwriting policies when
the loan is initially extended and subsequent on-site examinations to ensure
continued compliance.

LOANS

The following table shows loans outstanding at year-end by loan type. Loans
outstanding by loan type as a percentage of total loans is shown for 1993
through 1997.
<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------------------------------------------------------------------
1993 1994 1995 1996
-------------------- -------------------- -------------------- --------------------
(DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Domestic:
Commercial, financial and
industrial...................... $ 8,135 46% $ 8,547 47% $ 9,684 47% $ 9,496 45%
Construction...................... 877 5 464 3 370 2 358 2
Mortgage:
Residential..................... 1,964 11 2,253 12 2,642 13 2,961 14
Commercial...................... 2,088 12 1,778 10 2,143 10 2,598 12
--------- --- --------- --- --------- --- --------- ---
Total mortgage................ 4,052 23 4,031 22 4,785 23 5,559 26
Consumer:
Installment..................... 1,351 8 1,644 9 1,812 9 2,063 10
Home equity..................... 1,302 7 1,222 7 1,222 6 1,113 5
Credit card and other
lines of credit............... 207 1 219 1 309 2 303 1
--------- --- --------- --- --------- --- --------- ---
Total consumer................ 2,860 16 3,085 17 3,343 17 3,479 16
Lease financing................... 831 4 829 5 845 4 800 4
--------- --- --------- --- --------- --- --------- ---
Total loans in domestic
offices..................... 16,755 94 16,956 94 19,027 93 19,692 93
--------- --------- --------- ---------
Loans originated in foreign
branches.......................... 1,004 6 1,110 6 1,405 7 1,358 7
--------- --- --------- --- --------- --- --------- ---
Total loans................... $ 17,759 100% $ 18,066 100% $ 20,432 100% $ 21,050 100%
--------- --- --------- --- --------- --- --------- ---
--------- --- --------- --- --------- --- --------- ---

1997
--------------------

<S> <C> <C>
Domestic:
Commercial, financial and
industrial...................... $ 10,747 47%
Construction...................... 293 1
Mortgage:
Residential..................... 2,961 13
Commercial...................... 2,952 13
--------- ---
Total mortgage................ 5,913 26
Consumer:
Installment..................... 2,091 9
Home equity..................... 993 5
Credit card and other
lines of credit............... 270 1
--------- ---
Total consumer................ 3,354 15
Lease financing................... 875 4
--------- ---
Total loans in domestic
offices..................... 21,182 93
---------
Loans originated in foreign
branches.......................... 1,559 7
--------- ---
Total loans................... $ 22,741 100%
--------- ---
--------- ---
</TABLE>

Our lending activities are predominantly domestic, with such loans
comprising approximately 93 percent of the portfolio at December 31, 1997. Total
loans at December 31, 1997 were $22.7 billion, an increase of $1,691 million, or
8 percent, from one year earlier. The increase was primarily attributable to
growth in the commercial, financial and industrial loan portfolio, which
increased $1,251 million from 1996, and to growth in the commercial mortgage
loan portfolio, which increased $354 million.

COMMERCIAL, FINANCIAL AND INDUSTRIAL LOANS. Commercial, financial and
industrial loans represent the largest category in the loan portfolio. These
loans are extended principally to major corporations, middle market businesses,
and small businesses, with no industry concentration exceeding ten percent of
total commercial, financial and industrial loans.

Our commercial market lending originates primarily through its banking
office network. These offices, which rely extensively on relationship oriented
banking, provide many services including cash management services, lines of
credit, accounts receivable and inventory financing. Separately, we originate or
participate in a wide variety of financial services to major corporations. These
services include traditional commercial banking and specialized financing
tailored to the needs of each customer's specific industry. Presently, we are
active in the communications and media, energy related services, retailing and
financial services industries.

S-47
<PAGE>
At December 31, 1997, the commercial, financial and industrial loan
portfolio was $10,747 million, or 47 percent, of the total loan portfolio. The
increase of $1,251 million, or 13 percent, from the previous year-end was
primarily attributable to loans extended to large corporations in industries
where our bank has specialized lending expertise.

CONSTRUCTION AND COMMERCIAL MORTGAGE LOANS. We engage in nonresidential
real estate lending which includes commercial mortgage loans and construction
loans secured by deeds of trust. Construction loans are made primarily to
residential builders and to commercial property developers.

At December 31, 1997, construction loans were $293 million, $65 million
lower than at the end of the previous year. Commercial mortgage loans were
$2,952 million, an increase of $354 million, or 14 percent, from a year earlier.
This increase was primarily attributable to a strong recovery in the California
real estate market reflecting the continuing improvement in the West Coast
economy, particularly in the real estate sector.

RESIDENTIAL MORTGAGE LOANS. We originate residential loans through its
branch network in California, Oregon, and Washington, and periodically purchases
loans in its market area.

At December 31, 1997, residential loans were $2,961 million, unchanged from
the prior year.

CONSUMER LOANS. Through our branch network, we originate consumer loans,
such as vehicle-secured installment loans, home equity lines where advances are
generally secured by second deeds of trust on residential real estate, and
credit card loans.

At December 31, 1996, consumer loans were $3,479 million, or 16 percent of
total loans, compared with $3,354 million, or 15 percent of total loans, at
year-end 1997.

LEASE FINANCING. We enter into direct financing and leveraged leases
through an agreement with a subsidiary of The Bank of Tokyo-Mitsubishi. In
addition, we originate auto leases.

At December 31, 1997, lease financing outstandings were $875 million, an
increase of $75 million from the end of 1996.

LOANS ORIGINATED IN FOREIGN BRANCHES. Our loans originated in foreign
branches consist primarily of short-term credit extensions to financial
institutions located primarily in Asia and short-term commercial and industrial
loans to major Japanese, Korean, and Taiwanese corporations.

At December 31, 1996, loans originated in foreign branches totaled $1,358
million, or 7 percent of the total loan portfolio, compared with $1,559 million,
or 7 percent of total loans, at December 31, 1997.

CROSS-BORDER OUTSTANDINGS

Our cross-border outstandings reflect additional economic and political
risks that are not reflected in domestic outstandings. These risks include those
arising from exchange rate fluctuations and restrictions on the transfer of
funds. The following table sets forth our cross-border outstandings as of
December 31, 1995, 1996 and 1997 for each country where such outstandings
exceeded one percent of total assets. The cross-border outstandings were
compiled based upon category and domicile of ultimate risk and are comprised of
balances with banks, trading securities, securities available for sale,
securities purchased under resale agreements, loans, accrued interest
receivable, acceptances outstanding and investments with foreign entities. The
amounts outstanding for each country exclude local currency outstandings. We do
not

S-48
<PAGE>
have significant local currency outstandings to the individual countries listed
in the following table that are not hedged or are not funded by local currency
borrowings.

<TABLE>
<CAPTION>
PUBLIC CORPORATIONS
FINANCIAL SECTOR AND OTHER TOTAL
INSTITUTIONS ENTITIES BORROWERS OUTSTANDINGS
----------- --------- ------------- -------------
(DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C>
December 31, 1995
Japan....................................................... $ 1,111 $ -- $ 567 $ 1,678
Korea....................................................... 641 -- 269 910

December 31, 1996
Japan....................................................... 1,373 -- 452 1,825
Korea....................................................... 574 8 330 912

The economic condition and the ability of some countries, to which we have
cross-border exposure, to manage their external debt obligations have been
impacted by the Asian economic crisis beginning in the second half of 1997. The
events leading to the crisis included currency devaluations, business failures,
principally caused by excessive debt levels and overcapacity, and some loss of
confidence in the banking system in the affected countries, resulting mainly
from past lending practices and the associated impact of internal and external
economic conditions. The crisis resulted in a substantial erosion of
international confidence, rapid declines in stock market valuations, steep
increases in interest rates and further pressure on the debt structures of the
corporate and financial market participants. International Monetary Fund
programs have been established or are in the process of being established which,
in cooperation with steps being taken by the local governments and other global
institutions, are designed to restore confidence. The success of these programs
is still being evaluated.

We are managing our exposures in these and other impacted countries very
cautiously with a view to minimizing risk and supporting its long-term and
viable customer relationships. High risk situations are being identified and
reduced where possible, and additional reserves against potential credit losses
have been identified and allocated, as determined by management at year end.
None of our cross-border exposure has been affected by the recently announced
debt restructuring program with South Korea.

Although management cannot predict the ultimate impact of the crisis on our
financial position and results of operations since much depends on the effect of
the stabilizing activities already under way, management believes that the
continuation of internal supervision, monitoring and portfolio risk management
practices will be effective in minimizing the impact over and above that already
identified. Increases in non-accrual loans, together with some related increases
in charge-off activity, may occur as events unfold.

Management, in accordance with its established risk management practices,
will also continue to review the impact of the crisis on the stability of other
countries and the potential impact on domestic business activities, particularly
in our core West Coast markets.

ALLOWANCE FOR CREDIT LOSSES

The allowance for credit losses is maintained at a level considered
appropriate by management and is based on an ongoing assessment of the risks
inherent in the credit and lease portfolio, including commitments to provide
financing. The allowance is increased by the provision for credit losses, which
is charged against current period operating results, and is decreased by the
amount of net loans charged off during the period. In evaluating the adequacy of
the allowance for credit losses, management incorporates

S-49
<PAGE>

such factors as collateral value, portfolio composition and concentration, and
trends in local and national economic conditions and the related impact on the
financial strength of our borrowers. While the allowance is segmented by broad
portfolio categories to analyze its adequacy, the allowance is general in nature
and is available for the portfolio in its entirety. Although management believes
that the allowance for possible credit losses is adequate, future provisions
will be exposed to continuing evaluation of inherent risk in the loan portfolio.
Based on the process of evaluation described above, we did not provide for
credit losses during 1997.

The following table presents the allocation of the allowance for credit
losses. The percentages reflect the allowance allocated to each respective loan
category at period end, as a percentage of the total period end balance of that
loan category, as set forth in the "Loans" table at page S-47.

<TABLE>
<CAPTION>
DECEMBER 31,
-------------------------------------------------------------------------------------------------
1993 1994 1995 1996 1997
-------------------- -------------------- -------------------- -------------------- ---------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Domestic:
Commercial, financial and
industrial.............. $ 205,398 2.52% $ 146,784 1.72% $ 174,146 1.80% $ 166,100 1.75% $ 123,610
Construction.............. 106,398 12.13 69,787 15.04 24,752 6.69 5,700 1.59 3,221
Mortgage:
Residential............. 31,409 1.60 23,581 1.05 5,466 0.21 4,000 0.14 2,700
Commercial.............. 139,303 6.67 70,130 3.94 59,931 2.80 39,000 1.50 60,680
--------- --------- --------- --------- ---------
Total mortgage........ 170,712 4.21 93,711 2.32 65,397 1.37 43,000 0.77 63,380
Consumer:
Installment............. 13,100 0.97 12,500 0.76 13,200 0.73 10,400 0.50 11,400
Home equity............. 6,062 0.47 7,143 0.58 5,532 0.45 4,900 0.44 3,600
Credit card and other
lines of credit....... 15,171 7.33 17,101 7.81 32,799 10.61 34,000 11.22 30,500
--------- --------- --------- --------- ---------
Total consumer........ 34,333 1.20 36,744 1.19 51,531 1.54 49,300 1.42 45,500
Lease financing........... 12,500 1.50 10,000 1.21 1,300 0.15 5,300 0.66 4,862
--------- --------- --------- --------- ---------
Total domestic
allowance........... 529,341 3.16 357,026 2.11 317,126 1.67 269,400 1.37 240,573
Foreign allowance........... 14,293 1.42 15,330 1.38 13,968 0.99 9,394 0.69 39,313
Unallocated................. 148,950 190,786 224,055 245,152 171,806
--------- --------- --------- --------- ---------
Total allowance for
credit losses....... $ 692,584 3.90% $ 563,142 3.12% $ 555,149 2.72% $ 523,946 2.49% $ 451,692
--------- --------- --------- --------- ---------
--------- --------- --------- --------- ---------

<CAPTION>
<S> <C>
Domestic:
Commercial, financial and
industrial.............. 1.15%
Construction.............. 1.10
Mortgage:
Residential............. 0.09
Commercial.............. 2.06
Total mortgage........ 1.07
Consumer:
Installment............. 0.55
Home equity............. 0.36
Credit card and other
lines of credit....... 11.30
Total consumer........ 1.36
Lease financing........... 0.56
Total domestic
allowance........... 1.14
Foreign allowance........... 2.52
Unallocated.................
Total allowance for
credit losses....... 1.99%
</TABLE>

At December 31, 1997, we reallocated a portion of the allowance for credit
losses to foreign exposures which include off-balance sheet instruments. The
increase from $9 million at December 31, 1996 to $39 million at December 31,
1997 was primarily precautionary in nature, in light of the recent volatility in
the Asian financial markets. As is the case with the allowance in general,
amounts may be reallocated as circumstances change.

S-50
<PAGE>

The following table presents a reconciliation of changes in our allowance
for credit losses.

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
----------------------------------------------------------
1993 1994 1995 1996 1997
---------- ---------- ---------- ---------- ----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
Balance, beginning of year........................... $ 790,479 $ 692,584 $ 563,142 $ 555,149 $ 523,946
Loans charged off:
Commercial, financial and industrial............... 99,280 105,774 47,524 42,134 58,664
Construction....................................... 58,835 32,151 9,401 3,249 120
Mortgage........................................... 113,791 100,613 29,330 13,483 5,058
Consumer........................................... 39,576 31,806 44,627 56,361 55,336
Lease financing.................................... 11,432 2,940 2,422 2,623 3,601
Foreign(1)......................................... 201 533 295 1,250 --
---------- ---------- ---------- ---------- ----------
Total loans charged off.......................... 323,115 273,817 133,599 119,100 122,779
Recoveries of loans previously charged off:
Commercial, financial and industrial............... 41,552 39,177 39,178 22,341 23,371
Construction....................................... 2,955 5,868 3,195 132 9,054
Mortgage........................................... 6,201 16,228 18,500 12,277 3,292
Consumer........................................... 8,872 8,915 10,924 12,906 14,946
Lease financing.................................... 3,353 435 311 368 351
Foreign(1)......................................... 11,229 627 295 -- --
---------- ---------- ---------- ---------- ----------
Total recoveries of loans previously charged
off............................................ 74,162 71,250 72,403 48,024 51,014
---------- ---------- ---------- ---------- ----------
Net loans charged off.......................... 248,953 202,567 61,196 71,076 71,765
Provision for credit losses.......................... 151,000 73,000 53,250 40,000 --
Foreign translation adjustment and other net
additions (deductions)............................. 58 125 (47) (127) (489)
---------- ---------- ---------- ---------- ----------
Balance, end of year................................. $ 692,584 $ 563,142 $ 555,149 $ 523,946 $ 451,692
---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ----------
Allowance for credit losses to total loans........... 3.90% 3.12% 2.72% 2.49% 1.99%
Provision for credit losses to net loans charged
off................................................ 60.65 36.04 87.02 56.28 --
Recoveries of loans to loans charged off in the
previous year...................................... 24.38 22.05 26.44 35.95 42.83
Net loans charged off to average loans outstanding... 1.37 1.15 0.32 0.34 0.33
Allowance for credit losses to nonaccrual
loans.............................................. 84.82 161.08 266.56 408.48 413.12
</TABLE>

- ------------------------

(1) Foreign loans are those loans originated in foreign branches.

At December 31, 1996, our allowance for credit losses was $524 million, or
2.49% of the total loan portfolio, and 408% of total nonaccrual loans. This
compares with an allowance for credit losses of $452 million, or 1.99% of the
total loan portfolio, and 413% of total nonaccrual loans at December 31, 1997.
At year-end 1996, the unallocated portion of the allowance for credit losses was
$245 million compared with $172 million at the end of 1997.

During 1997, we recorded no provision for credit losses, a decrease of $40
million from 1996. The decline in the provision for credit losses reflected the
improvement in the quality of our loan portfolio, including a 15 percent
reduction in nonaccrual loans.

S-51
<PAGE>
During 1996, we had net loans charged off of $71 million compared to net
loans charged off of $72 million in 1997. Recoveries of loans previously charged
off increased by $3 million, and the percentage of current year recoveries to
loans charged off in the previous year increased from 35.95% in 1996 to 42.83%
in 1997. Loans charged off in 1997 increased by $4 million primarily due to a
$17 million increase in commercial, financial and industrial loans charged off,
partially offset by a $8 million decrease in mortgage loans charged off.

NONPERFORMING ASSETS

Nonperforming assets consist of nonaccrual loans, renegotiated loans, and
foreclosed assets. Nonaccrual loans are those for which management has
discontinued accrual of interest because there exists significant uncertainty as
to the full and timely collection of either principal or interest or such loans
have become contractually past due 90 days in the payment of principal or
interest. For a more detailed discussion of the accounting for nonaccrual loans,
see Note 1 to our Consolidated Financial Statements.

Renegotiated loans are those accruing loans for which, for reasons related
to the borrower's financial difficulties, we have amended the terms of the
original loan agreement and the borrower is performing according to the
renegotiated terms.

Foreclosed assets includes property where we acquired title through
foreclosure or "deed in lieu" of foreclosure. On an ongoing basis, foreclosed
asset values are reviewed and any decline in value is recognized as noninterest
expense in the current period.

The following table presents an analysis of nonperforming assets.

<TABLE>
<CAPTION>
DECEMBER 31,
------------------------------------------------------------
1993 1994 1995 1996 1997
------------ ---------- ---------- ---------- ----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
Commercial, financial and industrial............... $ 145,907 $ 106,447 $ 84,336 $ 56,864 $ 46,392
Construction....................................... 231,148 73,643 40,026 7,349 4,071
Mortgage:
Residential...................................... 61,809 17,020 19,220 11,214 954
Commercial....................................... 367,072 145,207 63,836 52,593 57,921
------------ ---------- ---------- ---------- ----------
Total mortgage................................. 428,881 162,227 83,056 63,807 58,875
Other.............................................. 7,288 7,285 849 247 --
Foreign(1)......................................... 3,331 -- -- -- --
------------ ---------- ---------- ---------- ----------
Total nonaccrual loans......................... 816,555 349,602 208,267 128,267 109,338
Renegotiated loans................................. 4,617 14,843 1,612 -- --
Nonperforming real estate ventures................. 23,256 -- -- -- --
Foreclosed assets.................................. 349,022 56,782 36,992 28,517 20,471
------------ ---------- ---------- ---------- ----------
Total nonperforming assets..................... $ 1,193,450 $ 421,227 $ 246,871 $ 156,784 $ 129,809
------------ ---------- ---------- ---------- ----------
------------ ---------- ---------- ---------- ----------
Allowance for credit losses........................ $ 692,584 $ 563,142 $ 555,149 $ 523,946 $ 451,692
------------ ---------- ---------- ---------- ----------
------------ ---------- ---------- ---------- ----------
Nonaccrual and renegotiated loans to total loans... 4.62% 2.02% 1.03% 0.61% 0.48%
Nonaccrual loans to allowance for credit losses.... 117.90 62.08 37.52 24.48 24.21
Nonperforming assets to total loans, real estate
ventures and foreclosed assets................... 6.58 2.32 1.21 0.74 0.57
Nonperforming assets to total assets............... 4.97 1.71 0.90 0.54 0.42
</TABLE>

- ------------------------

(1) Foreign loans are those loans originated in foreign branches.

S-52
<PAGE>

The following table presents an analysis of loans contractually past due 90
days or more as to interest or principal, but not included in nonaccrual loans
above.

<TABLE>
<CAPTION>
DECEMBER 31,
-----------------------------------------------------
1993 1994 1995 1996 1997
--------- --------- --------- --------- ---------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
Commercial, financial and industrial....................... $ 12,116 $ 3,690 $ 3,752 $ 4,527 $ 450
Construction............................................... 10,711 5,735 1,063 -- --
Mortgage:
Residential.............................................. 14,602 2,123 8,479 8,969 10,170
Commercial............................................... 35,071 -- 3,592 168 1,660
--------- --------- --------- --------- ---------
Total mortgage......................................... 49,673 2,123 12,071 9,137 11,830
Consumer and other......................................... 8,481 8,573 8,854 10,028 7,712
--------- --------- --------- --------- ---------
Total loans 90 days or more past due and still
accruing............................................. $ 80,981 $ 20,121 $ 25,740 $ 23,692 $ 19,992
--------- --------- --------- --------- ---------
--------- --------- --------- --------- ---------
</TABLE>

At December 31, 1997, nonaccrual loans totaled $109 million, a decrease of
$19 million, or 15 percent, from year-end 1996. The decline was primarily
attributable to a $10 million reduction in nonaccrual commercial, financial and
industrial loans and a $10 million reduction in nonaccrual residential mortgage
loans. Foreclosed assets, primarily other real estate owned, decreased by $8
million due to sales of individual assets.

Nonaccrual and renegotiated loans as a percentage of total loans were 0.61%
at December 31, 1996 compared with 0.48% at December 31, 1997. Nonperforming
assets as a percentage of total loans, real estate ventures and foreclosed
assets improved from 0.74% at December 31, 1996 to 0.57% at year-end 1997. At
December 31, 1997, approximately 58 percent of nonaccrual loans were real estate
related.

Total loans 90 days or more past due and still accruing were $24 million at
December 31, 1996 compared with $20 million at December 31, 1997. At December
31, 1996, impaired loans were $114 million and the associated impairment
allowance was $21 million compared with impaired loans of $108 million and an
associated impairment allowance of $9 million at December 31, 1997.

INTEREST FOREGONE

Interest foregone during 1996 and 1997 for loans that were on nonaccrual
status at December 31, 1996 was $9 million and at December 31, 1997 was $6
million. We recognized interest income during 1996 and 1997 for loans that were
on nonaccrual status at December 31, 1996 of $5 million and at December 31, 1997
of $3 million.

S-53
<PAGE>
SECURITIES

The following tables summarize the composition of the securities portfolio
and the gross unrealized gains and losses within the portfolio.

SECURITIES AVAILABLE FOR SALE.

<TABLE>
<CAPTION>
DECEMBER 31,
---------------------------------------------------------------------------------------------------------
1996 1997
1995 ---------------------------------------------- ----------------------------------------------
--------- GROSS GROSS GROSS GROSS
FAIR AMORTIZED UNREALIZED UNREALIZED FAIR AMORTIZED UNREALIZED UNREALIZED FAIR
VALUE COST GAINS LOSSES VALUE COST GAINS LOSSES VALUE
--------- --------- ----------- ----------- --------- --------- ----------- ----------- ---------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
U.S. Treasury..... $ 994,492 $1,137,992 $ 4,993 $ 1,933 $1,141,052 $ 987,374 $ 10,793 $ 170 $ 997,997
Other U.S.
government...... 364,584 687,717 4,993 779 691,931 709,536 6,005 67 715,474
Mortgage-backed
securities...... 448,173 193,531 400 274 193,657 679,692 3,331 265 682,758
State and
municipal....... 132,698 101,006 13,749 -- 114,755 90,937 13,236 -- 104,173
Corporate debt
securities...... -- -- -- -- -- 2,698 311 1 3,008
Equity
securities...... 16,539 19,041 2,553 -- 21,594 28,881 1,596 672 29,805
Foreign
securities...... 4,065 1,136 72 -- 1,208 5,132 39 -- 5,171
--------- --------- ----------- ----------- --------- --------- ----------- ----------- ---------
Total securities
available for
sale.......... $1,960,551 $2,140,423 $ 26,760 $ 2,986 $2,164,197 $2,504,250 $ 35,311 $ 1,175 $2,538,386
--------- --------- ----------- ----------- --------- --------- ----------- ----------- ---------
--------- --------- ----------- ----------- --------- --------- ----------- ----------- ---------
</TABLE>

SECURITIES HELD TO MATURITY.
<TABLE>
<CAPTION>
DECEMBER 31,
----------------------------------------------------------------------------------------------------
1996 1997
1995 ------------------------------------------------ -------------------------------------
----------- GROSS GROSS GROSS GROSS
AMORTIZED AMORTIZED UNREALIZED UNREALIZED FAIR AMORTIZED UNREALIZED UNREALIZED
COST COST GAINS LOSSES VALUE COST GAINS LOSSES
----------- ----------- ----------- ----------- --------- ----------- ----------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
U.S. Treasury........ $ 51,125 $ 50,109 $ 1,735 $ -- $ 51,844 $ 40,092 $ 1,333 $ --
Other U.S.
government......... 138,816 139,188 4,412 -- 143,600 99,520 2,568 --
Mortgage-backed
securities......... 124,375 41,985 2,019 68 43,936 24,477 1,745 14
State and
municipal.......... 48,971 36,914 310 2,199 35,025 24,686 75 1,367
----------- ----------- ----------- ----------- --------- ----------- ----------- -----------
Total securities
held to
maturity......... $ 363,287 $ 268,196 $ 8,476 $ 2,267 $ 274,405 $ 188,775 $ 5,721 $ 1,381
----------- ----------- ----------- ----------- --------- ----------- ----------- -----------
----------- ----------- ----------- ----------- --------- ----------- ----------- -----------

FAIR
VALUE
---------

<S> <C>
U.S. Treasury........ $ 41,425
Other U.S.
government......... 102,088
Mortgage-backed
securities......... 26,208
State and
municipal.......... 23,394
---------
Total securities
held to
maturity......... $ 193,115
---------
---------
</TABLE>

Management of the securities portfolio involves the maximization of return
while maintaining prudent levels of quality and liquidity. At December 31, 1997,
approximately 98 percent of total securities were investment grade.

During the quarter ended December 31, 1995, in accordance with guidance
issued by the Financial Accounting Standards Board, we reclassified from
securities held to maturity to securities available for sale approximately $285
million at amortized cost of U.S. Treasury Notes (fair value $285 million) and
$64 million at amortized cost of municipal bonds (fair value $72 million).

S-54
<PAGE>
ANALYSIS OF SECURITIES PORTFOLIO

The following tables show the remaining contractual maturities and expected
yields of the securities portfolio.

SECURITIES AVAILABLE FOR SALE.
<TABLE>
<CAPTION>
DECEMBER 31, 1997
-------------------------------------------------------------------------------------
MATURITY
-------------------------------------------------------------------------------------
AFTER ONE YEAR AND AFTER FIVE YEARS AND
WITHIN WITHIN WITHIN AFTER TEN
ONE YEAR FIVE YEARS TEN YEARS YEARS
---------------------- ---------------------- ------------------------ -----------
AMOUNT YIELD(4) AMOUNT YIELD(4) AMOUNT YIELD(4) AMOUNT
--------- ----------- --------- ----------- ----------- ----------- -----------
(DOLLARS IN THOUSANDS)
-------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
U.S. Treasury....................... $ 150,048 6.22% $ 837,326 6.31% $ -- -- % $ --
Other U.S. government............... 99,940 6.49 609,596 6.38 -- -- --
Mortgage-backed securities(1)....... 53,108 6.82 626,584 6.41 -- -- --
State and municipal(2).............. 14,944 10.49 26,409 9.90 12,971 11.09 36,613
Corporate debt securities........... -- -- 1,432 17.31 1,266 12.42 --
Equity securities(3)................ -- -- -- -- -- -- --
Foreign securities.................. 3,419 14.30 -- -- 1,713 6.29 --
--------- --------- ----------- -----------
Total securities available for
sale.......................... $ 321,459 6.69% $2,101,347 6.41% $ 15,950 10.68% $ 36,613
--------- --------- ----------- -----------
--------- --------- ----------- -----------

TOTAL AMORTIZED
----------------------
YIELD(4) AMOUNT YIELD(4)
----------- --------- -----------

<S> <C> <C> <C>
U.S. Treasury....................... -- % $ 987,374 6.30%
Other U.S. government............... -- 709,536 6.40
Mortgage-backed securities(1)....... -- 679,692 6.44
State and municipal(2).............. 11.33 90,937 10.74
Corporate debt securities........... -- 2,698 15.02
Equity securities(3)................ -- 28,881 --
Foreign securities.................. -- 5,132 11.63
---------
Total securities available for
sale.......................... 11.33% $2,504,250 6.48%
---------
---------
</TABLE>

SECURITIES HELD TO MATURITY.
<TABLE>
<CAPTION>
DECEMBER 31, 1997
---------------------------------------------------------------------------------------
MATURITY
---------------------------------------------------------------------------------------
AFTER ONE YEAR AND AFTER FIVE YEARS AND
WITHIN WITHIN WITHIN AFTER TEN
ONE YEAR FIVE YEARS TEN YEARS YEARS
------------------------ ---------------------- ------------------------ -----------
AMOUNT YIELD(4) AMOUNT YIELD(4) AMOUNT YIELD(4) AMOUNT
----------- ----------- --------- ----------- ----------- ----------- -----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C> <C>
U.S. Treasury.......................... $ -- -- % $ 40,092 7.56% $ -- -- % $ --
Other U.S. government.................. 10,000 8.00 89,520 7.72 -- -- --
Mortgage-backed securities(1).......... 3,622 4.88 20,855 9.03 -- -- --
State and municipal(2)................. 9,077 9.19 -- -- 2,596 6.35 13,013
----------- --------- ----------- -----------
Total securities held to maturity.... $ 22,699 7.98% $ 150,467 7.86% $ 2,596 6.35% $ 13,013
----------- --------- ----------- -----------
----------- --------- ----------- -----------

TOTAL AMORTIZED
----------------------
YIELD(4) AMOUNT YIELD(4)
----------- --------- -----------

<S> <C> <C> <C>
U.S. Treasury.......................... -- % $ 40,092 7.56%
Other U.S. government.................. -- 99,520 7.75
Mortgage-backed securities(1).......... -- 24,477 8.42
State and municipal(2)................. 5.77 24,686 7.09
---------
Total securities held to maturity.... 5.77% $ 188,775 7.71%
---------
---------
</TABLE>

- ------------------------------

(1) Expected maturities may differ from contractual maturities because borrowers
have the right to call or prepay obligations, with or without call or
prepayment penalties.

(2) Yields on tax-exempt municipal securities are presented on a
taxable-equivalent basis using the current federal statutory rate of 35
percent.

(3) Equity securities do not have a stated maturity and are included in the
total column only.

(4) Yields are based on amortized cost.

S-55
<PAGE>
LOAN MATURITIES

The following table presents our loans by maturity.

<TABLE>
<CAPTION>
DECEMBER 31, 1997
--------------------------------------------------------
AFTER
ONE YEAR
WITHIN AND WITHIN AFTER
ONE YEAR FIVE YEARS FIVE YEARS TOTAL
------------- ------------ ------------ -------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C>
Domestic:
Commercial, financial and industrial................. $ 4,102,910 $ 4,477,317 $ 2,166,952 $ 10,747,179
Construction......................................... 173,504 119,829 -- 293,333
Mortgage:
Residential........................................ 4,230 32,000 2,925,003 2,961,233
Commercial......................................... 228,955 1,085,913 1,636,939 2,951,807
------------- ------------ ------------ -------------
Total mortgage................................... 233,185 1,117,913 4,561,942 5,913,040
Consumer:
Installment........................................ 136,264 1,801,620 152,868 2,090,752
Home equity........................................ 2,816 38,570 951,530 992,916
Credit card and other lines of credit.............. 270,045 52 -- 270,097
------------- ------------ ------------ -------------
Total consumer................................... 409,125 1,840,242 1,104,398 3,353,765
Lease financing...................................... 83,478 606,904 184,478 874,860
------------- ------------ ------------ -------------
Total loans in domestic offices.................. 5,002,202 8,162,205 8,017,770 21,182,177
Loans originated in foreign branches................... 1,515,844 25,627 17,760 1,559,231
------------- ------------ ------------ -------------
Total loans...................................... $ 6,518,046 $ 8,187,832 $ 8,035,530 22,741,408
------------- ------------ ------------
------------- ------------ ------------
Allowance for credit losses.................... 451,692
-------------
Loans, net....................................... $ 22,289,716
-------------
-------------
Total fixed rate loans due after one year.............. $ 5,353,709
Total variable rate loans due after one year........... 10,869,653
-------------
Total loans due after one year................... $ 16,223,362
-------------
-------------
</TABLE>

CERTIFICATES OF DEPOSIT OF $100,000 AND OVER

The following table presents domestic certificates of deposit of $100,000
and over by maturity.

<TABLE>
<CAPTION>
DECEMBER 31,
1997
--------------------
(DOLLARS IN
THOUSANDS)
<S> <C>
Three months or less........................................................................ $ 2,684,438
Over three months through six months........................................................ 1,163,014
Over six months through twelve months....................................................... 261,739
Over twelve months.......................................................................... 154,948
-----------
Total domestic certificates of deposit of $100,000 and over............................. $ 4,264,139
-----------
-----------
</TABLE>

We offer certificates of deposit of $100,000 and over at market rates of
interest. Many of these certificates are issued to customers, both public and
private, who have done business with us for an extended period. We expect that
as these deposits become due, the majority will continue to be renewed at market
rates of interest.

Substantially all of our deposits in foreign branches are certificates of
deposit of $100,000 and over and mature in less than one year.

S-56
<PAGE>
BORROWED FUNDS

The following table presents information on our borrowed funds, excluding
subordinated capital notes.

<TABLE>
<CAPTION>
DECEMBER 31,
----------------------------------------
1995 1996 1997
------------ ------------ ------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C>
Federal funds purchased and securities sold under repurchase agreements
with weighted average interest rates of 4.96% at December 31, 1995,
5.09% at December 31, 1996 and 5.38% at December 31, 1997............. $ 1,195,058 $ 1,322,654 $ 1,335,884
Commercial paper, with weighted average interest rates of 5.75% at
December 31, 1995, 5.34% at December 31, 1996 and 5.64% at December
31, 1997.............................................................. 1,389,870 1,495,463 966,575
Other borrowed funds, with weighted average interest rates of 5.78% at
December 31, 1995, 5.66% at December 31, 1996 and 6.23% at December
31, 1997.............................................................. 1,064,472 749,422 476,010
------------ ------------ ------------
Total borrowed funds................................................ $ 3,649,400 $ 3,567,539 $ 2,778,469
------------ ------------ ------------
------------ ------------ ------------
Federal funds purchased and securities sold under repurchase agreements:
Maximum outstanding at any month end.................................. $ 1,517,999 $ 1,322,654 $ 1,575,930
Average balance during the year....................................... 1,384,762 933,433 1,097,707
Weighted average interest rate during the year........................ 5.70% 5.05% 5.33%

Commercial paper:
Maximum outstanding at any month end.................................. $ 1,591,712 $ 1,854,576 $ 1,876,135
Average balance during the year....................................... 1,448,739 1,620,087 1,637,070
Weighted average interest rate during the year........................ 5.98% 5.40% 5.49%

Other borrowed funds:
Maximum outstanding at any month end.................................. $ 1,319,444 $ 1,697,236 $ 851,694
Average balance during the year....................................... 731,759 1,119,051 635,900
Weighted average interest rate during the year........................ 5.82% 5.59% 5.42%
</TABLE>

CAPITAL ADEQUACY AND DIVIDENDS

Our principal capital objectives are to support future growth, to protect
depositors, to absorb any unanticipated losses and to comply with various
regulatory requirements. Management believes that we have retained our capital
at a level which supports our risk structure, as well as providing for
anticipated growth of current business activities and strategic expansion.

Total shareholders' equity was $2,679 million at December 31, 1997, an
increase of $184 million from year-end 1996. This change was primarily a result
of $411 million of net income for 1997, offset by the redemption of $135 million
in preferred stock and dividends on common and preferred stock of $97 million.

We offer a dividend reinvestment plan that allows shareholders to reinvest
dividends in our common stock at 5 percent below the market price. At December
31, 1997, The Bank of Tokyo-Mitsubishi was not a participant in the plan.

Capital adequacy depends on a variety of factors including asset quality and
risk profile, liquidity, stability of earnings, competitive and economic
conditions, and management. We believe that the current

S-57
<PAGE>
level of profitability, coupled with a prudent dividend policy, is adequate to
support normal growth in operations while meeting regulatory capital guidelines.

The following table summarizes our risk-based capital, risk-weighted assets,
and risk-based capital ratios.

<TABLE>
<CAPTION>
DECEMBER 31, MINIMUM
------------------------------------------------------------------------- REGULATORY
1993 1994 1995 1996 1997 REQUIREMENT
------------- ------------- ------------- ------------- ------------- -------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
CAPITAL COMPONENTS:
Tier 1 capital................. $ 1,952,045 $ 2,070,554 $ 2,355,057 $ 2,395,580 $ 2,587,071
Tier 2 capital................. 702,652 626,903 591,266 551,074 601,102
------------- ------------- ------------- ------------- -------------
Total risk-based capital..... $ 2,654,697 $ 2,697,457 $ 2,946,323 $ 2,946,654 $ 3,188,173
------------- ------------- ------------- ------------- -------------
------------- ------------- ------------- ------------- -------------
Risk-weighted assets........... $ 21,992,647 $ 22,419,516 $ 25,179,489 $ 26,390,288 $ 28,862,340
------------- ------------- ------------- ------------- -------------
------------- ------------- ------------- ------------- -------------
Quarterly average assets....... $ 23,624,622 $ 23,868,729 $ 27,073,158 $ 28,496,355 $ 30,334,507
------------- ------------- ------------- ------------- -------------
------------- ------------- ------------- ------------- -------------
CAPITAL RATIOS:
Total risk-based capital....... 12.07% 12.03% 11.70% 11.17% 11.05% 8.0%
Tier 1 risk-based capital...... 8.88 9.24 9.35 9.08 8.96 4.0
Leverage ratio(1).............. 8.26 8.67 8.70 8.41 8.53 4.0
</TABLE>

- ------------------------

(1) Tier 1 capital divided by quarterly average assets, excluding goodwill.

For regulatory purposes, our capital computations are based on risk-adjusted
Tier 1 and total capital. Our Tier 1 risk-based capital ratio was 9.08% and our
total risk-based capital ratio was 11.17% at December 31, 1996 compared to 8.96%
for our Tier 1 risk-based capital ratio and 11.05% for our total risk-based
capital ratio at December 31, 1997. The decrease in the capital ratios was
attributable to the redemption of $135 million of preferred stock in the third
quarter of 1997, partly offset by retained earnings growing faster than both
risk-weighted assets and average assets. As of December 31, 1997, management
believes the capital ratios of our bank met all regulatory minimums of a
"well-capitalized" institution.

YEAR ENDED DECEMBER 31, 1996 COMPARED TO YEAR ENDED DECEMBER 31, 1995

Net income in 1996 was $249 million compared with $313 million in 1995.
Excluding the effects of the $72 million after-tax charge for merger-integration
expense, net income improved as a result of higher net interest income, higher
noninterest income, and lower credit loss provision expense than in 1995.

Net income applicable to common stock was $238 million, or $1.36 per diluted
common share, in 1996 compared with $302 million, or $1.73 per diluted common
share, in 1995.

The return on average assets was 0.89% in 1996 versus 1.22% in 1995. The
return on average common equity was 10.24% in 1996 compared with 13.73% in 1995.

Net interest income on a taxable-equivalent basis increased by $23 million,
or 2 percent, over 1995. Average loans increased $1,753 million, or 9 percent,
and the net interest margin decreased 30 basis points to 4.75%.

Noninterest income increased by $23 million, or 6 percent, over 1995.
Service charges on deposits, trust and investment management fees, credit card
merchant fees, brokerage commissions and fees, securities gains, and other
revenue collectively grew 11 percent and accounted for $32 million of the growth
in noninterest income. This increase was partially offset by a $6 million
decrease in foreign exchange trading gains.

S-58
<PAGE>
The provision for credit losses was $40 million in 1996, $13 million, or 25
percent, lower than in 1995, reflecting the improved quality of the loan
portfolio.

Noninterest expense, excluding merger and integration expense, increased by
$39 million, or 4 percent, from 1995. Personnel-related expense increased $21
million, or 4 percent, due partially to increased contract labor used to augment
staffing requirements as a residual effect of the merger. Net occupancy expense
increased $10 million, or 11 percent, due to a $12 million one-time charge in
1996 related to former banking facilities. This was offset by a 2 percent
decrease in net occupancy expense due to the closure of 20 branches late in the
third quarter of 1996. Credit card processing expense increased $6 million, or
19 percent, in 1996 due to higher merchant volumes. Advertising and public
relations expense increased $8 million, or 38 percent, over 1995 due primarily
to expanded activities in 1996 to increase awareness of our bank, following the
April 1, 1996 combination of Union Bank and BanCal Tri-State Corporation and its
subsidiary. In 1996, regulatory authority assessments expense declined $19
million, or 83 percent, primarily because the Federal Deposit Insurance
Corporation decided to eliminate insurance assessments for all of 1996. Merger
and integration expense was $117 million in 1996.

Income tax expense was $30 million lower in 1996 than in 1995, primarily due
to lower taxable income. The effective rate increased from 38% in 1995 to 40% in
1996 primarily due to a $3 million after-tax benefit recognized in 1995 from a
favorable settlement of an Internal Revenue Service examination of 1989 and
1990.

Total loans at December 31, 1996 were $21.0 billion, an increase of $0.6
billion, or 3 percent, over year-end 1995. Commercial, financial and industrial
loans declined $188 million, or 2 percent, from the previous year, primarily due
to planned reductions from a portfolio overlap arising from the merger and a
reduction in low margin lending. At year-end 1996, construction loans decreased
$12 million, or 3 percent, while commercial mortgages increased $455 million, or
21 percent, from 1995. This increase in commercial mortgages reflected the
continuing improvement in the West Coast economy, particularly the real estate
sector. It was primarily attributable to new originations of mini-perm loans,
ranging in size from $1 million to $10 million, resulting from a vigorous
marketing program. At December 31, 1996 residential loans were $319 million, or
12 percent, higher than the previous year as the favorable interest rate
environment and a stronger housing market continued to generate significant
opportunities for residential mortgage lenders. Consumer loans increased $136
million, or 4 percent, from 1995 due primarily to increases in direct and
indirect auto loans for used vehicles, partially offset by a decrease in home
equity balances.

Total nonperforming assets were $157 million at December 31, 1996, $90
million, or 36 percent, lower than one year earlier. The decline was primarily
attributable to a $27 million, or 33 percent, reduction in nonaccrual
commercial, financial and industrial loans and a $33 million, or 82 percent,
reduction in nonaccrual construction loans, due to a combination of note sales,
payoffs, and upgrades. Foreclosed assets, primarily other real estate owned,
decreased by $8 million, or 23 percent, from 1995, due to sales of individual
assets. Net loan charge-offs in 1996 were $71 million compared to net loans
charged off of $61 million in 1995. Recoveries of loans previously charged off
decreased by $24 million, despite an increase in the percentage of recoveries in
1996 to loans charged off in the previous year from 26.44% in 1995 to 35.95% in
1996. Loans charged off in 1996 decreased by $14 million due to a reduction in
new nonperforming assets in 1996 and a reduction in nonaccrual and
underperforming loans, partly offset by a $12 million increase in consumer loans
charged off, primarily attributable to credit card loans.

At December 31, 1996, the Tier 1 risk-based capital ratio was 9.08% and the
total risk-based capital ratio was 11.17% compared with a Tier 1 risk-based
capital ratio of 9.35% and a total risk-based capital ratio of 11.70% at
December 31, 1995.

S-59
<PAGE>
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

GENERAL

Market risk is the risk of loss to future earnings, to fair values, or to
future cash flows that may result from changes in the price of a financial
instrument. The value of a financial instrument may change as a result of
changes in interest rates, foreign currency exchange rates, commodity prices,
equity prices and other market changes that affect market risk sensitive
instruments. Market risk is attributed to all market risk sensitive financial
instruments, including securities, loans, deposits, borrowings, as well as
derivative instruments. Our exposure to market risk is a function of its asset
and liability management activities, its trading activities for its own account,
and its role as a financial intermediary in customer-related transactions. The
objective of market risk management is to avoid excessive exposure of our
earnings and equity to loss and to reduce the volatility inherent in financial
instruments.

The management of market risk is governed by policies reviewed and approved
annually by our Board of Directors. Our Board of Directors delegates
responsibility for market risk management to the Asset & Liability Management
Committee (the "A&L Management Committee"), who reports quarterly to our Board
of Directors on activities related to the management of market risk. As part of
the management of our market risk, the A&L Management Committee may direct
changes in the mix of assets and liabilities and the use of derivative
instruments such as interest rate swaps, caps and floors. The A&L Management
Committee also reviews and approves all major funding, market risk-management
programs, and market risk limits. The Chief Financial Officer, as chairman of
the A&L Management Committee, is responsible for companywide management of
market risk. The Treasurer is responsible for implementing funding, investment,
and hedging strategies designed to manage this risk. On a day-to-day basis, the
oversight of market risk management takes place at a centralized level within
the Risk Monitoring Unit. The Risk Monitoring Unit is responsible for measuring
risks to ensure compliance with all market risk limits and guidelines
incorporated within the policies and procedures established by the A&L
Management Committee. The Risk Monitoring Unit reports monthly to the A&L
Management Committee on the effectiveness of our hedging activities, on trading
risk exposures, and on compliance with policy limits. In addition, periodic
reviews by internal audit, regulators and independent accountants provide
further evaluation of controls over the risk management process.

We have separate and distinct methods for managing the market risk
associated with our trading activities and our asset and liability management
activities, as described below.

INTEREST RATE RISK MANAGEMENT (OTHER THAN TRADING)

We engage in asset and liability management activities with the objective of
reducing adverse changes in earnings as a result of changes in interest rates.
The management of interest rate risk relates to the timing and magnitude of the
repricing of assets compared to liabilities and has, as its objective, the
control of risks associated with movements in interest rates.

The Asset & Liability Management Policy approved by our Board of Directors
requires monthly monitoring of interest rate risk by the A&L Management
Committee. As part of the management of our interest rate risk, the A&L
Management Committee may direct changes in the composition of the balance sheet
and the extent to which we utilize off-balance sheet derivative instruments such
as interest rate swaps, floors, and caps.

Our balance sheet is "asset-sensitive", which means that assets generally
reprice more quickly than liabilities. An asset-sensitive balance sheet tends to
reduce net interest income when interest rates decline and to increase net
interest income when interest rates rise.

One method of measuring interest rate risk is by measuring the interest rate
sensitivity gap, which is the difference between earning assets and liabilities
maturing or repricing within specified periods. The table on page S-63 presents
such an analysis, which reflects assumptions as to the rate sensitivity of

S-60
<PAGE>

deposits without contractual maturities or repricing dates. These include demand
deposits, money market demand accounts, and savings deposits. Additional
assumptions such as prepayment estimates for residential mortgages and
mortgage-backed securities are made to reflect the probable behavior of those
assets. The section of the table on page S-63 entitled "Interest Rate Risk
Management Positions" presents the effects of the securities portfolio and of
derivatives used for hedging, such as interest rate swaps and floors, in
reducing the interest rate sensitivity gap primarily for LIBOR-based loans.

The table on page S-63 shows that our assets that are rate sensitive within
one year exceeded liabilities within that same period by $4.9 billion at
December 31, 1997. Adjusted for the effects of the securities portfolio and
derivatives used for hedging, this cumulative gap was reduced to $2.5 billion.

Gap analysis has significant limitations as a method for measuring interest
rate risk since changes in interest rates do not affect all categories of assets
and liabilities in the same way. To address these limitations, we use a
simulation model to quantify the impact of changing interest rates on net
interest income. A frequency distribution of simulated 12-month net interest
income outcomes based on rate scenarios produced through a Monte Carlo rate
generation process is prepared monthly to determine statistically the mean net
interest income. The amount of Earnings at Risk, defined as the potential
negative change in net interest income, is measured at a 97.5 percent confidence
level and is managed within the limit established in our Board of Director's
Asset & Liability Policy at 5 percent of mean net interest income. Based on the
December 31, 1997 balance sheet, the Earnings at Risk was $23.0 million or 1.80%
of mean net interest income.

An additional limit established by our Board of Director's Asset & Liability
Policy is that the negative change in simulated net interest income for 12
months under single interest rate shock scenarios, up or down 200 basis points,
must be no more than 8 percent of the mean net interest income. Based on the
December 31, 1997 balance sheet, the negative change for a downward shock of 200
basis points was $51.8 million or 4.05% of mean net interest income.

TRADING ACTIVITIES

We enter into trading account activities primarily as a financial
intermediary for customers, and, to a lesser extent, for our own account. By
acting as a financial intermediary, we are able to provide our customers with
access to a wide range of products from the securities, foreign exchange, and
derivatives markets. In acting for our own account, we may take positions in
some of these instruments with the objective of generating trading profits.
These activities expose us to two primary types of market risk: interest rate
and foreign currency exchange risk.

In order to manage interest rate and foreign currency exchange risk
associated with our trading activities, we use a variety of non-statistical
methods including: position limits for each trading activity, daily marking of
all positions to market, daily profit and loss statements, position reports, and
independent verification of all inventory pricing. Additionally, the Risk
Management Unit reports positions and profits and losses daily to the Treasurer
and trading managers and weekly to the Chief Financial Officer. The A&L
Management Committee is provided reports on a monthly basis. We believe that
these procedures, which stress timely communication between the Risk Management
Unit and senior management, are the most important elements of the risk
management process.

We use a form of Value at Risk methodology to measure the overall market
risk inherent in our trading account activities. Under this methodology,
management statistically calculates, with 97.5 percent confidence, the potential
loss in fair value that we might experience if an adverse shift in market prices
were to occur within a period of 5 business days. The amount of Value at Risk is
managed within limits well below the maximum limit established by Board policy
at 0.5% of shareholders' equity. The Value at Risk model incorporates a number
of key assumptions, including assumed holding period and historical volatility
based on 3 years of historical market data updated quarterly.

S-61
<PAGE>
During 1997 our foreign exchange trading Value at Risk averaged $73 thousand
and peaked at $147 thousand. The low Value at Risk was $32 thousand.
Correspondingly, our securities trading Value at Risk averaged $558 thousand and
peaked at $717 thousand. The low Value at Risk was $439 thousand.

Our interest rate derivatives contracts include $2.4 billion of derivative
contracts entered into as an accommodation for customers. We act as an
intermediary and we match these contracts at a profit with contracts with The
Bank of Tokyo-Mitsubishi or other dealers, thus neutralizing the related market
risk. We maintain responsibility for the credit risk associated with these
contracts.

LIQUIDITY RISK

Liquidity risk represents the potential for loss as a result of limitations
on our ability to adjust its future cash flows to meet the needs of depositors
and borrowers and to fund operations on a timely and cost-effective basis. The
Asset & Liability Management Policy approved by our Board of Directors requires
quarterly reviews of our liquidity by the A&L Management Committee, which is
composed of bank senior executives. Our liquidity draws upon the strength of our
extensive retail and commercial market business franchise, coupled with the
ability to obtain funds for various terms in a variety of domestic and
international money markets. Liquidity is managed through the funding and
investment functions of the Treasury Division.

Core deposits provide us with a sizable source of relatively stable and
low-cost funds. In the third quarter of 1998, lower cost sources of funds, which
include noninterest bearing deposits and interest bearing core deposits, funded
63 percent of average earning assets. Most of the remaining funding was provided
by short-term borrowing in the form of negotiable certificates of deposit,
foreign deposits, federal funds purchased and securities sold under repurchase
agreements, and other borrowings. In the third quarter 1998, we increased our
Commercial Paper program by $100 million.

Our average core deposits, which include demand deposits, money market
demand accounts, and savings and consumer time deposits, combined with average
common shareholder's equity, funded 61 percent of average total assets of $29.7
billion for the year ended December 31, 1997. Most of the remaining funding was
provided by short-term borrowings in the form of negotiable certificates of
deposit, foreign deposits, federal funds purchased and securities sold under
repurchase agreements, commercial paper and other borrowings.

Liquidity may also be provided by the sale or maturity of assets. Such
assets include interest bearing deposits in banks, federal funds sold and
securities purchased under resale agreements, and trading account securities.
The aggregate of these assets averaged $1.8 billion during 1997. Additional
liquidity may be provided by investment securities available for sale which
amounted to $2.5 billion at December 31, 1997, and by loan maturities. At
December 31, 1997, $6.5 billion of loans were scheduled to mature within one
year.

S-62
<PAGE>
The following table summarizes our interest rate sensitivity based on
expected repricings in the time frames indicated for the balance sheet and
interest rate derivatives as of December 31, 1997.

<TABLE>
<CAPTION>
DECEMBER 31, 1997
----------------------------------------------------------
AMOUNTS MATURING OR REPRICING IN
----------------------------------------------------------
0-12 MONTHS 1-5 YEARS AFTER 5 YEARS TOTAL
------------- ------------- ------------- -------------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C>
ASSETS:
Federal funds sold and securities purchased under
resale agreements................................ $ 24,335 $ -- $ -- $ 24,335
Interest bearing deposits in banks................. 633,421 -- -- 633,421
Trading account assets............................. 394,313 -- -- 394,313
Loans.............................................. 17,320,010 3,926,152 1,495,246 22,741,408
Other assets(1)(2)................................. 1,217,060 1,111,518 1,736,049 4,064,627
------------- ------------- ------------- -------------
Total assets (except securities)............... 19,589,139 5,037,670 3,231,295 27,858,104
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
LIABILITIES AND SHAREHOLDERS' EQUITY:
Interest bearing deposits:
Interest bearing checking(1)(3).................. 180,074 1,260,520 -- 1,440,594
Money market demand accounts(1)(3)............... 1,353,636 2,671,392 -- 4,025,028
Savings(1)(3).................................... 166,562 1,165,932 -- 1,332,494
Other time deposits(1)........................... 7,208,342 434,309 6,063 7,648,714
Federal funds purchased and securities sold under
repurchase agreements............................ 1,335,884 -- -- 1,335,884
Other borrowed funds............................... 1,442,585 -- -- 1,442,585
Subordinated capital notes......................... 348,000 -- -- 348,000
Demand deposit accounts(1)(4)...................... 2,654,863 6,194,681 -- 8,849,544
Other liabilities(1)(2)............................ -- -- 1,483,123 1,483,123
Shareholders' equity(2)............................ -- -- 2,679,299 2,679,299
------------- ------------- ------------- -------------
Total liabilities and shareholders' equity..... $ 14,689,946 $ 11,726,834 $ 4,168,485 $ 30,585,265
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
Gap before risk management positions............... $ 4,899,193 $ (6,689,164) $ (937,190) $ (2,727,161)
Cumulative gap before risk management positions.... $ 4,899,193 $ (1,789,971) $ (2,727,161)

INTEREST RATE RISK MANAGEMENT POSITIONS:
Securities(1)...................................... 366,467 2,214,199 146,495 2,727,161
Interest rate swaps................................ (425,000) 425,000 -- --
Interest rate floors(5)............................ (2,350,000) 2,350,000 -- --
------------- ------------- ------------- -------------
Gap adjusted for risk management positions......... $ 2,490,660 $ (1,699,965) $ (790,695) $ --
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
Cumulative gap adjusted for risk management
positions........................................ $ 2,490,660 $ 790,695 $ -- $ --
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
</TABLE>

- ------------------------

(1) These balance sheet classifications do not conform to the classification on
the Consolidated Balance Sheets on F-3.

(2) Items that neither reprice nor mature are included in the "After 5 Years"
column.

(3) Interest rate sensitivity of non-maturity deposit accounts are based on
assumptions for a declining interest rate scenario since our balance sheet
is asset-sensitive.

(4) 70 percent of the demand deposit account balance is assumed to be "core"
deposits, which are not sensitive to interest rate changes.

(5) Floors purchased affect interest rate sensitivity in a declining interest
rate scenario.

S-63
<PAGE>
YEAR 2000

The year 2000 problem exists because many computer programs use only the
last two digits to refer to a year. This convention could affect date-sensitive
calculations that treat "00" as the year 1900, rather than as the year 2000.
Another issue is that the year 2000 is a leap year and some programs may not
properly provide for February 29, 2000.

This discussion of the implications of the year 2000 problem for us contains
numerous forward-looking statements based on inherently uncertain information.
The cost of the project and the date on which we plan to complete the internal
year 2000 modifications are based on management's best estimates of future
events. The material assumptions underlying the estimated cost are:

- the continued availability of internal and external resources,

- the cost of these resources,

- the time required to accomplish the tasks,

- the cost of needed equipment.

For more detailed information about our costs for our year 2000 program, see
page . We cannot guarantee, however, these estimates, and actual results could
differ. Moreover, although management believes it will be able to make the
necessary modifications in advance, failure to modify the systems may have a
material adverse effect on us.

In addition, we place a high degree of reliance on computer systems of third
parties, such as customers, vendors, and other financial and governmental
institutions. Although we are assessing the readiness of these third parties and
preparing contingency plans, the failure of these third parties to modify their
systems in advance of December 31, 1999, may have a material adverse effect on
us.

We estimate that the total cost of our year 2000 project will be
approximately $50 million, of which $10 million relates to capital expenditures
that we will capitalize and depreciate over their useful lives. We will include
the remaining $40 million in noninterest expense in the period incurred. As of
December 31, 1998, we had spent $22 million on our year 2000 project, $2 million
in 1997 and $20 million in 1998. Of the $22 million spent as of December 31,
1998, $6 million related to capital expenditures, $1 million in 1997 and $5
million in 1998. Of the estimated $28 million remaining to be spent, an
estimated $4 million is for capital expenditures. We are funding the cost of our
year 2000 project with normal operating cash and are staffing it with external
resources as well as internal staff re-deployed from less time-sensitive
assignments. Estimated total cost could change further as analysis continues.

READINESS PREPARATION

Resolution of the year 2000 problem is among our highest priorities, and we
are preparing for the century change with a comprehensive enterprise-wide year
2000 program. We have identified all of the major systems and have sought
external and internal resources to renovate and test the systems. We are testing
purchased software, internally developed systems and systems supported by
external parties as part of the program. We are evaluating customers and vendors
that have significant relationships with us to determine whether they are
adequately preparing for the year 2000. In addition, we are developing
contingency plans to reduce the impact of some potential events that may occur.
We cannot guarantee, however, that the systems of vendors or customers with whom
we do business will be completed on a timely basis, or that contingency plans
will shield operations from failures that may occur.

Our year 2000 program is comprised of numerous individual projects that
address the following broad areas:

- data processing systems,

S-64
<PAGE>

- telecommunications and data networks,

- building facilities and security systems,

- vendor risk,

- customer risk,

- contingency planning, and

- communications.

We have identified over 2,000 individual projects. The projects vary in
size, importance and materiality, from large undertakings, such as remediating
complicated data systems, to smaller, but still important projects, such as
installing compliant computer utility systems or assuring that building
equipment will perform properly. The program continues to evolve as we identify
new projects to keep up with increased understanding of year 2000 implications
and evolving external requirements. Virtually all of the projects currently
identified have begun, and approximately two-thirds have been completed.

We assign projects a priority, indicating the importance of the function to
our continuing operation. This prioritization facilitates reporting on projects
based on their relative importance. We have prioritized projects as "Critical"
and "Non-Critical." Critical projects are further prioritized as "Mission
Critical" and "Other Critical."

Mission Critical projects are defined as:

- systems vital to the continuance of a broad core business activity;

- functions, the interruption of which for longer than 3 days would threaten
our viability; or

- functions that provide the environment and infrastructure necessary to
continue the broad core business activities.

Other Critical projects are defined as:

- other customer and accounting systems;

- functions supporting delivery of information and service to customers;

- administrative systems, the interruption of which for longer than 2 weeks
would cause severe business impact; or

- functions that provide the environment and infrastructure necessary for
delivery of the above systems and functions.

We plan to complete all projects currently identified prior to the year
2000, with special emphasis placed on those prioritized as Mission Critical or
Other Critical. Failure to complete an Other Critical project would not
necessarily have a material adverse effect on us.

The most important projects are the Mission Critical application systems
upon which we rely for our principal business functions. We have renovated and
tested all of these systems. However, outside servicers operate three of them.
The outside servicers have renovated and tested each of these systems, but we
still need to validate them.

The following table presents actual and estimated progress with Mission
Critical projects.

S-65
<PAGE>

MISSION CRITICAL APPLICATION COMPLETION

<TABLE>
<CAPTION>
% COMPLETED:
---------------
<S> <C>
Actual:
June 1998.................................................................... 10%
September 1998............................................................... 38%
December 1998................................................................ 90%

Estimated:
March 1999................................................................... 100%
</TABLE>

We have also achieved substantial progress with systems prioritized as Other
Critical. As of December 31, 1998, 63% of these systems were complete.
Substantially all are expected to be complete by March 31, 1999.

In addition to testing individual systems, we have begun integrated
contingency testing of our Mission Critical and many other systems in a separate
computer environment where dates are set forward in order to identify and
correct problems that might not otherwise become evident until the actual end of
the century.

We do not significantly rely on "embedded technology" in our critical
processes. Embedded technology, which means microprocessor-controlled devices as
opposed to multi-purpose computers, does control some building security and
operations, such as power management, ventilation, and building access. All
building facilities are presently being evaluated, and we expect all systems
using embedded technology to be confirmed as year 2000 ready by June 1999.

We rely on vendors and customers, and we are addressing year 2000 issues
with both groups. We have identified over 300 vendors and have made inquiries
about their year 2000 readiness plans and status. Approximately 35% of these
vendors are rated as critical. We have completed risk assessments on the
critical and non-critical vendors, and we are undertaking appropriate measures
to minimize risk as much as possible for those vendors that we have assigned a
risk rating of medium or high. Among the critical vendors, presently 72% are
rated as low risk, 19% as medium risk, and 9% as high risk.

We plan to have the medium and high risk vendor situations resolved in June
1999. We have, however, no viable alternatives for some suppliers, such as power
distribution and local telephone companies. We are still evaluating these
companies, and we will use the results as information for system-wide
contingency planning. As with all financial institutions, we place a high degree
of reliance on the systems of other institutions, including governmental
agencies, to settle transactions. We will test principal settlement methods
associated with major payment systems as part of their associated system
projects.

We also rely on our customers to make necessary preparations for the year
2000 so that their business operations will not be interrupted, thus threatening
their ability to honor their financial commitments. We have identified over
2,500 borrowers, capital market counterparties, funding sources, and large
depositors that constitute our customers as having financial volumes
sufficiently large to warrant our inquiry and assessment of their year 2000
preparation. The financial volumes included loans and unused commitments,
collected deposit balances, automated clearing house transactions, foreign
exchange, and derivatives. We have completed inquiries and initial written
assessments for 97% of the identified financial volumes.

Our borrowers, the population of customers with loans and unused commitments
outstanding, pose the highest level of concern. As of December 31, 1998, our
assessment of these borrowers resulted in the following assignments of risk: 79%
low risk, 18% medium risk and 3% high risk. We have established individual risk
mitigation plans for substantially all of the customers rated as high risk. The
risk mitigation plans evaluate whether year 2000 issues will materially affect
the customer's cash flow, asset values, and collateral pledged to us. The risk
mitigation plans use the normal credit process that we employ to manage credit
risk and require the concurrence of a credit administrator.

S-66
<PAGE>

We will make ongoing assessments of customers at all levels of risk. Those
with low risk will be reassessed semi-annually, while customers with medium and
high risk will be reassessed quarterly.

RISKS

The principal risks associated with the year 2000 problem can be grouped
into three categories:

- we do not successfully ready our operations for the next century,

- disruption of our operations due to operational failures of third parties,
and

- business interruption among fund providers and obligors such that expected
funding and repayment does not take place.

The only risk largely under our control is preparing our internal operations
for the year 2000. We, like other financial institutions, are heavily dependent
on our computer systems. The complexity of these systems and their
interdependence make it impractical to convert to alternative systems without
interruptions if necessary modifications are not completed on schedule.
Management believes we will be able to make the necessary modifications on
schedule.

Failure of third parties may jeopardize our operations, but the seriousness
of this risk depends on the nature and duration of the failures. The most
serious impact on our operations from vendors would result if basic services
such as telecommunications, electric power, and services provided by other
financial institutions and governmental agencies were disrupted. Some public
disclosure about readiness preparation among basic infrastructure and other
suppliers is now available. We are unable, however, to estimate the likelihood
of significant disruptions among our basic infrastructure suppliers. In view of
the unknown probability of occurrence and impact on operations, we consider the
loss of basic infrastructure services to be the most reasonably likely worst
case year 2000 scenario.

Operational failures among our customers could affect their ability to
continue to provide funding or meet obligations when due. The information we
develop in the customer assessments described earlier allows us to identify
those customers that exhibit a risk of not making adequate preparations for the
century change. We are taking appropriate actions to manage these risks.

PROGRAM ASSESSMENT

The Year 2000 Program Office reports on progress monthly to our Executive
Management Committee and quarterly to the Audit and Examination Committee of our
Board of Directors. Our Internal Audit Division and the National Bank Examiners
regularly assess our year 2000 preparations and report quarterly to the Audit
and Examination Committee.

CONTINGENCY PLANS

We are developing year 2000 remediation contingency plans and business
resumption contingency plans specific to the year 2000. Remediation contingency
plans address the actions we would take if the current approach to remediating a
system is falling behind schedule or otherwise appears in jeopardy of failing to
deliver a year 2000-ready system when needed. Business resumption contingency
plans address the actions that we would take if critical business functions
cannot be carried out in the normal manner upon entering the next century due to
system or supplier failure.

Our business resumption contingency planning is following a four-phase
process:

- Organizational Planning Guidelines,

- Business Impact Analysis,

- Plan Development and

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- Validation of Plans.

During the first two phases, which have been completed, we assigned
responsibilities, specified scenarios and determined which scenarios were
significant for each critical business unit. The second two phases call for the
development of plans to meet the significant scenarios and testing the
effectiveness of the plans.

We are developing plans for system-wide or regional failures and for
individual critical operating units where necessary. We expect to complete
development of plans for the operating units and their validation in June 1999.
We expect to complete development of plans to address system-wide or regional
failures, and their validation, in September 1999.

To determine where plans are necessary for individual operating units, we
identified the following areas of concern, assigned to each a level of potential
risk and a probability of occurrence. The areas of concern are:

- telecommunications or data network outage,

- enterprise information systems failure,

- operational disruptions,

- vendor or service provider failure,

- staff unavailability,

- utility or facility failure, and

- personal computer or local area network failure.

We rated the level of potential risk as high, moderate or low, and we rated
the probability of occurrence as high, moderate or low. Critical operating units
with a low or moderate level of potential risk and a low probability of
occurrence do not require a contingency plan for the area of concern. For any
other combination, the development of a contingency plan is required.

OTHER RELATED DISCLOSURES

HighMark Capital Management, Inc. is a registered investment adviser and
UBOC Investment Services, Inc. is a broker-dealer. Each of these subsidiaries
makes publicly available separate year 2000 reports. You can find additional
year 2000 information in those reports.

EURO CONVERSION

On January 1, 1999, 11 European countries who joined the Economic and
Monetary Union transitioned into a single currency called the "Euro", and a
single central bank -- the European Central Bank. On that date, the exchange
rates of the national currencies of the 11 countries were fixed and all
financial transactions will be settled in Euros.

We have completed our analysis of the bank-wide impact and have implemented
a project plan that addresses the Euro conversion. We are now fully operational
to settle transactions in the Euro.

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<PAGE>
BUSINESS

We are a California-based bank holding company. Our principal subsidiary is
Union Bank of California, N.A. Union Bank of California is:

- the third largest commercial bank in California, based on both total
assets and total deposits in California,

- one of the 30 largest banks in the United States, and

- one of the oldest banks on the West Coast.

At September 30, 1998, we had:

- 244 full-service branches in California,

- 6 full-service branches in Oregon and Washington,

- 2 facilities in Texas and New York, and

- 18 offices abroad.

Our bank was formed through the combination of Union Bank and BanCal
Tri-State Corporation in 1996. We are presently approximately 82% owned by The
Bank of Tokyo-Mitsubishi.

We provide a wide range of financial products and services to retail
customers, small businesses, middle-market companies and large corporations.

Most of our customers are located in California, the nation's most populous
state with over 32 million residents.

As of September 30, 1998, we had total assets of $31.4 billion, total
deposits of $23.7 billion and total shareholders' equity of $3.0 billion. We had
net income for the nine months ended September 30, 1998 of $352.4 million, and
net income per diluted common share of $2.01.

BANKING SERVICES

Our operations are divided into four primary segments:

- Community Banking Group,

- Commercial Financial Services Group,

- Trust and Private Financial Services Group, and

- International Banking Group.

As used in the tables on the following pages, "performance center earnings"
represent the allocation of net interest income, noninterest income and
noninterest expense between the business segments for products and services
originated in one segment but managed by another. "Total loans" and "total
deposits" represent loans and deposits for each business segment before
allocation between the segments of loans and deposits originated in one segment
but managed by another. "Net interest income" and "income before income taxes"
are presented on a taxable-equivalent basis.

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<PAGE>
COMMUNITY BANKING GROUP

The following table presents the historical results of operations for the
Community Banking Group:

<TABLE>
<CAPTION>
COMMUNITY BANKING GROUP
----------------------------------------------
AS OF AND FOR THE AS OF AND FOR THE
YEARS ENDED DECEMBER PERIODS ENDED
31, SEPTEMBER 30,
---------------------- ----------------------
1996 1997 1997 1998
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
RESULTS OF OPERATIONS:
(IN THOUSANDS)
Revenues
Net interest income...................................... $ 658,144 $ 682,782 $ 511,212 $ 504,709
Noninterest income....................................... 133,559 142,944 105,991 136,101
---------- ---------- ---------- ----------
Total.................................................... 791,703 825,726 617,203 640,810
Noninterest expense...................................... 577,655 568,031 419,050 439,927
Credit expense (income).................................. 35,644 57,870 40,975 (3,059)
Performance center earnings.............................. 7,688 10,040 6,558 6,403
Income before income taxes............................... 186,092 209,865 163,736 210,345

BALANCE SHEET DATA (PERIOD AVERAGE):
(IN MILLIONS)

Total loans before performance centers................... $ 9,877 $ 9,672 $ 9,691 $ 9,389
Total assets............................................. 10,991 10,626 10,632 10,329
Total deposits before performance centers................ 11,131 11,757 11,646 12,322

OTHER DATA:
Return on average assets............................... 1.02% 1.17% 1.23% 1.63%
Efficiency ratio....................................... 73.00% 68.80% 67.90% 68.70%
</TABLE>

The Community Banking Group provides its customers with a full line of
checking and savings, investment, loan and fee-based banking products. For the
nine months ended September 30, 1998, average assets in this group were $10.3
billion, and average deposits were $12.3 billion.

The group focuses on four major markets:

- consumers

- businesses with sales under $3 million

- businesses with sales between $3 million and $20 million

- middle-market companies, including agricultural firms, in central
California and in selected parts of Oregon and Washington

Community Banking serves over one million consumer households and businesses
through its 244 branches in California, six branches in Oregon and Washington
and its network of over 380 proprietary ATMs. Customers may also access our
services 24 hours a day by telephone or personal computer. In addition,
Community Banking offers automated teller and point-of-sale debit services
through our founding membership in the Star System, the largest shared ATM
network in the Western United States.

The group is organized by service delivery method, by markets and by
geography. The primary sub-units of the group are:

- community banking branches, which serve consumers, businesses and affluent
individuals

- business banking centers, which serve businesses with sales between $3
million and $20 million

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<PAGE>

- in-store branches, which also serve consumers and businesses

- middle market and agricultural lending offices

- the Consumer Asset Management division, which is responsible for indirect
auto finance, auto leasing, and residential real estate lending

Through alliances with other financial institutions, the group offers
additional products and services, such as credit cards, leasing and financing
based on accounts receivable, inventory or other short-term assets.

Community Banking competes with larger banks by providing service quality
superior to that of its major competitors. We are recognized as among the
highest rated banks in California for customer service quality and satisfaction.

The group's primary means of competing with community banks include its
large and convenient branch network and its reputation for innovative use of
technology to deliver banking services. We have the fifth largest branch network
among depository institutions in California. We also offer convenient banking
hours to consumers through our drive-through banking locations and selected
branches that are open seven days a week.

Community Banking continues to enhance its customer service through the
innovative use of technology. We were among the first banks to team with Intuit
and Microsoft in the launches of their personal financial management software
products, Quicken-Registered Trademark- and Money-Registered Trademark- for
on-line banking. In 1996, we joined America Online's Banking Center as a charter
member. We also worked with Sony to develop the first interactive video banking
application of its kind on the West Coast. In December 1998, we jointly
announced with IBM the first of its kind comprehensive on-line banking system
using Lotus Notes-Registered Trademark- and Domino-Registered Trademark-.

These services and enhancements have enabled us to increase our share of the
consumer and small business markets. From June 30, 1994 to June 30, 1998,
UnionBanCal Corporation's share of the California deposit market increased from
4.0% to 5.1%, representing an annual growth rate of 6.3%. Similarly, since April
1996, Community Banking has increased the number of households it serves by
approximately 5% annually.

The group's strategies include continuing to build upon the more than one
million households and businesses it serves and broadening the range of
financial products and services it provides to existing customers. The group
uses direct mail marketing methods targeted at specific consumers to supplement
its traditional mass media advertising. We are also introducing a new
computer-driven sales system designed to foster cross-selling of our products.
The new system uses improved software to prompt sales staff to offer customers
additional products and services, based on a customer profile. We have installed
the new system in 40 of our branches, and we anticipate full implementation
within 18 months.

The group will continue to use varied pricing strategies to encourage
customers to use lower-cost methods of delivery to receive our products and
services. Community Banking is emphasizing further development of existing
lower-cost product and service delivery methods, such as the Internet, video
kiosks and loans-by-phone, and is expanding its Direct Banking Center, which
offers products, services and technical support for home banking via the
telephone and computer.

Community Banking competes with a number of commercial banks, savings
associations and credit unions, as well as more specialized financial services
providers, such as investment brokerage companies, consumer finance companies,
and residential real estate lenders. The group's primary competitors are other
major depository institutions such as Bank of America, California Federal,
Washington Mutual and Wells Fargo, as well as smaller community banks in the
markets in which we operate.

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<PAGE>
COMMERCIAL FINANCIAL SERVICES GROUP

The following table presents the historical results of operations for the
Commercial Financial Services Group:

<TABLE>
<CAPTION>
COMMERCIAL FINANCIAL SERVICES GROUP
----------------------------------------------
AS OF AND FOR THE AS OF AND FOR THE
YEARS ENDED DECEMBER PERIODS ENDED
31, SEPTEMBER 30,
---------------------- ----------------------
1996 1997 1997 1998
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
RESULTS OF OPERATIONS:
(IN THOUSANDS)
Revenues
Net interest income...................................... $ 401,912 $ 440,804 $ 321,600 $ 360,625
Noninterest income....................................... 78,238 100,316 75,450 82,638
---------- ---------- ---------- ----------
Total.................................................... 480,150 541,120 397,050 443,263
Noninterest expense...................................... 201,870 231,906 166,305 188,328
Credit expense (income).................................. 14,362 18,872 15,065 15,963
Performance center earnings.............................. 4,141 3,926 2,968 2,037
Income before income taxes............................... 268,059 294,268 218,648 241,009

BALANCE SHEET DATA (PERIOD AVERAGE):
(IN MILLIONS)

Total loans before performance centers................... $ 8,286 $ 9,329 $ 9,178 $ 10,783
Total assets............................................. 9,287 10,513 10,344 12,005
Total deposits before performance centers................ 3,959 4,875 4,684 5,844

OTHER DATA:..............................................
Return on average assets............................... 1.72% 1.65% 1.69% 1.63%
Efficiency ratio....................................... 42.00% 42.90% 41.90% 42.50%
</TABLE>

The Commercial Financial Services Group offers a variety of commercial
financial services, including:

- commercial and project loans

- real estate financing

- commercial financing based on accounts receivable, inventory, or other
short term assets

- trade finance, which is the short-term extension of credit to support
export/import transactions, including letters of credit

- lease financing

- customized cash management services

- selected capital markets products.

The group's customers provide a significant source of opportunities for us
to sell products and services of other units of the bank, including treasury,
trust, and retail banking services. For the nine months ended September 30,
1998, average assets in this group were $12.0 billion, and average deposits were
$5.8 billion.

Commercial Financial Services is divided into the following business units,
which serve specific markets and industries:

- The Commercial Banking Group, which serves California middle-market
companies and larger companies most often headquartered in the Western
United States

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<PAGE>

- The Real Estate Industries Group, which serves real estate developers and
real estate investment trusts;

- The Specialized Lending Group, which serves companies operating in various
industries, including oil and gas, utilities, media, communications,
healthcare, finance and retailing; and

- The Institutional and Deposit Markets Group, which serves title and escrow
companies, financial institutions, retailers, bankruptcy trustees and
other customers with large pools of deposits.

The Commercial Customer Service Unit supports these business units by
providing centralized customer service support.

The group competes with other banks primarily on the basis of its reputation
as a "business bank," the quality of its relationship managers, and the delivery
of superior customer service. We are recognized in California as having a
superior "business banking" reputation relative to other large banks. We are
also rated among the highest for our cash management services and systems.
Commercial Financial Services relationship managers are among the most
experienced in the industries that we target, and are trained to be consultative
advisers to our customers.

The group's main strategy is to target industries and companies for which
the group can reasonably expect to be one of a customer's primary banks.
Consistent with its strategy, the group attempts to serve a large part of its
targeted customers' credit and depository needs.

One result of this strategy is increased loan syndication activity. The
group has successfully increased noninterest revenue by expanding its loan
syndication activities, and it plans to continue to emphasize its operations in
this area. Loan syndication revenues increased by $6.2 million to $12.6 million
through the first nine months of 1998 compared to $6.4 million in 1996. This
increase is largely a result of our acting more frequently as agent and/or
underwriter in syndicated loans to middle-market, real estate, and Specialized
Lending Group customers.

We believe that an additional source of increased noninterest income will
come from our expanded participation in capital market transactions. As of
September 30, 1998, UnionBanCal Corporation had approximately $58 million
committed to a private capital investment program, with plans to expand our
investments in 1999. Commercial Financial Services generally makes investments
in funds and companies with proven operating histories and in industries in
which the group specializes. We will seek to earn more fee income from loan
securitizations, particularly from commercial mortgages.

As the group increasingly allocates its resources to those industries and
companies that fit its strategy, it will simultaneously de-emphasize efforts to
build banking relationships with companies outside of its target markets. We
expect to move away from junior syndicate roles in the market for large
corporate credits and toward the purchase of selected credits from the secondary
market for bank loans.

In addition, Commercial Financial Services intends to use improved
technology to enhance the efficiency of its operations and the productivity of
its bankers and support staff. Among its planned system improvements are
enhancements to loan automation technology, improved software to measure
customer profitability, and enhanced information and contact management systems
for relationship officers.

The group competes with a variety of other financial services companies.
Competitors include other major California banks, as well as regional, national
and international banks. In addition, we compete with investment banks,
commercial finance companies, leasing companies and insurance companies.

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<PAGE>
TRUST & PRIVATE FINANCIAL SERVICES GROUP

The following table presents the historical results of operations for the
Trust & Private Financial Services Group:

<TABLE>
<CAPTION>
TRUST & PRIVATE FINANCIAL SERVICES GROUP
----------------------------------------------
AS OF AND FOR THE AS OF AND FOR THE
YEARS ENDED DECEMBER PERIODS ENDED
31, SEPTEMBER 30,
---------------------- ----------------------
1996 1997 1997 1998
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
RESULTS OF OPERATIONS:
(IN THOUSANDS)
Revenues
Net interest income...................................... $ 11,539 $ 20,995 $ 14,332 $ 16,770
Noninterest income....................................... 110,182 128,100 91,951 106,843
---------- ---------- ---------- ----------
Total.................................................... 121,721 149,095 106,283 123,613
Noninterest expense...................................... 108,495 123,102 89,581 96,897
Credit expense (income).................................. 927 155 102 249
Performance center earnings.............................. (674) (1,472) (929) 105
Income before income taxes............................... 11,625 24,366 15,671 26,572

BALANCE SHEET DATA (PERIOD AVERAGE):
(IN MILLIONS)

Total loans before performance centers................... $ 62 $ 229 $ 236 $ 245
Total assets............................................. 94 303 322 297
Total deposits before performance centers................ 425 708 625 679

OTHER DATA:..............................................
Return on average assets............................... 7.36% 4.74% 3.90% 7.34%
Efficiency ratio....................................... 89.10% 82.60% 84.30% 78.40%
</TABLE>

The Trust & Private Financial Services Group offers investment management
and administration services for a broad range of individuals and institutions.
The group:

- services individual client needs through its trust and private banking,
investment management and brokerage products and services,

- services institutional client needs through traditional employee benefit
and 401(k) programs, global and domestic securities custody programs,
securities lending programs and corporate trust products, and

- provides investment management services for both individual and
institutional clients through HighMark Capital Management, Inc. and its
family of proprietary HighMark mutual funds.

As of September 30, 1998, the group had over $90 billion in assets under
administration.

The group is organized into five business divisions:

- The Private Bank division focuses primarily on delivering integrated and
customized financial services to high net worth individuals with
sophisticated financial needs. Specific products and services include
trust and estate services, investment account management services,
offshore trust services and customized deposit and credit products. The
Private Bank's strategy is to expand its business by increasing its
geographic market coverage and the breadth of its products and services.
To support that strategy, The Private Bank expanded from nine offices to
14 during 1998. In addition, it has shifted sales staff training efforts
toward increased cross-selling of all of the bank's available products and
services.

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<PAGE>

- HighMark Capital Management, Inc., a registered investment advisor,
manages our proprietary HighMark family of mutual funds. It also provides
investment management services to institutions, pension plans and
individuals, including to clients of other divisions. HighMark Capital
Management's strategy is to expand distribution of its mutual funds by
targeting its marketing efforts at registered investment advisors and
regional broker/dealers. In addition, HighMark is working with The Bank of
Tokyo-Mitsubishi and other third parties to offer HighMark mutual funds
offshore to non-U.S. residents and to serve as a sub-advisor for funds
managed by Tokyo-Mitsubishi Asset Management, Limited in Japan.

- The Business Trust division provides businesses, government agencies,
unions and non-profit organizations with trustee services, investment
management and 401(k) valuation and record keeping services. Business
Trust's strategy is to expand its third-party distribution network to
include insurance companies, investment managers, brokers and mutual
funds.

- The Investment Services division consists of UBOC Insurance Services and
UBOC Investment Services, Inc., a registered broker/dealer offering a full
line of investment products to individuals and institutional clients. The
division's primary strategy is to further penetrate UnionBanCal
Corporation's existing client base.

- The Securities Services division is engaged in domestic and global
securities custody, safekeeping, mutual fund accounting, securities
lending and corporate trust services. Its client base includes financial
institutions, businesses, government agencies, unions, investment managers
and non-profit organizations. Securities Services is the only West Coast
based provider of a full range of institutional financial services.

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<PAGE>
INTERNATIONAL BANKING GROUP

The following table presents the historical results of operations for the
International Banking Group:

<TABLE>
<CAPTION>
INTERNATIONAL BANKING GROUP
----------------------------------------------
AS OF AND FOR THE AS OF AND FOR THE
YEARS ENDED DECEMBER PERIODS ENDED
31, SEPTEMBER 30,
---------------------- ----------------------
1996 1997 1997 1998
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
RESULTS OF OPERATIONS:
(IN THOUSANDS)
Revenues
Net interest income...................................... $ 48,175 $ 49,405 $ 35,990 $ 42,487
Noninterest income....................................... 62,373 62,238 46,887 49,758
---------- ---------- ---------- ----------
Total.................................................... 110,548 111,643 82,877 92,245
Noninterest expense...................................... 72,719 64,874 48,942 48,765
Credit expense (income).................................. (4,361) 234 216 2,915
Performance center earnings.............................. (6,917) (3,759) (3,171) (2,394)
Income before income taxes............................... 35,273 42,776 30,548 38,171

BALANCE SHEET DATA (PERIOD AVERAGE):
(IN MILLIONS)

Total loans before performance centers................... $ 1,245 $ 1,483 $ 1,423 $ 1,385
Total assets............................................. 2,210 2,631 2,563 2,123
Total deposits before performance centers................ 1,080 959 980 864

OTHER DATA:..............................................
Return on average assets............................... 0.95% 0.96% 0.96% 1.45%
Efficiency ratio....................................... 65.80% 58.10% 59.10% 52.90%
</TABLE>

The International Banking Group primarily provides correspondent banking and
trade finance-related products and services to financial institutions worldwide,
including in Brazil, Hong Kong, Japan, Korea and Taiwan. This includes the
provision of products and services that facilitate trade finance transactions,
including payments, collection and the extension of short term credit. It also
serves selected foreign firms and U.S. corporate clients in selected countries
worldwide, particularly in Asia. In the United States, International Banking
serves subsidiaries and affiliates of non-Japanese Asian companies and U.S.
branches and agencies of foreign banks. It also provides international services
to domestic corporate clients along the West Coast. For the nine months ended
September 30, 1998, average assets in this group were $2.1 billion and average
deposits were $864 million.

This group has a long and stable history of providing correspondent and
trade-related services to international financial institutions. We believe that
we have achieved a leading market position and strong customer loyalty in the
Asia/Pacific correspondent banking market because we provide high quality,
customized products and services at competitive prices. The group maintains
branches in Tokyo, Taipei, Seoul, Manila and Hong Kong, representative offices
in other parts of Asia and Latin America, and an international banking
subsidiary in New York.

One of International Banking's primary services is international trade
finance. Trade finance is typically short term, which means it generally has a
lower credit risk. Despite this relatively lower credit risk compared to some
other forms of commercial credit, we have reduced the amount of credit we have
extended to our customers and the average maturity of this portfolio in response
to recent instability in global markets.

UnionBanCal Corporation has substantially reduced its cross-border
outstandings. We reduced outstandings to Japan, Korea, Malaysia, Thailand,
Vietnam, Singapore, Indonesia, the Philippines, China

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<PAGE>

and Hong Kong by $1 billion to $1.6 billion at September 30, 1998 compared to
$2.6 billion at December 31, 1997. A substantial portion of the outstandings are
related to the International Banking Group. In addition, our outstandings to
Latin America were only $295 million at September 30, 1998, $133 million of
which was attributable to Brazil. Management continues to closely monitor the
amount of credit we have extended to our customers in international markets.

International Banking's strategy is to improve its global operations by
reducing costs and improving productivity. It competes with both U.S. and
foreign banks. Approximately 25 U.S. banks compete with the group to provide
correspondent banking and trade-related services to Asian banks. The group's
primary competitors include First Union, Bank of New York, Chase Manhattan,
Citibank, Bank of America, and Bank of Hawaii.

OTHER BUSINESS ACTIVITIES

We also conduct business activities with customers through other
organizational units of the bank.

The Pacific Rim Corporate Group specializes in providing a range of credit,
deposit, and investment management products and services to companies in the
United States that are affiliated with companies headquartered outside the
United States, mostly in Japan. For the nine months ended September 1998,
average assets were $811 million.

The Global Markets Group conducts business activities primarily to support
the previously described business groups and their customers. This group offers
a broad range of risk management products, such as foreign exchange, interest
rate swaps, caps and floors. Additionally, it originates debt instruments for
bank eligible issuers, places debt securities, as well as the bank's own
liabilities, with institutional investors and trades debt instruments in the
secondary market. This group also manages our market-related risks as part of
its responsibilities for asset/liability management. It is also responsible for
maintaining the bank's investment securities portfolio.

OPERATING STRATEGY

Our operating strategy is to:

- CAPITALIZE ON OUR STRONG POSITION IN CORE CALIFORNIA MARKET. We believe
that one of our primary strategic strengths is our established position in
the attractive California bank market. Based on both total assets and
total deposits in California, we are the third largest commercial bank in
California, and we are among the oldest banks on the West Coast. We serve
approximately one million households and small businesses, with 244
full-service branches in California.

- STRENGTHEN OUR CONSUMER BANKING FRANCHISE. We are seeking to increase the
number of consumer households we serve, and we are simultaneously
broadening the range of financial products and services we provide to
existing customers. We are also adding to the number of households we
serve by offering product and service delivery alternatives, including
online banking, video kiosks and telephone-based services. We are also
obtaining new customers with the successful use of targeted direct mail
promotions. In an effort to offer our customers more loan and deposit
products, we have installed a new computer-driven sales system designed to
foster cross-selling. The new system has been installed in 40 of our
branches, and we anticipate full implementation within 18 months. We also
plan to expand the franchise through new branch openings and the possible
acquisition of community banks in targeted markets.

- FOCUS OUR COMMERCIAL BANKING EFFORTS ON SPECIFIC INDUSTRIES AND
COMPANIES. We are targeting our commercial banking activities on those
industries and companies that we believe will make us one of their
principal banks. Our emphasis is on relationship management and meeting a
large part of our targeted customers' credit and depository needs. Our
commercial banking activities include industry specialties, such as
communications, media and energy. We have been successful in

S-77
<PAGE>

increasing our role as agent and/or underwriter in syndicated loans to
these specialized industry customers. We intend to broaden our syndication
efforts to include other markets we serve, such as real estate finance and
middle-market companies. We also provide depository and cash management
services to niche markets, including title and escrow companies, financial
institutions, retailers and bankruptcy trustees.

- DIVERSIFY OUR REVENUE SOURCES AND EXPAND OUR FEE-BASED BUSINESS. We are
seeking to diversify our revenue sources by expanding our fee-based
businesses, with a particular emphasis on our trust and asset management
businesses. We are working with The Bank of Tokyo-Mitsubishi and other
third parties to offer our proprietary HighMark mutual funds offshore to
non-U.S. residents and to serve as a sub-advisor for funds managed by
Tokyo-Mitsubishi Asset Management, Limited in Japan. We intend to expand
the activities of our brokerage and insurance businesses by further
penetrating our existing client base. We expanded our private banking
business in 1998 to include 14 offices. We also intend to expand our
distribution of 401(k) valuation and record-keeping services to insurance
companies, investment managers, brokers and mutual funds. Our noninterest
income, net of gain on the sale of our credit card portfolio, has
increased from 26% of total revenue in 1995 to 28% of total revenue for
the nine-month period ended September 30, 1998. For the nine-month period
ended September 30, 1997 to the nine-month period ended September 30,
1998, noninterest income, net of gain on the sale of our credit card
portfolio, increased from $342.6 million to $382.9 million.

- EMPHASIZE OUR QUALITY CUSTOMER SERVICE. We seek to continue to provide
highly responsive customer service to create and maintain long-term
relationships with clients who are often underserved by larger banks. We
intend to continue to capitalize on the high quality of our customer
service, taking advantage of any changes in service levels caused by
recent increases in bank merger activity in the California market.

- MAINTAIN OUR HIGH LENDING STANDARDS AND OUR STRONG ASSET QUALITY
PROFILE. We strive to maintain strong asset quality through our
underwriting standards, credit policies and ongoing credit reviews of our
existing loan portfolio. These criteria, along with the recent strength of
the California economy, have resulted in our current high quality
portfolio. At September 30, 1998, our ratio of non-performing assets to
total assets was 0.26%, or the seventh lowest of the 30 largest commercial
banks in the United States. In addition, as of September 30, 1998, our
ratio of reserves to total loans was 2.02%, or the eighth highest of the
30 largest commercial banks in the United States. At September 30, 1998,
no industry concentration exceeded 10% of our total commercial, financial
and industrial loans. Additionally, at September 30, 1998, we had a
limited number of borrowers with larger loans. We had only 10 borrowers
with total outstanding balances of over $50 million, and only one borrower
with a total outstanding balance of over $75 million.

- IDENTIFY STRATEGIC BUSINESSES AND CONSIDER POTENTIAL ACQUISITIONS OR
DIVESTITURES. We view selective acquisitions, divestitures, and internal
growth as the primary means to increase and enhance our core businesses.
We will consider acquisitions of banks and other financial service
businesses that will increase our presence in existing markets or allow us
to expand into contiguous markets. We will also consider acquisitions in
other complementary financial service businesses in which we believe there
exists superior growth potential. In addition, we will consider exiting
businesses that do not meet our core business criteria. Our strategic
business evaluation process focuses on historical financial performance,
the competitive environment, future growth potential and regulatory
considerations.

- IMPROVE OUR OPERATING EFFICIENCY. We plan to improve our operating
efficiency by undertaking a comprehensive review of all our lines of
business and our product, customer support and administrative departments.
To assist us in this effort, we expect to employ a consultant with
demonstrated success in realizing long-term efficiency improvements at
other major financial institutions. Our aim

S-78
<PAGE>

is to begin an efficiency improvement project during the second quarter of
1999 and to have it fully implemented by late 2000.

- ACHIEVE COMPETITIVE FINANCIAL PERFORMANCE TARGETS. In connection with our
strategic repositioning, we have developed long-term financial performance
goals. These goals will serve as a tool for measuring the long-term
success of our operating strategies, based on normal business operations,
without including nonrecurring events that may occur from time to time.
Our long-term financial performance goals include:

<TABLE>
<CAPTION>
PERFORMANCE RATIO GOAL
- ------------------------------------------------------------- ---------------
<S> <C>
- - Return on average common equity 15% to 17%
- - Earnings per share growth 10% to 12%
- - Efficiency ratio 54% to 56%
- - Tangible common equity to assets 7.5% to 8.5%
</TABLE>

Although we believe these goals are realizable given our proposed operating
strategies and our current asset quality, we cannot assure you that we will
attain these long-term financial performance goals at any particular time.
See "Risk Factors--Adverse Factors Could Affect Our Long-Term Financial
Performance Goals" on page .

- ALIGN OUR SENIOR MANAGEMENT COMPENSATION WITH SHAREHOLDERS' INTERESTS. Our
senior management compensation philosophy is to pay competitively and to
pay for performance. In connection with our strategic repositioning, we
have taken steps to align senior management compensation more directly
with shareholders' interests.

To this end, we have made several changes to our senior management
compensation programs. We have linked our Senior Management Bonus Plan to
our return on average common equity performance target and net income. In
addition, we have increased the percentage of stock-based compensation,
including options, restricted stock, and performance shares, that makes up
our senior management's total compensation, with increased emphasis on
stock options. We believe that the level of compensation, as well as the
percentage of stock to total compensation paid to senior management, are
competitive with our peers in the banking industry.

ACCOUNTING TREATMENT

For financial reporting purposes, we will treat Finance Trust I as a
subsidiary of UnionBanCal Corporation. Accordingly, we will include the
accounts of Finance Trust I in our consolidated financial statements. We
will include the capital securities in our consolidated balance sheets, and
will include appropriate disclosures about the capital securities, the
guarantee and the junior subordinated debentures in the notes to our
consolidated financial statements. For financial reporting purposes, we
will record distributions on the capital securities in our consolidated
statements of income.

S-79
<PAGE>
DESCRIPTION OF THE CAPITAL SECURITIES

THE FOLLOWING DESCRIPTION OF THE CAPITAL SECURITIES IS NOT COMPLETE. YOU
SHOULD ALSO READ THE DESCRIPTION OF THE GENERAL TERMS OF THE CAPITAL SECURITIES
IN THE ACCOMPANYING PROSPECTUS UNDER THE CAPTION "DESCRIPTION OF THE TRUST
PREFERRED SECURITIES," THE TRUST DECLARATION, THE DELAWARE BUSINESS TRUST ACT
AND THE TRUST INDENTURE ACT. WE HAVE FILED THE TRUST DECLARATION AS AN EXHIBIT
TO THE REGISTRATION STATEMENT OF WHICH THE ACCOMPANYING PROSPECTUS FORMS A PART.

Finance Trust I will issue the capital securities under the terms of the
trust declaration. We expect that at the time the Registration Statement becomes
effective, the trust declaration will be qualified as an indenture under the
Trust Indenture Act, and that The First National Bank of Chicago, as the
property trustee, will act as the indenture trustee for purposes of complying
with the provisions of the Trust Indenture Act. The terms of the capital
securities will include those stated in the trust declaration and the Delaware
Business Trust Act and those made part of the trust declaration by the Trust
Indenture Act.

GENERAL

The capital securities will be limited to $ - aggregate liquidation amount
outstanding. The capital securities will rank equal to, and payments will be
made on the capital securities on a proportional basis with, the common
securities, except as described under "--Subordination of Common Securities" on
page S-84. The trust declaration does not permit. Finance Trust I to issue any
securities other than the common securities and the capital securities or to
incur any indebtedness.

We will register the junior subordinated debentures in the name of Finance
Trust I. The property trustee will hold the junior subordinated debentures in
trust for the benefit of the holders of the capital securities and the common
securities.

DISTRIBUTIONS

Distributions on the capital securities will be fixed at an annual rate of
% of the stated liquidation amount of $25 per capital security. The
liquidation amount is the amount that you are entitled to receive if UnionBanCal
Finance Trust I is terminated and its assets are distributed to the holders of
its securities. You are entitled to receive the amount from the assets of
Finance Trust I available for distribution, after it has paid liabilities owed
to its creditors. Accordingly, you may not receive the full amount if Finance
Trust I does not have enough funds. Distributions to which holders of the
capital securities are entitled and that are more than one quarter past due will
accumulate additional distributions at an annual rate of % of the unpaid
distributions, compounded quarterly. The term "distribution" includes any
additional distributions payable unless otherwise stated. The amount of
distributions payable for any period will be computed on the basis of a 360-day
year of twelve 30-day months. For any period other than a full quarter, the
amount of distribution payable will be computed on the basis of the actual
number of days elapsed per 30-day month.

Distributions on the capital securities:

- will be cumulative,

- will accumulate from , 1999, the date of initial issuance of the
capital securities, and

- will be payable quarterly in arrears on , , and of
each year, commencing , 1999.

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<PAGE>

Funds available for distributions will be limited to payments received from
UnionBanCal Corporation on the junior subordinated debentures.

PAYMENT OF DISTRIBUTIONS

Finance Trust I will pay distributions on the capital securities to holders
as they appear on the books and records of Finance Trust I on the relevant
record dates. As long as the capital securities remain in book-entry only form,
the record dates will be one business day before the relevant payment dates.

If the capital securities do not remain in book-entry only form, the record
dates will be 15 calendar days, whether or not a business day, before the
relevant payment dates.

Finance Trust I will pay distributions through the property trustee. The
property trustee will hold amounts received from the junior subordinated
debentures in the property account for the benefit of the holders of the capital
securities and the common securities.

If distributions are payable on a day that is not a business day, then
payment of that distribution will be made on the next day that is a business
day, and without any interest or other payment for any delay, If, however, that
business day is in the next calendar year, payment will be made on the
immediately preceding business day, in each case with the same force and effect
as if made on the payment date.

A "business day" shall mean any day other than Saturday, Sunday, any other
day on which banking institutions in the City of New York, New York, are
permitted or required by law to close, or a day on which the corporate trust
office of the property trustee or the indenture trustee is closed for business.

DEFERRAL OF DISTRIBUTIONS

As long as we are not in default on the payment of interest on the junior
subordinated debentures, we have the right to defer payments of interest on the
junior subordinated debentures at any time and from time to time by extending
the interest payment period for a period (an "Extension Period") not exceeding
20 consecutive quarters, but not beyond the maturity of the junior subordinated
debentures.

As a consequence, Finance Trust I will defer payment of the quarterly
distributions on the capital securities. The distributions will continue to
accumulate, with interest, as permitted by applicable law, at an annual rate of
- %, compounded quarterly, during the Extension Period.

If we defer interest payments on the junior subordinated debentures, we
would be restricted from paying dividends on, or making purchases of, our
capital stock and from making payments on our debt securities that rank equal or
junior to the junior subordinated debentures. See "Description of the Junior
Subordinated Debentures--Option to Extend Interest Payment Period" on page for
more information regarding the restrictions.

If Finance Trust I defers distributions, the deferred distributions,
including accumulated additional distributions, will be paid to holders of
record of the capital securities as they appear on the books and records of
Finance Trust I on the record date following the termination of the Extension
Period.

We have no current intention of deferring payments of interest by extending
the interest payment period on the junior subordinated debentures.

REDEMPTION

When we repay or redeem some or all of the junior subordinated debentures,
whether at maturity or upon earlier redemption, the property trustee will apply
the proceeds from the repayment or redemption to redeem the same proportionate
amount of capital securities and common securities. The redemption price per
security will equal the $25 liquidation amount, plus accumulated and unpaid
distributions to the date of redemption.

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<PAGE>

If less than all the junior subordinated debentures are to be repaid or
redeemed, then the aggregate liquidation amount of capital and common securities
to be redeemed will be allocated PRO RATA, or approximately 3% to the common
securities and 97% to the capital securities, except in the case of an event of
default under the indenture. See "--Subordination of Common Securities" on page
S-84.

We will have the right, after receipt of prior approval by the Federal
Reserve, if approval is then required, to redeem the junior subordinated
debentures:

- on or after , 2004, in whole at any time or in part from time
to time or

- prior to , 2004 in whole, but not in part, at any time within
90 days following the occurrence and continuation of a Tax Event, an
Investment Company Event or a Regulatory Capital Event, each as we define
below. A redemption of the junior subordinated debentures will cause a
mandatory redemption of the capital securities and the common securities.
See "Description of the Junior Subordinated Debentures--Optional
Redemption" on page S-93.

"Tax Event" means that the regular trustees, or, if Finance Trust I has been
terminated at the time, an appropriate representative of the holders of the
junior subordinated debentures, have received an opinion of nationally
recognized independent tax counsel experienced in such matters to the effect
that, as a result of:

- any amendment to, clarification of, or change, including any announced
prospective change, in the laws, or any regulations under the laws, of the
United States or any political subdivision or taxing authority affecting
taxation;

- any judicial decision, official administrative pronouncement, ruling,
regulatory procedure, notice or announcement, including any notice or
announcement of intent to adopt such procedures or regulations (an
"Administrative Action"); or

- any amendment to, clarification of, or change in the official position or
the interpretation of such Administrative Action or judicial decision that
differs from the prior generally accepted position,

in each case, by any legislative body, court, governmental authority or
regulatory body, irrespective of the manner in which the amendment,
clarification, change or Administrative Action is made known, which amendment,
clarification, change or Administrative Action is effective or which
pronouncement or decision is announced, in each case, on or after the date of
this prospectus supplement, there is more than an insubstantial risk that:

(1) Finance Trust I is, or will be within 90 days of the date of the opinion
of counsel, subject to United States federal income tax with respect to
income accrued or received on the junior subordinated debentures,

(2) Finance Trust I is, or will be within 90 days of the date of the opinion
of counsel, subject to more than a DE MINIMIS amount of taxes, duties or
other governmental charges, except for withholding taxes or

(3) interest paid in cash by us to Finance Trust I on the junior
subordinated debentures is not, or within 90 days of the date of the
opinion of counsel will not be, deductible, in whole or in part, by us
for United States federal income tax purposes.

Notwithstanding the foregoing, a Tax Event does not include any change in
tax law that requires us to defer taking a deduction for any original issue
discount ("OID") that accrues with respect to the junior subordinated debentures
until the interest payment related to the OID is paid by us in cash if the
change in tax law does not create more than an insubstantial risk that we will
be prevented from taking a deduction for OID accruing on the junior subordinated
debentures at a date that is no later than the date the interest payment related
to the OID is actually paid by us in cash.

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<PAGE>

If an event described in clause (1) or (2) of the definition of "Tax Event"
above has occurred and is continuing and Finance Trust I is the holder of all of
the junior subordinated debentures, UnionBanCal Corporation will pay Additional
Interest, as we define it in "Description of the Junior Subordinated
Debentures--Additional Interest" below on page S-93, if any, on the junior
subordinated debentures.

"Investment Company Event" means that the regular trustees have received an
opinion of nationally recognized independent counsel experienced in such matters
that, as a result of the occurrence of a change, including any announced
prospective change, in law or regulation or a written change, including any
announced prospective change, in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory
authority on or after the date of this prospectus supplement, there is more than
an insubstantial risk that Finance Trust I is or will be considered an
"investment company" that is required to be registered under the Investment
Company Act of 1940.

"Regulatory Capital Event" means that we have received an opinion of
nationally recognized independent counsel experienced in such matters that, as a
result of

(1) any amendment to, clarification of or change, including any announced
prospective change, in applicable laws or regulations or official
interpretations thereof or policies with respect thereto or

(2) any official administrative pronouncement or judicial decision
interpreting or applying such laws or regulations, which amendment,
clarification, change, pronouncement or decision is announced or is
effective after the date of this prospectus supplement, there is more
than an insubstantial risk that the Capital Securities will no longer
constitute Tier 1 capital of UnionBanCal Corporation for purposes of the
capital adequacy guidelines or policies of the Federal Reserve or its
successor as UnionBanCal Corporation's primary federal banking regulator.

REDEMPTION PROCEDURES

Finance Trust I may not redeem fewer than all of the outstanding capital
securities unless it has paid all accumulated and unpaid distributions on all
capital securities for all quarterly distribution periods terminating on or
prior to the date of redemption. Finance Trust I may redeem capital securities
only in an amount equal to the funds it has on hand and legally available to pay
the redemption price.

The property trustee will give you notice of the redemption at least 30 but
not more than 60 days before the date fixed for redemption. If Finance Trust I
gives a notice of redemption, then, by 12:00 noon, New York City time, on the
date of redemption, if the funds are available for payment, the property trustee
will, for capital securities held in book-entry form:

- deposit irrevocably with The Depository Trust Company ("DTC") funds
sufficient to pay the applicable redemption price, and

- give DTC irrevocable instructions and authority to pay the redemption
price to the holders of the capital securities.

With respect to capital securities not held in book-entry form, if funds are
available for payment, the property trustee will:

- irrevocably deposit with the paying agent for the capital securities funds
sufficient to pay the applicable redemption price, and

- give such paying agent irrevocable instructions and authority to pay the
redemption price to the holders of capital securities upon surrender of
their certificates evidencing the capital securities.

Notwithstanding the foregoing, distributions payable on or prior to the date
of redemption for any capital securities called for redemption will be payable
to the holders on the relevant record dates.

S-83
<PAGE>

Once notice of redemption is given and funds are deposited as required, then
all rights of the holders of capital securities called for redemption will
cease, except the right to receive the redemption price, but without interest.
At that time, those capital securities will cease to be outstanding.

If any date fixed for redemption is not a business day, then payment of the
redemption price will be made on the next day that is a business day, without
any interest or other payment for the delay. If the next business day falls in
the next calendar year, the payment will instead be made on the immediately
preceding business day.

If payment of the redemption price for the capital securities called for
redemption is improperly withheld or refused and not paid, either by Finance
Trust I or by UnionBanCal Corporation under the guarantee, then distributions on
those capital securities will continue to accumulate at the then applicable
rate, from the date of redemption to the date of actual payment. In this case,
the actual payment date will be the date fixed for redemption for purposes of
calculating the redemption price.

UnionBanCal Corporation or its affiliates may at any time and from time to
time purchase outstanding capital securities, by tender, in the open market or
by private agreement, and may resell capital securities.

If Finance Trust I is going to redeem less than all the capital securities
and common securities, then the aggregate liquidation amount of capital and
common securities to be redeemed will be allocated approximately 3% to the
common securities and 97% to the capital securities, except if an event of
default has occurred. In such case, holders of capital securities will be paid
first. See "--Subordination of the Common Securities" immediately below for a
more complete discussion. The property trustee will select the particular
capital securities to be redeemed on this PRO RATA basis not more than 60 days
before the date of redemption by any method the property trustee deems fair and
appropriate, or if the capital securities are then held in book-entry form, in
accordance with DTC's customary procedures.

SUBORDINATION OF COMMON SECURITIES

Payment of distributions on, and the redemption price of, the capital
securities and the common securities, will be made on a proportionate basis,
based on the aggregate liquidation amounts of the capital and common securities.
However, if an event of default under the indenture has occurred and is
continuing under the junior subordinated debentures, then no payments may be
made on the common securities unless all unpaid amounts due on the capital
securities have been paid in full or provided for, as appropriate.

In the case of any event of default under the trust declaration resulting
from an event of default under the indenture, the holder of the common
securities will be deemed to have waived any right to act upon the event of
default under the trust declaration until the effects of all events of default
under the trust declaration regarding the capital securities have been cured,
waived or otherwise eliminated. See "Description of the Junior Subordinated
Debentures--Indenture Events of Default" on page S-94.

Until all events of default under the trust declaration regarding the
capital securities have been cured, waived or otherwise eliminated, the property
trustee will act solely on behalf of the holders of the capital securities and
not on behalf of the holder of the common securities, and only the holders of
the capital securities will have the right to direct the property trustee to act
on their behalf.

VOTING RIGHTS

Except as described in this section, under the Delaware Business Trust Act
and the Trust Indenture Act, under "Description of the Trust Preferred
Securities Guarantees--Amendments and Assignment" on page 31 of the accompanying
prospectus and as otherwise required by law and the trust declaration, the
holders of the capital securities will have no voting rights.

S-84
<PAGE>

Holders of a majority in aggregate liquidation amount of the capital
securities have the right:

(1) to direct the time, method and place of conducting any proceeding for
any remedy available to the property trustee, or

(2) upon the property trustee's receipt of a tax opinion to the effect that,
as a result of taking any of the specified actions, Finance Trust I will not
fail to be classified as a grantor trust for United States federal income tax
purposes, to direct the exercise of any trust or power conferred upon the
property trustee under the trust declaration, including the right to direct the
property trustee, as holder of the junior subordinated debentures, to:

- exercise the remedies available under the indenture with respect to the
junior subordinated debentures;

- waive any past event of default under the indenture that is waivable;

- exercise any right to rescind or annul an acceleration of the principal of
all the junior subordinated debentures or

- consent to any amendment, modification or termination of the indenture or
the junior subordinated debentures where such consent shall be required.

If, however, an event of default under the indenture has occurred and is
continuing, holders of 25% of the aggregate liquidation amount of the capital
securities then outstanding may direct the property trustee to declare the
principal of and interest on the junior subordinated debentures immediately due
and payable. In addition, if a consent or action under the indenture requires
the consent or action of holders of more than a majority in principal amount of
the junior subordinated debentures then outstanding (a "super-majority"), only
the holders of at least such super-majority in aggregate liquidation amount of
the capital securities then outstanding may direct the property trustee to give
its consent or take the action.

If the property trustee fails to enforce its rights under the junior
subordinated debentures, you may sue us directly to enforce the property
trustee's rights under the junior subordinated debentures.

Notwithstanding the foregoing, if an event of default under the trust
declaration has occurred and is continuing and the event is attributable to our
failure to pay interest or principal on the junior subordinated debentures when
due, then you may sue us directly for enforcement of payment to you of amounts
owed on the junior subordinated debentures equal to the aggregate liquidation
amount of your capital securities (a "Direct Action").

In a Direct Action initiated by you, our rights, as the holder of the common
securities, to receive payments will be subrogated to your rights under the
trust declaration by an amount equal to any payment made by us, as the issuer of
the junior subordinated debentures, to you in the Direct Action that otherwise
would have been paid to us as the holder of the common securities if the common
securities had not been junior to the capital securities in that event.

The holders of the capital securities will not be able to exercise directly
any other remedy available to the holders of the junior subordinated debentures.

If the consent of the property trustee, as the holder of the junior
subordinated debentures, is required under the indenture for any amendment,
modification or termination of the indenture or the junior subordinated
debentures, the property trustee will:

- request the direction of the holders of the capital and common securities
regarding the amendment, modification or termination and

- vote on the amendment, modification or termination as directed by a
majority or super-majority, as applicable, in liquidation amount of the
capital and common securities voting together as a single class.

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<PAGE>

A waiver of an event of default under the indenture will constitute a waiver
of the corresponding event of default under the trust declaration.

The procedures by which holders of capital securities may exercise their
voting rights are described immediately below under "--Book-Entry Only
Issuance--The Depository Trust Company."

BOOK-ENTRY ONLY ISSUANCE--THE DEPOSITORY TRUST COMPANY

DTC will act as securities depositary for the capital securities. Finance
Trust I will issue one or more fully registered global capital securities
certificates in the name of Cede & Co. (DTC's nominee). These certificates will
represent the total aggregate number of capital securities. Finance Trust I will
deposit these certificates with DTC or a custodian appointed by DTC. Finance
Trust I will not issue certificates to you for the capital securities that you
purchase, unless DTC's services are discontinued.

DTC has provided Finance Trust I and UnionBanCal Corporation with the
following information: DTC is a limited-purpose trust company organized under
the New York Banking Law, a "banking organization" within the meaning of the New
York Banking Law, a member of the Federal Reserve System, a "clearing
corporation" within the meaning of the New York Uniform Commercial Code, and a
"clearing agency" registered under the provisions of Section 17A of the
Securities Exchange Act of 1934. DTC holds securities that its participants
deposit with DTC. DTC also facilitates the settlement among participants of
securities transactions, such as transfers and pledges, in deposited securities
through electronic computerized book-entry changes in participants' accounts,
thereby eliminating the need for physical movement of securities certificates.
Direct participants include securities brokers and dealers, banks, trust
companies, clearing corporations and other organizations ("Direct
Participants").

DTC is owned by a number of its Direct Participants and by the New York
Stock Exchange, Inc., the American Stock Exchange, Inc., and the National
Association of Securities Dealers, Inc. Access to the DTC system is also
available to others, such as securities brokers and dealers, banks and trust
companies, that clear transactions through or maintain a direct or indirect
custodial relationship with a Direct Participant ("Indirect Participants"). The
rules applicable to DTC and its participants are on file with the SEC.

When you purchase capital securities within the DTC system, the purchase
must be made by or through a Direct Participant. The Direct Participant will
receive a credit for the capital securities on DTC's records. You, as the actual
owner of the capital securities, are the "beneficial owner." Your beneficial
ownership interest will be recorded on the Direct and Indirect Participants'
records, but DTC will have no knowledge of your individual ownership. DTC's
records reflect only the identity of the Direct Participants to whose accounts
capital securities are credited.

You will not receive written confirmation from DTC of your purchases. The
Direct or Indirect Participant through whom you purchased the capital securities
should send you written confirmations providing details of your transactions, as
well as periodic statements of your holdings. The participants are responsible
for keeping accurate account of the holdings of their customers like you.

Transfers of ownership interests in the capital securities will be
accomplished by entries made on the books of participants acting on behalf of
beneficial owners.

The laws of some states may require that specified purchasers of securities
take physical delivery of the securities in definitive form. These laws may
impair the ability to transfer beneficial interests in the global certificate
representing the capital securities.

Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants and by Direct
Participants and Indirect Participants to beneficial owners will be governed by
arrangements among them, and any statutory or regulatory requirements that may
be in effect from time to time.

S-86
<PAGE>

Redemption notices will be sent to Cede & Co. If less than all of the
capital securities are being redeemed, DTC will reduce each Direct Participant's
holdings of capital securities in accordance with its procedures.

In those cases where a vote by the holders of the capital securities is
required, neither DTC nor Cede & Co. will itself consent or vote. Under its
usual procedures, DTC would mail an omnibus proxy to Finance Trust I as soon as
possible after the record date. The omnibus proxy assigns Cede & Co.'s
consenting or voting rights to those Direct Participants to whose accounts the
capital securities are credited on the record date, which are identified in a
listing attached to the omnibus proxy.

Finance Trust I will make distribution payments on the capital securities
directly to DTC. DTC's practice is to credit Direct Participants' accounts on
the relevant payment date in accordance with their respective holdings shown on
DTC's records, unless DTC has reason to believe that it will not receive payment
on such payment date.

Payments by participants to beneficial owners will be governed by standing
instructions and customary practices, as is the case with securities held for
the account of customers in bearer form or registered in "street name." These
payments will be the responsibility of the participant and not of DTC, Finance
Trust I or UnionBanCal Corporation.

Except as provided below in "Description of the Junior Subordinated
Debentures--Discontinuance of the Depositary's Services" on page S-94, a
beneficial owner in a global capital security certificate will not be entitled
to receive physical delivery of capital securities. Accordingly, each beneficial
owner must rely on the procedures of DTC to exercise any rights under the
capital securities.

DTC may discontinue providing its services as securities depositary with
respect to the capital securities at any time by giving reasonable notice to
Finance Trust I. In the event that a successor securities depositary is not
obtained, Finance Trust I will print and deliver Capital Securities
certificates. Additionally, the regular trustees, with our consent may decide to
discontinue the book-entry only system of transfers with respect to the capital
securities. In that event, Finance Trust I will print and deliver certificates
for the Capital Securities.

We have obtained the information in this section concerning DTC and DTC's
book-entry system from sources that we and Finance Trust I believe to be
reliable, but neither we nor they take responsibility for the accuracy of the
information.

CERTIFICATED SECURITIES

If the capital securities do not remain in book-entry only form, the
following provisions would apply:

- The property trustee will act as paying agent and may designate an
additional or substitute paying agent at any time.

- Registration of transfers of capital securities will be effected without
charge by or on behalf of Finance Trust I, but the registration will
require payment, with the giving of such indemnity as Finance Trust I or
UnionBanCal Corporation may require, for any tax or other governmental
charges that may be imposed.

- Finance Trust I will not be required to register or cause to be registered
the transfer of capital securities after they have been called for
redemption.

MISCELLANEOUS

The regular trustees are authorized and directed to operate Finance Trust I
in such a way so that Finance Trust I will not be:

- required to register as an "investment company" under the Investment
Company Act of 1940 or

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<PAGE>

- characterized as other than a grantor trust for United States federal
income tax purposes.

We are authorized and directed to conduct our affairs so that the junior
subordinated debentures will be treated as indebtedness for United States
federal income tax purposes.

We and the regular trustees are authorized to take any action, not
inconsistent with applicable law, the certificate of trust of Finance Trust I or
our articles of incorporation, that either we or the regular trustees determine
in either of our discretion to be necessary or desirable to achieve that end, as
long as the action does not adversely affect the interests of the holders of the
capital securities.

S-88
<PAGE>
DESCRIPTION OF THE JUNIOR SUBORDINATED DEBENTURES

THE FOLLOWING DESCRIPTION OF THE JUNIOR SUBORDINATED DEBENTURES IS NOT
COMPLETE. YOU SHOULD ALSO READ THE DESCRIPTION OF THE GENERAL TERMS AND
PROVISIONS OF THE JUNIOR SUBORDINATED DEBT SECURITIES IN THE ACCOMPANYING
PROSPECTUS UNDER THE CAPTION "DESCRIPTION OF DEBT SECURITIES," THE INDENTURE
DATED AS OF , 1999 BETWEEN US AND THE FIRST NATIONAL BANK OF CHICAGO,
AS TRUSTEE, AND THE OFFICER'S CERTIFICATE OF ONE OF OUR EXECUTIVE OFFICERS DATED
, 1999 SUPPLEMENTING THE INDENTURE. WE HAVE FILED THE INDENTURE AS AN
EXHIBIT TO THE REGISTRATION STATEMENT OF WHICH THE ACCOMPANYING PROSPECTUS FORMS
A PART, AND WE WILL FILE THE OFFICER'S CERTIFICATE WITH THE SEC PRIOR TO THE
SALE OF THE CAPITAL SECURITIES.

Under circumstances involving the dissolution of Finance Trust I, the junior
subordinated debentures may be distributed to the holders of the capital
securities and the common securities in liquidation of Finance Trust I. See
"Description of the Trust Preferred Securities--Liquidation Distribution Upon
Dissolution" on page 15 in the accompanying prospectus. If the junior
subordinated debentures are distributed to the holders of capital securities, we
will use our best efforts to have the junior subordinated debentures listed on
the New York Stock Exchange or with another organization on which the capital
securities are then listed.

GENERAL

We will issue the junior subordinated debentures as unsecured debt under the
indenture. The junior subordinated debentures will be limited in aggregate
principal amount to $ - . This amount equals the sum of the aggregate stated
liquidation amount of the capital securities and the amount of capital that we
contributed to Finance Trust I in exchange for the common securities.

The junior subordinated debentures contain no sinking fund provisions. The
entire principal amount of the junior subordinated debentures will mature and
become due and payable, together with any accrued and unpaid interest, including
Compound Interest and Additional Interest, as we define each below, if any, on
, 20 - .

If junior subordinated debentures are distributed to holders of capital
securities in liquidation of those holders' interests in Finance Trust I, the
junior subordinated debentures will initially be issued as a global security. As
described in "Description of the Junior Subordinated Debentures--Discontinuance
of the Depositary's Services" on page S-94, under limited circumstances, junior
subordinated debentures may be issued in certificated form in exchange for a
global security. See "--Book-Entry and Settlement; Depositary" on page S-94 and
"Description of Debt Securities--Registered Global Securities" in the
accompanying prospectus.

If junior subordinated debentures are issued in certificated form, we will
issue them in denominations of $25, and integral multiples of $25, and they may
be transferred or exchanged at the offices described below.

We will make payments on junior subordinated debentures issued as a global
security to DTC, a successor depositary or, if no depositary is used, to a
paying agent for the junior subordinated debentures. If we issue junior
subordinated debentures in certificated form, principal and interest will be
payable, the transfer of the junior subordinated debentures will be registrable,
and junior subordinated debentures will be exchangeable for junior subordinated
debentures of other denominations of a like aggregate principal amount, at the
corporate trust office of the indenture trustee in New York, New York. At our
option, however, we may pay interest by check mailed to the address of the
persons entitled to the interest.

The Indenture does not provide holders of the junior subordinated debentures
protection in the event of a highly leveraged transaction involving UnionBanCal
Corporation that would adversely affect the holders.

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SUBORDINATION

The indenture provides that the junior subordinated debentures rank
subordinate and junior in right of payment to all of our "Senior Indebtedness",
as we define it below. We may not make payment of principal, including
redemption payments, or interest on the junior subordinated debentures if

- any of our Senior Indebtedness is not paid when due and any applicable
grace period after the default has ended and the default has not been
cured or waived or ceased to exist, or

- the maturity of any of our Senior Indebtedness has been accelerated
because of a default, and the acceleration has not been rescinded.

Upon any distribution of our assets to creditors upon our dissolution,
winding-up, liquidation or reorganization, whether voluntary or involuntary, or
in bankruptcy, insolvency, receivership or other proceedings, all principal,
premium, if any, and interest due or to become due on all of our Senior
Indebtedness must be paid in full before the holders of junior subordinated
debentures are entitled to receive or retain any payment. In that event, any
payment or distribution on the junior subordinated debentures that would
otherwise be payable in respect of the junior subordinated debentures but for
the subordination provision will be paid or delivered directly to the holders of
our Senior Indebtedness in accordance with the priorities then existing among
the holders of our Senior Indebtedness until all of our Senior Indebtedness has
been paid in full.

If the indenture trustee or any holder of junior subordinated debentures
receives any payment or distribution on account of the junior subordinated
debentures before all of our Senior Indebtedness is paid in full, then that
payment or distribution will be paid over or delivered and transferred to, the
holders of our Senior Indebtedness at the time outstanding.

The rights of the holders of the junior subordinated debentures will be
subrogated to the rights of the holders of our Senior Indebtedness to the extent
of any payment we made to the holders of our Senior Indebtedness that otherwise
would have been made to the holders of the junior subordinated debentures but
for the subordination provisions.

The term "Senior Indebtedness" means:

(1) the principal, premium, if any, and interest in respect of:

- our indebtedness for money borrowed; and

- indebtedness evidenced by securities, debentures, bonds or other
similar instruments that we issued;

(2) all of our capital lease obligations;

(3) all of our obligations issued or assumed as the deferred purchase price
of property, all of our conditional sale obligations, and all of our obligations
under any title retention agreement (but excluding trade accounts payable
arising in the ordinary course of business);

(4) all of our obligations for reimbursement on any letter of credit,
banker's acceptance, security purchase facility or similar credit transaction;

(5) all obligations of the type referred to in clauses (1) through (4) above
of other persons, but for which we are responsible or liable to make payment as
obligor, guarantor or otherwise; and

(6) all obligations of the type referred to in clauses (1) through (5) above
of other persons secured by any lien on any of our property or assets, whether
or not we assume the obligation.

Notwithstanding (1) through (6) above, the term "Senior Indebtedness" does not
include:

(1) any indebtedness that by its terms is junior or equal to the junior
subordinated debentures;

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(2) any indebtedness between or among an obligor or its affiliates, including
all other debt securities and guarantees in respect of those debt
securities, to:

- any other Trust, as we define it in the accompanying prospectus, or a
trustee of that Trust, and

- any other trust, or a trustee of that trust, a partnership or other entity
affiliated with us that is a financing vehicle of ours and will issue
capital securities or other securities that rank equal or junior to the
capital securities; and

(3) any indebtedness that by its terms is junior to trade accounts payable or
accrued liabilities arising in the ordinary course of business, but only for
amounts as described in the indenture.

Our Senior Indebtedness will continue to be Senior Indebtedness and be
entitled to the benefits of the subordination provisions of the indenture
regardless of any amendment, modification or waiver of any term of the Senior
Indebtedness.

The indenture does not limit how much Senior Indebtedness we can issue. As
of September 30, 1998, we had approximately $ - million in Senior
Indebtedness.

The junior subordinated debentures also will be effectively junior to all
obligations of our subsidiaries.

INTEREST

The junior subordinated debentures will bear interest at an annual rate of
% from the original date of issuance until the principal becomes due and
payable. Interest is payable quarterly in arrears on , ,
and of each year, beginning , 1999. Interest
payments not paid when due will accrue interest, compounded quarterly, at the
annual rate of %.

The amount of interest payable for any period will be computed on the basis
of a 360-day year of twelve 30-day months, and, for any period shorter than a
quarter, on the basis of the actual number of days elapsed per 30-day month.

The interest payment provisions for the junior subordinated debentures
correspond to the distribution provisions for the capital securities. See
"Description of the Capital Securities--Distributions" on page S-80.

OPTION TO EXTEND INTEREST PAYMENT PERIOD

As long as we are not in default on the payment of interest on the junior
subordinated debentures, we have the right, at any time and from time to time,
to defer payments of interest by extending the interest payment period for a
period (an "Extension Period") not exceeding 20 consecutive quarters, but not
beyond the maturity date of the junior subordinated debentures. At the end of
any Extension Period, we will pay all interest then accrued and unpaid, together
with interest on the accrued and unpaid interest as permitted by law ("Compound
Interest"), compounded quarterly, at the annual rate of % plus any Additional
Interest.

During any Extension Period:

- we may not declare or pay any dividends on, make any distribution, or
redeem, purchase, acquire or make a liquidation payment on any of our
capital stock; and

- we may not make any payment of interest, principal or premium, if any, on
or repay, repurchase or redeem any debt securities issued by us that rank
equal or junior to the junior subordinated debentures, or make any
guarantee payments on the foregoing.

The restrictions listed above do not apply to:

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- repurchases, redemptions or other acquisitions of shares of our capital
stock in connection with (1) any employment contract, benefit plan or
other similar arrangement with or for the benefit of any one or more
employees, officers, directors or consultants, (2) a dividend reinvestment
or shareholder stock purchase plan or (3) the issuance of our capital
stock, or securities convertible into or exercisable for our capital
stock, as consideration in an acquisition transaction entered into before
the Extension Period;

- an exchange, redemption or conversion of any class or series of our
capital stock, or any capital stock of a subsidiary of ours, for any class
or series of our capital stock, or of any class or series of our
indebtedness for any class or series of our capital stock;

- the purchase of fractional interests in shares of our capital stock under
the conversion or exchange provisions of the capital stock or the security
being converted or exchanged;

- any declaration of a dividend in connection with any shareholder's rights
plan, or the issuance of rights, stock or other property under any
shareholder's rights plan, or the redemption or repurchase of rights
pursuant to the plan;

- any dividend in the form of stock, warrants, options or other rights where
the dividend or the stock issuable upon exercise of the warrants, options
or other rights is the same stock as that on which the dividend is being
paid or ranks equal or junior to that stock; or

- payments by us under the guarantee of the capital securities or under any
similar guarantee by us of any trust common or trust preferred securities
of our subsidiaries.

The restrictions described above will also apply if we default on our
obligations under the indenture relating to the junior subordinated debentures
or if we default on our obligations under the guarantee of the capital
securities.

Before termination of any Extension Period, we may further extend the
interest payment period. However, the Extension Period, including all previous
and further extensions, may not exceed 20 consecutive quarters or extend beyond
the maturity date of the junior subordinated debentures. After termination of
any Extension Period and the payment of all amounts then due, we may begin a new
Extension Period, as described above.

If the property trustee is the sole holder of the junior subordinated
debentures, we will give the regular trustees and the property trustee notice of
our selection of an Extension Period one business day before the earlier of:

- the next date distributions on the capital securities are payable or

- the date the regular trustees are required to give notice to the New York
Stock Exchange, or other applicable self-regulatory organization, or to
the holders of record of the capital securities.

The regular trustees shall give notice of our selection of an Extension
Period to the holders of the capital securities.

If the property trustee is not the sole holder of the junior subordinated
debentures, we will give the holders of the junior subordinated debentures
notice of our selection of an Extension Period ten business days before the
earlier of:

- the next interest payment date or

- the date upon which we are required to give notice to the New York Stock
Exchange, or other applicable self-regulatory organization, or to holders
of the junior subordinated debentures of the record or payment date of the
related interest payment.

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We have no present intention of exercising our right to defer payments of
interest by extending the interest payment period on the junior subordinated
debentures.

ADDITIONAL INTEREST

If at any time while the property trustee is the holder of the junior
subordinated debentures, Finance Trust I shall be required to pay any taxes,
duties, assessments or governmental charges of whatever nature, other than
withholding taxes, imposed by the United States or any other taxing authority,
then, in any such case, we will pay as additional interest on the junior
subordinated debentures any additional amounts ("Additional Interest") that are
required so that the net amounts received and retained by Finance Trust I after
paying those taxes, duties, assessments or governmental charges will not be less
than the amounts Finance Trust I would have received if those taxes, duties,
assessments or governmental charges had not been imposed.

OPTIONAL REDEMPTION

We have the right, after receipt of prior approval by the Federal Reserve,
if approval is then required, to redeem the junior subordinated debentures:

- on or after , 2004 in whole at any time or in part from time to
time, or

- before , 2004, in whole, but not in part, at any time within 90
days following the occurrence and continuation of a Tax Event, an
Investment Company Event or a Regulatory Capital Event as described under
"Description of the Capital Securities--Redemption" above on page .

In either case, the redemption price will equal 100% of the principal amount
to be redeemed, plus any accrued and unpaid interest, including any Compounded
Interest and any Additional Interest, if any, to the date of redemption.

If a partial redemption of the capital securities resulting from a partial
redemption of the junior subordinated debentures would result in the delisting
of the capital securities, we may only redeem the junior subordinated debentures
in whole.

We may not redeem fewer than all of the junior subordinated debentures
unless we have paid all accrued and unpaid interest on all junior subordinated
debentures for all quarterly interest payment periods terminating on or before
the date of redemption.

OPTION TO ACCELERATE MATURITY DATE

If a Tax Event described in clause (3) of the definition of "Tax Event" on
page S-82 occurs, we will have the right, before a dissolution of Finance Trust
I, to accelerate the stated maturity of the junior subordinated debentures to
the minimum extent required so that interest on the junior subordinated
debentures will be deductible for United States federal income tax purposes. In
no event may the resulting maturity of the junior subordinated debentures be
less than 15 years from the date of original issuance, however.

We may only accelerate the stated maturity if we have received an opinion of
nationally recognized independent counsel experienced in such matters to the
effect that:

- after the acceleration, interest paid on the junior subordinated
debentures will be deductible for United States federal income tax
purposes;

- the holders of capital securities will not recognize income, gain or loss
for United States federal income tax purposes as a result of the
acceleration, and will be taxed under United States federal income tax law
in the same amount, in the manner and at the same times as would have been
the case if the acceleration had not occurred; and

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- the acceleration will not cause Finance Trust I to be classified as other
than a grantor trust for United States federal income tax purposes.

INDENTURE EVENTS OF DEFAULT

If any event of default under the indenture occurs and is continuing, the
property trustee, as the holder of the junior subordinated debentures, will have
the right to declare the principal of and the interest on the junior
subordinated debentures, including any Compound Interest and Additional
Interest, if any, and any other amounts payable under the indenture to be
immediately due and payable and to enforce its other rights as a creditor. See
"Description of Debt Securities--Events of Default" in the accompanying
prospectus for a description of the events of default.

An event of default under the indenture also constitutes an event of default
under the trust declaration. The holders of capital securities, upon an event of
default, have the right to direct the property trustee to exercise its rights as
the holder of the junior subordinated debentures. See "Description of the
Capital Securities--Voting Rights" above on page S-84 for a more complete
discussion of when holders of capital securities may direct the property trustee
to exercise its rights.

BOOK-ENTRY AND SETTLEMENT; DEPOSITARY

If distributed to holders of capital securities in connection with the
involuntary or voluntary dissolution, winding-up or liquidation of Finance Trust
I, the junior subordinated debentures will be issued in the form of one or more
global certificates registered in the name of a depositary or its nominee.
Except under the limited circumstances described immediately below under
"--Discontinuance of the Depositary's Service," junior subordinated debentures
represented by a global security will not be exchangeable for, and will not
otherwise be issuable as, securities in definitive form.

If junior subordinated debentures are distributed to holders of capital
securities upon liquidation of Finance Trust I, DTC will act as securities
depositary for the junior subordinated debentures. For a description of DTC and
the specific terms of the depositary arrangements, see "Description of the
Capital Securities--Book-Entry Only Issuance--The Depository Trust Company"
above on page S-86.

As of the date of this prospectus supplement, that description of DTC's
book-entry system and DTC's practices as they relate to purchases of, transfers
of, notices concerning and payments on the capital securities apply in all
material respects to any debt obligations represented by one or more global
securities held by DTC.

We may appoint a successor to DTC or any successor depositary if DTC or such
successor depositary is unable or unwilling to continue as a depositary for the
global securities.

DISCONTINUANCE OF THE DEPOSITARY'S SERVICES

A global security will be exchangeable for junior subordinated debentures
registered in the names of persons other than the depositary or its nominee only
if:

- the depositary notifies us that it is unwilling or unable to continue as a
depositary for the global security and no successor depositary has been
appointed,

- the depositary ceases to be a clearing agency registered under the
Securities Exchange Act at a time the depositary is required to be so
registered to act as depositary, and no successor depositary has been
appointed,

- we, in our sole discretion, determine that the global security shall be
exchangeable for definitive certificates or

- there shall have occurred an event of default under the indenture.

Any global security that is exchangeable as described above will be
exchangeable for junior subordinated debentures registered in the names the
depositary directs. We expect that the instructions will be based upon
directions received by the depositary from its participants with respect to
ownership of beneficial interests in the global security.

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DESCRIPTION OF THE GUARANTEE

THE FOLLOWING DESCRIPTION OF THE GUARANTEE IS NOT COMPLETE. YOU SHOULD ALSO
READ THE DESCRIPTION OF THE GENERAL TERMS AND PROVISIONS OF THE TRUST PREFERRED
SECURITIES GUARANTEES IN THE ACCOMPANYING PROSPECTUS UNDER THE CAPTION
"DESCRIPTION OF THE TRUST PREFERRED SECURITIES GUARANTEES" AND THE GUARANTEE
AGREEMENT. WE HAVE FILED THE GUARANTEE AGREEMENT AS AN EXHIBIT TO THE
REGISTRATION STATEMENT OF WHICH THE ACCOMPANYING PROSPECTUS FORMS A PART.

GENERAL

Pursuant to the guarantee, we will irrevocably and unconditionally agree, to
the extent set forth in the guarantee, to pay in full to the holders of the
capital securities, the Guarantee Payments, as we define that term below, as and
when due, regardless of any defense, right of set-off or counterclaim that
Finance Trust I may have or assert.

The following payments on the capital securities (the "Guarantee Payments"),
if not fully paid by Finance Trust I, will be covered by the guarantee, without
duplication:

- any accumulated and unpaid distributions that are required to be paid on
the capital securities, in an amount equal to any payments of interest or
principal we have made on the junior subordinated debentures;

- the redemption price, in an amount equal to any payments of interest or
principal we have made on the junior subordinated debentures, for any
capital securities called for redemption; and

- upon a voluntary or involuntary dissolution, winding-up or termination of
Finance Trust I, other than in connection with the distribution of junior
subordinated debentures to the holders of the capital securities or the
redemption of all of the capital securities upon the maturity or
redemption of the junior subordinated debentures, the lesser of:

(1) the aggregate of the $25 liquidation amount and all accumulated and
unpaid distributions on the capital securities to the date of payment
in an amount equal to the funds Finance Trust I has legally available
for payment and

(2) the amount of assets of Finance Trust I remaining available for
distribution to holders of the capital securities in liquidation of
Finance Trust I.

Our obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by us to the holders of the capital securities
or by causing Finance Trust I to pay the amounts to the holders.

The guarantee of the capital securities will be full and unconditional from
the time of issuance, but the guarantee will not apply to any payment of
distributions due if Finance Trust I lacks funds legally available for payment
as a result of a failure by us to make payments of interest or principal on the
junior subordinated debentures.

If we do not make interest payments on the junior subordinated debentures,
Finance Trust I will not pay distributions on the capital securities and will
not have funds legally available for payment. In that event, holders of the
capital securities would not be able to rely upon the guarantee for payment.
Instead, a holder of capital securities would have to rely on the enforcement:

- by the property trustee of its rights as registered holder of the junior
subordinated debentures against UnionBanCal Corporation under the terms of
the junior subordinated debentures or

- by itself of its own rights against UnionBanCal Corporation to enforce
payments on the junior subordinated debentures in the event of a default
by us in the payment of principal or interest on

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the junior subordinated debentures. See "Description of the Capital
Securities--Distributions" above on page S-80.

If the guarantee trustee fails to enforce the guarantee, you may, after your
written request to the guarantee trustee to enforce the guarantee, sue us
directly to enforce the guarantee trustee's rights under the guarantee without
first instituting a legal proceeding against Finance Trust I, the guarantee
trustee, or any other person or entity.

Notwithstanding the foregoing, if we have failed to make a guarantee
payment, you may directly institute a proceeding against us to enforce the
guarantee.

We are required to file annually with the guarantee trustee an officer's
certificate as to our compliance with all conditions under the guarantee.

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UNITED STATES FEDERAL INCOME TAX CONSEQUENCES

GENERAL

This is a summary of United States federal income tax consequences of the
purchase, ownership, and disposition of capital securities that we anticipate
will be material to you. Unless otherwise stated, this summary only deals with
capital securities held as capital assets, generally, assets held for
investment, by holders who purchase the capital securities upon original
issuance. Your tax treatment may vary depending on your particular situation.

This summary does not address:

- all of the tax consequences that may be relevant to holders who may be
subject to special tax treatment such as, for example, financial
institutions, insurance companies, broker-dealers, tax-exempt
organizations or, except as described below, non-U.S. Holders, as we
define that term below,

- the tax consequences to holders that have a functional currency other than
the United States dollar,

- the tax consequences to shareholders, partners or beneficiaries of a
holder of capital securities, or

- any aspects of state, local or foreign tax laws.

We have based this summary on the United States federal income tax law in
effect as of the date of this prospectus supplement. These laws may change,
possibly on a retroactive basis. We urge you to consult your tax advisor as to
the particular tax consequences of purchasing, owning, and disposing of the
capital securities, including the application and effect of United States
federal, state, local, foreign and other tax laws.

For purposes of this discussion, a "U.S. Holder" means:

- a citizen or resident of the United States,

- a corporation, partnership, or other entity created or organized in the
United States or under the laws of the United States or of any political
subdivision of the United States,

- an estate, the income of which is includible in gross income for United
States federal income tax purposes regardless of its source, or

- a trust, the administration of which is subject to the primary supervision
of a United States court and that has one or more United States persons
who have the authority to control all substantial decisions of the trust.

CLASSIFICATION OF THE JUNIOR SUBORDINATED DEBENTURES

In connection with the issuance of the junior subordinated debentures,
Skadden, Arps, Slate, Meagher & Flom LLP, special tax counsel to UnionBanCal
Corporation and Finance Trust I ("Tax Counsel"), has rendered an opinion
stating, generally, that, under current law and assuming full compliance with
the terms of the trust declaration, the indenture and other documents, and based
on facts and assumptions contained in Tax Counsel's opinion, the junior
subordinated debentures will be classified for United States federal income tax
purposes as indebtedness of UnionBanCal Corporation. We have filed the opinion
of Tax Counsel as Exhibit 8.1 to the registration statement of which the
accompanying prospectus forms a part. By accepting the capital securities, you
agree to treat the junior subordinated debentures as indebtedness for United
States federal income tax purposes and to treat the capital securities as
evidence of an indirect beneficial ownership interest in the junior subordinated
debentures.

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CLASSIFICATION OF THE TRUST

In connection with the issuance of the capital securities, Tax Counsel has
rendered an opinion stating, generally, that, under current law and assuming
full compliance with the terms of the trust declaration, the indenture and other
documents, and based on facts and assumptions contained in Tax Counsel's
opinion, Finance Trust I will be classified for United States federal income tax
purposes as a grantor trust and not as an association taxable as a corporation.
We have filed the opinion of Tax Counsel as Exhibit 8.1 to the registration
statement of which the accompanying prospectus forms a part.

Accordingly, for United States federal income tax purposes, you will
generally be treated as the owner of an undivided interest in the junior
subordinated debentures. As further discussed below, you will be required to
include in ordinary income your allocable share of interest, or OID, if any,
paid or accrued on the junior subordinated debentures.

POTENTIAL EXTENSION OF INTEREST PAYMENT PERIOD AND ORIGINAL ISSUE DISCOUNT

In general, a debt instrument will be deemed to be issued with OID if there
is more than a "remote" contingency that periodic stated interest payments due
on the instrument will not be timely paid. Because the exercise by us of our
option to defer the payment of stated interest on the junior subordinated
debentures would prevent us from declaring dividends on any class of equity, we
believe that the likelihood that we would exercise the option is "remote" as
determined under United States federal income tax law.

As a result, we intend to take the position, based on the advice of Tax
Counsel, that the junior subordinated debentures will not be deemed to be issued
with OID. Accordingly, based on this position, stated interest payments on the
junior subordinated debentures will be includible in your ordinary income at the
time that those payments are paid or accrued in accordance with your regular
method of accounting. Because these Treasury Regulations have not yet been
addressed in any published rulings or other published interpretations issued by
the Internal Revenue Service, it is possible that the Internal Revenue Service
could take a position contrary to the position taken by us.

EXERCISE OF DEFERRAL OPTION. If we exercise our option to defer the payment
of stated interest on the junior subordinated debentures, they would be treated,
solely for purpose of the OID rules, as being "re-issued" at that time with OID.
Under these rules, you would be required to include OID in ordinary income, on a
current basis, over the period that the instrument is held, even though we would
not be making any actual cash payments during the extended interest payment
period.

The amount of interest income includible in the taxable income of a holder
of the junior subordinated debentures would be determined on the basis of a
constant yield method over the remaining term of the instrument, and the actual
receipt of future payments of stated interest on the junior subordinated
debentures would no longer be separately reported as taxable income. The amount
of OID that would accrue, in total, during the extended interest payment period
would be approximately equal to the amount of the cash payment due at the end of
the period. Any OID included in income would increase the holder's adjusted tax
basis in the capital securities or the junior subordinated debentures, as the
case may be, and the holder's actual receipt of interest payments would reduce
your adjusted tax basis.

Because income on the capital securities will constitute interest income for
United States federal income tax purposes, corporate holders of capital
securities will not be entitled to claim a dividends received deduction in
respect of such income.

RECEIPT OF JUNIOR SUBORDINATED DEBENTURES OR CASH UPON LIQUIDATION OF FINANCE
TRUST I

If we exercise our right to terminate Finance Trust I and cause the junior
subordinated debentures to be distributed to you on a basis proportionate to
your ownership in the capital securities, the distribution would be treated as a
nontaxable event to you. In that event, you would have an adjusted tax basis in
the junior subordinated debentures that you receive equal to the adjusted tax
basis in the capital securities that

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you surrender, and the holding period of the junior subordinated debentures
would include the period during which you held the capital securities.

If, however, Finance Trust I is characterized for United States federal
income tax purposes, as an association taxable as a corporation at the time of
the termination, the distribution of the junior subordinated debentures would be
a taxable event to the holders of capital securities.

If we redeem the junior subordinated debentures for cash and Finance Trust I
distributes the proceeds of the redemption to holders in redemption of their
capital securities, the redemption would be treated as a sale of the capital
securities in which you would recognize gain or loss as described immediately
below.

SALE OF CAPITAL SECURITIES

Upon the sale of capital securities, you will recognize gain or loss in an
amount equal to the difference between your adjusted tax basis in the capital
securities and the amount realized in the sale, except for any amount you
received for accrued but unpaid interest not previously included in income. The
gain or loss will be capital gain or loss and will be long-term capital gain or
loss if you have held the capital securities for more than one year. Capital
losses generally cannot be applied to offset ordinary income for United States
federal income tax purposes.

The capital securities may trade at a price that does not accurately reflect
the value of accrued but unpaid interest, or OID, if the junior subordinated
debentures are treated as having been issued, or reissued, with OID, relating to
the underlying junior subordinated debentures. If you dispose of your capital
securities you will be required to include in your ordinary income:

- any portion of the amount realized that is attributable to accrued but
unpaid interest to the extent not previously included in income or

- any amount of OID that has accrued on your proportionate share of the
underlying junior subordinated debentures during the taxable year of sale
through the date of disposition.

Any income inclusion will increase your adjusted tax basis in the capital
securities that you dispose of.

NON-U.S. HOLDERS

Payments made to a holder of capital securities who is a non-U.S. Holder
will not be subject to withholding of United States federal income tax, if:

- the beneficial owner of the capital securities does not actually or
constructively own 10% or more of the total combined voting power of all
of our classes of stock entitled to vote,

- the beneficial owner of the capital securities is not a controlled foreign
corporation that is related to us through stock ownership, and

- either:

(1) the beneficial owner of the capital securities certifies to
Finance Trust I or its agent, under penalties of perjury, that it is not
a United States holder and provides his name and address, or

(2) a securities clearing organization, bank or other financial
institution that holds customers' securities in the ordinary course of
its trade or business (a "Financial Institution"), and holds the capital
securities in that capacity, certifies to Finance Trust I or its agent,
under penalties of perjury, that such statement has been received from
the beneficial owner by it or by a Financial Institution between it and
the beneficial owner and furnishes Finance Trust I or its agent with a
copy of the statement.

S-99
<PAGE>

In addition, a non-U.S. Holder of capital securities will not be subject to
withholding of United States federal income tax on any gain realized upon the
sale or other disposition of a capital security.

INFORMATION REPORTING

Generally, income on the capital securities will be reported to you on Forms
1099, which should be mailed to you by January 31 following each calendar year.

S-100
<PAGE>

ERISA CONSIDERATIONS

Each fiduciary of a pension, profit-sharing or other employee benefit plan
to which Title I of the Employee Retirement Income Security Act of 1974
("ERISA") applies (a "Plan"), should consider the fiduciary standards of ERISA
in the context of the Plan's particular circumstances before authorizing an
investment in the capital securities. Accordingly, among other factors, the
fiduciary should consider whether the investment would satisfy the prudence and
diversification requirements of ERISA and would be consistent with the documents
and instruments governing the Plan.

Section 406 of ERISA and Section 4975 of the Internal Revenue Code prohibit
Plans, as well as individual retirement accounts and Keogh plans to which
Section 4975 of the Internal Revenue Code applies (also "Plans"), from engaging
in specified transactions involving "plan assets" with persons who are "parties
in interest" under ERISA or "disqualified persons" under the Internal Revenue
Code ("Parties in Interest") with respect to such Plan. A violation of those
"prohibited transaction" rules may result in an excise tax or other liabilities
under ERISA and/or Section 4975 of the Internal Revenue Code for such persons,
unless exemptive relief is available under an applicable statutory or
administrative exemption.

Employee benefit plans that are governmental plans, as defined in Section
3(32) of ERISA, church plans, as defined in Section 3(33) of ERISA, and foreign
plans, as described in Section 4(b)(5) of ERISA, are not subject to the
requirements of ERISA, or Section 4975 of the Internal Revenue Code.

Under a regulation (the "Plan Assets Regulation") issued by the U.S.
Department of Labor, the assets of Finance Trust I would be deemed to be "plan
assets" of a Plan for purposes of ERISA and Section 4975 of the Internal Revenue
Code if a Plan makes an "equity" investment in Finance Trust I and no exception
were applicable under the Plan Assets Regulation. An "equity interest" is
defined under the Plan Assets Regulation as any interest in an entity other than
an instrument that is treated as indebtedness under applicable local law and
which has no substantial equity features and specifically includes a beneficial
interest in a trust.

If the assets of Finance Trust I were deemed to be "plan assets," the
persons providing services to the assets of Finance Trust I may become Parties
in Interest or Disqualified Persons for an investing Plan and may be governed by
the fiduciary responsibility provisions of Title I of ERISA and the prohibited
transaction provisions of ERISA and Section 4975 of the Internal Revenue Code
with respect to transactions involving those assets.

In this regard, if the person or persons with discretionary responsibilities
over the junior subordinated debentures or the guarantee were affiliated with
us, any such discretionary actions taken regarding those assets could be deemed
to constitute a prohibited transaction under ERISA or the Internal Revenue Code
(e.g., the use of such fiduciary authority or responsibility in circumstances
under which those persons have interests that may conflict with the interests of
the investing Plans and affect the exercise of their best judgement as
fiduciaries).

Under an exception contained in the Plan Assets Regulation, the assets of
Finance Trust I would not be deemed to be "plan assets" of investing Plans if
the capital securities are "publicly-offered securities"-- that is, they are:

- widely held, I.E., owned by more than 100 investors independent of Finance
Trust I and of each other,

- freely transferable and

- sold to a Plan as part of an offering pursuant to an effective
registration statement under the Securities Act of 1933, and then timely
registered under Section 12(b) or 12(g) of the Securities Exchange Act of
1934.

S-101
<PAGE>

We expect that the capital securities will meet the criteria of
"publicly-offered securities" above, although no assurance can be given in this
regard. The underwriters expect that the capital securities will be held by at
least 100 independent investors at the conclusion of the offering and that the
capital securities will be freely transferable. The capital securities will be
sold as part of an offering under an effective registration statement under the
Securities Act of 1933, and then will be timely registered under the Securities
Exchange Act of 1934.

All of the common securities will be purchased and held by us.

Even if the assets of Finance Trust I are not deemed to be "Plan Assets" or
Plans investing in Finance Trust I, specified transactions involving Finance
Trust I could be deemed to constitute direct or indirect prohibited transactions
under ERISA and Section 4975 of the Internal Revenue Code regarding an investing
Plan.

For example, if we are a Party in Interest with respect to an investing
plan, either directly or by reason of the activities of one or more of our
affiliates, extensions of credit between us and Finance Trust I, as represented
by the junior subordinated debentures and the guarantee, would likely be
prohibited by Section 406(a)(1)(B) of ERISA and Section 4975(c)(1)(B) of the
Internal Revenue Code, unless exemptive relief were available under an
applicable administrative exemption.

The U.S. Department of Labor has issued five prohibited transaction class
exemptions ("PTCEs") that may provide exemptive relief for direct or indirect
prohibited transactions resulting from the purchase or holding of the capital
securities. Those class exemptions are:

- PTCE 96-23, for specified transactions determined by in-house asset
managers,

- PTCE 95-60, for specified transactions involving insurance company general
accounts,

- PTCE 91-38, for specified transactions involving bank collective
investment funds,

- PTCE 90-1, for specified transactions involving insurance company separate
accounts, and

- PTCE 84-14, for specified transactions determined by independent qualified
professional asset managers.

The capital securities may not be purchased or held by any Plan, any entity
whose underlying assets include "plan assets" by reason of any Plan's investment
in the entity (a "Plan Asset Entity") or any person investing "plan assets" of
any Plan, unless the purchaser or holder is eligible for the exemptive relief
available under PTCE 96-23, 95-60, 91-38, 90-1 or 84-14.

Any purchaser or holder of the capital securities or any interest in the
capital securities will be deemed to have represented by its purchase and
holding that it either:

- is not a Plan or a Plan Asset Entity and is not purchasing such securities
on behalf of or with "plan assets" of any Plan or

- is eligible for the exemptive relief available under PTCE 96-23, 95-60,
91-38, 90-1 or 84-14 with respect to such purchase or holding.

Due to the complexity of these rules and the penalties that may be imposed
upon persons involved in non-exempt prohibited transactions, it is particularly
important that fiduciaries or other persons considering purchasing the capital
securities on behalf of or with "plan assets" of any Plan consult with their
counsel regarding the potential consequences if the assets of Finance Trust I
were deemed to be "plan assets" and the availability of exemptive relief under
PTCE 96-23, 95-60, 91-38, 90-1 or 84-14.

S-102
<PAGE>
UNDERWRITERS

Under the terms and conditions of an Underwriting Agreement dated the date
of this prospectus supplement, the underwriters named below, for whom Morgan
Stanley & Co. Incorporated, Salomon Smith Barney Inc. and are acting
as representatives, have severally agreed to purchase, and Finance Trust I has
agreed to sell to them, the respective number of capital securities indicated
below. The activities of the underwriters are led jointly in this transaction by
Morgan Stanley & Co. Incorporated and Salomon Smith Barney Inc. Morgan Stanley &
Co. Incorporated is acting as the bookrunner for the offering of the capital
securities.

<TABLE>
<CAPTION>
NUMBER
OF
CAPITAL
NAME SECURITIES
- ------------------------------------------------------------------------------- -------------
<S> <C>
Morgan Stanley & Co. Incorporated..............................................
Salomon Smith Barney Inc.......................................................

-------------
Total......................................................................
-------------
-------------
</TABLE>

The underwriters are offering the capital securities subject to their
acceptance of the securities from Finance Trust I and subject to prior sale. The
Underwriting Agreement provides that the obligations of the several underwriters
to pay for and accept delivery of the capital securities are conditioned on the
delivery of legal opinions by their counsel. The underwriters are obligated to
purchase all the capital securities, except those covered by the underwriters'
over-allotment option discussed below, if any are purchased.

The underwriters initially propose to offer part of the capital securities
directly to the public at the public offering price set forth on the cover page
of this prospectus supplement. The underwriters may also offer the capital
securities to securities dealers at a price that represents a concession not in
excess of $ per capital security. Any underwriter may allow, and dealers
may reallow, a concession not in excess of $ per capital security to
other underwriters or to securities dealers. After the initial offering of the
capital securities, the offering price and other selling terms may from time to
time be changed by the representatives.

The underwriters have an option to purchase from Finance Trust I up to
additional capital securities at the public offering price set forth on the
cover page of this prospectus supplement. The underwriters' option is
exercisable for 30 days from the date of this prospectus supplement. The
underwriters may exercise this option only for the purpose of covering
over-allotments, if any, made in connection with this offering. If the
underwriters' option is exercised in full, the total price to the public for
this offering would be $ , the total underwriting discounts and
commissions would be $ and the total proceeds to UnionBanCal Corporation
would be $ .

Because the proceeds of the sale of the capital securities will ultimately
be used to purchase our junior subordinated debentures, the Underwriting
Agreement provides that we will pay to the underwriters as compensation for
their services $ per capital security or $ in the aggregate and
$ in the aggregate if the underwriters' option to purchase additional
capital securities is exercised in full. The underwriting commission for sales
of 10,000 or more capital securities to a single purchaser will be $ per
capital security. If any of these sales occur, the total underwriting commission
will be less then $ .

UnionBanCal Corporation and Finance Trust I have agreed that, without the
prior written consent of Morgan Stanley & Co. Incorporated, on behalf of the
underwriters, they will not, during the period

S-103
<PAGE>
beginning on the date of the Underwriting Agreement and continuing to and
including the closing under the Underwriting Agreement:

- offer, pledge, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right
or warrant to purchase, lend or otherwise transfer or dispose of, directly
or indirectly, any securities that are substantially similar to the
capital securities or securities convertible into or exercisable or
exchangeable for such securities; or

- enter into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of such
securities,

whether any transaction described above is to be settled by securities, in cash
or otherwise, except in the offering.

Prior to this offering, there has been no public market for the capital
securities. The capital securities will be listed on the New York Stock Exchange
under the trading symbol "UBT". In order to meet one of the requirements for
listing the capital securities on the New York Stock Exchange, the underwriters
intend to sell capital securities to a minimum of 400 beneficial holders in lots
of 100 or more. Trading of the capital securities on the New York Stock Exchange
is expected to begin within a 30-day period after the date of this prospectus
supplement. The representatives have advised Finance Trust I that they presently
intend to make a market in the capital securities prior to the commencement of
trading on the New York Stock Exchange. The representatives are not obligated to
make a market in the capital securities, however, and may cease market making
activities at any time. We cannot give any assurance as to the liquidity of any
trading market for the capital securities.

Finance Trust I, UnionBanCal Corporation and the underwriters have agreed to
indemnify each other against certain liabilities, including liabilities under
the Securities Act.

In order to facilitate the offering of the capital securities, the
underwriters may engage in transactions that stabilize, maintain or otherwise
affect the price of the capital securities. Specifically, the underwriters may
over-allot in connection with the offering, creating a short position in the
capital securities for their own account. In addition, to cover over-allotments
or to stabilize the price of the capital securities, the underwriters may bid
for, and purchase, capital securities in the open market. Finally, the
underwriting syndicate may reclaim selling concessions allowed to an underwriter
or a dealer for distributing the capital securities in the offering, if the
syndicate repurchases previously distributed capital securities in transactions
to cover syndicate short positions, in stabilization transactions or otherwise.
Any of these activities may stabilize or maintain the market price of the
capital securities above independent market levels. The underwriters are not
required to engage in these activities, and may end any of these activities at
any time.

From time to time, some of the underwriters and their affiliates have
engaged in, and may in the future engage in commercial banking and investment
banking transactions with UnionBanCal Corporation and its affiliates.

LEGAL MATTERS

The validity of the junior subordinated debentures and the guarantee will be
passed upon for UnionBanCal Corporation by Skadden, Arps, Slate, Meagher & Flom
LLP, Los Angeles, California. Legal matters will be passed upon for the
underwriters by Davis Polk & Wardwell, New York, New York. United States federal
income taxation matters and matters of Delaware law relating to the validity of
the capital securities, the enforceability of the trust declaration and the
creation of Finance Trust I will be passed upon by Skadden, Arps, Slate, Meagher
& Flom LLP, Los Angeles, California.

S-104
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
---------
<S> <C>
Consolidated Statements of Income for the Years Ended December 31, 1995, 1996 and 1997 and for the Nine
Months Ended September 30, 1997 (unaudited) and 1998 (unaudited)....................................... F-2

Consolidated Balance Sheets as of December 31, 1996 and 1997 and September 30, 1998 (unaudited).......... F-3

Consolidated Statements of Changes in Shareholders' Equity for the Years Ended December 31, 1995, 1996
and 1997 and for the Nine Months Ended September 30, 1998 (unaudited).................................. F-4

Consolidated Statements of Cash Flows for the Years Ended December 31, 1995, 1996 and 1997 and for the
Nine Months Ended September 30, 1997 (unaudited) and 1998 (unaudited).................................. F-5

Notes to Consolidated Financial Statements............................................................... F-6

Independent Auditors' Reports............................................................................ F-50
</TABLE>

F-1
<PAGE>
UNIONBANCAL CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

<TABLE>
<CAPTION>
FOR THE NINE MONTHS
YEARS ENDED DECEMBER 31, ENDED SEPTEMBER 30,
------------------------------- ----------------------
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA) 1995 1996 1997 1997 1998
- ----------------------------------------------------------- --------- --------- --------- ----------- ---------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
INTEREST INCOME
Loans...................................................... $1,613,376 $1,687,977 $1,763,277 $1,311,337 $1,365,285
Securities................................................. 132,802 143,412 167,440 123,075 145,390
Interest bearing deposits in banks......................... 58,201 52,709 56,748 43,404 14,187
Federal funds sold and securities purchased under resale
agreements............................................... 22,247 30,246 26,079 18,727 11,784
Trading account assets..................................... 20,567 12,960 19,917 13,388 19,976
--------- --------- --------- ----------- ---------
Total interest income.................................. 1,847,193 1,927,304 2,033,461 1,509,931 1,556,622
--------- --------- --------- ----------- ---------
INTEREST EXPENSE
Domestic deposits.......................................... 358,049 460,130 520,583 386,699 353,283
Foreign deposits........................................... 96,109 71,437 75,398 55,156 66,455
Federal funds purchased and securities sold under
repurchase agreements.................................... 78,908 47,095 58,544 44,053 59,667
Commercial paper........................................... 86,695 87,411 89,912 66,543 67,719
Subordinated capital notes................................. 42,538 30,104 22,850 17,180 15,883
Other borrowed funds....................................... 42,561 62,549 34,492 26,999 13,976
--------- --------- --------- ----------- ---------
Total interest expense................................. 704,860 758,726 801,779 596,630 576,983
--------- --------- --------- ----------- ---------
NET INTEREST INCOME........................................ 1,142,333 1,168,578 1,231,682 913,301 979,639
Provision for credit losses................................ 53,250 40,000 -- -- 45,000
--------- --------- --------- ----------- ---------
Net interest income after provision for credit
losses............................................... 1,089,083 1,128,578 1,231,682 913,301 934,639
--------- --------- --------- ----------- ---------
NONINTEREST INCOME
Service charges on deposit accounts........................ 95,177 101,975 114,647 84,699 101,288
Trust and investment management fees....................... 87,743 93,479 107,527 76,737 88,806
International commissions and fees......................... 68,621 66,108 66,122 49,593 54,516
Merchant transaction processing fees....................... 45,767 49,778 57,128 42,653 42,988
Merchant banking fees...................................... 24,483 23,929 24,924 19,899 24,083
Securities gains (losses), net............................. (702) 4,502 2,711 2,098 5,579
Other...................................................... 74,230 78,905 89,942 66,948 82,689
--------- --------- --------- ----------- ---------
Total noninterest income............................... 395,319 418,676 463,001 342,627 399,949
--------- --------- --------- ----------- ---------
NONINTEREST EXPENSE
Salaries and employee benefits............................. 536,671 557,247 571,644 418,970 459,592
Net occupancy.............................................. 92,863 103,335 85,630 64,133 67,294
Equipment.................................................. 55,056 55,942 56,137 41,206 41,842
Foreclosed asset expense (income).......................... (3,213) 2,889 (1,268) (696) (746)
Merger and integration..................................... -- 117,464 6,037 6,037 --
Other...................................................... 296,724 298,027 326,485 232,558 268,196
--------- --------- --------- ----------- ---------
Total noninterest expense.............................. 978,101 1,134,904 1,044,665 762,208 836,178
--------- --------- --------- ----------- ---------
Income before income taxes................................. 506,301 412,350 650,018 493,720 498,410
Income tax expense......................................... 193,359 162,892 238,722 174,869 146,045
--------- --------- --------- ----------- ---------
NET INCOME................................................. $ 312,942 $ 249,458 $ 411,296 $ 318,851 $ 352,365
--------- --------- --------- ----------- ---------
--------- --------- --------- ----------- ---------
NET INCOME APPLICABLE TO COMMON STOCK...................... $ 301,637 $ 238,152 $ 403,696 $ 311,251 $ 352,365
--------- --------- --------- ----------- ---------
--------- --------- --------- ----------- ---------
NET INCOME PER COMMON SHARE -- BASIC(1).................... $ 1.74 $ 1.37 $ 2.31 $ 1.78 $ 2.01
--------- --------- --------- ----------- ---------
--------- --------- --------- ----------- ---------
NET INCOME PER COMMON SHARE -- DILUTED(1).................. $ 1.73 $ 1.36 $ 2.30 $ 1.78 $ 2.01
--------- --------- --------- ----------- ---------
--------- --------- --------- ----------- ---------
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING -- BASIC(1)..... 173,806 174,391 174,683 174,615 175,091
--------- --------- --------- ----------- ---------
--------- --------- --------- ----------- ---------
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING -- DILUTED(1)... 174,099 174,784 175,189 175,071 175,729
--------- --------- --------- ----------- ---------
--------- --------- --------- ----------- ---------
</TABLE>

- ------------------------------

(1) Amounts restated to give retroactive effect to the stock split referred to
in Note 1 of the accompanying notes to Consolidated Financial Statements.

See accompanying notes to consolidated financial statements.

F-2
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
DECEMBER 31,
----------------------
(DOLLARS IN THOUSANDS, EXCEPT SHARE DATA) 1996 1997
- ------------------------------------------------------------------------- ---------- ---------- SEPTEMBER 30,
1998
-------------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Cash and due from banks.................................................. $2,268,771 $2,541,699 $ 2,211,595
Interest bearing deposits in banks....................................... 1,131,216 633,421 133,165
Federal funds sold and securities purchased under resale agreements...... 537,710 24,335 629,784
---------- ---------- -------------
Total cash and cash equivalents...................................... 3,937,697 3,199,455 2,974,544
Trading account assets................................................... 465,782 394,313 357,515
Securities available for sale............................................ 2,164,197 2,538,386 3,200,376
Securities held to maturity (fair value: December 31, 1996, $274,405;
December 31, 1997, $193,115; September 30, 1998, $165,807
(unaudited))........................................................... 268,196 188,775 162,018
Loans (net of allowance for credit losses: December 31, 1996, $523,946;
December 31, 1997, $451,692; September 30, 1998, $473,717
(unaudited))........................................................... 20,525,841 22,289,716 23,024,128
Due from customers on acceptances........................................ 778,378 773,339 464,581
Premises and equipment, net.............................................. 410,621 406,299 407,863
Other assets............................................................. 683,347 794,982 816,293
---------- ---------- -------------
Total assets......................................................... $29,234,059 $30,585,265 $31,407,318
---------- ---------- -------------
---------- ---------- -------------

LIABILITIES
Domestic deposits:
Noninterest bearing.................................................... $7,381,078 $8,574,515 $ 9,427,080
Interest bearing....................................................... 12,607,691 12,666,458 12,379,167
Foreign deposits:
Noninterest bearing.................................................... 274,031 275,029 247,038
Interest bearing....................................................... 1,270,160 1,780,372 1,609,844
---------- ---------- -------------
Total deposits....................................................... 21,532,960 23,296,374 23,663,129
Federal funds purchased and securities sold under repurchase
agreements............................................................. 1,322,654 1,335,884 1,574,163
Commercial paper......................................................... 1,495,463 966,575 1,417,077
Other borrowed funds..................................................... 749,422 476,010 339,340
Acceptances outstanding.................................................. 778,378 773,339 464,581
Other liabilities........................................................ 478,249 709,784 666,078
Subordinated capital notes............................................... 382,000 348,000 298,000
---------- ---------- -------------
Total liabilities.................................................... 26,739,126 27,905,966 28,422,368
---------- ---------- -------------
Commitments and contingencies

SHAREHOLDERS' EQUITY
Preferred stock:
Authorized 5,000,000 shares 8 3/8% Noncumulative, Series A, issued
1,350,000 shares in 1996........................................... 135,000 -- --
Common stock(1)--$1.67 stated value:
Authorized 300,000,000 shares, issued 174,457,602 shares as of
December 31, 1996, 174,917,673 shares as of December 31, 1997 and
175,208,037 shares as of September 30, 1998 (unaudited)............ 290,762 291,529 292,013
Additional paid-in capital............................................. 1,413,076 1,422,680 1,430,539
Retained earnings...................................................... 645,214 957,662 1,233,068
Accumulated other comprehensive income................................. 10,881 7,428 29,330
---------- ---------- -------------
Total shareholders' equity........................................... 2,494,933 2,679,299 2,984,950
---------- ---------- -------------
Total liabilities and shareholders' equity........................... $29,234,059 $30,585,265 $31,407,318
---------- ---------- -------------
---------- ---------- -------------
</TABLE>

- ------------------------------

(1) Amounts restated to give retroactive effect to the stock split referred to
in Note 1 of the accompanying notes to Consolidated Financial Statements.

See accompanying notes to consolidated financial statements.

F-3
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
-------------------------------
(DOLLARS IN THOUSANDS) 1995 1996 1997
- --------------------------------------------------------------- --------- --------- --------- FOR THE NINE
MONTHS ENDED
SEPTEMBER 30,
1998
-------------
(UNAUDITED)
<S> <C> <C> <C> <C>
PREFERRED STOCK
Balance, beginning of period................................... $ 135,000 $ 135,000 $ 135,000 $ --
Redemption of preferred stock.................................. -- -- (135,000) --
--------- --------- --------- -------------
Balance, end of period....................................... $ 135,000 $ 135,000 $ -- $ --
--------- --------- --------- -------------
COMMON STOCK
Balance, beginning of period................................... $ 286,739 $ 290,300 $ 290,762 $ 291,529
Dividend reinvestment plan..................................... 3,103 121 6 6
Deferred compensation -- restricted stock awards............... 379 207 279 281
Stock options exercised........................................ 79 134 482 197
--------- --------- --------- -------------
Balance, end of period....................................... $ 290,300 $ 290,762 $ 291,529 $ 292,013
--------- --------- --------- -------------
ADDITIONAL PAID-IN CAPITAL
Balance, beginning of period................................... $1,390,925 $1,408,960 $1,413,076 $ 1,422,680
Dividend reinvestment plan..................................... 15,238 1,041 (43) 10
Deferred compensation -- restricted stock awards............... 2,268 2,148 3,478 5,217
Stock options exercised........................................ 529 927 6,169 2,632
--------- --------- --------- -------------
Balance, end of period....................................... $1,408,960 $1,413,076 $1,422,680 $ 1,430,539
--------- --------- --------- -------------
RETAINED EARNINGS
Balance, beginning of period................................... $ 376,468 $ 626,172 $ 645,214 $ 957,662
Net income(1).................................................. 312,942 249,458 411,296 352,365
Dividends on common stock(2)(3)................................ (50,989) (73,932) (89,848) (73,632)
Dividends on preferred stock................................... (11,305) (11,306) (7,600) --
Dividend to MBL................................................ -- (144,890) -- --
Deferred compensation -- restricted stock awards............... (944) (288) (1,400) (3,327)
--------- --------- --------- -------------
Balance, end of period......................................... $ 626,172 $ 645,214 $ 957,662 $ 1,233,068
--------- --------- --------- -------------
ACCUMULATED OTHER COMPREHENSIVE INCOME
Balance, beginning of period................................... $ (9,930) $ 23,660 $ 10,881 $ 7,428
--------- --------- --------- -------------
Net income(1).................................................. 312,942 249,458 411,296 352,365
Other comprehensive income..................................... 33,590 (12,779) (3,453) 21,902
--------- --------- --------- -------------
Total comprehensive income..................................... 346,532 236,679 407,843 374,267
Less: net income included in retained earnings................. (312,942) (249,458) (411,296) (352,365)
--------- --------- --------- -------------
Balance, end of period....................................... $ 23,660 $ 10,881 $ 7,428 $ 29,330
--------- --------- --------- -------------
TOTAL SHAREHOLDERS' EQUITY................................. $2,484,092 $2,494,933 $2,679,299 $ 2,984,950
--------- --------- --------- -------------
--------- --------- --------- -------------
</TABLE>

- ------------------------------

(1) Includes dividends applicable to preferred shareholders of $11.3 million for
the years ended December 31, 1995 and 1996, respectively, and $7.6 million
for the year ended December 31, 1997.

(2) Dividends per share in 1996 were based on historical Union Bank common cash
dividends declared and did not include the $145 million dividend paid to The
Mitsubishi Bank, Limited (MBL) in the first quarter of 1996 by BanCal
Tri-State Corporation and The Bank of California, N.A.

(3) Dividends per share, after giving effect to the stock split referred to in
Note 1 of the accompanying notes to Consolidated Financial Statements, were
$0.47 in 1995 and 1996, respectively, $0.51 in 1997, and $0.42 for the nine
months ended September 30, 1998, (unaudited) and are based on the Company's
shares outstanding as of the declaration date.

See accompanying notes to consolidated financial statements.

F-4
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
FOR THE NINE MONTHS
YEARS ENDED DECEMBER 31, ENDED SEPTEMBER 30,
--------------------------------- -----------------------
(DOLLARS IN THOUSANDS) 1995 1996 1997 1997 1998
- -------------------------------------------------------------- ---------- --------- ---------- ----------- ----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income.................................................. $ 312,942 $ 249,458 $ 411,296 $ 318,851 $ 352,365
Adjustments to reconcile net income to net cash provided by
operating activities:
Provision for credit losses............................... 53,250 40,000 -- -- 45,000
Depreciation, amortization and accretion.................. 61,767 65,092 65,469 49,285 50,528
Provision for deferred income taxes....................... 50,841 50,658 59,814 38,734 16,018
(Gain) loss on sales of securities available for sale..... 801 (4,502) (2,711) (2,098) (5,579)
Merger and integration costs in excess of (less than) cash
utilized................................................ -- 54,344 (31,414) (27,200) (12,350)
Net (increase) decrease in trading account assets......... 82,541 (359,234) 52,743 (37,045) 36,798
Other, net................................................ 157,244 52,101 173,706 92,393 (33,448)
---------- --------- ---------- ----------- ----------
Total adjustments......................................... 406,444 (101,541) 317,607 114,069 96,967
---------- --------- ---------- ----------- ----------
Net cash provided by operating activities................... 719,386 147,917 728,903 432,920 449,332
---------- --------- ---------- ----------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales of securities available for sale........ 240,731 19,536 171,629 3,920 418,456
Proceeds from matured and called securities available for
sale...................................................... 764,853 757,463 587,034 326,833 196,358
Purchase of securities available for sale................... (1,452,339) (995,479) (1,112,080) (777,281) (1,253,529)
Proceeds from matured and called securities held to
maturity.................................................. 213,337 95,829 79,828 36,121 26,960
Purchase of securities held to maturity..................... (123,886) -- -- -- --
Net increase in loans....................................... (2,478,608) (741,335) (1,788,179) (1,315,578) (797,343)
Other, net.................................................. (34,902) (54,120) (56,584) (19,986) (42,032)
---------- --------- ---------- ----------- ----------
Net cash used by investing activities..................... (2,870,814) (918,106) (2,118,352) (1,745,971) (1,451,130)
---------- --------- ---------- ----------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase in deposits.................................... 2,245,306 1,877,917 1,763,414 1,441,228 366,755
Net increase (decrease) in federal funds purchased and
securities sold under repurchase agreements............... (287,387) 127,596 13,230 (27,711) 238,279
Net increase (decrease) in commercial paper and other
borrowed funds............................................ 623,612 (201,214) (797,464) 94,601 313,832
Maturity and redemption of subordinated debt................ (154,490) (119,369) (234,000) (200,000) (50,000)
Proceeds from issuance of subordinated debt................. -- -- 200,000 200,000 --
Payments of cash dividends.................................. (62,044) (222,533) (93,303) (68,787) (73,631)
Redemption of preferred stock............................... -- -- (135,000) (135,000) --
Repayment of borrowing to support corporate owned life
insurance................................................. (10,638) (95,475) -- -- --
Other, net.................................................. 485 (882) (2,661) 2,642 2,471
---------- --------- ---------- ----------- ----------
Net cash provided by financing activities................. 2,354,844 1,366,040 714,216 1,306,973 797,706
---------- --------- ---------- ----------- ----------
Net increase (decrease) in cash and cash equivalents.......... 203,416 595,851 (675,233) (6,078) (204,092)
Cash and cash equivalents at beginning of period.............. 3,153,713 3,352,423 3,937,697 3,937,697 3,199,455
Effect of exchange rate changes on cash and cash
equivalents................................................. (4,706) (10,577) (63,009) (16,910) (20,819)
---------- --------- ---------- ----------- ----------
Cash and cash equivalents at end of period.................... $3,352,423 $3,937,697 $3,199,455 $3,914,709 $2,974,544
---------- --------- ---------- ----------- ----------
---------- --------- ---------- ----------- ----------
CASH PAID DURING THE PERIOD FOR:
Interest.................................................... $ 739,300 $ 764,327 $ 820,355 $ 611,347 $ 588,487
Income taxes................................................ 91,717 172,451 113,588 47,359 189,411
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING
ACTIVITIES:
Loans transferred to foreclosed assets (OREO)............... $ 48,397 $ 44,557 $ 23,114 $ 19,033 $ 13,882
Securities transferred from held to maturity to available
for sale.................................................. 348,717 -- -- -- --
Dividends declared but unpaid............................... 12,788 20,383 24,528 24,518 24,529
</TABLE>

See accompanying notes to consolidated financial statements.

F-5
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 1995, 1996, 1997,

AND CONDENSED NOTES FOR

SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NATURE OF OPERATIONS

UnionBanCal Corporation (a commercial bank holding company) and subsidiaries
(the Company) is 82 percent owned by The Bank of Tokyo-Mitsubishi, Ltd. (BTM)
and 18 percent owned by other shareholders.

On April 1, 1996, the Company was created by the combination of Union Bank
with BanCal Tri-State Corporation and its banking subsidiary, The Bank of
California, N.A. The combination was accounted for as a reorganization of
entities under common control (similar to a business combination under the
pooling of interests method). Accordingly, all historical financial information
has been restated as if the combination had been in effect for all periods
presented. The merger was effected by the issuance of 54,402,081 shares of Union
Bank common stock in exchange for all the outstanding common shares of BanCal
Tri-State Corporation. Information pertaining to merger and integration expense
is presented in Note 7.

On August 10, 1998, the Company exchanged 10.2 million shares of its common
stock for 7.2 million shares of Union Bank of California, N.A. (the Bank) common
stock owned directly by BTM. This share exchange provided the Company with a 100
percent ownership interest in the Bank. In addition, it increased BTM's
ownership percentage of the Company to 82 percent from 81 percent.

The exchange of shares was accounted for as a reorganization of entities
under common control. Accordingly, amounts previously reported as Parent Direct
Interest in Bank Subsidiary, including the proportionate share of net income,
dividends, and other comprehensive income have been reclassified to combine them
with the corresponding amounts attributable to the Company's common shareholders
for all periods presented.

On November 18, 1998, the Board of Directors approved the declaration of a
3-for-1 stock split effective for shareholders of record on December 7, 1998.
Accordingly, all historical financial information has been restated as if the
stock split had been in effect for all periods presented.

The Company provides a wide range of financial services to consumers, small
businesses, middle market companies and major corporations, primarily in
California, Oregon and Washington, but also nationally and internationally.

BASIS OF FINANCIAL STATEMENT PRESENTATION

The accounting and reporting policies of the Company conform to generally
accepted accounting principles (GAAP) and general practice within the banking
industry. Those policies that materially affect the determination of financial
position, results of operations, and cash flows are summarized below.

The Consolidated Financial Statements include the accounts of the Company.
All material intercompany transactions and balances have been eliminated. The
preparation of financial statements in conformity with GAAP requires management
to make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
Certain amounts for prior periods have been reclassified to conform with current
financial statement presentation.

F-6
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,

AND CONDENSED NOTES FOR

SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NATURE OF OPERATIONS
(CONTINUED)
The unaudited consolidated financial statements of UnionBanCal Corporation
and subsidiaries (the Company) as of September 30, 1997 and 1998 have been
prepared in accordance with generally accepted accounting principles (GAAP) for
interim financial reporting. However, they do not include all of the disclosures
necessary for annual financial statements in conformity with GAAP.

CASH AND CASH EQUIVALENTS

For purposes of reporting cash flows, cash and cash equivalents include cash
and due from banks, interest bearing deposits in banks and federal funds sold
and securities purchased under resale agreements, substantially all of which
have maturities less than 90 days.

TRADING ACCOUNT ASSETS

Trading account assets are those financial instruments that management
acquires with the intent to hold for short periods of time in order to take
advantage of anticipated changes in market values. Substantially all of these
assets are securities with a high degree of liquidity and a readily determinable
market value. Interest earned, paid, or accrued on trading account assets is
included in interest income using a method that generally produces a level
yield. Realized gains and losses from the close out of trading account positions
and unrealized market value adjustments are recognized in noninterest income.

SECURITIES AVAILABLE FOR SALE AND SECURITIES HELD TO MATURITY

The Company's securities portfolios consist of debt and equity securities
that are classified either as securities available for sale or securities held
to maturity.

Debt securities for which the Company has the positive intent and ability to
hold until maturity are classified as securities held to maturity and carried at
amortized cost.

Debt securities and equity securities with readily determinable market
values that are not classified as either held to maturity securities or trading
account assets are classified as securities available for sale and carried at
fair value, with the unrealized gains or losses reported net of taxes as a
separate component of shareholders' equity until realized.

Realized gains and losses arising from the sale of securities are based upon
the specific identification method and included in noninterest income as
securities gains (losses), net.

Interest income on debt securities includes the amortization of premiums and
the accretion of discounts using the effective interest method and is included
in interest income on securities. Dividend income on equity securities is
included in noninterest income.

LOANS

Loans are reported at the principal amounts outstanding, net of unamortized
nonrefundable loan fees and related direct loan origination costs. Deferred net
fees and costs are recognized in interest income

F-7
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,

AND CONDENSED NOTES FOR

SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NATURE OF OPERATIONS
(CONTINUED)
over the loan term using a method that generally produces a level yield on the
unpaid loan balance. Nonrefundable fees and direct loan origination costs
related to loans held for sale are deferred and recognized as a component of the
gain or loss on sale. Interest income is accrued principally on a simple
interest basis.

Nonaccrual loans are those for which management has discontinued accrual of
interest because there exists significant uncertainty as to the full and timely
collection of either principal or interest or such loans have become
contractually past due 90 days with respect to principal or interest.

Interest accruals are continued for certain small business loans that are
processed centrally, consumer loans, credit cards, and one-to-four family
residential real estate loans. These loans are charged off or written down to
their net realizable value based on delinquency time frames that range from 120
to 270 days, depending on the type of credit that has been extended. Interest
accruals are also continued for loans that are both well-secured and in the
process of collection. For this purpose, loans are considered well-secured if
they are collateralized by property having a net realizable value in excess of
the amount of principal and accrued interest outstanding or are guaranteed by a
financially responsible and willing party. Loans are considered "in the process
of collection" if collection is proceeding in due course either through legal
action or other actions that are reasonably expected to result in the prompt
repayment of the debt or in its restoration to current status.

When a loan is placed on nonaccrual, all previously accrued but uncollected
interest is reversed against current period operating results. All subsequent
payments received are first applied to unpaid principal and then to uncollected
interest. Interest income is accrued at such time as the loan is brought fully
current as to both principal and interest, and, in management's judgment, such
loans are considered to be fully collectible. However, Company policy also
allows management to continue the recognition of interest income on certain
loans designated as nonaccrual. This portion of the nonaccrual portfolio is
referred to as "Cash Basis Nonaccrual" loans. This policy only applies to loans
that are well secured and in management's judgment are considered to be fully
collectible. Although the accrual of interest is suspended, any payments
received may be applied to the loan according to its contractual terms and
interest income recognized when cash is received.

Loans are considered impaired when, based on current information, it is
probable that the Company will be unable to collect all amounts due according to
the contractual terms of the loan agreement, including interest payments.
Impaired loans are carried at the lower of the recorded investment in the loan,
the estimated present value of total expected future cash flows, discounted at
the loan's effective rate, or the fair value of the collateral, if the loan is
collateral dependent. Additionally, some impaired loans with commitments of less
than $1 million are aggregated for the purpose of measuring impairment using
historical loss factors as a means of measurement. Excluded from the impairment
analysis are large groups of smaller balance homogeneous loans such as consumer
and residential mortgage loans.

Renegotiated loans are those in which the Company has formally restructured
a significant portion of the loan. The remaining portion is normally charged
off, with a concession either in the form of below market rate financing, or
debt forgiveness on the charged off portion. Loans that have been renegotiated

F-8
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,

AND CONDENSED NOTES FOR

SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NATURE OF OPERATIONS
(CONTINUED)
and have not met specific performance standards for payment are classified as
renegotiated loans within the classification of nonperforming assets. Upon
payment performance, such loans may be transferred from nonperforming status to
accrual status.

The Company offers primarily two types of leases to customers: 1) direct
financing leases where the assets leased are acquired without additional
financing from other sources, and 2) leveraged leases where a substantial
portion of the financing is provided by debt with no recourse to the Company.
Direct financing leases are carried net of unearned income, unamortized
nonrefundable fees and related direct costs associated with the origination or
purchase of leases. Leveraged leases are carried net of nonrecourse debt.

ALLOWANCE FOR CREDIT LOSSES

The Company's allowance for credit losses is maintained at a level
considered by management to be adequate to absorb estimated credit losses and
other credit-related charges. The allowance for credit losses is increased by
the provision for credit losses, which is charged against current period
operating results and decreased by the amount of credit losses, net of
recoveries. Losses are fully or partially charged against the allowance for
credit losses when, in management's judgment, the uncollectible portion of a
loan's principal balance is determined. While management has segmented the
allowance to various credit-related products, the allowance is general in nature
and is available for all extension of credits, including off-balance sheet
instruments.

In evaluating the adequacy of the allowance for credit losses, management
estimates the amount of the potential risk of loss for each loan that has been
identified as having more than standard credit risk. Those estimates give
consideration to general economic conditions and their effects on the borrower's
industry, financial and management abilities and to current valuations of
collateral where appropriate. An estimate for potential credit loss content is
calculated for all loans not so identified based upon the risk characteristics
of particular categories of loans and historical loss experience in the
portfolio, adjusted, as appropriate, for the estimated effects of current
economic conditions. Further consideration for the allocation is based on credit
risk concentrations in the portfolio and commitments and contingent obligations
under off-balance sheet commercial and standby letters of credit. For analytical
purposes only, management attributes portions of the allowance for credit losses
to individual loans or groups of loans. Although the allowance for credit losses
is allocated to various portfolio segments, it is general in nature and is
available for the loan portfolio in its entirety. Although management believes
that the allowance for possible credit losses is adequate, future provisions
will be subject to continuing evaluation of inherent risk in the loan portfolio
and other credit exposures.

A loan is considered impaired when management determines that it is probable
that the Company will be unable to collect all amounts due according to the
original contractual terms of the loan agreement. Impairment is measured by the
difference between the recorded investment in the loan (including accrued
interest, net deferred loan fees or cost and unamortized premium or discount)
and the estimated present value of total expected future cash flows, discounted
at the loan's effective rate, or the fair value of the

F-9
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,

AND CONDENSED NOTES FOR

SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NATURE OF OPERATIONS
(CONTINUED)
collateral, if the loan is collateral dependent. An impairment is recognized by
adjusting an allocation of the existing allowance for credit losses.

PREMISES AND EQUIPMENT

Premises and equipment are carried at cost, less accumulated depreciation
and amortization. Depreciation and amortization are calculated using the
straight-line method over the estimated useful life of each asset. Lives of
premises range from ten to forty years; lives of furniture and equipment range
from three to eight years. Leasehold improvements are amortized over the term of
the respective lease or 10 years, whichever is shorter.

OTHER ASSETS

Goodwill represents the excess of purchase price over the fair value of
identifiable net assets of acquired companies and is reported as intangible
assets. Goodwill is amortized using the straight-line method, generally over 15
years.

Other real estate owned (OREO) represents the collateral acquired through
foreclosure in full or partial satisfaction of the related loan. OREO is
recorded at the lower of the loan's unpaid principal balance or its fair value
as established by a current appraisal, adjusted for disposition costs. Any
write-down at the date of transfer is charged to the allowance for credit
losses. On an ongoing basis, OREO values, recorded in other assets, are reviewed
annually and any decline in value is recognized as foreclosed asset expense in
the current period. The net operating results from these assets are included in
the current period in noninterest expense as foreclosed asset expense (income).

DERIVATIVE INSTRUMENTS HELD FOR TRADING OR CUSTOMER ACCOMMODATION

The Company enters into a variety of interest rate derivative contracts,
primarily swaps and options and foreign exchange contracts, which include spot,
futures, forward, swap and option positions either for trading purposes, based
on management's intent at inception, or as an accommodation to customers.

Derivatives held or issued for trading or customer accommodation are carried
at fair value, with realized and unrealized changes in fair values on contracts
included in noninterest income in the period in which the changes occur.
Unrealized gains and losses are reported gross and included in trading account
assets and other liabilities, respectively. Cash flows are reported net as
operating activities.

DERIVATIVE INSTRUMENTS HELD FOR PURPOSES OTHER THAN TRADING

The Company enters into a variety of derivative contracts as a means of
reducing the Company's interest rate and foreign exchange exposures. At
inception these contracts are evaluated in order to determine if they qualify
for hedge accounting treatment and are accounted for either on a deferral,
accrual or market value basis, depending on the nature of the Company's hedge
strategy and the method used to account for the hedged item. Hedge criteria
include demonstrating the manner in which the hedge

F-10
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,

AND CONDENSED NOTES FOR

SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NATURE OF OPERATIONS
(CONTINUED)
will reduce risk, identifying the specific asset, liability or firm commitment
being hedged, and citing the time horizon being hedged. A monthly evaluation is
performed to ensure that continuing correlation exists between the hedge and the
item being hedged.

Net interest settlements on interest rate swap, cap and floor agreements are
recognized on an accrual basis as interest income or expense of the related
asset or liability over the lives of the agreements. Premiums paid or received
for interest rate caps and floors are amortized either to interest income or to
expense of the related asset or liability over the lives of the agreements. If
an agreement is terminated early, any resulting gain or loss is deferred and
amortized as interest income or expense of the related asset or liability over
the remaining life of the original agreement. Net settlement amounts are
reported gross as other assets and other liabilities. Cash flows are reported
net as operating activities.

FOREIGN CURRENCY TRANSLATION

Assets, liabilities and results of operations for foreign branches are
recorded based on the functional currency of each branch. Since the functional
currency of the branches is the local currency, the net assets are re-measured
into U.S. dollars using a combination of current and historical exchange rates.
The resulting gains or losses are included in shareholders' equity, on a net of
tax basis.

TRANSFERS AND SERVICING OF FINANCIAL ASSETS AND EXTINGUISHMENT OF
LIABILITIES

On January 1, 1997, the Company adopted Statement of Financial Accounting
Standards (SFAS) No. 125, "Accounting for Transfers and Servicing of Financial
Assets and Extinguishments of Liabilities". The Statement establishes standards
for when transfers of financial assets, including those with continuing
involvement by the transferor, should be considered a sale. SFAS No. 125 also
establishes standards for when a liability should be considered extinguished.
This Statement is effective for transfers of assets and extinguishments of
liabilities occurring after December 31, 1996 and has been applied
prospectively. Certain provisions of SFAS No. 125 have been postponed under SFAS
No. 127, "Deferral of the Effective Date of Certain Provisions of FASB Statement
No. 125". SFAS No. 127 deferred for one year the effective date of
implementation for transactions related to repurchase agreements, dollar-roll
repurchase agreements, securities lending and similar transactions. Management
determined that the effect of adoption of SFAS No. 127 on the Company's
financial statements was not material.

INCOME TAXES

The Company files consolidated federal and combined state income tax
returns. Amounts provided for income tax expense are based on income reported
for financial statement purposes and do not necessarily represent amounts
currently payable under tax laws. Deferred taxes, which arise principally from
temporary differences between the period in which certain income and expenses
are recognized for financial accounting purposes and the period in which they
affect taxable income, are included in the amounts provided for income taxes.
Under this method, the computation of the net deferred tax liability or asset
gives current recognition to changes in the tax laws.

F-11
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,

AND CONDENSED NOTES FOR

SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NATURE OF OPERATIONS
(CONTINUED)
NET INCOME PER COMMON SHARE

Basic earnings per share (EPS) is computed by dividing net income after
preferred dividends by the weighted average number of common shares outstanding
during the period. Diluted EPS incorporates the dilutive effect of common stock
equivalents outstanding on an average basis during the period. Stock options
(see Note 12) are a common stock equivalent.

The Company adopted the provisions of SFAS No. 128, "Earnings per Share",
for the year ended December 31, 1997. As required by the provisions of the
Statement, all prior period and interim period EPS data presented have been
restated. This Statement simplifies the standards for computing EPS and makes
them comparable to international EPS standards. SFAS No. 128 replaces the
presentation of primary EPS with a presentation of basic EPS. In addition, all
entities with complex capital structures are required to provide a dual
disclosure of basic and diluted EPS on the face of the income statement and a
reconciliation of the numerator and denominator of the basic EPS computation to
the numerator and denominator of the diluted EPS computation. Also see Note 17.

COMPREHENSIVE INCOME

The Company has retroactively adopted SFAS No. 130, "Reporting Comprehensive
Income", which requires that an enterprise report and display, by major
components and as a single total, the change in its net assets during the period
from non-owner sources. The adoption of this Statement resulted in a change in
the financial statement presentation, but did not have an impact on the
Company's consolidated financial position, results of operations or cash flows.

EMPLOYEE BENEFIT AND INCENTIVE PLANS AND OTHER POSTRETIREMENT BENEFITS

The Company provides a variety of benefit and incentive compensation plans
for eligible employees and retirees. Provisions for the costs of these employee
benefit and incentive plans and postretirement benefit plans are accrued and
charged to expense when the benefit is earned.

STOCK-BASED COMPENSATION

The Company adopted the disclosure provisions of SFAS No. 123, "Accounting
for Stock-Based Compensation", on January 1, 1996. SFAS No. 123 establishes
accounting and disclosure requirements using a fair value-based method of
accounting for stock-based compensation plans.

As allowed under the provisions of SFAS No. 123, the Company has chosen to
continue to recognize compensation expense using the intrinsic value-based
method of valuing stock options prescribed in Accounting Principles Board
Opinion No. 25, "Accounting for Stock Issued to Employees" and related
Interpretations. Under the intrinsic value-based method, compensation cost is
measured as the amount by which the quoted market price of the Company's stock
at the date of grant exceeds the stock option exercise price.

F-12
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,

AND CONDENSED NOTES FOR

SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NATURE OF OPERATIONS
(CONTINUED)
Compensation cost associated with the Company's unvested restricted stock
issued under the management stock plan is measured based on the market price of
the stock at the grant date and is expensed over the vesting period.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In June 1997, the Financial Accounting Standards Board (FASB) issued SFAS
No. 131, "Disclosures about Segments of an Enterprise and Related Information",
which establishes annual and interim reporting standards for an enterprise's
operating segments and related disclosures about its products, services,
geographic areas, and major customers. Adoption of this Statement will not
impact the Company's consolidated financial position, results of operations, or
cash flows, and any effect will be limited to the form and content of its
disclosures. The Statement is effective with the year-end 1998 financial
statements.

In February 1998, the FASB issued SFAS No. 132, "Employers' Disclosures
about Pensions and Other Postretirement Benefits". The Standard revises the
disclosure requirements for pensions and other postretirement benefits. This
Statement is effective for fiscal years beginning after December 15, 1997.
Adoption of this Statement will not impact the consolidated financial position,
results of operations, or cash flows, and any effect is limited to the form and
content of its disclosures.

In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities". The Statement will require the Company to
recognize all derivatives on the balance sheet at fair value. SFAS No. 133
requires that derivative instruments used to hedge be identified specifically to
assets, liabilities, firm commitments or anticipated transactions and measured
as effective and ineffective when hedging changes in fair value or cash flows.
Derivative instruments that do not qualify as either a fair value or cash flow
hedge will be valued at fair value with the resultant gain or loss recognized in
current earnings. Changes in the effective portion of fair value hedges will be
recognized in current earnings along with the change in fair value of the hedged
item. Changes in the effective portion of the fair value of cash flow hedges
will be recognized in other comprehensive income until realization of the cash
flows of the hedged item through current earnings. Any ineffective portion of
hedges will be recognized in current earnings. Management believes that,
depending upon the accumulated net gain or loss of the effective portion of cash
flow hedges at the date of adoption, the impact of SFAS No. 133 could have a
material impact on other comprehensive income. However, Management believes that
any ineffective portion of cash flow hedges or any other hedges will not have a
material impact on the Company's financial position or results of operations.
This Statement is effective for fiscal years beginning after June 15, 1999, with
earlier application encouraged. The Company expects to adopt SFAS No. 133 as of
January 1, 2000.

In October 1998, the FASB issued SFAS No. 134, "Accounting for
Mortgage-Backed Securities Retained after the Securitization of Mortgage Loans
Held for Sale by a Mortgage Banking Enterprise". This Statement amends SFAS No.
65, "Accounting for Certain Mortgage Banking Activities", which established
accounting and reporting standards for certain activities of mortgage banking
and other similar enterprises. After securitization of mortgage loans held for
sale, SFAS No. 134 requires an entity to classify

F-13
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,

AND CONDENSED NOTES FOR

SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND NATURE OF OPERATIONS
(CONTINUED)
the resulting mortgage-backed securities or other retained interests, based on
its ability or intent to sell or hold those investments. Management believes
that the adoption of SFAS No. 134 will have no impact on the Company's financial
position or results of operations. This Statement is effective for fiscal years
beginning after December 15, 1998, with earlier application permitted. The
Company expects to adopt SFAS No. 134 on January 1, 1999.

In March 1998, the American Institute of Certified Public Accountants
(AICPA) issued Statement of Position (SOP) 98-1, "Accounting for the Costs of
Computer Software Developed or Obtained for Internal Use". SOP 98-1 requires the
capitalization of eligible costs of specified activities related to computer
software developed or obtained for internal use. Management believes that the
adoption of SOP 98-1 will not have a material effect on the Company's financial
position or results of operations. The Statement is effective for fiscal years
beginning after December 15, 1998, with earlier adoption encouraged. The Company
expects to adopt SOP 98-1 on January 1, 1999.

In June 1998, the AICPA issued SOP 98-5, "Reporting on the Costs of Start-Up
Activities". SOP 98-5 requires that entities expense start-up costs and
organization costs as they are incurred. Management believes that the adoption
of SOP 98-5 will not have a material effect on the Company's financial position
or results of operations. The Statement is effective for fiscal years beginning
after December 15, 1998, with earlier adoption encouraged. The Company expects
to adopt SOP 98-5 on January 1, 1999.

NOTE 2 -- SECURITIES

The amortized cost, gross unrealized gains, gross unrealized losses, and
fair values of securities are presented below.

SECURITIES AVAILABLE FOR SALE

<TABLE>
<CAPTION>
DECEMBER 31, 1996
----------------------------------------------------
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED
(DOLLARS IN THOUSANDS) COST GAINS LOSSES FAIR VALUE
- ------------------------------------------------------------- ------------ ----------- ----------- ------------
<S> <C> <C> <C> <C>
U.S. Treasury................................................ $ 1,137,992 $ 4,993 $ 1,933 $ 1,141,052
Other U.S. government........................................ 687,717 4,993 779 691,931
Mortgage-backed securities................................... 193,531 400 274 193,657
State and municipal.......................................... 101,006 13,749 -- 114,755
Corporate debt securities.................................... -- -- -- --
Equity securities............................................ 19,041 2,553 -- 21,594
Foreign securities........................................... 1,136 72 -- 1,208
------------ ----------- ----------- ------------
Total securities available for sale...................... $ 2,140,423 $ 26,760 $ 2,986 $ 2,164,197
------------ ----------- ----------- ------------
------------ ----------- ----------- ------------
</TABLE>

F-14
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,

AND CONDENSED NOTES FOR

SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 2 -- SECURITIES (CONTINUED)
<TABLE>
<CAPTION>
DECEMBER 31, 1997
----------------------------------------------------
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED
(DOLLARS IN THOUSANDS) COST GAINS LOSSES FAIR VALUE
- ------------------------------------------------------------- ------------ ----------- ----------- ------------
<S> <C> <C> <C> <C>
U.S. Treasury................................................ $ 987,374 $ 10,793 $ 170 $ 997,997
Other U.S. government........................................ 709,536 6,005 67 715,474
Mortgage-backed securities................................... 679,692 3,331 265 682,758
State and municipal.......................................... 90,937 13,236 -- 104,173
Corporate debt securities.................................... 2,698 311 1 3,008
Equity securities............................................ 28,881 1,596 672 29,805
Foreign securities........................................... 5,132 39 -- 5,171
------------ ----------- ----------- ------------
Total securities available for sale...................... $ 2,504,250 $ 35,311 $ 1,175 $ 2,538,386
------------ ----------- ----------- ------------
------------ ----------- ----------- ------------
</TABLE>

SECURITIES HELD TO MATURITY
<TABLE>
<CAPTION>
DECEMBER 31, 1996
------------------------------------------------
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED
(DOLLARS IN THOUSANDS) COST GAINS LOSSES FAIR VALUE
- ----------------------------------------------------------------- ---------- ----------- ----------- ----------
<S> <C> <C> <C> <C>
U.S. Treasury.................................................... $ 50,109 $ 1,735 $ -- $ 51,844
Other U.S. government............................................ 139,188 4,412 -- 143,600
Mortgage-backed securities....................................... 41,985 2,019 68 43,936
State and municipal.............................................. 36,914 310 2,199 35,025
---------- ----------- ----------- ----------
Total securities held to maturity............................ $ 268,196 $ 8,476 $ 2,267 $ 274,405
---------- ----------- ----------- ----------
---------- ----------- ----------- ----------

DECEMBER 31, 1997
------------------------------------------------
GROSS GROSS
AMORTIZED UNREALIZED UNREALIZED
(DOLLARS IN THOUSANDS) COST GAINS LOSSES FAIR VALUE
- ----------------------------------------------------------------- ---------- ----------- ----------- ----------
<S> <C> <C> <C> <C>
U.S. Treasury.................................................... $ 40,092 $ 1,333 $ -- $ 41,425
Other U.S. government............................................ 99,520 2,568 -- 102,088
Mortgage-backed securities....................................... 24,477 1,745 14 26,208
State and municipal.............................................. 24,686 75 1,367 23,394
---------- ----------- ----------- ----------
Total securities held to maturity............................ $ 188,775 $ 5,721 $ 1,381 $ 193,115
---------- ----------- ----------- ----------
---------- ----------- ----------- ----------
</TABLE>

The amortized cost and fair value of securities, by contractual maturity,
are shown below. Expected maturities may differ from contractual maturities
because borrowers may have the right to call or prepay obligations, with or
without call or prepayment penalties.

F-15
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,

AND CONDENSED NOTES FOR

SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 2 -- SECURITIES (CONTINUED)
MATURITY SCHEDULE OF SECURITIES

<TABLE>
<CAPTION>
SECURITIES SECURITIES
AVAILABLE FOR SALE HELD TO MATURITY
-------------------------- ----------------------
DECEMBER 31, 1997 DECEMBER 31, 1997
-------------------------- ----------------------
AMORTIZED FAIR AMORTIZED FAIR
(DOLLARS IN THOUSANDS) COST VALUE COST VALUE
- ------------------------------------------------------------- ------------ ------------ ---------- ----------
<S> <C> <C> <C> <C>
Due in one year or less...................................... $ 321,459 $ 322,592 $ 22,699 $ 22,801
Due after one year through five years........................ 2,101,347 2,122,154 150,467 156,069
Due after five years through ten years....................... 15,950 18,508 2,596 2,536
Due after ten years.......................................... 36,613 45,327 13,013 11,709
Equity securities............................................ 28,881 29,805 -- --
------------ ------------ ---------- ----------
Total securities........................................... $ 2,504,250 $ 2,538,386 $ 188,775 $ 193,115
------------ ------------ ---------- ----------
------------ ------------ ---------- ----------
</TABLE>

During the quarter ended December 31, 1995, in accordance with guidance
issued by the FASB, the Company reclassified from securities held to maturity to
securities available for sale approximately $285 million at amortized cost of
U.S. Treasury Notes (fair value $285 million) and $64 million at amortized cost
of municipal bonds (fair value $72 million). During the years ended December 31,
1996 and 1997, there were no sales or transfers from the securities held to
maturity portfolio.

In 1995, proceeds from sales of securities available for sale were $241
million with gross realized gains of $2 million and gross realized losses of $3
million. In 1996, proceeds from sales of securities available for sale were $20
million with gross realized gains of $5 million and no gross realized losses. In
1997, proceeds from sales of securities available for sale were $172 million
with gross realized gains of $3 million and no gross realized losses.

F-16
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 3 -- LOANS AND ALLOWANCE FOR CREDIT LOSSES

A summary of loans net of unearned interest and fees of $150 million and
$128 million at December 31, 1996 and 1997, respectively, is as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
----------------------------
(DOLLARS IN THOUSANDS) 1996 1997
- ----------------------------------------------------------------------------------- ------------- -------------
<S> <C> <C>
Domestic:
Commercial, financial and industrial............................................. $ 9,495,592 $ 10,747,179
Construction..................................................................... 357,817 293,333
Mortgage:
Residential.................................................................... 2,960,908 2,961,233
Commercial..................................................................... 2,597,616 2,951,807
------------- -------------
Total mortgage............................................................... 5,558,524 5,913,040
Consumer:
Installment.................................................................... 2,063,434 2,090,752
Home equity.................................................................... 1,113,269 992,916
Credit card and other lines of credit.......................................... 303,235 270,097
------------- -------------
Total consumer............................................................... 3,479,938 3,353,765
Lease financing.................................................................. 800,048 874,860
------------- -------------
Total loans in domestic offices.............................................. 19,691,919 21,182,177
Loans originated in foreign branches............................................... 1,357,868 1,559,231
------------- -------------
Total loans.................................................................. 21,049,787 22,741,408
Allowance for credit losses................................................ 523,946 451,692
------------- -------------
Loans, net................................................................... $ 20,525,841 $ 22,289,716
------------- -------------
------------- -------------
</TABLE>

Changes in the allowance for credit losses were as follows:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
-------------------------------------
(DOLLARS IN THOUSANDS) 1995 1996 1997
- --------------------------------------------------------------------------- ----------- ----------- -----------
<S> <C> <C> <C>
Balance, beginning of year................................................. $ 563,142 $ 555,149 $ 523,946
Loans charged off.......................................................... (133,599) (119,100) (122,779)
Loan loss recoveries....................................................... 72,403 48,024 51,014
----------- ----------- -----------
Total net loans charged off............................................ (61,196) (71,076) (71,765)
Provision for credit losses................................................ 53,250 40,000 --
Transfer of reserve for trading account assets............................. -- -- --
Foreign translation adjustment and other net deductions.................... (47) (127) (489)
----------- ----------- -----------
Balance, end of year....................................................... $ 555,149 $ 523,946 $ 451,692
----------- ----------- -----------
----------- ----------- -----------
</TABLE>

Nonaccrual loans totaled $128 million and $109 million at December 31, 1996
and 1997, respectively. A significant portion of these loans were real estate
related. There were no renegotiated loans at

F-17
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 3 -- LOANS AND ALLOWANCE FOR CREDIT LOSSES (CONTINUED)
December 31, 1996 and 1997. Interest foregone on loans designated as nonaccrual
at December 31, 1995, 1996 and 1997 was $18 million, $9 million and $6 million,
respectively.

LOAN IMPAIRMENT

Impaired loans of the Company include commercial, financial and industrial,
construction and commercial mortgage loans designated as nonaccrual. When the
value of an impaired loan is less than the recorded investment in the loan, a
portion of the Company's allowance for credit losses is allocated as an
impairment allowance.

Effective January 1, 1995, the Company's policy for recognition of interest
income, charge-offs of loans, and application of payments on impaired loans is
the same as the policy applied to nonaccrual loans.

The following table sets forth information about the Company's impaired
loans at the dates indicated.

<TABLE>
<CAPTION>
DECEMBER 31,
----------------------------------
(DOLLARS IN THOUSANDS) 1995 1996 1997
- ----------------------------------------------------------------------------- ---------- ---------- ----------
<S> <C> <C> <C>
Impaired loans with an allowance............................................. $ 58,584 $ 69,886 $ 59,351
Impaired loans without an allowance(1)....................................... 114,611 43,962 49,033
---------- ---------- ----------
Total impaired loans(2).................................................. $ 173,195 $ 113,848 $ 108,384
---------- ---------- ----------
---------- ---------- ----------
Allowance for impaired loans................................................. $ 15,837 $ 21,260 $ 9,418
Average balance of impaired loans during the year............................ $ 277,955 $ 145,351 $ 120,096
</TABLE>

- ------------------------

(1) These loans do not require an allowance for credit losses since the fair
values of the impaired loans equal or exceed the recorded investments in the
loans.

(2) This amount was evaluated for impairment using three measurement methods as
follows: $64 million, $38 million, and $27 million was evaluated using the
present value of the expected future cash flows at December 31, 1995, 1996
and 1997, respectively; $95 million, $45 million, and $53 million was
evaluated using the fair value of the collateral at December 31, 1995, 1996
and 1997, respectively; $14 million, $31 million, and $28 million was
evaluated using historical loss factors at December 31, 1995, 1996 and 1997,
respectively.

Interest income recognized on nonaccrual loans was $11 million, $5 million
and $3 million for the years ended December 31, 1995, 1996 and 1997,
respectively.

RELATED PARTY LOANS

The Company in some cases makes loans to related parties including its
directors, executive officers and their affiliated companies. At December 31,
1996, related party loans outstanding to individuals who served as directors or
executive officers at anytime during the year totaled $79 million as compared to
$38 million at December 31, 1997. In the opinion of management, these related
party loans were made on substantially the same terms, including interest rates
and collateral requirements, as those terms prevailing at the date these loans
were made. During 1996 and 1997, there were no loans to related parties which

F-18
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 3 -- LOANS AND ALLOWANCE FOR CREDIT LOSSES (CONTINUED)
were charged off. Additionally, at December 31, 1996 and 1997, there were no
loans to related parties which were nonperforming.

NOTE 4 -- PREMISES AND EQUIPMENT

Premises and equipment are carried at cost, less accumulated depreciation
and amortization. As of December 31, 1996 and 1997, the amounts were:

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------------------------------------------------------
1996 1997
------------------------------------ ------------------------------------
ACCUMULATED ACCUMULATED
DEPRECIATION DEPRECIATION
AND NET BOOK AND NET BOOK
(DOLLARS IN THOUSANDS) COST AMORTIZATION VALUE COST AMORTIZATION VALUE
- --------------------------------------------------- --------- ------------ ----------- --------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C>
Land............................................... $ 73,309 $ -- $ 73,309 $ 69,290 $ -- $ 69,290
Premises........................................... 264,545 98,785 165,760 253,752 101,997 151,755
Leasehold improvements............................. 124,065 75,264 48,801 135,609 80,019 55,590
Furniture, fixtures and equipment.................. 362,063 239,312 122,751 400,774 271,110 129,664
--------- ------------ ----------- --------- ------------ -----------
Total............................................ $ 823,982 $ 413,361 $ 410,621 $ 859,425 $ 453,126 $ 406,299
--------- ------------ ----------- --------- ------------ -----------
--------- ------------ ----------- --------- ------------ -----------
</TABLE>

Rental, depreciation and amortization expense were as follows:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
-------------------------------
(DOLLARS IN THOUSANDS) 1995 1996 1997
- --------------------------------------------------------------------------------- --------- --------- ---------
<S> <C> <C> <C>
Rental expense of premises....................................................... $ 53,493 $ 66,189 $ 46,556
Less: rental income.............................................................. 11,050 11,904 11,049
--------- --------- ---------
Net rental expense............................................................. $ 42,443 $ 54,285 $ 35,507
--------- --------- ---------
--------- --------- ---------
Other net rental expense (income), primarily for equipment....................... $ 2,705 $ 2,218 $ 298
--------- --------- ---------
--------- --------- ---------
Depreciation and amortization of premises and equipment.......................... $ 49,036 $ 51,821 $ 53,652
--------- --------- ---------
--------- --------- ---------
</TABLE>

F-19
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 4 -- PREMISES AND EQUIPMENT (CONTINUED)
Future minimum operating lease payments are as follows.

<TABLE>
<CAPTION>
(DOLLARS IN THOUSANDS) DECEMBER 31, 1997
- ----------------------------------------------------------------------------------------------- -----------------
<S> <C>
Years ending December 31,
1998......................................................................................... $ 48,156
1999......................................................................................... 46,564
2000......................................................................................... 38,078
2001......................................................................................... 33,793
2002......................................................................................... 23,654
Later years.................................................................................. 127,654
--------
Total minimum operating lease payments......................................................... $ 317,899
--------
--------
Minimum rental income due in the future under noncancellable subleases......................... $ 36,349
--------
--------
</TABLE>

Included in other liabilities in the accompanying December 31, 1997
Consolidated Balance Sheet is $13 million of future operating lease payments
accrued in connection with the Merger (also see Note 7).

A majority of the leases provide for the payment of taxes, maintenance,
insurance and certain other expenses applicable to the leased premises. Many of
the leases contain extension provisions, escalation clauses and purchase
options. There are no restrictions on paying dividends, incurring additional
debt or negotiating additional leases under the terms of the present lease
agreements.

NOTE 5 -- DEPOSITS

At December 31, 1997, the Company had $155 million in domestic interest
bearing time deposits exceeding $100,000 with a remaining term of greater than
one year. Maturity information for those deposits is summarized below.

<TABLE>
<CAPTION>
(DOLLARS IN THOUSANDS) DECEMBER 31, 1997
- ----------------------------------------------------------------------------------------------- -----------------
<S> <C>
Due after one year through two years........................................................... $ 82,707
Due after two years through three years........................................................ 30,064
Due after three years through four years....................................................... 21,854
Due after four years through five years........................................................ 17,642
Due after five years........................................................................... 2,681
--------
Total...................................................................................... $ 154,948
--------
--------
</TABLE>

Substantially all of the foreign interest bearing time deposits exceeding
$100,000 mature in less than one year.

F-20
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 6 -- EMPLOYEE BENEFIT AND INCENTIVE PLANS AND OTHER POSTRETIREMENT BENEFITS

RETIREMENT PLANS

Between April 1, 1996 and December 31, 1996, the Company maintained two
retirement plans, one covering former Union Bank employees and the other
covering former BanCal Tri-State Corporation employees. Effective January 1,
1997, the Union Bank Retirement Plan was amended and renamed the Union Bank of
California, N.A. Retirement Plan (the Plan). In addition, the plan covering
former BanCal Tri-State Corporation employees was terminated and all account
balances became fully vested. Employees of the former BanCal Tri-State
Corporation entered the Plan on January 1, 1997.

The Plan is a noncontributory defined benefit plan that provides retirement
benefits based on years of credited service and the final average compensation
amount, as defined in the Plan. Employees become eligible for this plan after
one year of service and become fully vested after five years of service. Prior
Bank of California participants received credited service from date of hire for
vesting, eligibility and early retirement purposes, but only received service
from January 1, 1997 for benefit purposes. The Company's funding policy is to
make contributions equal to the maximum deductible amount as allowed by the
Internal Revenue Code. Contributions are intended to provide not only for
benefits attributed to services to date, but also for those expected to be
earned in the future. Plan assets are invested in U.S. government securities,
corporate bonds, and commingled investment funds.

The following sets forth the funded status of the Plan and the amounts
recognized in the Company's Consolidated Balance Sheets at December 31, 1996 and
1997.

<TABLE>
<CAPTION>
DECEMBER 31,
------------------------
<S> <C> <C>
(DOLLARS IN THOUSANDS) 1996 1997
- ------------------------------------------------------------------------------ ----------- -----------
Accumulated benefit obligation:
Actuarial present value of benefits for services rendered to date:
Vested.................................................................... $ (241,188) $ (297,646)
Non-vested................................................................ (27,821) (30,858)
----------- -----------
Total................................................................... $ (269,009) $ (328,504)
----------- -----------
----------- -----------
Projected benefit obligation.................................................. $ (323,646) $ (400,958)

Fair value of plan assets..................................................... 381,194 460,501
----------- -----------
Projected benefit obligation less than plan assets.......................... 57,548 59,543
Prior service cost not yet recognized in net periodic pension cost............ 5,165 12,915
Unrecognized net gain due to change of assumptions and experience different
from assumptions made........................................................ (29,660) (37,717)
Unrecognized transition asset at January 1, 1986, being recognized over 13.4
years........................................................................ (359) (210)
----------- -----------
Prepaid pension costs included in other assets.......................... $ 32,694 $ 34,531
----------- -----------
----------- -----------
</TABLE>

F-21
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 6 -- EMPLOYEE BENEFIT AND INCENTIVE PLANS AND OTHER POSTRETIREMENT BENEFITS
(CONTINUED)
The following items are components of net pension expense.

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
----------------------------------
<S> <C> <C> <C>
(DOLLARS IN THOUSANDS) 1995 1996 1997
- -------------------------------------------------------------------- ---------- ---------- ----------
Service cost -- present value of benefits earned.................... $ 10,516 $ 12,651 $ 20,667
Interest cost on projected benefit obligation....................... 19,637 22,043 25,049
Less return on plan assets:
Actual gain....................................................... (63,304) (44,210) (66,819)
Gains in excess of expected return on plan assets................. 42,286 20,333 39,700
---------- ---------- ----------
Expected return on plan assets.................................. (21,018) (23,877) (27,119)
Amortization of prior service cost.................................. 2,108 2,108 3,175
Amortization of transition asset.................................... (149) (149) (149)
---------- ---------- ----------
Net pension expense............................................. $ 11,094 $ 12,776 $ 21,623
---------- ---------- ----------
---------- ---------- ----------
</TABLE>

The following summarizes the assumptions used in computing the present value
of the accumulated benefit obligation, the present value of the projected
benefit obligation and the net pension expense.

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
-------------------------------
<S> <C> <C> <C>
1995 1996 1997
--------- --------- ---------
Discount rate in determining expense.......................................... 7.50% 7.50% 7.50%
Discount rate in determining benefit obligations at year end.................. 7.50 7.50 7.00
Rate of increase in future compensation levels for determining expense........ 5.50 5.50 5.50
Rate of increase in future compensation levels for determining benefit
obligations at year end...................................................... 5.50 5.50 5.00
Expected return on plan assets................................................ 8.25 8.25 8.25
</TABLE>

The former BanCal Tri-State Corporation retirement plan, which was
terminated effective January 1, 1997, was a defined contribution plan. The
Company's expense for pension contributions for the years ended December 31,
1995 and 1996 was $6 million and $5 million, respectively.

EXECUTIVE SUPPLEMENTAL BENEFIT PLANS

The Company has several Executive Supplemental Benefit Plans (ESBP) which
provide eligible employees with supplemental retirement benefits. The plans are
unfunded. The accrued liability for ESBP's included in other liabilities in the
Consolidated Balance Sheets was $35 million at December 31, 1996 and $39 million
at December 31, 1997. The Company's expense relating to the ESBP's was $3
million for the year ended December 31, 1995 and $4 million for each of the
years ended December 31, 1996 and 1997.

F-22
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 6 -- EMPLOYEE BENEFIT AND INCENTIVE PLANS AND OTHER POSTRETIREMENT BENEFITS
(CONTINUED)
SECTION 401(K) SAVINGS PLANS

The Company has a defined contribution plan authorized under Section 401(k)
of the Internal Revenue Code. All benefits-eligible employees with at least one
year of service are eligible to participate in the plan. Employees may
contribute up to 16 percent of their pre-tax covered compensation or up to 10
percent of their after-tax covered compensation through salary deductions. The
Company contributes 50 percent of every pre-tax dollar an employee contributes
up to the first 6 percent of the employee's pre-tax covered compensation.
Effective January 1, 1997, employees are fully vested in the employer's
contributions immediately. In addition, the Company may make a discretionary
annual profit-sharing contribution up to 2.5 percent of an employee's pay. This
profit-sharing contribution is for all eligible employees, regardless of whether
an employee is participating in the 401(k) plan, and depends on the Bank's
annual financial performance. All employer contributions are tax deductible by
the Company. The Company's combined matching contribution expense was $9
million, $9 million and $13 million for the years ended December 31, 1995, 1996
and 1997, respectively.

OTHER POSTRETIREMENT BENEFITS

The Company provides certain health care and life insurance benefits for its
retired employees. The health care cost is shared between the Company and the
retiree. The life insurance plan is noncontributory. The accounting for the
health care plan anticipates future cost-sharing changes to the written plan
that are consistent with the Company's intent to maintain a level of
cost-sharing at approximately 25 percent. Assets set aside to cover such
obligations are primarily invested in mutual funds.

The following table sets forth the plan's combined funded status recognized.

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------
(DOLLARS IN THOUSANDS) 1996 1997
- --------------------------------------------------------------------------- ------------ ------------
<S> <C> <C>
Accumulated postretirement benefit obligation:
Retirees................................................................. $ (48,747) $ (48,519)
Fully eligible plan participants......................................... (11,876) (12,208)
Other active plan participants........................................... (19,651) (18,581)
------------ ------------
Accumulated postretirement obligation.................................. (80,274) (79,308)
Fair value of plan assets.................................................. 21,703 31,136
------------ ------------
Accumulated postretirement obligation in excess of plan assets........... (58,571) (48,172)
Unrecognized net gain due to change in assumption and experience different
from assumptions made..................................................... (14,829) (21,119)
Unrecognized transition obligation......................................... 63,800 59,813
------------ ------------
Accrued postretirement benefit cost.................................... $ (9,600) $ (9,478)
------------ ------------
------------ ------------
</TABLE>

F-23
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 6 -- EMPLOYEE BENEFIT AND INCENTIVE PLANS AND OTHER POSTRETIREMENT BENEFITS
(CONTINUED)
The following table sets forth the components of postretirement benefit
expense.

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
----------------------------------------
(DOLLARS IN THOUSANDS) 1995 1996 1997
- ------------------------------------------------------------ ------------ ------------ ------------
<S> <C> <C> <C>
Service cost................................................ $ 1,792 $ 1,741 $ 3,123
Interest cost............................................... 6,091 5,581 5,150
Actual return on plan assets................................ (3,337) (2,590) (4,445)
Net amortization and deferral............................... 5,559 4,397 4,826
------------ ------------ ------------
Net periodic postretirement benefit cost.................. $ 10,105 $ 9,129 $ 8,654
------------ ------------ ------------
------------ ------------ ------------

Postretirement benefit claims paid for the year............. $ 5,309 $ 3,808 $ 3,787
------------ ------------ ------------
------------ ------------ ------------
</TABLE>

The unrecognized transition obligation recorded on January 1, 1993 is being
amortized over 20 years.

For 1995, the former Union Bank assumed a 9 percent annual rate of increase
in the per capita cost of postretirement medical benefits for the indemnity plan
and a 4 percent annual rate of increase was assumed for the HMO plan. For future
periods the assumed rate for the indemnity plan gradually decreased from 9
percent to 5.5 percent in 2007 and remained level thereafter. The assumed rate
of change on the HMO plan increased for the remainder of the decade, then
gradually decreased to 5.5 percent in the year 2007 and thereafter.

For 1995, former BanCal Tri-State Corporation assumed an 11.5 percent annual
rate of increase in the per capita cost of postretirement medical benefits for
the indemnity plan. For future periods, the assumed rate for the indemnity plan
gradually decreased from 11.5 percent to 5.5 percent in 2003 and remained level
thereafter.

For 1996, the Company assumed a 9 percent annual rate of increase in the per
capita cost of postretirement medical benefits for the indemnity plan and a 4
percent annual rate of increase was assumed for the HMO plan. For future periods
the assumed rate for the indemnity plan gradually decreased from 9 percent to
5.5 percent in 2007 and remained level thereafter. The assumed rate of change on
the HMO plan increased to 7 percent in 1997 and then gradually decreased to 5.5
percent in the year 2007 and thereafter.

For 1997, the Company assumed a 9 percent annual rate of increase in the per
capita cost of postretirement medical benefits for the indemnity plan and a 4
percent annual rate of increase was assumed for the health maintenance
organization (HMO) plan. For future periods, the rate for the indemnity plan was
expected to gradually decrease from 9 percent to 5.5 percent in 2007 and remain
at that level thereafter. The rate for the HMO plan was expected to increase
after one year of being at a low rate and then gradually decrease to 5.5 percent
in the year 2007 and thereafter.

The healthcare cost trend rate assumption has a significant effect on the
amounts reported. To illustrate, increasing the assumed health care cost trend
rates by one percentage point in each year would increase the accumulated
postretirement benefit obligation as of December 31, 1997 by $11 million and the

F-24
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 6 -- EMPLOYEE BENEFIT AND INCENTIVE PLANS AND OTHER POSTRETIREMENT BENEFITS
(CONTINUED)
aggregate of the service and interest cost components of net periodic
postretirement benefit cost for the year then ended by $1 million.

The discount rate used in determining the actuarial present value of the
accumulated postretirement benefit obligation was 7.50% as of December 31, 1995
and 1996 and 7.00% as of December 31, 1997. The estimated rate of return on plan
assets was 8.00% as of December 31, 1995, 1996 and 1997.

NOTE 7 -- OTHER EXPENSES

The detail of other expenses is as follows:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
----------------------------------
(DOLLARS IN THOUSANDS) 1995 1996 1997
- ----------------------------------------------------------------------------- ---------- ---------- ----------
<S> <C> <C> <C>
Merchant transaction processing fees......................................... $ 31,288 $ 37,091 $ 42,274
Communications............................................................... 35,806 40,133 42,372
Professional services........................................................ 26,197 24,342 28,075
Advertising and public relations............................................. 20,911 28,788 28,664
Data processing.............................................................. 18,557 22,140 25,973
Printing and office supplies................................................. 22,626 27,085 24,098
Regulatory assessments....................................................... 23,431 4,048 5,778
Other........................................................................ 117,908 114,400 129,251
---------- ---------- ----------
Total other expenses..................................................... $ 296,724 $ 298,027 $ 326,485
---------- ---------- ----------
---------- ---------- ----------
</TABLE>

In connection with the Merger, the Company incurred merger and integration
expense of $117 million and $6 million for the years ended 1996 and 1997,
respectively, as summarized in the following table.

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER
31,
---------------------
(DOLLARS IN THOUSANDS) 1996 1997
- ------------------------------------------------------------------------------------------- ---------- ---------
<S> <C> <C>
Balance, accrued merger and integration expense, beginning of year......................... $ -- $ 54,344
Provision for merger and integration costs................................................. 117,464 6,037
Utilization:
Cash..................................................................................... 40,155 35,809
Noncash.................................................................................. 22,965 1,642
---------- ---------
Total utilization...................................................................... 63,120 37,451
---------- ---------
Balance, accrued merger and integration expense, end of year............................... $ 54,344 $ 22,930
---------- ---------
---------- ---------
</TABLE>

Total merger and integration expense of $124 million was recorded to cover
$38 million of personnel expense for severance, retention and other employee
related costs, $54 million for facilities expense related

F-25
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 7 -- OTHER EXPENSES (CONTINUED)
to redundant banking facilities, and $32 million in professional services and
other expense. At December 31, 1997, the liability balance included amounts
primarily for severance payments that are being paid on a periodic basis and for
operating lease payments related to redundant banking facilities which are
continuing over the expected term of the leases.

NOTE 8 -- INCOME TAXES

The components of income tax expense were as follows:

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
----------------------------------
(DOLLARS IN THOUSANDS) 1995 1996 1997
- ----------------------------------------------------------------------------- ---------- ---------- ----------
<S> <C> <C> <C>
Taxes currently payable:
Federal.................................................................... $ 96,732 $ 86,159 $ 168,375
State...................................................................... 42,356 23,180 8,441
Foreign.................................................................... 3,430 2,895 2,092
---------- ---------- ----------
Total currently payable.................................................. 142,518 112,234 178,908
---------- ---------- ----------
Taxes deferred:
Federal.................................................................... 34,839 47,575 49,437
State...................................................................... 16,005 3,455 10,499
Foreign.................................................................... (3) (372) (122)
---------- ---------- ----------
Total deferred........................................................... 50,841 50,658 59,814
---------- ---------- ----------
Total income tax expense................................................. $ 193,359 $ 162,892 $ 238,722
---------- ---------- ----------
---------- ---------- ----------
</TABLE>

F-26
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 8 -- INCOME TAXES (CONTINUED)
The components of the net deferred tax balances of the Company were as
follows:

<TABLE>
<CAPTION>
DECEMBER 31,
----------------------
(DOLLARS IN THOUSANDS) 1996 1997
- ------------------------------------------------------------------------------------------ ---------- ----------
<S> <C> <C>
Deferred tax assets:
Allowance for credit losses............................................................. $ 195,128 $ 169,769
Accrued income & expense................................................................ 31,964 21,987
Accrued merger expense.................................................................. 22,051 15,641
Deferred state taxes.................................................................... 13,572 21,063
Other................................................................................... 2,567 7,585
---------- ----------
Total deferred tax assets............................................................. 265,282 236,045
---------- ----------
Deferred tax liabilities:
Leasing................................................................................. 276,922 297,891
Depreciation............................................................................ 13,809 17,192
Unrealized gain on securities available for sale........................................ 9,711 13,536
---------- ----------
Total deferred tax liabilities........................................................ 300,442 328,619
---------- ----------
Net deferred tax liability.......................................................... $ 35,160 $ 92,574
---------- ----------
---------- ----------
</TABLE>

The following table is an analysis of the effective tax rate.

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
-------------------------------------
1995 1996 1997
----- ----- -----
<S> <C> <C> <C>
Federal income tax rate................................................................ 35% 35% 35%
Net tax effects of:
State income taxes, net of federal income tax benefit................................ 5 4 2
Tax-exempt interest income........................................................... (1) (1) (1)
Amortization of intangibles.......................................................... 1 1 1
Other................................................................................ (2) 1 --
-- -- --
Effective tax rate................................................................. 38% 40% 37%
-- -- --
-- -- --
</TABLE>

During 1997, the Company received a refund from the State of California
Franchise Tax Board of approximately $25 million (net of federal taxes of $17
million) in settlement of litigation, administration and audit disputes covering
the years 1975-1987. The refund was recorded as a reduction to state income tax
expense.

During the nine months ended September 30, 1998, a reduction in state income
tax liabilities of $52.4 million, net of federal tax, was recorded. Of the $52.4
million reduction, $29 million related to the reversal of previously accrued
1997 state income tax liabilities and $23.4 million related to a lower tax
provision in 1998. The decrease in the effective tax rate in 1998 resulted from
the Company's ability to file

F-27
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 8 -- INCOME TAXES (CONTINUED)
California franchise tax returns on a worldwide unitary basis, which
incorporates the financial results of BTM and its worldwide affiliates.

Federal and state tax returns for several years are under or subject to
examination by the respective taxing authorities. Although the ultimate outcome
of such examinations cannot be determined at this time, management believes that
the resolution of issues that have been or may be raised will not have a
material adverse effect on the Company's consolidated financial position or
results of operations.

NOTE 9 -- BORROWED FUNDS

The following is a summary of the major categories of borrowed funds.

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------
(DOLLARS IN THOUSANDS) 1996 1997
- -------------------------------------------------------------------------------------- ------------ ------------
<S> <C> <C>
Federal funds purchased and securities sold under repurchase agreements with weighted
average interest rates of 5.09% and 5.38% at December 31, 1996 and 1997,
respectively........................................................................ $ 1,322,654 $ 1,335,884
Commercial paper with weighted average interest rates of 5.34% and 5.64% at December
31, 1996 and 1997, respectively..................................................... 1,495,463 966,575
Other borrowed funds with weighted average interest rates of 5.66% and 6.23% at
December 31, 1996 and 1997, respectively............................................ 749,422 476,010
------------ ------------
Total borrowed funds.............................................................. $ 3,567,539 $ 2,778,469
------------ ------------
------------ ------------

Federal funds purchased and securities sold under repurchase agreements:
Maximum outstanding at any month end................................................ $ 1,322,654 $ 1,575,930
Average balance during the year..................................................... 933,433 1,097,707
Weighted average interest rate during the year...................................... 5.05% 5.33%

Commercial paper:
Maximum outstanding at any month end................................................ $ 1,854,576 $ 1,876,135
Average balance during the year..................................................... 1,620,087 1,637,070
Weighted average interest rate during the year...................................... 5.40% 5.49%

*Other borrowed funds:
Maximum outstanding at any month end................................................ $ 1,697,236 $ 851,694
Average balance during the year..................................................... 1,119,051 635,900
Weighted average interest rate during the year...................................... 5.59% 5.42%
</TABLE>

F-28
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 10 -- SUBORDINATED CAPITAL NOTES AND PREFERRED STOCK

The following is a summary of capital notes which are subordinated to other
obligations of the Company.

<TABLE>
<CAPTION>
DECEMBER 31,
----------------------
(DOLLARS IN THOUSANDS) 1996 1997
- ------------------------------------------------------------------------------------------ ---------- ----------
<S> <C> <C>
Floating rate notes due June 2007. These notes bear interest at 0.325% above 3-month
London Interbank Offered Rate (LIBOR) and are payable to the holder of the note (BTM at
December 31, 1997)...................................................................... $ -- $ 200,000
Floating rate notes due July 2000. These notes bear interest at 0.30% above 3-month
LIBOR................................................................................... 98,000 98,000
Floating rate notes due July 1997 and July 1998. These notes bear interest at 0.25% above
3-month LIBOR and are payable to BTM.................................................... 100,000 50,000
8.00% fixed rate notes due February 2002. The notes were called at par on February 25,
1997.................................................................................... 100,000 --
6.67% fixed rate notes due August 2002. The notes were called at par on August 20, 1997... 50,000 --
Fixed rate and floating rate notes matured in October 1997, with $23,000 bearing interest
at fixed rates of 10.05% to 10.14% and notes totaling $11,000 bearing interest at 0.375%
above 3-month LIBOR..................................................................... 34,000 --
---------- ----------
Total subordinated capital notes...................................................... $ 382,000 $ 348,000
---------- ----------
---------- ----------
</TABLE>

All of the above notes qualify as Tier 2 risk-based capital under the
Federal Reserve guidelines for assessing regulatory capital. For the total
risk-based capital ratio, the amount of notes which qualify as capital is
reduced as the notes approach maturity. At December 31, 1996 and 1997, $219
million and $239 million, respectively, of the notes qualified as risk-based
capital.

Provisions of several of the notes restrict the use of the Company's
property as security for borrowings, and place limitations on leases,
indebtedness, distributions to shareholders, mergers, sales of certain assets,
transactions with affiliates and changes in majority stock ownership of the
Company.

The following table presents the maturities of subordinated capital notes.

<TABLE>
<CAPTION>
(DOLLARS IN THOUSANDS) DECEMBER 31, 1997
- --------------------------------------------------------------------------- -----------------
<S> <C>
Years ending December 31,
1998..................................................................... $ 50,000
2000..................................................................... 98,000
Years after 2002......................................................... 200,000
--------
Total.................................................................. $ 348,000
--------
--------
</TABLE>

At December 31, 1996, the Company had outstanding 1,350,000 shares (or
5,400,000 depositary shares) of 8 3/8% Noncumulative Preferred Stock, Series A
(Preferred Stock) totaling $135 million. On September 3, 1997, the Company
redeemed all 1,350,000 outstanding shares of its Preferred Stock,

F-29
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 10 -- SUBORDINATED CAPITAL NOTES AND PREFERRED STOCK (CONTINUED)
reducing shareholders' equity by $135 million. The redemption price was equal to
the stated value of $100 per share of Preferred Stock (equivalent to $25 per
depositary share), plus $2 million in accrued and unpaid dividends to the
redemption date. The redemption was funded by proceeds from the issuance of $200
million in subordinated capital notes in June 1997.

NOTE 11 -- DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN

The Company has a dividend reinvestment and stock purchase plan for
shareholders. The plan allows shareholders to automatically reinvest all or part
of their dividends in additional shares of the Company's common stock at a cost
of 5 percent below the market price. Participating shareholders also have the
option of purchasing additional shares at full market price with cash payments
of $25 to $3,000 per quarter. The Company obtains shares required for
reinvestment through open market purchases or by the issuance of new shares from
its authorized but unissued stock. During the years ended December 31, 1995,
1996, and 1997, 1,862,034; 155,724; and, 131,127 shares, respectively, were
required for dividend reinvestment purposes, of which 1,862,034; 71,706; and,
3,687 shares were considered new issuances during 1995, 1996 and 1997,
respectively. BTM discontinued its participation in the plan after the quarter
ended March 31, 1995 and did not participate in the plan as of December 31,
1997.

NOTE 12 -- MANAGEMENT STOCK PLAN

The Company has a management stock plan (the Stock Plan) which has 6,600,000
shares of the Company's common stock authorized to be awarded to key employees
and outside directors of the Company and its subsidiaries at the discretion of
the Executive Compensation and Benefits Committee of the Board of Directors (the
Committee). The combined number of shares that are granted under the Stock Plan
cannot exceed 6,600,000 shares of the Company's common stock. Committee members
and employees on rotational assignment from BTM are not eligible for stock
awards.

The Committee determines the term of each stock option grant, up to a
maximum of ten years from the date of grant. The exercise price of the options
issued under the Stock Plan shall not be less than the fair market value on the
date the option is granted. Unvested restricted stock issued under the Stock
Plan is shown as a reduction to retained earnings. The value of the restricted
shares at the date of grant is amortized to compensation expense over its
vesting period. All cancelled or forfeited options and restricted stock become
available for future grants.

In 1995, 1996 and 1997, the Company granted options to various key
employees, including principal officers, under the Stock Plan. The stock options
vest pro rata on each anniversary of the grant date and become fully exercisable
three years from the grant date, provided that the employee has completed the
specified continuous service requirement. They vest earlier if the employee
dies, is permanently and totally disabled, or retires under certain grant, age
and service conditions.

F-30
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 12 -- MANAGEMENT STOCK PLAN (CONTINUED)
The following is a summary of stock option transactions under the Stock
Plan.

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
-------------------------------------------------------------------------------------------
1995 1996 1997
----------------------------- ----------------------------- -----------------------------
NUMBER OF WEIGHTED-AVERAGE NUMBER OF WEIGHTED-AVERAGE NUMBER OF WEIGHTED-AVERAGE
SHARES EXERCISE PRICE SHARES EXERCISE PRICE SHARES EXERCISE PRICE
---------- ----------------- ---------- ----------------- ---------- -----------------
<S> <C> <C> <C> <C> <C> <C>
Options outstanding,
beginning of year... 740,502 $ 9.94 1,082,106 $ 10.42 1,263,807 $ 12.13
Granted............ 389,100 11.25 277,200 18.29 441,900 22.13
Exercised.......... (47,496) 9.83 (80,496) 10.69 (289,029) 10.84
Forfeited.......... -- -- (15,003) -- (19,500) 22.13
---------- ---------- ----------
Options outstanding,
end of year......... 1,082,106 $ 10.42 1,263,807 $ 12.13 1,397,178 $ 15.41
---------- ---------- ----------
---------- ---------- ----------
Options exercisable,
end of year......... 407,466 $ 9.78 686,145 $ 10.38 712,107 $ 11.50
---------- ---------- ----------
---------- ---------- ----------
</TABLE>

The weighted-average fair value of options granted was $3.13 during 1995,
$6.00 during 1996, and $6.94 during 1997.

The following table summarizes information about stock options outstanding.

<TABLE>
<CAPTION>
OPTIONS OUTSTANDING AT DECEMBER 31, 1997 OPTIONS EXERCISABLE AT
------------------------------------------------ DECEMBER 31, 1997
WEIGHTED-AVERAGE ------------------------------
RANGE OF NUMBER REMAINING WEIGHTED-AVERAGE NUMBER WEIGHTED-AVERAGE
EXERCISE PRICES OUTSTANDING CONTRACTUAL LIFE EXERCISE PRICE EXERCISABLE EXERCISE PRICE
- ------------------- ----------- ---------------- ----------------- ----------- -----------------
<S> <C> <C> <C> <C> <C>
$6.66 - 9.08 267,408 5.0 years $ 8.34 267,408 $ 8.34
11.25 - 12.83 456,114 6.2 11.76 348,867 11.92
18.29 251,256 7.7 18.29 83,832 18.29
22.13 422,400 9.1 22.13 12,000 22.13
----------- -----------
1,397,178 712,107
----------- -----------
----------- -----------
</TABLE>

In 1995, 1996 and 1997, the Company also granted 231,210; 133,440; and,
178,320 shares, respectively, of restricted stock to key officers, including
executive officers, under the Stock Plan. The awards of restricted stock vest
pro rata on each anniversary of the grant date and become fully vested four
years from the grant date, provided that the employee has completed the
specified continuous service requirement. They vest earlier if the employee
dies, is permanently and totally disabled, or retires under certain grant, age
and service conditions. Restricted shareholders have the right to vote their
restricted shares and receive dividends.

F-31
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 12 -- MANAGEMENT STOCK PLAN (CONTINUED)
The following is a summary of restricted stock transactions under the Stock
Plan.

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
-------------------------------------------------------------------------------------------
1995 1996 1997
----------------------------- ----------------------------- -----------------------------
WEIGHTED-AVERAGE WEIGHTED-AVERAGE WEIGHTED-AVERAGE
NUMBER OF GRANT DATE NUMBER OF GRANT DATE NUMBER OF GRANT DATE
SHARES FAIR VALUE SHARES FAIR VALUE SHARES FAIR VALUE
---------- ----------------- ---------- ----------------- ---------- -----------------
<S> <C> <C> <C> <C> <C> <C>
Restricted stock
awards outstanding,
beginning of year... 817,608 $ 8.25 1,044,951 $ 8.99 1,166,820 $ 10.04
Granted............ 231,210 11.61 133,440 18.29 178,320 22.18
Cancelled.......... (3,867) 9.72 (11,571) 10.78 (7,923) 20.08
---------- ---------- ----------
Restricted stock
awards outstanding,
end of year......... 1,044,951 $ 8.99 1,166,820 $ 10.04 1,337,217 $ 11.59
---------- ---------- ----------
---------- ---------- ----------
Restricted stock
awards vested, end
of year............. 568,449 $ 7.81 764,670 $ 8.35 942,738 $ 9.17
---------- ---------- ----------
---------- ---------- ----------
</TABLE>

At December 31, 1995, 1996 and 1997, 1,342,449; 958,383; and, 3,365,586
shares, respectively, were available for future grants as either stock options
or restricted stock under the Stock Plan.

The Company follows the intrinsic value based method in accounting for its
employee stock-based compensation plan. Accordingly, no compensation cost has
been recognized for its stock option grants. Had compensation cost for the
Company's stock-based plan been determined based on the fair value at the grant
dates for awards under that plan consistent with the method of SFAS No. 123,
"Accounting for Stock-Based Compensation", the Company's net income and net
income per share would have decreased to the pro forma amounts indicated in the
following table. Options that were granted prior to January 1, 1995 with vesting
periods in 1995 and later are excluded from the pro forma results indicated for
1995 and 1996 in the following table.

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
----------------------------------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA) 1995 1996 1997
- ------------------------------------------------------------------------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Net income............................................... As reported $ 312,942 $ 249,458 $ 411,296
Pro forma 312,691 248,874 410,068
Net income applicable to common stock.................... As reported $ 301,637 $ 238,152 $ 403,696
Pro forma 301,386 237,568 402,468
Net income per common share -- basic..................... As reported $ 1.74 $ 1.37 $ 2.31
Pro forma 1.73 1.36 2.30
Net income per common share -- diluted................... As reported $ 1.73 $ 1.36 $ 2.30
Pro forma 1.73 1.36 2.30
</TABLE>

F-32
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 12 -- MANAGEMENT STOCK PLAN (CONTINUED)
The fair value of each option grant is estimated on the date of grant using
the Black-Scholes option pricing model with the following weighted-average
assumptions used for grants made in the years ended 1995, 1996 and 1997:
risk-free interest rates of 7.1%, 6.3% and 6.6% in the years ended 1995, 1996
and 1997, respectively; expected volatility of 28%, 28% and 26% in the years
ended 1995, 1996 and 1997, respectively; expected lives of 7 years for the years
ended 1995 and 1996, respectively, and 6 years for the year ended 1997; and
expected dividend yields of 4.2%, 2.6% and 2.1% in the years ended 1995, 1996
and 1997.

Effective January 1, 1997, the Company established a Performance Share Plan.
Eligible participants may earn performance share awards to be redeemed in cash
three years after the date of grant. Performance shares are linked to
shareholder value in two ways: (1) the market price of the Company's common
stock, and (2) return on assets, a performance measure closely linked to value
creation. Eligible participants generally receive grants of performance shares
annually. The total number of performance shares granted under the plan cannot
exceed 600,000 and the Company granted 14,400 shares in the year ended 1997. The
value of a performance share is equal to the market price of the Company's
common stock. All cancelled or forfeited performance shares become available for
future grants.

NOTE 13 -- FAIR VALUE OF FINANCIAL INSTRUMENTS

The fair value of a financial instrument is the amount at which the
instrument could be exchanged in a current transaction between willing parties,
other than in a forced or liquidation sale. All of the fair values presented
below have been made under this definition of fair value unless otherwise
disclosed.

It is management's belief that the fair values presented below are
reasonable based on the valuation techniques and data available to the Company
as of December 31, 1996 and 1997, as more fully described below. It should be
noted that the operations of the Company are managed on a going concern basis
and not a liquidation basis. As a result, the ultimate value realized for the
financial instruments presented could be substantially different when actually
recognized over time through the normal course of operations. Additionally, a
substantial portion of an institution's inherent value is its capitalization and
franchise value. Neither of these components have been given consideration in
the presentation of fair values which follow.

F-33
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 13 -- FAIR VALUE OF FINANCIAL INSTRUMENTS (CONTINUED)
The table below presents the carrying value and fair value of the specified
assets and liabilities held by the Company.
<TABLE>
<CAPTION>
DECEMBER 31,
------------------------------------------------------------
<S> <C> <C> <C> <C>
1996 1997
----------------------------- -----------------------------

<CAPTION>
(DOLLARS IN THOUSANDS) CARRYING VALUE FAIR VALUE CARRYING VALUE FAIR VALUE
- --------------------------------------------------- -------------- ------------- -------------- -------------
<S> <C> <C> <C> <C>
ASSETS
Cash and cash equivalents.......................... $ 3,937,697 $ 3,937,697 $ 3,199,455 $ 3,199,455
Trading account assets............................. 465,782 465,782 394,313 394,313
Securities available for sale...................... 2,164,197 2,164,197 2,538,386 2,538,386
Securities held to maturity........................ 268,196 274,405 188,775 193,115
Loans, net of allowance for credit losses.......... 20,525,841 20,803,651 22,289,716 22,511,510

LIABILITIES
Deposits:
Noninterest bearing.............................. 7,655,109 7,655,109 8,849,544 8,849,544
Interest bearing................................. 13,877,851 13,885,504 14,446,830 14,453,029
-------------- ------------- -------------- -------------
Total deposits................................. 21,532,960 21,540,613 23,296,374 23,302,573
Borrowed funds..................................... 3,567,539 3,567,836 2,778,469 2,775,531
Subordinated capital notes......................... 382,000 388,388 348,000 348,000
</TABLE>

The Company is also a party to financial instruments that are not reflected
on the balance sheet but represent obligations of the Company in the normal
course of business. For information regarding the fair value of off-balance
sheet financial instruments, see Note 14.

The following methods and assumptions were used to estimate fair value of
each class of financial instruments for which it is practicable to estimate that
value.

CASH AND CASH EQUIVALENTS: The book value of cash and cash equivalents is
considered a reasonable estimate of fair value.

TRADING ACCOUNT ASSETS: Trading account assets are short term in nature and
valued at market based on quoted market prices or dealer quotes. If a quoted
market price is not available, the recorded amounts are estimated using quoted
market prices for similar securities. Thus, carrying value is considered a
reasonable estimate of fair value for these financial instruments.

SECURITIES: The fair value of securities is based on quoted market prices
or dealer quotes. If a quoted market price is not available, fair value is
estimated using quoted market prices for similar securities. Available for sale
securities are carried at their aggregate fair value, while held to maturity
securities are carried at amortized cost.

LOANS: The fair value for performing fixed and non-reference rate loans was
estimated by discounting the future cash flows using the current rates at which
similar loans would be made to borrowers with similar credit ratings and for
similar remaining maturities and where available, discount rates were based on
current market rates.

F-34
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 13 -- FAIR VALUE OF FINANCIAL INSTRUMENTS (CONTINUED)
The fair value of performing loans tied to the Company's reference rate with
normal credit risk is assumed to approximate their book value. The fair value
for these floating rate loans with increasing credit risk was estimated by
calculating their present value using a yield the Company would currently
require for loans with similar terms to borrowers with similar credit quality.

Loans which are on nonaccrual status were not included in the loan valuation
methods discussed previously. The fair value of these assets was estimated
assuming these loans were sold on a liquidation basis.

The fair value of performing mortgage loans was based on quoted market
prices for loans with similar credit and interest rate risk characteristics.

The fair value of performing credit card loans and credit lines is assumed
to approximate their book value. The fair value was estimated for credit card
loans and credit lines which were past due at December 31, 1996 and 1997 by
segregating them according to their past due status and then discounting them
based on the Company's historical probability of loss.

NONINTEREST BEARING DEPOSITS: The fair value of noninterest bearing
deposits is the amount payable on demand at the reporting date. The fair value
of the demand deposit intangible has not been estimated.

INTEREST BEARING DEPOSITS: The fair value of savings accounts and certain
money market accounts is the amount payable on demand at the reporting date. The
fair value of fixed maturity certificates of deposit was estimated using rates
currently being offered on certificates with similar maturities.

BORROWED FUNDS: The book values of federal funds purchased, securities sold
under repurchase agreements and other short-term borrowings are assumed to
approximate their fair value due to their limited duration characteristics. The
fair value for commercial paper and term federal funds purchased was estimated
using market quotes.

SUBORDINATED CAPITAL NOTES: The fair value of fixed-rate subordinated
capital notes was estimated using discounted cash flows based on market rates
for A-rated bank borrowings. The book values for variable-rate subordinated
capital notes are assumed to approximate fair market value.

NOTE 14 -- DERIVATIVE INSTRUMENTS AND OTHER FINANCIAL INSTRUMENTS WITH
OFF-BALANCE SHEET RISK

The Company is a party to certain derivative and other financial instruments
that are not reflected on the balance sheet but represent obligations or assets
of the Company in the normal course of business. These financial instruments are
used for trading activities of the Company, to meet the needs of customers and
to reduce the impact on the Company's operating results due to market
fluctuations in currency or interest rates.

These financial instruments involve, to varying degrees, elements of credit
and market risk which are not recognized on the balance sheet. Credit risk is
defined as the possibility that a loss may occur from the failure of another
party to perform in accordance with the terms of the contract which exceeds the
value of

F-35
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 14 -- DERIVATIVE INSTRUMENTS AND OTHER FINANCIAL INSTRUMENTS WITH
OFF-BALANCE SHEET RISK (CONTINUED)
the existing collateral, if any. Market risk is the possibility that future
changes in market conditions may make the financial instrument less valuable.

DERIVATIVE INSTRUMENTS

The fair value of the derivative financial instruments was calculated based
on quoted market prices where available or if quoted market prices were not
available, the Company used the estimated amount it would receive or pay to
offset or terminate the agreements based upon the terms of such contracts
relative to prevailing interest rates.

TRADING ACTIVITIES IN DERIVATIVE INSTRUMENTS

The following table reflects the Company's positions relating to trading
activities in derivative instruments. Trading activities include both activities
for the Company's own account and for customers. At December 31, 1996 and 1997,
the majority of the Company's derivative transactions for customers are hedged
with essentially offsetting contracts with other counterparties. The average
fair value of derivatives held or written for trading purposes during the year
is not significant. The notional amount of derivative instruments reflects the
extent of the Company's involvement in these instruments. For interest rate
swap, cap and floor agreements, notional amounts do not represent exposure to
credit or market risk. Notional amounts are not exchanged, but serve as a point
of reference for calculating payments.

F-36
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 14 -- DERIVATIVE INSTRUMENTS AND OTHER FINANCIAL INSTRUMENTS WITH
OFF-BALANCE SHEET RISK (CONTINUED)
The following is a summary of derivative instruments held or written for
trading purposes.
<TABLE>
<CAPTION>
DECEMBER 31,
---------------------------------------------------------
1996 1997
--------------------------------- ----------------------
NOTIONAL CREDIT ESTIMATED NOTIONAL CREDIT
(DOLLARS IN THOUSANDS) AMOUNTS RISK(1) FAIR VALUE AMOUNTS RISK(1)
- -------------------------------------------------------------------- --------- --------- ----------- ----------- ---------
<S> <C> <C> <C> <C> <C>
HELD OR WRITTEN FOR TRADING PURPOSES AND CUSTOMER ACCOMMODATIONS
Foreign exchange forward contracts:
Commitments to purchase........................................... $ 403,602 $ 2,813 $ (11,735) $ 531,330 $ 366
Commitments to sell............................................... 530,923 18,958 14,759 709,512 40,671
Foreign exchange OTC options:
Options purchased................................................. -- -- -- 46,533 --
Options written................................................... -- -- -- 46,533 637
Currency swap agreements:
Commitments to pay................................................ 64,817 4,821 3,193 55,725 --
Commitments to receive............................................ 38,417 1,628 1,595 55,725 5,971
Interest rate contracts:
Caps purchased.................................................... 994,605 1,858 1,837 1,189,791 796
Floors purchased.................................................. 147,250 1,149 1,149 119,000 612
Caps written...................................................... 994,605 21 (1,838) 1,189,791 --
Floors written.................................................... 147,250 -- (1,149) 119,000 --
Swap contracts:
Pay variable/receive variable..................................... 10,000 28 1 58,000 301
Pay fixed/receive variable........................................ 788,165 1,064 (17,592) 976,180 364
Pay variable/receive fixed........................................ 788,165 19,623 18,674 976,180 30,240

ESTIMATED
(DOLLARS IN THOUSANDS) FAIR VALUE
- -------------------------------------------------------------------- -----------
<S> <C>
HELD OR WRITTEN FOR TRADING PURPOSES AND CUSTOMER ACCOMMODATIONS
Foreign exchange forward contracts:
Commitments to purchase........................................... $ (34,304)
Commitments to sell............................................... 40,274
Foreign exchange OTC options:
Options purchased................................................. (634)
Options written................................................... 637
Currency swap agreements:
Commitments to pay................................................ (5,971)
Commitments to receive............................................ 5,971
Interest rate contracts:
Caps purchased.................................................... 796
Floors purchased.................................................. 612
Caps written...................................................... (796)
Floors written.................................................... (612)
Swap contracts:
Pay variable/receive variable..................................... --
Pay fixed/receive variable........................................ (29,579)
Pay variable/receive fixed........................................ 29,926
</TABLE>

- ------------------------------

(1) Credit risk amounts reflect the replacement cost for those contracts in a
gain position in the event of nonperformance by counterparties.

ASSET AND LIABILITY MANAGEMENT DERIVATIVE INSTRUMENTS

Derivative positions are integral components of the Company's designated
asset and liability management activities. Therefore, the Company does not
believe it is meaningful to separately analyze the derivatives component of its
risk management activities in isolation from related positions. The Company uses
interest rate derivative instruments as part of its management of asset and
liability positions. Derivatives are used to manage interest rate risk relating
to specified groups of assets and liabilities, including LIBOR based commercial
loans, deposit liabilities and certain subordinated capital notes. The Company
uses foreign currency forward contracts as a means of managing foreign exchange
rate risk associated with assets or liabilities denominated in foreign
currencies.

The following table reflects summary information on derivative contracts
used to hedge or modify the Company's risk as of December 31, 1996 and 1997.
Amounts included in the fair value column do not include gains or losses from
changes in the value of the underlying asset or liability being hedged. Notional
amounts are not exchanged, but serve as a point of reference for calculating
payments. For interest rate swap, cap and floor agreements, notional amounts do
not represent exposure to credit or market risk.

F-37
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 14 -- DERIVATIVE INSTRUMENTS AND OTHER FINANCIAL INSTRUMENTS WITH
OFF-BALANCE SHEET RISK (CONTINUED)
<TABLE>
<CAPTION>
DECEMBER 31,
------------------------------------------------------------------------------------
1996 1997
------------------------------------------------------ ----------------------------
UNAMORTIZED UNAMORTIZED
NOTIONAL PREMIUM PAID CREDIT ESTIMATED NOTIONAL PREMIUM PAID
(DOLLARS IN THOUSANDS) AMOUNTS (RECEIVED) RISK(1) FAIR VALUE AMOUNTS (RECEIVED)
- ------------------------------------ ----------- --------------- ----------- ----------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C>
HELD FOR ASSET AND LIABILITY
MANAGEMENT PURPOSES
Foreign exchange forward contracts:
Commitments to purchase........... $ 129,264 $ -- $ 1,628 $ (2,286) $ 341,298 $ --
Commitments to sell............... 4,142 -- 52 22 51,754 --
Currency swap agreements:
Commitments to pay................ -- -- -- -- 26,400 --
Interest rate contracts:
Caps purchased.................... 15,740 -- -- -- 15,420 --
Floors purchased.................. 2,050,000 6,309 9,750 9,750 3,550,000 11,730
Caps written...................... 250,000 (709) 509 509 250,000 (335)
Floors written.................... 500,000 (1,016) 391 391 1,850,000 (534)
Swap contracts:
Pay fixed/receive variable........ 114,086 -- 241 (851) -- --
Pay variable/receive fixed........ 847,000 -- 3,775 2,398 575,000 --

CREDIT ESTIMATED
(DOLLARS IN THOUSANDS) RISK(1) FAIR VALUE
- ------------------------------------ ----------- -----------
<S> <C> <C>
HELD FOR ASSET AND LIABILITY
MANAGEMENT PURPOSES
Foreign exchange forward contracts:
Commitments to purchase........... $ 862 $ (5,055)
Commitments to sell............... 35 (822)
Currency swap agreements:
Commitments to pay................ 2,590 2,590
Interest rate contracts:
Caps purchased.................... -- --
Floors purchased.................. 4,040 4,040
Caps written...................... 273 273
Floors written.................... -- (1,309)
Swap contracts:
Pay fixed/receive variable........ -- --
Pay variable/receive fixed........ 2,302 2,302
</TABLE>

- ------------------------------

(1) Credit risk amounts reflect the replacement cost for those contracts in a
gain position in the event of nonperformance by counterparties.

F-38
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 14 -- DERIVATIVE INSTRUMENTS AND OTHER FINANCIAL INSTRUMENTS WITH
OFF-BALANCE SHEET RISK (CONTINUED)

OTHER FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK

Commitments to extend credit are legally binding agreements to lend to a
customer provided there are no violations of any condition established in the
contract. Commitments have fixed expiration dates or other termination clauses
and may require payment of a fee or maintenance of compensatory balances. Such
fees are deferred and, upon partial or full exercise of the commitment,
amortized over the life of the loan or, if exercise is deemed remote, amortized
over the commitment period. Since many of the commitments are expected to expire
without being drawn upon, the contractual amounts do not necessarily represent
future cash requirements. With respect to commitments to extend credit and
letters of credit, the Company's exposure to credit risk in the event of
nonperformance by customers is represented by the contractual amount of those
instruments.

Standby letters of credit are provided to customers to assure their
performance to a third party, generally in the production of goods and services
or under contractual commitments in the financial markets. Commercial letters of
credit are issued to customers to facilitate foreign or domestic trade
transactions. The Company charges fees for the issuance of standby and
commercial letters of credit. The majority of these type of commitments have
terms of one year or less and any fees charged are recognized as noninterest
income upon extension of the commitment. The credit risk involved in issuing
letters of credit is essentially the same as that involved in extending loan
facilities to customers and is represented by the contractual amount of those
instruments. When deemed necessary, the Company holds appropriate collateral
supporting those commitments. Management does not anticipate any material losses
as a result of these transactions.

The Company uses the same credit underwriting policies in granting or
accepting such commitments or contingent obligations as it does for on-balance
sheet instruments, by evaluating customers' credit-worthiness. The amount of
collateral obtained, if deemed necessary by the Company upon extension of
credit, is based on management's evaluation of the customer. The nature of the
collateral varies but may include deposits held in financial institutions,
marketable securities, accounts receivable, inventory, property, equipment and
real estate. The Company also provides for potential losses from either
commitments to extend credit or standby letters of credit as a component of its
evaluation in determination of the adequacy of its allowance for credit losses
and resulting level of provision charged against current period earnings.

The Company's pricing of these financial instruments is based on the credit
quality and other covenants or requirements. Management believes that the
current fees assessed on these off-balance sheet items represent market rates
which would be charged for similar agreements. Based on this belief, the Company
feels that the carrying amounts are reasonable estimates of the fair value of
these financial instruments. At December 31, 1996 and 1997, fair value
represents management's estimate of the

F-39
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 14 -- DERIVATIVE INSTRUMENTS AND OTHER FINANCIAL INSTRUMENTS WITH
OFF-BALANCE SHEET RISK (CONTINUED)
unamortized fee income associated with these instruments. The following is a
summary of other financial instruments with off-balance sheet risk.

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------------------------------
1996 1997
------------------------ ------------------------
CONTRACTUAL FAIR CONTRACTUAL FAIR
(DOLLARS IN THOUSANDS) AMOUNTS VALUE AMOUNTS VALUE
- -------------------------------------------------------------- ------------- --------- ------------- ---------
<S> <C> <C> <C> <C>
Commitments to extend credit.................................. $ 12,500,677 $ 6,185 $ 15,111,062 $ 27,571
Standby letters of credit..................................... 2,610,123 2,808 2,289,878 5,776
Other letters of credit....................................... 336,101 -- 314,594 --
</TABLE>

The Company conducts securities lending transactions for institutional
customers as a fully disclosed agent, and, at times, indemnifies its customers
against counterparty default. All lending transactions are collateralized,
primarily by cash. The amount of securities lent with indemnification was $1,170
million and $1,268 million at December 31, 1996 and 1997, respectively. The
market value of the associated collateral was $1,195 million and $1,294 million
at December 31, 1996 and 1997, respectively.

NOTE 15 -- RESTRICTIONS ON CASH AND DUE FROM BANKS, SECURITIES, LOANS AND
DIVIDENDS

Federal Reserve Board regulations require the Bank to maintain reserve
balances based on the types and amounts of deposits received. Average reserve
balances were approximately $291 million and $339 million for the periods ended
December 31, 1996 and 1997, respectively.

As of December 31, 1996 and 1997, securities carried at $1.7 billion for
each of the periods, and loans of $1.8 billion and $2.7 billion, respectively,
were pledged as collateral for borrowings, to secure public and trust department
deposits, and for repurchase agreements as required by contract or law.

The Federal Reserve Act restricts the extension of credit by the Bank to BTM
and affiliates and to UnionBanCal Corporation and its non-bank subsidiaries and
requires that such loans be secured by certain types of collateral. At December
31, 1997, such extensions of credit were not material.

The payment of dividends by the Bank to UnionBanCal Corporation is subject
to the approval of the Office of the Comptroller of the Currency (OCC) if the
total of all dividends declared in any calendar year exceeds certain calculated
amounts. The payment of dividends is also limited by minimum capital
requirements imposed on national banks by the OCC. At December 31, 1997, the
Bank could have declared dividends aggregating $170 million without prior
regulatory approval.

NOTE 16 -- REGULATORY CAPITAL REQUIREMENTS

The Company and the Bank are subject to various regulatory capital
requirements administered by the federal banking agencies, including minimum
capital requirements. Failure to meet minimum capital requirements can initiate
certain mandatory, and possibly additional discretionary, actions by regulators
that, if undertaken, could have a direct material effect on the Company's
Consolidated Financial Statements. Under capital adequacy guidelines and the
regulatory framework for prompt corrective action, the Company and the Bank must
meet specific capital guidelines that involve quantitative measures of the

F-40
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 16 -- REGULATORY CAPITAL REQUIREMENTS (CONTINUED)
Company's and Bank's assets, liabilities, and certain off-balance sheet items as
calculated under regulatory accounting practices. The Company's and the Bank's
capital amounts and the Bank's prompt corrective action classification are also
subject to qualitative judgments by the regulators about components, risk
weightings and other factors.

Quantitative measures established by regulation to ensure capital adequacy
require the Company and the Bank to maintain minimum amounts and ratios (set
forth in the table below) of total and Tier 1 capital (as defined in the
regulations) to risk-weighted assets (as defined) and of Tier 1 capital (as
defined) to average assets (as defined). Management believes, as of December 31,
1997, that the Company and the Bank meet all capital adequacy requirements to
which they are subject.

As of December 31, 1996, and 1997, the most recent notification from the OCC
categorized the Bank as "well capitalized" under the regulatory framework for
prompt corrective action. To be categorized as "well capitalized", the Bank must
maintain minimum total risk-based, Tier 1 risk-based and Tier 1 leverage ratios
as set forth in the table. There are no conditions or events since that
notification that management believes have changed the Bank's category.

The Company's and the Bank's capital amounts and ratios are presented in the
following tables.

<TABLE>
<CAPTION>
FOR CAPITAL
ACTUAL ADEQUACY PURPOSES
----------------- ------------------------------
(DOLLARS IN THOUSANDS) AMOUNT RATIO AMOUNT RATIO
- ---------------------------------------- ---------- ----- ---------------------------------- ----------------------------
<S> <C> <C> <C> <C>
CAPITAL RATIOS FOR THE COMPANY:
As of December 31, 1996:
Total capital (to risk-weighted
assets)............................. $2,946,654 11.17% greater than/equal to $2,111,223 greater than/equal to 8.0%
Tier 1 capital (to risk-weighted
assets)............................. 2,395,580 9.08 greater than/equal to 1,055,612 greater than/equal to 4.0
Tier 1 capital (to quarterly average
assets)(1).......................... 2,395,580 8.41 greater than/equal to 1,139,855 greater than/equal to 4.0
As of December 31, 1997:
Total capital (to risk-weighted
assets)............................. $3,188,173 11.05% greater than/equal to $2,308,988 greater than/equal to 8.0%
Tier 1 capital (to risk-weighted
assets)............................. 2,587,071 8.96 greater than/equal to 1,154,494 greater than/equal to 4.0
Tier 1 capital (to quarterly average
assets)(1).......................... 2,587,071 8.53 greater than/equal to 1,213,381 greater than/equal to 4.0
</TABLE>

- ------------------------
(1) Excludes certain intangible assets.

F-41
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 16 -- REGULATORY CAPITAL REQUIREMENTS (CONTINUED)
<TABLE>
<CAPTION>
FOR CAPITAL
ACTUAL ADEQUACY PURPOSES
----------------- ---------------------------
(DOLLARS IN THOUSANDS) AMOUNT RATIO AMOUNT RATIO
- ---------------------------------------- ---------- ----- --------------------------------- ------------------------------
<S> <C> <C> <C> <C>
CAPITAL RATIOS FOR THE BANK:
As of December 31, 1996:
Total capital
(to risk-weighted assets)........... $2,746,285 10.51% greater than/equal to $2,090,910 greater than/equal to 8.0%
Tier 1 capital
(to risk-weighted assets)........... 2,208,392 8.45 greater than/equal to 1,045,455 greater than/equal to 4.0
Tier 1 capital
(to quarterly average assets)(1).... 2,208,392 7.76 greater than/equal to 1,138,211 greater than/equal to 4.0
As of December 31, 1997:
Total capital
(to risk-weighted assets)........... $3,025,030 10.58% greater than/equal to $2,286,296 greater than/equal to 8.0%
Tier 1 capital
(to risk-weighted assets)........... 2,527,468 8.84 greater than/equal to 1,143,148 greater than/equal to 4.0
Tier 1 capital
(to quarterly average assets)(1).... 2,527,468 8.35 greater than/equal to 1,210,898 greater than/equal to 4.0

TO BE WELL CAPITALIZED UNDER PROMPT CORRECTIVE ACTION PROVISIONS

----------------------------
(DOLLARS IN THOUSANDS) AMOUNT RATIO

- ---------------------------------------- --------------------------------- ------------------------------

<S> <C> <C>
CAPITAL RATIOS FOR THE BANK:
As of December 31, 1996:
Total capital
(to risk-weighted assets)........... greater than/equal to $2,613,638 greater than/equal to 10.0%

Tier 1 capital
(to risk-weighted assets)........... greater than/equal to 1,568,183 greater than/equal to 6.0

Tier 1 capital
(to quarterly average assets)(1).... greater than/equal to 1,422,764 greater than/equal to 5.0

As of December 31, 1997:
Total capital
(to risk-weighted assets)........... greater than/equal to $2,857,870 greater than/equal to 10.0%

Tier 1 capital
(to risk-weighted assets)........... greater than/equal to 1,714,722 greater than/equal to 6.0

Tier 1 capital
(to quarterly average assets)(1).... greater than/equal to 1,513,622 greater than/equal to 5.0

</TABLE>

- ------------------------
(1) Excludes certain intangible assets.

NOTE 17 -- EARNINGS PER SHARE

Basic EPS is computed by dividing net income after preferred dividends by
the weighted average number of common shares outstanding during the period.
Diluted EPS is computed based on the weighted average number of common shares
outstanding adjusted for common stock equivalents, which include stock options.
The following table presents a reconciliation of basic and diluted EPS for years
ended December 31, 1995, 1996 and 1997 and for the nine months ended September
30, 1997 and 1998 in accordance with SFAS No. 128:

F-42
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 17 -- EARNINGS PER SHARE (CONTINUED)

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
----------------------------------------------------------------------
1995 1996 1997
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE ---------------------- ---------------------- ----------------------
DATA) BASIC DILUTED BASIC DILUTED BASIC DILUTED
- ---------------------------------------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Net Income.............................. $ 312,942 $ 312,942 $ 249,458 $ 249,458 $ 411,296 $ 411,296
Less:
Preferred stock dividends............. (11,305) (11,305) (11,306) (11,306) (7,600) (7,600)
---------- ---------- ---------- ---------- ---------- ----------
Income available to common
shareholders.......................... $ 301,637 $ 301,637 $ 238,152 $ 238,152 $ 403,696 $ 403,696
---------- ---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ---------- ----------
Weighted average common shares
outstanding........................... 173,806 173,806 174,391 174,391 174,683 174,683
Additional shares due to:
Assumed conversion of dilutive stock
options............................. -- 293 -- 393 -- 506
---------- ---------- ---------- ---------- ---------- ----------
Adjusted weighted average common shares
outstanding........................... 173,806 174,099 174,391 174,784 174,683 175,189
---------- ---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ---------- ----------
Net income per share.................... $ 1.74 $ 1.73 $ 1.37 $ 1.36 $ 2.31 $ 2.30
---------- ---------- ---------- ---------- ---------- ----------
---------- ---------- ---------- ---------- ---------- ----------
</TABLE>

<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30,
----------------------------------------------
1997 1998
---------------------- ----------------------
(UNAUDITED) (UNAUDITED)
---------------------- ----------------------
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA) BASIC DILUTED BASIC DILUTED
- ----------------------------------------------------------------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Net Income....................................................... $ 318,851 $ 318,851 $ 352,365 $ 352,365
Less:
Preferred stock dividends...................................... (7,600) (7,600) -- --
---------- ---------- ---------- ----------
Income available to common shareholders.......................... $ 311,251 $ 311,251 $ 352,365 $ 352,365
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Weighted average common shares outstanding....................... 174,615 174,615 175,091 175,091
Additional shares due to:
Assumed conversion of dilutive stock options................... -- 456 -- 638
---------- ---------- ---------- ----------
Adjusted weighted average common shares outstanding.............. 174,615 175,071 175,091 175,729
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Net income per share............................................. $ 1.78 $ 1.78 $ 2.01 $ 2.01
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
</TABLE>

- ------------------------

Options to purchase 277,200 shares of common stock at $18 per share were
outstanding but not included in the computation of diluted EPS in 1996 because
the options were anti-dilutive. Options to purchase 422,400 shares of common
stock at $22 per share and options to purchase 527,550 shares of common stock at
$35 per share were outstanding but not included in the computation of diluted
EPS for the nine months ended September 30, 1997 and 1998, respectively, because
the options were anti-dilutive.

F-43
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 18 -- COMPREHENSIVE INCOME

The following is a summary of the components of accumulated other
comprehensive income:

<TABLE>
<CAPTION>
FOR THE NINE MONTHS
YEARS ENDED DECEMBER 31, ENDED SEPTEMBER 30,
---------------------------------- -----------------------
(DOLLARS IN THOUSANDS) 1995 1996 1997 1997 1998
- ----------------------------------------------------- ---------- ---------- ---------- ----------- ----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Net unrealized gain (loss) on securities available
for sale, net of reclassification adjustment:
Beginning balance.................................. $ (8,838) $ 24,900 $ 14,064 $ 14,064 $ 19,886
Net unrealized gain (loss) on securities
available for sale during the period, before
tax............................................ 53,890 (13,409) 11,908 10,626 41,378
Income tax (expense) benefit....................... (20,586) 5,297 (4,370) (4,229) (15,766)
Less: reclassification adjustment for net realized
(gain) loss on securities available for sale
included in net income during the period, before
tax.............................................. 702 (4,502) (2,711) (2,098) (5,579)
Plus: income tax expense (benefit)................. (268) 1,778 995 857 1,960
---------- ---------- ---------- ----------- ----------
Net activity......................................... 33,738 (10,836) 5,822 5,156 21,993
---------- ---------- ---------- ----------- ----------
Ending balance....................................... 24,900 14,064 19,886 19,220 41,879
---------- ---------- ---------- ----------- ----------
Foreign currency translation adjustments:
Beginning balance.................................. (1,092) (1,240) (3,183) (3,183) (12,458)
Foreign currency translation adjustments during the
period, before tax............................... (239) (3,212) (14,652) (2,785) (153)
Income tax benefit................................. 91 1,269 5,377 1,128 62
---------- ---------- ---------- ----------- ----------
Net activity......................................... (148) (1,943) (9,275) (1,657) (91)
---------- ---------- ---------- ----------- ----------
Ending balance....................................... (1,240) (3,183) (12,458) (4,840) (12,549)
---------- ---------- ---------- ----------- ----------
Other comprehensive income........................... $ 33,590 $ (12,779) $ (3,453) $ 3,499 $ 21,902
---------- ---------- ---------- ----------- ----------
---------- ---------- ---------- ----------- ----------
Accumulated other comprehensive income............... $ 23,660 $ 10,881 $ 7,428 $ 14,380 $ 29,330
---------- ---------- ---------- ----------- ----------
---------- ---------- ---------- ----------- ----------
</TABLE>

NOTE 19 -- CONTINGENCIES

The Company is subject to various pending and threatened legal actions which
arise in the normal course of business. The Company maintains reserves for
losses from legal actions which are both probable and estimable. In the opinion
of management, the disposition of claims currently pending will not have a
material adverse effect on the Company's financial position or results of
operations.

F-44
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 20 -- TRANSACTIONS WITH AFFILIATES

The Company has had, and expects to have in the future, banking transactions
and other transactions in the ordinary course of business with BTM and with its
affiliates and associates. During the years ended December 31, 1995, 1996 and
1997, such transactions included, but were not limited to, origination,
participation, servicing and remarketing of loans and leases, purchase and sale
of acceptances and interest rate derivatives, foreign exchange transactions,
funds transfers, custodianships, electronic data processing, investment advice
and management, deposits and credit examination, and trust services. In the
opinion of management, such transactions were made at prevailing rates, terms
and conditions and do not involve more than the normal risk of collectibility or
present other unfavorable features. In addition, some compensation for services
rendered to the Company is paid to the expatriate officers from BTM, and
reimbursed by the Company to BTM under a services agreement.

NOTE 21 -- CONDENSED UNIONBANCAL CORPORATION UNCONSOLIDATED FINANCIAL STATEMENTS

CONDENSED BALANCE SHEETS

LIABILITIES AND SHAREHOLDERS' EQUITY
Commercial paper.................................................................... $ -- $ --
Subordinated capital notes.......................................................... 100,000 250,000
Other liabilities................................................................... 21,676 25,442
------------ ------------
Total liabilities................................................................. 121,676 275,442
Shareholders' equity................................................................ 2,494,933 2,679,299
------------ ------------
Total liabilities and shareholders' equity........................................ $ 2,616,609 $ 2,954,741
------------ ------------
------------ ------------
</TABLE>

F-45
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 21 -- CONDENSED UNIONBANCAL CORPORATION UNCONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
CONDENSED STATEMENTS OF INCOME

EXPENSE:
Interest expense........................................................... 54,133 22,220 11,174
Other expense, net......................................................... (212) 1,072 1,583
---------- ---------- ----------
Total expense.......................................................... 53,921 23,292 12,757
---------- ---------- ----------
Income before income taxes and equity in undistributed net income of
subsidiaries............................................................... 23,773 273,116 86,160
Income tax expense (benefit)................................................. (694) 889 204
---------- ---------- ----------
Income before equity in undistributed net income of subsidiaries............. 24,467 272,227 85,956
Equity in undistributed net income (loss) of subsidiaries:
Bank subsidiary(1)......................................................... 285,053 (32,894) 314,739
Nonbank subsidiaries....................................................... 3,422 10,125 10,601
---------- ---------- ----------
NET INCOME................................................................... $ 312,942 $ 249,458 $ 411,296
---------- ---------- ----------
---------- ---------- ----------
</TABLE>

- ------------------------

(1) In 1996 the amount represents dividends distributed by the Bank in excess of
its 1996 net income.

F-46
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 21 -- CONDENSED UNIONBANCAL CORPORATION UNCONSOLIDATED FINANCIAL STATEMENTS
(CONTINUED)
CONDENSED STATEMENTS OF CASH FLOWS

CASH FLOWS FROM INVESTING ACTIVITIES:
Advances to subsidiaries.................................................. 33,590 (12,779) (130,805)
Repayment of advances to subsidiaries..................................... 70,000 70,000 76,104
Sales and maturities of securities........................................ 11,650 322 --
---------- ---------- ----------
Net cash provided (used) by investing activities...................... 115,240 57,543 (54,701)

CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase (decrease) in short term borrowings.......................... 366 (632,296) --
Proceeds from reduction of investment in subsidiary equity................ -- 3,966 --
Maturity and redemption of subordinated capital notes and long term
debt.................................................................... (70,000) (70,000) (50,000)
Proceeds from issuance of subordinated capital notes...................... -- -- 200,000
Payments of cash dividends................................................ (62,044) (182,652) (93,303)
Redemption of preferred stock............................................. -- -- (135,000)
Other, net................................................................ 3,392 17,813 9,119
---------- ---------- ----------
Net cash used by financing activities................................. (128,286) (863,169) (69,184)
---------- ---------- ----------
Net increase (decrease) in cash and due from banks........................ 14,221 (537,171) (36,870)
Cash and due from banks at beginning of year.............................. 626,692 640,913 103,742
---------- ---------- ----------
Cash and due from banks at end of year................................ $ 640,913 $ 103,742 $ 66,872
---------- ---------- ----------
---------- ---------- ----------
CASH PAID (RECEIVED) DURING THE YEAR FOR:
Interest.................................................................. $ 52,847 $ 25,785 $ 9,814
Income taxes.............................................................. (2,030) (198) 1,148
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES:
Dividends declared but unpaid............................................. $ 12,788 $ 20,383 $ 24,528
</TABLE>

F-47
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 22 -- SUMMARY OF QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

Certain amounts in the following unaudited quarterly financial information
have been reclassified to conform with current presentation. In the opinion of
management, all adjustments necessary to fairly present the results of
operations have been made.

<TABLE>
<CAPTION>
1996 QUARTERS ENDED
---------------------------------------------------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA) MARCH 31 JUNE 30 SEPTEMBER 30 DECEMBER 31
- ------------------------------------------------------------ ---------- ---------- ------------- ------------
<S> <C> <C> <C> <C>
Interest income............................................. $ 483,068 $ 473,601 $ 481,315 $ 489,320
Interest expense............................................ 187,401 185,362 189,727 196,236
---------- ---------- ------------- ------------
Net interest income......................................... 295,667 288,239 291,588 293,084
Provision for credit losses................................. 10,000 10,000 10,000 10,000
Noninterest income.......................................... 102,874 105,550 107,280 102,972
Noninterest expense......................................... 252,024 313,784 284,075 285,021
---------- ---------- ------------- ------------
Income before income taxes.................................. 136,517 70,005 104,793 101,035
Income tax expense.......................................... 53,251 25,597 42,810 41,234
---------- ---------- ------------- ------------
Net income.................................................. $ 83,266 $ 44,408 $ 61,983 $ 59,801
---------- ---------- ------------- ------------
---------- ---------- ------------- ------------
Net income applicable to common stock....................... $ 80,440 $ 41,582 $ 59,156 $ 56,975
---------- ---------- ------------- ------------
---------- ---------- ------------- ------------
Net income per common share -- basic........................ $ 0.46 $ 0.24 $ 0.34 $ 0.33
---------- ---------- ------------- ------------
---------- ---------- ------------- ------------
Net income per common share -- diluted...................... $ 0.46 $ 0.24 $ 0.34 $ 0.33
---------- ---------- ------------- ------------
---------- ---------- ------------- ------------
Dividends per common share(1)(2)............................ $ 0.12 $ 0.12 $ 0.12 $ 0.12
---------- ---------- ------------- ------------
---------- ---------- ------------- ------------
</TABLE>

F-48
<PAGE>
UNIONBANCAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

DECEMBER 31, 1995, 1996, 1997,
AND CONDENSED NOTES FOR
SEPTEMBER 30, 1997 (UNAUDITED) AND 1998 (UNAUDITED)

NOTE 22 -- SUMMARY OF QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (CONTINUED)
<TABLE>
<CAPTION>
1997 QUARTERS ENDED
---------------------------------------------------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA) MARCH 31 JUNE 30 SEPTEMBER 30 DECEMBER 31
- ------------------------------------------------------------ ---------- ---------- ------------- ------------
<S> <C> <C> <C> <C>
Interest income............................................. $ 485,031 $ 504,663 $ 520,237 $ 523,530
Interest expense............................................ 191,000 197,647 207,983 205,149
---------- ---------- ------------- ------------
Net interest income......................................... 294,031 307,016 312,254 318,381
Provision for credit losses................................. -- -- -- --
Noninterest income.......................................... 114,786 111,021 116,820 120,374
Noninterest expense......................................... 253,138 255,753 253,317 282,457
---------- ---------- ------------- ------------
Income before income taxes.................................. 155,679 162,284 175,757 156,298
Income tax expense.......................................... 63,177 65,739 45,953 63,853
---------- ---------- ------------- ------------
Net income.................................................. $ 92,502 $ 96,545 $ 129,804 $ 92,445
---------- ---------- ------------- ------------
---------- ---------- ------------- ------------
Net income applicable to common stock....................... $ 89,676 $ 93,718 $ 127,857 $ 92,445
---------- ---------- ------------- ------------
---------- ---------- ------------- ------------
Net income per common share -- basic........................ $ 0.51 $ 0.54 $ 0.73 $ 0.53
---------- ---------- ------------- ------------
---------- ---------- ------------- ------------
Net income per common share -- diluted...................... $ 0.51 $ 0.54 $ 0.73 $ 0.53
---------- ---------- ------------- ------------
---------- ---------- ------------- ------------
Dividends per common share(1)............................... $ 0.12 $ 0.12 $ 0.14 $ 0.14
---------- ---------- ------------- ------------
---------- ---------- ------------- ------------
</TABLE>

- ------------------------

(1) Dividends per share for 1996 and 1997 are based on the Company's common
stock outstanding as of the declaration date.

(2) Amounts prior to merger are based on Union Bank only and do not include the
dividend of $145 million paid to The Mitsubishi Bank, Limited in the first
quarter of 1996 by BanCal Tri-State Corporation and The Bank of California,
N.A.

F-49
<PAGE>
INDEPENDENT AUDITORS' REPORT

To the Shareholders and Directors of UnionBanCal Corporation:

We have audited the accompanying consolidated balance sheets of UnionBanCal
Corporation and subsidiaries as of December 31, 1996 and 1997, and the related
consolidated statements of income, changes in shareholders' equity, and cash
flows for each of the three years in the period ended December 31, 1997. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits. The consolidated financial statements give retroactive effect to the
merger of BanCal Tri-State Corporation and Union Bank on April 1, 1996, which
has been accounted for as a pooling of interests as described in Note 1 to the
consolidated financial statements. We did not audit the consolidated statements
of income, changes in shareholders' equity, and cash flows of Union Bank and
subsidiaries for the year ended December 31, 1995, which statements reflect
total net interest income and net income of $832 million and $207 million,
respectively. These statements were audited by other auditors whose report has
been furnished to us, and our opinion expressed herein, insofar as it relates to
the amounts included for Union Bank for 1995, is based solely upon the report of
such other auditors.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits and the report of the other auditors provide a
reasonable basis for our opinion.

In our opinion, based upon our audits and the report of the other auditors, the
consolidated financial statements referred to above present fairly, in all
material respects, the financial position of UnionBanCal Corporation and its
subsidiaries as of December 31, 1996 and 1997, and the results of their
operations and their cash flows for each of the three years in the period ended
December 31, 1997, in conformity with generally accepted accounting principles.

[SIG]

Deloitte & Touche LLP
San Francisco, California
January 30, 1998 (November 18, 1998 as to the exchange of
common shares referred to in Note 1, paragraphs 3 and 4, and
the adoption of SFAS No. 130, "Reporting Comprehensive Income",
referred to in Notes 1 and 18, and December 7, 1998 as to the stock split
referred to in Note 1, paragraph 5.)

F-50
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Shareholders and Board of Directors of Union Bank:

We have audited the consolidated statement of income of Union Bank, a California
state chartered bank and a 71% owned subsidiary of The Bank of Tokyo, Ltd., and
subsidiaries ("the Bank") and the related consolidated statements of
shareholders' equity and cash flows for the year ended December 31, 1995 (not
presented herein). These financial statements are the responsibility of the
Bank's management. Our responsibility is to express an opinion on these
financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the results of operations and cash flows for the year
ended December 31, 1995, of Union Bank and subsidiaries, in conformity with
generally accepted accounting principles.

/s/ ARTHUR ANDERSEN LLP

San Francisco, California
January 24, 1996

F-51
<PAGE>
SUBJECT TO COMPLETION

PRELIMINARY PROSPECTUS DATED JANUARY 29, 1999

THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THESE
SECURITIES MAY NOT BE SOLD UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND THE COMPANY IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE SUCH OFFER OF SALE IS NOT PERMITTED.
<PAGE>
PROSPECTUS
$750,000,000

<TABLE>
<S> <C>
UNIONBANCAL CORPORATION UNIONBANCAL FINANCE TRUST I
UNIONBANCAL FINANCE TRUST II
UNIONBANCAL FINANCE TRUST III
UNIONBANCAL FINANCE TRUST IV

COMMON STOCK, PREFERRED STOCK, DEPOSITARY
SHARES TRUST PREFERRED SECURITIES GUARANTEED BY
AND DEBT SECURITIES UNIONBANCAL CORPORATION
</TABLE>

- --------------------------------------------------------------------------------

UNIONBANCAL CORPORATION

- may sell common stock to the public;

- may sell preferred stock to the public;

- may sell depositary shares representing preferred stock to the public;

- may sell debt securities to the public; and

- will fully and unconditionally guarantee the payment by each trust of any
trust preferred securities based on its combined obligations under a
guarantee, a trust declaration and an indenture.

THE TRUSTS

UnionBanCal Finance Trust I, UnionBanCal Finance Trust II, UnionBanCal
Finance Trust III and UnionBanCal Finance Trust IV may:

- sell trust preferred securities to the public;

- sell trust common securities to UnionBanCal Corporation;

- use the proceeds from these sales to buy an equal amount of debt
securities of UnionBanCal Corporation; and

- distribute the cash payments it receives on the debt securities it owns to
the holders of the trust preferred and trust common securities.

WE URGE YOU TO READ CAREFULLY THIS PROSPECTUS AND THE ACCOMPANYING
PROSPECTUS SUPPLEMENT, WHICH WILL DESCRIBE THE SPECIFIC TERMS OF THE SECURITIES
BEING OFFERED TO YOU, BEFORE YOU MAKE YOUR INVESTMENT DECISION.

INVESTING IN THE SECURITIES INVOLVES RISKS. SEE "RISK FACTORS" BEGINNING ON PAGE
3.

- --------------------------------------------------------------------------------

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS OR THE ACCOMPANYING PROSPECTUS SUPPLEMENT IS TRUTHFUL OR COMPLETE.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
- --------------------------------------------------------------------------------

THIS PROSPECTUS MAY NOT BE USED TO SELL SECURITIES UNLESS ACCOMPANIED BY A
PROSPECTUS SUPPLEMENT.

The date of this prospectus is , 1999
<PAGE>
TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
Risk Factors................................... 3

Forward-Looking Statements..................... 6

UnionBanCal Corporation........................ 7

The Trusts..................................... 8

Use of Proceeds................................ 9

Ratio of Earnings to Combined Fixed Charges and
Preferred Stock Dividends.................... 9

Description of Securities...................... 10
Description of Capital Stock................. 10
Description of Depositary Shares............. 11

Description of the Trust Preferred
Securities................................. 14

Description of Debt Securities............... 21

Description of the Trust Preferred Securities
Guarantees................................. 30

Relationship Among the Trust Preferred
Securities, the Trust Preferred Securities
Guarantee and the Debt Securities Held by
Each Trust................................. 33

Plan of Distribution........................... 34

Legal Opinion.................................. 35

Experts........................................ 35

Where You Can Find More Information............ 36
</TABLE>

2
<PAGE>
RISK FACTORS

YOU SHOULD CAREFULLY CONSIDER THE FOLLOWING RISKS AS WELL AS THE OTHER
INFORMATION CONTAINED OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS BEFORE
PURCHASING THE SECURITIES.

ADVERSE CALIFORNIA ECONOMIC CONDITIONS COULD ADVERSELY AFFECT OUR BUSINESS

A substantial majority of our assets and deposits are generated in
California. As a result, poor economic conditions in California may cause us to
incur losses associated with higher default rates and decreased collateral
values in our loan portfolio. In the early 1990s, the California economy
experienced an economic recession that resulted in increases in the level of
delinquencies and losses for us and many of the state's financial institutions.
If California were to experience another recession, we expect that our level of
problem assets would increase accordingly. The current economic crisis in Asia,
as well as the unstable economic conditions in Latin America, are expected to
continue to negatively impact the economic conditions in California, which could
adversely affect our business.

ADVERSE ECONOMIC FACTORS AFFECTING PARTICULAR INDUSTRIES COULD HAVE AN ADVERSE
EFFECT ON OUR CUSTOMERS AND THEIR ABILITY TO MAKE PAYMENTS TO US

We are also affected by certain industry-specific economic factors. For
example, a portion of our total loan portfolio is related to real estate
obligations, and a portion of our recent growth has been fueled by the general
real estate recovery in California. Accordingly, a downturn in the real estate
industry in California could have an adverse effect on our operations.
Similarly, a portion of our total loan portfolio is to borrowers in the
agricultural industry. Last year's weather effects of "El Nino," combined with
low commodity prices, may adversely affect the agricultural industry and,
consequently, may impact our business negatively.

FLUCTUATIONS IN INTEREST RATES COULD ADVERSELY AFFECT OUR BUSINESS

Significant increases in market interest rates, or the perception that an
increase may occur, could adversely affect both our ability to originate new
loans and our ability to grow. Conversely, a decrease in interest rates could
result in an acceleration in the prepayment of loans. In addition, changes in
market interest rates, or changes in the relationships between short-term and
long-term market interest rates, or changes in the relationships between
different interest rate indices, could affect the interest rates charged on
interest-earning assets differently than the interest rates paid on
interest-bearing liabilities. This difference could result in an increase in
interest expense relative to interest income. An increase in market interest
rates also could adversely affect the ability of our floating-rate borrowers to
meet their higher payment obligations. If this occurred, it could cause an
increase in non-performing assets and net charge-offs, which could adversely
affect our business.

THE BANK OF TOKYO-MITSUBISHI, LTD. CONTROLS SHAREHOLDER VOTES AND ELECTS ALL OF
OUR DIRECTORS

The Bank of Tokyo-Mitsubishi owns a majority of the outstanding shares of
our common stock. As a result, The Bank of Tokyo-Mitsubishi can elect all of our
directors and effectively can control the vote on all matters, including
determinations such as:

- approval of mergers or other business combinations;

- sales of all or substantially all of our assets;

- any matters submitted to a vote of our shareholders;

- issuance of any additional common stock or other equity securities;

- incurrence of debt other than in the ordinary course of business;

3
<PAGE>

- the selection and tenure of our Chief Executive Officer;

- payment of dividends on common stock or other equity securities; and

- matters that might be favorable to The Bank of Tokyo-Mitsubishi.

The Bank of Tokyo-Mitsubishi's ability to prevent an unsolicited bid for
UnionBanCal Corporation or any other change in control could have an adverse
effect on the market price for our common stock and our other securities. A
majority of UnionBanCal Corporation's directors are not officers or employees of
UnionBanCal Corporation or any of its affiliates, including The Bank of
Tokyo-Mitsubishi. However, because of The Bank of Tokyo-Mitsubishi's control
over the election of our directors, The Bank of Tokyo-Mitsubishi could change
the composition of our Board of Directors so that it would not have a majority
of outside directors.

THE BANK OF TOKYO-MITSUBISHI LTD.'S FINANCIAL CONDITION COULD ADVERSELY AFFECT
OUR OPERATIONS

Although we fund our operations independently of The Bank of
Tokyo-Mitsubishi and believe our business is not necessarily closely related to
its business or outlook, its credit ratings may affect our credit ratings. The
Bank of Tokyo-Mitsubishi's credit ratings were downgraded in October 1998 by
Standard and Poor's Corporation and in January 1999 by Moody's Investors
Service, Inc. Any future downgrading of its credit rating could adversely affect
our credit ratings. Therefore, as long as The Bank of Tokyo-Mitsubishi maintains
a majority interest in UnionBanCal Corporation, a deterioration in The Bank of
Tokyo-Mitsubishi's financial condition could result in an increase in our
borrowing costs and could impair our access to the public and private capital
markets. The Bank of Tokyo-Mitsubishi is also governed by regulatory oversight
and review. Our business operations and expansion plans could be negatively
affected by regulatory concerns related to the Japanese financial system and The
Bank of Tokyo-Mitsubishi.

POTENTIAL CONFLICTS OF INTEREST WITH THE BANK OF TOKYO-MITSUBISHI, LTD. COULD
ADVERSELY AFFECT US

As part of The Bank of Tokyo-Mitsubishi's normal risk management processes,
it manages its global credit risks and concentrations on an aggregate basis,
including UnionBanCal Corporation. Therefore, at some levels, our ability to
approve specified credits and categories of customers is dependent upon
concurrence by The Bank of Tokyo-Mitsubishi. We may wish to extend credit to the
same customer as The Bank of Tokyo-Mitsubishi. Our ability to do so may be
limited for various reasons, including The Bank of Tokyo-Mitsubishi's aggregate
credit risk and marketing policies.

Our directors' and officers' ownership interests in The Bank of
Tokyo-Mitsubishi's common stock or service as a director or officer or other
employee of both UnionBanCal Corporation and The Bank of Tokyo-Mitsubishi could
create or appear to create potential conflicts of interest, especially since
both of us compete in the United States banking industry.

SUBSTANTIAL COMPETITION IN THE CALIFORNIA BANKING MARKET COULD ADVERSELY AFFECT
US

Banking is a highly competitive business. We compete actively for loan,
deposit, and other financial services business in California, as well as
nationally and internationally. Our competitors include a large number of state
and national banks, thrift institutions and major foreign-affiliated or foreign
banks, as well as many financial and nonfinancial firms that offer services
similar to those offered by us. Some of our competitors are community banks that
have strong local market positions. Other competitors include large financial
institutions, such as Bank of America, California Federal, Washington Mutual,
and Wells Fargo, that have substantial capital, technology and marketing
resources. Such large financial institutions may have greater access to capital
at a lower cost than we do, which may adversely affect our ability to compete
effectively.

In addition, there have been a number of recent mergers involving financial
institutions located in California. Some of the merged banks, such as Wells
Fargo after its merger with Norwest, employ a strong

4
<PAGE>
community-based banking model of doing business that may increase competition
with our distinctive combination of traditional community bank service coupled
with a large branch network.

STATUTORY RESTRICTIONS ON SUBSIDIARY DIVIDENDS AND OTHER DISTRIBUTIONS AND DEBTS
OF OUR SUBSIDIARIES COULD LIMIT AMOUNTS OUR SUBSIDIARIES MAY PAY TO US

A substantial portion of our cash flow typically comes from dividends that
our bank and nonbank subsidiaries pay to us. Various statutory provisions
restrict the amount of dividends our subsidiaries can pay to us without
regulatory approval. In addition, if any of our subsidiaries liquidates, that
subsidiary's creditors will be entitled to receive distributions from the assets
of that subsidiary to satisfy their claims against it before we, as a holder of
an equity interest in the subsidiary, will be entitled to receive any of the
assets of the subsidiary. If, however, we are a creditor of the subsidiary with
recognized claims against it, we would be in the same position as other
creditors.

ADVERSE EFFECTS OF BANKING REGULATIONS OR CHANGES IN BANKING REGULATIONS COULD
ADVERSELY AFFECT US

We are governed by significant federal and state regulation and supervision,
which is primarily for the benefit and protection of our customers and not for
the benefit of our investors. In the past, our business has been materially
affected by these regulations. This trend is likely to continue in the future.
Laws, regulations or policies currently affecting us and our subsidiaries may
change at any time. Regulatory authorities may also change their interpretation
of these statutes and regulations. Therefore, our business may be adversely
affected by any future changes in laws, regulations, policies or
interpretations.

Additionally, our international activities may be regulated by the laws and
regulations of the jurisdiction where business is being conducted. International
laws, regulations and policies affecting us and our subsidiaries may change at
any time and affect our business opportunities and competitiveness in these
jurisdictions. Due to The Bank of Tokyo-Mitsubishi's controlling ownership of
UnionBanCal Corporation, laws, regulations and policies adopted or enforced by
the Government of Japan may adversely affect our activities and investments and
those of our subsidiaries in the future.

Under long-standing policy of the Board of Governors of the Federal Reserve
System, a bank holding company is expected to act as a source of financial
strength for its subsidiary banks. As a result of that policy, we may be
required to commit financial and other resources to our subsidiary bank in
circumstances where we might not otherwise do so.

POSSIBLE DISRUPTION OF BUSINESS DUE TO THE YEAR 2000 PROBLEM

The year 2000 problem results from an inability of computer systems to
accurately recognize dates on and after the year 2000. The year 2000 problem is
a broad business issue that extends beyond computer failures to possible
failures of entire infrastructures, such as telecommunications and data
networks, building facilities and security systems and systems of other
institutions, including governmental agencies, to settle transactions.

Many of our critical operations are not presently ready to operate normally
in the year 2000 and beyond, although preparations are underway to correct this.
We are preparing for the century change with an enterprise-wide year 2000
program. As part of the program, we have identified all of the major application
and processing systems and have sought external and internal resources to
replace and test the systems. We are testing purchased software, internally
developed systems and systems supported by external parties as part of the
program. We are evaluating customers and vendors that have significant
relationships with us to determine whether they are adequately preparing for the
year 2000. In addition, we are developing contingency plans to reduce the impact
of some potential events that may occur. However, we cannot guarantee that the
systems of vendors or customers with whom we do business will be year 2000
compliant on a timely basis, or that contingency plans will shield operations
from failures that may occur.

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<PAGE>
The year 2000 problem poses the following principal risks to our business:

- disruption of our business due to our failure to achieve year 2000
readiness;

- disruption of our business due to failure of third parties to achieve year
2000 readiness; and

- disruption in our funding and repayment operations due to failure of fund
providers and obligors to achieve year 2000 readiness.

We estimate that the total cost of the year 2000 project will be
approximately $50 million. We are funding the cost of the year 2000 project by
normal operating cash flow. We are staffing our year 2000 project with external
people as well as internal staff re-deployed from less time-sensitive
assignments. Our estimated total cost could change further as analysis
continues. Because of the range of possible issues and the large number of
variables involved, however, we cannot definitively quantify the potential
costs. For example, our remediation efforts or the efforts of third parties may
be unsuccessful. Any failure of such remediation efforts could result in a loss
of business, damage to our reputation or legal liability. Consequently, such
failures could have a material adverse effect on our business.

POSSIBLE FUTURE SALES OF SHARES BY THE BANK OF TOKYO-MITSUBISHI, LTD. COULD
ADVERSELY AFFECT THE MARKET PRICE OF OUR COMMON STOCK

Although The Bank of Tokyo-Mitsubishi has announced its intention to
maintain its majority ownership in UnionBanCal Corporation, it may sell shares
of our common stock in compliance with the federal securities laws. By virtue of
its current control of UnionBanCal Corporation, The Bank of Tokyo-Mitsubishi
could sell large amounts of its shares of our common stock by causing us to file
a registration statement that would allow them to sell shares more easily. In
addition, The Bank of Tokyo-Mitsubishi could sell its shares of our common stock
without registration under Rule 144 of the Securities Act. Although we can make
no prediction as to the effect, if any, that such sales would have on the market
price of our common stock, sales of substantial amounts of our common stock, or
the perception that such sales could occur, could adversely affect market
prices. If The Bank of Tokyo-Mitsubishi sells or transfers its shares of our
common stock as a block, another person or entity could become the controlling
shareholder of UnionBanCal Corporation.

FORWARD-LOOKING STATEMENTS

This prospectus and the information incorporated by reference includes
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, and Section 21E of the Securities Exchange Act. Some of the
forward-looking statements can be identified by the use of forward-looking words
such as "believes," "expects," "may," "will," "should," "seeks,"
"approximately," "intends," "plans," "estimates," or "anticipates" or the
negative of those words or other comparable terminology. Forward-looking
statements involve inherent risks and uncertainties. A number of important
factors could cause actual results to differ materially from those in the
forward-looking statements. Some factors include fluctuations in interest rates,
inflation, government regulations, and economic conditions and competition in
the geographic and business areas in which we conduct our operations. For a
discussion of factors that could cause actual results to differ, please see the
discussion under "Risk Factors" contained in this prospectus generally, in any
prospectus supplement related hereto, and in other information contained in our
publicly available SEC filings.

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<PAGE>

UNIONBANCAL CORPORATION

We are a California-based bank holding company. Our principal subsidiary is
Union Bank of California, N.A. Union Bank of California is:

- the third largest commercial bank in California, based on both total
assets and total deposits in California,

- one of the 30 largest banks in the United States, and

- one of the oldest banks on the West Coast.

At September 30, 1998, we had:

- 244 full-service branches in California,

- 6 full-service branches in Oregon and Washington,

- 2 facilities in Texas and New York, and

- 18 offices abroad.

Our bank was formed through the combination of Union Bank and BanCal
Tri-State Corporation in 1996. We are presently approximately 82% owned by The
Bank of Tokyo-Mitsubishi.

We provide a wide range of financial products and services to retail
customers, small businesses, middle-market companies and large corporations.

Most of our customers are located in California, the nation's most populous
state with over 32 million residents.

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<PAGE>
THE TRUSTS

We created four Delaware business trusts by executing, as sponsor, four
Declarations of Trust with five appointed trustees for each trust. The trusts
are named UnionBanCal Finance Trust I, UnionBanCal Finance Trust II, UnionBanCal
Finance Trust III, and UnionBanCal Finance Trust IV (each, a "Trust"). Prior to
the issuance of trust preferred securities, we will file an Amended and Restated
Declaration of Trust for the Trust that will issue the trust preferred
securities. The trust declaration will state the terms and conditions for the
Trust to issue and sell its preferred securities and its common securities. A
form of trust declaration is filed as an exhibit to the registration statement
of which this prospectus is a part.

Each Trust will exist solely to:

- issue and sell its trust preferred and trust common securities;

- use the proceeds from the sale of its trust preferred and trust common
securities to purchase a series of our debt securities; and

- engage in other activities that are necessary or incidental to these
purposes.

We will purchase all of the trust common securities of each Trust. Unless
otherwise stated in the applicable prospectus supplement, the trust common
securities will represent an aggregate liquidation amount equal to at least 3%
of each Trust's total capitalization. The trust preferred securities will
represent the remaining approximately 97% of such Trust's total capitalization.
The trust common securities will have terms substantially identical to, and will
rank equal in priority of payment with, the trust preferred securities. However,
if an event of default under the related trust declaration has occurred, then
cash distributions and liquidation, redemption and other amounts payable on the
trust common securities will rank lower in priority of payment than the trust
preferred securities.

We will guarantee the trust preferred securities as described later in this
prospectus and the applicable prospectus supplement.

We have appointed five trustees to conduct the Trusts' business and affairs:

- The First National Bank of Chicago as the property trustee;

- First Chicago Delaware Inc. as the Delaware trustee; and

- Three officers of UnionBanCal Corporation as the regular trustees.

Only UnionBanCal Corporation, as the only holder of the trust common
securities of each Trust, can remove or replace the trustees. In addition, we
can increase or decrease the number of trustees. The majority of trustees,
however, will always be regular trustees.

We will pay all fees and expenses related to each Trust and to each offering
of the related preferred securities, except each Trust will pay for its
obligations under the related trust preferred and trust common securities.

The Trusts will not have separate financial statements. The statements would
not be material to holders of the preferred securities because the Trusts will
not have any independent operations. The Trusts exist solely for the reasons
stated above.

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USE OF PROCEEDS

The net proceeds of the sale of the trust common and trust preferred
securities issued by each Trust will be invested by the applicable Trust in the
related series of our debt securities. Unless otherwise stated in the applicable
prospectus supplement, we intend to use those proceeds, in addition to the net
proceeds of any securities sold by us, for possible repurchases of our
outstanding securities and for general corporate purposes, including working
capital, acquisitions and other business opportunities.

RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND
PREFERRED STOCK DIVIDENDS

The following table presents the ratio of earnings to combined fixed charges
and preferred stock dividends for UnionBanCal Corporation for the periods
indicated.

<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEARS ENDED DECEMBER 31, SEPTEMBER 30,
----------------------------------------------------- --------------------
1993 1994 1995 1996 1997 1997 1998
--------- --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of earnings to combined fixed charges and
preferred stock dividends:
Excluding interest on deposits.................. 1.33x 1.46x 1.68x 1.51x 1.78x 1.79x 1.85x
Including interest on deposits.................. 1.20 1.29 1.42 1.30 1.45 1.46 1.49
</TABLE>

For purposes of computing these ratios, earnings represent consolidated
income before income taxes and cumulative effects of accounting changes plus
consolidated fixed charges. Combined fixed charges represent interest expense,
including interest on deposits where indicated, and such portion of rental
expense deemed representative of the interest factor. The denominator is
increased for preferred stock dividend requirements which represent the amount
of pre-tax earnings required to cover such dividend requirements.

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<PAGE>
DESCRIPTION OF SECURITIES

This prospectus contains a summary of our common stock, preferred stock,
depositary shares, debt securities, preferred securities of the Trusts, and
preferred securities guarantees of UnionBanCal Corporation relating to each
Trust. The securities issued by the Trusts will be identical to each individual
Trust, except as otherwise described in the prospectus supplement for such
securities. These summaries are not meant to be a complete description of each
security. However, this prospectus and the accompanying prospectus supplement
contain the material terms and conditions for each security.

DESCRIPTION OF CAPITAL STOCK

The following descriptions of our capital stock are not complete. You should
also read our Amended and Restated Articles of Incorporation, our ByLaws and the
California General Corporation Law ("CGCL"). We have filed copies of the
Articles of Incorporation and the Bylaws with the SEC. These documents are
incorporated by reference into the registration statement of which this
prospectus is a part.

We have 305,000,000 shares of capital stock authorized, of which 300,000,000
shares are common stock and 5,000,000 shares are preferred stock. As of December
31, 1998, we had shares of common stock issued and outstanding, and no
shares of our preferred stock were issued or outstanding.

COMMON STOCK

Each holder of shares of our common stock is entitled to one vote for each
share held on all matters to be voted upon by our shareholders. The holders of
outstanding shares of our common stock are entitled to receive ratably such
dividends out of assets legally available therefor as our Board of Directors may
determine. Upon our liquidation or dissolution, the holders of our common stock
will be entitled to share ratably in our assets that are legally available for
distribution to shareholders after payment of liabilities. If we have any
preferred stock outstanding, holders of the preferred stock may be entitled to
dividend and/or liquidation preferences. In either such case, we must pay the
applicable distribution to the holders of our preferred stock before we may pay
them to the holders of our common stock. Holders of our common stock have no
conversion, sinking fund, redemption, preemptive or subscription rights. In
addition, holders of our common stock do not have cumulative voting rights. We
cannot further call or assess shares of our common stock.

PREFERRED STOCK

We are authorized to issue 5,000,000 shares of preferred stock, none of
which currently is issued or outstanding. Our Board has the authority to
determine and alter the rights, preferences, privileges and restrictions granted
to or imposed upon any wholly unissued series of our preferred stock and to fix
the number of shares, dividend rights, conversion or exchange rights, voting
rights, redemption rights, liquidation preferences, and sinking funds of any
series of our preferred stock. The authorized shares of our preferred stock will
be available for issuance without further action by our shareholders, unless
shareholder action is required by applicable law or by the rules of a stock
exchange on which any series of our stock may be listed. The holders of our
preferred stock will have the right to vote separately as a class on any
proposal involving fundamental changes in the rights of those holders as
provided by the CGCL.

This authority of our Board of Directors gives it the power to approve the
issuance of a series of preferred stock that could, depending on its terms,
either impede or facilitate the completion of a merger, tender offer or other
takeover attempt. For example, the issuance of new shares might impede a
business combination if the terms of those shares include voting rights that
would enable a holder to block business combinations. Conversely, the issuance
of new shares might facilitate a business combination if those shares have
general voting rights sufficient to satisfy an applicable percentage vote
requirement.

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<PAGE>

If applicable, the terms on which our preferred stock may be convertible
into or exchangeable for our common stock or our other securities will be
described in the applicable Certificate of Determination and prospectus
supplement. The terms will include provisions as to whether conversion or
exchange is mandatory, at the option of the holder, or at our option, and may
include provisions that adjust the number of shares of our common stock or other
securities of ours that the holders of our preferred stock may receive.

WRITTEN CONSENTS

Our Bylaws provide that any shareholder action can be taken by written
consent of the shareholders. As a result, The Bank of Tokyo-Mitsubishi, which
owns a majority of shares of our common stock, can take action by written
consent.

DIRECTORS' LIABILITY

Our Articles of Incorporation provide for indemnification of directors to
the fullest extent authorized by California law. Section 317 of the CGCL
contains provisions permitting, and in some situations, requiring California
corporations to provide indemnification to their directors and officers for
losses and litigation expenses incurred in connection with their service to the
corporation in those capacities.

TRANSFER AGENT AND REGISTRAR

Harris Trust Company of California acts as transfer agent and registrar for
our common stock.

DESCRIPTION OF DEPOSITARY SHARES

The following description of the depositary shares is not complete. You
should also read the Deposit Agreement relating to the depositary shares and the
depositary receipt relating to the preferred stock that is attached to the
Deposit Agreement. We have filed those documents with the SEC as an exhibit to
the registration statement of which this prospectus is a part.

GENERAL

If we elect to offer fractional interests in shares of preferred stock, we
will provide for the issuance by a depositary to the public of receipts for
depositary shares. Each depositary share will represent fractional interests of
preferred stock. We will deposit the shares of preferred stock underlying the
depositary shares under a Deposit Agreement between us and a bank or trust
company selected by us. The bank or trust company must have its principal office
in the United States and a combined capital and surplus of at least $50 million.
The depositary receipts will evidence the depositary shares issued under the
Deposit Agreement.

The Deposit Agreement will contain terms applicable to the holders of
depositary shares in addition to the terms stated in the depositary receipts.
Each owner of depositary shares will be entitled to all the rights and
preferences of the preferred stock underlying the depositary shares in
proportion to the applicable fractional interest in the underlying shares of
preferred stock. The depositary will issue the depositary receipts to
individuals purchasing the fractional interests in shares of the related
preferred stock according to the terms of the offering described in a prospectus
supplement.

DIVIDENDS AND OTHER DISTRIBUTIONS

The depositary will distribute all cash dividends or other cash
distributions received for the preferred stock to the entitled record holders of
depositary shares in proportion to the number of depositary shares that the
holder owns on the relevant record date. The depositary will distribute only an
amount that can be distributed without attributing to any holder of depositary
shares a fraction of one cent. The depositary will

11
<PAGE>
add the undistributed balance to and treat it as part of the next sum received
by the depositary for distribution to holders of depositary shares.

If there is a non-cash distribution, the depositary will distribute property
received by it to the entitled record holders of depositary shares, in
proportion, insofar as possible, to the number of depositary shares owned by the
holders, unless the depositary determines, after consultation with us, that it
is not feasible to make such distribution. If this occurs, the depositary may,
with our approval, sell such property and distribute the net proceeds from the
sale to the holders. The Deposit Agreement also will contain provisions relating
to how any subscription or similar rights that we may offer to holders of the
preferred stock will be available to the holders of the depositary shares.

CONVERSION, EXCHANGE AND REDEMPTION

If any series of preferred stock underlying the depositary shares may be
converted or exchanged, each record holder of depositary receipts will have the
right or obligation to convert or exchange the depositary shares represented by
the depositary receipts.

Whenever we redeem shares of preferred stock held by the depositary, the
depositary will redeem, at the same time, the number of depositary shares
representing the preferred stock. The depositary will redeem the depositary
shares from the proceeds it receives from the corresponding redemption, in whole
or in part, of the applicable series of preferred stock. The depositary will
mail notice of redemption to the record holders of the depositary shares are to
be redeemed between 30 and 60 days before the date fixed for redemption. The
redemption price per depositary share will be equal to the applicable fraction
of the redemption price per share on the applicable series of preferred stock.
If less than all the depositary shares are to be redeemed, the depositary will
select which shares to be redeemed by lot, proportionate allocation or any other
method.

After the date fixed for redemption, the depositary shares called for
redemption will no longer be outstanding. When the depositary shares are no
longer outstanding, all rights of the holders will end, except the right to
receive money, securities or other property payable upon redemption.

VOTING

When the depositary receives notice of a meeting at which the holders of the
preferred stock are entitled to vote, the depositary will mail the particulars
of the meeting to the record holders of the depositary shares. Each record
holder of depositary shares on the record date may instruct the depositary on
how to vote the shares of preferred stock underlying the holder's depositary
shares. The depositary will try, if practical, to vote the number of shares of
preferred stock underlying the depositary shares according to the instructions.
We will agree to take all reasonable action requested by the depositary to
enable it to vote as instructed.

AMENDMENTS

We and the depositary may agree to amend the Deposit Agreement and the
depositary receipt evidencing the depositary shares. Any amendment that (a)
imposes or increases certain fees, taxes or other charges payable by the holders
of the depositary shares as described in the Deposit Agreement or that (b)
otherwise prejudices any substantial existing right of holders of depositary
shares, will not take effect until 30 days after the depositary has mailed
notice of the amendment to the record holders of depositary shares. Any holder
of depositary shares that continues to hold its shares at the end of the 30-day
period will be deemed to have agreed to the amendment.

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<PAGE>
TERMINATION

We may direct the depositary to terminate the Deposit Agreement by mailing a
notice of termination to holders of depositary shares at least 30 days prior to
termination. In addition, a Deposit Agreement will automatically terminate if:

- the depositary has redeemed all related outstanding depositary shares, or

- we have liquidated, terminated or wound up our business and the depositary
has distributed the preferred stock of the relevant series to the holders
of the related depositary shares.

PAYMENT OF FEES AND EXPENSES

We will pay all fees, charges and expenses of the depositary, including the
initial deposit of the preferred stock and any redemption of the preferred
stock. Holders of depositary shares will pay transfer and other taxes and
governmental charges and any other charges as are stated in the Deposit
Agreement for their accounts.

RESIGNATION AND REMOVAL OF DEPOSITARY

At any time, the depositary may resign by delivering notice to us, and we
may remove the depositary. Resignations or removals will take effect upon the
appointment of a successor depositary and its acceptance of the appointment. The
successor depositary must be appointed within 60 days after delivery of the
notice of resignation or removal and must be a bank or trust company having its
principal office in the United States and having a combined capital and surplus
of at least $50 million.

REPORTS

The depositary will forward to the holders of depositary shares all reports
and communications from us that are delivered to the depositary and that we are
required by law, the rules of an applicable securities exchange or our Articles
of Incorporation to furnish to the holders of the preferred stock. Neither we
nor the depositary will be liable if the depositary is prevented or delayed by
law or any circumstances beyond its control in performing its obligations under
the Deposit Agreement. The Deposit Agreements limits our obligations and the
depositary's obligations to performance in good faith of the duties stated in
the Deposit Agreement. Neither we nor the depositary will be obligated to
prosecute or defend any legal proceeding connected with any depositary shares or
preferred stock unless the holders of depositary shares requesting us to do so
furnish us with satisfactory indemnity. In performing our obligations, we and
the depositary may rely upon the written advice of our counsel or accountants,
on any information that competent people provide to us and on documents that we
believe are genuine.

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<PAGE>
DESCRIPTION OF THE TRUST PREFERRED SECURITIES

The following descriptions of the trust preferred securities are not
complete. You should also read the trust declaration for each Trust, the
indenture between UnionBanCal Corporation and The First National Bank of
Chicago, as trustee, relating to the issuance of the debt securities by
UnionBanCal Corporation and any supplement to the indenture. We have filed these
documents with the SEC as an exhibit to the registration statement of which this
prospectus is a part.

GENERAL

Each trust declaration authorizes the regular trustees to issue on behalf of
a Trust one series of trust preferred securities that will have the terms
described in a prospectus supplement. A Trust will use the proceeds from the
sale of its preferred and common securities to purchase a series of our debt
securities. The property trustee will hold the debt securities in trust for the
benefit of the holders of the trust preferred and trust common securities.

UnionBanCal Corporation will guarantee the trust preferred securities under
a Trust Preferred Securities Guarantee. We will agree to make payments of
distributions and payments on redemption or liquidation concerning a Trust's
trust preferred securities, but only if the Trust has funds available to make
those payments and has not done so. See "Description of the Trust Preferred
Securities Guarantees" on page 30.

The assets of a Trust available for distribution to the holders of its trust
preferred securities will be limited to payments from us under the series of
debt securities held by the Trust. If we fail to make a payment on the related
debt securities, the Trust will not have enough funds to make related payments,
including distributions, on its preferred securities.

Each guarantee, when taken together with our obligations under the related
series of debt securities and the indenture and the related trust declaration,
will provide a full and unconditional guarantee of amounts due on the trust
preferred securities issued by a Trust.

Each trust declaration will be qualified as an indenture under the Trust
Indenture Act of 1939. Each property trustee will act as indenture trustee for
the trust preferred securities to be issued by the applicable Trust, in order to
comply with the provisions of the Trust Indenture Act.

Each series of trust preferred securities will have the terms, including
distributions, redemption, voting, liquidation rights and such other preferred,
deferred or other special rights or restrictions as are described in the
relevant trust declaration or made part of the trust declaration by the Trust
Indenture Act or by the Delaware Business Trust Act. The terms of the preferred
securities will mirror the terms of the debt securities held by the applicable
Trust.

The prospectus supplement relating to the trust preferred securities of a
Trust will describe the specific terms of the preferred securities, including:

- the name of the trust preferred securities;

- the dollar amount and number of trust preferred securities issued;

- the annual distribution rate(s), or method of determining the rate(s), the
payment date(s) and the record dates used to determine the holders who are
to receive distributions and the place(s) where distributions and other
amounts payable will be paid;

- any provision relating to deferral of distribution payments;

- the date from which distributions shall be cumulative;

- the optional redemption provisions, if any, including the prices, time
periods and other terms and conditions for which trust preferred
securities will be purchased or redeemed, in whole or in part;

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<PAGE>

- the terms and conditions, if any, upon which the applicable series of debt
securities may be distributed to holders of such trust preferred
securities;

- the voting rights, if any, of holders of the trust preferred securities;

- any securities exchange on which the trust preferred securities will be
listed;

- whether such trust preferred securities are to be issued in book-entry
form and represented by one or more global certificates, and if so, the
depositary for such global certificates and the specific terms of the
depositary arrangements; and

- any other relevant rights, preferences, privileges, limitations or
restrictions of such trust preferred securities.

Each prospectus supplement will describe the United States federal income
tax considerations applicable to the purchase, holding and disposition of the
series of trust preferred securities covered by the prospectus supplement.

LIQUIDATION DISTRIBUTION UPON DISSOLUTION

Unless otherwise specified in the applicable prospectus supplement, each
trust declaration states that the related Trust shall be terminated:

- on the expiration of the term of such Trust;

- upon the bankruptcy of UnionBanCal Corporation;

- upon the filing of a certificate of dissolution or its equivalent by
UnionBanCal Corporation;

- upon the filing of a certificate of cancellation by the related Trust
after obtaining the consent of at least a majority in liquidation amount
of the trust preferred and trust common securities of such Trust, voting
together as a single class;

- 90 days after the revocation of our charter and the charter is not
reinstated during that 90-day period;

- upon the written direction from us and after the distribution of the
related debt securities directly to the holders of the trust preferred and
trust common securities of the applicable Trust in exchange for those
securities;

- upon the occurrence of adverse tax or other specified events that cause
the Trust to be terminated and the distribution of the related debt
securities directly to the holders of the trust preferred and trust common
securities of the Trust;

- before the issuance of any securities with the consent of all regular
trustees and UnionBanCal Corporation;

- upon the redemption of all of the trust common and trust preferred
securities of such Trust; or

- upon entry of a court order for the dissolution of UnionBanCal Corporation
or such Trust.

Unless otherwise specified in the applicable prospectus supplement, in the
event of a termination, after the Trust pays all amounts owed to creditors, the
holders of the trust preferred and trust common securities issued by the Trust
will be entitled to receive:

- cash equal to the aggregate liquidation amount of each trust preferred and
trust common security specified in an accompanying prospectus supplement,
plus accumulated and unpaid distributions to the date of payment; unless

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<PAGE>

- debt securities in an aggregate principal amount equal to the aggregate
liquidation amount of the trust preferred and trust common securities
distributed to the holders of the trust preferred and trust common
securities.

After the liquidation date is fixed for any distribution of debt securities:

- the trust preferred securities will no longer be deemed to be outstanding;

- DTC or its nominee, as the registered holder of the trust preferred
securities, will receive a registered global certificate or certificates
representing debt securities to be delivered upon distribution with
respect to the trust preferred securities held by DTC or its nominee; and

- any certificates representing trust preferred securities not held by DTC
or its nominee will be deemed to represent debt securities having a
principal amount equal to the $25 stated liquidation amount of the trust
preferred securities and bearing accrued and unpaid interest in an amount
equal to the accumulated and unpaid distributions on the trust preferred
securities until the holder of those certificates presents them to the
registrar for the trust preferred securities for transfer or reissuance.

If the Trust cannot pay the full amount due on its trust preferred and trust
common securities because it does not have enough assets for payment, then the
amounts the Trust owes on its trust preferred and trust common securities will
be proportionately allocated. However, if an event of default under the related
trust declaration has occurred, the total amounts due on the trust preferred
securities will be paid before any distribution on the trust common securities.

DECLARATION EVENTS OF DEFAULT

An event of default under the indenture relating to a series of debt
securities is an event of default under the trust declaration of the Trust that
owns those debt securities. See "Description of Debt Securities--Events of
Default."

Under the trust declaration, we, as the holder of the common securities,
will be treated as if we have waived an event of default under the trust
declaration that affects us until all events of default under the trust
declaration affecting the capital securities have been cured or eliminated.

UnionBanCal Corporation and the regular trustees of a Trust must file
annually with the applicable property trustee a certificate stating whether or
not UnionBanCal Corporation is in compliance with all the applicable conditions
and covenants under the related trust declaration.

Upon the happening of a event of default under the trust declaration, the
property trustee of the applicable Trust, as the sole holder of the debt
securities held by such Trust, will have the right under the indenture to
declare the principal of, premium, if any, and interest on such debt securities
to be immediately due and payable.

If a property trustee fails to enforce its rights under the related trust
declaration or the indenture to the fullest extent permitted by law and by the
terms of the trust declaration and the indenture, any holder of the trust
preferred securities issued by the Trust may sue us, or seek other remedies, to
enforce the property trustee's rights under the trust declaration or the
indenture without first instituting a legal proceeding against the property
trustee or any other person.

If we fail to pay principal, premium, if any, or interest on a series of
debt securities when payable, then a holder of the related trust preferred
securities may directly sue us or seek other remedies, to collect its
proportional allocation of payments owned.

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<PAGE>
REMOVAL AND REPLACEMENT OF TRUSTEES

Only we, as the only holder of a Trust's trust common securities, have the
right to remove or replace the trustees of such Trust. The resignation or
removal of any trustee and the appointment of a successor trustee shall be
effective only on the acceptance of appointment by the successor trustee in
accordance with the provisions of the trust declaration for such Trust.

CONVERSION OR EXCHANGE RIGHTS

The terms that govern whether trust preferred securities of any series are
convertible into or exchangeable for our common stock or other securities of
ours will be set forth in the prospectus supplement relating to the trust
preferred securities. The terms will include provisions as to whether conversion
or exchange is mandatory, at the option of the holder or at our option and may
include provisions that adjust the number of shares of our common stock or other
securities of ours that the holders of trust preferred securities may receive.

MERGERS, CONSOLIDATIONS OR AMALGAMATIONS OF THE TRUSTS

A Trust may not consolidate, amalgamate, merge with or into, or be replaced
by, or convey, transfer or lease its properties and assets substantially as an
entirety to, any other corporation or other body ("Merger Event"), except as
described below. A Trust may, with the consent of a majority of its regular
trustees and without the consent of the holders of its preferred and common
securities or the other Trustees, consolidate, amalgamate, merge with or into,
or be replaced by another Trust, provided that:

- the successor entity either

(1) assumes all of the obligations of the Trust relating to its trust
preferred and trust common securities or

(2) substitutes for the Trust's preferred and common securities other
securities substantially similar to the Trust's trust preferred and
trust common securities, so long as the successor securities rank the
same as the trust preferred and trust common securities for
distributions and payments upon liquidation, redemption and
otherwise;

- we acknowledge a trustee of the successor entity who has the same powers
and duties as the property trustee of the Trust as the holder of the
particular series of debt securities;

- the Merger Event does not adversely affect the rights, preferences and
privileges of the holders of its trust preferred and trust common
securities or successor securities in any material way, except concerning
any dilution of the holders' interest in the new entity;

- the Merger Event does not cause the preferred securities or successor
securities to be downgraded by any nationally recognized statistical
rating organization;

- the successor entity has a purpose identical to that of the Trust;

- the trust preferred securities or any successor securities are listed, or
any successor securities will be listed upon notification of issuance, on
any national securities exchange or with another organization on which the
preferred securities are then listed;

- prior to the Merger Event, we have received an opinion of counsel from a
nationally recognized law firm stating that (a) such Merger Event does not
adversely affect the rights, preferences and privileges of the holders of
the trust preferred securities, including any successor securities, in any
material respect and (b) following the Merger Event, neither the Trust nor
the successor entity will be required to register as an "investment
company" under the Investment Company Act of 1940; and

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- we guarantee the obligations of the successor entity under the successor
securities in the same manner as in the applicable guarantee and the
guarantee of the trust common securities for the Trust, if any.

In addition, unless all of the holders of the trust preferred and trust
common securities approve otherwise, a Trust shall not consolidate, amalgamate,
merge with or into, or be replaced by any other entity or permit any other
entity to consolidate, amalgamate, merge with or into, or replace it, if such
transaction would cause the Trust or the successor entity to be classified as
other than a grantor trust for United States federal income tax purposes.

VOTING RIGHTS; AMENDMENT OF DECLARATIONS

The holders of trust preferred securities have no voting rights except as
discussed below and under "--Mergers, Consolidations or Amalgamations of the
Trust" and "Description of the Trust Preferred Securities Guarantees--Amendments
and Assignment," and as otherwise required by law and the trust declaration for
the applicable Trust.

A trust declaration may be amended if approved by a majority of the regular
trustees, and in limited circumstances, the property trustee, of the applicable
Trust. However, if any proposed amendment provides for, or the regular trustees
otherwise propose to effect,

(1) any action that would adversely affect the powers, preferences or
special rights of the trust's preferred and common securities,
whether by way of amendment to such trust declaration or otherwise,
or

(2) the dissolution, winding-up or termination of the Trust other than
under the terms of its trust declaration,

then the holders of the Trust's trust preferred and trust common securities
voting together as a single class will be entitled to vote on the amendment or
proposal. In that case, the amendment or proposal will only be effective if
approved by at least a majority in liquidation amount of the trust preferred and
trust common securities affected by the amendment or proposal.

If any amendment or proposal referred to in clause (1) above would adversely
affect only the trust preferred securities or only the trust common securities
of a Trust, then only the affected class will be entitled to vote on the
amendment or proposal and the amendment or proposal will only be effective with
the approval of at least a majority in liquidation amount of the affected class.
Notwithstanding the foregoing, specified provisions of the trust declaration may
not be amended without the consent of all holders of the trust's preferred and
common securities.

No amendment may be made to a trust declaration if the amendment would:

- cause the related Trust to be characterized as other than a grantor trust
for United States federal income tax purposes;

- reduce or otherwise adversely affect the powers of the related property
trustee, unless approved by that property trustee; or

- cause the related Trust to be deemed to be an "investment company" which
is required to be registered under the Investment Company Act.

The holders of a majority in aggregate liquidation amount of the trust
preferred securities of each Trust have the right to:

- direct the time, method and place of conducting any proceeding for any
remedy available to the property trustee of the Trust; or

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- direct the exercise of any Trust or power conferred upon such property
trustee under that Trust's trust declaration, including the right to
direct the property trustee, as the holder of a series of debt securities,
to

(1) exercise the remedies available under the indenture involving the
debt securities,

(2) waive any event of default under the indenture that is waivable,

(3) cancel an acceleration of the principal of the debt securities, or

(4) consent to any amendment, modification or termination of the
indenture where consent is required,

but if an event of default under the indenture has occurred and is continuing,
then the holders of 25% of the aggregate liquidation amount of the trust
preferred securities may direct the property trustee to declare the debt
securities immediately due and payable. If, however, the indenture requires the
consent of the holders of more than a majority in aggregate principal amount of
a series of debt securities (a "super-majority"), then the property trustee for
the trust preferred securities related to that series of debt securities must
get approval of the holders of the same super-majority in liquidation amount of
the trust preferred securities. In addition, before taking any of the foregoing
actions, except for directing the time, method and place of conducting any
proceeding for any remedy available to the property trustee, the property
trustee must obtain an opinion of counsel from a nationally recognized law firm
stating that the action would not cause the Trust to be classified as other than
a grantor trust for United States federal income tax purposes.

The property trustee of a Trust will notify all trust preferred securities
holders of the Trust of any notice received from the Trustee concerning the debt
securities held by the Trust.

As described in each trust declaration, the regular trustee may hold a
meeting to have trust preferred securities holders vote on a change or have them
approve the change by written consent.

If a vote of trust preferred securities holders is taken or a consent is
obtained, any trust preferred securities that are owned by us or any of our
affiliates will, for purposes of the vote or consent, be treated as if they were
not outstanding. This means that:

- we and any of our affiliates will not be able to vote on or consent to
matters requiring the vote or consent of holders of trust preferred
securities and

- any trust preferred securities owned by us, the regular trustees or any of
our respective affiliates will not be counted in determining whether the
required percentage of votes or consents has been obtained.

INFORMATION CONCERNING THE PROPERTY TRUSTEES

The property trustees will be unaffiliated with us and The Bank of
Tokyo-Mitsubishi. For matters relating to compliance with the Trust Indenture
Act, the property trustee of each Trust will have all of the duties and
responsibilities of an indenture trustee under the Trust Indenture Act. Each
property trustee, other than during the occurrence and continuance of an event
of default under the trust declaration under the applicable Trust, undertakes to
perform only those duties that are specifically stated in the applicable trust
declaration and, upon an event of default under the trust declaration, must use
the same degree of care and skill as a prudent person would exercise or use in
the conduct of his or her own affairs. In addition, a property trustee is under
no obligation to exercise any of the powers given it by the applicable trust
declaration at the request of any holder of trust preferred securities unless it
is offered reasonable security or indemnity against the costs, expenses and
liabilities that it might incur. However, the holders of the trust preferred
securities will not be required to offer such an indemnity where the holders, by

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exercising their voting rights, direct the property trustee to take any action
following an event of default under the trust declaration.

MISCELLANEOUS

The trustees of each Trust are authorized and directed to conduct the
affairs of and to operate the Trust in such a way that

- the Trust will not be deemed to be an "investment company" required to be
registered under the Investment Company Act;

- the Trust will be classified as a grantor trust for United States federal
income tax purposes; and

- the debt securities held by the Trust will be treated as indebtedness of
UnionBanCal Corporation for United States federal income tax purposes.

UnionBanCal Corporation and the trustees of a Trust are authorized to take
any legal action that we and the trustees of such Trust determine to be
necessary or desirable for such purposes so long as the action does not violate
the Trust's certificate of trust or its trust declaration.

Holders of trust preferred securities have no preemptive or similar rights.

A Trust may not borrow money, issue debt, execute mortgages or pledge any of
its assets.

The property trustee will promptly make distributions to the holders of the
Trust's preferred securities and common securities out of funds received by such
Trust from holding our debt securities.

GOVERNING LAW

Each trust declaration and the related trust preferred securities will be
governed by and construed in accordance with the laws of the State of Delaware.

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DESCRIPTION OF DEBT SECURITIES

The following descriptions of debt securities are not complete. You should
also read the indenture. We have filed the indenture with the SEC as an exhibit
to the registration statement of which this prospectus is a part. All
capitalized terms have the meanings specified in the Indenture.

We may issue, from time to time, debt securities, in one or more series,
that will consist of either our senior debt ("Senior Debt Securities"), our
senior subordinated debt ("Senior Subordinated Debt Securities"), our
subordinated debt ("Subordinated Debt Securities") or our junior subordinated
debt ("Junior Subordinated Debt Securities" and, together with the Senior
Subordinated Debt Securities and the Subordinated Debt Securities, the
"Subordinated Securities"). The debt securities we offer will be issued under an
indenture between us and The First National Bank of Chicago, acting as trustee.
Debt securities, whether senior, senior subordinated, subordinated or junior
subordinated, may be issued as convertible debt securities or exchangeable debt
securities.

GENERAL TERMS OF THE INDENTURE

The indenture does not limit the amount of debt securities that we may
issue. It provides that we may issue debt securities up to the principal amount
that we may authorize and may be in any currency or currency unit that we may
designate. Except for the limitations on consolidation, merger and sale of all
or substantially all of our assets contained in the indenture, the terms of the
indenture do not contain any covenants or other provisions designed to give
holders of any debt securities protection against changes in our operations,
financial condition or transactions involving us.

We may issue the debt securities issued under the indenture as "discount
securities," which means they may be sold at a discount below their stated
principal amount. These debt securities, as well as other debt securities that
are not issued at a discount, may, for United States federal income tax
purposes, be treated as if they were issued with "original issue discount"
("OID") because of interest payment and other characteristics. Special United
States federal income tax considerations applicable to debt securities issued
with original issue discount will be described in more detail in any applicable
prospectus supplement.

The applicable prospectus supplement for a series of debt securities that we
issue will describe, among other things, the following terms of the offered debt
securities:

- the title;

- any limit on the aggregate principal amount;

- whether issued in fully registered form without coupons or in a form
registered as to principal only with coupons or in bearer form with
coupons;

- whether issued in the form of one or more global securities and whether
all or a portion of the principal amount of the debt securities is
represented thereby;

- the price or prices at which the debt securities will be issued;

- the date or dates on which principal is payable;

- the place or places where and the manner in which principal, premium or
interest will be payable and the place or places where the debt securities
may be presented for transfer and, if applicable, conversion or exchange;

- interest rates, and the dates from which interest, if any, will accrue,
and the dates when interest is payable and the maturity;

- the right, if any, to extend the interest payment periods and the duration
of the extensions;

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- our rights or obligations to redeem or purchase the debt securities;

- conversion or exchange provisions, if any, including conversion or
exchange prices or rates and adjustments thereto;

- the currency or currencies of payment of principal or interest;

- the terms applicable to any debt securities issued at a discount from
their stated principal amount;

- the terms, if any, under which any debt securities will rank junior to any
of our other debt;

- if the amount of payments of principal or interest is to be determined by
reference to an index or formula, or based on a coin or currency other
than that in which the debt securities are stated to be payable, the
manner in which these amounts are determined and the calculation agent, if
any, with respect thereto;

- if other than the entire principal amount of the debt securities when
issued, the portion of the principal amount payable upon acceleration of
maturity as a result of a default on our obligations;

- if applicable, covenants affording holders of debt protection against
changes in our operations, financial condition or transactions involving
us; and

- any other specific terms of any debt securities.

The applicable prospectus supplement will present United States federal
income tax considerations for holders of any debt securities and the securities
exchange or quotation system on which any debt securities are listed or quoted.

SENIOR DEBT SECURITIES

Payment of the principal of, premium, if any, and interest on Senior Debt
Securities will rank on a parity with all of our other unsecured and
unsubordinated debt.

SENIOR SUBORDINATED DEBT SECURITIES

Payment of the principal of, premium, if any, and interest on Senior
Subordinated Debt Securities will be junior in right of payment to the prior
payment in full of all of our unsubordinated debt, including Senior Debt
Securities. We will state in the applicable prospectus supplement relating to
any Senior Subordinated Debt Securities the subordination terms of the
securities as well as the aggregate amount of outstanding debt, as of the most
recent practicable date, that by its terms would be senior to the Senior
Subordinated Debt Securities. We will also state in such prospectus supplement
limitations, if any, on issuance of additional senior debt.

SUBORDINATED DEBT SECURITIES

Payment of the principal of, premium, if any, and interest on Subordinated
Debt Securities will be subordinated and junior in right of payment to the prior
payment in full of all of our senior debt, including our senior subordinated
debt. We will state in the applicable prospectus supplement relating to any
Subordinated Debt Securities the subordination terms of the securities as well
as the aggregate amount of outstanding indebtedness, as of the most recent
practicable date, that by its terms would be senior to the Subordinated Debt
Securities. We will also state in such prospectus supplement limitations, if
any, on issuance of additional senior indebtedness.

JUNIOR SUBORDINATED DEBT SECURITIES

Payment of the principal of, premium, if any, and interest on Junior
Subordinated Debt Securities will be subordinated and junior in right of payment
to the prior payment in full of all of our senior, senior

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subordinated and subordinated debt. We will state in the applicable prospectus
supplement relating to any Junior Subordinated Debt Securities the subordination
terms of the securities as well as the aggregate amount of outstanding debt, as
of the most recent practicable date, that by its terms would be senior to the
Junior Subordinated Debt Securities. We will also state in such prospectus
supplement limitations, if any, on issuance of additional senior indebtedness.

CONVERSION OR EXCHANGE RIGHTS

Debt securities may be convertible into or exchangeable for shares of our
equity securities. The terms and conditions of conversion or exchange will be
stated in the applicable prospectus supplement. The terms will include, among
others, the following:

- the conversion or exchange price;

- the conversion or exchange period;

- provisions regarding the ability of us or the holder to convert or
exchange the debt securities;

- events requiring adjustment to the conversion or exchange price; and

- provisions affecting conversion or exchange in the event of our redemption
of the debt securities.

CONSOLIDATION, MERGER OR SALE

We cannot consolidate or merge with or into, or transfer or lease all or
substantially all of our assets to, any person unless (a) we will be the
continuing corporation or (b) the successor corporation or person to which our
assets are transferred or leased is a corporation organized under the laws of
the United States, any state of the United States or the District of Columbia
and it expressly assumes our obligations under the debt securities and the
indenture. In addition, we cannot complete such a transaction unless immediately
after completing the transaction, no event of default under the indenture, and
no event which, after notice or lapse of time or both, would become an event of
default under the indenture, shall have happened and be continuing. When the
person to whom our assets are transferred or leased has assumed our obligations
under the debt securities and the indenture, we shall be discharged from all our
obligations under the debt securities and the indenture except in limited
circumstances.

This covenant would not apply to any recapitalization transaction, a change
of control of UnionBanCal Corporation or a highly leveraged transaction, unless
the transaction or change of control were structured to include a merger or
consolidation or transfer or lease of all or substantially all of our assets.

EVENTS OF DEFAULT

The term "Event of Default," when used in the indenture, unless otherwise
indicated, means any of the following:

- failure to pay interest for 30 days after the date payment is due and
payable; provided that if we extend an interest payment period in
accordance with the terms of the debt securities, the extension will not
be a failure to pay interest;

- failure to pay principal or premium, if any, on any debt security when
due, either at maturity, upon any redemption, by declaration or otherwise;

- failure to make sinking fund payments when due;

- failure to perform other covenants for 90 days after notice that
performance was required;

- events in bankruptcy, insolvency or reorganization of UnionBanCal
Corporation; or

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- any other Event of Default provided in the applicable resolution of our
Board or the supplemental indenture under which we issue a series of debt
securities.

An Event of Default for a particular series of debt securities does not
necessarily constitute an Event of Default for any other series of debt
securities issued under the indenture. IF AN EVENT OF DEFAULT RELATING TO THE
PAYMENT OF INTEREST, PRINCIPAL OR ANY SINKING FUND INSTALLMENT INVOLVING ANY
SERIES OF DEBT SECURITIES HAS OCCURRED AND IS CONTINUING, THE TRUSTEE OR THE
HOLDERS OF NOT LESS THAN 25% IN AGGREGATE PRINCIPAL AMOUNT OF THE DEBT
SECURITIES OF EACH AFFECTED SERIES MAY DECLARE THE ENTIRE PRINCIPAL OF ALL THE
DEBT SECURITIES OF THAT SERIES TO BE DUE AND PAYABLE IMMEDIATELY.

If an Event of Default relating to the performance of other covenants occurs
and is continuing for a period of 90 days after notice of such, or if any other
Event of Default occurs and is continuing involving all of the series of Senior
Debt Securities, then the trustee or the holders of not less than 25% in
aggregate principal amount of all of the series of Senior Debt Securities may
declare the entire principal amount of all of the series of Senior Debt
Securities due and payable immediately.

Similarly, if an Event of Default relating to the performance of other
covenants occurs and is continuing for a period of 90 days after notice of such,
or if any other Event of Default occurs and is continuing involving all of the
series of Subordinated Securities, then the trustee or the holders of not less
than 25% in aggregate principal amount of all of the series of Subordinated
Securities may declare the entire principal amount of all of the series of
Subordinated Securities due and payable immediately.

If, however, the Event of Default relating to the performance of other
covenants or any other Event of Default that has occurred and is continuing is
for less than all of the series of Senior Debt Securities or Subordinated
Securities, as the case may be, then, the trustee or the holders of not less
than 25% in aggregate principal amount of each affected series of the Senior
Debt Securities or the Subordinated Securities, as the case may be, may declare
the entire principal amount of all debt securities of such affected series due
and payable immediately. The holders of not less than a majority in aggregate
principal amount of the debt securities of a series may, after satisfying
conditions, rescind and annul any of the above-described declarations and
consequences involving the series.

If an Event of Default relating to events in bankruptcy, insolvency or
reorganization of UnionBanCal Corporation occurs and is continuing, then the
principal amount of all of the debt securities outstanding, and any accrued
interest, will automatically become due and payable immediately, without any
declaration or other act by the trustee or any holder.

The indenture imposes limitations on suits brought by holders of debt
securities against us. Except for actions for payment of overdue principal or
interest, no holder of debt securities of any series may institute any action
against us under the indenture unless:

- the holder has previously given to the trustee written notice of default
and continuance of such default,

- the holders of at least 25% in principal amount of the outstanding debt
securities of the affected series have requested that the trustee
institute the action,

- the requesting holders have offered the trustee reasonable indemnity for
expenses and liabilities that may be incurred by bringing the action,

- the trustee has not instituted the action within 60 days of the request,
and

- the trustee has not received inconsistent direction by the holders of a
majority in principal amount of the outstanding debt securities of the
series.

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We will be required to file annually with the trustee a certificate, signed
by an officer of UnionBanCal Corporation, stating whether or not the officer
knows of any default by us in the performance, observance or fulfillment of any
condition or covenant of the indenture.

REGISTERED GLOBAL SECURITIES

We may issue the debt securities of a series in whole or in part in the form
of one or more fully registered global securities. We will deposit any
registered global securities with a depositary or with a nominee for a
depositary identified in the applicable prospectus supplement and registered in
the name of such depositary or nominee. In such case, we will issue one or more
registered global securities denominated in an amount equal to the aggregate
principal amount of all of the debt securities of the series to be issued and
represented by such registered global security or securities.

Unless and until it is exchanged in whole or in part for debt securities in
definitive registered form, a registered global security may not be transferred
except as a whole:

- by the depositary for such registered global security to its nominee,

- by a nominee of the depositary to the depositary or another nominee of the
depositary, or

- by the depositary or its nominee to a successor of the depositary or a
nominee of the successor.

The prospectus supplement relating to a series of debt securities will
describe the specific terms of the depositary arrangement involving any portion
of the series represented by a registered global security. We anticipate that
the following provisions will apply to all depositary arrangements for debt
securities:

- ownership of beneficial interests in a registered global security will be
limited to persons that have accounts with the depositary for such
registered global security, these persons being referred to as
"participants," or persons that may hold interests through participants;

- upon the issuance of a registered global security, the depositary for the
registered global security will credit, on its book-entry registration and
transfer system, the participants' accounts with the respective principal
amounts of the debt securities represented by the registered global
security beneficially owned by the participants;

- any dealers, underwriters, or agents participating in the distribution of
the debt securities will designate the accounts to be credited; and

- ownership of beneficial interest in such registered global security will
be shown on, and the transfer of such ownership interest will be effected
only through, records maintained by the depositary for such registered
global security for interests of participants, and on the records of
participants for interests of persons holding through participants.

The laws of some states may require that specified purchasers of securities
take physical delivery of the securities in definitive form. These laws may
limit the ability of those persons to own, transfer or pledge beneficial
interests in registered global securities.

So long as the depositary for a registered global security, or its nominee,
is the registered owner of such registered global security, the depositary or
such nominee, as the case may be, will be considered the sole owner or holder of
the debt securities represented by the registered global security for all
purposes under the indenture. Except as stated below, owners of beneficial
interests in a registered global security:

- will not be entitled to have the debt securities represented by a
registered global security registered in their names,

- will not receive or be entitled to receive physical delivery of the debt
securities in the definitive form, and

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- will not be considered the owners or holders of the debt securities under
the Indenture.

Accordingly, each person owning a beneficial interest in a registered global
security must rely on the procedures of the depositary for the registered global
security and, if the person is not a participant, on the procedures of a
participant through which the person owns its interest, to exercise any rights
of a holder under the indenture.

We understand that under existing industry practices, if we request any
action of holders or if an owner of a beneficial interest in a registered global
security desires to give or take any action that a holder is entitled to give or
take under the indenture, the depositary for the registered global security
would authorize the participants holding the relevant beneficial interests to
give or take the action, and the participants would authorize beneficial owners
owning through the participants to give or take the action or would otherwise
act upon the instructions of beneficial owners holding through them.

We will make payments of principal and premium, if any, and interest, if
any, on debt securities represented by a registered global security registered
in the name of a depositary or its nominee to the depositary or its nominee, as
the case may be, as the registered owners of the registered global security.
None of UnionBanCal Corporation, the trustee or any other agent of UnionBanCal
Corporation or the trustee will be responsible or liable for any aspect of the
records relating to, or payments made on account of, beneficial ownership
interests in the registered global security or for maintaining, supervising or
reviewing any records relating to the beneficial ownership interests.

We expect that the depositary for any debt securities represented by a
registered global security, upon receipt of any payments of principal and
premium, if any, and interest, if any, in respect of the registered global
security, will immediately credit participants' accounts with payments in
amounts proportionate to their respective beneficial interests in the registered
global security as shown on the records of the depositary. We also expect that
standing customer instructions and customary practices will govern payments by
participants to owners of beneficial interests in the registered global security
held through the participants, as is now the case with the securities held for
the accounts of customers in bearer form or registered in "street name." We also
expect that any of these payments will be the responsibility of the
participants.

If the depositary for any debt securities represented by a registered global
security is at any time unwilling or unable to continue as depositary or stops
being a clearing agency registered under the Exchange Act, we will appoint an
eligible successor depositary. If we fail to appoint an eligible successor
depositary within 90 days, we will issue the debt securities in definitive form
in exchange for the registered global security. In addition, we may at any time
and in our sole discretion decide not to have any of the debt securities of a
series represented by one or more registered global securities. In that event,
we will issue debt securities of the series in a definitive form in exchange for
all of the registered global securities representing the debt securities. The
trustee will register any debt securities issued in definitive form in exchange
for a registered global security in the name or names as the depositary, based
upon instructions from its participants, shall instruct the trustee.

We may also issue bearer debt securities of a series in the form of one or
more global securities, referred to as "bearer global securities." We will
deposit these securities with a common depositary for Euroclear System and Cedel
Bank, SOCIETE ANONYME, or with a nominee for the depositary identified in the
prospectus supplement relating to the series. The prospectus supplement relating
to a series of debt securities represented by a bearer global security will
describe the applicable terms and procedures. These will include the specific
terms of the depositary arrangement and any specific procedures for the issuance
of debt securities in definitive form in exchange for a bearer global security,
in proportion to the series represented by a bearer global security.

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DISCHARGE, DEFEASANCE AND COVENANT DEFEASANCE

We can discharge or decrease our obligations under the indenture as stated
below.

We may discharge obligations to holders of any series of debt securities
that have not already been delivered to the trustee for cancellation and that
have either become due and payable or are by their terms to become due and
payable, or are scheduled for redemption, within one year. We may effect a
discharge by irrevocably depositing with the trustee cash or U.S. government
obligations, as trust funds, in an amount certified to be enough to pay when
due, whether at maturity, upon redemption or otherwise, the principal of,
premium, if any, and interest on the debt securities and any mandatory sinking
fund payments.

Unless otherwise provided in the applicable prospectus supplement, we may
also discharge any and all of our obligations to holders of any series of debt
securities at any time ("defeasance"). We may also be released from the
obligations imposed by any covenants of any outstanding series of debt
securities and provisions of the indenture, and we may omit to comply with those
covenants without creating an event of default under the trust declaration
("covenant defeasance"). We may effect defeasance and covenant defeasance only
if, among other things:

- we irrevocably deposit with the trustee cash or U.S. government
obligations, as trust funds, in an amount certified to be enough to pay at
maturity, or upon redemption, the principal, premium, if any, and interest
on all outstanding debt securities of the series;

- we deliver to the trustee an opinion of counsel from a nationally
recognized law firm to the effect that the holders of the series of debt
securities will not recognize income, gain or loss for U.S. federal income
tax purposes as a result of the defeasance or covenant defeasance and that
defeasance or covenant defeasance will not otherwise alter the holders'
U.S. federal income tax treatment of principal, premium, if any, and
interest payments on the series of debt securities; and

- in the case of subordinated debt securities, no event or condition shall
exist that, based on the subordination provisions applicable to the
series, would prevent us from making payments of principal of, premium, if
any, and interest on any of the applicable subordinated debt securities at
the date of the irrevocable deposit referred to above or at any time
during the period ending on the 91st day after the deposit date.

In the case of a defeasance by us, the opinion we deliver must be based on a
ruling of the Internal Revenue Service issued, or a change in U.S. federal
income tax law occurring, after , 1999, since such a
result would not occur under the U.S. federal income tax laws in effect on such
date.

Although we may discharge or decrease our obligations under the indenture as
described in the two preceding paragraphs, we may not avoid, among other things,
our duty to register the transfer or exchange of any series of debt securities,
to replace any temporary, mutilated, destroyed, lost or stolen series of debt
securities or to maintain an office or agency in respect of any series of debt
securities.

MODIFICATION OF THE INDENTURE

The indenture provides that we and the trustee may enter into supplemental
indentures without the consent of the holders of debt securities to:

- secure any debt securities,

- evidence the assumption by a successor corporation of our obligations,

- add covenants for the protection of the holders of debt securities,

- cure any ambiguity or correct any inconsistency in the Indenture,

- establish the forms or terms of debt securities of any series, and

- evidence and provide for the acceptance of appointment by a successor
trustee.

27
<PAGE>

The indenture also provides that we and the trustee may, with the consent of
the holders of not less than a majority in aggregate principal amount of debt
securities of all series of Senior Debt Securities or of Subordinated
Securities, as the case may be, then outstanding and affected, voting as one
class, add any provisions to, or change in any manner, eliminate or modify in
any way the provisions of, the indenture or modify in any manner the rights of
the holders of the debt securities. We and the trustee may not, however, without
the consent of the holder of each outstanding debt security affected thereby:

- extend the final maturity of any debt security;

- reduce the principal amount or premium, if any;

- reduce the rate or extend the time of payment of interest;

- reduce any amount payable on redemption;

- change the currency in which the principal, unless otherwise provided for
a series, premium, if any, or interest is payable;

- reduce the amount of the principal of any debt security issued with an
original issue discount that is payable upon acceleration or provable in
bankruptcy;

- alter provisions of the indenture relating to the debt securities not
denominated in U.S. dollars;

- impair the right to institute suit for the enforcement of any payment on
any debt security when due; or

- reduce the percentage of holders of debt securities of any series whose
consent is required for any modification of the indenture.

CONCERNING THE TRUSTEE

The indenture provides that there may be more than one trustee under the
indenture, each for one or more series of debt securities. If there are
different trustees for different series of debt securities, each trustee will be
a trustee of a Trust under the indenture separate and apart from the trust
administered by any other trustee under the indenture. Except as otherwise
indicated in this prospectus or any prospectus supplement, any action permitted
to be taken by a trustee may be taken by such trustee only on the one or more
series of debt securities for which it is the trustee under the indenture. Any
trustee under the indenture may resign or be removed from one or more series of
debt securities. All payments of principal of, premium, if any, and interest on,
and all registration, transfer, exchange, authentication and delivery of, the
debt securities of a series will be effected by the trustee for such series at
an office designated by such trustee in New York, New York.

If the trustee becomes a creditor of UnionBanCal Corporation, the indenture
places limitations on the right of the trustee to obtain payment of claims or to
realize on property received in respect of any such claim as security or
otherwise. The trustee may engage in other transactions. If it acquires any
conflicting interest relating to any duties concerning the debt securities,
however, it must eliminate the conflict or resign as trustee.

The holders of a majority in aggregate principal amount of any series of
debt securities then outstanding will have the right to direct the time, method
and place of conducting any proceeding for exercising any remedy available to
the trustee concerning the applicable series of debt securities, provided that
the direction:

- would not conflict with any rule of law or with the indenture,

- would not be unduly prejudicial to the rights of another holder of the
debt securities, and

- would not involve any trustee in personal liability.

The indenture provides that in case an Event of Default shall occur, not be
cured and be known to any trustee, the trustee must use the same degree of care
as a prudent person would use in the conduct of his

28
<PAGE>

or her own affairs in the exercise of the Trust's power. The trustee will be
under no obligation to exercise any of its rights or powers under the indenture
at the request of any of the holders of the debt securities, unless they shall
have offered to the trustee security and indemnity satisfactory to the trustee.

NO INDIVIDUAL LIABILITY OF INCORPORATORS, SHAREHOLDERS, OFFICERS OR DIRECTORS

The indenture provides that no incorporator and no past, present or future
shareholder, officer or director of UnionBanCal Corporation or any successor
corporation in their capacity as such shall have any individual liability for
any of our obligations, covenants or agreements under the debt securities or the
indenture.

GOVERNING LAW

The indenture and the debt securities will be governed by, and construed in
accordance with, the laws of the State of New York.

29
<PAGE>
DESCRIPTION OF THE TRUST PREFERRED SECURITIES GUARANTEES

The following is a description of the material terms of the Trust Preferred
Securities Guarantees. The description is not complete. You should also read the
guarantees. We have filed the guarantees with the SEC as an exhibit to the
registration statement of which this prospectus is a part.

GENERAL

We will execute a guarantee, which benefits the holders of trust preferred
securities, at the time that a Trust issues those trust preferred securities.
Each guarantee will be qualified as an indenture under the Trust Indenture Act.
Unless otherwise stated in a prospectus supplement, The First National Bank of
Chicago will act as indenture trustee under each guarantee for the purposes of
compliance with the Trust Indenture Act. The trustee will hold each guarantee
for the benefit of the preferred securities holders of the applicable Trust.

We will agree, as described in each guarantee, to pay in full to the holders
of the trust preferred securities issued by the applicable Trust, the Guarantee
Payments, when and as due, regardless of any defense, right of set-off or
counterclaim which the Trust may have or assert. The following payments
("Guarantee Payments"), if not previously paid by a Trust, will be covered by
the applicable guarantee:

- any accrued and unpaid distributions required to be paid on the applicable
trust preferred securities, if the Trust has funds available to make the
payment;

- the redemption price, if the Trust has funds available to make the
payment; and

- upon a voluntary or involuntary dissolution and liquidation of the Trust,
other than in connection with a distribution of debt securities to holders
of the applicable trust preferred securities or the redemption of all the
trust preferred securities, the lesser of:

(1) the aggregate of the liquidation amount specified in the prospectus
supplement for each trust preferred security plus all accrued and
unpaid distributions on the trust preferred securities to the date of
payment, if the Trust has funds available to make the payment and

(2) the amount of assets of the Trust remaining available for
distribution to holders of its trust preferred securities upon a
dissolution and liquidation of the Trust (either, a "Liquidation
Payment").

Our obligation to make a Guarantee Payment may be satisfied by directly
paying the required amounts to the holders of the trust preferred securities or
by causing the Trust to pay the amounts to the holders.

No single document executed by us relating to the issuance of trust
preferred securities will provide for its full, irrevocable and unconditional
guarantee of the trust preferred securities. It is only the combined operation
of our obligations under the indenture and the applicable guarantee and trust
declaration that has the effect of providing a full, irrevocable and
unconditional guarantee of a Trust's obligations under its trust preferred
securities.

STATUS OF THE TRUST PREFERRED SECURITIES GUARANTEES

Each guarantee will constitute an unsecured obligation of UnionBanCal
Corporation and will rank:

- subordinate and junior in right of payment to all of our other
liabilities, except those obligations made equal or junior to its
obligations under a guarantee;

- equal with the most senior preferred or preference stock now or hereafter
issued by us, and with any guarantee now or hereafter issued by us in
respect of any preferred or preference stock of any of our affiliates; and

30
<PAGE>
- senior to our common stock.

Each trust declaration will require that the holder of trust preferred
securities accept the subordination provisions and other terms of the guarantee.
Each guarantee will constitute a guarantee of payment and not of collection. In
other words, the holder of the guaranteed security may sue us, or seek other
remedies, to enforce its rights under the guarantee without first suing any
other person or entity. A guarantee will not be discharged except:

- upon payment of the Guarantee Payments in full if not previously paid,

- upon distribution of the underlying securities to the holders of trust
preferred securities upon any conversion or exchange of the holder's trust
preferred securities into the designated securities, if applicable or

- upon distribution to the applicable holders of trust preferred securities
of the corresponding series of debt securities under the appropriate trust
declaration.

AMENDMENTS AND ASSIGNMENT

Changes to the guarantee that do not adversely affect the rights of holders
of trust preferred securities in any material respect may be made without the
consent of those holders. Otherwise, a guarantee may only be amended with the
prior approval of the holders of at least a majority in aggregate liquidation
amount of the affected trust preferred securities, excluding any affected trust
preferred securities held by us or any of our affiliates. A description of the
way to obtain any approval is described under "Description of the Trust
Preferred Securities--Voting Rights; Amendment of Declarations." All guarantees
and agreements contained in the guarantee will be binding on our successors,
assigns, receivers, trustees and representatives and are for the benefit of the
holders of the applicable trust preferred securities.

TRUST PREFERRED SECURITIES GUARANTEE EVENTS OF DEFAULT

An event of default under a guarantee occurs if:

- we fail to make any of our required payments or perform our obligations
under the guarantee, or

- we fail to deliver the designated securities upon an appropriate election
by the holder of related trust preferred securities to convert or exchange
the trust preferred securities into the designated securities, if
applicable.

The holders of at least a majority in aggregate liquidation amount of the
trust preferred securities relating to each guarantee, excluding any trust
preferred securities held by us or any of our affiliates, will have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the trustee relating to such guarantee or to direct the exercise of
any Trust or power given to the trustee under such guarantee.

INFORMATION CONCERNING THE TRUST PREFERRED GUARANTEE TRUSTEE

The trustee under a guarantee, other than during the occurrence and
continuation of a default under such guarantee, will only perform the duties
that are specifically described in the guarantee. Upon the occurrence of a
default, the trustee will exercise the same degree of care and skill as a
prudent person would exercise or use in the conduct of his or her own affairs. A
trustee is under no obligation to exercise any of its powers as described in the
applicable guarantee at the request of any holder of covered trust preferred
securities unless it is offered reasonable security and indemnity against the
costs, expenses and liabilities that it might incur.

31
<PAGE>
TERMINATION OF THE TRUST PREFERRED SECURITIES GUARANTEE

Each guarantee will terminate once the applicable trust preferred securities
are paid in full upon distribution of the underlying securities to the holders
of trust preferred securities, upon any conversion or exchange of the holder's
trust preferred securities into the designated securities, if applicable, or
upon distribution of the corresponding series of debt securities to the holders
of the applicable trust preferred securities. Each guarantee will continue to be
effective or will be reinstated if at any time any holder of trust preferred
securities issued by the applicable Trust must restore payment of any sums paid
under such trust preferred securities or such guarantee.

MISCELLANEOUS

UnionBanCal Corporation will pay all fees and expenses related to:

- the offering of the trust preferred securities and the junior subordinated
debentures,

- the organization, maintenance and dissolution of a Trust,

- the retention of the trustees and

- the enforcement by the property trustee of the rights of the holders of
the trust preferred securities.

GOVERNING LAW

The guarantees will be governed by and construed in accordance with the laws
of the State of New York.

32
<PAGE>
RELATIONSHIP AMONG THE TRUST PREFERRED SECURITIES, THE TRUST PREFERRED
SECURITIES GUARANTEE AND THE DEBT SECURITIES HELD BY EACH TRUST

We will guarantee payments of distributions and redemption and liquidation
payments due on each series of the trust preferred securities, if the applicable
Trust has funds available for the payments, as described under "Description of
the Trust Preferred Securities Guarantees." No single document executed by us in
connection with the issuance of any series of the trust preferred securities
will provide for its full, irrevocable and unconditional guarantee of any trust
preferred securities. It is only the combined operation of our obligations under
the applicable guarantee, trust declaration and the indenture that has the
effect of providing a full, irrevocable and unconditional guarantee of the
Trust's obligations under its trust preferred securities.

As long as we make payments of interest and other payments when due on the
debt securities held by a Trust, those payments will be sufficient to cover the
payment of distributions and redemption and liquidation payments due on the
trust preferred securities issued by that Trust, primarily because:

- the aggregate principal amount of the debt securities will be equal to the
sum of the aggregate liquidation amount of the trust preferred and trust
common securities;

- the interest rate and interest and other payment dates on the debt
securities will match the distribution rate and distribution and other
payment dates for the trust preferred securities;

- we will pay for any and all costs, expenses and liabilities of each Trust,
except such Trust's obligations under its trust preferred securities; and

- each trust declaration provides that the related Trust will not engage in
any activity that is not consistent with the limited purposes of the
Trust.

If we do not make payments on the debt securities, the applicable Trust will
not have funds available to make payments of distributions or other amounts due
on its trust preferred securities. In those circumstances, you will not be able
to rely upon the guarantee for payment of these amounts. Instead, you may
directly sue us or seek other remedies to collect your proportionate share of
payments owed. If you sue us to collect payment, then we will assume your rights
as a holder of trust preferred securities under the Trust's trust declaration if
we make a payment to you in any legal action.

A holder of any trust preferred security may sue us, or seek other remedies,
to enforce its rights under the guarantee without first suing the applicable
trustee, the Trust that issued the trust preferred security or any other person
or entity.

33
<PAGE>
PLAN OF DISTRIBUTION

UnionBanCal Corporation may sell common stock, preferred stock, depositary
shares or any series of debt securities and a Trust may sell trust preferred
securities in one or more of the following ways from time to time:

- to underwriters or dealers for resale to the public or to institutional
investors;

- directly to institutional investors; or

- through agents to the public or to institutional investors.

The prospectus supplements will state the terms of the offering of the
securities, including:

- the name or names of any underwriters or agents,

- the purchase price of the securities,

- the proceeds to UnionBanCal Corporation or the applicable Trust, as the
case may be, from the sale,

- any underwriting discounts or agency fees and other items constituting
underwriters' or agents' compensation,

- any initial public offering price,

- any discounts or concessions allowed or reallowed or paid to dealers, and

- any securities exchanges on which such securities may be listed.

If underwriters are used in the sale, the underwriters will acquire the
securities for their own account and may resell them from time to time in one or
more transactions, including negotiated transactions, at a fixed public offering
price or at varying prices determined at the time of sale.

If a dealer is used in the sale, we and/or a Trust, as the case may be, will
sell such securities to the dealer, as principal. The dealer may then resell the
securities to the public at varying prices to be determined by the dealer at the
time for resale.

Unless otherwise set forth in a prospectus supplement, there will be
conditions to the underwriters' obligations to purchase any series of
securities, and the underwriters will be obligated to purchase all of a series
of securities, if any are purchased.

Underwriters and agents may be entitled under agreements entered into with
us and/or a Trust to indemnification by us and/or a Trust against certain civil
liabilities, including liabilities under the Securities Act, or to contribution
concerning payments that the underwriters or agents may be required to make in
respect thereof. Underwriters and agents may be customers of, engage in
transactions with, or perform services for us and our affiliates in the ordinary
course of business.

Other than the common stock, which is listed on the Nasdaq National Market,
each of the securities issued hereunder will be a new issue of securities and
will have no prior trading market. Any common stock sold based on a prospectus
supplement will be quoted on the Nasdaq National Market, after official notice
of issuance. Any underwriters to whom UnionBanCal Corporation or a Trust sells
securities for public offering and sale may make a market in the securities, but
no underwriter will be obligated to do so and may discontinue any market making
at any time without notice. The securities may or may not be listed on a
national securities exchange.

34
<PAGE>
LEGAL OPINIONS

The validity of the securities being offered hereby is being passed upon for
UnionBanCal Corporation and each Trust by Skadden, Arps, Slate, Meagher & Flom
LLP, Los Angeles, California.

EXPERTS

The consolidated financial statements incorporated in this prospectus by
reference from Form 8-K of UnionBanCal Corporation dated January 11, 1999, have
been audited by Deloitte & Touche LLP, independent auditors, as stated in their
report incorporated in this prospectus by reference, and have been so
incorporated in reliance upon the report of such firm given upon their authority
as experts in accounting and auditing. The consolidated financial statements
give retroactive effect to the 1996 merger of BanCal Tri-State Corporation and
Union Bank which has been accounted for as a pooling-of-interests. The
consolidated statements of income, changes in shareholders' equity, and cash
flows of Union Bank and subsidiaries for the year ended December 31, 1995 (not
presented separately in Form 8-K) were audited by Arthur Andersen LLP,
independent public accountants, as stated in their report also incorporated by
reference herein, in reliance upon the authority of such firm as experts in
giving said report.

35
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION

We file reports, proxy statements, and other information with the SEC. You
can read and copy these reports, proxy statements, and other information
concerning UnionBanCal Corporation at the SEC's Public Reference Room at 450
Fifth Street, N.W., Washington, D.C. 20549. Please call the SEC at
1-800-SEC-0330 for further information on the Public Reference Room. The SEC
maintains an internet site at http://www.sec.gov that contains reports, proxy
and information statements and other information regarding issuers that file
electronically with the SEC, including UnionBanCal Corporation. Our common stock
is quoted on the Nasdaq Stock Market's National Market System. These reports,
proxy statements and other information are also available for inspection at the
offices of the National Association of Securities Dealers, Inc., Report Section,
1735 K Street N.W., Washington, D.C. 20006.

This prospectus is part of a registration statement that we and the Trusts
filed with the SEC. You can obtain the full registration statement from the SEC
as indicated above, or from us.

The SEC allows us to "incorporate by reference" the information we file with
the SEC. This permits us to disclose important information to you by referring
to these filed documents. Any information referred to in this way is considered
part of this prospectus, and any information that we file with the SEC after the
date of this prospectus will automatically be deemed to update and supersede
this information. We incorporate by reference the following documents that have
been filed with the SEC:

- Annual Report on Form 10-K for the year ended December 31, 1997 and all
amendments thereto (except for Item 8, "Financial Statements and
Supplementary Data," which has been updated and incorporated by reference
in this prospectus);

- Quarterly Reports on Form 10-Q for the quarters ended March 31, 1998, June
30, 1998 and September 30, 1998 and all amendments thereto;

- Current Report on Form 8-K dated August 10, 1998;

- Current Report on Form 8-K dated December 7, 1998; and

- Current Report on Form 8-K dated January 11, 1999.

We also incorporate by reference any future filings made with the SEC under
Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until
we file a post-effective amendment that indicates the termination of the
offering of the securities made by this prospectus.

We will provide without charge upon written or oral request a copy of any or
all of the documents that are incorporated by reference into this prospectus,
other than exhibits which are specifically incorporated by reference into such
documents. Requests should be directed to Investor Relations, UnionBanCal
Corporation, 400 California Street, San Francisco, California 94104 (telephone
415-765-2969).

There are no separate financial statements of the Trusts in this prospectus.
We do not believe such financial statements would be helpful because:

- The Trusts are subsidiaries of UnionBanCal Corporation, which files
consolidated financial information under the Exchange Act.

- The Trusts do not have any independent operations other than issuing the
preferred and common securities and purchasing our debt securities.

- The Trusts' only material assets will be our debt securities when issued.

- The combined obligations of UnionBanCal Corporation under the debt
securities, the Trust Preferred Securities Guarantees, the Declarations
and the Indenture have the effect of providing a full, irrevocable and
unconditional guarantee of the Trusts' obligations under their trust
preferred securities. See "Description of Debt Securities," "Description
of the Trust Preferred Securities Guarantees" and "Relationship Among the
Trust Preferred Securities, the Trust Preferred Securities Guarantee and
the Debt Securities Held by Each Trust."

36
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The following table presents the expenses to be borne by UnionBanCal
Corporation and The Bank of Tokyo-Mitsubishi in connection with the offerings
described in this Registration Statement. UnionBanCal Corporation and The Bank
of Tokyo-Mitsubishi will each pay 50% of the registration-related expenses. All
expenses listed, other than the Securities and Exchange Commission registration
fee, are estimates.

<TABLE>
<S> <C>
Securities and Exchange Commission Registration Fee............. $ 208,500
Transfer Agents, Trustees and Depositary's Fees and Expenses.... 30,000
Printing and Engraving Fees and Expenses........................ 125,000
Accounting Fees and Expenses.................................... 750,000
Blue Sky Fees and Expenses...................................... 10,000
Legal Fees...................................................... 450,000
Rating Agency Fees.............................................. 325,000
Miscellaneous (including Listing Fees, if applicable)........... 101,500
---------
Total....................................................... $2,000,000
---------
---------
</TABLE>

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS

As authorized by Section 317 of the CGCL, each director and officer of
UnionBanCal Corporation may be indemnified by UnionBanCal Corporation against
expenses (including attorney's fees, judgments, fines and amounts paid in
settlement) actually and reasonably incurred in connection with the defense or
settlement of any threatened, pending or completed legal proceedings in which
such person is involved by reason of the fact that such person is or was a
director or officer of UnionBanCal Corporation if such person acted in good
faith and in a manner that such person reasonably believed to be in the best
interests of UnionBanCal Corporation and, with respect to any criminal action or
proceeding, if such person had no reasonable cause to believe that his conduct
was unlawful. If the legal proceeding, however, is by or in the right of
UnionBanCal Corporation, the director or officer may not be indemnified in
respect of any claim, issue or matter as to which such person shall have been
adjudged to be liable for negligence or misconduct in the performance of his
duty to UnionBanCal Corporation unless a court determines otherwise.

In addition, we maintain a directors' and officers' liability policy.

Article VII of the Articles of Incorporation and Section 55 of the Bylaws
provide that, to the fullest extent permitted by law, directors of UnionBanCal
Corporation will not be liable for monetary damages to UnionBanCal Corporation
or its shareholders for breaches of their fiduciary duties.

ITEM 16. EXHIBITS

The following is a list of all exhibits filed as a part of this Registration
Statement on Form S-3, including those incorporated herein by reference.

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
- ------ --------------------------------------------------------------------------
<C> <S>

4.1* Specimen Certificate representing shares of Common Stock

4.2* Corrected Certificate of Trust of UnionBanCal Finance Trust I

4.3* Corrected Certificate of Trust of UnionBanCal Finance Trust II

4.4* Corrected Certificate of Trust of UnionBanCal Finance Trust III
</TABLE>

II-1
<PAGE>

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
- ------ --------------------------------------------------------------------------
<C> <S>
4.5* Corrected Certificate of Trust of UnionBanCal Finance Trust IV

4.6* Declaration of Trust of UnionBanCal Finance Trust I

4.7* Declaration of Trust of UnionBanCal Finance Trust II

4.8* Declaration of Trust of UnionBanCal Finance Trust III

4.9* Declaration of Trust of UnionBanCal Finance Trust IV

4.10 Form of Amended and Restated Declaration of Trust of UnionBanCal Finance
Trust I

4.11 Form of Amended and Restated Declaration of Trust of UnionBanCal Finance
Trust II (included in Exhibit 4.10)

4.12 Form of Amended and Restated Declaration of Trust of UnionBanCal Finance
Trust III (included in Exhibit 4.10)

4.13 Form of Amended and Restated Declaration of Trust of UnionBanCal Finance
Trust IV (included in Exhibit 4.10)

4.14 Form of Indenture

4.15 Form of Trust Preferred Security (included in Exhibit 4.10)

4.16 Form of Preferred Securities Guarantee Agreement with respect to Trust
Preferred Securities to be issued by UnionBanCal Finance Trust I

4.17 Form of Preferred Securities Guarantee Agreement with respect to Trust
Preferred Securities to be issued by UnionBanCal Finance Trust II
(included in Exhibit 4.16)

4.18 Form of Preferred Securities Guarantee Agreement with respect to Trust
Preferred Securities to be issued by UnionBanCal Finance Trust III
(included in Exhibit 4.16)

4.19 Form of Preferred Securities Guarantee Agreement with respect to Trust
Preferred Securities to be issued by UnionBanCal Finance Trust IV
(included in Exhibit 4.16)

4.20 Form of Deposit Agreement

4.21 Form of Depositary Share (included in Exhibit 4.20)

5.1 Opinion of Skadden, Arps, Slate, Meagher & Flom LLP as to the legality of
the Common Stock, Preferred Stock, Debt Securities; Trust Preferred
Securities and Trust Preferred Securities Guarantee

8.1 Form of Opinion of Skadden, Arps, Slate, Meagher & Flom LLP

12.1 Statement re: Computation of Ratios of Earnings to Fixed Charges and of
Earnings to Combined Fixed Charges and Preferred Stock Dividends of
UnionBanCal Corporation

23.1 Consent of Deloitte & Touche LLP, Independent Auditors

23.2 Consent of Arthur Andersen LLP, Independent Accountants

23.3 Consent of Skadden, Arps, Slate, Meagher & Flom LLP (included in Exhibit
5.1)

23.4 Consent of Skadden, Arps, Slate, Meagher & Flom LLP (included in Exhibit
8.1)

24.1* Power of Attorney of certain officers and directors of UnionBanCal
Corporation

25.1 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The First National Bank of Chicago, as Trustee
under the Indenture (UnionBanCal Corporation)
</TABLE>

II-2

<PAGE>

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBITS
- ------ --------------------------------------------------------------------------
<C> <S>
25.2 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The First National Bank of Chicago, as Trustee
under the Indenture (UnionBanCal Finance Trust I)

25.3 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The First National Bank of Chicago, as Trustee
under the Indenture (UnionBanCal Finance Trust II)

25.4 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The First National Bank of Chicago, as Trustee
under the Indenture (UnionBanCal Finance Trust III)

25.5 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The First National Bank of Chicago, as Trustee
under the Indenture (UnionBanCal Finance Trust IV)
</TABLE>

- ------------------------

* Previously filed.

ITEM 17. UNDERTAKINGS

The undersigned registrants hereby undertake:

(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:

(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;

(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than a 20 percentage change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee" table in
the effective registration statement;

(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;

PROVIDED, HOWEVER, that paragraphs (1)(i) and 1(ii) do not apply if the
registration statement is on Form S-3 or Form S-8 or Form F-3, and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrants pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act that are incorporated by reference in the registration
statement;

(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof;

(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.

II-3
<PAGE>
The undersigned registrants hereby undertake that, for purposes of
determining any liability under the Securities Act of 1933, each filing of each
of the registrant's annual report pursuant to Section 13(a) or Section 15(d) of
the Securities Exchange Act that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of any
of the registrants pursuant to the provisions set forth in Item 15, or
otherwise, each of the registrants has been advised that in the opinion of the
SEC such indemnification is against public policy as expressed in the Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by one of the registrants of
expenses incurred or paid by a director, officer or controlling registrant of
expenses incurred or paid by a director, officer or controlling person of one of
the registrants in the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in connection with the
securities being registered, each of the registrants will, unless in the opinion
of its counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Act and will be governed by the
final adjudication of such issue.

The undersigned registrants undertake that:

(1) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the registrant pursuant to Rule 424(b) (1) or (4) or 497(h)
under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective.

(2) For the purpose of determining any liability under the Securities Act of
1933, each post-effective amendment that contains a form of prospectus shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.

The undersigned registrants hereby undertake to file an application for the
purpose of determining the eligibility of the trustee to act under subsection
(a) of Section 310 of the Trust Indenture Act in accordance with the rules and
regulations prescribed by the Commission under Section 305(b)(2) of the Act.

II-4
<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on this Form S-3 and has duly caused this Amendment No.
2 to Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of San Francisco, State of California, on
this 29th day of January, 1999.

<TABLE>
<S> <C> <C>
UNIONBANCAL CORPORATION

By: /s/ TAKAHIRO MORIGUCHI
-----------------------------------------
Takahiro Moriguchi
PRESIDENT AND CHIEF EXECUTIVE OFFICER
</TABLE>

Pursuant to the requirements of the Securities Act, this Amendment No. 2 to
Registration Statement has been signed below by the following persons in the
capacities indicated on January 29, 1999.

<TABLE>
<CAPTION>
SIGNATURES TITLE
- ------------------------------------ ------------------------------------

<C> <S>
/s/ TAKAHIRO MORIGUCHI President and Chief Executive
- ------------------------------------ Officer and Director
Takahiro Moriguchi (Principal Executive Officer)

*
- ------------------------------------ Deputy Chairman of the Board
Yoshihiko Someya

* Executive Vice President and Chief
- ------------------------------------ Financial Officer
David I. Matson (Principal Financial Officer)

*
- ------------------------------------ Senior Vice President and Controller
David A. Anderson (Principal Accounting Officer)

*
- ------------------------------------ Chairman of the Board
Kaoru Hayama

*
- ------------------------------------ Vice Chairman of the Board
Richard C. Hartnack

*
- ------------------------------------ Vice Chairman of the Board
Robert M. Walker
</TABLE>

II-5
<PAGE>
<TABLE>
<CAPTION>
SIGNATURES TITLE
- ------------------------------------ ------------------------------------

<C> <S>
*
- ------------------------------------ Director
Richard D. Farman

*
- ------------------------------------ Director
Stanley F. Farrar

*
- ------------------------------------ Director
Herman E. Gallegos

*
- ------------------------------------ Director
Jack L. Hancock

*
- ------------------------------------ Director
Harry W. Low

*
- ------------------------------------ Director
Mary S. Metz

*
- ------------------------------------ Director
Raymond E. Miles

*
- ------------------------------------ Director
J. Fernando Niebla

*
- ------------------------------------ Director
Sidney R. Petersen

*
- ------------------------------------ Director
Carl W. Robertson

*
- ------------------------------------ Director
Henry T. Swigert
</TABLE>

II-6
<PAGE>
<TABLE>
<CAPTION>
SIGNATURES TITLE
- ------------------------------------ ------------------------------------

<C> <S>
*
- ------------------------------------ Director
Tsuneo Wakai

*
- ------------------------------------ Director
Hiroshi Watanabe

- ------------------------------------ Director
Blenda J. Wilson

- ------------------------------------ Director
Kenji Yoshizawa
</TABLE>

<TABLE>
<S> <C> <C> <C>
*By: /s/ TAKAHIRO MORIGUCHI
-------------------------
Takahiro Moriguchi
ATTORNEY-IN-FACT
</TABLE>

II-7
<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, UnionBanCal
Finance Trust I, UnionBanCal Finance Trust II, UnionBanCal Finance Trust III and
UnionBanCal Finance Trust IV, each certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-3, and has
duly caused this Amendment No. 2 to Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of San
Francisco, State of California, on January 29, 1999.

<TABLE>
<S> <C> <C>
UNIONBANCAL FINANCE TRUST I

By: UnionBanCal Corporation, as Sponsor

By: /s/ DAVID I. MATSON
-----------------------------------------
Name: David I. Matson
Title:Executive Vice President and
Chief Financial Officer

UNIONBANCAL FINANCE TRUST II

By: UnionBanCal Corporation, as Sponsor

By: /s/ DAVID I. MATSON
-----------------------------------------
Name: David I. Matson
Title:Executive Vice President and
Chief Financial Officer

UNIONBANCAL FINANCE TRUST III

By: UnionBanCal Corporation, as Sponsor

By: /s/ DAVID I. MATSON
-----------------------------------------
Name: David I. Matson
Title:Executive Vice President and
Chief Financial Officer

UNIONBANCAL FINANCE TRUST IV

By: UnionBanCal Corporation, as Sponsor

By: /s/ DAVID I. MATSON
-----------------------------------------
Name: David I. Matson
Title:Executive Vice President and
Chief Financial Officer
</TABLE>

II-8

<PAGE>

Exhibit 4.10

- ------------------------------------------------------------------------------

FORM OF

AMENDED AND RESTATED DECLARATION

OF TRUST

UNIONBANCAL FINANCE TRUST /(1)

DATED AS OF _________ ____, _____

- -------------------------

(1) Insert I, I, III or IV as applicable.

- ------------------------------------------------------------------------------
<PAGE>

TABLE OF CONTENTS

Page
----
<S> <C>
ARTICLE I

INTERPRETATION AND DEFINITIONS
SECTION 1.1. DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1

ARTICLE II

TRUST INDENTURE ACT
SECTION 2.1. TRUST INDENTURE ACT: APPLICATION . . . . . . . . . . . . . . . . . . .9
SECTION 2.2. LISTS OF HOLDERS OF SECURITIES.. . . . . . . . . . . . . . . . . . . 10
SECTION 2.3. REPORTS BY THE PROPERTY TRUSTEE. . . . . . . . . . . . . . . . . . . 10
SECTION 2.4. PERIODIC REPORTS TO PROPERTY TRUSTEE . . . . . . . . . . . . . . . . 10
SECTION 2.5. EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT . . . . . . . . . . 11
SECTION 2.6. EVENTS OF DEFAULT; WAIVER. . . . . . . . . . . . . . . . . . . . . . 11
SECTION 2.7. EVENT OF DEFAULT; NOTICE . . . . . . . . . . . . . . . . . . . . . . 13

ARTICLE III

ORGANIZATION
SECTION 3.1. NAME . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 3.2. OFFICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 3.3. PURPOSE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 3.4. AUTHORITY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 3.5. TITLE TO PROPERTY OF THE TRUST . . . . . . . . . . . . . . . . . . . 15
SECTION 3.6. POWERS AND DUTIES OF THE REGULAR TRUSTEES. . . . . . . . . . . . . . 15
SECTION 3.7. PROHIBITION OF ACTIONS BY THE TRUST AND THE TRUSTEES . . . . . . . . 18
SECTION 3.8. POWERS AND DUTIES OF THE PROPERTY TRUSTEE. . . . . . . . . . . . . . 19
SECTION 3.9. CERTAIN DUTIES AND RESPONSIBILITIES OF THE PROPERTY TRUSTEE. . . . . 21
SECTION 3.10. CERTAIN RIGHTS OF PROPERTY TRUSTEE. . . . . . . . . . . . . . . . . 23
SECTION 3.11. DELAWARE TRUSTEE. . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 3.12. EXECUTION OF DOCUMENTS. . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 3.13. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES. . . . . . . 25
SECTION 3.14. DURATION OF TRUST . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 3.15. MERGERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

i
<PAGE>

ARTICLE IV

SPONSOR
SECTION 4.1. SPONSOR'S PURCHASE OF COMMON SECURITIES. . . . . . . . . . . . . . . 27
SECTION 4.2. RESPONSIBILITIES OF THE SPONSOR. . . . . . . . . . . . . . . . . . . 28

ARTICLE V

TRUSTEES
SECTION 5.1. NUMBER OF TRUSTEES . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 5.2. DELAWARE TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 5.3. PROPERTY TRUSTEE; ELIGIBILITY. . . . . . . . . . . . . . . . . . . . 29
SECTION 5.4. CERTAIN QUALIFICATIONS OF REGULAR TRUSTEES AND DELAWARE TRUSTEE
GENERALLY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 5.5. REGULAR TRUSTEES . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 5.6. APPOINTMENT, REMOVAL AND RESIGNATION OF TRUSTEES . . . . . . . . . . 30
SECTION 5.7. VACANCIES AMONG TRUSTEES . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 5.8. EFFECT OF VACANCIES. . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 5.9. MEETINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 5.10. DELEGATION OF POWER . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 5.11. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS . . . . 33

ARTICLE VI

DISTRIBUTIONS
SECTION 6.1. DISTRIBUTIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

ARTICLE VII

ISSUANCE OF SECURITIES

SECTION 7.1. GENERAL PROVISIONS REGARDING SECURITIES. . . . . . . . . . . . . . . 34
SECTION 7.2. SUBORDINATION OF COMMON SECURITIES . . . . . . . . . . . . . . . . . 35
SECTION 7.3. EXECUTION AND AUTHENTICATION . . . . . . . . . . . . . . . . . . . . 35
SECTION 7.4. FORM AND DATING. . . . . . . . . . . . . . . . . . . . . . . . . . . 36
SECTION 7.5. PAYING AGENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

ARTICLE VIII

TERMINATION OF TRUST

SECTION 8.1. TERMINATION OF TRUST . . . . . . . . . . . . . . . . . . . . . . . . 37

ii
<PAGE>

ARTICLE IX

TRANSFER OF INTERESTS
SECTION 9.1. TRANSFER OF SECURITIES . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 9.2. TRANSFER OF CERTIFICATES . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 9.3. DEEMED SECURITY HOLDERS. . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 9.4. BOOK ENTRY INTERESTS . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 9.5. NOTICES TO CLEARING AGENCY . . . . . . . . . . . . . . . . . . . . . 41
SECTION 9.6. APPOINTMENT OF SUCCESSOR CLEARING AGENCY . . . . . . . . . . . . . . 41
SECTION 9.7. DEFINITIVE PREFERRED SECURITY CERTIFICATES UNDER CERTAIN
CIRCUMSTANCES. . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 9.8. MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES. . . . . . . . . . 42

ARTICLE X

LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1. LIABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 10.2. EXCULPATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 10.3. FIDUCIARY DUTY. . . . . . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 10.4. INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 10.5. OUTSIDE BUSINESS. . . . . . . . . . . . . . . . . . . . . . . . . . 48

ARTICLE XI

ACCOUNTING
SECTION 11.1. FISCAL YEAR . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 11.2. CERTAIN ACCOUNTING MATTERS. . . . . . . . . . . . . . . . . . . . . 49
SECTION 11.3. BANKING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 11.4. WITHHOLDING . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49

ARTICLE XII

AMENDMENTS AND MEETINGS
SECTION 12.1. AMENDMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 12.2. MEETINGS OF THE HOLDERS OF SECURITIES; ACTION BY WRITTEN CONSENT. . 53

ARTICLE XIII

REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1. REPRESENTATIONS AND WARRANTIES OF PROPERTY TRUSTEE. . . . . . . . . 54
SECTION 13.2. REPRESENTATIONS AND WARRANTIES OF DELAWARE TRUSTEE. . . . . . . . . 55

iii
<PAGE>

ARTICLE XIV

MISCELLANEOUS
SECTION 14.1. NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 14.2. GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 14.3. INTENTION OF THE PARTIES. . . . . . . . . . . . . . . . . . . . . . 58
SECTION 14.4. HEADINGS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 14.5. SUCCESSORS AND ASSIGN . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 14.6. PARTIAL ENFORCEABILITY. . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 14.7. COUNTERPARTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . 58

</TABLE>

iv
<PAGE>

CROSS-REFERENCE TABLE*

Section of
Trust Indenture Act Section of
of 1939, as amended Declaration
- ------------------- -----------
<S> <C>
310(b). . . . . . . . . . . . . . . . . . . . . . . . . . 5.3(c) & (d)
311(a). . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(b)
311(b). . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(b)
312(b). . . . . . . . . . . . . . . . . . . . . . . . . . 2.2(b)
313 . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3
313(d). . . . . . . . . . . . . . . . . . . . . . . . . . 2.3
314 . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4
314(a). . . . . . . . . . . . . . . . . . . . . . . . . . 3.6(j)
314(c). . . . . . . . . . . . . . . . . . . . . . . . . . 2.5
316(a). . . . . . . . . . . . . . . . . . . . . . . . . . 2.6(a)- (c) &(e)
317(b). . . . . . . . . . . . . . . . . . . . . . . . . . 3.8(h)
</TABLE>

- --------------------

* This Cross-Reference table does not constitute part of the Declaration and
shall not affect the interpretation of any of its terms or provisions.

<PAGE>

FORM OF
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
UNIONBANCAL FINANCE TRUST I

____________ ___, ____

AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration") dated and
effective as of ____________ ____, _____, by the Trustees (as defined
herein), the Sponsor (as defined herein) and by the holders, from time to
time, of undivided beneficial interests in the Trust to be issued pursuant to
this Declaration;

WHEREAS, the Trustees and the Sponsor established UnionBanCal Finance
Trust(2) (the "Trust"), a trust under the Delaware Business Trust Act
pursuant to a Declaration of Trust dated as of November 17, 1998, (the
"Original Declaration"), and a Certificate of Trust filed with the Secretary
of State of the State of Delaware on November 17, 1998, for the sole purpose
of issuing and selling certain securities representing undivided beneficial
interests in the assets of the Trust and investing the proceeds thereof in
certain Debt Securities (as defined herein) of the Debt Security Issuer (as
defined herein);

WHEREAS, as of the date hereof, no interests in the Trust have been
issued; and

WHEREAS, all of the Trustees and the Sponsor, by this Declaration,
amend and restate each and every term and provision of the Original
Declaration;

NOW, THEREFORE, it being the intention of the parties hereto to
continue the Trust as a business trust under the Delaware Business Trust Act
and that this Declaration constitutes the governing instrument of such
business trust, the Trustees declare that all assets contributed to the Trust
will be held in trust for the benefit of the holders, from time to time, of
the securities representing undivided beneficial interests in the assets of
the Trust issued hereunder, subject to the provisions of this Declaration.

ARTICLE I

INTERPRETATION AND DEFINITIONS

SECTION 1.1. DEFINITIONS.

- -------------------------

(2) Insert I, II, III or IV as applicable.

<PAGE>

Unless the context otherwise requires:

(a) Capitalized terms used in this Declaration but not defined in
the preamble above have the respective meanings assigned to them in this
Section 1.1;

(b) a term defined anywhere in this Declaration has the same
meaning throughout;

(c) all references to "the Declaration" or "this Declaration" are
to this Declaration as modified, supplemented or amended from time to time;

(d) all references in this Declaration to Articles and Sections and
Annexes and Exhibits are to Articles and Sections of and Annexes and Exhibits
of or to this Declaration unless otherwise specified;

(e) a term defined in the Trust Indenture Act has the same meaning
when used in this Declaration unless otherwise defined in this Declaration or
unless the context otherwise requires; and

(f) a reference to the singular includes the plural and vice versa.

"90 Day Period" has the meaning specified in Annex I.

"Administrative Action" has the meaning specified in Annex I.

"Affiliate" has the same meaning as given to that term in Rule 405 of
the Securities Act or any successor rule thereunder.

"Agent" means any Paying Agent [or Conversion Agent](3)

"Authorized Officer" of a Person means any Person that is authorized
to bind such Person.

"Book Entry Interest" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained and made
through book entries by a Clearing Agency as described in Section 9.4.

"Business Day" means any day other than a Saturday, Sunday or any
other day on which banking institutions in New York, New York or Wilmington,
Delaware are permitted or required by any applicable law to close.

- ----------------------

(3) Bracketed language relating to conversion to be inserted throughout the
document if the Securities are convertible. This form assumes conversion
into common stock of the Sponsor. The Securities could, however, be
convertible into some other security.

2
<PAGE>

"Business Trust Act" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. Code Section 3801 ET SEQ., as it may be amended from time to
time, or any successor legislation.

"Certificate" means a Common Security Certificate or a Preferred
Security Certificate.

"Change in 1940 Act Law" shall have the meaning specified in Annex I.

"Clearing Agency" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is acting as
depositary for the Preferred Securities and in whose name or in the name of a
nominee of that organization shall be registered a Global Certificate and
which shall undertake to effect book entry transfers and pledges of the
Preferred Securities.

"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the Clearing
Agency effects book entry transfers and pledges of securities deposited with
the Clearing Agency.

"Closing Date" means ___________ ___, _____.

"Closing Price" has the meaning specified in Annex I.

"Code" means the Internal Revenue Code of 1986, as amended from time
to time, or any successor legislation.

"Commission" means the Securities and Exchange Commission.

"Common Securities Guarantee" means the guarantee agreement to be
dated as of ________ ___, ______ of the Sponsor in respect of the Common
Securities.

"Common Security" has the meaning specified in Section 7.1.

"Common Security Certificate" means a definitive certificate in fully
registered form representing a Common Security substantially in the form of
Exhibit A-2.

["Common Stock" means the common stock of UnionBanCal Corporation, a
California corporation, and any other shares of common stock as may constitute
"Common Stock" under the Indenture.]

"Company Indemnified Person" means (a) any Regular Trustee; (b) any
Affiliate of any Regular Trustee; (c) any officers, directors, shareholders,
members, partners, employees, representatives or agents of any Regular
Trustee; or (d) any officer, employee or agent of the Trust or its Affiliates.

3
<PAGE>

["Conversion Agent" has the meaning specified in Section 7.4.]

["Conversion Date" has the meaning specified in Annex I.]

["Conversion Price" has the meaning specified in Annex I.]

["Conversion Request" has the meaning specified in Annex I.]

"Corporate Trust Office" means the office of the Property Trustee at
which the corporate trust business of the Property Trustee shall, at any
particular time, be principally administered, which office at the date of
execution of this Agreement is located at

The First National Bank of Chicago
One First National Plaza, Suite 0126
Chicago, IL 60670-0126
Attention: Corporate Trust Services Division

"Coupon Rate" has the meaning specified in Annex I.

"Covered Person" means: (a) any officer, director, shareholder, partner,
member, representative, employee or agent of (i) the Trust or (ii) the Trust's
Affiliates; and (b) any Holder of Securities.

"Debt Securities" means the series of Debt Securities to be issued by the
Debt Security Issuer under the Indenture to be held by the Property Trustee, a
specimen certificate for such series of Debt Securities being Exhibit B.

"Debt Security Issuer" means UnionBanCal Corporation, a California
corporation, in its capacity as issuer of the Debt Securities under the
Indenture.

"Debt Security Trustee" means The First National Bank of Chicago, as
trustee under the Indenture until a successor is appointed thereunder, and
thereafter means such successor trustee.

"Declaration" has the meaning set forth in the recitals.

"Delaware Trustee" has the meaning set forth in Section 5.1.

"Definitive Preferred Security Certificates" has the meaning set forth in
Section 9.4.

"Depositary" has the meaning specified in Annex I.

"Distribution" means a distribution payable to Holders of Securities in
accordance with Section 6.1.

4
<PAGE>

"DTC" means The Depository Trust Company, the initial Clearing Agency.

"Event of Default" in respect of the Securities means an Event of Default
(as defined in the Indenture) has occurred and is continuing in respect of the
Debt Securities.

"Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time, or any successor legislation.

"Extension Period" has the meaning specified in Annex I.

"Fiscal Year" has the meaning set forth in Section 11.1

"Fiduciary Indemnified Person" has the meaning set forth in Section
10.4(b).

"Global Certificate" has the meaning set forth in Section 9.4(a).

"Holder" means a Person in whose name a Security is registered, such
Person being a beneficial owner within the meaning of the Business Trust Act.

"Indemnified Person" means each Company Indemnified Person and each
Fiduciary Indemnified Person.

"Indenture" means the Indenture dated as of __________ ____, ____ between
the Debt Security Issuer and The First National Bank of Chicago, as trustee, or,
if amended or supplemented as provided therein, as so amended or supplemented or
both, and shall include the forms and terms of a particular series of securities
established as contemplated thereunder.

"Investment Company" means an investment company as defined in the
Investment Company Act.

"Investment Company Act" means the Investment Company Act of 1940, as
amended from time to time, or any successor legislation.

"Investment Company Event" has the meaning set forth in Annex I hereto.

"Legal Action" has the meaning set forth in Section 3.6(g).

"Like Amount" means (1) with respect to a redemption of Securities having
an aggregate Liquidation Amount equal to that portion of the principal amount of
Debt Securities to be contemporaneously redeemed in accordance with the
Indenture, allocated to the Common Securities and to the Preferred Securities
based upon the relative Liquidation Amounts of such classes and (2) with respect
to a distribution of Debt Securities to Holders of Securities in connection with
a dissolution or liquidation of the Trust, Debt Securities having an aggregate

5
<PAGE>

principal amount equal to the aggregate Liquidation Amount of the Securities
of the Holder to whom such Debt Securities are distributed.

"Liquidation" has the meaning specified in Annex I.

"Liquidation Amount" means the stated amount of $___ per Preferred
Security.

"Liquidated Distribution" has the meaning specified in the terms of
the Securities as set forth in Annex I.

"List of Holders" has the meaning set forth in Section 2.2(a)

"OID" has the meaning specified in Annex I.

"Original Declaration" has the meaning set forth in the recitals.

"Majority in liquidation amount of the Securities" means, except as
provided in the terms of the Preferred Securities or by the Trust Indenture
Act, Holder(s) of outstanding Securities voting together as a single class
or, as the context may require, Holders of outstanding Preferred Securities
or Holders of outstanding Common Securities voting separately as a class, who
are the record owners of more than 50% of the aggregate liquidation amount
(including the stated amount that would be paid on redemption, liquidation or
otherwise, plus accumulated and unpaid Distributions to the date upon which
the voting percentages are determined) of all outstanding Securities of the
relevant class.

"Ministerial Action" has the meaning set forth in the terms of the
Securities as set forth in Annex I.

"Offered Securities" means the Preferred Securities, the Preferred
Securities Guarantee, the Debt Securities[, the shares of Common Stock issuable
upon conversion of the Preferred Securities].

"Officers' Certificate" means, with respect to any Person, a
certificate signed by two Authorized Officers of such Person. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Declaration shall include:

(a) a statement that each officer signing the Certificate has read
the covenant or condition and the definitions relating thereto;

(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Certificate;

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(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant or
condition has been complied with; and

(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.

"Option Closing Date" means the date of closing of any sale of any
securities issued pursuant to an over-allotment option.

"Paying Agent" has the meaning specified in Section 3.8(h).

"Payment Amount" has the meaning set forth in Section 6.1.

"Person" means any individual, corporation, estate, partnership, joint
venture, association, joint stock company, limited liability company, trust,
unincorporated association, or government or any agency or political
subdivision thereof, or any other entity of whatever nature.

"Preferred Securities Guarantee" means the guarantee agreement to be
dated as of ___________ ___, ______, of the Sponsor in respect of the
Preferred Securities.

"Preferred Security" has the meaning specified in Section 7.1.

"Preferred Security Beneficial Owner" means, with respect to a Book
Entry Interest, a Person who is the beneficial owner of such Book Entry
Interest, as reflected on the books of the Clearing Agency, or on the books
of a Person maintaining an account with such Clearing Agency (directly as a
Clearing Agency Participant or as an indirect participant, in each case in
accordance with the rules of such Clearing Agency).

"Preferred Security Certificate" means a certificate representing a
Preferred Security substantially in the form of Exhibit A-1.

"Property Trustee" means the Trustee meeting the eligibility
requirements set forth in Section 5.3.

"Property Trustee Account" has the meaning set forth in Section 3.8(c).

"Pro Rata" has the meaning specified in Annex I.

"Quorum" means a majority of the Regular Trustees or, if there are
only two Regular Trustees, both of them.

"Redemption/Distribution Notice"has the meaning specified in Annex I.

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"Redemption Price" has the meaning specified in Annex I.

"Regular Trustee" has the meaning set forth in Section 5.1.

"Regulatory Capital Event" has the meaning specified in Annex I.

"Related Party" means, with respect to the Sponsor, any direct or
indirect wholly owned subsidiary of the Sponsor or any other Person that
owns, directly or indirectly, 100% of the outstanding voting securities of
the Sponsor.

"Responsible Officer" means, with respect to the Property Trustee, any
officer within the Corporate Trust Office of the Property Trustee, including
any vice president, any assistant vice president, any assistant secretary,
the treasurer, any assistant treasurer or other officer of the Corporate
Trust Office of the Property Trustee customarily performing functions similar
to those performed by any of the above designated officers and also means,
with respect to a particular corporate trust matter, any other officer to
whom such matter is referred because of that officer's knowledge of and
familiarity with the particular subject.

"Rule 3a-5" means Rule 3a-5 under the Investment Company Act or any
successor rule.

"Securities" means the Common Securities and the Preferred Securities.

"Securities Act" means the Securities Act of 1933, as amended from
time to time, or any successor legislation.

"Securities Guarantees" means the Common Securities Guarantee and the
Preferred Securities Guarantee.

"Special Event" has the meaning set forth in Annex I hereto.

"Sponsor" or "UNBC" means UnionBanCal Corporation, a California
corporation, or any successor entity in a merger, consolidation or
amalgamation, in its capacity as sponsor of the Trust.

"Super Majority" has the meaning set forth in Section 2.6(a)(ii).

"Successor Delaware Trustee" has the meaning set forth in Section
5.6(b)

"Successor Entity" has the meaning set forth in Section 3.15(b)

"Successor Securities" has the meaning set forth in Section 3.15(b)

"Tax Event" has the meaning set forth in Annex I hereto.

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"Tax Opinion" has the meaning set forth in Annex I hereto.

"Treasury Regulations" means the income tax regulations, including
temporary and proposed regulations, promulgated under the Code by the United
States Treasury.

"Trust" has the meaning set forth in the recitals.

"Trustee" or "Trustees" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue in office in
accordance with the terms hereof, and all other Persons who may from time to
time be duly appointed, qualified and serving as Trustees in accordance with
the provisions hereof, and references herein to a Trustee or the Trustees
shall refer to such Person or Persons solely in their capacity as trustees
hereunder.

"Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended from time to time, or any successor legislation.

"Trust Property" means (i) the Debt Securities, (ii) any cash on
deposit in, or owing to, the Property Trustee Account and (iii) all proceeds
and rights in respect of the foregoing to be held by the Property Trustee
pursuant to the terms of this Declaration for the benefit of the
Securityholders.

"25% in liquidation amount of the Securities" means, except as
provided in the terms of the Preferred Securities or by the Trust Indenture
Act, Holder(s) of outstanding Securities voting together as a single class
or, as the context may require, Holders of outstanding Preferred Securities
or Holders of outstanding Common Securities voting separately as a class, who
are the record owners of 25% or more of the aggregate liquidation amount
(including the stated amount that would be paid on redemption, liquidation or
otherwise, plus accumulated and unpaid Distributions to the date upon which
the voting percentages are determined) of all outstanding Securities of the
relevant class.

"Underwriting Agreement" means the Underwriting Agreement for the
offering and sale of Preferred Securities in the form of Exhibit C.

ARTICLE II

TRUST INDENTURE ACT

SECTION 2.1. TRUST INDENTURE ACT: APPLICATION.

(a) This Declaration is subject to the provisions of the Trust
Indenture Act that are required to be part of this Declaration and shall, to
the extent applicable, be governed by such

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provisions. The Trust Indenture Act shall be applicable to this Declaration
except as otherwise set forth herein, as if the Securities had been sold
pursuant to an effective registration statement.

(b) The Property Trustee shall be the only Trustee which is a
Trustee for the purposes of the Trust Indenture Act.

(c) If, and to the extent that, any provision of this Declaration
limits, qualifies or conflicts with the duties imposed by Sections 310 to
317, inclusive, of the Trust Indenture Act, such duties imposed under the
Trust Indenture Act shall control.

(d) The application of the Trust Indenture Act to this Declaration
shall not affect the nature of the Securities as equity securities
representing undivided beneficial interests in the assets of the Trust.

SECTION 2.2. LISTS OF HOLDERS OF SECURITIES.

(a) Each of the Sponsor and the Regular Trustees on behalf of the
Trust shall provide the Property Trustee (i) within 14 days after each record
date for payment of Distributions, a list in such form as the Property
Trustee may reasonably require of the names and addresses of the Holders of
the Securities ("List of Holders") as of such record date, PROVIDED THAT,
neither the Sponsor nor the Regular Trustees on behalf of the Trust shall be
obligated to provide such List of Holders at any time the List of Holders
does not differ from the most recent List of Holders given to the Property
Trustee by the Sponsor and the Regular Trustees on behalf of the Trust, and
(ii) at any other time, within 30 days of receipt by the Trust of a written
request for a List of Holders as of a date no more than 14 days before such
List of Holders is given to the Property Trustee. The Property Trustee shall
preserve, in as current a form as is reasonably practicable, all information
contained in the Lists of Holders given to it or which it receives in the
capacity as Paying Agent (if acting in such capacity), PROVIDED THAT, the
Property Trustee may destroy any List of Holders previously given to it on
receipt of a new List of Holders.

(b) The Property Trustee shall comply with its obligations under
Sections 311(a), 311(b) and 312(b) of the Trust Indenture Act.

SECTION 2.3. REPORTS BY THE PROPERTY TRUSTEE.

Within 60 days after May 15 of each year, the Property Trustee shall
provide to the Holders of the Preferred Securities such reports as are
required by Section 313 of the Trust Indenture Act, if any, in the form and
in the manner provided by Section 313 of the Trust Indenture Act. The
Property Trustee shall also comply with the requirements of Section 313(d) of
the Trust Indenture Act.

SECTION 2.4. PERIODIC REPORTS TO PROPERTY TRUSTEE.

<PAGE>

Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide to the Property Trustee such documents, reports and information
as required by Section 314 (if any) and the compliance certificate required
by Section 314 of the Trust Indenture Act in the form, in the manner and at
the times required by Section 314 of the Trust Indenture Act.

Delivery of such reports, information and documents to the Property
Trustee is for informational purposes only and the Property Trustee's receipt
of such shall not constitute constructive notice of any information contained
therein or determinable from information contained therein, including the
Sponsor's compliance with any of its covenants hereunder (as to which the
Property Trustee is entitled to rely exclusively on Officers' Certificates).

SECTION 2.5. EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.

Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide to the Property Trustee such evidence of compliance with any
conditions precedent, if any, provided for in this Declaration that relate to
any of the matters set forth in Section 314(c) of the Trust Indenture Act.
Any certificate or opinion required to be given by an officer pursuant to
Section 314(c)(1) may be given in the form of an Officers' Certificate.

SECTION 2.6. EVENTS OF DEFAULT; WAIVER.

(a) The Holders of a Majority in liquidation amount of Preferred
Securities may by vote on behalf of the Holders of all of the Preferred
Securities, waive any past Event of Default in respect of the Preferred
Securities and its consequences, PROVIDED THAT, if the underlying Event of
Default under the Indenture:

(i) is not waivable under the Indenture, the Event of Default
under the Declaration shall also not be waivable; or

(ii) requires the consent or vote of greater than a majority in
principal amount of the holders of the Debt Securities (a "Super
Majority") to be waived under the Indenture, the Event of Default under
the Declaration may only be waived by the vote of the Holders of at least
the proportion in liquidation amount of the Preferred Securities that the
relevant Super Majority represents of the aggregate principal amount of
the Debt Securities outstanding.

The foregoing provisions of this Section 2.6(a) shall be in lieu of
Section 316(a)(1)(B) of the Trust Indenture Act and such Section 316(a)(1)(B)
of the Trust Indenture Act is hereby expressly excluded from this Declaration
and the Securities, as permitted by the Trust Indenture Act. Upon such
waiver, any such default shall cease to exist, and any Event of Default with
respect to the Preferred Securities arising therefrom shall be deemed to have
been cured, for every purpose of this Declaration, but no such waiver shall
extend to any subsequent or other default or an Event of Default with respect
to the Preferred Securities or impair any right consequent thereon. Any

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<PAGE>

waiver by the Holders of the Preferred Securities of an Event of Default
with respect to the Preferred Securities shall also be deemed to constitute a
waiver by the Holders of the Common Securities of any such Event of Default
with respect to the Common Securities for all purposes of this Declaration
without any further act, vote, or consent of the Holders of the Common
Securities.

(b) The Holders of a Majority in liquidation amount of the Common
Securities may, by vote, on behalf of the Holders of all of the Common
Securities, waive any past Event of Default with respect to the Common
Securities and its consequences, PROVIDED THAT, if the underlying Event of
Default under the Indenture:

(i) is not waivable under the Indenture, except where the
Holders of the Common Securities are deemed to have waived such Event of
Default under the Declaration as provided below in this Section 2.6(b),
the Event of Default under the Declaration shall also not be waivable; or

(ii) requires the consent or vote of a Super Majority to be
waived, except where the Holders of the Common Securities are deemed to
have waived such Event of Default under the Declaration as provided below
in this Section 2.6(b), the Event of Default under the Declaration may
only be waived by the vote of the Holders of at least the proportion in
liquidation amount of the Common Securities that the relevant Super
Majority represents of the aggregate principal amount of the Debt
Securities outstanding;

PROVIDED FURTHER, that each Holder of Common Securities will be deemed to
have waived any such Event of Default and all Events of Default with respect
to the Common Securities and its consequences until all Events of Default
with respect to the Preferred Securities have been cured, waived or otherwise
eliminated, and until such Events of Default have been so cured, waived or
otherwise eliminated, the Property Trustee shall act solely on behalf of the
Holders of the Preferred Securities and only the Holders of the Preferred
Securities will have the right to direct the Property Trustee to act in
accordance with the terms of the Securities. The foregoing provisions of
this Section 2.6(b) shall be in lieu of Sections 316(a)(1)(A) and
316(a)(1)(B) of the Trust Indenture Act and such Sections 316(a)(1)(A) and
316(a)(1)(B) of the Trust Indenture Act are hereby expressly excluded from
this Declaration and the Securities, as permitted by the Trust Indenture Act.
Subject to the foregoing provisions of this Section 2.6(b), upon such
waiver, any such default shall cease to exist and any Event of Default with
respect to the Common Securities arising therefrom shall be deemed to have
been cured for every purpose of this Declaration, but no such waiver shall
extend to any subsequent or other default or Event of Default with respect to
the Common Securities or impair any right consequent thereon.

(c) A waiver of an Event of Default under the Indenture by the
Property Trustee at the direction of the Holders of the Preferred Securities,
constitutes a waiver of the corresponding Event of Default under this
Declaration. The foregoing provisions of this Section 2.6(c) shall be in
lieu of Section 316(a)(1)(B) of the Trust Indenture Act and such Section
316(a)(1)(B) of the Trust

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Indenture Act is hereby expressly excluded from this Declaration and the
Securities, as permitted by the Trust Indenture Act.

SECTION 2.7. EVENT OF DEFAULT; NOTICE.

(a) The Property Trustee shall, within 90 days after the occurrence
of an Event of Default actually known to a Responsible Officer of the
Property Trustee, transmit by mail, first class postage prepaid, to the
Holders of the Securities, notices of all such defaults with respect to the
Securities unless such defaults have been cured before the giving of such
notice (the term "defaults" for the purposes of this Section 2.7(a) being
hereby defined to be an Event of Default as defined in the Indenture, not
including any periods of grace provided for therein and irrespective of the
giving of any notice provided therein); PROVIDED THAT, except for a default
in the payment of principal of (or premium, if any) or interest on any of the
Debt Securities or in the payment of any sinking fund installment established
for the Debt Securities, the Property Trustee shall be protected in
withholding such notice if and so long as a Responsible Officer of the
Property Trustee in good faith determines that the withholding of such notice
is in the interests of the Holders of the Securities. Any such notice given
pursuant to this Section 2.7(a) shall state that an Event of Default under
the Indenture also constitutes an Event of Default under this Declaration.

(b) The Property Trustee shall not be deemed to have knowledge of
any default except:

(i) a default under Sections 5.1(a) and 5.1(b) of the
Indenture; or

(ii) any default as to which the Property Trustee shall have
received written notice or of which a Responsible Officer of the Property
Trustee charged with the administration of the Declaration shall have
actual knowledge.

ARTICLE III

ORGANIZATION

SECTION 3.1. NAME.

The Trust is named "UnionBanCal Finance Trust /(4)/" as such name may
be modified from time to time by the Regular Trustees following written
notice to the Holders of Securities. The Trust's activities may be conducted
under the name of the Trust or any other name deemed advisable by the Regular
Trustees.

- --------------------

(4) Insert I, II, III or IV as applicable.

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SECTION 3.2. OFFICE.

The address of the principal office of the Trust is c/o UnionBanCal
Corporation, 400 California Street, San Francisco, CA, 94104. On at least
ten Business Days written notice to the Holders of Securities, the Regular
Trustees may designate another principal office.

SECTION 3.3. PURPOSE.

The exclusive purposes and functions of the Trust are (a) to issue and
sell Securities and use the proceeds from such sale to acquire the Debt
Securities, and (b) except as otherwise limited herein, to engage in only
those other activities necessary, or incidental thereto. The Trust shall not
borrow money, issue debt or reinvest proceeds derived from investments,
pledge any of its assets, or otherwise undertake (or permit to be undertaken)
any activity that would cause the Trust not to be classified for United
States federal income tax purposes as a grantor trust.

SECTION 3.4. AUTHORITY.

(a) Subject to the limitations provided in this Declaration and to
the specific duties of the Property Trustee, the Regular Trustees shall have
exclusive and complete authority to carry out the purposes of the Trust. An
action taken by the Regular Trustees in accordance with their powers shall
constitute the act of and serve to bind the Trust and an action taken by the
Property Trustee on behalf of the Trust in accordance with its powers shall
constitute the act of and serve to bind the Trust. In dealing with the
Trustees acting on behalf of the Trust, no person shall be required to
inquire into the authority of the Trustees to bind the Trust. Persons
dealing with the Trust are entitled to rely conclusively on the power and
authority of the Trustees as set forth in this Declaration.

(b) Except as expressly set forth in this Declaration and except if
a meeting of the Regular Trustees is called with respect to any matter over
which the Regular Trustees have power to act, any power of the Regular
Trustees may be exercised by, or with the consent of, any one such Regular
Trustee.

(c) Unless otherwise determined by the Regular Trustees, and except
as otherwise required by the Business Trust Act or applicable law, any
Regular Trustee is authorized to execute on behalf of the Trust any documents
which the Regular Trustees have the power and authority to cause the Trust to
execute pursuant to Section 3.6, PROVIDED, that the registration statement
referred to in Section 3.6, including any amendments thereto, shall, subject
to Section 3.4(d), be signed by all of the Regular Trustees; and

(d) A Regular Trustee may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his
or her power for the purposes of executing any documents which the Regular
Trustees have power and authority to cause the Trust to execute pursuant to
Section 3.6.

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SECTION 3.5. TITLE TO PROPERTY OF THE TRUST.

Except as provided in Section 3.8 with respect to the Debt Securities
and the Property Trustee Account or as otherwise provided in this
Declaration, legal title to all assets of the Trust shall be vested in the
Trust. The Holders of Securities shall not have legal title to any part of
the assets of the Trust, but shall have an undivided beneficial interest in
the assets of the Trust.

SECTION 3.6. POWERS AND DUTIES OF THE REGULAR TRUSTEES.

The Regular Trustees shall have the exclusive power, duty and
authority to cause the Trust to engage in the following activities:

(a) to issue and sell the Securities in accordance with this
Declaration; PROVIDED, HOWEVER, that the Trust may issue no more than one
series of Preferred Securities and no more than one series of Common
Securities, and PROVIDED FURTHER, that there shall be no interests in the
Trust other than the Securities, and the issuance of Securities shall be
limited to a simultaneous issuance of both Preferred Securities and Common
Securities on the Closing Date and Option Closing Date, if any;

(b) in connection with the issue and sale of the Securities, at the
direction of the Sponsor, to:

(i) execute and file with the Commission, at such time as
determined by the Sponsor, a registration statement on Form S-3 prepared
by the Sponsor, including any amendments thereto in relation to the
Preferred Securities;

(ii) execute and file an application, prepared by the Sponsor,
at such time as determined by the Sponsor, to the New York Stock Exchange
or any other national stock exchange for listing, or quotation on an
interdealer quotation system, of the Preferred Securities;

(iii) execute and deliver letters, documents, or instruments with
The Depository Trust Company relating to the Preferred Securities;

(iv) execute and file with the Commission, at such time as
determined by the Sponsor, a registration statement on Form 8-A,
including any amendments thereto, prepared by the Sponsor relating to the
registration of the Preferred Securities under Section 12(b) of the
Exchange Act;

(v) execute and enter into the Underwriting Agreement and other
related agreements providing for the sale of the Securities;

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<PAGE>

(vi) execute and file any documents prepared by the Sponsor, or
take any acts as determined by the Sponsor to be necessary in order to
qualify or register all or part of the Preferred Securities in any State
in which the Sponsor has determined to qualify or register such Preferred
Securities for sale or resale, as the case may be; and

(vii) take all actions and perform such duties as may be required
of the Regular Trustees to open checking, deposit or similar banking
accounts as may be necessary in connection with the issuance and sale of
the Securities;

(c) to acquire the Debt Securities with the proceeds of the sale of
the Preferred Securities and the Common Securities; PROVIDED, HOWEVER, that
the Regular Trustees shall cause legal title to the Debt Securities to be
held of record in the name of the Property Trustee for the benefit of the
Holders of the Preferred Securities and the Holders of Common Securities;

(d) to give the Sponsor and the Property Trustee prompt written
notice of the occurrence of a Special Event; PROVIDED THAT the Regular
Trustees shall consult with the Sponsor and the Property Trustee before
taking or refraining from taking any Ministerial Action in relation to a
Special Event;

(e) to establish a record date with respect to all actions to be
taken hereunder that require a record date be established, including and with
respect to, for the purposes of Section 316 (c) of the Trust Indenture Act,
Distributions, voting rights, redemptions and exchanges, and to issue
relevant notices to the Holders of Preferred Securities and Holders of Common
Securities as to such actions and applicable record dates;

(f) to take all actions and perform such duties as may be required
of the Regular Trustees pursuant to the terms of the Securities;

(g) to bring or defend, pay, collect, compromise, arbitrate, resort
to legal action, or otherwise adjust claims or demands of or against the
Trust ("Legal Action"), unless pursuant to Section 3.8(e), the Property
Trustee has the exclusive power to bring such Legal Action;

(h) to employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors, advisors and
consultants, and pay reasonable compensation for such services;

(i) to cause the Trust to comply with the Trust's obligations under
the Trust Indenture Act;

(j) to give the certificate required by Section 314(a)(4) of the
Trust Indenture Act to the Property Trustee, which certificate may be
executed by any Regular Trustee;

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(k) to incur expenses that are necessary or incidental to carry out
any of the purposes of the Trust;

(l) to act as, or appoint another Person to act as, registrar,
transfer agent, Paying Agent [and Conversion Agent] for the Securities;

(m) to give prompt written notice to the Holders of the Securities
of any notice received from the Debt Security Issuer of its election (i) to
defer payments of interest on the Debt Securities by extending the interest
payment period under the Indenture or (ii) to shorten the stated maturity of
the Debt Securities pursuant to the Indenture;

(n) to execute all documents or instruments, perform all duties and
powers, and do all things for and on behalf of the Trust in all matters
necessary or incidental to the foregoing;

(o) to take all action that may be necessary or appropriate for the
preservation and the continuation of the Trust's valid existence, rights,
franchises and privileges as a statutory business trust under the laws of the
State of Delaware and of each other jurisdiction in which such existence is
necessary to protect the limited liability of the Holders of the Preferred
Securities or to enable the Trust to effect the purposes for which the Trust
was created;

(p) to take any action, not inconsistent with this Declaration or
with applicable law, that the Regular Trustees determine in their discretion
to be necessary or desirable in carrying out the activities of the Trust as
set out in this Section 3.6, including, but not limited to:

(i) causing the Trust not to be deemed to be an Investment
Company required to be registered under the Investment Company Act;

(ii) causing the Trust to be classified for United States
federal income tax purposes as a grantor trust; and

(iii) cooperating with the Debt Security Issuer to ensure that
the Debt Securities will be treated as indebtedness of the Debt Security
Issuer for United States federal income tax purposes,

PROVIDED THAT such action does not adversely affect the interests of Holders
or vary the terms of the Preferred Securities;

(q) to take all action necessary to cause all applicable tax
returns and tax information reports that are required to be filed with
respect to the Trust to be duly prepared and filed by the Regular Trustees,
on behalf of the Trust;

(r) to take all actions and perform such duties as may be required
of the Regular Trustees pursuant to Section 11.2 herein; and

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<PAGE>

(s) to the extent provided in this Declaration, the winding up of
the affairs of and liquidation of the Trust and the preparation, execution
and filing of the Certificate of Cancellation with the Secretary of State of
the State of Delaware.

The Regular Trustees must exercise the powers set forth in this
Section 3.6 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.3, and the Regular Trustees shall not take any
action that is inconsistent with the purposes and functions of the Trust set
forth in Section 3.3.

Subject to this Section 3.6, the Regular Trustees shall have none of
the powers or the authority of the Property Trustee set forth in Section 3.8.

Any expenses incurred by the Regular Trustees pursuant to this Section
3.6 shall be reimbursed by the Sponsor.

The Trust initially appoints the Property Trustee as transfer agent
and registrar for the Preferred Securities.

SECTION 3.7. PROHIBITION OF ACTIONS BY THE TRUST AND THE TRUSTEES.

(a) The Trust shall not, and the Trustees (including the Property
Trustee) shall cause the Trust not to engage in any activity other than as
required or authorized by this Declaration. In particular the Trust shall
not and the Trustees (including the Property Trustee) shall cause the Trust
not to:

(i) invest any proceeds received by the Trust from holding the
Debt Securities, but shall distribute all such proceeds to Holders of
Securities pursuant to the terms of this Declaration and of the
Securities;

(ii) acquire any assets other than as expressly provided herein;

(iii) possess Trust property for other than a Trust purpose;

(iv) make any loans or incur any indebtedness other than loans
represented by the Debt Securities;

(v) possess any power or otherwise act in such a way as to vary
the Trust assets or the terms of the Securities in any way whatsoever
except as permitted by the terms of this Declaration;

(vi) issue any securities or other evidences of beneficial
ownership of, or beneficial interest in, the Trust other than the
Securities; or

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<PAGE>

(vii) other than as provided in this Declaration or Annex I
hereto, (A) direct the time, method and place of exercising any trust or
power conferred upon the Debt Security Trustee with respect to the Debt
Securities, (B) waive any past default that is not waivable under the
Indenture, (C) exercise any right to rescind or annul any declaration
that the principal of all the Debt Securities shall be due and payable,
or (D) consent to any amendment, modification or termination of the
Indenture or the Debt Securities where such consent shall be required
unless the Trust shall have received an opinion of counsel to the effect
that such modification will not cause more than an insubstantial risk
that (x) the Trust will be deemed an Investment Company required to be
registered under the Investment Company Act or (y) the Trust will not be
classified as a grantor trust for United States federal income tax
purposes .

SECTION 3.8. POWERS AND DUTIES OF THE PROPERTY TRUSTEE.

(a) The legal title to the Debt Securities shall be owned by and
held of record in the name of the Property Trustee (acting in such capacity)
for the benefit of the Trust and the Holders of the Securities. The right,
title and interest of the Property Trustee to the Debt Securities shall vest
automatically in each Person who may hereafter be appointed as Property
Trustee in accordance with Section 5.6. Such vesting and cessation of title
shall be effective whether or not conveyancing documents with regard to the
Debt Securities have been executed and delivered.

(b) The Property Trustee shall not transfer its right, title and
interest in the Debt Securities to the Regular Trustees or to the Delaware
Trustee (if the Property Trustee does not also act as Delaware Trustee).

(i) establish and maintain a segregated non-interest bearing
trust account (the "Property Trustee Account") in the name of and under
the exclusive control of the Property Trustee on behalf of the Holders of
the Securities and, upon the receipt of payments of funds made in respect
of the Debt Securities held by the Property Trustee, deposit such funds
into the Property Trustee Account and make payments to the Holders of the
Preferred Securities and Holders of the Common Securities from the
Property Trustee Account in accordance with Section 6.1. Funds in the
Property Trustee Account shall be held uninvested until disbursed in
accordance with this Declaration. The Property Trustee Account shall be
an account that is maintained with a banking institution the rating on
whose long-term unsecured indebtedness is at least equal to the rating
assigned to the Preferred Securities by a "nationally recognized
statistical rating organization," as that term is defined for purposes of
Rule 436(g)(2) under the Securities Act;

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<PAGE>

(ii) engage in such ministerial activities as shall be necessary
or appropriate to effect the redemption of the Preferred Securities and
the Common Securities to the extent the Debt Securities are redeemed or
mature;

(iii) engage in such ministerial activities as shall be necessary
or appropriate to effect the distribution of the Trust Property in
accordance with the terms of this Declaration; and

(iv) to the extent provided for in this Declaration, take such
ministerial actions necessary in connection with the winding up of the
affairs of and liquidation of the Trust and the preparation, execution
and filing of the Certificate of Cancellation with the Secretary of State
of the State of Delaware.

(d) The Property Trustee shall take all actions and perform such
duties as may be specifically required of the Property Trustee pursuant to
the terms of the Securities.

(e) The Property Trustee shall take any Legal Action which arises
out of or in connection with, an Event of Default of which a Responsible
Officer of the Property Trustee has actual knowledge, or the Property
Trustee's duties and obligations under this Declaration or the Trust
Indenture Act; PROVIDED HOWEVER, that if an Event of Default has occurred and
is continuing and such event is attributable to the failure of the Debt
Security Issuer to pay interest or principal on the Debt Securities on the
date such interest or principal is otherwise payable (or in the case of
redemption, on the redemption date), then a Holder of Preferred Securities
may directly institute a proceeding for enforcement of payment to such Holder
of the principal of or interest on the Debt Securities having a principal
amount equal to the aggregate liquidation amount of the Preferred Securities
of such Holder (a "Direct Action") on or after the respective due date
specified in the Debt Securities and PROVIDED, FURTHER, that if the Property
Trustee fails to enforce its rights under the Debt Securities, any Holder of
Preferred Securities may institute a legal proceeding against any person to
enforce the Property Trustee's rights under the Debt Securities. In
connection with such Direct Action, the rights of the Holders of the Common
Securities will be subrogated to the rights of such Holder of Preferred
Securities to the extent of any payment made by the Debt Security Issuer to
such Holder of Preferred Securities in such Direct Action. Except as
provided in the preceding sentences, the Holders of Preferred Securities will
not be able to exercise directly any other remedy available to the holders of
the Debt Securities.

(f) The Property Trustee shall continue to serve as a Trustee until
either:

(i) the Trust has been completely liquidated and the proceeds
of the liquidation distributed to the Holders of Securities pursuant to
the terms of the Securities; or

(ii) a Successor Property Trustee has been appointed and has
accepted that appointment in accordance with Section 5.6.

<PAGE>

(g) The Property Trustee shall have the legal power to exercise all
of the rights, powers and privileges of a holder of Debt Securities under the
Indenture and, if an Event of Default actually known to a Responsible Officer
of the Property Trustee occurs and is continuing, the Property Trustee shall,
for the benefit of Holders of the Securities, enforce its rights as holder of
the Debt Securities subject to the rights of the Holders pursuant to the
terms of such Securities.

(h) The Property Trustee may authorize one or more Persons (each, a
"Paying Agent") to pay Distributions, redemption payments or Liquidation
Distributions on behalf of the Trust with respect to all Securities and any
such Paying Agent shall comply with Section 317(b) of the Trust Indenture
Act. Any Paying Agent may be removed by the Property Trustee at any time and
a successor Paying Agent or additional Paying Agents may be appointed at any
time by the Property Trustee.

(i) Subject to this Section 3.8, the Property Trustee shall have
none of the duties, liabilities, powers or the authority of the Regular
Trustees set forth in Section 3.6.

The Property Trustee must exercise the powers set forth in this
Section 3.8 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.3, and the Property Trustee shall not take any
action that is inconsistent with the purposes and functions of the Trust set
out in Section 3.3.

SECTION 3.9. CERTAIN DUTIES AND RESPONSIBILITIES OF THE PROPERTY
TRUSTEE.

(a) The Property Trustee, before the occurrence of any Event of
Default and after the curing of all Events of Default that may have occurred,
shall undertake to perform only such duties as are specifically set forth in
this Declaration and no implied covenants shall be read into this Declaration
against the Property Trustee. In case an Event of Default has occurred (that
has not been cured or waived pursuant to Section 2.6) of which a Responsible
Officer of the Property Trustee has actual knowledge, the Property Trustee
shall exercise such of the rights and powers vested in it by this
Declaration, and use the same degree of care and skill in their exercise, as
a prudent person would exercise or use under the circumstances in the conduct
of his or her own affairs.

(b) No provision of this Declaration shall be construed to relieve
the Property Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:

(i) prior to the occurrence of an Event of Default and after
the curing or waiving of all such Events of Default that may have
occurred:

(A) the duties and obligations of the Property Trustee
shall be determined solely by the express provisions of this
Declaration and the Property

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Trustee shall not be liable except for the performance of such
duties and obligations as are specifically set forth in this
Declaration, and no implied covenants or obligations shall be
read into this Declaration against the Property Trustee; and

(B) in the absence of bad faith on the part of the
Property Trustee, the Property Trustee may conclusively rely, as
to the truth of the statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished to
the Property Trustee and conforming to the requirements of this
Declaration; but in the case of any such certificates or opinions
that by any provision hereof are specifically required to be
furnished to the Property Trustee, the Property Trustee shall be
under a duty to examine the same to determine whether or not they
conform to the requirements of this Declaration;

(ii) the Property Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the Property
Trustee, unless it shall be proved that the Property Trustee was
negligent in ascertaining the pertinent facts;

(iii) the Property Trustee shall not be liable with respect to
any action taken or omitted to be taken by it in good faith in accordance
with the direction of the Holders of not less than a Majority in
liquidation amount of the Securities relating to the time, method and
place of conducting any proceeding for any remedy available to the
Property Trustee, or exercising any trust or power conferred upon the
Property Trustee under this Declaration;

(iv) no provision of this Declaration shall require the Property
Trustee to expend or risk its own funds or otherwise incur personal
financial liability in the performance of any of its duties or in the
exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that the repayment of such funds or liability is
not reasonably assured to it under the terms of this Declaration or
indemnity reasonably satisfactory to the Property Trustee against such
risk or liability is not reasonably assured to it;

(v) the Property Trustee's sole duty with respect to the
custody, safe keeping and physical preservation of the Debt Securities
and the Property Trustee Account shall be to deal with such property in a
similar manner as the Property Trustee deals with similar property for
its own account, subject to the protections and limitations on liability
afforded to the Property Trustee under this Declaration and the Trust
Indenture Act;

(vi) the Property Trustee shall have no duty or liability for or
with respect to the value, genuineness, existence or sufficiency of the
Debt Securities or the payment of any taxes or assessments levied thereon
or in connection therewith;

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<PAGE>

(vii) the Property Trustee shall not be liable for any interest
on any money received by it except as it may otherwise agree in writing
with the Sponsor. Money held by the Property Trustee need not be
segregated from other funds held by it except in relation to the Property
Trustee Account maintained by the Property Trustee pursuant to Section
3.8(c)(i) and except to the extent otherwise required by law; and

(viii) the Property Trustee shall not be responsible for
monitoring the compliance by the Regular Trustees or the Sponsor with
their respective duties under this Declaration, nor shall the Property
Trustee be liable for any default or misconduct of the Regular Trustees
or the Sponsor.

SECTION 3.10. CERTAIN RIGHTS OF PROPERTY TRUSTEE.

(a) Subject to the provisions of Section 3.9:

(i) the Property Trustee may conclusively rely and shall be
fully protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document believed by it to be genuine and
to have been signed, sent or presented by the proper party or parties;

(ii) any direction or act of the Sponsor or the Regular Trustees
contemplated by this Declaration shall be sufficiently evidenced by an
Officers' Certificate;

(iii) whenever in the administration of this Declaration, the
Property Trustee shall deem it desirable that a matter be proved or
established before taking, suffering or omitting any action hereunder,
the Property Trustee (unless other evidence is herein specifically
prescribed) may, in the absence of bad faith on its part, request and
conclusively rely upon an Officers' Certificate which, upon receipt of
such request, shall be promptly delivered by the Sponsor or the Regular
Trustees;

(iv) the Property Trustee shall have no duty to see to any
recording, filing or registration of any instrument (including any
financing or continuation statement or any filing under tax or securities
laws) or any rerecording, refiling or registration thereof;

(v) the Property Trustee may consult with counsel of its
selection or other experts and the advice or opinion of such counsel and
experts with respect to legal matters or advice within the scope of such
experts' area of expertise shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in accordance with such advice or opinion.
Such counsel may be counsel to the Sponsor or any of its Affiliates, and
may include any of its employees. The Property Trustee shall have the
right at any time to seek instructions

23
<PAGE>

concerning the administration of this Declaration from any court of
competent jurisdiction;

(vi) the Property Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Declaration at
the request or direction of any Holder, unless such Holder shall have
provided to the Property Trustee security and indemnity, reasonably
satisfactory to the Property Trustee, against the costs, expenses
(including attorneys' fees and expenses and the expenses of the Property
Trustee's agents, nominees or custodians) and liabilities that might be
incurred by it in complying with such request or direction, including
such reasonable advances as may be requested by the Property Trustee
PROVIDED, that, nothing contained in this Section 3.10(a)(vi) shall be
taken to (a) require the Holders of Preferred Securities to offer such
indemnity in the event such Holders direct the Property Trustee to take
any action it is empowered to take under this Declaration following an
Event of Default or (b) relieve the Property Trustee, upon the occurrence
of an Event of Default, of its obligation to exercise the rights and
powers vested in it by this Declaration;

(vii) the Property Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Property Trustee, in its
discretion, may make such further inquiry or investigation into such
facts or matters as it may see fit;

(viii) the Property Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by or
through agents, custodians, nominees or attorneys and the Property
Trustee shall not be responsible for any misconduct or negligence on the
part of any agent or attorney appointed with due care by it hereunder;

(ix) any action taken by the Property Trustee or its agents
hereunder shall bind the Trust and the Holders of the Securities, and the
signature of the Property Trustee or its agents alone shall be sufficient
and effective to perform any such action and no third party shall be
required to inquire as to the authority of the Property Trustee to so act
or as to its compliance with any of the terms and provisions of this
Declaration, both of which shall be conclusively evidenced by the
Property Trustee's or its agent's taking such action;

(x) whenever in the administration of this Declaration the
Property Trustee shall deem it desirable to receive written instructions
with respect to enforcing any remedy or right or taking any other action
hereunder, the Property Trustee (i) may request written instructions from
the Holders of the Securities which instructions may only be given by the
Holders of the same proportion in liquidation amount of the Securities as
would be entitled to direct the Property Trustee under the terms of the
Securities in respect of such remedy, right or action, (ii) may refrain
from enforcing such remedy or right or taking

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<PAGE>

such other action until such instructions are received, and (iii) shall
be protected in conclusively relying on or acting in accordance with such
instructions;

(xi) except as otherwise expressly provided by this Declaration,
the Property Trustee shall not be under any obligation to take any action
that is discretionary under the provisions of this Declaration; and

(xii) the Property Trustee shall not be liable for any action
taken, suffered, or omitted to be taken by it in good faith and
reasonably believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Declaration.

(b) No provision of this Declaration shall be deemed to impose any
duty or obligation on the Property Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it, in
any jurisdiction in which it shall be illegal, or in which the Property
Trustee shall be unqualified or incompetent in accordance with applicable
law, to perform any such act or acts, or to exercise any such right, power,
duty or obligation. No permissive power or authority available to the
Property Trustee shall be construed to be a duty.

SECTION 3.11. DELAWARE TRUSTEE.

Notwithstanding any other provision of this Declaration other than
Section 5.2, the Delaware Trustee shall not be entitled to exercise any
powers, nor shall the Delaware Trustee have any of the duties and
responsibilities of the Regular Trustees, the Property Trustee or the
Trustees generally (except as may be required under the Business Trust Act)
described in this Declaration. Except as set forth in Section 5.2, the
Delaware Trustee shall be a Trustee for the sole and limited purpose of
fulfilling the requirements of Section 3807(a) of the Business Trust Act.

SECTION 3.12. EXECUTION OF DOCUMENTS.

Except as otherwise required by the Business Trust Act, any Regular
Trustee is authorized to execute on behalf of the Trust any documents that
the Regular Trustees have the power and authority to execute pursuant to
Section 3.6; PROVIDED THAT, the registration statement referred to in Section
3.6(b)(i), including any amendments thereto, shall, subject to Section
3.4(d), be signed by all of the Regular Trustees.

SECTION 3.13. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.

The recitals contained in this Declaration and the Securities shall be
taken as the statements of the Sponsor, and the Trustees do not assume any
responsibility for their correctness. The Trustees make no representations
as to the value or condition of the property of the Trust or any part
thereof. The Trustees make no representations as to the validity or
sufficiency of this Declaration or the Securities.

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<PAGE>

SECTION 3.14. DURATION OF TRUST.

The Trust, unless terminated pursuant to the provisions of Article
VIII hereof, shall have existence for _________ (__) years from __________
___, _____.

SECTION 3.15. MERGERS.

(a) The Trust may not consolidate, amalgamate, merge with or into,
or be replaced by, or convey, transfer or lease its properties and assets as
an entirety or substantially as an entirety to any corporation or other body,
except as described in Section 3.15(b) and (c).

(b) The Trust may, with the consent of the Regular Trustees or, if
there are more than two, a majority of the Regular Trustees and without the
consent of the Holders of the Securities, the Delaware Trustee or the
Property Trustee, consolidate, amalgamate, merge with or into, or be replaced
by a trust organized as such under the laws of any State; PROVIDED that

(i) such successor entity (the "Successor Entity") either:

(A) expressly assumes all of the obligations of the
Trust under the Securities; or

(B) substitutes for the Preferred Securities other
securities having substantially the same terms as the Preferred
Securities (the "Successor Securities") so long as the Successor
Securities rank the same as the Preferred Securities rank with
respect to Distributions and payments upon liquidation, redemption
and otherwise;

(ii) the Preferred Securities or any Successor Securities are
listed, or any Successor Securities will be listed upon notification of
issuance, on any national securities exchange or another organization on
which the Preferred Securities are then listed;

(iii) the Debt Security Issuer expressly acknowledges a trustee
of the Successor Entity that possesses the same powers and duties as the
Property Trustee as the Holder of the Debt Securities;

(iv) such merger, consolidation, amalgamation or replacement
does not cause the Preferred Securities (including any Successor
Securities) to be downgraded by any nationally recognized statistical
rating organization;

(v) such merger, consolidation, amalgamation or replacement
does not adversely affect the rights, preferences and privileges of the
Holders of the Securities

26
<PAGE>

(including any Successor Securities) in any material respect (other than
with respect to any dilution of the Holders' interest in the Successor
Entity);

(vi) such Successor Entity has a purpose identical to that of
the Trust;

(vii) prior to such merger, consolidation, amalgamation or
replacement, the Sponsor has received an opinion of nationally recognized
independent counsel to the Trust experienced in such matters to the
effect that:

(A) such merger, consolidation, amalgamation or
replacement does not adversely affect the rights, preferences and
privileges of the Holders of the Securities (including any
Successor Securities) in any material respect (other than with
respect to any dilution of the Holders' interest in the Successor
Entity); and

(B) following such merger, consolidation, amalgamation
or replacement, neither the Trust nor the Successor Entity will be
required to register as an Investment Company; and

(viii) the Sponsor guarantees the obligations of the Successor
Entity under the Successor Securities at least to the extent provided by
the Securities Guarantees.

(c) Notwithstanding Section 3.15(b), the Trust shall not, except with
the consent of Holders of 100% in liquidation amount of the Securities,
consolidate, amalgamate, merge with or into, or be replaced by any other entity
or permit any other entity to consolidate, amalgamate, merge with or into, or
replace it, if such consolidation, amalgamation, merger or replacement would
cause the Trust or the Successor Entity to be classified as other than a grantor
trust for United States federal income tax purposes.

ARTICLE IV

SPONSOR

SECTION 4.1. SPONSOR'S PURCHASE OF COMMON SECURITIES.

On the Closing Date the Sponsor will purchase all of the Common
Securities issued by the Trust, in an amount at least equal to 3% of the
capital of the Trust, at the same time as the Preferred Securities are sold.

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<PAGE>

SECTION 4.2. RESPONSIBILITIES OF THE SPONSOR.

In connection with the issue and sale of the Preferred Securities, the
Sponsor shall have the exclusive right and responsibility to engage in the
following activities:

(a) prepare for filing by the Trust with the Commission a
registration statement on Form S-3 in relation to the Securities, including
any amendments thereto;

(b) prepare for execution and filing by the Trust of an
application, prepared by the Sponsor, at such time as determined by the
Sponsor, to the New York Stock Exchange or any other national stock exchange
for listing, or quotation on an interdealer quotation system, of the
Preferred Securities;

(c) prepare for execution and filing by the Trust of documents, or
instruments to be delivered to The Depository Trust Company relating to the
Preferred Securities;

(d) prepare for execution and filing by the Trust of a registration
statement on Form 8-A, including any amendments thereto, prepared by the
Sponsor relating to the registration of the Preferred Securities under
Section 12(b) of the Exchange Act;

(e) to determine the States in which to take appropriate action to
qualify or register for sale all or part of the Preferred Securities and to
do any and all such acts, other than actions which must be taken by the
Trust, and advise the Trust of actions it must take, and prepare for
execution and filing any documents to be executed and filed by the Trust, as
the Sponsor deems necessary or advisable in order to comply with the
applicable laws of any such States; and

(f) to negotiate the terms of the Underwriting Agreement providing
for the sale of the Preferred Securities.

ARTICLE V

TRUSTEES

SECTION 5.1. NUMBER OF TRUSTEES.

The number of Trustees initially shall be five (5), and:

(a) at any time before the issuance of any Securities, the Sponsor
may, by written instrument, increase or decrease the number of Trustees; and

(b) after the issuance of any Securities, the number of Trustees
may be increased or decreased by vote of the Holders of a majority in
liquidation amount of the Common Securities

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<PAGE>

voting as a class at a meeting of the Holders of the Common Securities;
PROVIDED, HOWEVER, that the number of Trustees shall in no event be less than
two (2); PROVIDED FURTHER, that (i) one Trustee, in the case of a natural
person, shall be a person who is a resident of the State of Delaware or that,
if not a natural person, is an entity which has its principal place of
business in the State of Delaware (the "Delaware Trustee"); (ii) there shall
be at least one Trustee who is any employee of, or is affiliated with the
Sponsor ( a "Regular Trustee"); and (iii) one Trustee shall be the Property
Trustee, and such Trustee may also serve as Delaware Trustee if it meets the
applicable requirements.

SECTION 5.2. DELAWARE TRUSTEE.

If required by the Business Trust Act, one Trustee shall be:

(a) a natural person who is a resident of the State of Delaware; or

(b) if not a natural person, an entity which has its principal
place of business in the State of Delaware, and otherwise meets the
requirements of applicable law;

PROVIDED THAT, if the Property Trustee has its principal place of business in
the State of Delaware and otherwise meets the requirements of applicable law,
then the Property Trustee shall also be the Delaware Trustee and Section 3.11
shall have no application.

The Initial Delaware Trustee shall be: First Chicago Delaware Inc.

SECTION 5.3. PROPERTY TRUSTEE; ELIGIBILITY.

(a) There shall at all times be one Trustee which shall act as
Property Trustee which shall:

(i) not be an Affiliate of the Sponsor; and

(ii) be a corporation organized and doing business under the
laws of the United States of America or any State or Territory thereof or
of the District of Columbia, or a corporation or Person permitted by the
Commission to act as an institutional trustee under the Trust Indenture
Act, authorized under such laws to exercise corporate trust powers,
having a combined capital and surplus of at least 50 million U.S. dollars
($50,000,000), and subject to supervision or examination by federal,
state, territorial or District of Columbia authority. If such
corporation publishes reports of condition at least annually, pursuant to
law or to the requirements of the supervising or examining authority
referred to above, then for the purposes of this Section 5.3(a)(ii), the
combined capital and surplus of such corporation shall be deemed to be
its combined capital and surplus as set forth in its most recent report
of condition so published.

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<PAGE>

(b) If at any time the Property Trustee shall cease to be eligible
to so act under Section 5.3(a), the Property Trustee shall immediately resign
in the manner and with the effect set forth in Section 5.6(c).

(c) If the Property Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act,
the Property Trustee and the Holder of the Common Securities (as if it were
the obligor referred to in Section 310(b) of the Trust Indenture Act) shall
in all respects comply with the provisions of Section 310(b) of the Trust
Indenture Act.

(d) The Preferred Securities Guarantee shall be deemed to be
specifically described in this Declaration for purposes of clause (i) of the
first provision contained in Section 310(b) of the Trust Indenture Act.

(e) The initial Property Trustee shall be: The First National Bank
of Chicago.

SECTION 5.4. CERTAIN QUALIFICATIONS OF REGULAR TRUSTEES AND DELAWARE
TRUSTEE GENERALLY.

Each Regular Trustee and the Delaware Trustee (unless the Property
Trustee also acts as Delaware Trustee) shall be either a natural person who
is at least 21 years of age or a legal entity that shall act through one or
more Authorized Officers.

SECTION 5.5. REGULAR TRUSTEES.

The initial Regular Trustees shall be:

_________________
_________________
_________________

(a) Except as expressly set forth in this Declaration and except if
a meeting of the Regular Trustees is called with respect to any matter over
which the Regular Trustees have power to act, any power of the Regular
Trustees may be exercised by, or with the consent of, any one such Regular
Trustee.

(b) Unless otherwise determined by the Regular Trustees, and except
as otherwise required by the Business Trust Act or applicable law, any
Regular Trustee is authorized to execute on behalf of the Trust any documents
which the Regular Trustees have the power and authority to cause the Trust to
execute pursuant to Section 3.6, PROVIDED, THAT, the registration statement
referred to in Section 3.6, including any amendments thereto, shall, subject
to Section 3.4(d), be signed by all of the Regular Trustees.

SECTION 5.6. APPOINTMENT, REMOVAL AND RESIGNATION OF TRUSTEES.

<PAGE>

(a) Subject to Section 5.6(b), Trustees may be appointed or removed
without cause at any time:

(i) until the issuance of any Securities, by written instrument
executed by the Sponsor; and

(ii) after the issuance of any Securities, by vote of the
Holders of a Majority in liquidation amount of the Common Securities
voting as a class at a meeting of the Holders of the Common Securities.
(b) (i) The Trustee that acts as Property Trustee shall not be
removed in accordance with Section 5.6(a) until a Successor Property Trustee has
been appointed and has accepted such appointment by written instrument executed
by such Successor Property Trustee and delivered to the Regular Trustees and the
Sponsor; and

(ii) the Trustee that acts as Delaware Trustee shall not be
removed in accordance with Section 5.6(a) until a successor Trustee
possessing the qualifications to act as Delaware Trustee under Sections
5.2 and 5.4 (a "Successor Delaware Trustee") has been appointed and has
accepted such appointment by written instrument executed by such
Successor Delaware Trustee and delivered to the Regular Trustees and the
Sponsor.

(c) A Trustee appointed to office shall hold office until his
successor shall have been appointed or until his death, removal or resignation.
Any Trustee may resign from office (without need for prior or subsequent
accounting) by an instrument in writing signed by the Trustee and delivered to
the Sponsor and the Trust, which resignation shall take effect upon such
delivery or upon such later date as is specified therein; PROVIDED, HOWEVER,
that:

(i) No such resignation of the Trustee that acts as the
Property Trustee shall be effective:

(A) until a Successor Property Trustee has been
appointed and has accepted such appointment by instrument executed
by such Successor Property Trustee and delivered to the Trust, the
Sponsor and the resigning Property Trustee; or

(B) until the assets of the Trust have been completely
liquidated and the proceeds thereof distributed to the holders of
the Securities; and

(ii) no such resignation of the Trustee that acts as the
Delaware Trustee shall be effective until a Successor Delaware Trustee
has been appointed and has accepted such appointment by instrument
executed by such Successor Delaware Trustee and delivered to the Trust,
the Sponsor and the resigning Delaware Trustee.

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<PAGE>

(d) The Holders of the Common Securities shall use their best efforts
to promptly appoint a Successor Delaware Trustee or Successor Property Trustee
as the case may be if the Property Trustee or the Delaware Trustee delivers an
instrument of resignation in accordance with this Section 5.6.

(e) If no Successor Property Trustee or Successor Delaware Trustee
shall have been appointed and accepted appointment as provided in this Section
5.6 within 60 days after delivery of an instrument of resignation or removal,
the Property Trustee or Delaware Trustee resigning or being removed, as
applicable, may petition any court of competent jurisdiction for appointment of
a Successor Property Trustee or Successor Delaware Trustee. Such court may
thereupon, after prescribing such notice, if any, as it may deem proper and
prescribe, appoint a Successor Property Trustee or Successor Delaware Trustee,
as the case may be.

(f) No Property Trustee or Delaware Trustee shall be liable for the
acts or omissions to act of any Successor Property Trustee or Successor Delaware
Trustee, as the case may be.

SECTION 5.7. VACANCIES AMONG TRUSTEES.

If a Trustee ceases to hold office for any reason and the number of
Trustees is not reduced pursuant to Section 5.1, or if the number of Trustees is
increased pursuant to Section 5.1, a vacancy shall occur. A resolution
certifying the existence of such vacancy by the Regular Trustees or, if there
are more than two, a majority of the Regular Trustees shall be conclusive
evidence of the existence of such vacancy. The vacancy shall be filled with a
Trustee appointed in accordance with Section 5.6.

SECTION 5.8. EFFECT OF VACANCIES.

The death, resignation, retirement, removal, bankruptcy, dissolution,
liquidation, incompetence or incapacity to perform the duties of a Trustee shall
not operate to dissolve, terminate or annul the Trust. Whenever a vacancy in
the number of Regular Trustees shall occur, until such vacancy is filled by the
appointment of a Regular Trustee in accordance with Section 5.6, the Regular
Trustees in office, regardless of their number, shall have all the powers
granted to the Regular Trustees and shall discharge all the duties imposed upon
the Regular Trustees by this Declaration.

SECTION 5.9. MEETINGS.

If there is more than one Regular Trustee, meetings of the Regular
Trustees shall be held from time to time upon the call of any Regular Trustee.
Regular meetings of the Regular Trustees may be held at a time and place fixed
by resolution of the Regular Trustees. Notice of any in-person meetings of the
Regular Trustees shall be hand delivered or otherwise delivered in writing
(including by facsimile, with a hard copy by overnight courier) not less than 48
hours before such meeting. Notice of any telephonic meetings of the Regular
Trustees or any

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<PAGE>

committee thereof shall be hand delivered or otherwise delivered in writing
(including by facsimile, with a hard copy by overnight courier) not less than
24 hours before a meeting. Notices shall contain a brief statement of the
time, place and anticipated purposes of the meeting. The presence (whether
in person or by telephone) of a Regular Trustee at a meeting shall constitute
a waiver of notice of such meeting except where a Regular Trustee attends a
meeting for the express purpose of objecting to the transaction of any
activity on the ground that the meeting has not been lawfully called or
convened. Unless provided otherwise in this Declaration, any action of the
Regular Trustees may be taken at a meeting by vote of a majority of the
Regular Trustees present (whether in person or by telephone) and eligible to
vote with respect to such matter, provided that a Quorum is present, or
without a meeting by the unanimous written consent of the Regular Trustees.
In the event there is only one Regular Trustee, any and all action of such
Regular Trustee shall be evidenced by a written consent of such Regular
Trustee.

SECTION 5.10. DELEGATION OF POWER.

A Regular Trustee may, by power of attorney consistent with applicable
law, delegate to any other natural person over the age of 21 his or her power
for the purposes of executing any documents contemplated in Section 3.6,
including any registration statement or amendment thereto filed with the
Commission, or making any other governmental filing.

The Regular Trustees shall have power to delegate from time to time to
such of their number or to officers of the Trust the doing of such things and
the execution of such instruments either in the name of the Trust or the names
of the Regular Trustees or otherwise as the Regular Trustees may deem expedient,
to the extent such delegation is not prohibited by applicable law or contrary to
the provisions of the Trust, as set forth herein.

SECTION 5.11. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS.

Any corporation into which the Property Trustee or the Delaware Trustee,
as the case may be, may be merged or converted or with which either may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Property Trustee or the Delaware Trustee, as the case
may be, shall be a party, or any corporation succeeding to all or substantially
all the corporate trust business of the Property Trustee or the Delaware
Trustee, as the case may be, shall be the successor of the Property Trustee or
the Delaware Trustee, as the case may be, hereunder, provided such corporation
shall be otherwise qualified and eligible under this Article, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto.

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ARTICLE VI

DISTRIBUTIONS

SECTION 6.1. DISTRIBUTIONS.

Holders of Securities shall receive Distributions (as defined herein) in
accordance with the applicable terms of the relevant Holder's Securities.
Distributions shall be made on the Preferred Securities and the Common
Securities in accordance with the preferences set forth in their respective
terms. If and to the extent that the Debt Security Issuer makes a payment of
interest (including Compound Interest (as defined in the Indenture, if
applicable) and Additional Interest (as defined in the Indenture, if
applicable)), premium and/or principal on the Debt Securities held by the
Property Trustee (the amount of any such payment being a "Payment Amount"), the
Property Trustee shall and is directed, to the extent funds are available for
that purpose, to make a distribution (a "Distribution") of the Payment Amount to
Holders.

ARTICLE VII

ISSUANCE OF SECURITIES

SECTION 7.1. GENERAL PROVISIONS REGARDING SECURITIES.

(a) The Regular Trustees shall on behalf of the Trust issue one class
of [convertible] preferred securities representing undivided beneficial
interests in the assets of the Trust having such terms as are set forth in Annex
I (the "Preferred Securities") and one class of [convertible] common securities
representing undivided beneficial interests in the assets of the Trust having
such terms as are set forth in Annex I (the "Common Securities"). The Trust
shall issue no securities or other interests in the assets of the Trust other
than the Preferred Securities and the Common Securities.

(b) The consideration received by the Trust for the issuance of the
Securities shall constitute a contribution to the capital of the Trust and
shall not constitute a loan to the Trust.

(c) Upon issuance of the Securities as provided in this Declaration,
the Securities so issued shall be deemed to be validly issued, fully paid and
non-assessable.

(d) Every Person, by virtue of having become a Holder or a Preferred
Security Beneficial Owner in accordance with the terms of this Declaration,
shall be deemed to have expressly assented and agreed to the terms of and shall
be bound by this Declaration.

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SECTION 7.2. SUBORDINATION OF COMMON SECURITIES.

Payment of Distributions on, and the redemption price of the Preferred
Securities and Common Securities, as applicable, will be made PRO RATA based on
the liquidation amount of such Preferred Securities and Common Securities.
However, if on any date on which a Distribution is to be made, or any Redemption
Date, an Event of Default has occurred and is continuing, no payment of any
Distribution on, or Redemption Price of, any of the Common Securities, and no
other payment on account of the redemption, liquidation or other acquisition of
such common Securities shall be made unless payment in full in cash of all
accumulated and unpaid Distribution on all the outstanding Preferred Securities
for all Distribution periods terminating on or prior thereto, or in the case of
payment of the Redemption price the full amount of such Redemption Price on all
the outstanding Preferred Securities then called for redemption, shall have ben
made or provided for, and all funds available to the Property Trustee shall
first be applied to the payment in full in cash of all Distributions on, or the
Redemption Price of, the Preferred Securities then due and payable.

SECTION 7.3. EXECUTION AND AUTHENTICATION.

(a) The Certificates shall be signed on behalf of the Trust by a
Regular Trustee. In case any Regular Trustee of the Trust who shall have signed
any of the Securities shall cease to be such Regular Trustee before the
Certificates so signed shall be delivered by the Trust, such Certificates
nevertheless may be delivered as though the person who signed such Certificates
had not ceased to be such Regular Trustee; and any Certificate may be signed on
behalf of the Trust by such persons who, at the actual date of execution of such
Security, shall be the Regular Trustees of the Trust, although at the date of
the execution and delivery of the Declaration any such person was not such a
Regular Trustee.

(b) One Regular Trustee shall sign the Preferred Securities for the
Trust by manual or facsimile signature. Unless otherwise determined by the
Trust, such signature shall, in the case of Common Securities, be a manual
signature.

A Preferred Security shall not be valid until authenticated by the manual
signature of an authorized signatory of the Property Trustee. The signature
shall be conclusive evidence that the Preferred Security has been authenticated
under this Declaration.

Upon a written order of the Trust signed by one Regular Trustee, the
Property Trustee shall authenticate the Preferred Securities for original issue.

The Property Trustee may appoint an authenticating agent acceptable to
the Trust to authenticate Preferred Securities. An authenticating agent may
authenticate Preferred Securities whenever the Property Trustee may do so. Each
reference in this Declaration to authentication by the Property Trustee includes
authentication by such agent. An authenticating agent has the same rights as
the Property Trustee to deal with the Trust or an Affiliate.

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SECTION 7.4. FORM AND DATING.

The Preferred Securities and the Property Trustee's certificate of
authentication shall be substantially in the form of Exhibit A-1 and the Common
Securities shall be substantially in the form of Exhibit A-2, each of which is
hereby incorporated in and expressly made a part of this Declaration.
Certificates may be printed, lithographed or engraved or may be produced in any
other manner as is reasonably acceptable to the Regular Trustees, as evidenced
by their execution thereof. The Securities may have letters, numbers,
notations, other marks of identification or designation or other changes or
additions thereto or deletions therefrom as may be required by ordinary usage,
custom or practice and such legends or endorsements required by law, stock
exchange rule and agreements to which the Trust is subject, if any (provided
that any such notation, legend or endorsement is in a form acceptable to the
Trust). The Trust at the direction of the Sponsor shall furnish any such legend
not contained in Exhibit A-1 to the Property Trustee in writing. Each Preferred
Security Certificate shall be dated the date of its authentication. The terms
and provisions of the Securities set forth in Annex I and the forms of
Securities set forth in Exhibits A-1 and A-2 are part of the terms of this
Declaration and, to the extent applicable, the Property Trustee and the Sponsor,
by their execution and delivery of this Declaration, expressly agree to such
terms and provisions and to be bound thereby.

SECTION 7.5. PAYING AGENT. The Trust shall maintain in the Borough of
Manhattan, City of New York, State of New York, an office or agency where
Preferred Securities not held in book-entry only form may be presented for
payment ("Paying Agent"). [The Trust shall maintain an office or agency where
Securities may be presented for conversion ("Conversion Agent").] The Trust may
appoint the Paying Agent [and the Conversion Agent] and may appoint one or more
additional paying agents [and one or more additional conversion agents] in such
other locations as it shall determine. The term "Paying Agent" includes any
additional paying agent [and the term "Conversion Agent" includes any additional
conversion agent]. The Trust may change any Paying Agent [or Conversion Agent]
without prior notice to any Holder. The Trust shall notify the Property Trustee
in writing of the name and address of any Agent not a party to this Declaration.
If the Trust fails to appoint or maintain another entity as Paying Agent [or
Conversion Agent], the Property Trustee shall act as such. The Trust or any of
its Affiliates may act as Paying Agent [or Conversion Agent]. The Trust shall
act as Paying Agent [and Conversion Agent] for the Common Securities.

The Trust initially appoints _________________, ___________________,
_____________, __________, ____ _______, Attention: ____________ as Paying Agent
[and Conversion Agent] for the Preferred Securities.

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ARTICLE VIII

TERMINATION OF TRUST

SECTION 8.1. TERMINATION OF TRUST.

(a) The Trust shall terminate:

(i) upon the bankruptcy of the Sponsor or the Holder of the
Common Securities;

(ii) upon the filing of a certificate of dissolution or its
equivalent with respect to the Sponsor or the Holder of the Common
Securities; the filing of a certificate of cancellation with respect to
the Trust after having obtained the consent of at least a Majority in
liquidation amount of the Securities voting together as a single class to
file such certificate of cancellation; or the revocation of the Sponsor's
charter or the charter of the Holder of the Common Securities and the
expiration of 90 days after the date of revocation without a
reinstatement thereof;

(iii) upon the entry of a decree of judicial dissolution of the
Sponsor, the Trust or the Holder of the Common Securities;

(iv) when all of the Securities shall have been called for
redemption and the amounts necessary for redemption thereof shall have
been paid to the Holders in accordance with the terms of the Securities;

(v) upon the occurrence and continuation of a Special Event
pursuant to which the Trust shall have been dissolved in accordance with
the terms of the Securities and all of the Debt Securities held by the
Property Trustee shall have been distributed to the Holders of Securities
in exchange for all of the Securities;

(vi) upon the written direction to the Property Trustee from the
Holder of the Common Securities at any time to terminate the Trust and,
after satisfaction of liabilities to creditors of the Trust as provided
by applicable law, the distribution of Debt Securities to Holders in
exchange for the Securities, subject to the Regular Trustees' receipt of
an opinion of nationally recognized independent counsel experienced in
such matters to the effect that the holders of the Preferred Securities
will not recognize any income, gain or loss for United States federal
income tax purposes as a result of the dissolution of the Trust and such
distribution to Holders;

[(vii) upon the distribution of the Sponsor's Common Stock to all
Holders of Preferred Securities upon conversion of all outstanding
Preferred Securities;]

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(viii) the expiration of the term of the Trust on ________ ____,
_____; or

(ix) before the issuance of any Securities, with the consent of
all of the Regular Trustees and the Sponsor.

(b) As soon as is practicable after the occurrence of an event
referred to in Section 8.1(a), the Trustees shall file a certificate of
cancellation with the Secretary of State of the State of Delaware.

ARTICLE IX

TRANSFER OF INTERESTS

SECTION 9.1. TRANSFER OF SECURITIES.

(a) Securities may only be transferred, in whole or in part, in
accordance with the terms and conditions set forth in this Declaration and in
the terms of the Securities. Any transfer or purported transfer of any Security
not made in accordance with this Declaration shall be null and void.

(b) Subject to this Article IX, Preferred Securities shall be
transferable.

(c) Subject to this Article IX, the Sponsor and any Related Party may
only transfer Common Securities to the Sponsor or a Related Party of the
Sponsor; PROVIDED THAT, any such transfer shall not violate the Securities Act
and is subject to the condition precedent that the transferor obtain the written
opinion of nationally recognized independent counsel experienced in such matters
that such transfer would not cause more than an insubstantial risk that:

(i) the Trust would not be classified for United States federal
income tax purposes as a grantor trust; and

(ii) the Trust would be an Investment Company required to
register under the Investment Company Act or the transferee would become
an Investment Company required to register under the Investment Company
Act.

(d) Each Common Security that bears or is required to bear the legend
set forth in this Section 9.1(d) shall be subject to the restrictions on
transfer provided in the legend set forth in this Section 9.1(d), unless such
restrictions on transfer shall be waived by the written consent of the Regular
Trustees, and the Holder of each such Common Security, by such securityholder's

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acceptance thereof, agrees to be bound by such restrictions on transfer. As
used in this Section 9.1(d) and in Section 9.1(e), the term "transfer"
encompasses any sale, pledge, transfer or other disposition of any such Common
Security.

Any certificate evidencing a Common Security shall bear a legend in
substantially the following form, unless otherwise agreed by the Regular
Trustees (with written notice thereof to the Property Trustee):

THE SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE
U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD UNLESS SUCH OFFER AND
SALE ARE REGISTERED UNDER OR ARE EXEMPT FROM REGISTRATION UNDER
THE SECURITIES ACT. THE TRANSFER OF THE SECURITY EVIDENCED HEREBY
IS ALSO SUBJECT TO THE RESTRICTIONS SET FORTH IN THE DECLARATION
REFERRED TO BELOW.

SECTION 9.2. TRANSFER OF CERTIFICATES.

The Regular Trustees shall provide for the registration of Certificates
and of transfers of Certificates, which will be effected without charge, but
only upon payment in respect of any tax or other government charges that may be
imposed in relation to it. Upon surrender for registration of transfer of any
Certificate, the Regular Trustees shall cause one or more new Certificates to be
issued in the name of the designated transferee or transferees. Every
Certificate surrendered for registration of transfer shall be accompanied by a
written instrument of transfer in form satisfactory to the Regular Trustees duly
executed by the Holder or such Holder's attorney duly authorized in writing.
Each Certificate surrendered for registration of transfer shall be canceled by
the Regular Trustees. A transferee of a Certificate shall be entitled to the
rights and subject to the obligations of a Holder hereunder upon the receipt by
such transferee of a Certificate. By acceptance of a Certificate, each
transferee shall be deemed to have agreed to be bound by this Declaration.

SECTION 9.3. DEEMED SECURITY HOLDERS.

The Trustees may treat the Person in whose name any Certificate shall be
registered on the books and records of the Trust as the sole holder of such
Certificate and of the Securities represented by such Certificate for purposes
of receiving Distributions and for all other purposes whatsoever and,
accordingly, shall not be bound to recognize any equitable or other claim to or
interest in such Certificate or in the Securities represented by such
Certificate on the part of any Person, whether or not the Trust shall have
actual or other notice thereof.

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SECTION 9.4. BOOK ENTRY INTERESTS.

(a) So long as Preferred Securities are eligible for book-entry
settlement with the Clearing Agency or unless otherwise required by law, all
Preferred Securities that are so eligible may be represented by one or more
fully registered Preferred Security Certificates (each, a "Global Certificate")
in global form to be delivered to DTC, the initial Clearing Agency, by, or on
behalf of, the Trust. Such Global Certificates shall initially be registered on
the books and records of the Trust in the name of Cede & Co., the nominee of
DTC, and no Preferred Security Beneficial Owner will receive a definitive
Preferred Security Certificate representing such Preferred Security Beneficial
Owner's interests in such Global Certificates, except as provided in Section 9.7
below. The transfer and exchange of beneficial interests in any such Security
in global form shall be effected through the Clearing Agency in accordance with
this Declaration and the procedures of the Clearing Agency therefor.

(b) Except as provided below, beneficial owners of a Preferred
Security in global form shall not be entitled to have certificates registered in
their names, will not receive or be entitled to receive physical delivery of
certificates in definitive form and will not be considered Holders of such
Preferred Security in global form.

(c) Any Global Certificate may be endorsed with or have incorporated
in the text thereof such legends or recitals or changes not inconsistent with
the provisions of this Declaration as may be required by the Clearing Agency, by
any national securities exchange or by the National Association of Securities
Dealers, Inc. as may be required to comply with any applicable law or any
regulation thereunder or with the rules and regulations of any securities
exchange or interdealer quotation system upon which the Preferred Securities may
be listed or traded or to conform with any usage with respect thereto, or to
indicate any special limitations or restrictions to which any particular
Preferred Securities are subject.

(d) Unless and until definitive, fully registered Preferred Security
Certificates (the "Definitive Preferred Security Certificates") have been issued
to the Preferred Security Beneficial Owners of a Preferred Security in global
form pursuant to Section 9.7:

(i) the provisions of this Section 9.4 shall be in full force
and effect with respect to such Preferred Securities;

(ii) the Trust and the Trustees shall be entitled to deal with
the Clearing Agency for all purposes of this Declaration (including the
payment of Distributions on the Global Certificates and receiving
approvals, votes or consents hereunder) as the Holder of such Preferred
Securities and the sole holder of the Global Certificates and shall have
no obligation to the Preferred Security Beneficial Owners of such
Preferred Securities;

(iii) to the extent that the provisions of this Section 9.4
conflict with any other provisions of this Declaration, the provisions of
this Section 9.4 shall control; and

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(iv) the rights of the Preferred Security Beneficial Owners of
Preferred Securities in global form shall be exercised only through the
Clearing Agency and shall be limited to those established by law and
agreements between such Preferred Security Beneficial Owners and the
Clearing Agency and/or the Clearing Agency Participants. The Clearing
Agency will make book-entry transfers among Clearing Agency Participants
and receive and transmit payments of Distributions on the Global
Certificates to such Clearing Agency Participants. DTC will make book
entry transfers among the Clearing Agency Participants PROVIDED, that
solely for the purposes of determining whether the Holders of the
requisite amount of Preferred Securities have voted on any matter
provided for in this Declaration, so long as Definitive Preferred
Security Certificates have not been issued, the Trustees may conclusively
rely on, and shall be protected in relying on, any written instrument
(including a proxy) delivered to the Trustees by the Clearing Agency
setting forth the Preferred Securities Beneficial Owners' votes or
assigning the right to vote on any matter to any other Persons either in
whole or in part.

(e) Notwithstanding any other provisions of this Declaration (other
than the provisions set forth in this Section 9.4(e)), a Preferred Security in
global form may not be transferred as a whole except by the Clearing Agency to a
nominee of the Clearing Agency or by a nominee of the Clearing Agency to the
Clearing Agency or another nominee to a successor Clearing Agency or a nominee
of such successor Clearing Agency.

SECTION 9.5. NOTICES TO CLEARING AGENCY.

Whenever a notice or other communication to the Preferred Security
Holders is required under this Declaration, unless and until Definitive
Preferred Security Certificates shall have been issued to the Preferred Security
Beneficial Owners pursuant to Section 9.7, the Regular Trustees shall give all
such notices and communications specified herein to be given to the Preferred
Security Holders to the Clearing Agency, and shall have no notice obligations to
the Preferred Security Beneficial Owners.

SECTION 9.6. APPOINTMENT OF SUCCESSOR CLEARING AGENCY.

If any Clearing Agency notifies the Trust that it is unwilling or unable
to continue its services as securities depositary with respect to the Preferred
Securities, if such Clearing Agency ceases to perform such services, or if at
any time such Clearing Agency ceases to be a clearing agency registered as such
under the Exchange Act when such Clearing Agency is required to be so registered
to act as such depositary, then the Regular Trustees may, in their sole
discretion, appoint a successor Clearing Agency with respect to such Preferred
Securities.

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SECTION 9.7. DEFINITIVE PREFERRED SECURITY CERTIFICATES UNDER CERTAIN
CIRCUMSTANCES.

If:

(a) a Clearing Agency notifies the Trust that it is unwilling or
unable to continue its services as securities depositary with respect to the
Preferred Securities, if at any time such Clearing Agency ceases to be a
clearing agency registered as such under the Exchange Act when such Clearing
Agency is required to be so registered to act as such depositary and no
successor Clearing Agency shall have been appointed pursuant to Section 9.6
within 90 days of such notification;

(b) the Regular Trustees (with the consent of the Sponsor), in their
sole discretion determine that the Preferred Securities in global form shall be
exchanged for certificated Preferred Securities; or

then:

(d) Definitive Preferred Security Certificates shall be prepared by
the Regular Trustees on behalf of the Trust with respect to such Preferred
Securities; and

(e) upon surrender of the Global Certificates by the Clearing Agency,
accompanied by registration instructions, the Regular Trustees shall cause
Definitive Preferred Security Certificates to be delivered to Preferred Security
Beneficial Owners of such Preferred Securities in accordance with the
instructions of the Clearing Agency. Neither the Trustees nor the Trust shall
be liable for any delay in delivery of such instructions and each of them may
conclusively rely on and shall be protected in relying on, said instructions of
the Clearing Agency. The Definitive Preferred Security Certificates shall be
printed, lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Regular Trustees, as evidenced by their execution
thereof, and may have such letters, numbers or other marks of identification or
designation and such legends or endorsements as the Regular Trustees may deem
appropriate, or as may be required to comply with any law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any stock
exchange on which Preferred Securities may be listed, or to conform to usage.

At such time as all interests in a Preferred Security in global form have
been redeemed, [converted,] exchanged, repurchased or canceled, such Preferred
Security in global form shall be, upon receipt thereof, canceled by the Trust in
accordance with standing procedures and instructions of the Clearing Agency.

SECTION 9.8. MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES.

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If:

(a) any mutilated Certificates should be surrendered to the Regular
Trustees, or if the Regular Trustees shall receive evidence to their
satisfaction of the destruction, loss or theft of any Certificate; and

(b) there shall be delivered to the Property Trustee or the Regular
Trustees such security or indemnity as may be required by them to keep each of
them harmless,

then:

in the absence of notice that such Certificate shall have been acquired
by a bona fide purchaser, the Property Trustee or any Regular Trustee on behalf
of the Trust shall execute and deliver, in exchange for, or in lieu of, any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
denomination. In connection with the issuance of any new Certificate under this
Section 9.8, the Property Trustee or the Regular Trustees may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection therewith. Any duplicate Certificate issued
pursuant to this Section shall constitute conclusive evidence of an ownership
interest in the relevant Securities, as if originally issued, whether or not the
lost, stolen or destroyed Certificate shall be found at any time.

ARTICLE X

LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES,
TRUSTEES OR OTHERS

SECTION 10.1. LIABILITY.

(a) Except as expressly set forth in this Declaration, the Securities
Guarantees and the terms of the Securities, the Sponsor shall not be:

(i) personally liable for the return of any portion of the
capital contributions (or any return thereon) of the Holders of the
Securities which shall be made solely from assets of the Trust; or

(ii) required to pay to the Trust or to any Holder of Securities
any deficit upon dissolution of the Trust or otherwise.

(b) The Holder of the Common Securities shall be liable for all of the
debts and obligations of the Trust (other than with respect to the Securities)
to the extent not satisfied out of the Trust's assets.

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(c) Pursuant to Section 3803(a) of the Business Trust Act, the Holders
of the Preferred Securities shall be entitled to the same limitation of personal
liability extended to stockholders of private corporations for profit organized
under the General Corporation Law of the State of Delaware.

SECTION 10.2. EXCULPATION.

(a) No Indemnified Person shall be liable, responsible or accountable
in damages or otherwise to the Trust or any Covered Person for any loss, damage
or claim incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith on behalf of the Trust and in a manner such
Indemnified Person reasonably believed to be within the scope of the authority
conferred on such Indemnified Person by this Declaration or by law, except that
an Indemnified Person shall be liable for any such loss, damage or claim
incurred by reason of such Indemnified Person's gross negligence (or, in the
case of the Property Trustee, except as otherwise set forth in Section 3.9) or
willful misconduct with respect to such acts or omissions.

(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Trust and upon such information, opinions, reports
or statements presented to the Trust by any Person as to matters the Indemnified
Person reasonably believes are within such other Person's professional or expert
competence and who has been selected with reasonable care by or on behalf of the
Trust, including information, opinions, reports or statements as to the value
and amount of the assets, liabilities, profits, losses, or any other facts
pertinent to the existence and amount of assets from which Distributions to
Holders of Securities might properly be paid.

SECTION 10.3. FIDUCIARY DUTY.

(a) To the extent that, at law or in equity, an Indemnified Person has
duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to any other Covered Person, an Indemnified Person acting under this
Declaration shall not be liable to the Trust or to any other Covered Person for
its good faith reliance on the provisions of this Declaration. The provisions
of this Declaration, to the extent that they restrict the duties and liabilities
of an Indemnified Person otherwise existing at law or in equity (other than the
duties imposed on the Property Trustee under the Trust Indenture Act), are
agreed by the parties hereto to replace such other duties and liabilities of
such Indemnified Person.

(b) Unless otherwise expressly provided herein:

(i) whenever a conflict of interest exists or arises between
any Covered Persons; or

(ii) whenever this Declaration or any other agreement
contemplated herein or therein provides that an Indemnified Person shall
act in a manner that is, or provides terms that are, fair and reasonable
to the Trust or any Holder of Securities, the

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Indemnified Person shall resolve such conflict of interest, take such
action or provide such terms, considering in each case the relative
interest of each party (including its own interest) to such conflict,
agreement, transaction or situation and the benefits and burdens
relating to such interests, any customary or accepted industry
practices, and any applicable generally accepted accounting practices
or principles. In the absence of bad faith by the Indemnified Person,
the resolution, action or term so made, taken or provided by the
Indemnified Person shall not constitute a breach of this Declaration
or any other agreement contemplated herein or of any duty or
obligation of the Indemnified Person at law or in equity or otherwise.

(i) in its "discretion" or under a grant of similar authority,
the Indemnified Person shall be entitled to consider such interests and
factors as it desires, including its own interests, and shall have no
duty or obligation to give any consideration to any interest of or
factors affecting the Trust or any other Person; or

(ii) in its "good faith" or under another express standard, the
Indemnified Person shall act under such express standard and shall not be
subject to any other or different standard imposed by this Declaration or
by applicable law.

SECTION 10.4. INDEMNIFICATION.

(a) (i) the Debt Security Issuer shall indemnify, to the full
extent permitted by law, any Company Indemnified Person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right
of the Trust) by reason of the fact that he is or was a Company
Indemnified Person against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he
acted in good faith and in a manner he reasonably believed to be in or
not opposed to the best interests of the Trust, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful. The termination of any action, suit or proceeding
by judgment, order, settlement, conviction, or upon a plea of NOLO
CONTENDERE or its equivalent, shall not, of itself, create a presumption
that the Company Indemnified Person did not act in good faith and in a
manner which he reasonably believed to be in or not opposed to the best
interests of the Trust, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe that his conduct was
unlawful.

(ii) The Debt Security Issuer shall indemnify, to the full
extent permitted by law, any Company Indemnified Person who was or is a
party or is threatened to be made

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a party to any threatened, pending or completed action or suit by or
in the right of the Trust to procure a judgment in its favor by reason
of the fact that he is or was a Company Indemnified Person against
expenses (including attorneys' fees) actually and reasonably incurred
by him in connection with the defense or settlement of such action or
suit if he acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the Trust and except
that no such indemnification shall be made in respect of any claim,
issue or matter as to which such Company Indemnified Person shall have
been adjudged to be liable to the Trust unless and only to the extent
that the Court of Chancery of Delaware or the court in which such
action or suit was brought shall determine upon application that,
despite the adjudication of liability but in view of all the
circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which such Court of Chancery
or such other court shall deem proper.

(iii) To the extent that a Company Indemnified Person shall be
successful on the merits or otherwise (including dismissal of an action
without prejudice or the settlement of an action without admission of
liability) in defense of any action, suit or proceeding referred to in
paragraphs (i) and (ii) of this Section 10.4(a), or in defense of any
claim, issue or matter therein, he shall be indemnified, to the full
extent permitted by law, against expenses (including attorneys' fees)
actually and reasonably incurred by him in connection therewith.

(iv) Any indemnification under paragraphs (i) and (ii) of this
Section 10.4(a) (unless ordered by a court) shall be made by the Debt
Security Issuer only as authorized in the specific case upon a
determination that indemnification of the Company Indemnified Person is
proper in the circumstances because he has met the applicable standard of
conduct set forth in paragraphs (i) or (ii). Such determination shall be
made (1) by the Regular Trustees by a majority vote of a quorum
consisting of such Regular Trustees who were not parties to such action,
suit or proceeding, (2) if such a quorum is not obtainable, or, even if
obtainable, if a quorum of disinterested Regular Trustees so directs, by
independent legal counsel in a written opinion, or (3) by the Common
Security Holder of the Trust.

(v) Expenses (including attorneys' fees) incurred by a Company
Indemnified Person in defending a civil, criminal, administrative or
investigative action, suit or proceeding referred to in paragraphs (i)
and (ii) of this Section 10.4(a) shall be paid by the Debt Security
Issuer in advance of the final disposition of such action, suit or
proceeding upon receipt of an undertaking by or on behalf of such Company
Indemnified Person to repay such amount if it shall ultimately be
determined that he is not entitled to be indemnified by the Debt Security
Issuer as authorized in this Section 10.4(a). Notwithstanding the
foregoing, no advance shall be made by the Debt Security Issuer if a
determination is reasonably and promptly made (i) by the Regular Trustees
by a majority vote of a quorum of disinterested Regular Trustees, (ii) if
such a quorum is not obtainable, or, even if obtainable, if a quorum of
disinterested Regular Trustees so

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<PAGE>

directs, by independent legal counsel in a written opinion or (iii) by
the Common Security Holder of the Trust, that, based upon the facts
known to the Regular Trustees, counsel or the Common Security Holder
at the time such determination is made, such Company Indemnified
Person acted in bad faith or in a manner that such person did not
believe to be in or not opposed to the best interests of the Trust,
or, with respect to any criminal proceeding, that such Company
Indemnified Person believed or had reasonable cause to believe his
conduct was unlawful. In no event shall any advance be made in
instances where the Regular Trustees, independent legal counsel or
Common Security Holder reasonably determine that such person
deliberately breached his duty to the Trust or its Common or Preferred
Security Holders.

(vi) The indemnification and advancement of expenses provided
by, or granted pursuant to, the other paragraphs of this Section 10.4(a)
shall not be deemed exclusive of any other rights to which those seeking
indemnification and advancement of expenses may be entitled under any
agreement, vote of shareholders or disinterested directors of the Debt
Security Issuer or Preferred Security Holders of the Trust or otherwise,
both as to action in his official capacity and as to action in another
capacity while holding such office. All rights to indemnification under
this Section 10.4(a) shall be deemed to be provided by a contract between
the Debt Security Issuer and each Company Indemnified Person who serves
in such capacity at any time while this Section 10.4(a) is in effect.
Any repeal or modification of this Section 10.4(a) shall not affect any
rights or obligations then existing.

(vii) The Debt Security Issuer or the Trust may purchase and
maintain insurance on behalf of any person who is or was a Company
Indemnified Person against any liability asserted against him and
incurred by him in any such capacity, or arising out of his status as
such, whether or not the Debt Security Issuer would have the power to
indemnify him against such liability under the provisions of this Section
10.4(a)

(viii) For purposes of this Section 10.4(a), references to "the
Trust" shall include, in addition to the resulting or surviving entity,
any constituent entity (including any constituent of a constituent)
absorbed in a consolidation or merger, so that any person who is or was a
director, trustee, officer or employee of such constituent entity, or is
or was serving at the request of such constituent entity as a director,
trustee, officer, employee or agent of another entity, shall stand in the
same position under the provisions of this Section 10.4(a) with respect
to the resulting or surviving entity as he would have with respect to
such constituent entity if its separate existence had continued.

(ix) The indemnification and advancement of expenses provided
by, or granted pursuant to, this Section 10.4(a) shall, unless otherwise
provided when authorized or ratified, continue as to a person who has
ceased to be a Company Indemnified Person and shall inure to the benefit
of the heirs, executors and administrators of such a person.

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<PAGE>

(b) The Debt Security Issuer agrees to indemnify the (i) Property
Trustee, (ii) the Delaware Trustee, (iii) any Affiliate of the Property Trustee
and the Delaware Trustee, and (iv) any officers, directors, shareholders,
members, partners, employees, representatives, custodians, nominees or agents of
the Property Trustee and the Delaware Trustee (each of the Persons in (i)
through (iv) being referred to as a "Fiduciary Indemnified Person") for, and to
hold each Fiduciary Indemnified Person harmless against, any loss, liability or
expense incurred without negligence or bad faith on its part, arising out of or
in connection with the acceptance or administration or the trust or trusts
hereunder, including the costs and expenses (including reasonable legal fees and
expenses) of defending itself against or investigating any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder. The provisions of this Section 10.4(b) shall survive the
satisfaction and discharge of this Declaration or the resignation or removal of
the Property Trustee or the Delaware Trustee, as the case may be.

SECTION 10.5. OUTSIDE BUSINESS.

Any Covered Person, the Sponsor, the Delaware Trustee and the Property
Trustee may engage in or possess an interest in other business ventures of any
nature or description, independently or with others, similar or dissimilar to
the business of the Trust, and the Trust and the Holders of Securities shall
have no rights by virtue of this Declaration in and to such independent ventures
or the income or profits derived therefrom, and the pursuit of any such venture,
even if competitive with the business of the Trust, shall not be deemed wrongful
or improper. No Covered Person, the Sponsor, the Delaware Trustee, or the
Property Trustee shall be obligated to present any particular investment or
other opportunity to the Trust even if such opportunity is of a character that,
if presented to the Trust, could be taken by the Trust, and any Covered Person,
shall have the right to take for its own account (individually or as a partner
or fiduciary) or to recommend to others any such particular investment or other
opportunity. Any Covered Person, the Delaware Trustee and the Property Trustee
may engage or be interested in any financial or other transaction with the
Sponsor or any Affiliate of the Sponsor, or may act as depositary for, trustee
or agent for, or act on any committee or body of holders of, securities or other
obligations of the Sponsor or its Affiliates.

ARTICLE XI

ACCOUNTING

SECTION 11.1. FISCAL YEAR.

The fiscal year ("Fiscal Year") of the Trust shall be the same as the
fiscal year of the Sponsor, unless another fiscal year is required by the Code
or Treasury regulations promulgated thereunder.

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SECTION 11.2. CERTAIN ACCOUNTING MATTERS.

(a) At all times during the existence of the Trust, the Regular
Trustees shall keep, or cause to be kept, full books, records and supporting
documents, which shall reflect in detail, each transaction of the Trust. The
books of account shall be maintained on the accrual method of accounting in
compliance with generally accepted accounting principles, consistently applied.
The Trust shall use the accrual method of accounting for the United States
federal income tax purposes. The books of account and the records of the Trust
shall be examined by and reported upon as of the end of each Fiscal Year of the
Trust by a firm of independent certified public accountants selected by the
Regular Trustees.

(b) The Sponsor shall cause to be prepared and delivered to each of
the Holders of Securities, within 90 days after the end of each Fiscal Year of
the Sponsor, annual financial statements of the Sponsor, including a balance
sheet of the Sponsor as of the end of such Fiscal Year, and the related
statements of income or loss.

(c) The Regular Trustees shall cause to be duly prepared and delivered
to each of the Holders of Securities, any annual United States federal income
tax information statement, required by the Code, containing such information
with regard to the Securities held by each Holder as is required by the Code and
the Treasury Regulations. Notwithstanding any right under the Code to deliver
any such statement at a later date, the Regular Trustees shall endeavor to
deliver all such statements within 30 days after the end of each Fiscal Year of
the Trust.

(d) The Regular Trustees shall cause to be duly prepared and filed
with the appropriate taxing authority, an annual United States federal income
tax return, on a Form 1041 or such other form required by United States federal
income tax law, and any other annual income tax returns required to be filed by
the Regular Trustees on behalf of the Trust with any state or local taxing
authority.

SECTION 11.3. BANKING.

The Trust shall maintain one or more bank accounts in the name and for
the sole benefit of the Trust; PROVIDED, HOWEVER, that all payments of funds in
respect of the Debt Securities held by the Property Trustee shall be made
directly to the Property Trustee Account and no other funds of the Trust shall
be deposited in the Property Trustee Account. The sole signatories for such
accounts shall be designated by the Regular Trustees; PROVIDED, HOWEVER, that
the Property Trustee shall designate the signatories for the Property Trustee
Account.

SECTION 11.4. WITHHOLDING.

The Trust and the Regular Trustees shall comply with all withholding
requirements under United States federal, state and local law. The Trust shall
request, and the Holders shall provide to the Trust, such forms or certificates
as are necessary to establish an exemption from

49
<PAGE>

withholding with respect to each Holder, and any representations and forms as
shall reasonably be requested by the Trust to assist it in determining the
extent of, and in fulfilling, its withholding obligations. The Regular
Trustees shall file required forms with applicable jurisdictions and, unless
an exemption from withholding is properly established by a Holder, shall
remit amounts withheld with respect to the Holder to applicable
jurisdictions. To the extent that the Trust is required to withhold and pay
over any amounts to any authority with respect to distributions or
allocations to any Holder, the amount withheld shall be deemed to be a
distribution in the amount of the withholding to the Holder. In the event of
any claimed over-withholding, Holders shall be limited to an action against
the applicable jurisdiction. If the amount required to be withheld was not
withheld from actual Distributions made, the Trust may reduce subsequent
Distributions by the amount of such withholding. Furthermore, if withholding
is imposed on payments of interest on the Debt Securities, to the extent such
withholding is attributable to ownership by a specific Holder of Preferred
Securities, the amount withheld shall be deemed a distribution in the amount
of the withholding to such specific Holder.

ARTICLE XII

AMENDMENTS AND MEETINGS

SECTION 12.1. AMENDMENTS.

Except as otherwise provided in this Declaration or by any applicable
terms of the Securities,

(a) this Declaration may only be amended by a written instrument
approved and executed by the Regular Trustees (or, if there are more than two
Regular Trustees a majority of the Regular Trustees) and:

(i) if the amendment affects the rights, powers, duties,
obligations or immunities of the Property Trustee, also by the Property
Trustee; and

(ii) if the amendment affects the rights, powers, duties,
obligations or immunities of the Delaware Trustee, also by the Delaware
Trustee;

(b) no amendment shall be made, and any such purported amendment shall
be void and ineffective:

(i) unless, in the case of any proposed amendment, the Property
Trustee shall have first received an Officers' Certificate from each of
the Trust and the Sponsor that such amendment is permitted by, and
conforms to, the terms of this Declaration (including the terms of the
Securities);

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<PAGE>

(ii) unless, in the case of any proposed amendment which affects
the rights, powers, duties, obligations or immunities of the Property
Trustee, the Property Trustee shall have first received:

(A) an Officers' Certificate from each of the Trust and
the Sponsor that such amendment is permitted by, and conforms to,
the terms of this Declaration (including the terms of the
Securities); and

(B) an opinion of counsel (who may be counsel to the
Sponsor or the Trust) that such amendment is permitted by, and
conforms to, the terms of this Declaration (including the terms of
the Securities); and

(iii) to the extent the result of such amendment would be to:

(A) cause the Trust to fail to continue to be classified
for purposes of United States federal income taxation as a grantor
trust;

(B) reduce or otherwise adversely affect the powers of
the Property Trustee; or

(c) at such time after the Trust has issued any Securities that remain
outstanding, any amendment that would adversely affect the rights, privileges or
preferences of any Holder of Securities may be effected only with such
additional requirements as may be set forth in the terms of such Securities;

(d) Section 9.1(c) and this Section 12.1 shall not be amended without
the consent of all of the Holders of the Securities;

(e) Article IV shall not be amended without the consent of the Holders
of a Majority in liquidation amount of the Common Securities;

(f) the rights of the holders of the Common Securities under Article V
to increase or decrease the number of, and appoint and remove Trustees shall not
be amended without the consent of the Holders of a Majority in liquidation
amount of the Common Securities;

(g) notwithstanding Section 12.1(c), this Declaration may be amended
from time to time by the Holders of a Majority in liquidation amount of the
Common Securities and the Property Trustee, without the consent of the Holders
of the Preferred Securities to:

<PAGE>

(i) cure any ambiguity, correct or supplement any provision in
this Declaration that may be inconsistent with any other provision, or to
make any other provisions with respect to matters or questions arising
under this Declaration, which shall not be inconsistent with the other
provisions of this Declaration; or

(ii) to modify, eliminate or add to any provisions of this
Declaration to such extent as shall be necessary to ensure that the Trust
will be classified for United States federal income tax purposes as a
grantor trust at all times that any Securities are outstanding or to
ensure that the Trust will not be required to register as an investment
company under the Investment Company Act or to ensure that the Preferred
Securities will continue to constitute Tier I capital for purposes of the
capital adequacy guidelines or policies of the Federal Reserve or its
successor;

PROVIDED, HOWEVER, such action specified in this Section 12.1(g) shall not
adversely affect in any material respect the interests of any Holder of
Securities; and

(h) this Declaration may be amended by the Holders of a Majority in
liquidation amount of the Common Securities and the Property Trustee if:

(i) the Holders of a Majority in liquidation amount of the
Preferred Securities consent to such amendment and

(ii) the Regular Trustees have received an opinion of nationally
recognized independent counsel experienced in such matters to the effect
that such amendment or the exercise of any power granted to the Regular
Trustees in accordance with such amendment will not affect the Trust's
status as a grantor trust for United States federal income tax purposes
or the Trust's exemption from status as an "investment company" under the
Investment Company Act,

PROVIDED, that without the consent of each Holder of Securities, this
Declaration may not be amended to:

(x) change the amount or timing of any distribution on the
Securities or otherwise adversely affect the amount of any distribution
required to be made in respect of the Securities as of a specified date
or

(y) restrict the right of a Holder of Securities to institute
suit for the enforcement of any such payment on or after such date.

(i) Any amendments of this Declaration shall become effective when
notice thereof is given to Holders of Securities.

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SECTION 12.2. MEETINGS OF THE HOLDERS OF SECURITIES; ACTION BY
WRITTEN CONSENT.

(a) Meetings of the Holders of any class of Securities may be
called at any time by the Regular Trustees (or as provided in the terms of
the Securities) to consider and act on any matter on which Holders of such
class of Securities are entitled to act under the terms of this Declaration,
the terms of the Securities or the rules of any stock exchange on which the
Preferred Securities are listed or admitted for trading. The Regular
Trustees shall call a meeting of the Holders of such class if directed to do
so by the Holders of at least 25% in liquidation amount of such class of
Securities. Such direction shall be given by delivering to the Regular
Trustees one or more calls in a writing stating that the signing Holders of
Securities wish to call a meeting and indicating the general or specific
purpose for which the meeting is to be called. Any Holders of Securities
calling a meeting shall specify in writing the Security Certificates held by
the Holders of Securities exercising the right to call a meeting and only
those Securities specified shall be counted for purposes of determining
whether the required percentage set forth in the second sentence of this
paragraph has been met.

(b) Except to the extent otherwise provided in the terms of the
Securities, the following provisions shall apply to meetings of Holders of
Securities:

(i) notice of any such meeting shall be given to all the
Holders of Securities having a right to vote thereat at least 7 days and
not more than 60 days before the date of such meeting. Each such notice
will include a statement setting forth the following information: (i)
the date of such meeting or the date by which such action is to be taken;
(ii) a description of any resolution proposed for adoption at such
meeting on which such Holders are entitled to vote or of such matter upon
which written consent is sought; and (iii) instructions of the delivery
of proxies or consents. Whenever a vote, consent or approval of the
Holders of Securities is permitted or required under this Declaration or
the rules of any stock exchange on which the Preferred Securities are
listed or admitted for trading, such vote, consent or approval may be
given at a meeting of the Holders of Securities. Any action that may be
taken at a meeting of the Holders of Securities may be taken without a
meeting if a consent in writing setting forth the action so taken is
signed by the Holders of Securities owning not less than the minimum
amount of Securities in liquidation amount that would be necessary to
authorize or take such action at a meeting at which all Holders of
Securities having a right to vote thereon were present and voting.
Prompt notice of the taking of action without a meeting shall be given to
the Holders of Securities entitled to vote who have not consented in
writing. The Regular Trustees may specify that any written ballot
submitted to the Security Holder for the purpose of taking any action
without a meeting shall be returned to the Trust within the time
specified by the Regular Trustees;

(ii) each Holder of a Security may authorize any Person to act
for it by proxy on all matters in which a Holder of Securities is
entitled to participate, including waiving notice of any meeting, or
voting or participating at a meeting. No proxy shall be valid

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<PAGE>

after the expiration of 11 months from the date thereof unless
otherwise provided in the proxy. Every proxy shall be revocable at the
pleasure of the Holder of Securities executing it. Except as otherwise
provided herein, all matters relating to the giving, voting or validity
of proxies shall be governed by the General Corporation Law of the
State of Delaware relating to proxies, and judicial interpretations
thereunder, as if the Trust were a Delaware corporation and the Holders
of the Securities were stockholders of a Delaware corporation;

(iii) each meeting of the Holders of the Securities shall be
conducted by the Regular Trustees or by such other Person that the
Regular Trustees may designate;

(iv) unless the Business Trust Act, this Declaration, the terms
of the Securities, the Trust Indenture Act or the listing rules of any
stock exchange on which the Preferred Securities are then listed or
trading, otherwise provides, the Regular Trustees, in their sole
discretion, shall establish all other provisions relating to meetings of
Holders of Securities, including notice of the time, place or purpose of
any meeting at which any matter is to be voted on by any Holders of
Securities, waiver of any such notice, action by consent without a
meeting, the establishment of a record date, quorum requirements, voting
in person or by proxy or any other matter with respect to the exercise of
any such right to vote; and

(v) any Preferred Securities that are owned by the Debt
Security Issuer or any entity directly or indirectly controlling or
controlled by, or under direct or indirect common control with, the Debt
Security Issuer shall not be entitled to vote or consent and shall, for
purposes of any vote or consent, be treated as if such Preferred
Securities were not issued and outstanding.

ARTICLE XIII

REPRESENTATIONS OF PROPERTY TRUSTEE AND
DELAWARE TRUSTEE

SECTION 13.1. REPRESENTATIONS AND WARRANTIES OF PROPERTY TRUSTEE.

The Trustee that acts as initial Property Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Declaration, and
each Successor Property Trustee represents and warrants, as applicable, to
the Trust and the Sponsor at the time of the Successor Property Trustee's
acceptance of its appointment as Property Trustee that:

(a) the Property Trustee is a national banking association with
trust powers, duly organized, validly existing and in good standing, with
trust power and authority to execute and deliver, and to carry out and
perform its obligations under the terms of, the Declaration;

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<PAGE>

(b) the execution, delivery and performance by the Property Trustee
of the Declaration has been duly authorized by all necessary corporate action
on the part of the Property Trustee. The Declaration has been duly executed
and delivered by the Property Trustee, and it constitutes a legal, valid and
binding obligation of the Property Trustee, enforceable against it in
accordance with its terms, subject to applicable bankruptcy, reorganization,
moratorium, insolvency, and other similar laws affecting creditors' rights
generally and to general principles of equity and the discretion of the court
(regardless of whether the enforcement of such remedies is considered in a
proceeding in equity or at law);

(c) the execution, delivery and performance of the Declaration by
the Property Trustee does not conflict with or constitute a breach of the
charter or by-laws of the Property Trustee; and

(d) no consent, approval or authorization of, or registration with
or notice to, any state or federal banking authority is required for the
execution, delivery or performance by the Property Trustee, of the
Declaration.

SECTION 13.2. REPRESENTATIONS AND WARRANTIES OF DELAWARE TRUSTEE.

The Trustee that acts as initial Delaware Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Declaration, and
each Successor Delaware Trustee represents and warrants to the Trust and the
Sponsor at the time of the Successor Delaware Trustee's acceptance of its
appointment as Delaware Trustee that:

(a) The Delaware Trustee is a Delaware corporation, duly organized,
validly existing and in good standing, with corporate power and authority to
execute and deliver, and to carry out and perform its obligations under the
terms of, the Declaration.

(b) The Delaware Trustee has been authorized to perform its
obligations under the Certificate of Trust and the Declaration. The
Declaration under Delaware law constitutes a legal, valid and binding
obligation of the Delaware Trustee, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency, and other similar laws affecting creditors' rights generally and
to general principles of equity and the discretion of the court (regardless
of whether the enforcement of such remedies is considered in a proceeding in
equity or at law).

(c) No consent, approval or authorization of, or registration with
or notice to, any Delaware or federal banking authority is required for the
execution, delivery or performance by the Delaware Trustee, of the
Declaration.

(d) The Delaware Trustee is a natural person who is a resident of
the State of Delaware or, if not a natural person, an entity which has its
principal place of business in the State of Delaware.

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<PAGE>

ARTICLE XIV

MISCELLANEOUS

SECTION 14.1. NOTICES.

All notices provided for in this Declaration shall be in writing, duly
signed by the party giving such notice, and shall be delivered, telecopied or
mailed by first class mail, as follows:

(a) if given to the Trust, in care of the Regular Trustees at the
Trust's mailing address set forth below (or such other address as the Trust
may give notice of to the Holders of the Securities):

UnionBanCal Finance Trust /(5)/
c/o UnionBanCal Corporation
400 California Street
San Francisco, California 94104
Attention: General Counsel

(b) if given to the Delaware Trustee, at the mailing address set forth
below (or such other address as Delaware Trustee may give notice of to the
Holders of the Securities):

DELAWARE TRUSTEE
----------------

First Chicago Delaware, Inc.
300 King Street
Wilmington, DE 19801
Attention: Michael J. Majchrzak

PROPERTY TRUSTEE
----------------

The First National Bank of Chicago
One First National Plaza, Suite 0126
Chicago, IL 60670-0126
Attention: Corporate Trust Services Division

- ----------------------

(5) Insert I, II, III or IV as applicable.

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<PAGE>

(c) if given to the Property Trustee, at its Corporate Trust Office's
mailing address set forth below (or such other address as the Property Trustee
may give notice of to the Holders of the Securities).

_____________________________
_____________________________
_____________________________
Attention: _________________

(d) if given to the Holder of the Common Securities, at the mailing
address of the Sponsor set forth below (or such other address as the Holder of
the Common Securities may give notice to the Trust):

UnionBanCal Corporation
400 California Street
San Francisco, California 94104
Attention: General Counsel

(e) if given to any other Holder, at the address set forth on the
books and records of the Trust.

All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery
or cannot be delivered because of a changed address of which no notice was
given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.

SECTION 14.2. GOVERNING LAW.

THIS DECLARATION AND THE RIGHTS OF THE PARTIES HEREUNDER SHALL BE
GOVERNED BY AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE
AND ALL RIGHTS AND REMEDIES SHALL BE GOVERNED BY SUCH LAWS WITHOUT REGARD TO
PRINCIPLES OF CONFLICT OF LAWS.

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SECTION 14.3. INTENTION OF THE PARTIES.

It is the intention of the parties hereto that the Trust be classified
for United States federal income tax purposes as a grantor trust. The
provisions of this Declaration shall be interpreted to further this intention
of the parties.

SECTION 14.4. HEADINGS.

Headings contained in this Declaration are inserted for convenience of
reference only and do not affect the interpretation of this Declaration or
any provision hereof.

SECTION 14.5. SUCCESSORS AND ASSIGN.

Whenever in this Declaration any of the parties hereto is named or
referred to, the successors and assigns of such party shall be deemed to be
included, and all covenants and agreements in this Declaration by the Sponsor
and the Trustees shall bind and inure to the benefit of their respective
successors and assigns, whether so expressed.

SECTION 14.6. PARTIAL ENFORCEABILITY.

If any provision of this Declaration, or the application of such
provision to any Person or circumstance, shall be held invalid, the remainder
of this Declaration, or the application of such provision to persons or
circumstances other than those to which it is held invalid, shall not be
affected thereby.

SECTION 14.7. COUNTERPARTS.

This Declaration may contain more than one counterpart of the signature
page and this Declaration may be executed by the affixing of the signature of
each of the Trustees to one of such counterpart signature pages. All of such
counterpart signature pages shall be read as though one, and they shall have the
same force and effect as though all of the signers had signed a single signature
page.

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<PAGE>

IN WITNESS WHEREOF, the undersigned has caused these presents to be
executed as of the day and year first above written.

___________________________________________________
______________________, as Regular Trustee
Solely as trustee and not in an individual capacity

___________________________________________________
_____________________, as Regular Trustee
Solely as trustee and not in an individual capacity

FIRST CHICAGO DELAWARE INC., as Delaware
Trustee

By:
-----------------------------------------------
Name:
Title:

THE FIRST NATIONAL BANK OF CHICAGO,
as Property Trustee

By:
-----------------------------------------------
Name:
Title:

UNIONBANCAL CORPORATION, as Sponsor

By:
-----------------------------------------------
Name:
Title:

<PAGE>

ANNEX I

TERMS OF
____% TRUST [CONVERTIBLE] PREFERRED SECURITIES
_____% [CONVERTIBLE] COMMON SECURITIES

Pursuant to Section 7.1 of the Amended and Restated Declaration of
Trust, dated as of ____________ ____, ______ (as amended from time to time,
the "Declaration"), the designation, rights, privileges, restrictions,
preferences and other terms and provisions of the [Convertible] Preferred
Securities and the [Convertible] Common Securities are set out below (each
capitalized term used but not defined herein has the meaning set forth in the
Declaration):

1. DESIGNATION AND NUMBER.

(a) [CONVERTIBLE] PREFERRED SECURITIES. __________ [Convertible]
Preferred Securities of the Trust (__________ [Convertible] Preferred
Securities if the Underwriter's over-allotment option is exercised in full)
with an aggregate liquidation amount with respect to the assets of the Trust
of ______________ Dollars ($__________) (_____________ Dollars ($___________)
if the Underwriter's over-allotment option is exercised in full), and a
liquidation amount with respect to the assets of $____ per [convertible]
preferred security, are hereby designated for the purposes of identification
only as "___% Trust [Convertible] Preferred Securities" (the "Preferred
Securities"). The Preferred Security Certificates evidencing the Preferred
Securities shall be substantially in the form of Exhibit A-1 to the
Declaration, with such letters, numbers, notations, other means of
identification or designation or other changes or additions thereto or
deletions therefrom as may be required by ordinary usage, custom or practice
and such legends or endorsements required by law, state exchange rule and
agreements to which the Trust is subject, if any (provided that any such
notation, legend or endorsement is in a form acceptable to the Trust).

(b) [CONVERTIBLE] COMMON SECURITIES. ________ [Convertible] Common
Securities of the Trust (_________ [Convertible] Common Securities if the
Underwriter's over-allotment option is exercised in full) with an aggregate
liquidation amount with respect to the assets of the Trust of _____________
Dollars ($_________) (_____________ Dollars ($__________) if the
Underwriter's over-allotment option is exercised in full), and a liquidation
amount with respect to the assets of the Trust of $____ per [convertible]
common security, are hereby designated for the purposes of identification
only as "___% [Convertible] Common Securities" (the "Common Securities").
The Common Securities Certificates evidencing the Common Securities shall be
in the form of Exhibit A-2 to the Declaration, with such letters, numbers,
notations, other means of identification or designation or other changes or
additions thereto or deletions therefrom as may be required by ordinary
usage, custom or practice and such legends or endorsements required by law,
state exchange rule and agreements to which the Trust is subject, if any
(provided that any such notation, legend or endorsement is in a form
acceptable to the Trust).

I-2
<PAGE>

2. DISTRIBUTIONS.

(a) Distributions payable on each Security will be fixed at a rate
per annum of ___% (the "Coupon Rate") of the stated liquidation amount of
$___ per Security, such rate being the rate of interest payable on the Debt
Securities to be held by the Property Trustee. Distributions in arrears for
more than one quarter will bear interest thereon compounded quarterly at the
Coupon Rate (to the extent permitted by applicable law). The term
"Distributions" as used herein includes such interest payable unless
otherwise stated. A Distribution is payable only to the extent that payments
are made in respect of the Debt Securities held by the Property Trustee and
to the extent the Property Trustee has funds available therefor. The amount
of Distributions payable for any period will be computed for any full
quarterly Distribution period on the basis of a 360-day year of twelve 30-day
months, and for any period shorter than a full quarterly Distribution period
for which Distributions are computed, Distributions will be computed on the
basis of the actual number of days elapsed per 30-day month.

(b) Distributions on the Securities will be cumulative, will
accumulate from ____________ ____, ______ and will be payable quarterly in
arrears, on _______ ___, _________ ___, ___________ ____ and __________ ___
of each year, commencing on _________ ___, _____, except as otherwise
described below. So long as the Debt Security Issuer shall not be in default
in the payment of interest on the Debt Securities, the Debt Security Issuer
has the right under the Indenture to defer payments of interest on the Debt
Securities by extending the interest payment period from time to time on the
Debt Securities for a period not exceeding 20 consecutive quarters (each an
"Extension Period"), during which Extension Period no interest shall be due
and payable on the Debt Securities, PROVIDED THAT no Extension Period shall
last beyond the date of maturity or any redemption date of the Debt
Securities. As a consequence of such deferral, Distributions will also be
deferred. Despite such deferral, quarterly Distributions will continue to
accumulate with interest thereon (to the extent permitted by applicable law)
at the Coupon Rate compounded quarterly during any such Extension Period.
Prior to the termination of any such Extension Period, the Debt Security
Issuer may further extend such Extension Period; PROVIDED THAT such Extension
Period together with all such previous and further extensions thereof may not
exceed 20 consecutive quarters or extend beyond the maturity or any
redemption date of the Debt Securities. Payments of accumulated Distributions
and, to the extent permitted by applicable law, accumulated interest thereon
shall be payable on the Distribution payment date on which the relevant
Extension Period terminates and shall be payable to Holders as they appear on
the books and records of the Trust at the close of business on the record
date next preceding such Distribution payment date. Upon the termination of
any Extension Period and the payment of all amounts then due, the Debt
Security Issuer may commence a new Extension Period, subject to the above
requirements. Each Extension Period, if any, will end on an interest payment
date for the Debt Securities; such date will also be a Distribution payment
date for the Securities. In the event that the Debt Security Issuer
exercises its right to defer payment of interest, then during such Extension
Period the Debt Security Issuer shall not (a) declare or pay dividends on,
make distributions with respect to, or redeem, purchase or acquire, or make a
liquidation payment with respect to, any of its capital stock, or (b) make
any payment of interest, principal or premium, if any, on or repay,
repurchase or redeem any debt

I-3
<PAGE>

securities issued by the Debt Security Issuer (including other junior
subordinated debt securities) that rank PARI PASSU with or junior in interest
to the Debt Securities or make any guarantee payments with respect to the
foregoing or with respect to any guarantee by the Debt Security Issuer of the
debt securities of any subsidiary of the Debt Security Issuer if such
guarantee ranks PARI PASSU with or junior in interest to the Debt Securities
(other than (i) as a result of the exchange, redemption or conversion of one
class or series of the capital stock of the Debt Security Issuer (or any
capital stock of a subsidiary) for another class or series of the capital
stock of the Debt Security Issuer or any class or series of the indebtedness
of the Debt Security Issuer for any class or series of the capital stock of
the Debt Security Issuer, (ii) the purchase of fractional interests in shares
of the capital stock of the Debt Security Issuer pursuant to the conversion
or exchange provisions of such capital stock or the security being converted
into or exchanged for such capital stock, (iii) any dividend in the form of
stock, warrants, options o other rights where the dividend stock or the stock
issuable upon exercise of such warrants, options or other rights is the same
stock as that on which the dividend is being paid or ranks PARI PASSU with or
junior to such stock, (iv) any declaration of a dividend in connection with
the implementation of a shareholders' rights plan, or the issuance of stock
or other property under any such plan in the future, or the redemption or
repurchase of any such rights pursuant thereto, (v) payments under the
Securities Guarantees or under any similar guarantee of the Debt Security
Issuer for any class or series of the capital stock of the Debt Security
Issuer, and repurchases, redemptions or other acquisitions of shares of the
capital stock of the Debt Security issuer in connection with (1) any
employment contract, benefit plan or other similar arrangement with or for
the benefit of an one or more employees, officers, directors or consultants,
(2) a dividend reinvestment or shareholder stock purchase plan or (3) the
issuance of capital stock of the Debt Security Issuer (or securities
convertible or exercisable for such capital stock) as consideration in an
acquisition transaction entered into prior to such Extension Period).

(c) Distributions on the Preferred Securities will be payable to
the Holders thereof as they appear on the books and records of the Trust on
the relevant record dates. While the Preferred Securities remain in
book-entry only form, the relevant record dates shall be one Business Day
prior to the relevant payment dates which payment dates correspond to the
interest payments dates on the Debt Securities. Subject to any applicable
laws and regulations and the provisions of the Declaration, each such payment
in respect of the Preferred Securities will be made as described under the
heading "Book-Entry Only Issuance The Depository Trust Company" in the
Prospectus Supplement dated ____________, 1999, to the Prospectus dated
____________, 1999, (together, the "PROSPECTUS") included in the Registration
Statement on Form S-3 of the Sponsor, the Debt Security Issuer and the Trust.
The relevant record dates for the Common Securities, and, if the Preferred
Securities shall not continue to remain in book-entry form, the relevant
record dates for the Preferred Securities, shall conform to the rules of any
securities exchange on which the securities are listed and, if none, shall
be fifteen days prior to the relevant payment dates, which payment dates
correspond to the record and interest payment dates on the Debt Securities.
The relevant record dates for the Common Securities shall be the same record
dates as for the Preferred Securities. Distributions payable on any
Securities that are not punctually paid on any Distribution payment date, as
a result of the Debt Security Issuer having failed to make a payment under
the Debt Securities, will cease to be payable to the Person in whose name
such Securities are registered on

I-4
<PAGE>

the relevant record date, and such defaulted Distribution will instead be
payable to the Person in whose name such Securities are registered on the
special record date or other specified date determined in accordance with the
Indenture. If any date on which Distributions are payable on the Securities
is not a Business Day, then payment of the Distributions payable on such date
will be made on the next succeeding day that is a Business Day (and without
any interest or other payment in respect of any such delay) except that, if
such Business Day is in the next succeeding calendar year, such payment shall
be made on the immediately preceding Business Day, in each case with the same
force and effect as if made on such date.

[(d) In the event of an election by the Holder to convert its
Securities through the Conversion Agent into Common Stock pursuant to the terms
of the Securities as set forth in this Annex I to the Declaration, no payment,
allowance or adjustment shall be made with respect to accumulated and unpaid
Distributions on such Securities, or be required to be made; PROVIDED, HOWEVER,
that Holders of Securities at the close of business on any record date for the
payment of Distributions will be entitled to receive the Distributions payable
on such Securities on the corresponding payment date notwithstanding the
conversion of such Securities into Common Stock following such record date;
PROVIDED, FURTHER that if the date of any redemption of related Debt Securities
falls between such record date and such corresponding payment date, the amount
of such Distribution shall include accumulated and unpaid Distributions
accumulated to but excluding such date of redemption and such payment shall be
made to the converting holder.]

(e) In the event that there is any money or other property held by
or for the Trust that is not accounted for hereunder, such property shall be
distributed Pro Rata (as defined herein) among the Holders of the Securities.

3. LIQUIDATION DISTRIBUTION UPON DISSOLUTION.

The Debt Security Issuer will have the right at any time to cause the
Trust to be dissolved with the result that, after satisfaction of creditors
of the Trust, a Like Amount of Debt Securities will be distributed on a Pro
Rata basis to the Holders of the Preferred Securities and the Common
Securities in liquidation of such Holders' interests in the Trust, within 90
days following notice given to the Holders of the Preferred Securities,
subject to the Regular Trustees' receipt of an opinion of nationally
recognized independent counsel experienced in such matters to the effect that
the Holders will not recognize any income, gain or loss for United States
federal income tax purposes as a result of the dissolution of the Trust and
such distribution to Holders of Preferred Securities.

In the event of any voluntary or involuntary liquidation, dissolution,
winding-up or termination of the Trust (each a "Liquidation"), the Holders of
the Securities on the date of the Liquidation will be entitled to receive out
of the assets of the Trust available for distribution to Holders of
Securities after satisfaction of liabilities of creditors an amount equal to
the aggregate of the stated liquidation amount of $__ per Security plus
accumulated and unpaid Distributions thereon to the date of payment (such
amount being the "Liquidation Distribution"), unless, in connection with such
Liquidation, Debt Securities in an aggregate stated principal amount equal to
the aggregate

I-5
<PAGE>

stated liquidation amount of such Securities, with an interest rate equal to
the Coupon Rate of, and bearing accumulated and unpaid interest in an amount
equal to the accumulated and unpaid Distributions on, such Securities, shall
have been distributed on a Pro Rata basis to the Holders of the Securities in
exchange for such Securities.

If, upon any such Liquidation, the Liquidation Distribution can be
paid only in part because the Trust has insufficient assets available to pay
in full the aggregate Liquidation Distribution, then the amounts payable
directly by the Trust on the Securities shall be paid on a Pro Rata basis.

If the Debt Securities are distributed to the Holders of the
Securities, pursuant to the terms of the Indenture, the Debt Security Issuer
will use its best efforts to have the Debt Securities listed on the New York
Stock Exchange or on such other exchange as the Preferred Securities were
listed on immediately prior to the distribution of the Debt Securities.

4. REDEMPTION AND DISTRIBUTION.

(a) The Debt Securities will mature on _________ ___, _____, and
may be redeemed, in whole or in part, {at any time on or after ___________
____, _____,}. Upon the repayment of the Debt Securities in whole or in
part, whether at maturity, upon redemption or otherwise, the proceeds from
such repayment or payment shall be simultaneously applied to redeem a Like
Amount of Securities at a redemption price per Security equal to the
redemption price of the Debt Securities, together with accumulated and unpaid
Distributions thereon to, but excluding, the date of the redemption, payable
in cash (the "Redemption Price"). Holders will be given not less than 30 nor
more than 60 days' notice of such redemption.

(b) If fewer than all the outstanding Securities are to be so
redeemed, the Common Securities and the Preferred Securities will be redeemed
Pro Rata and the Preferred Securities to be redeemed will be as described in
Section 4(f) below.

(c) If, at any time, a Tax Event, an Investment Company Event or a
Regulatory Capital Event (each, as defined below, a "Special Event") shall
occur and be continuing, the Debt Security Issuer shall have the right,
subject to the prior approval of the Federal Reserve if such approval is then
required under applicable capital guidelines or policies, upon not less than
30 nor more than 60 days' notice, to redeem the Debt Securities in whole (not
in part) at a redemption price equal to 100% of the principal amount thereof
plus accumulated and unpaid interest thereon, for cash within 90 days
following the occurrence of such Special Event. Following such redemption, a
Like Amount of Securities shall be redeemed by the Trust at the Redemption
Price on a Pro Rata basis.

"Tax Event" means that the Regular Trustees shall have received an
opinion of nationally recognized independent tax counsel experienced in such
matters (a "Tax Opinion") to the effect that on or after __________ ___,
____, as a result of (a) any amendment to, clarification of, or change
(including any announced prospective change) in the laws (or any regulations
thereunder) of the United States or any political subdivision or taxing
authority thereof or therein affecting taxation,

I-6
<PAGE>

(b) any judicial decision, official administrative pronouncement, ruling,
regulatory procedure, notice or announcement, including any notice or
announcement of intent to adopt such procedures or regulations (an
"Administrative Action") or (c) any amendment to, clarification of, or change
in the official position or the interpretation of such Administrative Action
or judicial decision that differs from the theretofore generally accepted
position, in each case, by any legislative body, court, governmental
authority or regulatory body, irrespective of the manner in which such
amendment, clarification, change or Administrative Action is made known,
which amendment, clarification, change or Administrative Action is effective
or such pronouncement or decision is announced, in each case, on or after,
________ ___, ____, there is the creation by such amendment, clarification,
change or Administrative Action of more than an insubstantial risk that (i)
the Trust is, or will be within 90 days of the date thereof, subject to
United States federal income tax with respect to income accumulated or
received on the Debt Securities, (ii) the Trust is, or will be within 90 days
of the date thereof, subject to more than a de minimis amount of taxes (other
than withholding taxes), duties or other governmental charges, or (iii)
interest paid in cash by the Debt Security Issuer to the Trust on the Debt
Securities is not, or within 90 days of the date thereof will not be,
deductible, in whole or in part, by the Debt Security Issuer for United
States federal income tax purposes. Notwithstanding the foregoing, a Tax
Event shall not include any change in tax law that requires the Debt Security
Issuer for United States federal income tax purposes to defer taking a
deduction for any original issue discount ("OID") that accumulates with
respect to the Debt Securities until the interest payment related to such OID
is paid by the Debt Security Issuer in cash; PROVIDED, that such change in
tax law does not create more than an insubstantial risk that the Debt
Security Issuer will be prevented from taking a deduction for OID accruing
with respect to the Debt Securities at a date that is no later than the date
the interest payment related to such OID is actually paid by the Debt
Security Issuer in cash.

"Investment Company Event" means that the Regular Trustees shall have
received an opinion of nationally recognized independent counsel experienced
in such matters to the effect that, as a result of the occurrence of a change
(including a prospective change) in law or regulation or a written change
(including a prospective change) in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory
authority on or after _________ ___, _____ (a "Change in 1940 Act Law"),
there is more than an insubstantial risk that the Trust is or will be
considered an "investment company" that is required to be registered under
the Investment Company Act of 1940, as amended (the "1940 Act").

"Regulatory Capital Event" means that the Sponsor shall have received
an opinion of nationally recognized independent counsel experienced in such
matters that, as a result of (a) any amendment to, clarification of or change
(including any announced prospective change) in applicable laws or
regulations or official interpretations thereof or policies with respect
thereto or (b) any official administrative pronouncement or judicial decision
interpreting or applying such laws or regulations, which amendment,
clarification, change, pronouncement or decision is announced or is effective
after the date of issuance of the Preferred Securities, there is more than an
insubstantial risk that the Preferred Securities will no longer constitute
Tier I capital of the Sponsor for purposes of the capital adequacy guidelines
or policies of the Federal Reserve or its successor as the Sponsor's primary
federal banking regulator.

I-7
<PAGE>

After the date fixed by the Regular Trustees for any distribution of
Debt Securities upon dissolution of the Trust: (i) the Securities will no
longer be deemed to be outstanding, (ii) The Depository Trust Company (the
"Depositary") or its nominee (or any successor Clearing Agency or its
nominee), as the record Holder of the Preferred Securities held in global
form, will receive a registered certificate or certificates representing the
Debt Securities held in global form to be delivered upon such distribution,
and (iii) certificates representing Securities held in definitive form,
except for certificates representing Preferred Securities held by the
Depositary or its nominee (or any successor Clearing Agency or its nominee),
will be deemed to represent Debt Securities having an aggregate principal
amount equal to the aggregate stated liquidation amount of, with an interest
rate identical to the Coupon Rate of, and accumulated and unpaid interest
(including Compound Interest (as defined in the Indenture)) equal to
accumulated and unpaid Distributions on such Securities until such
certificates are presented to the Debt Security Issuer or its agent for
transfer or reissue.

(d) The Trust may not redeem fewer than all the outstanding
Securities unless all accumulated and unpaid Distributions have been paid on
all Securities for all quarterly Distribution periods terminating on or prior
to the date of redemption.

(e) (i) Notice of any redemption of, or notice of distribution of
Debt Securities in exchange for, the Securities (a
"Redemption/Distribution Notice") will be given by the Trust by mail to
each Holder of Securities to be redeemed or exchanged not fewer than 30
nor more than 60 days before the date fixed for redemption or exchange
thereof which, in the case of a redemption, will be the date fixed for
redemption of the Debt Securities. For purposes of the calculation of
the date of redemption or exchange and the dates on which notices are
given pursuant to this Section 4(e), a Redemption/Distribution Notice
shall be deemed to be given on the day such notice is first mailed by
first-class mail, postage prepaid, or by such other means suitable to
assure delivery of such written notice, to Holders of Securities. Each
Redemption/Distribution Notice shall be addressed to the Holders of
Securities at the address of each such Holder appearing in the books and
records of the Trust. No defect in the Redemption/Distribution Notice or
in the mailing of either thereof with respect to any Holder of Securities
shall affect the validity of the redemption or exchange proceedings with
respect to any other Holder of Securities.

(ii) In addition to the Redemption/Distribution Notice to be
provided to the Holders of Securities pursuant to clause (i) of this
Section 4(e), the Debt Security Issuer or the Trust shall give public
notice of any such redemption by the issuance of a press release through
the services of the Dow Jones Broad Tape, Reuters News Service and
Bloomberg News Service.

(f) In the event that fewer than all the outstanding Securities are
to be redeemed, the particular Preferred Securities to be redeemed shall be
selected on a Pro Rata basis not more than 60 days prior to the Redemption
Date from the outstanding Preferred Securities not previously called for
redemption, by such method as the Property Trustee shall deem fair and
appropriate, or if the Preferred Securities are then held in book-entry form,
in accordance with the Depositary's customary

I-8
<PAGE>

procedures, it being understood that, in respect of Preferred Securities
registered in the name of and held of record by the Depositary or its nominee
(or any successor Clearing Agency or its nominee) or any nominee, the
distribution of the proceeds of such redemption will be made to each Clearing
Agency Participant (or Person on whose behalf such nominee holds such
securities) in accordance with the procedures applied by such agency or
nominee. The Property Trustee shall promptly notify the securities registrar
for the Securities in writing of the Preferred Securities selected for
redemption.

(g) If Securities are to be redeemed and the Trust gives a
Redemption/Distribution Notice, which notice may only be issued for a
redemption if the Debt Securities are redeemed as set out in the Indenture
(which notice will be irrevocable), then (i) with respect to Preferred
Securities held in book-entry form by 12:00 noon, New York City time, on the
redemption date, provided that the Debt Security Issuer has paid the Property
Trustee a sufficient amount of cash in connection with the related redemption
of the Debt Securities, the Property Trustee will deposit irrevocably with
the Depositary or its nominee (or successor Clearing Agency or its nominee)
funds sufficient to pay the applicable Redemption Price with respect to such
Preferred Securities and will give the Depository irrevocable instructions
and authority to pay the Redemption Price to the Holders of such Preferred
Securities, and (ii) with respect to Preferred Securities issued in
definitive form and Common Securities, provided that the Debt Security Issuer
has paid the Property Trustee a sufficient amount of cash in connection with
the related redemption of the Debt Securities, the Property Trustee will pay
the relevant Redemption Price to the Holders of such Securities by check
mailed to the address of the relevant Holder appearing on the books and
records of the Trust on the redemption date. If a Redemption/Distribution
Notice shall have been given in connection with a redemption and funds
deposited as required, then from and after the required date of such deposit,
distributions will cease to accumulate on the Securities so called for
redemption and all rights of Holders of such Securities so called for
redemption will cease, except the right of the Holders of such Securities to
receive the Redemption Price, but without interest on such Redemption Price.
If any date fixed for redemption of Securities is not a Business Day, then
payment of the Redemption Price payable on such date will be made on the next
succeeding Business Day (and without any interest or other payment in respect
of any such delay) except that, if such Business Day falls in the next
calendar year, such payment will be made on the immediately preceding
Business Day, in each case with the same force and effect as if made on such
date fixed for redemption. If payment of the Redemption Price in respect of
any Securities is improperly withheld or refused and not paid either by the
Property Trustee or by the Sponsor as guarantor pursuant to the relevant
Securities Guarantee, Distributions on such Securities will continue to
accumulate from the original redemption date to the actual date of payment,
in which case the actual payment date will be considered the date fixed for
redemption for purposes of calculating the Redemption Price.

Neither the Regular Trustees nor the Trust shall be required (i) in
the event of any redemption in part, to issue, register the transfer of or
exchange any Securities during a period beginning at the opening of business
15 days before any selection for redemption of Securities and ending at the
close of business on the earliest date in which the relevant
Redemption/Distribution Notice is deemed to have been given to all holders of
Securities to be so redeemed or (ii) to register the transfer of or

I-9
<PAGE>

exchange any Securities selected for redemption, in whole or in part, except
for the unredeemed portion of any Securities being redeemed in part.

(h) Redemption/Distribution Notices shall be sent by the Regular
Trustees on behalf of the Trust to (i) in respect of Preferred Securities
held in global form, the Depositary or its nominee (or any successor Clearing
Agency or its nominee), (ii) with respect to Preferred Securities held in
definitive form, to the Holders thereof, and (iii) in respect of the Common
Securities, to the Holders thereof.

(i) Subject to the foregoing and applicable law (including, without
limitation, United States federal securities laws), the Sponsor or any of its
subsidiaries may at any time and from time to time purchase outstanding
Preferred Securities by tender, in the open market or otherwise.

[5. CONVERSION RIGHTS.

The Holders of Securities shall have the right at any time, beginning
________ ___, ____ through the close of business on ________ ___, ____ (or,
in the case of Securities called for redemption, prior to the close of
business on the Business Day prior to the redemption date), at their option,
to cause the Conversion Agent to convert Securities, on behalf of the
converting Holders, into shares of Common Stock in the manner described
herein on and subject to the following terms and conditions:

(a) The Securities will be convertible at the office of the
Conversion Agent into fully paid and nonassessable shares of Common Stock
pursuant to the Holder's direction to the Conversion Agent to exchange such
Securities for a portion of the Debt Securities theretofore held by the Trust
on the basis of one Security per $___ principal amount of Debt Securities,
and immediately convert such amount of Debt Securities into fully paid and
nonassessable shares of Common Stock at an initial rate of ____ shares of
Common Stock per $____ principal amount of Debt Securities (which is
equivalent to a conversion price of $_____ per share of Common Stock, subject
to certain adjustments set forth in the Indenture (as so adjusted,
"Conversion Price")).

(b) In order to convert Securities into Common Stock, the Holder
shall submit to the Conversion Agent at its office an irrevocable request to
convert Securities on behalf of such Holder (the "Conversion Request"),
together, if the Securities are in certificated form, with such certificates.
The Conversion Request shall (i) set forth the number of Securities to be
converted and the name or names, if other than the Holder, in which the
shares of Common Stock should be issued and (ii) direct the Conversion Agent
(a) to exchange such Securities for a portion of the Debt Securities held by
the Trust (at the rate of exchange specified in the preceding paragraph) and
(b) to immediately convert such Debt Securities on behalf of such Holder,
into Common Stock (at the conversion rate specified in the preceding
paragraph). The Conversion Agent shall notify the Trust of the Holder's
election to exchange Securities for a portion of the Debt Securities held by
the Trust and the Trust shall, upon receipt of such notice, deliver to the
Conversion Agent the appropriate principal amount of Debt Securities for
exchange in accordance with this Section. The Conversion Agent shall

I-10
<PAGE>

thereupon notify UNBC of the Holder's election to convert such Debt
Securities into shares of Common Stock. Holders of Securities at the close
of business on a Distribution record date will be entitled to receive the
Distribution payable on such securities on the corresponding Distribution
payment date notwithstanding the conversion of such Securities following such
record date but prior to such distribution payment date; PROVIDED, HOWEVER,
that if the date of any redemption of the related Debt Securities falls
between such record date and the related Distribution payment date, the
amount of such Distribution shall include accumulated and unpaid
Distributions accumulated to but excluding such date of redemption, and such
payment shall be made to the converting Holder. Except as provided above,
neither the Trust nor the Sponsor will make, or be required to make, any
payment, allowance or adjustment upon any conversion on account of any
accumulated and unpaid Distributions accumulated on the Securities (including
any Additional Amounts accumulated thereon) surrendered for conversion, or on
account of any accumulated and unpaid dividends on the shares of Common Stock
issued upon such conversion, except to the extent that such shares are held
of record on the record date for any such distributions. Securities shall be
deemed to have been converted immediately prior to the close of business on
the day on which a Notice of Conversion relating to such Securities is
received by the Trust in accordance with the foregoing provision (the
"Conversion Date"). The Person or Persons entitled to receive Common Stock
issuable upon conversion of the Debt Securities shall be treated for all
purposes as the record holder or holders of such Common Stock at such time.
As promptly as practicable on or after the Conversion Date, UNBC shall issue
and deliver at the office of the Conversion Agent a certificate or
certificates for the number of full shares of Common Stock issuable upon such
conversion, together with the cash payment, if any, in lieu of any fraction
of any share to the Person or Persons entitled to receive the same, unless
otherwise directed by the Holder in the notice of conversion and the
Conversion Agent shall distribute such certificate or certificates to such
Person or Persons.

(c) Each Holder of a Security by his acceptance thereof appoints
_________________ as "Conversion Agent" for the purpose of effecting the
conversion of Securities in accordance with this Section. In effecting the
conversion and transactions described in this Section, the Conversion Agent
shall be acting as agent of the Holders of Securities directing it to effect
such conversion transactions. The Conversion Agent is hereby authorized (i)
to exchange Securities from time to time for Debt Securities held by the
Trust in connection with the conversion of such Securities in accordance with
this Section and (ii) to convert all or a portion of the Debt Securities into
Common Stock and thereupon to deliver such shares of Common Stock in
accordance with the provisions of this Section and to deliver to the Trust a
new Debt Security or Debt Securities for any resulting unconverted principal
amount.

(d) No fractional shares of Common Stock will be issued as a result
of conversion of Securities, but in lieu thereof such fractional interest
will be paid in cash by UNBC, in an amount based on the Closing Price of the
Common Stock on the date such Securities are surrendered for conversion, to
the Conversion Agent, which in turn will make such payment to the Holder or
Holders of Securities so converted.

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<PAGE>

(e) UNBC shall at all times reserve and keep available out of its
authorized and unissued Common Stock, solely for issuance upon the conversion
of the Debt Securities, free from any preemptive or other similar rights,
such number of shares of Common Stock as shall from time to time be issuable
upon the conversion of all the Debt Securities then outstanding.
Notwithstanding the foregoing, UNBC shall be entitled to deliver upon
conversion of Debt Securities, shares of Common Stock reacquired and held in
the treasury of UNBC (in lieu of the issuance of authorized and unissued
shares of Common Stock), so long as any such treasury shares are free and
clear of all liens, charges, security interests or encumbrances. Any shares
of Common Stock issued upon conversion of the Debt Securities shall be duly
authorized, validly issued and fully paid and nonassessable. The Trust shall
deliver the shares of Common Stock received upon conversion of the Debt
Securities to the converting Holder free and clear of all liens, charges,
security interests and encumbrances, except for United States withholding
taxes. Each of UNBC and the Trust shall prepare and shall use its best
efforts to obtain and keep in force such governmental or regulatory permits
or other authorizations as may be required by law, and shall comply with all
applicable requirements as to registration or qualification of Common Stock
(and all requirements to list Common Stock issuable upon conversion of Debt
Securities that are at the time applicable), in order to enable UNBC to
lawfully issue Common Stock to the Trust upon conversion of the Debt
Securities and the Trust to lawfully deliver Common Stock to each Holder upon
conversion of the Securities.

(f) UNBC will pay any and all taxes that may be payable in respect
of the issue or delivery of shares of Common Stock on conversion of Debt
Securities and the delivery of the shares of Common Stock by the Trust upon
conversion of the Securities. UNBC shall not, however, be required to pay
any tax which may be payable in respect of any transfer involved in the issue
and delivery of shares of Common Stock in a name other than that in which the
Securities so converted were registered, and no such issue or delivery shall
be made unless and until the person requesting such issue has paid to the
Trust the amount of any such tax, or has established to the satisfaction of
the Trust that such tax has been paid.

(g) Nothing in the preceding Paragraph (f) shall limit the
requirement of the Trust to withhold taxes pursuant to the terms of the
Securities or as set forth in this Annex I to the Declaration or to the
Declaration itself or otherwise require the Property Trustee or the Trust to
pay any amounts on account of such withholdings.

(h) The term "Closing Price" with respect to any security on any
day means the last reported sale price, regular way on such day, or, if no
sale takes place on such day, the average of the reported closing bid and
asked prices on such day, regular way, in either case as reported on the NYSE
Composite Tape, or, if such security is not listed or admitted to trading on
the NYSE, on the principal national securities exchange on which such
security is listed or admitted to trading, or, if such security is not listed
or admitted to trading on a national securities exchange, on the principal
interdealer quotation system on which such security is listed or admitted to
trading or quoted, or, if not listed or admitted to trading or quoted on any
national securities exchange or interdealer quotation system, the average of
the closing bid and asked prices of such security in the over-the-

I-12
<PAGE>

counter market on the day in question as reported by the National Quotation
Bureau Incorporated, or a similar generally accepted reporting service, or,
if not so available in such manner, as furnished by any NYSE member firm
selected from time to time by the Board of Directors (or any committee duly
authorized by the Board of Directors) of the Debt Security Issuer for that
purpose or, if not so available in such manner, as otherwise determined in
good faith by the Board of Directors (or any committee duly authorized by the
Board of Directors) of the Debt Security Issuer.]

6. VOTING AND OTHER RIGHTS - PREFERRED SECURITIES.

(a) Except as provided under Section 8 of this Annex I to the
Declaration and as otherwise required by law, the Preferred Securities
Guarantee and the Declaration, the Holders of the Preferred Securities will
not have voting rights.

(b) Subject to the requirements set forth in this paragraph, the
Holders of a Majority in liquidation amount of the Preferred Securities then
outstanding, voting separately as a class, may direct the time, method, and
place of conducting any proceeding for any remedy available to the Property
Trustee, or may direct the exercise of any trust or power conferred upon the
Property Trustee under the Declaration, including the right to direct the
Property Trustee, as holder of the Debt Securities, to (i) exercise the
remedies available under the Indenture with respect to the Debt Securities,
(ii) waive any past default and its consequences that are waivable under the
Indenture, (iii) exercise any right to rescind or annul a declaration that
the principal of all the Debt Securities shall be due and payable, or (iv) in
accordance with Section 8 hereof, consent to any amendment, modification or
termination of the Indenture where consent is required, PROVIDED, HOWEVER,
that if an Event of Default under the Indenture has occurred and is
continuing then the holders of 25% of the aggregate liquidation amount of the
Preferred Securities then outstanding may direct the Property Trustee to
declare the principal of and interest on the Debt Securities immediately due
and payable; and PROVIDED, FURTHER, that, where a consent under the Indenture
would require the consent or act of the Holders of greater than a majority of
the Holders in principal amount of Debt Securities then outstanding (a "Super
Majority") affected thereby, the Property Trustee may only give such consent
or take such action at the written direction of the Holders of at least the
proportion in liquidation amount of the Preferred Securities which the
relevant Super Majority represents of the aggregate principal amount of the
Debt Securities then outstanding. The Property Trustee shall not revoke any
action previously authorized or approved by a vote of the Holders of the
Preferred Securities. Other than with respect to directing the time, method
and place of conducting any remedy available to the Property Trustee as set
forth above, the Property Trustee shall not take any action in accordance
with the directions of the Holders of the Preferred Securities under this
paragraph unless the Property Trustee has obtained an opinion of nationally
recognized independent tax counsel experienced in such matters to the effect
that for United States federal income tax purposes, such action will not
cause the Trust to be classified as other than a grantor trust. If the
Property Trustee fails to enforce its rights under the Debt Securities, any
Holder of Preferred Securities may institute a legal proceeding against any
person to enforce the Property Trustee's rights under the Debt Securities.
If an Event of Default has occurred and is continuing and such event is
attributable to the failure of the Debt Security Issuer to pay interest or
principal on the Debt Securities on the date such interest or

I-13
<PAGE>

principal is otherwise payable (or in the case of redemption, on the
redemption date), then a Holder of Preferred Securities may directly
institute a proceeding for enforcement of payment to such Holder of the
principal of or interest on the Debt Securities having a principal amount
equal to the aggregate liquidation amount of the Preferred Securities of such
Holder (a "Direct Action") on or after the respective due date specified in
the Debt Securities. In connection with such Direct Action, the rights of
the Holders of Common Securities will be subrogated to the rights of such
Holder of Preferred Securities to the extent of any payment made by the
Issuer to such Holder of Preferred Securities in such Direct Action. Except
as provided in the preceding sentences, the Holders of Preferred Securities
will not be able to exercise directly any other remedy available to the
holders of the Debt Securities.

The Property Trustee shall notify all Holders of the Preferred
Securities of any notice of default received from the trustee under the
Indenture with respect to the Debt Securities. Such notice shall state that
such event of default also constitutes and Event of Default under the
Declaration.

Any approval or direction of Holders of Preferred Securities may be
given at a separate meeting of Holders of Preferred Securities convened for
such purpose, at a meeting of all of the Holders of Securities in the Trust
or pursuant to written consent. The Regular Trustees will cause a notice of
any meeting at which Holders of Preferred Securities are entitled to vote, or
of any matter upon which action by written consent of such Holders is to be
taken, to be mailed to each Holder of record of Preferred Securities. Each
such notice will include a statement setting forth (i) the date of such
meeting or the date by which such action is to be taken, (ii) a description
of any resolution proposed for adoption at such meeting on which such Holders
are entitled to vote or of such matter upon which written consent is sought
and (iii) instructions for the delivery of proxies or consents.

No vote or consent of the Holders of the Preferred Securities will be
required for the Trust to redeem and cancel Preferred Securities or to
distribute the Debt Securities in accordance with the Declaration and the
terms of the Securities.

Notwithstanding that Holders of Preferred Securities are entitled to
vote or consent under any of the circumstances described above, any of the
Preferred Securities that are owned by the Sponsor or any Affiliate of the
Sponsor shall not be entitled to vote or consent and shall, for purposes of
such vote or consent, be treated as if they were not outstanding.

7. VOTING RIGHTS - COMMON SECURITIES.

(a) Except as provided under Sections 7(b), 7(c) and 8 of this
Annex I of the Declaration and as otherwise required by law and the
Declaration, the Holders of the Common Securities will not have voting rights.

(b) The Holders of the Common Securities are entitled, in
accordance with Article V of the Declaration, to vote to appoint, remove or
replace any Trustee or to increase or decrease the number of Trustees.

I-14
<PAGE>

(c) Subject to Section 2.6 of the Declaration and only after any
Event of Default with respect to the Preferred Securities has been cured,
waived, or otherwise eliminated and subject to the requirements of the second
to last sentence of this paragraph, the Holders of a Majority in liquidation
amount of the Common Securities, voting separately as a class, may direct the
time, method, and place of conducting any proceeding for any remedy available
to the Property Trustee, or exercising any trust or power conferred upon the
Property Trustee under the Declaration, including (i) directing the time,
method, place of conducting any proceeding for any remedy available to the
Debt Security Trustee, or exercising any trust or power conferred on the Debt
Security Trustee with respect to the Debt Securities, (ii) waive any past
default and its consequences that are waivable under the Indenture, (iii)
exercise any right to rescind or annul a declaration that the principal of
all the Debt Securities shall be due and payable, PROVIDED THAT, where a
consent or action under the Indenture would require the consent or act of the
relevant Super Majority, the Property Trustee may only give such consent or
take such action at the written direction of the Holders of at least the
proportion in liquidation amount of the Common Securities which the relevant
Super Majority represents of the aggregate principal amount of the Debt
Securities outstanding. The Property Trustee shall not revoke any action
previously authorized or approved by a vote of the Holders of the Preferred
Securities. Other than with respect to directing the time, method and place
of conducting any remedy available to the Property Trustee or the Debt
Security Trustee as set forth above, the Property Trustee shall not take any
action in accordance with the directions of the Holders of the Common
Securities under this paragraph unless the Property Trustee has obtained an
opinion of nationally recognized independent tax counsel experienced in such
matters to the effect that for United States federal income tax purposes,
such action will not cause the Trust to be classified as other than a grantor
trust. If the Property Trustee fails to enforce its rights under the
Declaration, any Holder of Common Securities may institute a legal proceeding
directly against any Person to enforce the Property Trustee's rights under
the Declaration, without first instituting a legal proceeding against the
Property Trustee or any other Person.

Any approval or direction of Holders of Common Securities may be given
at a separate meeting of Holders of Common Securities convened for such
purpose, at a meeting of all of the Holders of Securities in the Trust or
pursuant to written consent. The Regular Trustees will cause a notice of any
meeting at which Holders of Common Securities are entitled to vote, or of any
matter upon which action by written consent of such Holders is to be taken,
to be mailed to each Holder of record of Common Securities. Each such notice
will include a statement setting forth (i) the date of such meeting or the
date by which such action is to be taken, (ii) a description of any
resolution proposed for adoption at such meeting on which such Holders are
entitled to vote or of such matter upon which written consent is sought and
(iii) instructions for the delivery of proxies or consents.

No vote or consent of the Holders of the Common Securities will be
required for the Trust to redeem and cancel Common Securities or to
distribute the Debt Securities in accordance with the Declaration and the
terms of the Securities.

I-15
<PAGE>

8. AMENDMENTS TO DECLARATION AND INDENTURE.

(a) In addition to any requirements under Section 12.1 of the
Declaration, if any proposed amendment to the Declaration provides for, or
the Regular Trustees otherwise propose to effect, (i) any action that would
adversely affect the powers, preferences or special rights of the Securities,
whether by way of amendment to the Declaration or otherwise, or (ii) the
dissolution, winding-up or termination of the Trust, other than as described
in Section 8.1 of the Declaration, then the Holders of outstanding Securities
voting together as a single class, will be entitled to vote on such amendment
or proposal (but not on any other amendment or proposal) and such amendment
or proposal shall not be effective except with the approval of the Holders of
at least a Majority in liquidation amount of the Securities then outstanding
affected thereby; PROVIDED, HOWEVER, if any amendment or proposal referred to
in clause (i) above would adversely affect only the Preferred Securities or
only the Common Securities, then only the affected class will be entitled to
vote on such amendment or proposal and such amendment or proposal shall not
be effective except with the approval of a Majority in liquidation amount of
such class of Securities then outstanding.

(b) In the event the consent of the Property Trustee as the holder
of the Debt Securities is required under the Indenture with respect to any
amendment, modification or termination of the Indenture or the Debt
Securities, the Property Trustee shall request the written direction of the
Holders of the Securities with respect to such amendment, modification or
termination and shall vote with respect to such amendment, modification or
termination as directed by a Majority in liquidation amount of the Securities
then outstanding, voting together as a single class; PROVIDED, HOWEVER, that
where a consent under the Indenture would require the consent of the relevant
Super Majority, the Property Trustee may only give such consent at the
direction of the Holders of at least the proportion in liquidation amount of
the Securities then outstanding which the relevant Super Majority represents
of the aggregate principal amount of the Debt Securities then outstanding;
PROVIDED, FURTHER, that the Property Trustee shall not take any action in
accordance with the directions of the Holders of the Securities under this
Section 8(b) unless the Property Trustee has obtained an opinion of
nationally recognized independent tax counsel experienced in such matters to
the effect that for United States federal income tax purposes, such action
will not cause the Trust to be classified as other than a grantor trust.

9. PRO RATA.

A reference in these terms of the Securities to any distribution or
treatment as being "Pro Rata" shall mean pro rata to each Holder of
Securities according to the aggregate liquidation amount of the Securities
held by the relevant Holder in relation to the aggregate liquidation amount
of all Securities outstanding unless, in relation to a payment, an Event of
Default under the Declaration has occurred and is continuing, in which case
any funds available to make such payment shall be paid first in cash to each
Holder of the Preferred Securities pro rata

I-16
<PAGE>

according to the aggregate liquidation amount of Preferred Securities held by
the relevant Holder relative to the aggregate liquidation amount of all
Preferred Securities outstanding, and only after satisfaction of all amounts
owed to the Holders of the Preferred Securities, to each Holder of Common
Securities pro rata according to the aggregate liquidation amount of Common
Securities held by the relevant Holder relative to the aggregate liquidation
amount of all Common Securities outstanding.

10. RANKING.

The Preferred Securities rank PARI PASSU and payment thereon shall be
made Pro Rata with the Common Securities except that, where an Event of
Default occurs and is continuing, the rights of Holders of the Common
Securities to payment in respect of Distributions and payments upon
liquidation, redemption and otherwise are subordinated to the rights to
payment of the Holders of the Preferred Securities.

11. LISTING.

The Regular Trustees shall use their best efforts to cause the
Preferred Securities to be listed on the New York Stock Exchange.

12. ACCEPTANCE OF SECURITIES GUARANTEE AND INDENTURE.

Each Holder of Preferred Securities and Common Securities, by the
acceptance thereof, agrees to the provisions of the Preferred Securities
Guarantee and the Common Securities Guarantee, respectively, including the
subordination provisions therein and to the provisions of the Indenture.

13. NO PREEMPTIVE RIGHTS.

The Holders of the Securities shall have no preemptive rights to
subscribe for any additional securities.

14. MISCELLANEOUS.

These terms constitute a part of the Declaration. The Sponsor will
provide a copy of the Declaration, the Preferred Securities Guarantee or the
Common Securities Guarantee (as may be appropriate), and the Indenture to a
Holder without charge on written request to the Sponsor at its principal
place of business.

15. GOVERNING LAW.

These terms and the rights of the parties hereunder shall be governed by
and interpreted in accordance with the laws of the State of Delaware, and all
rights and remedies shall be governed by such laws without regard to principals
of conflict of laws.

I-17
<PAGE>

EXHIBIT A-1

{FORM OF [CONVERTIBLE] PREFERRED SECURITY CERTIFICATE}

{IF THE [CONVERTIBLE] PREFERRED SECURITY IS TO BE A GLOBAL CERTIFICATE
INSERT - THIS [CONVERTIBLE] PREFERRED SECURITY IS A GLOBAL CERTIFICATE WITHIN
THE MEANING OF THE DECLARATION HEREINAFTER REFERRED TO AND IS REGISTERED IN
THE NAME OF THE DEPOSITORY TRUST COMPANY (THE "DEPOSITARY") OR A NOMINEE OF
THE DEPOSITARY. THIS [CONVERTIBLE] PREFERRED SECURITY IS EXCHANGEABLE FOR
[CONVERTIBLE] PREFERRED SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER
THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES
DESCRIBED IN THE DECLARATION AND NO TRANSFER OF THIS [CONVERTIBLE] PREFERRED
SECURITY (OTHER THAN A TRANSFER OF THIS [CONVERTIBLE] PREFERRED SECURITY AS A
WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE
REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.

UNLESS THIS [CONVERTIBLE] PREFERRED SECURITY IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET,
NEW YORK, NEW YORK) TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY [CONVERTIBLE] PREFERRED SECURITY ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY A PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.}

CERTIFICATE NUMBER:

NUMBER OF [CONVERTIBLE] PREFERRED SECURITIES:

CUSIP NO.:

Certificate Evidencing [Convertible] Preferred Securities

A1-1
<PAGE>

UNIONBANCAL UnionBanCal Finance Trust /(6)/

____% Trust [Convertible] Preferred Securities
(liquidation amount $___ per Trust [Convertible] Preferred Security)

UnionBanCal Finance Trust /(6)/, a statutory business trust formed under
the laws of the State of Delaware (the "Trust"), hereby certifies that
____________________ (the "Holder") is the registered owner of [convertible]
preferred securities of the Trust representing undivided beneficial interests
in the assets of the Trust designated the ___% Trust [Convertible] Preferred
Securities (liquidation amount $____ per Trust [Convertible] Preferred
Security) (the "Preferred Securities"). The Preferred Securities are
transferable on the books and records of the Trust, in person or by a duly
authorized attorney, upon surrender of this certificate duly endorsed and in
proper form for transfer.

The designation, rights, privileges, restrictions, preferences and
other terms and provisions of the Preferred Securities represented hereby are
issued and shall in all respects be subject to the provisions of the Amended
and Restated Declaration of Trust of the Trust dated as of ___________ ___,
_____, as the same may be amended from time to time (the "Declaration"),
including the designation of the terms of the Preferred Securities as set
forth in Annex I to the Declaration.

Capitalized terms used herein but not defined shall have the meaning
given them in the Declaration. The Holder is entitled to the benefits of the
Preferred Securities Guarantee to the extent provided therein. The Sponsor
will provide a copy of the Declaration, the Preferred Securities Guarantee
and the Indenture to the Holder without charge upon written request to the
Trust at its principal place of business.

Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.

By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debt Securities as indebtedness and the Preferred
Securities as evidence of indirect beneficial ownership in the Debt
Securities.

Unless the Property Trustee's Certificate of Authentication hereon has
been properly executed, these Preferred Securities shall not be entitled to
any benefit under the Declaration or be valid or obligatory for any purpose.

- -------------------

(6) Insert I, II, III or IV as applicable.

A1-2
<PAGE>

IN WITNESS WHEREOF, the Trust has executed this certificate this ____ day
of __________, _____.

UnionBanCal Finance Trust /(7)/

By:
-------------------------------------
Name:
Title: Trustee
Solely as trustee and not in his
individual capacity

- -------------------

(7) Insert I, II, III or IV as applicable.

A1-3
<PAGE>

{FORM OF CERTIFICATE OF AUTHENTICATION}

PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION

This is one of the Preferred Securities referred to in the within-
mentioned Declaration.

Dated: _____________ ____, _____

_______________________,
as Property Trustee

or as Authentication Agent

By:
-------------------------------- By:
Authorized Signatory --------------------------------
Authorized Signatory

A1-4

<PAGE>

{FORM OF REVERSE OF SECURITY}

Distributions payable on each Preferred Security will be fixed at a rate
per annum of ____% (the "Coupon Rate") of the stated liquidation amount of $___
per Preferred Security, such rate being the rate of interest payable on the Debt
Securities to be held by the Property Trustee. Distributions in arrears for
more than one quarter will bear interest thereon compounded quarterly at the
Coupon Rate (to the extent permitted by applicable law). The term
"Distributions" as used herein includes such cash distributions and any such
interest payable unless otherwise stated. A Distribution is payable only to the
extent that payments are made in respect of the Debt Securities held by the
Property Trustee and to the extent the Property Trustee has funds available
therefor. The amount of Distributions payable for any period will be computed
for any full quarterly Distribution period on the basis of a 360-day year of
twelve 30-day months, and for any period shorter than a full quarterly
Distribution period for which Distributions are computed, Distributions will be
computed on the basis of the actual number of days elapsed per 30-day month.

Except as otherwise described below, Distributions on the Preferred
Securities will be cumulative, will accumulate from __________ ___, _____ and
will be payable quarterly in arrears, on ________ ____, _________ ____,
_________ ___ and ________ ___ of each year, commencing on ________ ___,
_______, which payment dates shall correspond to the interest payment dates on
the Debt Securities, to Holders of record at the close of business on the
regular record date for such Distribution which shall be the close of business
15 days prior to such Distribution payment date unless otherwise provided in the
Declaration. The Debt Security Issuer has the right under the Indenture to
defer payments of interest by extending the interest payment period from time to
time on the Debt Securities for a period not exceeding 20 consecutive quarters
(each an "Extension Period"); PROVIDED THAT no Extension Period shall last
beyond the date of the maturity or any redemption date of the Debt Securities
and, as a consequence of such deferral, Distributions will also be deferred.
Despite such deferral, quarterly Distributions will continue to accumulate with
interest thereon (to the extent permitted by applicable law) at the Coupon Rate
compounded quarterly during any such Extension Period. Prior to the termination
of any such Extension Period, the Debt Security Issuer may further extend such
Extension Period; PROVIDED THAT such Extension Period together with all such
previous and further extensions thereof may not exceed 20 consecutive quarters
or extend beyond the maturity or any redemption date of the Debt Securities.
Upon the termination of any Extension Period and the payment of all amounts then
due, the Debt Security Issuer may commence a new Extension Period, subject to
the above requirements.

The Preferred Securities shall be redeemable as provided in the
Declaration.

[The Preferred Securities shall be convertible into shares of Common
Stock, through (i) the exchange of Preferred Securities for a portion of the
Debt Securities and (ii) the immediate conversion of such Debt Securities into
Debt Security Issuer Common Stock, in the manner and according to the terms set
forth in the Declaration.]

A1-5

<PAGE>

[CONVERSION REQUEST]

[To: _______________________________,
as Property Trustee of UnionBanCal Finance Trust I

The undersigned owner of these Preferred Securities hereby irrevocably
exercises the option to convert these Preferred Securities, or the portion below
designated, into Common Stock of UnionBanCal Corporation (the "Common Stock") in
accordance with the terms of the Amended and Restated Declaration of Trust (the
"Declaration"), dated as of ___________ ___, _____, by __________________,
___________________ and ___________________, as Regular Trustees,
___________________, as Delaware Trustee, _________________________, as Property
Trustee, UnionBanCal Corporation, as Sponsor, and by the Holders, from time to
time, of individual beneficial interests in the Trust to be issued pursuant to
the Declaration. Pursuant to the aforementioned exercise of the option to
convert these Preferred Securities, the undersigned hereby directs the
Conversion Agent (as that term is defined in the Declaration) to (i) exchange
such Preferred Securities for a portion of the Debt Securities (as that term is
defined in the Declaration) held by the Trust (at the rate of exchange specified
in the terms of the Preferred Securities set forth as Annex I to the
Declaration) and (ii) immediately convert such Debt Securities on behalf of the
undersigned, into Common Stock (at the conversion rate specified in the terms of
the Preferred Securities set forth as Annex I to the Declaration).

The undersigned does also hereby direct the Conversion Agent that the
shares issuable and deliverable upon conversion, together with any check in
payment for fractional shares, be issued in the name of and delivered to the
undersigned, unless a different name has been indicated in the assignment
below. If shares are to be issued in the name of a person other than the
undersigned, the undersigned will pay all transfer taxes payable with respect
thereto.]

A1-6

<PAGE>

[Date: _______________, ____

in whole _____ in part _____

Number of Preferred Securities to be converted:
____________________

If a name or names other than the undersigned, please indicate in
the spaces below the name or names in which the shares of Common
Stock are to be issued, along with the address or addresses of
such person or persons

_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________

_________________________________________________________________
Signature

Please Print or Typewrite Name and Address, Including Zip Code,
and Social Security or Other Identifying Number

_________________________________________________________________
_________________________________________________________________
_________________________________________________________________

Signature Guarantee:* ___________________________________________

_________________

* (Signature must be guaranteed by an "eligible guarantor institution,"
that is, a bank, stockbroker, savings and loan association or credit union
meeting the requirements of the Conversion Agent, which requirements include
membership or participation in the Securities Transfer Agents Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Conversion Agent in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.)]

A1-7

<PAGE>

{FORM OF ASSIGNMENT FOR DEFINITIVE PREFERRED SECURITY}

For value received ___________________________________________ hereby sell(s),
assign(s) and transfer(s) unto _______________________________________________
(Please insert social security or other taxpayer identification number of
assignee.)

the within security and hereby irrevocably constitutes and appoints ___________
attorney to transfer the said security on the books of the Company, with full
power of substitution in the premises.

Dated:
-----------------------------

Signature(s) --------------------------------------

--------------------------------------

--------------------------------------
Signature Guarantee*

NOTICE: The above signatures of the holder(s) hereof must correspond with the
name as written upon the face of this Security in every particular without
alteration or enlargement or any change whatever.

________________________

A1-8

<PAGE>

SCHEDULE I

CHANGES TO NUMBER OF PREFERRED SECURITIES IN GLOBAL SECURITY

Number of Preferred
Securities by which this
Global Security Is To Be Remaining Preferred
Reduced or Increased, Securities Represented
and Reason for by this
Date Reduction or Increase Global Security Notation Made By
- ------------ --------------------------- ------------------------- --------------------
<S> <C> <C> <C>

</TABLE>

A1-9

<PAGE>

EXHIBIT A-2

{FORM OF [CONVERTIBLE] COMMON SECURITY CERTIFICATE}

THE SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD UNLESS SUCH OFFER AND SALE ARE REGISTERED UNDER OR ARE EXEMPT
FROM REGISTRATION UNDER THE SECURITIES ACT. THE TRANSFER OF THE SECURITY
EVIDENCED HEREBY IS ALSO SUBJECT TO THE RESTRICTIONS SET FORTH IN THE
DECLARATION REFERRED TO BELOW.

CERTIFICATE NUMBER:

NUMBER OF [CONVERTIBLE] COMMON SECURITIES:

Certificate Evidencing [Convertible] Common Securities

UNIONBANCAL FINANCE TRUST I

____% [Convertible] Common Securities
(liquidation amount $____ per [Convertible] Common Security)

UnionBanCal Finance Trust I, a statutory business trust formed under the
laws of the State of Delaware (the "Trust"), hereby certifies that
________________________________________ (the "Holder") is the registered owner
of [convertible] common securities of the Trust representing undivided
beneficial interests in the assets of the Trust designated the ___%
[Convertible] Common Securities (liquidation amount $____ per [Convertible]
Common Security) (the "Common Securities"). The Common Securities are
transferable on the books and records of the Trust, in person or by a duly
authorized attorney, upon surrender of this certificate duly endorsed and in
proper form for transfer.

The designation, rights, privileges, restrictions, preferences and other
terms and provisions of the Common Securities represented hereby are issued and
shall in all respects be subject to the provisions of the Amended and Restated
Declaration of Trust of the Trust dated as of __________ ___, _____, as the same
may be amended from time to time (the "Declaration"), including the designation
of the terms of the Common Securities as set forth in Annex I to the
Declaration.

A2-1

<PAGE>

Capitalized terms used herein but not defined shall have the meaning
given them in the Declaration. The Holder is entitled to the benefits of the
Common Securities Guarantee to the extent provided therein. The Sponsor will
provide a copy of the Declaration, the Common Securities Guarantee and the
Indenture to a Holder without charge upon written request to the Trust at its
principal place of business.

Upon receipt of this certificate, the Holder is bound by the Declaration
and is entitled to the benefits thereunder.

By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debt Securities as indebtedness and the Common
Securities as evidence of indirect beneficial ownership in the Debt Securities.

A2-2

<PAGE>

IN WITNESS WHEREOF, the Trust has executed this certificate this ____ day
of ________, _____.

UnionBanCal Finance Trust I

By:
-----------------------------------
Name:
Title: Trustee
Solely as trustee and not in his
individual capacity

A2-3

<PAGE>

{FORM OF REVERSE OF SECURITY}

Distributions payable on each Common Security will be fixed at a rate
per annum, of ___% (the "Coupon Rate") of the stated liquidation amount of
$____ per Common Security, such rate being the rate of interest payable on
the Debt Securities to be held by the Property Trustee. Distributions in
arrears for more than one quarter will bear interest thereon compounded
quarterly at the Coupon Rate (to the extent permitted by applicable law).
The term "Distributions" as used herein includes such cash distributions and
any such interest payable unless otherwise stated. A Distribution is payable
only to the extent that payments are made in respect of the Debt Securities
held by the Property Trustee and to the extent the Property Trustee has funds
available therefor. The amount of Distributions payable for any period will
be computed for any full quarterly Distribution period on the basis of a
360-day year of twelve 30-day months, and for any period shorter than a full
quarterly Distribution period for which Distributions are computed,
Distributions will be computed on the basis of the actual number of days
elapsed per 30-day month.

Except as otherwise described below, Distributions on the Common
Securities will be cumulative, will accumulate from __________ ___, ____ and
will be payable quarterly in arrears, on _______ ___, ________ ___, _______
___ and ________ ___ of each year, commencing on _________ ___, ____, which
payment dates shall correspond to the interest payment dates on the Debt
Securities, to Holders of record at the close of business on the regular
record date for such Distribution which shall be the close of business 15 days
prior to such Distribution payment date unless otherwise provided in the
Declaration. The Debt Security Issuer has the right under the Indenture to
defer payments of interest by extending the interest payment period from time
to time on the Debt Securities for a period not exceeding 20 consecutive
quarters (each an "Extension Period"), PROVIDED THAT no Extension Period
shall last beyond the date of maturity of the Debt Securities and, as a
consequence of such deferral, Distributions will also be deferred. Despite
such deferral, quarterly Distributions will continue to accumulate with
interest thereon (to the extent permitted by applicable law) at the Coupon
Rate compounded quarterly during any such Extension Period. Prior to the
termination of any such Extension Period, the Debt Security Issuer may
further extend such Extension Period; PROVIDED THAT such Extension Period
together with all such previous and further extensions thereof may not exceed
20 consecutive quarters or extend beyond the date of maturity of the Debt
Securities. Upon the termination of any Extension Period and the payment of
all amounts then due, the Debt Security Issuer may commence a new Extension
Period, subject to the above requirements.

The Common Securities shall be redeemable as provided in the Declaration.

[The Common Securities shall be convertible into shares of Common Stock,
through (i) the exchange of Common Securities for a portion of the Debt
Securities and (ii) the immediate conversion of such Debt Securities into Debt
Security Issuer Common Stock, in the manner and according to the term set forth
in the Declaration.]

A2-4

<PAGE>

[CONVERSION REQUEST]

[To: ______________________________,
as Property Trustee of UnionBanCal Finance Trust I

The undersigned owner of these Common Securities hereby irrevocably
exercises the option to convert these Common Securities, or the portion below
designated, into Common Stock of UnionBanCal Corporation (the "Common Stock") in
accordance with the terms of the Amended and Restated Declaration of Trust (the
"Declaration"), dated as of _________ ___, ____, by _________________,
___________________ and ______________________, as Regular Trustees,
____________________, as Delaware Trustee, ________________________, as Property
Trustee, UnionBanCal Corporation, as Sponsor, and by the Holders, from time to
time, of individual beneficial interests in the Trust to be issued pursuant to
the Declaration. Pursuant to the aforementioned exercise of the option to
convert these Common Securities, the undersigned hereby directs the Conversion
Agent (as that term is defined in the Declaration) to (i) exchange such Common
Securities for a portion of the Debt Securities (as that term is defined in the
Declaration) held by the Trust (at the rate of exchange specified in the terms
of the Common Securities set forth as Annex I to the Declaration) and
(ii) immediately convert such Debt Securities on behalf of the undersigned, into
Common Stock (at the conversion rate specified in the terms of the Common
Securities set forth as Annex I to the Declaration).

A2-5

<PAGE>

[Date: _______________, ____

in whole _____ in part _____

Number of Common Securities to be converted: ____________________

_________________________________________________________________
Signature

Please Print or Typewrite Name and Address, Including Zip Code,
and Social Security or Other Identifying Number

_________________________________________________________________
_________________________________________________________________
_________________________________________________________________

Signature Guarantee:* ___________________________________________

___________________________

A2-6

<PAGE>

FORM OF ASSIGNMENT FOR SECURITY [OR
COMMON STOCK ISSUABLE UPON CONVERSION] THEREOF

For value received ________________________________________ hereby sell(s),
assign(s) and transfer(s) unto _______________________________________________
(Please insert social security or other taxpayer identification number of
assignee.)

the within security and hereby irrevocably constitutes and appoints ___________
attorney to transfer the said security on the books of ____________, with full
power of substitution in the premises.

Dated:
-------------------------------

Signature(s)
------------------------------------

------------------------------------

------------------------------------
Signature Guarantee*

______________________

A2-7

<PAGE>

EXHIBIT B

SPECIMEN OF DEBT SECURITY

B-1

<PAGE>

EXHIBIT C

UNDERWRITING AGREEMENT

C-1

<PAGE>
Exhibit 4.14

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

UNIONBANCAL CORPORATION

and

THE FIRST NATIONAL BANK OF CHICAGO, as Trustee

Indenture

Dated as of ________ __, ____

Debt Securities

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>

CROSS REFERENCE SHEET*

Between

Provisions of Trust Indenture Act (as defined herein) and Indenture
dated as of ________ __, ____ between UNIONBANCAL CORPORATION and The First
National Bank of Chicago, a national banking association, as Trustee:

SECTION OF THE ACT SECTION OF INDENTURE
<S> <C>
310(a)(1) and (2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6.9
310(a)(3) and (4). . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
310(b) . . . . . . . . . . . . . . . . . . . . . . . . . 6.8 and 6.10(a), (b) and (d)
310(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
311(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.14
311(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.14
311(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
312(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4.1 and 4.2
312(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4.2
312(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4.2
313(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4.3
313(b)(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
313(b)(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4.3
313(c) . . . . . . . . . . . . . . . . . . . . . . . . . . 4.3, 5.11, 6.10, 6.11, 8.2
and 12.2
313(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4.3
314(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3.5 and 4.2
314(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
314(c)(1) and (2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.5
314(c)(3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
314(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
314(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.5
314(f) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inapplicable
315(a), (c) and (d). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6.1
315(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.11
315(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.12
316(a)(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.9 and 5.10
316(a)(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Not required
316(a) (last sentence) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7.4
316(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5.7
317(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5.2
317(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.4(a) and (b)
318(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.7

</TABLE>

<PAGE>

*This Cross Reference Sheet is not part of the Indenture.

3
<PAGE>

TABLE OF CONTENTS
<TABLE>
<CAPTION>

PAGE
----
<S> <C>
ARTICLE I

DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
SECTION 1.1 CERTAIN TERMS DEFINED. . . . . . . . . . . . . . . . . .1

ARTICLE II

SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
SECTION 2.1 FORMS GENERALLY. . . . . . . . . . . . . . . . . . . . .7
SECTION 2.2 FORM OF TRUSTEE'S CERTIFICATE OF
AUTHENTICATION.. . . . . . . . . . . . . . . . . . . .7
SECTION 2.3 AMOUNT UNLIMITED; ISSUABLE IN SERIES.. . . . . . . . . .8
SECTION 2.4 AUTHENTICATION AND DELIVERY OF
SECURITIES.. . . . . . . . . . . . . . . . . . . . . 11
SECTION 2.5 EXECUTION OF SECURITIES. . . . . . . . . . . . . . . . 14
SECTION 2.6 CERTIFICATE OF AUTHENTICATION. . . . . . . . . . . . . 14
SECTION 2.7 DENOMINATION AND DATE OF SECURITIES;
PAYMENT OF INTEREST.. . . . . . . . . . . . . . . . 14
SECTION 2.8 REGISTRATION, TRANSFER AND
EXCHANGE.. . . . . . . . . . . . . . . . . . . . . . 15
SECTION 2.9 MUTILATED, DEFACED, DESTROYED, LOST
AND STOLEN SECURITIES.. . . . . . . . . . . . . . . 18
SECTION 2.10 CANCELLATION OF SECURITIES;
DESTRUCTION THEREOF. . . . . . . . . . . . . . . . . 20
SECTION 2.11 TEMPORARY SECURITIES. . . . . . . . . . . . . . . . . 20

ARTICLE III

COVENANTS OF THE ISSUER . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 3.1 PAYMENT OF PRINCIPAL AND INTEREST. . . . . . . . . . . 21
SECTION 3.2 OFFICES FOR PAYMENTS, ETC. . . . . . . . . . . . . . . 21
SECTION 3.3 APPOINTMENT TO FILL A VACANCY IN
OFFICE OF TRUSTEE. . . . . . . . . . . . . . . . . . 22
SECTION 3.4 PAYING AGENTS. . . . . . . . . . . . . . . . . . . . . 22
SECTION 3.5 COMPLIANCE CERTIFICATES. . . . . . . . . . . . . . . . 23
SECTION 3.6 CORPORATE EXISTENCE. . . . . . . . . . . . . . . . . . 23
SECTION 3.7 MAINTENANCE OF PROPERTIES. . . . . . . . . . . . . . . 24
SECTION 3.8 PAYMENT OF TAXES AND OTHER CLAIMS. . . . . . . . . . . 24
SECTION 3.9 LUXEMBOURG PUBLICATIONS. . . . . . . . . . . . . . . . 24

i
<PAGE>

PAGE
----
<S> <C>
ARTICLE IV

SECURITYHOLDER LISTS AND REPORTS BY THE
ISSUER AND THE TRUSTEE. . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 4.1 ISSUER TO FURNISH TRUSTEE INFORMATION
AS TO NAMES AND ADDRESSES OF SECURITYHOLDERS.. . . . 25
SECTION 4.2 REPORTS BY THE ISSUER. . . . . . . . . . . . . . . . . 25
SECTION 4.3 REPORTS BY THE TRUSTEE.. . . . . . . . . . . . . . . . 25

ARTICLE V

REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 5.1 EVENT OF DEFAULT DEFINED,
ACCELERATION OF MATURITY;
WAIVER OF DEFAULT. . . . . . . . . . . . . . . . . . 27
SECTION 5.2 COLLECTION OF INDEBTEDNESS BY
TRUSTEE; TRUSTEE MAY PROVE DEBT. . . . . . . . . . . 30
SECTION 5.3 APPLICATION OF PROCEEDS. . . . . . . . . . . . . . . . 33
SECTION 5.4 SUITS FOR ENFORCEMENT. . . . . . . . . . . . . . . . . 34
SECTION 5.5 RESTORATION OF RIGHTS ON
ABANDONMENT OF PROCEEDINGS.. . . . . . . . . . . . . 34
SECTION 5.6 LIMITATIONS ON SUITS BY SECURITY
HOLDERS. . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 5.7 UNCONDITIONAL RIGHT OF
SECURITYHOLDERS TO INSTITUTE
CERTAIN SUITS. . . . . . . . . . . . . . . . . . . . 35
SECTION 5.8 POWERS AND REMEDIES CUMULATIVE;
DELAY OR OMISSION NOT WAIVER
OF DEFAULT.. . . . . . . . . . . . . . . . . . . . . 35
SECTION 5.9 CONTROL BY HOLDERS OF SECURITIES.. . . . . . . . . . . 35
SECTION 5.10 WAIVER OF PAST DEFAULTS.. . . . . . . . . . . . . . . 36
SECTION 5.11 TRUSTEE TO GIVE NOTICE OF DEFAULT,
BUT MAY WITHHOLD IN CERTAIN
CIRCUMSTANCES. . . . . . . . . . . . . . . . . . . . 36
SECTION 5.12 RIGHT OF COURT TO REQUIRE FILING OF
UNDERTAKING TO PAY COSTS.. . . . . . . . . . . . . . 36

<PAGE>

PAGE
----
<S> <C> <C>
ARTICLE VI

CONCERNING THE TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 6.1 DUTIES AND RESPONSIBILITIES OF THE
TRUSTEE; DURING DEFAULT;
PRIOR TO DEFAULT.. . . . . . . . . . . . . . . . . . 37
SECTION 6.2 CERTAIN RIGHTS OF THE TRUSTEE. . . . . . . . . . . . . 38
SECTION 6.3 TRUSTEE NOT RESPONSIBLE FOR RECITALS,
DISPOSITION OF SECURITIES OR
APPLICATION OF PROCEEDS THEREOF. . . . . . . . . . . 39
SECTION 6.4 TRUSTEE AND AGENTS MAY HOLD
SECURITIES OR COUPONS;
COLLECTIONS, ETC.. . . . . . . . . . . . . . . . . . 40
SECTION 6.5 MONEYS HELD BY TRUSTEE.. . . . . . . . . . . . . . . . 40
SECTION 6.6 COMPENSATION AND INDEMNIFICATION OF
TRUSTEE AND ITS PRIOR CLAIM. . . . . . . . . . . . . 40
SECTION 6.7 RIGHT OF TRUSTEE TO RELY ON OFFICER'S
CERTIFICATE, ETC.. . . . . . . . . . . . . . . . . . 40
SECTION 6.8 INDENTURES NOT CREATING POTENTIAL
CONFLICTING INTERESTS FOR THE
TRUSTEE.. . . . . . . . . . . . . . . . . . . . . . 41
SECTION 6.9 QUALIFICATION OF TRUSTEE: CONFLICTING
INTERESTS. . . . . . . . . . . . . . . . . . . . . . 41
SECTION 6.10 PERSONS ELIGIBLE FOR APPOINTMENT AS
TRUSTEE. . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 6.11 RESIGNATION AND REMOVAL;
APPOINTMENT OF SUCCESSOR
TRUSTEE. . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 6.12 ACCEPTANCE OF APPOINTMENT BY
SUCCESSOR TRUSTEE. . . . . . . . . . . . . . . . . . 43
SECTION 6.13 MERGER, CONVERSION, CONSOLIDATION
OR SUCCESSION TO BUSINESS OF
TRUSTEE. . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 6.14 PREFERENTIAL COLLECTION OF CLAIMS
AGAINST THE ISSUER.. . . . . . . . . . . . . . . . . 44
SECTION 6.15 APPOINTMENT OF AUTHENTICATING
AGENT. . . . . . . . . . . . . . . . . . . . . . . . 45

iii
<PAGE>

PAGE
----
<S> <C> <C>
ARTICLE VII

CONCERNING THE SECURITYHOLDERS . . . . . . . . . . . . . . . . . . . . . . . 46
SECTION 7.1 EVIDENCE OF ACTION TAKEN BY
SECURITYHOLDERS. . . . . . . . . . . . . . . . . . . 46
SECTION 7.2 PROOF OF EXECUTION OF INSTRUMENTS
AND OF HOLDING OF SECURITIES.. . . . . . . . . . . . 46
SECTION 7.3 HOLDERS TO BE TREATED AS OWNERS. . . . . . . . . . . . 46
SECTION 7.4 SECURITIES OWNED BY ISSUER DEEMED
NOT OUTSTANDING. . . . . . . . . . . . . . . . . . . 47
SECTION 7.5 RIGHT OF REVOCATION OF ACTION
TAKEN. . . . . . . . . . . . . . . . . . . . . . . . 47

ARTICLE VIII

SUPPLEMENTAL INDENTURES . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 8.1 SUPPLEMENTAL INDENTURES WITHOUT
CONSENT OF SECURITYHOLDERS.. . . . . . . . . . . . . 48
SECTION 8.2 SUPPLEMENTAL INDENTURES WITH
CONSENT OF SECURITYHOLDERS.. . . . . . . . . . . . . 49
SECTION 8.3 EFFECT OF SUPPLEMENTAL INDENTURE.. . . . . . . . . . . 51
SECTION 8.4 DOCUMENTS TO BE GIVEN TO TRUSTEE.. . . . . . . . . . . 51
SECTION 8.5 NOTATION ON SECURITIES IN RESPECT OF
SUPPLEMENTAL INDENTURES. . . . . . . . . . . . . . . 51

ARTICLE IX

CONSOLIDATION, MERGER, SALE OR CONVEYANCE . . . . . . . . . . . . . . . . . . 51
SECTION 9.1 ISSUER MAY CONSOLIDATE, ETC., ONLY
ON CERTAIN TERMS.. . . . . . . . . . . . . . . . . . 51
SECTION 9.2 SUCCESSOR CORPORATION SUBSTITUTED. . . . . . . . . . . 52
SECTION 9.3 OPINION OF COUNSEL TO BE GIVEN
TRUSTEE. . . . . . . . . . . . . . . . . . . . . . . 52

ARTICLE X

SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
SECTION 10.1 SATISFACTION AND DISCHARGE OF
INDENTURE. . . . . . . . . . . . . . . . . . . . . . 52

<PAGE>

PAGE
----
<S> <C> <C>

SECTION 10.2 APPLICATION BY TRUSTEE OF FUNDS
DEPOSITED FOR PAYMENT OF
SECURITIES.. . . . . . . . . . . . . . . . . . . . . 56
SECTION 10.3 REPAYMENT OF MONEYS HELD BY
PAYING AGENT.. . . . . . . . . . . . . . . . . . . . 56
SECTION 10.4 RETURN OF MONEYS HELD BY TRUSTEE
AND PAYING AGENT UNCLAIMED
FOR TWO YEARS. . . . . . . . . . . . . . . . . . . . 56
SECTION 10.5 INDEMNITY FOR U.S. GOVERNMENT OF
OBLIGATIONS. . . . . . . . . . . . . . . . . . . . . 57

ARTICLE XI

MISCELLANEOUS PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 11.1 INCORPORATORS, SHAREHOLDERS,
OFFICERS AND DIRECTORS OF
ISSUER EXEMPT FROM INDIVIDUAL
LIABILITY. . . . . . . . . . . . . . . . . . . . . . 57
SECTION 11.2 PROVISIONS OF INDENTURE FOR THE SOLE
BENEFIT OF PARTIES AND HOLDERS OF
SECURITIES AND COUPONS.. . . . . . . . . . . . . . . 57
SECTION 11.3 SUCCESSORS AND ASSIGNS OF ISSUER
BOUND BY INDENTURE.. . . . . . . . . . . . . . . . . 58
SECTION 11.4 NOTICES AND DEMANDS ON ISSUER,
TRUSTEE AND HOLDERS OF SECURITIES
AND COUPONS. . . . . . . . . . . . . . . . . . . . . 58
SECTION 11.5 OFFICER'S CERTIFICATES AND OPINIONS OF
COUNSEL; STATEMENTS TO BE
CONTAINED THEREIN. . . . . . . . . . . . . . . . . . 59
SECTION 11.6 PAYMENTS DUE ON SATURDAYS, SUNDAYS
AND HOLIDAYS.. . . . . . . . . . . . . . . . . . . . 60
SECTION 11.7 CONFLICT OF ANY PROVISION OF
INDENTURE WITH TRUST INDENTURE
ACT. . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 11.8 NEW YORK LAW TO GOVERN. . . . . . . . . . . . . . . . 60
SECTION 11.9 COUNTERPARTS. . . . . . . . . . . . . . . . . . . . . 60
SECTION 11.10 EFFECT OF HEADINGS.. . . . . . . . . . . . . . . . . 60
SECTION 11.11 SECURITIES IN A COMPOSITE CURRENCY,
CURRENCY UNIT, FOREIGN CURRENCY
OR IN ECU. . . . . . . . . . . . . . . . . . . . . 60

<PAGE>

PAGE
----
<S> <C> <C>

SECTION 11.12 JUDGMENT CURRENCY. . . . . . . . . . . . . . . . . . 61

ARTICLE XII

REDEMPTION OF SECURITIES AND SINKING FUNDS . . . . . . . . . . . . . . . . . 62
SECTION 12.1 APPLICABILITY OF ARTICLE. . . . . . . . . . . . . . . 62
SECTION 12.2 NOTICE OF REDEMPTION; PARTIAL
REDEMPTIONS. . . . . . . . . . . . . . . . . . . . . 62
SECTION 12.3 PAYMENT OF SECURITIES CALLED FOR
REDEMPTION.. . . . . . . . . . . . . . . . . . . . . 63
SECTION 12.4 EXCLUSION OF CERTAIN SECURITIES FROM
ELIGIBILITY FOR SELECTION FOR
REDEMPTION.. . . . . . . . . . . . . . . . . . . . . 64
SECTION 12.5 MANDATORY AND OPTIONAL SINKING
FUNDS. . . . . . . . . . . . . . . . . . . . . . . . 65

</TABLE>

<PAGE>

THIS INDENTURE, dated as of ________ __, ___, by and between
UNIONBANCAL CORPORATION, a California corporation (the "Issuer"), and The First
National Bank of Chicago, a national banking association, as trustee (the
"Trustee"),

W I T N E S S E T H:

WHEREAS, the Issuer has duly authorized the issue from time to time of
its unsecured debentures, notes or other evidences of indebtedness to be issued
in one or more series (the "Securities") up to such principal amount or amounts
as may from time to time be authorized in accordance with the terms of this
Indenture;

WHEREAS, the Issuer has duly authorized the execution and delivery of
this Indenture to provide, among other things, for the authentication, delivery
and administration of the Securities; and

WHEREAS, all things necessary to make this Indenture a valid indenture
and agreement according to its terms have been done;

NOW, THEREFORE:

In consideration of the premises and the purchases of the Securities
by the holders thereof, the Issuer and the Trustee mutually covenant and agree
for the equal and proportionate benefit of the respective holders from time to
time of the Securities and of the coupons, if any, appertaining thereto as
follows:

ARTICLE I

DEFINITIONS

SECTION 1.1 CERTAIN TERMS DEFINED. The following terms (except as
otherwise expressly provided or unless the context otherwise clearly requires)
for all purposes of this Indenture and of any indenture supplemental hereto
shall have the respective meanings specified in this Section. All other terms
used in this Indenture that are defined in the Trust Indenture Act of 1939, as
amended (the "Trust Indenture Act"), or the definitions of which in the
Securities Act of 1933, as amended (the "Securities Act"), are referred to in
the Trust Indenture Act, including terms defined therein by reference to the
Securities Act (except as herein otherwise expressly provided or unless the
context otherwise requires), shall have the meaning assigned to such terms in
the Trust Indenture Act and in the Securities Act as in effect from time to
time. All accounting terms used herein and not expressly defined shall have the
meanings assigned to such terms in accordance with generally accepted accounting
principles, and the term "generally accepted accounting principles" means such
accounting principles as are generally accepted at the time of any computation
unless a different time shall be specified with respect to such series of
Securities as provided for in Section 2.3. The words "herein," "hereof" and
"hereunder" and other words of similar import refer to this Indenture as a whole
and not to any particular Article,

1
<PAGE>

Section or other subdivision. The terms defined in this Article have the
meanings assigned to them in this Article and include the plural as well as the
singular.

"Affiliate" has the same meaning as given to that term in Rule 405 of
the Securities Act or any successor provision.

"Authenticating Agent" shall have the meaning set forth in Section
6.15.

"Authorized Newspaper" means a newspaper (which, in the case of The
City of New York, will, if practicable, be THE WALL STREET JOURNAL (Eastern
Edition), in the case of the United Kingdom of Great Britain and Northern
Ireland (the "United Kingdom"), will, if practicable, be THE FINANCIAL TIMES
(London Edition) and, in the case of the Grand Duchy of Luxembourg
("Luxembourg"), will, if practicable, be the LUXEMBURGER WORT) published in an
official or common language of the country of publication customarily published
at least once a day for at least five days in each calendar week and of general
circulation in The City of New York, the United Kingdom or Luxembourg, as
applicable. If it shall be impractical in the opinion of the Trustee to make
any publication of any notice required hereby in an Authorized Newspaper, any
publication or other notice in lieu thereof which is made or given with the
approval of the Trustee shall constitute a sufficient publication of such
notice.

"Board of Directors" means either the Board of Directors of the Issuer
or any committee of such Board duly authorized to act on its behalf.

"Board Resolution" means a copy of one or more resolutions, certified
by the secretary or an assistant secretary of the Issuer to have been duly
adopted or consented to by the Board of Directors and to be in full force and
effect, and delivered to the Trustee.

"Business Day" means, with respect to any Security, a day that is not
a day on which banking institutions in the city (or in any of the cities, if
more than one) in which amounts are payable, as specified in the form of such
Security, are authorized or required by any applicable law or regulation to be
closed.

"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act, or if at any time
after the execution and delivery of this Indenture such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties on such date.

"Corporate Trust Office" means the office of the Trustee at which the
corporate trust business of the Trustee shall, at any particular time, be
principally administered, which office is, as of the date of this Indenture,
located at One North State, 9th Floor, Chicago, IL 60602.

"Coupon" means any interest coupon appertaining to an Unregistered
Security.

"Covenant Defeasance" shall have the meaning set forth in Section
10.1(C).

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"Depositary" means, with respect to the Securities of any series
issuable or issued in the form of one or more Registered Global Securities, the
Person designated as Depositary by the Issuer pursuant to Section 2.3 until a
successor Depositary shall have become such pursuant to the applicable
provisions of this Indenture, and thereafter "Depositary" shall mean or include
each Person who is then a Depositary hereunder, and if at any time there is more
than one such Person, "Depositary" as used with respect to the Securities of any
such series shall mean the Depositary with respect to the Registered Global
Securities of that series.

"Dollar" or "$" means the coin or currency of the United States of
America as at the time of payment is legal tender for the payment of public and
private debts.

"ECU" means the European Currency Unit as defined and revised from
time to time by the European Monetary System of the European Community.

"Event of Default" means any event or condition specified as such in
Section 5.1.

"Exchange Act" means the Securities Exchange Act of 1934, as amended.

"Fair Value" when used with respect to any Voting Stock means the fair
value as determined in good faith by the Board of Directors of the Issuer.

"Foreign Currency" means a currency issued by the government of a
country other than the United States of America.

"Holder," "Holder of Securities," "Securityholder" or any other
similar term means (a) in the case of any Registered Security, the person in
whose name such Security is registered in the security register kept by the
Issuer for that purpose in accordance with the terms hereof, and (b) in the case
of any Unregistered Security, the bearer of such Security, or any Coupon
appertaining thereto, as the case may be.

"Indenture" means this instrument as originally executed and delivered
or, if amended or supplemented as herein provided, as so amended or supplemented
or both, and shall include the forms and terms of particular series of
Securities established as contemplated hereunder.

"IRS" means the Internal Revenue Service of the United States
Department of the Treasury, or any successor entity.

"Issuer" means (except as otherwise provided in Article IX)
UnionBanCal Corporation, a California corporation, and, subject to Article IX,
its successors and assigns.

"Issuer Order" means a written statement, request or order of the
Issuer signed in its name by the chairman of the Board of Directors, the
president, any vice president or the treasurer of the Issuer.

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"Judgment Currency" has the meaning set forth in Section 11.12.

"Non-U.S. Person" means any person that is not a "U.S. person" as such
term is defined in Rule 902 of the Securities Act.

"Officer's Certificate" means a certificate signed by the chairman of
the Board of Directors, the president or any vice president or the treasurer of
the Issuer and delivered to the Trustee. Each such certificate shall comply
with Section 314 of the Trust Indenture Act and include the statements provided
for in Section 11.5.

"Opinion of Counsel" means an opinion in writing signed by legal
counsel who may be an employee of the Issuer or other counsel satisfactory to
the Trustee. Each such opinion shall comply with Section 314 of the Trust
Indenture Act and include the statements provided for in Section 11.5.

"Original Issue Date" of any Security (or portion thereof) means the
earlier of (a) the date of such Security or (b) the date of any Security (or
portion thereof) for which such Security was issued (directly or indirectly) on
registration of transfer, exchange or substitution.

"Original Issue Discount Security" means any Security that provides
for an amount less than the principal amount thereof to be due and payable upon
a declaration of acceleration of the maturity thereof pursuant to Section 5.1.

"Outstanding" (except as otherwise provided in Section 7.4), when used
with reference to Securities, means, subject to the provisions of Section 7.4,
as of any particular time, all Securities authenticated and delivered by the
Trustee under this Indenture, except:

(a) Securities theretofore cancelled by the Trustee or delivered to
the Trustee for cancellation;

(b) Securities, or portions thereof, for the payment or redemption of
which moneys or U.S. Government Obligations (as provided for in Section
10.1) in the necessary amount shall have been deposited in trust with the
Trustee or with any paying agent (other than the Issuer) or shall have been
set aside, segregated and held in trust by the Issuer for the Holders of
such Securities (if the Issuer shall act as its own paying agent),
PROVIDED, that if such Securities, or portions thereof, are to be redeemed
prior to the maturity thereof, notice of such redemption shall have been
given as herein provided, or provisions satisfactory to the Trustee shall
have been made for giving such notice; and

(c) Securities which shall have been paid or in substitution for
which other Securities shall have been authenticated and delivered pursuant
to the terms of Section 2.9 (except with respect to any such Security as to
which proof satisfactory to the Trustee is presented that such Security is
held by a person in whose hands such Security is a legal, valid and binding
obligation of the Issuer).

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In determining whether the Holders of the requisite principal amount
of Outstanding Securities of any or all series have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, the principal
amount of an Original Issue Discount Security that shall be deemed to be
Outstanding for such purposes shall be the amount of the principal thereof that
would be due and payable as of the date of such determination upon a declaration
of acceleration of the maturity thereof pursuant to Section 5.1.

"Periodic Offering" means an offering of Securities of a series from
time to time, the specific terms of which Securities, including, without
limitation, the rate or rates of interest, if any, thereon, the stated maturity
or maturities thereof and the redemption provisions, if any, with respect
thereto, are to be determined by the Issuer or its agents upon the issuance of
such Securities.

"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.

"Principal" whenever used with reference to the Securities or any
Security or any portion thereof, shall be deemed to include "and premium, if
any," PROVIDED, HOWEVER, that such inclusion of premium, if any, shall under no
circumstances result in the double counting of such premium for the purpose of
any calculation required hereunder.

"Record date" shall have the meaning set forth in Section 2.7.

"Registered Global Security" means a Security evidencing all or a part
of a series of Registered Securities, issued to the Depositary for such series
in accordance with Section 2.4, and bearing the legend prescribed in Section 2.4
and any other legend required by the Depositary for such series.

"Registered Security" means any Security registered on the Security
register of the Issuer.

"Required Currency" shall have the meaning set forth in Section 11.12.

"Responsible Officer" when used with respect to the Trustee means any
officer of the Trustee assigned to administer corporate trust matters to whom
any corporate trust matter is referred because of his or her knowledge of and
familiarity with the particular subject.

"Security" or "Securities" (except as otherwise provided in Section
7.4) has the meaning stated in the first recital of this Indenture, or, as the
case may be, Securities that have been authenticated and delivered under this
Indenture.

"Securities Act" means the Securities Act of 1933, as amended.

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<PAGE>

"Senior Securities" means Securities other than Subordinated
Securities.

"Subordinated Securities" means Securities that by the terms
established pursuant to Subsection 2.3(9) are subordinate to any specified debt
of the Issuer.

"Subsidiary" means any corporation of which at least a majority of the
outstanding stock having the voting power to elect a majority of the Board of
Directors of such corporation (irrespective of whether or not at the time stock
of any other class or classes of such corporation shall have or might have
voting power by reason of the happening of any contingency) is at the time of
determination directly or indirectly owned by the Issuer, or by one or more of
its Subsidiaries, or by the Issuer and one or more of its Subsidiaries.

"Trustee" means the Person identified as "Trustee" in the first
paragraph hereof and, subject to the provisions of Article VI, shall also
include any successor trustee. "Trustee" shall also mean or include each Person
who is then a trustee hereunder, and, if at any time there is more than one such
Person, "Trustee" as used with respect to the Securities of any series shall
mean the trustee with respect to the Securities of such series.

"Unregistered Security" means any Security other than a Registered
Security.

"U.S. Government Obligations" shall have the meaning set forth in
Section 10.1(A).

"Voting Stock" means stock of any class or classes having general
voting power under ordinary circumstances to elect a majority of the board of
directors, managers or trustees of the corporation in question, PROVIDED, that,
for the purposes hereof, stock which carries only the right to vote
conditionally on the happening of an event shall not be considered voting stock
whether or not such event shall have happened.

"Yield to Maturity" means the yield to maturity on a series of
securities, calculated at the time of issuance of such series, or, if
applicable, at the most recent redetermination of interest on such series, and
calculated in accordance with accepted financial practice.

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ARTICLE II

SECURITIES

SECTION 2.1 FORMS GENERALLY. The Securities of each series and the
Coupons, if any, to be attached thereto shall be substantially in such form (not
inconsistent with this Indenture) as shall be established by or pursuant to one
or more Board Resolutions (as set forth in a Board Resolution or, to the extent
established pursuant to but not set forth in a Board Resolution, an Officer's
Certificate detailing such establishment) or in one or more indentures
supplemental hereto, in each case with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Indenture and may have imprinted or otherwise reproduced thereon such legend or
legends or endorsements, not inconsistent with the provisions of this Indenture,
as may be required to comply with any law or with any rules or regulations
pursuant thereto, or with any rules of any securities exchange or to conform to
general usage, all as may be determined by the officers executing such
Securities and Coupons, if any, as evidenced by their execution of such
Securities and Coupons.

The definitive Securities and Coupons, if any, shall be printed,
lithographed or engraved on steel engraved borders or may be produced in any
other manner, all as determined by the officers executing such Securities and
Coupons, if any, as evidenced by their execution of such Securities and Coupons,
if any.

SECTION 2.2 FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION. The
Trustee's certificate of authentication on all Securities shall be in
substantially the following form:

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"This is one of the Securities referred to in the within-mentioned
Indenture.

The First National Bank of Chicago, as Trustee

By
-----------------------------------------
Authorized Signatory"

If at any time there shall be an Authenticating Agent appointed with
respect to any series of Securities, then the Trustee's Certificate of
Authentication to be borne by the Securities of each such series shall be
substantially as follows:

"This is one of the Securities referred to in the within-mentioned
Indenture.

[ ]
--------------------------------------------
as Authenticating Agent

By
-----------------------------------------
Authorized Signatory"

SECTION 2.3 AMOUNT UNLIMITED; ISSUABLE IN SERIES. The aggregate
principal amount of Securities which may be authenticated and delivered under
this Indenture is unlimited.

The Securities may be issued in one or more series. There shall be
established in or pursuant to one or more Board Resolutions (and to the extent
established pursuant to but not set forth in a Board Resolution, in an Officer's
Certificate detailing such establishment) or established in one or more
indentures supplemental hereto, prior to the initial issuance of Securities of
any series,

(1) the designation of the Securities of the series, which shall
distinguish the Securities of the series from the Securities of all other
series, and which may be part of a series of Securities previously issued;

(2) any limit upon the aggregate principal amount of the Securities
of the series that may be authenticated and delivered under this Indenture
(except for Securities authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Securities of the
series pursuant to Section 2.8, 2.9, 2.11, 8.5 or 12.3);

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<PAGE>

(3) if other than Dollars, the coin, currency or currencies in which
the Securities of the series are denominated (including, but not limited
to, any composite currency, currency units, Foreign Currency or ECU);

(4) the date or dates on which the principal of the Securities of the
series is payable or the method of determination thereof;

(5) the rate or rates at which the Securities of the series shall
bear interest, if any, the date or dates from which such interest shall
accrue, on which such interest shall be payable, the terms and conditions
of any deferral of interest and the additional interest, if any, thereon,
the right, if any, of the Issuer to extend the interest payment periods and
the duration of the extensions and (in the case of Registered Securities)
the date or dates on which a record shall be taken for the determination of
Holders to whom interest is payable and/or the method by which such rate or
rates or date or dates shall be determined;

(6) the place or places where and the manner in which, the principal
of and any interest on Securities of the series shall be payable, if other
than as provided in Section 3.2;

(7) the right, if any, of the Issuer to redeem Securities, in whole
or in part, at its option and the period or periods within which, or the
date or dates on which, the price or prices at which and any terms and
conditions upon which Securities of the series may be so redeemed, pursuant
to any sinking fund or otherwise;

(8) the obligation, if any, of the Issuer to redeem, purchase or
repay Securities of the series pursuant to any mandatory redemption,
sinking fund or analogous provisions or at the option of a Holder thereof,
and the price or prices at which and the period or periods within which or
the date or dates on which and any terms and conditions upon which
Securities of the series shall be redeemed, purchased or repaid, in whole
or in part, pursuant to such obligation;

(9) the terms, if any, on which the Securities of such series will be
subordinate to other debt of the Issuer;

(10) if other than denominations of $1,000 and any integral multiple
thereof in the case of Registered Securities, or $1,000 and $5,000 in the
case of Unregistered Securities, the denominations in which Securities of
the series shall be issuable;

(11) the percentage of the principal amount at which the Securities
will be issued, and, if other than the principal amount thereof, the
portion of the principal amount of Securities of the series which shall be
payable upon declaration of acceleration of the maturity thereof;

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<PAGE>

(12) if other than the coin, currency or currencies in which the
Securities of the series are denominated, the coin, currency or currencies
in which payment of the principal of or interest on the Securities of such
series shall be payable, including composite currencies or currency units;

(13) if the principal of or interest on the Securities of the series
are to be payable, at the election of the Issuer or a Holder thereof, in a
coin or currency other than that in which the Securities are denominated,
the period or periods within which, and the terms and conditions upon
which, such election may be made;

(14) if the amount of payments of principal of and interest on the
Securities of the series may be determined with reference to an index or
formula based on a coin, currency, composite currency or currency unit
other than that in which the Securities of the series are denominated, the
manner in which such amounts shall be determined;

(15) whether the Securities of the series will be issuable as
Registered Securities (and if so, whether such Securities will be issuable
as Registered Global Securities) or Unregistered Securities (with or
without Coupons), or any combination of the foregoing, any restrictions
applicable to the offer, sale or delivery of Unregistered Securities or the
payment of interest thereon and, if other than as provided in Section 2.8,
the terms upon which Unregistered Securities of any series may be exchanged
for Registered Securities of such series and vice versa;

(16) whether and under what circumstances the Issuer will pay
additional amounts on the Securities of the series held by a person who is
not a U.S. person in respect of any tax, assessment or governmental charge
withheld or deducted and, if so, whether the Issuer will have the option to
redeem the Securities of the series rather than pay such additional
amounts;

(17) if the Securities of the series are to be issuable in definitive
form (whether upon original issue or upon exchange of a temporary Security
of such series) only upon receipt of certain certificates or other
documents or satisfaction of other conditions, the form and terms of such
certificates, documents or conditions;

(18) any trustees, depositaries, authenticating or paying agents,
transfer agents or registrars of any other agents with respect to the
Securities of such series;

(19) any deletion from modification of or addition to the Events of
Default or covenants with respect to the Securities of such series;

(20) if the Securities of the series are to be convertible into or
exchangeable for any other security or property of the Issuer, including,
without limitation, securities of another Person held by the Issuer or its
Affiliates and, if so, the terms thereof; and

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<PAGE>

(21) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture).

All Securities of any one series and Coupons, if any, appertaining
thereto shall be substantially identical, except in the case of Registered
Securities as to denomination and except as may otherwise be provided by or
pursuant to the Board Resolution or Officer's Certificate referred to above or
as set forth in any indenture supplemental hereto. All Securities of any one
series need not be issued at the same time and may be issued from time to time,
consistent with the terms of this Indenture, if so provided by or pursuant to
such Board Resolution, such Officer's Certificate or in any indenture
supplemental hereto.

SECTION 2.4 AUTHENTICATION AND DELIVERY OF SECURITIES. The Issuer
may deliver Securities of any series having attached thereto appropriate
Coupons, if any, executed by the Issuer to the Trustee for authentication
together with the applicable documents referred to below in this Section 2.4,
and the Trustee shall thereupon authenticate and deliver such Securities and
Coupons, if any, to or upon the order of the Issuer (contained in the Issuer
Order referred to below in this Section) or pursuant to such procedures
acceptable to the Trustee and to such recipients as may be specified from time
to time by an Issuer Order. The maturity date, original issue date, interest
rate and any other terms of the Securities of such series and Coupons, if any,
appertaining thereto shall be determined by or pursuant to such Issuer Order and
procedures. If provided for in such procedures, such Issuer Order may authorize
authentication and delivery pursuant to oral or electronic instructions from the
Issuer or its duly authorized agent or agents, which instructions, if oral,
shall be promptly confirmed in writing. In authenticating such Securities and
accepting the additional responsibilities under this Indenture in relation to
such Securities, the Trustee shall be entitled to receive (in the case of
subparagraphs (2), (3) and (4) below only at or before the time of the first
request of the Issuer to the Trustee to authenticate Securities of such series)
and (subject to Section 6.1) shall be fully protected in relying upon, the
following enumerated documents unless and until such documents have been
superseded or revoked:

(1) an Issuer Order requesting such authentication and setting forth
delivery instructions if the Securities and Coupons, if any, are not to be
delivered to the Issuer, PROVIDED that, with respect to Securities of a
series subject to a Periodic Offering, (a) such Issuer Order may be
delivered by the Issuer to the Trustee prior to the delivery to the Trustee
of such Securities for authentication and delivery, (b) the Trustee shall
authenticate and deliver Securities of such series for original issue from
time to time, in an aggregate principal amount not exceeding the aggregate
principal amount established for such series, pursuant to an Issuer Order
or pursuant to procedures acceptable to the Trustee as may be specified
from time to time by an Issuer Order, (c) the maturity date or dates,
original issue date or dates, interest rate or rates and any other terms of
Securities of such series shall be determined by an Issuer Order or
pursuant to such procedures and (d) if provided for in such procedures,
such Issuer Order may authorize authentication and delivery

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<PAGE>

pursuant to oral or electronic instructions from the Issuer or its duly
authorized agent or agents, which instructions, if oral, shall be promptly
confirmed in writing;

(2) any Board Resolution, Officer's Certificate and/or executed
supplemental indenture referred to in Section 2.1 and 2.3 by or pursuant to
which the forms and terms of the Securities and Coupons, if any, were
established;

(3) an Officer's Certificate setting forth the form or forms and
terms of the Securities and Coupons, if any, stating that the form or forms
and terms of the Securities and Coupons, if any, have been established
pursuant to Sections 2.1 and 2.3 and comply with this Indenture, and
covering such other matters as the Trustee may reasonably request; and

(4) At the option of the Issuer, either one or more Opinions of
Counsel, or a letter addressed to the Trustee permitting it to rely on one
or more Opinions of Counsel, substantially to the effect that:

(a) the form or forms of the Securities and Coupons, if any,
have been duly authorized and established in conformity with the
provisions of this Indenture;

(b) in the case of an underwritten offering, the terms of the
Securities have been duly authorized and established in conformity
with the provisions of this Indenture, and, in the case of an offering
that is not underwritten, certain terms of the Securities have been
established pursuant to a Board Resolution, an Officer's Certificate
or a supplemental indenture in accordance with this Indenture, and
when such other terms as are to be established pursuant to procedures
set forth in an Issuer Order shall have been established, all such
terms will have been duly authorized by the Issuer and will have been
established in conformity with the provisions of this Indenture; and

(c) such Securities and Coupons, if any, when executed by the
Issuer and authenticated by the Trustee in accordance with the
provisions of this Indenture and delivered to and duly paid for by the
purchasers thereof, and subject to any conditions specified in such
Opinion of Counsel, will have been duly issued under this Indenture,
will be entitled to the benefits of this Indenture, and will be valid
and binding obligations of the Issuer, enforceable in accordance with
their respective terms except as the enforceability thereof may be
limited by (i) bankruptcy, insolvency, reorganization, liquidation,
moratorium, fraudulent transfer or similar laws affecting creditors'
rights generally, (ii) rights of acceleration, if any, and (iii) the
availability of equitable remedies may be limited by equitable
principles of general applicability and such counsel need express no

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<PAGE>

opinion with regard to the enforceability of Section 6.6 or of a
judgment denominated in a currency other than Dollars.

In rendering such opinions, any counsel may qualify any opinions as to
enforceability by stating that such enforceability may be limited by bankruptcy,
insolvency, reorganization, liquidation, moratorium, fraudulent transfer and
other similar laws affecting the rights and remedies of creditors and is subject
to general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law). Such counsel may rely upon
opinions of other counsel (copies of which shall be delivered to the Trustee)
reasonably satisfactory to the Trustee, in which case the opinion shall state
that such counsel believes he and the Trustee are entitled so to rely. Such
counsel may also state that, insofar as such opinion involves factual matters,
he has relied, to the extent he deems proper, upon certificates of officers of
the Issuer and its subsidiaries and certificates of public officials.

The Trustee shall have the right to decline to authenticate and
deliver any Securities under this section if the Trustee, being advised by
counsel, determines that such action may not lawfully be taken by the Issuer or
if the Trustee in good faith by its board of directors or board of trustees,
executive committee or a trust committee of directors or trustees shall
determine that such action would expose the Trustee to personal liability to
existing Holders or would affect the Trustee's own rights, duties or immunities
under the Securities, this Indenture or otherwise.

If the Issuer shall establish pursuant to Section 2.3 that the
Securities of a series are to be issued in the form of one or more Registered
Global Securities, then the Issuer shall execute and the Trustee shall, in
accordance with this Section and the Issuer Order with respect to such series,
authenticate and deliver one or more Registered Global Securities that (i) shall
represent and shall be denominated in an amount equal to the aggregate principal
amount of all of the Securities of such series issued and not yet cancelled,
(ii) shall be registered in the name of the Depositary for such Registered
Global Security or Securities or the nominee of such Depositary, (iii) shall be
delivered by the Trustee to such Depositary or delivered or held pursuant to
such Depositary's instructions and (iv) shall bear a legend substantially to the
following effect: "Unless and until it is exchanged in whole or in part for
Securities in definitive registered form, this Security may not be transferred
except as a whole by the Depositary to the nominee of the Depositary or by a
nominee of the Depositary to the Depositary or another nominee of the Depositary
or by the Depositary or any such nominee to a successor Depositary or a nominee
of such successor Depositary."

Each Depositary designated pursuant to Section 2.3 must, at the time
of its designation and at all times while it serves as Depositary, be a clearing
agency registered under the Exchange Act and any other applicable statute or
regulation.

SECTION 2.5 EXECUTION OF SECURITIES. The Securities and each Coupon
appertaining thereto, if any, shall be signed on behalf of the Issuer by the
chairman or

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<PAGE>

vice chairman of its Board of Directors or its president, or any executive
(senior or other), a vice president or its treasurer, under its corporate seal
(except in the case of Coupons) which may, but need not, be attested. Such
signatures may be the manual or facsimile signatures of the present or any
future such officers. The seal of the Issuer may be in the form of a facsimile
thereof and may be impressed, affixed, imprinted or otherwise reproduced on the
Securities. Typographical and other minor errors or defects in any such
reproduction of the seal or any such signature shall not affect the validity or
enforceability of any Security that has been duly authenticated and delivered by
the Trustee.

In case any officer of the Issuer who shall have signed any of the
Securities or Coupons, if any, shall cease to be such officer before the
Security or Coupon so signed (or the Security to which the Coupon so signed
appertains) shall be authenticated and delivered by the Trustee or disposed of
by the Issuer, such Security or Coupon nevertheless may be authenticated and
delivered or disposed of as though the person who signed such Security or Coupon
had not ceased to be such officer of the Issuer; and any Security or Coupon may
be signed on behalf of the Issuer by such persons as, at the actual date of the
execution of such Security or Coupon, shall be the proper officers of the
Issuer, although at the date of the execution and delivery of this Indenture any
such person was not such an officer.

SECTION 2.6 CERTIFICATE OF AUTHENTICATION. Only such Securities as
shall bear thereon a certificate of authentication substantially in the form
hereinbefore recited, executed by the Trustee by the manual signature of one of
its authorized officers, shall be entitled to the benefits of this Indenture or
be valid or obligatory for any purpose. No Coupon shall be entitled to the
benefits of this Indenture or shall be valid and obligatory for any purpose
until the certificate of authentication on the Security to which such Coupon
appertains shall have been duly executed by the Trustee. The execution of such
certificate by the Trustee upon any Security executed by the Issuer shall be
conclusive evidence that the Security so authenticated has been duly
authenticated and delivered hereunder and that the Holder is entitled to the
benefits of this Indenture.

SECTION 2.7 DENOMINATION AND DATE OF SECURITIES; PAYMENT OF
INTEREST. The Securities of each series shall be issuable as Registered
Securities or Unregistered Securities in denominations established as
contemplated by Section 2.3 or, with respect to the Registered Securities of any
series, if not so established, in denominations of $1,000 and any integral
multiple thereof. If denominations of Unregistered Securities of any series are
not so established, such Securities shall be issuable in denominations of $1,000
and $5,000. The Securities of each series shall be numbered, lettered or
otherwise distinguished in such manner or in accordance with such plan as the
officers of the Issuer executing the same may determine with the approval of the
Trustee, as evidenced by the execution and authentication thereof.

Each Registered Security shall be dated the date of its
authentication. Each Unregistered Security shall be dated as provided in the
Board Resolution referred to in Section

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2.3. The Securities of each series shall bear interest, if any, from the date,
and such interest shall be payable on the dates, established as contemplated by
Section 2.3.

The person in whose name any Registered Security of any series is
registered at the close of business on any record date applicable to a
particular series with respect to any interest payment date for such series
shall be entitled to receive the interest, if any, payable on such interest
payment date notwithstanding any transfer or exchange of such Registered
Security subsequent to the record date and prior to such interest payment date,
except if and to the extent the Issuer shall default in the payment of the
interest due on such interest payment date for such series, in which case such
defaulted interest shall be paid to the persons in whose names Outstanding
Registered Securities for such series are registered at the close of business on
a subsequent record date (which shall be not less than five Business Days prior
to the date of payment of such defaulted interest) established by notice given
by mail by or on behalf of the Issuer to the Holders of Registered Securities
not less than 15 days preceding such subsequent record date. The term "record
date" as used with respect to any interest payment date (except a date for
payment of defaulted interest) for the Securities of any series shall mean the
date specified as such in the terms of the Registered Securities of such series
established as contemplated by Section 2.3, or, if no such date is so
established, if such interest payment date is the first day of a calendar month,
the fifteenth day of the preceding calendar month or, if such interest payment
date is the fifteenth day of a calendar month, the first day of such calendar
month, whether or not such record date is a Business Day.

SECTION 2.8 REGISTRATION, TRANSFER AND EXCHANGE. (a) The Issuer will
keep at each office or agency to be maintained for the purpose as provided in
Section 3.2 for each series of Securities a register or registers in which,
subject to such reasonable regulations as the Issuer may prescribe, it will
provide for the registration of Registered Securities of such series and the
registration of transfer of Registered Securities of such series. Such register
shall be in written form in the English language or in any other form capable of
being converted into such form within a reasonable time. At all reasonable
times such register or registers shall be open for inspection by the Trustee.

Upon due presentation for registration of transfer of any Registered
Security of any series at any such office or agency to be maintained for the
purpose as provided in Section 3.2, the Issuer shall execute and the Trustee
shall authenticate and deliver in the name of the transferee or transferees a
new Registered Security or Registered Securities of the same series, maturity
date, interest rate and original issue date in authorized denominations for a
like aggregate principal amount.

Unregistered Securities (except for any temporary global Unregistered
Securities) and Coupons (except for Coupons attached to any temporary global
Unregistered Securities) shall be transferable by delivery.

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At the option of the Holder thereof, Registered Securities of any
series (other than a Registered Global Security, except as set forth below) may
be exchanged for a Registered Security or Registered Securities of such series
having authorized denominations and an equal aggregate principal amount, upon
surrender of such Registered Securities to be exchanged at the agency of the
Issuer that shall be maintained for such purpose in accordance with Section 3.2
and upon payment, if the Issuer shall so require, of the charges hereinafter
provided. If the Securities of any series are issued in both registered and
unregistered form, at the option of the Holder thereof, except as otherwise
specified pursuant to Section 2.3, Unregistered Securities of any series may be
exchanged for Registered Securities of such series having authorized
denominations and an equal aggregate principal amount, upon surrender of such
Unregistered Securities to be exchanged at the agency of the Issuer that shall
be maintained for such purpose in accordance with Section 3.2, with, in the case
of Unregistered Securities that have Coupons attached, all unmatured Coupons and
all matured Coupons in default thereto appertaining, and upon payment, if the
Issuer shall so require, of the charges hereinafter provided. At the option of
the Holder thereof, if Unregistered Securities of any series, maturity date,
interest rate and original issue date are issued in more than one authorized
denomination, except as otherwise specified pursuant to Section 2.3, such
Unregistered Securities may be exchanged for Unregistered Securities of such
series having authorized denominations and an equal aggregate principal amount,
upon surrender of such Unregistered Securities to be exchanged at the agency of
the Issuer that shall be maintained for such purpose in accordance with Section
3.2 or as specified pursuant to Section 2.3, with, in the case of Unregistered
Securities that have Coupons attached, all unmatured Coupons and all matured
Coupons in default thereto appertaining, and upon payment, if the Issuer shall
so require, of the charges hereinafter provided. Registered Securities of any
series may not be exchanged for Unregistered Securities of such series unless
(1) otherwise specified pursuant to Section 2.3 and (2) the Issuer has delivered
to the Trustee an Opinion of Counsel that (x) the Issuer has received from the
IRS a ruling or (y) since the date hereof, there has been a change in the
applicable United States federal income tax law, in either case to the effect
that the inclusion of terms permitting Registered Securities to be exchanged for
Unregistered Securities would result in no United States federal income tax
effect adverse to the Issuer or to any Holder. Whenever any Securities are so
surrendered for exchange, the Issuer shall execute, and the Trustee shall
authenticate and deliver, the Securities which the Holder making the exchange is
entitled to receive. All Securities and Coupons, if any, surrendered upon any
exchange or transfer provided for in this Indenture shall be promptly cancelled
and disposed of by the Trustee, and the Trustee shall deliver a certificate of
disposition thereof to the Issuer.

All Registered Securities presented for registration of transfer,
exchange, redemption or payment shall (if so required by the Issuer or the
Trustee) be duly endorsed, or be accompanied by a written instrument or
instruments of transfer in form satisfactory to the Issuer and the Trustee duly
executed, by the Holder or his attorney duly authorized in writing.

The Issuer may require payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any exchange or
registration of transfer of Securities. No service charge shall be made for any
such transaction.

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The Issuer shall not be required to exchange or register a transfer of
(a) any Securities of any series for a period of 15 days preceding the first
mailing of notice of redemption of Securities of such series to be redeemed or
(b) any Securities selected, called or being called for redemption, in whole or
in part, except, in the case of any Security to be redeemed in part, the portion
thereof not so to be redeemed.

Notwithstanding any other provision of this Section 2.8, unless and
until it is exchanged in whole or in part for Securities in definitive
registered form, a Registered Global Security representing all or a portion of
the Securities of a series may not be transferred except as a whole by the
Depositary for such series to a nominee of such Depositary or by a nominee of
such Depositary to such Depositary or another nominee of such Depositary or by
such Depositary or any such nominee to a successor Depositary for such series or
a nominee of such successor Depositary.

If at any time the Depositary for any Registered Securities of a
series represented by one or more Registered Global Securities notifies the
Issuer that it is unwilling or unable to continue as Depositary for such
Registered Securities or if at any time the Depositary for such Registered
Securities shall no longer be eligible under Section 2.4, the Issuer shall
appoint a successor Depositary eligible under Section 2.4 with respect to such
Registered Securities. If a successor Depositary eligible under Section 2.4 for
such Registered Securities is not appointed by the Issuer within 90 days after
the Issuer receives such notice or becomes aware of such ineligibility, the
Issuer's election pursuant to Section 2.3 that such Registered Securities be
represented by one or more Registered Global Securities shall no longer be
effective and the Issuer will execute, and the Trustee, upon receipt of an
Officer's Certificate for the authentication and delivery of definitive
Securities of such series, will authenticate and deliver, Securities of such
series in definitive registered form without coupons, in any authorized
denominations, in an aggregate principal amount equal to the principal amount of
the Registered Global Security or Securities representing such Registered
Securities in exchange for such Registered Global Security or Securities.

The Issuer may at any time and in its sole discretion determine that
the Registered Securities of any series issued in the form of one or more
Registered Global Securities shall no longer be represented by a Registered
Global Security or Securities. In such event the Issuer will execute, and the
Trustee, upon receipt of any Officer's Certificate for the authentication and
delivery of definitive Securities of such series, will authenticate and deliver,
Securities of such series in definitive registered form without coupons, in any
authorized denominations, in an aggregate principal amount equal to the
principal amount of the Registered Global Security or Securities representing
such Registered Securities, in exchange for such Registered Global Security or
Securities.

If specified by the Issuer pursuant to Section 2.3 with respect to
Securities represented by a Registered Global Security, the Depositary for such
Registered Global Security may surrender such Registered Global Security in
exchange in whole or in part for Securities of

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the same series in definitive registered form on such terms as are acceptable to
the Issuer and such Depositary. Thereupon, the Issuer shall execute, and the
Trustee shall authenticate and deliver, without service charge,

(i) to the Person specified by such Depositary a new Registered
Security or Securities of the same series, of any authorized denominations
as requested by such Person, in an aggregate principal amount equal to and
in exchange for such Person's beneficial interest in the Registered Global
Security; and

(ii) to such Depositary a new Registered Global Security in a
denomination equal to the difference, if any, between the principal amount
of the surrendered Registered Global Security and the aggregate principal
amount of Registered Securities authenticated and delivered pursuant to
clause (i) above.

Upon the exchange of a Registered Global Security for Securities in
definitive registered form without coupons, in authorized denominations, such
Registered Global Security shall be cancelled by the Trustee or an agent of the
Issuer or the Trustee. Securities in definitive registered form without coupons
issued in exchange for a Registered Global Security pursuant to this Section 2.8
shall be registered in such names and in such authorized denominations as the
Depositary for such Registered Global Security, pursuant to instructions from
its direct or indirect participants or otherwise, shall instruct the Trustee or
an agent of the Issuer or the Trustee. The Trustee or such agent shall deliver
such Securities to or as directed by the Persons in whose names such Securities
are so registered.

All Securities issued upon any transfer or exchange of Securities
shall be valid obligations of the Issuer, evidencing the same debt, and entitled
to the same benefits under this Indenture, as the Securities surrendered upon
such transfer or exchange.

Notwithstanding anything herein or in the terms of any series of
Securities to the contrary, none of the Issuer, the Trustee or any agent of the
Issuer or the Trustee (any of which, other than the Issuer, shall rely on an
Officer's Certificate and an Opinion of Counsel) shall be required to exchange
any Unregistered Security for a Registered Security if such exchange would
result in United States federal income tax consequences adverse to the Issuer
(such as, for example, the inability of the Issuer to deduct from its income, as
computed for United States federal income tax purposes, the interest payable on
the Unregistered Securities) under then applicable United States federal income
tax laws.

SECTION 2.9 MUTILATED, DEFACED, DESTROYED, LOST AND STOLEN
SECURITIES. In case any temporary or definitive Security or any Coupon
appertaining to any Security shall be mutilated, defaced, destroyed, lost or
stolen, the Issuer in its discretion may execute and, upon the written request
of any officer of the Issuer, the Trustee shall authenticate and deliver, a new
Security of the same series, maturity date, interest rate and original issue
date, bearing a number or other distinguishing symbol not contemporaneously

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outstanding, in exchange and substitution for the mutilated or defaced Security,
or in lieu of and in substitution for the Security so destroyed, lost or stolen
with Coupons corresponding to the Coupons appertaining to the Securities so
mutilated, defaced, destroyed, lost or stolen, or in exchange or substitution
for the Security to which such mutilated, defaced, destroyed, lost or stolen
Coupon appertained, with Coupons appertaining thereto corresponding to the
Coupons so mutilated, defaced, destroyed, lost or stolen. In every case, the
applicant for a substitute Security or Coupon shall furnish to the Issuer and to
the Trustee and any agent of the Issuer or the Trustee such security or
indemnity as may be required by them to indemnify and defend and to save each of
them harmless and, in every case of destruction, loss or theft, evidence to
their satisfaction of the destruction, loss or theft of such Security or Coupon
and of the ownership thereof, and in the case of mutilation or defacement shall
surrender the Security and related Coupons to the Trustee or such agent.

Upon the issuance of any substitute Security or Coupon, the Issuer may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Trustee) or its agent connected therewith. In case
any Security or Coupon which has matured or is about to mature or has been
called for redemption in full shall become mutilated or defaced or be destroyed,
lost or stolen, the Issuer may, instead of issuing a substitute Security, pay or
authorize the payment of the same or the relevant Coupon (without surrender
thereof except in the case of a mutilated or defaced Security or Coupon), if the
applicant for such payment shall furnish to the Issuer and to the Trustee and
any agent of the Issuer or the Trustee such security or indemnity as any of them
may require to save each of them harmless, and, in every case of destruction,
loss or theft, the applicant shall also furnish to the Issuer and the Trustee
and any agent of the Issuer or the Trustee evidence to their satisfaction of the
destruction, loss or theft of such Security or Coupons and of the ownership
thereof.

Every substitute Security or Coupon of any series issued pursuant
to the provisions of this Section by virtue of the fact that any such
Security or Coupon is destroyed, lost or stolen shall constitute an
additional contractual obligation of the Issuer, whether or not the
destroyed, lost or stolen Security or Coupon shall be at any time enforceable
by anyone and shall be entitled to all the benefits of (but shall be subject
to all the limitations of rights set forth in) this Indenture equally and
proportionately with any and all other Securities or Coupons of such series
duly authenticated and delivered hereunder. All Securities and Coupons shall
be held and owned upon the express condition that, to the extent permitted by
law, the foregoing provisions are exclusive with respect to the replacement
or payment of mutilated, defaced or destroyed, lost or stolen Securities and
Coupons and shall preclude any and all other rights or remedies
notwithstanding any law or statute existing or hereafter enacted to the
contrary with respect to the replacement or payment of negotiable instruments
or other securities without their surrender.

SECTION 2.10 CANCELLATION OF SECURITIES; DESTRUCTION THEREOF. All
Securities and Coupons surrendered for payment, redemption, registration of
transfer or exchange, or for credit against any payment in respect of a sinking
or analogous fund,

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if any, if surrendered to the Issuer or any agent of the Issuer or the Trustee
or any agent of the Trustee, shall be delivered to the Trustee or its agent for
cancellation or, if surrendered to the Trustee, shall be cancelled by it; and no
Securities or Coupons shall be issued in lieu thereof except as expressly
permitted by any of the provisions of this Indenture. The Trustee or its agent
shall dispose of cancelled Securities and Coupons held by it and deliver a
certificate of disposition to the Issuer. If the Issuer or its agent shall
acquire any of the Securities or Coupons, such acquisition shall not operate as
a redemption or satisfaction of the indebtedness represented by such Securities
or Coupons unless and until the same are delivered to the Trustee or its agent
for cancellation.

SECTION 2.11 TEMPORARY SECURITIES. Pending the preparation of
definitive Securities for any series, the Issuer may execute and the Trustee
shall authenticate and deliver temporary Securities for such series (printed,
lithographed, typewritten or otherwise reproduced, in each case in form
satisfactory to the Trustee). Temporary Securities of any series shall be
issuable as Registered Securities without coupons, or as Unregistered Securities
with or without coupons attached thereto, of any authorized denomination, and
substantially in the form of the definitive Securities of such series but with
such omissions, insertions and variations as may be appropriate for temporary
Securities, all as may be determined by the Issuer with the concurrence of the
Trustee as evidenced by the execution and authentication thereof. Temporary
Securities may contain such references to any provisions of this Indenture as
may be appropriate. Every temporary Security shall be executed by the Issuer
and be authenticated by the Trustee upon the same conditions and in
substantially the same manner, and with like effect, as the definitive
Securities. Without unreasonable delay the Issuer shall execute and shall
furnish definitive Securities of such series and thereupon temporary Registered
Securities of such series may be surrendered in exchange therefor without charge
at each office or agency to be maintained by the Issuer for that purpose
pursuant to Section 3.2 and, in the case of Unregistered Securities, at any
agency maintained by the Issuer for such purpose as specified pursuant to
Section 2.3, and the Trustee shall authenticate and deliver in exchange for such
temporary Securities of such series an equal aggregate principal amount of
definitive Securities of the same series having authorized denominations and, in
the case of Unregistered Securities, having attached thereto any appropriate
Coupons. Until so exchanged, the temporary Securities of any series shall be
entitled to the same benefits under this Indenture as definitive Securities of
such series, unless otherwise established pursuant to Section 2.3. The
provisions of this Section are subject to any restrictions or limitations on the
issue and delivery of temporary Unregistered Securities of any series that may
be established pursuant to Section 2.3 (including any provision that
Unregistered Securities of such series initially be issued in the form of a
single global Unregistered Security to be delivered to a depositary or agency
located outside the United States and the procedures pursuant to which
definitive or global Unregistered Securities of such series would be issued in
exchange for such temporary global Unregistered Security).

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ARTICLE III

COVENANTS OF THE ISSUER

SECTION 3.1 PAYMENT OF PRINCIPAL AND INTEREST. The Issuer covenants
and agrees for the benefit of each series of Securities that it will duly and
punctually pay or cause to be paid the principal of, and interest on, if any,
each of the Securities of such series (together with any additional amounts
payable pursuant to the terms of such Securities) at the place or places, at the
respective time or times and in the manner provided in such Securities and in
the Coupons, if any, appertaining thereto and in this Indenture. The interest
on Securities with Coupons attached (together with any additional amounts
payable pursuant to the terms of such Securities) shall be payable only upon
presentation and surrender of the several Coupons for such interest installments
as are evidenced thereby as they severally mature. If any temporary
Unregistered Security provides that interest thereon may be paid while such
Security is in temporary form, the interest on any such temporary Unregistered
Security (together with any additional amounts payable pursuant to the terms of
such Security) shall be paid, as to the installments of interest evidenced by
Coupons attached thereto, if any, only upon presentation and surrender thereof,
and, as to the other installments of interest, if any, only upon presentation of
such Securities for notation thereon of the payment of such interest, in each
case subject to any restrictions that may be established pursuant to Section
2.3. The interest, if any, on Registered Securities (together with any
additional amounts payable pursuant to the terms of such Securities) shall be
payable only to or upon the written order of the Holders thereof and, at the
option of the Issuer, may be paid by wire transfer or by mailing checks for such
interest payable to or upon the written order of such Holders at their last
addresses as they appear on the Securities register of the Issuer.

SECTION 3.2 OFFICES FOR PAYMENTS, ETC. So long as any Registered
Securities are authorized for issuance pursuant to this Indenture or are
outstanding hereunder, the Issuer will maintain in the Borough of Manhattan, The
City of New York, an office or agency where the Registered Securities of each
series may be presented for payment, where the Securities of each series may be
presented for exchange as is provided in this Indenture and, if applicable,
pursuant to Section 2.3 and where the Registered Securities of each series may
be presented for registration of transfer as in this Indenture provided.

The Issuer will maintain one or more offices or agencies in a city or
cities located outside the United States (including any city in which such an
agency is required to be maintained under the rules of any stock exchange on
which the Securities of such series are listed) where the Unregistered
Securities, if any, of each series and Coupons, if any, appertaining thereto may
be presented for payment. No payment on any Unregistered Security or Coupon
will be made upon presentation of such Unregistered Security or Coupon at an
agency of the Issuer within the United States nor will any payment be made by
transfer to an account in, or by mail to an address in, the United States unless
pursuant to applicable United States laws and regulations then in effect such
payment can be made without tax consequences adverse to the Issuer.
Notwithstanding the

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foregoing, payments in Dollars of Unregistered Securities of any series and
Coupons appertaining thereto which are payable in Dollars may be made at an
agency of the Issuer maintained in the Borough of Manhattan, The City of New
York if such payment in Dollars at each agency maintained by the Issuer outside
the United States for payment on such Unregistered Securities is illegal or
effectively precluded by exchange controls or other similar restrictions.

The Issuer will maintain in the Borough of Manhattan, The City of New
York, an office or agency where notices and demands to or upon the Issuer in
respect of the Securities of any series, the Coupons appertaining thereto or
this Indenture may be served.

The Issuer will give to the Trustee written notice of the location of
each such office or agency and of any change of location thereof. In case the
Issuer shall fail to maintain any agency required by this Section to be located
in the Borough of Manhattan, The City of New York, or shall fail to give such
notice of the location or for any change in the location of any of the above
agencies, presentations and demands may be made and notices may be served at the
Corporate Trust Office of the Trustee.

The Issuer may from time to time designate one or more additional
offices or agencies where the Securities of a series and any Coupons
appertaining thereto may be presented for payment, where the Securities of that
series may be presented for exchange as provided in this Indenture and pursuant
to Section 2.3 and where the Registered Securities of that series may be
presented for registration of transfer as in this Indenture provided, and the
Issuer may from time to time rescind any such designation, as the Issuer may
deem desirable or expedient; PROVIDED, that no such designation or rescission
shall in any manner relieve the Issuer of its obligations to maintain the
agencies provided for in this Section. The Issuer shall give to the Trustee
prompt written notice of any such designation or rescission thereof.

SECTION 3.3 APPOINTMENT TO FILL A VACANCY IN OFFICE OF TRUSTEE. The
Issuer, whenever necessary to avoid or fill a vacancy in the office of Trustee,
will appoint, in the manner provided in Section 6.10, a Trustee, so that there
shall at all times be a Trustee with respect to each series of Securities
hereunder.

SECTION 3.4 PAYING AGENTS. Whenever the Issuer shall appoint a
paying agent other than the Trustee with respect to the Securities of any
series, it will cause such paying agent to execute and deliver to the Trustee an
instrument in which such agent shall agree with the Trustee, subject to the
provisions of this Section,

(a) that it will hold all sums received by it as such agent for the
payment of the principal of or interest on the Securities of such series
(whether such sums have been paid to it by the Issuer or by any other
obligor on the Securities of such series) in trust for the benefit of the
Holders of the Securities of such series, or Coupons appertaining thereto,
if any, or of the Trustee;

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(b) that it will give the Trustee notice of any failure by the Issuer
(or by any other obligor on the Securities of such series) to make any
payment of the principal of or interest on the Securities of such series
when the same shall be due and payable; and

(c) that it will pay any such sums so held in trust by it to the
Trustee upon the Trustee's written request at any time during the
continuance of the failure referred to in the foregoing clause (b).

The Issuer will, on or prior to each due date of the principal of or
interest on the Securities of such series, deposit with the paying agent a sum
sufficient to pay such principal or interest so becoming due, and (unless such
paying agent is the Trustee) the Issuer will promptly notify the Trustee of any
failure to take such action.

If the Issuer shall act as its own paying agent with respect to the
Securities of any series, it will, on or before each due date of the principal
of or interest on the Securities of such series, set aside, segregate and hold
in trust for the benefit of the Holders of the Securities of such series or the
Coupons appertaining thereto a sum sufficient to pay such principal or interest
so becoming due. The Issuer will promptly notify the Trustee of any failure to
take such action.

Anything in this Section to the contrary notwithstanding, but subject
to Section 10.1, the Issuer may at any time, for the purpose of obtaining a
satisfaction and discharge with respect to one or more or all series of
Securities hereunder, or for any other reason, pay or cause to be paid to the
Trustee all sums held in trust for any such series by the Issuer or any paying
agent hereunder, as required by this Section, such sums to be held by the
Trustee upon the trusts herein contained.

Anything in this Section to the contrary notwithstanding, the
agreement to hold sums in trust as provided in this Section is subject to the
provisions of Sections 10.3 and 10.4.

SECTION 3.5 COMPLIANCE CERTIFICATES. The Issuer will furnish to the
Trustee on or before January 31 in each year (beginning with [ ]) a
brief certificate (which need not comply with Section 11.5) from the principal
executive, financial or accounting officer of the Issuer stating that in the
course of the performance by the signer of his or her duties as an officer of
the Issuer he or she would normally have knowledge of any default or
non-compliance by the Issuer in the performance of any covenants or conditions
contained in this Indenture, stating whether or not he or she has knowledge of
any such default or non-compliance and, if so, describing each such default or
non-compliance of which the signer has knowledge and the nature thereof.

SECTION 3.6 CORPORATE EXISTENCE. Subject to Article IX, the Issuer
will do or cause to be done all things necessary to preserve and keep in full
force and effect its corporate existence and the rights (charter and statutory),
licenses and franchises of the Issuer and its Subsidiaries; PROVIDED, that the
Issuer shall not be required to preserve any such right, license

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or franchise, if, in the judgment of the Issuer, the preservation thereof is no
longer desirable in the conduct of the business of the Issuer and its
Subsidiaries taken as a whole and the loss thereof is not disadvantageous in any
material respect to the Securityholders.

SECTION 3.7 MAINTENANCE OF PROPERTIES. The Issuer will cause all
properties used in or useful in the conduct of its business or the business of
any Subsidiary to be maintained and kept in good condition, repair, and working
order and supplied with all necessary equipment and will cause to be made all
necessary repairs, renewals, replacements, betterments and improvements thereof,
all as in the judgment of the Issuer may be necessary, so that the business
carried on in connection therewith may be properly and advantageously conducted
at all times, except to the extent that the Issuer may be prevented from so
doing by circumstances beyond its control; PROVIDED, that nothing in this
Section shall prevent the Issuer from discontinuing the operation or maintenance
of any of such properties, or disposing of any of them, if such discontinuance
or disposal is, in the judgment of the Issuer desirable in the conduct of the
business of the Issuer or any Subsidiary and not disadvantageous in any material
respect to the Securityholders.

SECTION 3.8 PAYMENT OF TAXES AND OTHER CLAIMS. The Issuer will pay
or discharge or cause to be paid or discharged, before the same shall become
delinquent: (a) all taxes, assessments and governmental charges levied or
imposed upon the Issuer or any Subsidiary or upon the income, profits or
property of the Issuer or any Subsidiary; and (b) all lawful claims for labor,
materials and supplies, which, if unpaid, might by law become a lien upon the
property of the Issuer or any Subsidiary; PROVIDED, that the Issuer shall not be
required to pay or discharge or cause to be paid or discharged any such tax,
assessment, charge or claim whose amount, applicability or validity is being
contested in good faith by appropriate proceedings; and PROVIDED FURTHER that
the Issuer shall not be required to cause to be paid or discharged any such tax,
assessment, charge or claim if the Issuer shall determine that such payment is
not advantageous to the conduct of the business of the Issuer and its
Subsidiaries taken as a whole and that the failure so to pay or discharge is not
disadvantageous in any material respect to the Securityholders.

SECTION 3.9 LUXEMBOURG PUBLICATIONS. In the event of the publication
of any notice pursuant to Section 5.11, 6.10(a), 6.11, 8.2, 10.4 or 12.2, the
party making such publication in the Borough of Manhattan, The City of New York
and London shall also, to the extent that notice is required to be given to
Holders of Securities of any series by applicable Luxembourg law or stock
exchange regulation, as evidenced by an Officer's Certificate delivered to such
party, make a similar publication in Luxembourg.

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ARTICLE IV

SECURITYHOLDER LISTS AND REPORTS BY THE
ISSUER AND THE TRUSTEE

SECTION 4.1 ISSUER TO FURNISH TRUSTEE INFORMATION AS TO NAMES AND
ADDRESSES OF SECURITYHOLDERS. If and so long as the Trustee shall not be the
Security registrar for the Securities of any series, the Issuer and any other
obligor on the Securities will furnish or cause to be furnished to the Trustee a
list in such form as the Trustee may reasonably require of the names and
addresses of the Holders of the Registered Securities of such series pursuant to
Section 312 of the Trust Indenture Act:

(a) semi-annually not more than 5 days after each record date for the
payment of interest on such Registered Securities, as hereinabove
specified, as of such record date and on dates to be determined pursuant to
Section 2.3 for non-interest bearing Registered Securities in each year;
and

(b) at such other times as the Trustee may reasonably request in
writing, within thirty days after receipt by the Issuer of any such request
as of a date not more than 15 days prior to the time such information is
furnished.

SECTION 4.2 REPORTS BY THE ISSUER. The Issuer covenants to file with
the Trustee, within 15 days after the Issuer is required to file the same with
the Commission, copies of the annual reports and of the information, documents,
and other reports that the Issuer may be required to file with the Commission
pursuant to Section 13 or Section 15(d) of the Exchange Act or pursuant to
Section 314 of the Trust Indenture Act.

SECTION 4.3 REPORTS BY THE TRUSTEE.

(a) On or before the first July 15 which occurs not less than 60 days
after the earliest date of issuance of any Securities and on or before July
15 in each year thereafter, so long as any Securities are Outstanding
hereunder, the Trustee shall transmit by mail as provided below to the
Securityholders of each series of outstanding Securities, as hereinafter in
this Section provided, a brief report dated as of the preceding May 15 with
respect to:

(i) its eligibility under Section 6.10 and its qualification
under Section 6.9, or in lieu thereof, if to the best of its knowledge
it has continued to be eligible and qualified under such Sections, a
written statement to such effect;

(ii) the character and amount of any advances (and if the
Trustee elects to so state, the circumstances surrounding the making
thereof) made by the Trustee (as such) which remain unpaid on the date
of such report and for the

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reimbursement of which it claims or may claim a lien or charge, prior
to that of the Securities of such series, on any property or funds
held or collected by it as Trustee, except that the Trustee shall not
be required (but may elect) to report such advances if such advances
so remaining unpaid aggregate not more than 0.5% of the principal of
the Securities of such series outstanding on the date of such report;

(iii) the amount, interest rate and maturity date of all
other indebtedness owing by the Issuer (or any other obligor on the
Securities of such series) to the Trustee in its individual capacity
on the date of such report, with a brief description of any property
held as collateral security therefor, except any indebtedness based
upon a creditor relationship;

(iv) the property and funds, if any, physically in the
possession of the Trustee (as such) in respect of the Securities of
such series on the date of such report;

(v) any additional issue of Securities of such series which
the Trustee has not previously reported; and

(vi) any action taken by the Trustee in the performance of
its duties under this Indenture which the Trustee has not previously
reported and which in the Trustee's opinion materially affects the
Securities of such series, except action in respect of a default,
notice of which has been or is to be withheld by it in accordance with
the provisions of Section 5.11.

(b) The Trustee shall transmit to the Securityholders of each series,
as provided in subsection (c) of this Section, a brief report with respect
to the character and amount of any advances (and if the Trustee elects so
to state, the circumstances surrounding the making thereof) made by the
Trustee (as such) in respect of the Securities of such series since the
date of the last report transmitted pursuant to the provisions of
subsection (a) of this Section (or if no such report has yet been so
transmitted, since the date of this Indenture) for the reimbursement of
which it claims or may claim a lien or charge prior to that of the
Securities of such series on property or funds held or collected by it as
Trustee and which it has not previously reported pursuant to this
subsection (b), except that the Trustee shall not be required (but may
elect) to report such advances if such advances remaining unpaid at any
time aggregate 10% or less of the principal amount of Securities of such
series outstanding at such time, such report to be transmitted within 90
days after such time.

(c) Reports pursuant to this Section shall be transmitted by mail to
all Holders of Securities of such series, as the names and addresses of
such Holders appear upon the Securities register as of a date not more than
15 days prior to the mailing thereof.

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(d) A copy of each such report shall, at the time of such
transmission to Securityholders, be furnished to the Issuer and be filed by
the Trustee with each stock exchange upon which the Securities of such
series are listed and also with the Commission. The Issuer agrees to
notify the Trustee when and as Securities of any series become listed on
any national securities exchange.

ARTICLE V

REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT

SECTION 5.1 EVENT OF DEFAULT DEFINED, ACCELERATION OF MATURITY;
WAIVER OF DEFAULT. "Event of Default" with respect to Securities of any
series, wherever used herein, means any one of the following events which shall
have occurred and be continuing (whatever the reason for such Event of Default
and whether it shall be voluntary or involuntary or be effected by operation of
law or pursuant to any judgment, decree or order of any court or any order, rule
or regulation of any administrative or governmental body):

(a) default in the payment of any installment of interest upon any of
the Securities of such series as and when the same shall become due and
payable, and continuance of such default for a period of 30 days; provided
that, a valid extension of an interest payment period by the Issuer in
accordance with the terms of such Securities shall not constitute a failure
to pay interest; or

(b) default in the payment of all or any part of the principal on any
of the Securities of such series as and when the same shall become due and
payable either at maturity, upon any redemption, by declaration or
otherwise; or

(c) default in the payment of any sinking fund installment as and
when the same shall become due and payable by the terms of the Securities
of such series; or

(d) failure on the part of the Issuer duly to observe or perform any
other of the covenants or agreements on the part of the Issuer in the
Securities of such series or contained in this Indenture (other than a
covenant or agreement included in this Indenture solely for the benefit of
a series of Securities other than such series) for a period of 90 days
after the date on which written notice specifying such failure, stating
that such notice is a "Notice of Default" hereunder and demanding that the
Issuer remedy the same, shall have been given by registered or certified
mail, return receipt requested, to the Issuer by the Trustee, or to the
Issuer and the Trustee by the holders of at least 25% in aggregate
principal amount of the Outstanding Securities of the series to which such
covenant or agreement relates; or

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<PAGE>

(e) a court having jurisdiction in the premises shall enter a decree
or order for relief in respect of the Issuer in an involuntary case under
any applicable bankruptcy, insolvency or other similar law now or hereafter
in effect, or appointing a receiver, liquidator, assignee, custodian,
trustee, sequestrator (or similar official) of the Issuer for any
substantial part of its or their property or ordering the winding up or
liquidation of its or their affairs, and such decree or order shall remain
unstayed and in effect for a period of 60 consecutive days; or

(f) the Issuer shall commence a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or
consent to the entry of an order for relief in an involuntary case under
any such law, or consent to the appointment or taking possession by a
receiver, liquidator, assignee, custodian, trustee, sequestrator (or
similar official) of the Issuer or for any substantial part of its or their
property, or make any general assignment for the benefit of creditors; or

(g) any other Event of Default provided in the supplemental indenture
or Board Resolution under which such series of Securities is issued or in
the form of Security for such series.

If an Event of Default described in clause (a), (b) or (c) occurs and
is continuing, then, and in each and every such case, except for any series of
Securities the principal of which shall have already become due and payable,
either the Trustee or the Holders of not less than 25% in aggregate principal
amount of the Securities of each such affected series then Outstanding hereunder
(each such series voting as a separate class) by notice in writing to the Issuer
(and to the Trustee if given by Securityholders), may declare the entire
principal (or, if the Securities of such series are Original Issue Discount
Securities, such portion of the principal amount as may be specified in the
terms of such series) of all Securities of such series, and the interest accrued
thereon, if any, to be due and payable immediately, and upon any such
declaration, the same shall become immediately due and payable.

Except as otherwise provided in the terms of any series of Senior
Securities pursuant to Section 2.3, if an Event of Default described in clause
(d) or (g) above with respect to all series of the Senior Securities then
Outstanding, occurs and is continuing, then, and in each and every such case,
unless the Principal of all of the Senior Securities shall have already become
due and payable, either the Trustee or the Holders of not less than 25% in
aggregate principal amount of all of the Senior Securities then Outstanding
hereunder (treated as one class) by notice in writing to the Issuer (and to the
Trustee if given by Securityholders), may declare the entire principal (or, if
the Senior Securities of any series are Original Issue Discount Securities, such
portion of the principal amount as may be specified in the terms of such series)
of all of the Senior Securities then Outstanding, and the interest accrued
thereon, if any, to be due and payable immediately, and upon such declaration,
the same shall become immediately due and payable. If an Event of Default
described in clause (e) or (f) above occurs and is continuing, then the
principal amount of all the Senior Securities then Outstanding, and the interest
accrued thereon,

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if any, shall become and be immediately due and payable without any declaration
or other act on the part of the Trustee or any Holder.

Except as otherwise provided in the terms of any series of
Subordinated Securities pursuant to Section 2.3, if an Event of Default
described in clause (d) or (g) above with respect to all series of Subordinated
Securities then Outstanding, occurs and is continuing, then, and in each and
every such case, unless the Principal of all of the Subordinated Securities
shall have already become due and payable, either the Trustee or the Holders of
not less than 25% in aggregate principal amount of all of the Subordinated
Securities then Outstanding hereunder (treated as one class) by notice in
writing to the Issuer (and to the Trustee if given by Securityholders), may
declare the entire principal (or, if the Subordinated Securities of any series
are Original Issue Discount Securities, such portion of the principal amount as
may be specified in the terms of such series) of all of the Subordinated
Securities then Outstanding, and the interest accrued thereon, if any, to be due
and payable immediately, and upon such declaration, the same shall become
immediately due and payable. If an Event of Default described in clause (e) or
(f) above occurs and is continuing, then the principal amount of all of the
Subordinated Securities then Outstanding, and the interest accrued thereon, if
any, shall become and be immediately due and payable without any declaration or
other act on the part of the Trustee or any Holder.

If an Event of Default described in clause (d) or (g) occurs and is
continuing, which Event of Default is with respect to less than all series of
Senior Securities then Outstanding, then, and in each and every such case,
except for any series of Senior Securities the principal of which shall have
already become due and payable, either the Trustee or the Holders of not less
than 25% in aggregate principal amount of the Senior Securities of each such
affected series then Outstanding hereunder (each such series voting as a
separate class) by notice in writing to the Issuer (and to the Trustee if given
by Securityholders), may declare the entire principal (or, if the Securities of
such series are Original Issue Discount Securities, such portion of the
principal amount as may be specified in the terms of such series) of all
Securities of such series, and the interest accrued thereon, if any, to be due
and payable immediately, and upon any such declaration, the same shall become
immediately due and payable.

If an Event of Default described in clause (d) or (g) occurs and is
continuing, which Event of Default is with respect to less than all series of
Subordinated Securities then Outstanding, then, and in each and every such case,
except for any series of Subordinated Securities the principal of which shall
have already become due and payable, either the Trustee or the Holders of not
less than 25% in aggregate principal amount of the Subordinated Securities of
each such affected series then Outstanding hereunder (each such series voting as
a separate class) by notice in writing to the Issuer (and to the Trustee if
given by Securityholders), may declare the entire principal (or, if the
Securities of such series are Original Issue Discount Securities, such portion
of the principal amount as may be specified in the terms of such series) of all
Securities of such series, and the interest accrued thereon, if any, to be due
and payable immediately, and upon any such declaration, the same shall become
immediately due and payable.

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<PAGE>

The foregoing provisions are subject to the condition that if, at any
time after the principal (or, if the Securities are Original Issue Discount
Securities, such portion of the principal as may be specified in the terms
thereof) of the Securities of any series (or of all the Securities, as the case
may be) shall have been so declared due and payable, and before any judgment or
decree for the payment of the moneys due shall have been obtained or entered as
hereinafter provided,

(A) the Issuer shall pay or shall deposit with the Trustee a sum
sufficient to pay

(i) all matured installments of interest upon all the
Securities of such series (or all the Securities, as the case may be);
and

(ii) the principal of any and all Securities of such series
(or of all the Securities, as the case may be) which shall have become
due otherwise than by acceleration; and

(iii) interest upon such principal and, to the extent that
payment of such interest is enforceable under applicable law, on
overdue installments of interest, at the same rate as the rate of
interest or Yield to Maturity (in the case of Original Issue Discount
Securities) specified in the Securities of such series (or at the
respective rates of interest or Yields to Maturity of all the
Securities, as the case may be) to the date of such payment or
deposit; and

(iv) all amounts payable to the Trustee pursuant to Section
6.6; and

(B) all Events of Default under the Indenture, other than the
non-payment of the principal of Securities which shall have become due by
acceleration, shall have been cured, waived or otherwise remedied as
provided herein,

then and in every such case the Holders of a majority in aggregate principal
amount of all the Securities of such series voting as a separate class (or all
the Securities, as the case may be, voting as a single class), then Outstanding,
by written notice to the Issuer and to the Trustee, may waive all defaults with
respect to such series (or with respect to all the Securities, as the case may
be) and rescind and annul such declaration and its consequences, but no such
waiver or rescission and annulment shall extend to or shall affect any
subsequent default or shall impair any right consequent thereon.

For all purposes under this Indenture, if a portion of the principal
of any Original Issue Discount Securities shall have been accelerated and
declared due and payable pursuant to the provisions hereof, then, from and after
such declaration, unless such declaration has been rescinded and annulled, the
principal amount of such Original Issue Discount Securities shall be deemed, for
all purposes hereunder, to be such portion of the principal thereof as shall be
due and payable as a result of such acceleration, and payment of such portion of
the principal thereof as

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<PAGE>

shall be due and payable as a result of such acceleration, together with
interest, if any, thereon and all other amounts owing thereunder, shall
constitute payment in full of such Original Issue Discount Securities.

SECTION 5.2 COLLECTION OF INDEBTEDNESS BY TRUSTEE; TRUSTEE MAY PROVE
DEBT. The Issuer covenants that (a) in case default shall be made in the
payment of any installment of interest on any of the Securities of any series
when such interest shall have become due and payable, and such default shall
have continued for a period of 30 days, or (b) in case default shall be made in
the payment of all or any part of the principal of any of the Securities of any
series when the same shall have become due and payable, whether upon maturity of
the Securities of such series or upon any redemption or by declaration or
otherwise, then upon demand of the Trustee, the Issuer will pay to the Trustee
for the benefit of the Holders of the Securities of such series the whole amount
that then shall have become due and payable on all Securities of such series,
and such Coupons, for principal and interest, as the case may be (with interest
to the date of such payment upon the overdue principal and, to the extent that
payment of such interest is enforceable under applicable law, on overdue
installments of interest at the same rate as the rate of interest or Yield to
Maturity (in the case of Original Issue Discount Securities) specified in the
Securities of such series); and in addition thereto, such further amount as
shall be sufficient to cover the costs and expenses of collection, and such
other amount due the Trustee under Section 6.6 in respect of Securities of such
series.

Until such demand is made by the Trustee, the Issuer may pay the
principal of and interest on the Securities of any series to the registered
Holders, whether or not the Securities of such series be overdue.

In case the Issuer shall fail forthwith to pay such amounts upon such
demand, the Trustee, in its own name as trustee of an express trust, shall be
entitled and empowered to institute any action or proceedings at law or in
equity for the collection of the sums so due and unpaid, and may prosecute any
such action or proceedings to judgment or final decree, and may enforce any such
judgment or final decree against the Issuer or other obligor upon the Securities
and collect in the manner provided by law out of the property of the Issuer or
other obligor upon the Securities, wherever situated, all the moneys adjudged or
decreed to be payable.

In case there shall be pending proceedings relative to the Issuer or
any other obligor upon the Securities under Title 11 of the United States Code
or any other applicable federal or state bankruptcy, insolvency or other similar
law, or in case a receiver, assignee or trustee in bankruptcy or reorganization,
liquidator, sequestrator or similar official shall have been appointed for or
taken possession of the Issuer or its property or such other obligor, or in case
of any other comparable judicial proceedings relative to the Issuer or other
obligor upon the Securities, or to the creditors or property of the Issuer or
such other obligor, the Trustee, irrespective of whether the principal of the
Securities shall then be due and payable as therein expressed or by declaration
or otherwise and irrespective of whether the Trustee shall have made

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<PAGE>

any demand pursuant to the provisions of this Section, shall be entitled and
empowered, by intervention in such proceedings or otherwise:

(a) to file and prove a claim or claims for the whole amount of
principal and interest (or, if the Securities of any series are Original
Issue Discount Securities, such portion of the principal amount as may be
specified in the terms of such series) owing and unpaid in respect of the
Securities of any series, and to file such other papers or documents as may
be necessary or advisable in order to have the claims of the Trustee
(including any claim for amounts payable to the Trustee under Section 6.6)
and of the Securityholders allowed in any judicial proceedings relative to
the Issuer or other obligor upon the Securities, or to the creditors or
property of the Issuer or such other obligor; and

(b) unless prohibited by applicable law and regulations, to vote on
behalf of the holders of the Securities of any series in any election of a
receiver, assignee, trustee or a standby trustee in arrangement,
reorganization, liquidation or other bankruptcy or insolvency proceedings,
custodian or other person performing similar functions in respect of any
such proceedings; and

(c) to collect and receive any moneys or other property payable or
deliverable on any such claims, and to distribute all amounts received with
respect to the claims of the Securityholders and of the Trustee on their
behalf; and any trustee, receiver, or liquidator, custodian or other
similar official performing similar functions in respect of any such
proceedings is hereby authorized by each of the Securityholders to make
payments to the Trustee, and, in the event that the Trustee shall consent
to the making of payments directly to the Securityholders, to pay to the
Trustee its costs and expenses of collection and all other amounts due to
it pursuant to Section 6.6.

Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or vote for or accept or adopt on behalf of any
Securityholder any plan of reorganization, arrangement, adjustment or
composition affecting the Securities of any series or the rights of any Holder
thereof, or to authorize the Trustee to vote in respect of the claim of any
Securityholder in any such proceeding, except as aforesaid in clause (b).

All rights of action and of asserting claims under this Indenture, or
under any of the Securities of any series or Coupons appertaining to such
Securities, may be enforced by the Trustee without the possession of any of the
Securities of such series or Coupons appertaining to such Securities or the
production thereof in any trial or other proceedings relative thereto, and any
such action or proceedings instituted by the Trustee shall be brought in its own
name as trustee of an express trust, and any recovery of judgment shall be
awarded to the Trustee for ratable distribution to the Holders of the Securities
or Coupons appertaining to such Securities in respect of which such action was
taken, after payment of all sums due to the Trustee under Section 6.6 in respect
of such Securities.

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In any proceedings brought by the Trustee (and also any proceedings
involving the interpretation of any provision of this Indenture to which the
Trustee shall be a party) the Trustee shall be held to represent all the Holders
of the Securities or Coupons appertaining to such Securities in respect to which
such action was taken, and it shall not be necessary to make any Holders of such
Securities or Coupons appertaining to such Securities parties to any such
proceedings.

SECTION 5.3 APPLICATION OF PROCEEDS. Any moneys collected by the
Trustee pursuant to this Article in respect of any series shall be applied in
the following order at the date or dates fixed by the Trustee and, in case of
the distribution of such moneys on account of principal or interest, upon
presentation of the several Securities and Coupons appertaining to such
Securities in respect of which monies have been collected and stamping (or
otherwise noting) thereon the payment, or issuing Securities of such series in
reduced principal amounts in exchange for the presented Securities of like
series if only partially paid, or upon surrender thereof if fully paid:

FIRST: To the payment of costs and expenses applicable to such
series of Securities in respect of which monies have been collected,
including all amounts due to the Trustee and each predecessor Trustee
pursuant to Section 6.6 in respect to such series of Securities;

SECOND: In case the principal of the Securities of such series
in respect of which moneys have been collected shall not have become
and be then due and payable, to the payment of interest on the
Securities of such series in default in the order of the maturity of
the installments on such interest, with interest (to the extent that
such interest has been collected by the Trustee and is permitted by
applicable law) upon the overdue installments of interest at the same
rate as the rate of interest or Yield to Maturity (in the case of
Original Issue Discount Securities) specified in such Securities, such
payments to be made ratably to the persons entitled thereto, without
discrimination or preference;

THIRD: In case the principal of the Securities of such series in
respect of which moneys have been collected shall have become and
shall be then due and payable, to the payment of the whole amount then
owing and unpaid upon all the Securities of such series for principal
and interest, with interest upon the overdue principal, and (to the
extent that such interest has been collected by the Trustee and is
permitted by applicable law) upon the overdue installations of
interest at the same rate as the rate of interest or Yield to Maturity
(in the case of Original Issue Discount Securities) specified in the
Securities of such series; and in case such moneys shall be
insufficient to pay in full the whole amount so due and unpaid upon
the Securities of such series, then to the payment of such principal
and interest or Yield to Maturity, without preference or priority of
principal over interest or Yield to Maturity, or of interest or Yield
to Maturity over principal, or

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of any installment of interest over any other installment of interest or of
any Security of such series over any other Security of such series, ratably
to the aggregate of such principal and accrued and unpaid interest or Yield
to Maturity; and

FOURTH: To the payment of the remainder, if any, to the Issuer
or any other person lawfully entitled thereto.

SECTION 5.4 SUITS FOR ENFORCEMENT. In case an Event of Default has
occurred, has not been waived and is continuing, the Trustee may in its
discretion proceed to protect and enforce the rights vested in it by this
Indenture by such appropriate judicial proceedings as the Trustee shall deem
most effectual to protect and enforce any of such rights, either at law or in
equity or in bankruptcy or otherwise, whether for the specific enforcement of
any covenant or agreement contained in this Indenture or in aid of the exercise
of any power granted in this Indenture or to enforce any other legal or
equitable right vested in the Trustee by this Indenture or by law.

SECTION 5.5 RESTORATION OF RIGHTS ON ABANDONMENT OF PROCEEDINGS. In
case the Trustee shall have proceeded to enforce any right under this Indenture
and such proceedings shall have been discontinued or abandoned for any reason,
or shall have been determined adversely to the Trustee, then and in every such
case the Issuer and the Trustee shall be restored respectively to their former
positions and rights hereunder, and all rights, remedies and powers of the
Issuer, the Trustee and the Securityholders shall continue as though no such
proceedings had been taken.

SECTION 5.6 LIMITATIONS ON SUITS BY SECURITY HOLDERS. No Holder of
any Security of any series or of any Coupon appertaining thereto shall have any
right by virtue or by availing of any provision of this Indenture to institute
any action or proceeding at law or in equity or in bankruptcy or otherwise upon
or under or with respect to this Indenture or such Security, or for the
appointment of a trustee, receiver, liquidator, custodian or other similar
official or for any other remedy hereunder or thereunder, unless (a) such Holder
previously shall have given to the Trustee written notice of an Event of Default
with respect to Securities of such series and of the continuance thereof, as
hereinbefore provided, and (b) the Holders of not less than 25% in aggregate
principal amount of the Securities of such series then Outstanding (treated as a
single class) shall have made written request upon the Trustee to institute such
action or proceedings in its own name as Trustee hereunder and shall have
offered to the Trustee such reasonable indemnity as it may require against the
costs, expenses and liabilities to be incurred therein or thereby, and (c) the
Trustee for 60 days after its receipt of such notice, request and offer of
indemnity shall have failed to institute any such action or proceeding, and (d)
no direction inconsistent with such written request shall have been given to the
Trustee pursuant to Section 5.9; it being understood and intended, and being
expressly covenanted by the taker and Holder of every Security or Coupon with
every other taker and Holder and the Trustee, that no one or more Holders of
Securities of any series or Coupons appertaining to such Securities shall

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<PAGE>

have any right in any manner whatever by virtue or by availing of any provision
of this Indenture or any Security to affect, disturb or prejudice the rights of
any other such taker or Holder of Securities or Coupons appertaining to such
Securities, or to obtain or seek to obtain priority over or preference to any
other such taker or Holder or to enforce any right under this Indenture or any
Security, except in the manner herein provided and for the equal, ratable and
common benefit of all Holders of Securities of the applicable series and Coupons
appertaining to such Securities. For the protection and enforcement of the
provisions of this Section, each and every Securityholder and the Trustee shall
be entitled to such relief as can be given either at law or in equity.

SECTION 5.7 UNCONDITIONAL RIGHT OF SECURITYHOLDERS TO INSTITUTE
CERTAIN SUITS. Notwithstanding any other provision in this Indenture and any
provision of any Security, the right of any Holder of any Security or Coupon to
receive payment of the principal of and interest on such Security or Coupon on
or after the respective due dates expressed in such Security or Coupon or the
applicable redemption dates provided for in such Security, or to institute suit
for the enforcement of any such payment on or after such respective dates, shall
not be impaired or affected without the consent of such Holder.

SECTION 5.8 POWERS AND REMEDIES CUMULATIVE; DELAY OR OMISSION NOT
WAIVER OF DEFAULT. Except as provided in Section 5.6, no right or remedy herein
conferred upon or reserved to the Trustee or to the Holders of Securities or
Coupons is intended to be exclusive of any other right or remedy and every right
and remedy shall, to the extent permitted by law, be cumulative and in addition
to every other right and remedy given hereunder or now or hereafter existing at
law or in equity or otherwise. The assertion or employment of any right or
remedy hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.

No delay or omission of the Trustee or of any Holder of Securities or
Coupons to exercise any right or power accruing upon any Event of Default
occurring and continuing as aforesaid shall impair any such right or power or
shall be construed to be a waiver of any such Event of Default or an
acquiescence therein. Every power and remedy given by this Indenture, any
Security or law to the Trustee or to the Holders of Securities or Coupons may be
exercised from time to time, and as often as shall be deemed expedient, by the
Trustee or, subject to Section 5.6, by the Holders of Securities or Coupons.

SECTION 5.9 CONTROL BY HOLDERS OF SECURITIES. The Holders of a
majority in aggregate principal amount of the Securities of each series affected
(with each such series voting as a separate class) at the time Outstanding shall
have the right to direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee, or exercising any trust or power
conferred on the Trustee with respect to the Securities of such series by this
Indenture; PROVIDED, that such direction shall not be otherwise than in
accordance with law and the provisions of this Indenture; and PROVIDED, FURTHER,
that (subject to the provisions of Section 6.1) the Trustee shall have the right
to decline to follow any such direction if (a) the Trustee, being advised by
counsel, shall determine that the action or proceeding so directed may

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not lawfully be taken; or (b) if the Trustee by its board of directors, the
executive committee or a trust committee of directors or Responsible Officers of
the Trustee shall determine in good faith that the action or proceedings so
directed would involve the Trustee in personal liability; or (c) if the Trustee
in good faith shall so determine that the actions or forbearances specified in
or pursuant to such direction would be unduly prejudicial to the interests of
Holders of the Securities of all affected series not joining in the giving of
said direction, it being understood that (subject to Section 6.1) the Trustee
shall have no duty to ascertain whether or not such actions or forbearances are
unduly prejudicial to such Holders.

Nothing in this Indenture shall impair the right of the Trustee in its
discretion to take any action deemed proper by the Trustee and which is not
inconsistent with such direction or directions by Securityholders.

SECTION 5.10 WAIVER OF PAST DEFAULTS. Prior to the declaration of
acceleration of the maturity of the Securities of any series as provided in
Section 5.1, the Holders of a majority in aggregate principal amount of the
Securities of such series at the time Outstanding (voting as a single class) may
on behalf of the Holders of all such Securities waive any past default or Event
of Default described in Section 5.1 and its consequences, except a default in
respect of a covenant or provision hereof which cannot be modified or amended
without the consent of the Holder of each Security affected. In the case of any
such waiver, the Issuer, the Trustee and the Holders of all such Securities
shall be restored to their former positions and rights hereunder, respectively,
and such default shall cease to exist and be deemed to have been cured and not
to have occurred for purposes of this Indenture; but no such waiver shall extend
to any subsequent or other default or impair any right consequent thereon.

SECTION 5.11 TRUSTEE TO GIVE NOTICE OF DEFAULT, BUT MAY WITHHOLD IN
CERTAIN CIRCUMSTANCES. The Trustee shall, within ninety days after the
occurrence of a default with respect to the Securities of any series, give
notice of all defaults with respect to that series known to the Trustee (i) if
any Unregistered Securities of that series are then Outstanding, to the Holders
thereof, by publication at least once in an Authorized Newspaper in the Borough
of Manhattan, The City of New York and at least once in an Authorized Newspaper
in London (and, if required by Section 3.9, at least once in an Authorized
Newspaper in Luxembourg) and (ii) to all Holders of Securities of such series in
the manner and to the extent provided in Section 313(c) of the Trust Indenture
Act, unless in each case such defaults shall have been cured before the mailing
or publication of such notice (the term "default" for the purpose of this
Section being hereby defined to mean any event or condition which is, or with
notice or lapse of time or both would become, an Event of Default); PROVIDED,
that, except in the case of default in the payment of the principal of or
interest on any of the Securities of such series, or in the payment of any
sinking fund installment on such series, the Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee, or a trust committee of directors or trustees and/or Responsible
Officers of the Trustee in good faith determines that the withholding of such
notice is in the interests of the Securityholders of such series.

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SECTION 5.12 RIGHT OF COURT TO REQUIRE FILING OF UNDERTAKING TO PAY
COSTS. All parties to this Indenture agree, and each Holder of any Security or
Coupon by his acceptance thereof shall be deemed to have agreed, that any court
may in its discretion require, in any suit for the enforcement of any right or
remedy under this Indenture or in any suit against the Trustee for any action
taken, suffered or omitted by it as Trustee, the filing by any party litigant in
such suit of an undertaking to pay the costs of such suit, and that such court
may in its discretion assess reasonable costs, including reasonable attorneys'
fees, against any party litigant in such suit, having due regard to the merits
and good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Securityholder or group of
Securityholders of any series holding in the aggregate more than 10% in
aggregate principal amount of the Securities of such series, or, in the case of
any suit relating to or arising under clause (d) or (g) of Section 5.1 (if the
suit relates to Securities of more than one but less than all series), 10% in
aggregate principal amount of Securities then Outstanding and affected thereby,
or in the case of any suit relating to or arising under clause (d) or (g) (if
the suit under clause (d) or (g) relates to all the Securities then Outstanding)
or (e) or (f) of Section 5.1, 10% in aggregate principal amount of all
Securities then Outstanding, or to any suit instituted by any Securityholder for
the enforcement of the payment of the principal of or interest on any Security
on or after the due date expressed in such Security or any date fixed for
redemption.

ARTICLE VI

CONCERNING THE TRUSTEE

SECTION 6.1 DUTIES AND RESPONSIBILITIES OF THE TRUSTEE; DURING
DEFAULT; PRIOR TO DEFAULT. Prior to the occurrence of an Event of Default with
respect to the Securities of a particular series and after the curing or waiving
of all Events of Default which may have occurred with respect to such series,
the Trustee undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture with respect to such series of
Securities. In case an Event of Default with respect to the Securities of a
series has occurred and has not been cured or waived, the Trustee shall exercise
with respect to such series of Securities such of the rights and powers vested
in it by this Indenture with respect to such series of Securities, and use the
same degree of care and skill in their exercise, as a prudent person would
exercise or use under the circumstances in the conduct of his or her own
affairs.

No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct, except that

(a) prior to the occurrence of an Event of Default with respect to
the Securities of any series and after the curing or waiving of all such
Events of Default with respect to such series which may have occurred:

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(i) the duties and obligations of the Trustee with respect
to the Securities of any series shall be determined solely by the
express provisions of this Indenture, and the Trustee shall not be
liable except for the performance of such duties and obligations as
are specifically set forth in this Indenture, and no implied covenants
or obligations shall be read into this Indenture against the Trustee;
and

(ii) in the absence of bad faith on the part of the Trustee,
the Trustee may conclusively rely, as to the truth of the statements
and the correctness of the opinions expressed therein, upon any
statements, certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture; but in the case of
any such statements, certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine whether
or not they conform to the requirements of this Indenture;

(b) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer or Responsible Officers of the Trustee,
unless it shall be proved that the Trustee was negligent in ascertaining
the pertinent facts; and

(c) the Trustee shall not be liable with respect to any action taken
or omitted to be taken by it in good faith in accordance with the direction
of the Holders pursuant to Section 5.9 relating to the time, method and
place of conducting any proceeding for any remedy available to the Trustee,
or exercising any trust or power conferred upon the Trustee, under this
Indenture.

None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers, if there shall be reasonable ground for believing that the
repayment of such funds or adequate indemnity against such liability is not
reasonably assured to it.

The provisions of this Section 6.1 are in furtherance of and subject
to Section 315 of the Trust Indenture Act.

SECTION 6.2 CERTAIN RIGHTS OF THE TRUSTEE. In furtherance of and
subject to the Trust Indenture Act, and subject to Section 6.1:

(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, Officer's Certificate or any
other certificate, statement, instrument, opinion, report, notice, request,
consent, order, bond, debenture, note, coupon, security or other paper or
document believed by it to be genuine and to have been signed or presented
by the proper party or parties;

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(b) any request, direction, order or demand of the Issuer mentioned
herein shall be sufficiently evidenced by an Officer's Certificate (unless
other evidence in respect thereof is specifically prescribed herein or in
the terms established in respect of any series); and any resolution of the
Board of Directors may be evidenced to the Trustee by a copy thereof
certified by the secretary or an assistant secretary of the Issuer;

(c) the Trustee may consult with counsel and any written advice or
any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted to be taken
by it hereunder in good faith and in reliance thereon in accordance with
such advice or Opinion of Counsel;

(d) the Trustee shall be under no obligation to exercise any of the
trusts or powers vested in it by this Indenture at the request, order or
direction of any of the Securityholders pursuant to the provisions of this
Indenture, unless such Securityholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred therein or thereby;

(e) the Trustee shall not be liable for any action taken or omitted
by it in good faith and believed by it to be authorized or within the
discretion, rights or powers conferred upon it by this Indenture;

(f) prior to the occurrence of an Event of Default hereunder and
after the curing or waiving of all Events of Default, the Trustee shall not
be bound to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, appraisal, bond, debenture, note,
coupon, security or other paper or document unless (i) requested in writing
so to do by the Holders of not less than a majority in aggregate principal
amount of the Securities of all series affected then Outstanding (treated
as one class) or (ii) otherwise provided in the terms of any series of
Securities pursuant to Section 2.3; PROVIDED, that, if the payment within a
reasonable time to the Trustee of the costs, expenses or liabilities likely
to be incurred by it in the making of such investigation is, in the opinion
of the Trustee, not reasonably assured to the Trustee by the security
afforded to it by the terms of this Indenture, the Trustee may require
reasonable indemnity against such expenses or liabilities as a condition to
proceeding; the reasonable expenses of every such investigation shall be
paid by the Issuer or, if paid by the Trustee or any predecessor trustee,
shall be repaid by the Issuer upon demand; and

(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys not regularly in its employ and the Trustee shall not be
responsible for any misconduct or negligence on the part of any such agent
or attorney appointed with due care by it hereunder.

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SECTION 6.3 TRUSTEE NOT RESPONSIBLE FOR RECITALS, DISPOSITION OF
SECURITIES OR APPLICATION OF PROCEEDS THEREOF. The recitals contained herein
and in the Securities, except the Trustee's certificates of authentication,
shall be taken as the statements of the Issuer, and the Trustee assumes no
responsibility for the correctness of the same. The Trustee makes no
representation as to the validity or sufficiency of this Indenture or of the
Securities or Coupons. The Trustee shall not be accountable for the use or
application by the Issuer of any of the Securities or of the proceeds thereof.

SECTION 6.4 TRUSTEE AND AGENTS MAY HOLD SECURITIES OR COUPONS;
COLLECTIONS, ETC. The Trustee or any agent of the Issuer or of the Trustee, in
its individual or any other capacity, may become the owner or pledgee of
Securities or Coupons with the same rights it would have if it were not the
Trustee or such agent and may otherwise deal with the Issuer and receive,
collect, hold and retain collections from the Issuer with the same rights it
would have if it were not the Trustee or such agent.

SECTION 6.5 MONEYS HELD BY TRUSTEE. Subject to the provisions of
Section 10.4 hereof, all moneys received by the Trustee shall, until used or
applied as herein provided, be held in trust for the purposes for which they
were received, but need not be segregated from other funds except to the extent
required by mandatory provisions of law. Neither the Trustee nor any agent of
the Issuer or the Trustee shall be under any liability for interest on any
moneys received by it hereunder.

SECTION 6.6 COMPENSATION AND INDEMNIFICATION OF TRUSTEE AND ITS PRIOR
CLAIM. The Issuer covenants and agrees to pay to the Trustee from time to time,
and the Trustee shall be entitled to reasonable compensation (which shall not be
limited by any provision of law in regard to the compensation of a trustee of an
express trust) and the Issuer covenants and agrees to pay or reimburse the
Trustee and each predecessor trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by or on behalf of it in
accordance with any of the provisions of this Indenture (including the
reasonable compensation and the expenses and disbursements of its counsel and of
all agents and other persons not regularly in its employ) except any such
expense, disbursement or advance as may arise from its negligence or bad faith.
The Issuer also covenants to indemnify the Trustee and each predecessor trustee
for, and to hold it harmless against, any loss, liability or expense incurred
without negligence or bad faith on its part, arising out of or in connection
with the acceptance or administration of this Indenture or the trusts hereunder
and its duties hereunder, including the costs and expenses of defending itself
against or investigating any claim of liability in the premises. The
obligations of the Issuer under this Section to compensate and indemnify the
Trustee and each predecessor trustee and to pay or reimburse the Trustee and
each predecessor trustee for expenses, disbursements and advances shall
constitute additional indebtedness hereunder and shall survive the satisfaction
and discharge of this Indenture and the resignation or removal of the Trustee.
Such additional indebtedness shall be a senior claim to that of the Securities
upon all property and funds held or collected by the Trustee as such, except
funds held

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in trust for the benefit of the Holders of particular Securities or Coupons, and
the Securities are hereby subordinated to such senior claim.

SECTION 6.7 RIGHT OF TRUSTEE TO RELY ON OFFICER'S CERTIFICATE,
ETC. Subject to Sections 6.1 and 6.2, whenever in the administration of the
trusts of this Indenture the Trustee shall deem it necessary or desirable that a
matter be proved or established prior to taking or suffering or omitting any
action hereunder, such matter (unless other evidence in respect thereof be
herein specifically prescribed) may, in the absence of negligence or bad faith
on the part of the Trustee, be deemed to be conclusively proved and established
by an Officer's Certificate delivered to the Trustee, and such certificate, in
the absence of negligence or bad faith on the part of the Trustee, shall be full
warrant to the Trustee for any action taken, suffered or omitted by it under the
provisions of this Indenture upon the faith thereof.

SECTION 6.8 INDENTURES NOT CREATING POTENTIAL CONFLICTING INTERESTS
FOR THE TRUSTEE. The following indentures are hereby specifically described for
the purposes of Section 310(b)(1) of the Trust Indenture Act: this Indenture
with respect to series of Securities that are of an equal priority.

SECTION 6.9 QUALIFICATION OF TRUSTEE: CONFLICTING INTERESTS. The
Trustee shall comply with Section 310(b) of the Trust Indenture Act.

SECTION 6.10 PERSONS ELIGIBLE FOR APPOINTMENT AS TRUSTEE. The
Trustee for each series of Securities hereunder shall at all times be a
corporation or banking association organized and doing business under the laws
of the United States of America, any State thereof or the District of Columbia,
having a combined capital and surplus of at least $50,000,000, and which is
authorized under such laws to exercise corporate trust powers and is subject to
supervision or examination by Federal, state or District of Columbia authority.
If such corporation publishes reports of condition at least annually, pursuant
to law or to the requirements of the aforesaid supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section, the Trustee shall resign immediately in the manner
and with the effect specified in Section 6.11.

The provisions of this Section 6.10 are in furtherance of and subject
to Section 310(a) of the Trust Indenture Act.

SECTION 6.11 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR
TRUSTEE. (a) The Trustee, or any trustee or trustees hereafter appointed, may
at any time resign with respect to one or more or all series of Securities by
giving written notice of resignation to the Issuer and (i) if any Unregistered
Securities of a series affected are then Outstanding, by giving notice of such
resignation to the Holders thereof, by publication at least

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once in an Authorized Newspaper in the Borough of Manhattan, The City of New
York, and at least once in an Authorized Newspaper in London (and, if required
by Section 3.9, at least once in an Authorized Newspaper in Luxembourg), (ii) if
any Unregistered Securities of a series affected are then Outstanding, by
mailing notice of such resignation to the Holders thereof who have filed their
names and addresses with the Trustee pursuant to Section 313(c)(2) of the Trust
Indenture Act at such addresses as were so furnished to the Trustee and (iii) by
mailing notice of such resignation to the Holders of then Outstanding Registered
Securities of each series affected at their addresses as they shall appear on
the registry books. Upon receiving such notice of resignation, the Issuer shall
promptly appoint a successor trustee or trustees with respect to the applicable
series by written instrument in duplicate, executed by authority of the Board of
Directors, one copy of which instrument shall be delivered to the resigning
Trustee and one copy to the successor trustee or trustees. If no successor
trustee shall have been so appointed with respect to any series and have
accepted appointment within 30 days after the mailing of such notice of
resignation, the resigning trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee, or any Securityholder
who has been a bona fide Holder of a Security or Securities of the applicable
series for at least six months may, subject to the provisions of Section 5.12,
on behalf of himself and all others similarly situated, petition any such court
for the appointment of a successor trustee. Such court may thereupon, after
such notice, if any, as it may deem proper and prescribe, appoint a successor
trustee.

(b) In case at any time any of the following shall occur:

(i) the Trustee shall fail to comply with the provisions of
Section 310(b) of the Trust Indenture Act with respect to any series
of Securities after written request therefor by the Issuer or by any
Securityholder who has been a bona fide Holder of a Security or
Securities of such series for at least six months; or

(ii) the Trustee shall cease to be eligible in accordance
with the provisions of Section 6.10 and Section 310(a) of the Trust
Indenture Act and shall fail to resign after written request therefor
by the Issuer or by any Securityholder; or

(iii) the Trustee shall become incapable of acting with
respect to any series of Securities, or shall be adjudged bankrupt or
insolvent, or a receiver or liquidator of the Trustee or of its
property shall be appointed, or any public officer shall take charge
or control of the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation;

then, in any such case, the Issuer may remove the Trustee with respect to the
applicable series of Securities and appoint a successor trustee for such series
by written instrument, in duplicate, executed by order of the Board of Directors
of the Issuer, one copy of which instrument shall be delivered to the Trustee so
removed and one copy to the successor trustee, or, subject to the provisions of
Section 315(e) of the Trust Indenture Act, any Securityholder who has been a
bona

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fide Holder of a Security or Securities of such series for at least six months
may on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee and the appointment of
a successor trustee with respect to such series. Such court may thereupon,
after such notice, if any, as it may deem proper and so prescribe, remove the
Trustee and appoint a successor trustee.

(c) The Holders of a majority in aggregate principal amount of the
Securities of each series at the time outstanding may at any time remove
the Trustee with respect to Securities of such series and appoint a
successor trustee with respect to the Securities of such series by
delivering to the Trustee so removed, to the successor trustee so appointed
and to the Issuer the evidence provided for in Section 7.1 of the action in
that regard taken by the Securityholders.

(d) Any resignation or removal of the Trustee with respect to any
series and any appointment of a successor trustee with respect to such
series pursuant to any of the provisions of this Section 6.11 shall become
effective upon acceptance of appointment by the successor trustee as
provided in Section 6.12.

SECTION 6.12 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR TRUSTEE. Any
successor trustee appointed as provided in Section 6.11 shall execute and
deliver to the Issuer and to its predecessor trustee an instrument accepting
such appointment hereunder, and thereupon the resignation or removal of the
predecessor trustee with respect to all or any applicable series shall become
effective and such successor trustee, without any further act, deed or
conveyance, shall become vested with all rights, powers, duties and obligations
with respect to such series of its predecessor hereunder, with like effect as if
originally named as trustee for such series hereunder; but, nevertheless, on the
written request of the Issuer or of the successor trustee, upon payment of its
charges then unpaid, the trustee ceasing to act shall, subject to Section 10.4,
pay over to the successor trustee all moneys at the time held by it hereunder
and shall execute and deliver an instrument transferring to such successor
trustee all such rights, powers, duties and obligations. Upon request of any
such successor trustee, the Issuer shall execute any and all instruments in
writing for more fully and certainly vesting in and confirming to such successor
trustee all such rights and powers. Any trustee ceasing to act shall,
nevertheless, retain a prior claim upon all property or funds held or collected
by such trustee to secure any amounts then due it pursuant to the provisions of
Section 6.6.

If a successor trustee is appointed with respect to the Securities of
one or more (but not all) series, the Issuer, the predecessor trustee and each
successor trustee with respect to the Securities of any applicable series shall
execute and deliver an indenture supplemental hereto which shall contain such
provisions as shall be deemed necessary or desirable to confirm that all the
rights, powers, trusts and duties of the predecessor trustee with respect to the
Securities of any series as to which the predecessor trustee is not retiring
shall continue to be vested in the predecessor trustee, and shall add to or
change any of the provisions of this Indenture as shall be necessary to provide
for or facilitate the administration of the trusts hereunder by more than one

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trustee, it being understood that nothing herein or in such supplemental
indenture shall constitute such trustees co-trustees of the same trust and that
each such trustee shall be trustee of a trust or trusts under separate
indentures.

No successor trustee with respect to any series of Securities shall
accept appointment as provided in this Section 6.12 unless at the time of such
acceptance such successor trustee shall be qualified under Section 310(b) of the
Trust Indenture Act and eligible under the provisions of Section 6.10.

Upon acceptance of appointment by any successor trustee as provided in
this Section 6.12, the Issuer shall give notice thereof (a) if any Unregistered
Securities of a series affected are then Outstanding, to the Holders thereof, by
publication of such notice at least once in an Authorized Newspaper in the
Borough of Manhattan, The City of New York and at least once in an Authorized
Newspaper in London (and, if required by Section 3.9, at least once in an
Authorized Newspaper in Luxembourg), (b) if any Unregistered Securities of a
series affected are then Outstanding, to the Holders thereof who have filed
their names and addresses with the Trustee pursuant to Section 313(c)(2) of the
Trust Indenture Act, by mailing such notice to such Holders at such addresses as
were so furnished to the Trustee (and the Trustee shall make such information
available to the Issuer for such purpose) and (c) to the Holders of Registered
Securities of each series affected, by mailing such notice to such Holders at
their addresses as they shall appear on the registry books. If the acceptance
of appointment is substantially contemporaneous with the resignation, then the
notice called for by the preceding sentence may be combined with the notice
called for by Section 6.11. If the Issuer fails to give such notice within ten
days after acceptance of appointment by the successor trustee, the successor
trustee shall cause such notice to be given at the expense of the Issuer.

SECTION 6.13 MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS OF TRUSTEE. Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder, PROVIDED, that such
corporation shall be qualified under Section 310(b) of the Trust Indenture Act
and eligible under the provisions of Section 6.10, without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.

In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any of the Securities of any series shall have
been authenticated but not delivered, any such successor to the Trustee may
adopt the certificate of authentication of any predecessor trustee and deliver
such Securities so authenticated; and, in case at that time any of the
Securities of any series shall not have been authenticated, any such successor
to the Trustee may authenticate such Securities either in the name of any
predecessor hereunder or in the name of the successor Trustee; and in all such
cases such certificate of authentication shall have the full

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force which under this Indenture or the Securities of such series it is provided
that the certificate of authentication of the Trustee shall have; PROVIDED, that
the right to adopt the certificate of authentication of any predecessor trustee
or to authenticate Securities of any series in the name of any predecessor
trustee shall apply only to its successor or successors by merger, conversion or
consolidation.

SECTION 6.14 PREFERENTIAL COLLECTION OF CLAIMS AGAINST THE ISSUER.
The Trustee shall comply with Section 311(a) of the Trust Indenture Act,
excluding any creditor relationship listed in Section 311(b) of the Trust
Indenture Act. A Trustee who has resigned or been removed shall be subject to
Section 311(a) of the Trust Indenture Act to the extent indicated.

SECTION 6.15 APPOINTMENT OF AUTHENTICATING AGENT. As long as any
Securities of a series remain Outstanding, the Trustee may, by an instrument in
writing, appoint with the approval of the Issuer an authenticating agent (the
"Authenticating Agent") which shall be authorized to act on behalf of the
Trustee to authenticate Securities, including Securities issued upon exchange,
registration of transfer, partial redemption or pursuant to Section 2.9.
Securities of each such series authenticated by such Authenticating Agent shall
be entitled to the benefits of this Indenture and shall be valid and obligatory
for all purposes as if authenticated by the Trustee. Whenever reference is made
in this Indenture to the authentication and delivery of Securities of any series
by the Trustee or to the Trustee's Certificate of Authentication, such reference
shall be deemed to include authentication and delivery on behalf of the Trustee
by an Authenticating Agent for such series and a Certificate of Authentication
executed on behalf of the Trustee by such Authenticating Agent. Such
Authenticating Agent shall at all times be a corporation organized and doing
business under the laws of the United States of America or of any State,
authorized under such laws to exercise corporate trust powers, having a combined
capital and surplus of at least $45,000,000 (determined as provided in Section
6.10 with respect to the Trustee) and subject to supervision or examination by
federal or state authority.

Any corporation into which any Authenticating Agent may be merged or
converted, or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which any Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency business
of any Authenticating Agent, shall continue to be the Authenticating Agent with
respect to all series of Securities for which it served as Authenticating Agent
without the execution or filing of any paper or any further act on the part of
the Trustee or such Authenticating Agent. Any Authenticating Agent may at any
time, and if it shall cease to be eligible shall, resign by giving written
notice of resignation to the Trustee and to the Issuer.

Upon receiving such a notice of resignation or upon such a
termination, or in case at any time any Authenticating Agent shall cease to be
eligible in accordance with the provisions of this Section 6.15 with respect to
one or more series of Securities, the Trustee shall upon receipt of an Issuer
Order appoint a successor Authenticating Agent and the Issuer shall provide
notice

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of such appointment to all Holders of Securities of such series in the manner
and to the extent provided in Section 11.4. Any successor Authenticating Agent
upon acceptance of its appointment hereunder shall become vested with all
rights, powers, duties and responsibilities of its predecessor hereunder, with
like effect as if originally named as Authenticating Agent. The Issuer agrees
to pay to the Authenticating Agent for such series from time to time reasonable
compensation. The Authenticating Agent for the Securities of any series shall
have no responsibility or liability for any action taken by it as such at the
direction of the Trustee.

Sections 6.2, 6.3, 6.4, 6.6 and 7.3 shall be applicable to any
Authenticating Agent.

ARTICLE VII

CONCERNING THE SECURITYHOLDERS

SECTION 7.1 EVIDENCE OF ACTION TAKEN BY SECURITYHOLDERS. Any
request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Indenture to be given or taken by a specified percentage
in principal amount of the Securityholders of any or all series may be embodied
in and evidenced by one or more instruments of substantially similar tenor
signed by such specified percentage of Securityholders in person or by agent
duly appointed in writing; and, except as herein otherwise expressly provided,
such action shall become effective when such instrument or instruments are
delivered to the Trustee. Proof of execution of any instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Indenture
and (subject to Sections 6.1 and 6.2) conclusive in favor of the Trustee and the
Issuer, if made in the manner provided in this Article.

SECTION 7.2 PROOF OF EXECUTION OF INSTRUMENTS AND OF HOLDING OF
SECURITIES. Subject to Sections 6.1 and 6.2, the execution of any instrument by
a Securityholder or his agent or proxy may be proved in accordance with such
reasonable rules and regulations as may be prescribed by the Trustee or in such
manner as shall be satisfactory to the Trustee. The holding of Registered
Securities shall be proved by the Security register or by a certificate of the
registrar thereof.

SECTION 7.3 HOLDERS TO BE TREATED AS OWNERS. The Issuer, the Trustee
and any agent of the Issuer or the Trustee may deem and treat the person in
whose name any Security shall be registered upon the Security register for such
series as the absolute owner of such Security (whether or not such Security
shall be overdue and notwithstanding any notation of ownership or other writing
thereon) for the purpose of receiving payment of or on account of the principal
of and, subject to the provisions of this Indenture, interest on such Security
and for all other purposes; and neither the Issuer nor the Trustee nor any agent
of the Issuer or the Trustee shall be affected by any notice to the contrary.
The Issuer, the Trustee and any agent of the Issuer or the Trustee may treat the
Holder of any Unregistered Security and the Holder of any Coupon as the absolute
owner of such Unregistered Security or Coupon (whether or not such Unregistered

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Security or Coupon shall be overdue) for the purpose of receiving payment
thereof or on account thereof and for all other purposes and neither the Issuer,
the Trustee, nor any agent of the Issuer or the Trustee shall be affected by any
notice to the contrary. All such payments so made to any such person, or upon
his order, shall be valid, and, to the extent of the sum or sums so paid,
effectual to satisfy and discharge the liability for moneys payable upon any
such Unregistered Security or Coupon.

SECTION 7.4 SECURITIES OWNED BY ISSUER DEEMED NOT OUTSTANDING. In
determining whether the Holders of the requisite aggregate principal amount of
Outstanding Securities of any or all series have concurred in any request,
demand, authorization, direction, notice, consent, waiver or other action by
Securityholders under this Indenture, Securities which are owned by the Issuer
or any other obligor on the Securities with respect to which such determination
is being made or by any person directly or indirectly controlling or controlled
by or under direct or indirect common control with the Issuer or any other
obligor on the Securities with respect to which such determination is being made
shall be disregarded and deemed not to be Outstanding for the purpose of any
such determination, except that for the purpose of determining whether the
Trustee shall be protected in relying on any such action only Securities which
the Trustee knows are so owned shall be so disregarded. Securities so owned
which have been pledged in good faith may be regarded as Outstanding if the
pledgee establishes to the satisfaction of the Trustee the pledgee's right so to
act with respect to such Securities and that the pledgee is not the Issuer or
any other obligor upon the Securities or any person directly or indirectly
controlling or controlled by or under direct or indirect common control with the
Issuer or any other obligor on the Securities. In case of a dispute as to such
right, the advice of counsel shall be full protection in respect of any decision
made by the Trustee in accordance with such advice. Upon request of the
Trustee, the Issuer shall furnish to the Trustee promptly an Officer's
Certificate listing and identifying all Securities, if any, known by the Issuer
to be owned or held by or for the account of any of the above-described persons;
and, subject to Sections 6.1 and 6.2, the Trustee shall be entitled to accept
such Officer's Certificate as conclusive evidence of the facts therein set forth
and of the fact that all Securities not listed therein are Outstanding for the
purpose of any such determination.

SECTION 7.5 RIGHT OF REVOCATION OF ACTION TAKEN. At any time prior
to (but not after) the evidencing to the Trustee, as provided in Section 7.1, of
the taking of any action by the Holders of the percentage in aggregate principal
amount of the Securities of any or all series, as the case may be, specified in
this Indenture in connection with such action, any Holder of a Security the
serial number of which is shown by the evidence to be included among the serial
numbers of the Securities the Holders of which have consented to such action
may, by filing written notice at the Corporate Trust Office and upon proof of
holding as provided in this Article, revoke such action so far as concerns such
Security. Except as aforesaid, any such action taken by the Holder of any
Security shall be conclusive and binding upon such Holder and upon all future
Holders and owners of such Security and of any Securities issued in exchange or
substitution therefor or on registration of transfer thereof, irrespective of
whether or not any notation in regard thereto is made upon any such Security.
Any action taken by the Holders of

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the percentage in aggregate principal amount of the Securities of any or all
series, as the case may be, specified in this Indenture in connection with such
action shall be conclusively binding upon the Issuer, the Trustee and the
Holders of all the Securities affected by such action.

ARTICLE VIII

SUPPLEMENTAL INDENTURES

SECTION 8.1 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF
SECURITYHOLDERS. The Issuer, when authorized by a resolution of its Board of
Directors (which resolution may provide general terms or parameters for such
action and may provide that the specific terms of such action may be determined
in accordance with or pursuant to an Issuer Order), and the Trustee may from
time to time and at any time enter into an indenture or indentures supplemental
hereto for one or more of the following purposes:

(a) to convey, transfer, assign, mortgage or pledge to the Trustee as
security for the Securities of one or more series any property or assets;

(b) to evidence the succession of another corporation to the Issuer,
or successive successions, and the assumption by the successor corporation
of the covenants, agreements and obligations of the Issuer pursuant to
Article IX;

(c) to add to the covenants of the Issuer such further covenants,
restrictions, conditions or provisions as the Issuer and the Trustee shall
consider to be for the protection of the Holders of Securities or Coupons,
and to make the occurrence, or the occurrence and continuance, of a default
in any such additional covenants, restrictions, conditions or provisions an
Event of Default permitting the enforcement of all or any of the several
remedies provided in this Indenture as herein set forth; PROVIDED, that in
respect of any such additional covenant, restriction, condition or
provision such supplemental indenture may provide for a particular period
of grace after default (which period may be shorter or longer than that
allowed in the case of other defaults) or may provide for an immediate
enforcement upon such an Event of Default or may limit the remedies
available to the Trustee upon such an Event of Default or may limit the
right of the Holders of a majority in aggregate principal amount of the
Securities of such series to waive such an Event of Default;

(d) to cure any ambiguity or to correct or supplement any provision
contained herein or in any supplemental indenture which may be defective or
inconsistent with any other provision contained herein or in any
supplemental indenture, or to make any other provisions as the Issuer may
deem necessary or desirable, PROVIDED, that no such action shall adversely
affect the interests of the Holders of the Securities or Coupons;

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(e) to establish the forms or terms of Securities of any series or of
the Coupons appertaining to such Securities as permitted by Sections 2.1
and 2.3; and

(f) to evidence and provide for the acceptance of appointment
hereunder by a successor trustee with respect to the Securities of one or
more series and to add to or change any of the provisions of this Indenture
as shall be necessary to provide for or facilitate the administration of
the trusts hereunder by more than one trustee, pursuant to the requirements
of Section 6.12.

The Trustee is hereby authorized to join with the Issuer in the
execution of any such supplemental indenture, to make any further appropriate
agreements and stipulations which may be therein contained and to accept the
conveyance, transfer, assignment, mortgage or pledge of any property thereunder,
but the Trustee shall not be obligated to enter into any such supplemental
indenture which affects the Trustee's own rights, duties or immunities under
this Indenture or otherwise.

Any supplemental indenture authorized by the provisions of this
Section may be executed without the consent of the Holders of any of the
Securities at the time outstanding, notwithstanding any of the provisions of
Section 8.2.

SECTION 8.2 SUPPLEMENTAL INDENTURES WITH CONSENT OF
SECURITYHOLDERS.

(A) Except as set forth in paragraph (C) below, with the consent
(evidenced as provided in Article VII) of the Holders of not less than a
majority in aggregate principal amount of the Securities at the time Outstanding
of all series of Senior Securities affected by such supplemental indenture
(voting as one class), the Issuer, when authorized by a resolution of its Board
of Directors (which resolution may provide general terms or parameters for such
action and may provide that the specific terms of such action may be determined
in accordance with or pursuant to an Issuer Order), and the Trustee may, from
time to time and at any time, enter into an indenture or indentures supplemental
hereto (which shall conform to the provisions of the Trust Indenture Act as in
force and effect at the date of execution thereof) for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Indenture or of any supplemental indenture or of modifying in any manner
the rights of the Holders of the Securities of each such series or of the
Coupons appertaining to such Securities.

(B) Except as set forth in paragraph (C) below, with the consent
(evidenced as provided in Article VII) of the Holders of not less than a
majority in aggregate principal amount of the Securities at the time Outstanding
of all series of Subordinated Securities affected by such supplemental indenture
(voting as one class), the Issuer, when authorized by a resolution of its Board
of Directors (which resolution may provide general terms or parameters for such
action and may provide that the specific terms of such action may be determined
in accordance with or pursuant to an Issuer Order), and the Trustee may, from
time to time and at any time, enter into

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an indenture or indentures supplemental hereto (which shall conform to the
provisions of the Trust Indenture Act as in force and effect at the date of
execution thereof) for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of any
supplemental indenture or of modifying in any manner the rights of the Holders
of the Securities of each such series or of the Coupons appertaining to such
Securities.

(C) No such supplemental indenture shall (i) extend the final
maturity of any Security, or reduce the principal amount thereof, or reduce the
rate or extend the time of payment of interest thereon, or reduce any amount
payable on redemption thereof, or make the principal thereof (including any
amount in respect of original issue discount), or interest thereon payable in
any coin or currency other than that provided in the Securities and Coupons or
in accordance with the terms thereof, or reduce the amount of the principal of
an Original Issue Discount Security that would be due and payable upon an
acceleration of the maturity thereof pursuant to Section 5.1 or the amount
thereof provable in bankruptcy pursuant to Section 5.2, or alter the provisions
of Section 11.11 or 11.12 or impair or affect the right of any Securityholder to
institute suit for the payment thereof when due or, if the Securities provide
therefor, any right of repayment at the option of the Securityholder, in each
case without the consent of the Holder of each Security so affected, or (ii)
reduce the aforesaid percentage of Securities of any series, the consent of the
Holders of which is required for any such supplemental indenture, without the
consent of the Holders of each Security so affected.

(D) A supplemental indenture which changes or eliminates any covenant
or other provision of this Indenture which has expressly been included solely
for the benefit of one or more particular series of Securities, or which
modifies the rights of Holders of Securities of such series, or of Coupons
appertaining to such Securities, with respect to such covenant or provision,
shall be deemed not to affect the rights under this Indenture of the Holders of
Securities of any other series or of the Coupons appertaining to such
Securities.

Upon the request of the Issuer, accompanied by a copy of a resolution
of the Board of Directors (which resolution may provide general terms or
parameters for such action and may provide that the specific terms of such
action may be determined in accordance with or pursuant to an Issuer Order)
certified by the secretary or an assistant secretary of the Issuer authorizing
the execution of any such supplemental indenture, and upon the filing with the
Trustee of evidence of the consent of the Holders of the Securities as aforesaid
and other documents, if any, required by Section 7.1, the Trustee shall join
with the Issuer in the execution of such supplemental indenture unless such
supplemental indenture affects the Trustee's own rights, duties or immunities
under this Indenture or otherwise, in which case the Trustee may in its
discretion, but shall not be obligated to, enter into such supplemental
indenture.

It shall not be necessary for the consent of the Securityholders under
this Section to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.

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Promptly after the execution by the Issuer and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the Trustee
shall give notice thereof (i) to the Holders of then Outstanding Registered
Securities of each series affected thereby, by mailing a notice thereof by
first-class mail to such Holders at their addresses as they shall appear on the
Security register, (ii) if any Unregistered Securities of a series affected
thereby are then Outstanding, to the Holders thereof who have filed their names
and addresses with the Trustee pursuant to Section 313(c)(2) of the Trust
Indenture Act, by mailing a notice thereof by first-class mail to such Holders
at such addresses as were so furnished to the Trustee and (iii) if any
Unregistered Securities of a series affected thereby are then Outstanding, to
all Holders thereof, by publication of a notice thereof at least once in an
Authorized Newspaper in the Borough of Manhattan, The City of New York and at
least once in an Authorized Newspaper in London (and, if required by Section
3.9, at least once in an Authorized Newspaper in Luxembourg), and in each case
such notice shall set forth in general terms the substance of such supplemental
indenture. Any failure of the Issuer to give such notice, or any defect
therein, shall not, however, in any way impair or affect the validity of any
such supplemental indenture.

SECTION 8.3 EFFECT OF SUPPLEMENTAL INDENTURE. Upon the execution of
any supplemental indenture pursuant to the provisions hereof, this Indenture
shall be and be deemed to be modified and amended in accordance therewith and
the respective rights, limitations of rights, obligations, duties and immunities
under this Indenture of the Trustee, the Issuer and the Holders of Securities of
each series affected thereby shall thereafter be determined, exercised and
enforced hereunder subject in all respects to such modifications and amendments,
and all the terms and conditions of any such supplemental indenture shall be and
be deemed to be part of the terms and conditions of this Indenture for any and
all purposes.

SECTION 8.4 DOCUMENTS TO BE GIVEN TO TRUSTEE. The Trustee, subject
to the provisions of Sections 6.1 and 6.2, may receive an Officer's Certificate
and an Opinion of Counsel as conclusive evidence that any supplemental indenture
executed pursuant to this Article 8 complies with the applicable provisions of
this Indenture.

SECTION 8.5 NOTATION ON SECURITIES IN RESPECT OF SUPPLEMENTAL
INDENTURES. Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to the provisions of this
Article may bear a notation in form approved by the Trustee for such series as
to any matter provided for by such supplemental indenture or as to any action
taken by Securityholders. If the Issuer or the Trustee shall so determine, new
Securities of any series so modified as to conform, in the opinion of the
Trustee and the Board of Directors, to any modification of this Indenture
contained in any such supplemental indenture may be prepared by the Issuer,
authenticated by the Trustee and delivered in exchange for the Securities of
such series then Outstanding.

ARTICLE IX

CONSOLIDATION, MERGER, SALE OR CONVEYANCE

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SECTION 9.1 ISSUER MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS. The
Issuer shall not consolidate with or merge into any other Person or transfer or
lease its properties and assets substantially as an entirety to any Person, and
the Issuer shall not permit any other Person to consolidate with or merge into
the Issuer, unless:

(a) either the Issuer shall be the continuing corporation, or the
successor corporation (if other than the Issuer) formed by such
consolidation or into which the Issuer is merged or to which the properties
and assets of the Issuer substantially as an entirety are transferred or
leased shall be a corporation organized and existing under the laws of the
United States of America, any State thereof or the District of Columbia and
shall expressly assume, by an indenture supplemental hereto, executed and
delivered to the Trustee, in form satisfactory to the Trustee, all the
obligations of the Issuer under the Securities and this Indenture; and

(b) immediately after giving effect to such transaction and treating
any indebtedness which becomes an obligation of the Issuer or a Subsidiary
as a result of such transaction as having been incurred by the Issuer or
such Subsidiary at the time of such transaction, no Event of Default, and
no event which, after notice or lapse of time or both, would become an
Event of Default, shall have happened and be continuing.

SECTION 9.2 SUCCESSOR CORPORATION SUBSTITUTED. The successor
corporation formed by such consolidation or into which the Issuer is merged or
to which such transfer or lease is made shall succeed to and be substituted for,
and may exercise every right and power of, the Issuer under this Indenture with
the same effect as if such successor corporation had been named as the Issuer
herein, and thereafter (except in the case of a lease to another Person) the
predecessor corporation shall be relieved of all obligations and covenants under
the Indenture and the Securities and, in the event of such conveyance or
transfer, any such predecessor corporation may be dissolved and liquidated.

SECTION 9.3 OPINION OF COUNSEL TO BE GIVEN TRUSTEE. The Trustee,
subject to the provisions of Sections 6.1 and 6.2, may receive an Opinion of
Counsel as conclusive evidence that any such consolidation, merger, sale or
conveyance, and any such assumption, complies with the provisions of this
Article IX.

ARTICLE X

SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS

SECTION 10.1 SATISFACTION AND DISCHARGE OF INDENTURE.

(A) If at any time (i) the Issuer shall have paid or caused to be
paid the principal of and interest on all the Securities of any series
Outstanding hereunder and all unmatured

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Coupons appertaining thereto (other than Securities of such series and Coupons
appertaining thereto which have been destroyed, lost or stolen and which have
been replaced or paid as provided in Section 2.9) as and when the same shall
have become due and payable, or (ii) the Issuer shall have delivered to the
Trustee for cancellation all Securities of any series theretofore authenticated
and all unmatured Coupons appertaining thereto (other than any Securities of
such series and Coupons appertaining thereto which shall have been destroyed,
lost or stolen and which shall have been replaced or paid as provided in Section
2.9) or (iii) in the case of any series of Securities where the exact amount
(including the currency of payment) of principal of and interest due on which
can be determined at the time of making the deposit referred to in clause (b)
below, (a) all the Securities of such series and all unmatured Coupons
appertaining thereto not theretofore delivered to the Trustee for cancellation
shall have become due and payable, or are by their terms to become due and
payable within one year or are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of redemption,
and (b) the Issuer shall have irrevocably deposited or caused to be deposited
with the Trustee as trust funds in trust the entire amount in (i) cash (other
than moneys repaid by the Trustee or any paying agent to the Issuer in
accordance with Section 10.4), (ii) in the case of any series of Securities the
payments on which may only be made in Dollars, direct obligations of the United
States of America, backed by its full faith and credit ("U.S. Government
Obligations"), maturing as to principal and interest at such times and in such
amounts as will insure the availability of cash sufficient to pay at such
maturity or upon such redemption, as the case may be, or (iii) a combination
thereof, sufficient, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, to pay (x) the principal and interest on all
Securities of such series and Coupons appertaining thereto on each date that
such principal or interest is due and payable and (y) any mandatory sinking fund
payments on the dates on which such payments are due and payable in accordance
with the terms of the Indenture and the Securities of such series; and if, in
any such case, the Issuer shall also pay or cause to be paid all other sums
payable hereunder by the Issuer, then this Indenture shall cease to be of
further effect (except as to (i) rights of registration of transfer and exchange
of Securities of such Series and of Coupons appertaining thereto pursuant to
Section 2.8 and the Issuer's right of optional redemption, if any, (ii)
substitution of mutilated, defaced, destroyed, lost or stolen Securities or
Coupons, (iii) rights of holders of Securities and Coupons appertaining thereto
pursuant to Section 2.8 to receive payments of principal thereof and interest
thereon, upon the original stated due dates therefor (but not upon
acceleration), and remaining rights of the Holders to receive mandatory sinking
fund payments, if any, (iv) any optional redemption rights of such series of
Securities to the extent to be exercised to make such call for redemption within
one year, (v) the rights, obligations, duties and immunities of the Trustee
hereunder, including those under Section 6.6, (vi) the rights of the Holders of
Securities of such series and Coupons appertaining thereto as beneficiaries
hereof with respect to the property so deposited with the Trustee payable to all
or any of them, and (vii) the obligations of the Issuer under Section 3.2) and
the Trustee, on demand of the Issuer accompanied by an Officer's Certificate and
an Opinion of Counsel and at the cost and expense of the Issuer, shall execute
proper instruments acknowledging such satisfaction of and discharging this
Indenture; PROVIDED, that the rights of Holders of the Securities and Coupons to
receive amounts in respect of principal of and interest

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on the Securities and Coupons held by them shall not be delayed longer than
required by then-applicable mandatory rules or policies of any securities
exchange upon which the Securities are listed. The Issuer agrees to reimburse
the Trustee for any costs or expenses thereafter reasonably and properly
incurred and to compensate the Trustee for any services thereafter reasonably
and properly rendered by the Trustee in connection with this Indenture or the
Securities of such series.

(B) The following provisions shall apply to the Securities of each
series unless specifically otherwise provided in a Board Resolution, Officer's
Certificate or indenture supplemental hereto provided pursuant to Section 2.3.
In addition to discharge of the Indenture pursuant to the next preceding
paragraph, in the case of any series of Securities the exact amounts (including
the currency of payment) of principal of and interest due on which can be
determined at the time of making the deposit referred to in clause (a) below,
the Issuer shall be deemed to have paid and discharged the entire indebtedness
on all the Securities of such a series and the Coupons appertaining thereto on
the date of the deposit referred to in subparagraph (a) below, and the
provisions of this Indenture with respect to the Securities of such series and
Coupons appertaining thereto shall no longer be in effect (except as to (i)
rights of registration of transfer and exchange of Securities of such series and
of Coupons appertaining thereto pursuant to Section 2.8 and the Issuer's right
of optional redemption, if any, (ii) substitution of mutilated, defaced,
destroyed, lost or stolen Securities or Coupons, (iii) rights of Holders of
Securities and Coupons appertaining thereto to receive payments of principal
thereof and interest thereon, upon the original stated due dates therefor (but
not upon acceleration), and remaining rights of the Holders to receive mandatory
sinking fund payments, if any, (iv) any optional redemption rights of such
series of Securities to the extent to be exercised to make such call for
redemption within one year, (v) the rights, obligations, duties and immunities
of the Trustee hereunder, (vi) the rights of the Holders of Securities of such
series and Coupons appertaining thereto as beneficiaries hereof with respect to
the property so deposited with the Trustee payable to all or any of them and
(vii) the obligations of the Issuer under Section 3.2) and the Trustee, at the
expense of the Issuer, shall at the Issuer's request, execute proper instruments
acknowledging the same, if

(a) with reference to this provision the Issuer has irrevocably
deposited or caused to be irrevocably deposited with the Trustee as trust
funds in trust, specifically pledged as security for, and dedicated solely
to, the benefit of the Holders of the Securities of such series and Coupons
appertaining thereto (i) cash in an amount, or (ii) in the case of any
series of Securities the payments on which may only be made in Dollars,
U.S. Government Obligations, maturing as to principal and interest at such
times and in such amounts as will insure the availability of cash or (iii)
a combination thereof, sufficient, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay (A) the principal
and interest on all Securities of such series and Coupons appertaining
thereto on each date that such principal or interest is due and payable and
(B) any mandatory sinking fund payments on the dates on which such payments
are due and payable in accordance with the terms of the Indenture and the
Securities of such series;

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(b) such deposit will not result in a breach or violation of, or
constitute a default under, any agreement or instrument to which the Issuer
is a party or by which it is bound;

(c) the Issuer has delivered to the Trustee an opinion of counsel
from a nationally recognized law firm based on the fact that (x) the Issuer
has received from, or there has been published by, the IRS a ruling or (y)
since the date hereof, there has been a change in the applicable United
States federal income tax law, in either case to the effect that, and such
opinion shall confirm that, the Holders of the Securities of such series
and Coupons appertaining thereto will not recognize income, gain or loss
for United States federal income tax purposes as a result of such deposit,
defeasance and discharge and will be subject to United States federal
income tax on the same amount and in the same manner and at the same times,
as would have been the case if such deposit, defeasance and discharge had
not occurred;

(d) the Issuer has delivered to the Trustee an Opinion of Counsel to
the effect that after the 91st day following the deposit, the trust funds
will not be subject to avoidance as a preferential transfer under Section
547(b) of the United States Bankruptcy Code (except with respect to any
Holder that is an "insider" of the Issuer within the meaning of the United
States Bankruptcy Code); and

(e) the Issuer has delivered to the Trustee an Officer's Certificate
and an Opinion of Counsel, each stating that all conditions precedent
provided for relating to the defeasance contemplated by this provision have
been complied with.

(C) The Issuer shall be released from its obligations under Sections
3.6, 3.7 and 9.1 and unless otherwise provided for in the Board Resolution,
Officer's Certificate or Indenture supplemental hereto establishing such series
of Securities, from all covenants and other obligations referred to in Section
2.3(19) or 2.3(21) with respect to such series of Securities, and any Coupons
appertaining thereto, outstanding on and after the date the conditions set forth
below are satisfied (hereinafter, "covenant defeasance"). For this purpose,
such covenant defeasance means that, with respect to the Outstanding Securities
of any series, the Issuer may omit to comply with and shall have no liability in
respect of any term, condition or limitation set forth in such Section, whether
directly or indirectly by reason of any reference elsewhere herein to such
Section or by reason of any reference in such Section to any other provision
herein or in any other document and such omission to comply shall not constitute
an Event of Default under Section 5.1, but the remainder of this Indenture and
such Securities and Coupons shall be unaffected thereby. The following shall be
the conditions to application of this subsection C of this Section 10.1:

(a) The Issuer has irrevocably deposited or caused to be deposited
with the Trustee as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and dedicated
solely to, the benefit of the holders of the Securities of such series and
coupons appertaining thereto, (i) cash in an amount, or

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(ii) in the case of any series of Securities the payments on which may only
be made in Dollars, U.S. Government Obligations maturing as to principal
and interest at such times and in such amounts as will insure the
availability of cash or (iii) a combination thereof, sufficient, in the
opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, to
pay (A) the principal and interest on all Securities of such series and
Coupons appertaining thereof and (B) any mandatory sinking fund payments on
the day on which such payments are due and payable in accordance with the
terms of the Indenture and the Securities of such series;

(b) No Event of Default or event which with notice or lapse of time
or both would become an Event of Default with respect to the Securities
shall have occurred and be continuing on the date of such deposit;

(c) Such covenant defeasance shall not cause the Trustee to have a
conflicting interest as defined in Section 6.9 and for purposes of the
Trust Indenture Act with respect to any securities of the Issuer;

(d) Such covenant defeasance shall not result in a breach or
violation of, or constitute a default under any agreement or instrument to
which the Issuer is a party or by which it is bound;

(e) Such covenant defeasance shall not cause any Securities then
listed on any registered national securities exchange under the Exchange
Act to be delisted;

(f) The Issuer shall have delivered to the Trustee an Officer's
Certificate and an opinion of counsel from a nationally recognized law firm
to the effect that the Holders of the Securities of such series and Coupons
appertaining thereto will not recognize income, gain or loss for United
States federal income tax purposes as a result of such covenant defeasance
and will be subject to United States federal income tax on the same
amounts, in the same manner and at the same times as would have been the
case if such covenant defeasance had not occurred;

(g) The Issuer has delivered to the Trustee an Opinion of Counsel to
the effect that after the 91st day following the deposit, the trust funds
will not be subject to avoidance as a preferential transfer under Section
547(b) of the United States Bankruptcy Code (except with respect to any
Holder that is an "insider" of the Issuer within the meaning of the United
States Bankruptcy Code); and

(h) The Issuer shall have delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to the covenant defeasance contemplated by
this provision have been complied with.

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SECTION 10.2 APPLICATION BY TRUSTEE OF FUNDS DEPOSITED FOR PAYMENT OF
SECURITIES. Subject to Section 10.4, all moneys deposited with the Trustee
(or other trustee) pursuant to Section 10.1 shall be held in trust and applied
by it to the payment, either directly or through any paying agent (including the
Issuer acting as its own paying agent), to the Holders of the particular
Securities of such series and of Coupons appertaining thereto for the payment or
redemption of which such moneys have been deposited with the Trustee, of all
sums due and to become due thereon for principal and interest; but such money
need not be segregated from other funds except to the extent required by law.

SECTION 10.3 REPAYMENT OF MONEYS HELD BY PAYING AGENT. In
connection with the satisfaction and discharge of this Indenture with respect to
Securities of any series, all moneys then held by any paying agent under the
provisions of this Indenture with respect to such series of Securities shall,
upon demand of the Issuer, be repaid to it or paid to the Trustee and thereupon
such paying agent shall be released from all further liability with respect to
such moneys.

SECTION 10.4 RETURN OF MONEYS HELD BY TRUSTEE AND PAYING AGENT
UNCLAIMED FOR TWO YEARS. Any moneys deposited with or paid to the Trustee or
any paying agent for the payment of the principal of or interest on any Security
of any series and of any Coupons attached thereto and not applied but remaining
unclaimed for two years after the date upon which such principal or interest
shall have become due and payable, shall, upon the written request of the Issuer
and unless otherwise required by mandatory provisions of applicable escheat or
abandoned or unclaimed property law, be repaid to the Issuer by the Trustee for
such series or such paying agent, and the Holder of the Securities of such
series and of any Coupons appertaining thereto shall, unless otherwise required
by mandatory provisions of applicable escheat or abandoned or unclaimed property
laws, thereafter look only to the Issuer for any payment which such Holder may
be entitled to collect, and all liability of the Trustee or any paying agent
with respect to such moneys shall thereupon cease; PROVIDED, that the Trustee or
such paying agent, before being required to make any such repayment with respect
to moneys deposited with it for any payment (a) in respect of Registered
Securities of any series, shall at the expense of the Issuer, mail by
first-class mail to Holders of such Securities at their addresses as they shall
appear on the Security register, and (b) in respect of Unregistered Securities
of any series, shall at the expense of the Issuer cause to the published once,
in an Authorized Newspaper in the Borough of Manhattan, The City of New York and
once in an Authorized Newspaper in London (and, if required by Section 3.9, once
in an Authorized Newspaper in Luxembourg), notice, that such moneys remain and
that, after a date specified therein, which shall not be less than thirty days
from the date of such mailing or publication, any unclaimed balance of such
money then remaining will be repaid to the Issuer.

SECTION 10.5 INDEMNITY FOR U.S. GOVERNMENT OF OBLIGATIONS. The
Issuer shall pay and indemnify the Trustee against any tax, fee or other charge
imposed on or assessed against the U.S. Government Obligations deposited
pursuant to Section 10.1 or the principal or interest received in respect of
such obligations.

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ARTICLE XI

MISCELLANEOUS PROVISIONS

SECTION 11.1 INCORPORATORS, SHAREHOLDERS, OFFICERS AND DIRECTORS OF
ISSUER EXEMPT FROM INDIVIDUAL LIABILITY. No recourse under or upon any
obligation, covenant or agreement contained in this Indenture, or in any
Security, or because of any indebtedness evidenced thereby, shall be had against
any incorporator, as such, or against any past, present or future shareholder,
officer or director, as such, of the Issuer or of any successor, either directly
or through the Issuer or any successor, under any rule of law, statute or
constitutional provision or by the enforcement of any assessment or by any legal
or equitable proceeding or otherwise, all such liability being expressly waived
and released by the acceptance of the Securities and the Coupons, if any,
appertaining thereto by the Holders thereof and as part of the consideration for
the issue of the Securities and the Coupons appertaining thereto.

SECTION 11.2 PROVISIONS OF INDENTURE FOR THE SOLE BENEFIT OF PARTIES
AND HOLDERS OF SECURITIES AND COUPONS. Nothing in this Indenture, in the
Securities or in the Coupons appertaining thereto, expressed or implied, shall
give or be construed to give to any person, firm or corporation, other than the
parties thereto and their successors and the Holders of the Securities or
Coupons, if any, any legal or equitable right, remedy or claim under this
Indenture or under any covenant or provision herein contained, all such
covenants and provisions being for the sole benefit of the parties hereto and
their successors and of the Holders of the Securities or Coupons, if any.

SECTION 11.3 SUCCESSORS AND ASSIGNS OF ISSUER BOUND BY
INDENTURE. All the covenants, stipulations, promises and agreements in this
Indenture contained by or in behalf of the Issuer shall bind its successors and
assigns, whether so expressed or not.

SECTION 11.4 NOTICES AND DEMANDS ON ISSUER, TRUSTEE AND HOLDERS OF
SECURITIES AND COUPONS. Any notice or demand which by any provision of this
Indenture is required or permitted to be given or served by the Trustee or by
the Holders of Securities or Coupons, if any, to or on the Issuer may be
given or served by being deposited postage prepaid, first-class mail (except
as otherwise specifically provided herein) addressed (until another address
of the Issuer is filed by the Issuer with the Trustee) to UnionBanCal
Corporation, 400 California Street, San Francisco, California 94104,
Attention: Secretary. Any notice, direction, request or demand by the
Issuer or any Holder of Securities or Coupons, if any, to or upon the Trustee
shall be deemed to have been sufficiently given or served by being deposited
postage prepaid, first-class mail (except as otherwise specifically provided
herein) addressed (until another address of the Trustee is filed by the
Trustee with the Issuer) to [ ], Attention:[ ].

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Where this Indenture provides for notice to Holders of Registered
Securities, such notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and mailed, first-class mail, postage prepaid,
to each Holder entitled thereto, at his last address as it appears in the
Security register.

Where this Indenture provides for notice to holders of Unregistered
Securities, such notice shall be sufficiently given (unless otherwise expressly
provided herein) by giving notice to such Holders (a) by publication of such
notice at least once in an Authorized Newspaper in the Borough of Manhattan, The
City of New York, and at least once in an Authorized Newspaper in London (and,
if required by Section 3.9, once in an Authorized Newspaper in Luxembourg), and
(ii) by mailing such notice to the Holders of Unregistered Securities who have
filed their names and addresses with the Trustee pursuant to Section 313(c)(2)
of the Trust Indenture Act at such addresses as were so furnished to the
Trustee.

In any case where notice to such Holders is given by mail, neither the
failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders. Where this Indenture provides for notice in any manner, such
notice may be waived in writing by the person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Holders shall be filed with the Trustee, but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.

In case, by reason of the suspension of or irregularities in regular
mail service, it shall be impracticable to mail notice to the Issuer when such
notice is required to the given pursuant to any provision of this Indenture,
then any manner of giving such notice as shall be reasonably satisfactory to the
Trustee shall be deemed to be a sufficient giving of such notice.

SECTION 11.5 OFFICER'S CERTIFICATES AND OPINIONS OF COUNSEL;
STATEMENTS TO BE CONTAINED THEREIN. Upon any application or demand by the
Issuer to the Trustee to take any action under any of the provisions of this
Indenture, the Issuer shall furnish to the Trustee an Officer's Certificate
stating that all conditions precedent provided for in this Indenture relating to
the proposed action have been complied with and an Opinion of Counsel stating
that in the opinion of such counsel all such conditions precedent have been
complied with, except that in the case of any such application or demand as to
which the furnishing of such documents is specifically required by any provision
of this Indenture relating to such particular application or demand, no
additional certificate or opinion need be furnished.

Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or covenant
provided for in this Indenture shall include (a) a statement that the person
making such certificate or opinion has read such covenant or condition, (b) a
brief statement as to the nature and scope of the examination or investigation
upon which the statements or opinions contained in such certificate or opinion
are

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based, (c) a statement that, in the opinion of such person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with and (d) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.

Any certificate, statement or opinion of an officer of the Issuer may
be based, insofar as it relates to legal matters, upon a certificate or opinion
of or representations by counsel, unless such officer knows that the certificate
or opinion or representations with respect to the matters upon which his
certificate, statement or opinion may be based as aforesaid are erroneous, or in
the exercise of reasonable care should know that the same are erroneous. Any
certificate, statement or opinion of counsel may be based, insofar as it relates
to factual matters or information with respect to which is in the possession of
the Issuer, upon the certificate, statement or opinion of or representations by
an officer or officers of the Issuer, unless such counsel knows that the
certificate, statement or opinion or representations with respect to the matters
upon which his certificate, statement or opinion may be based as aforesaid are
erroneous, or in the exercise of reasonable care should know that the same are
erroneous.

Any certificate, statement or opinion of an officer of the Issuer or
of counsel may be based, insofar as it relates to accounting matters, upon a
certificate or opinion of or representations by an accountant or firm of
accountants in the employ of the Issuer, unless such officer or counsel, as the
case may be, knows that the certificate or opinion of or representations with
respect to the accounting matters upon which his certificate, statement or
opinion may be based as aforesaid are erroneous, or in the exercise of
reasonable care should know that the same are erroneous.

Any certificate or opinion of any independent firm of public
accountants filed with and directed to the Trustee shall contain a statement
that such firm is independent.

SECTION 11.6 PAYMENTS DUE ON SATURDAYS, SUNDAYS AND HOLIDAYS. If the
date of maturity of interest on or principal of the Securities of any series or
any Coupons appertaining thereto or the date fixed for redemption or repayment
of any such Security or Coupon shall not be a Business Day, then payment of
interest or principal need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made on the date of
maturity or the date fixed for redemption, and no interest shall accrue for the
period after such date.

SECTION 11.7 CONFLICT OF ANY PROVISION OF INDENTURE WITH TRUST
INDENTURE ACT. If and to the extent that any provision of this Indenture
limits, qualifies or conflicts with duties imposed by, or with another provision
(an "incorporated provision") included in this Indenture by operation of
Sections 310 to 318, inclusive, of the Trust Indenture Act, such imposed duties
or incorporated provision shall control.

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SECTION 11.8 NEW YORK LAW TO GOVERN. THIS INDENTURE AND EACH
SECURITY AND COUPON SHALL BE DEEMED TO BE A CONTRACT UNDER THE LAWS OF THE STATE
OF NEW YORK, AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS
OF SUCH STATE INCLUDING, WITHOUT LIMITATION, SECTION 5-140 OF THE NEW YORK
GENERAL OBLIGATIONS LAW.

SECTION 11.9 COUNTERPARTS. This Indenture may be executed in any
number of counterparts, each of which shall be an original; but such
counterparts shall together constitute but one and the same instrument.

SECTION 11.10 EFFECT OF HEADINGS. The Article and Section headings
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.

SECTION 11.11 SECURITIES IN A COMPOSITE CURRENCY, CURRENCY UNIT,
FOREIGN CURRENCY OR IN ECU. Unless otherwise specified in an Officer's
Certificate delivered pursuant to Section 2.3 of this Indenture with respect to
a particular series of Securities, whenever for purposes of this Indenture any
action may be taken by the Holders of a specified percentage in aggregate
principal amount of Securities of all series or all series affected by a
particular action at the time Outstanding and, at such time, there are
Outstanding Securities of any series which are denominated in a coin, currency
or currencies other than Dollars (including, but not limited to, any composite
currency, currency units, Foreign Currency or ECUs), then the principal amount
of Securities of such series which shall be deemed to be Outstanding for the
purpose of taking such action shall be that amount of Dollars that could be
obtained for such amount at the Market Exchange Rate. For purposes of this
Section 11.11, Market Exchange Rate shall mean the noon Dollar buying rate in
The City of New York for cable transfers of such currency or currencies as
published by the Federal Reserve Bank of New York as of the most recent
available date; PROVIDED THAT, in the case of ECUs, Market Exchange Rate shall
mean the rate of exchange determined by the Commission of the European
Communities (or any successor thereto) as published in the Official Journal of
the European Communities (such publication or any successor publication, the
"Journal") as of the most recent available date. If such Market Exchange Rate
is not so available for any reason with respect to such currency, the Trustee
shall use, in its sole discretion and without liability on its part, such
quotation of the Federal Reserve Bank of New York or, in the case of ECUs, the
rate of exchange as published in the Journal, as of the most recent available
date, or quotations or, in the case of ECUs, rates of exchange from one or more
major banks in The City of New York or in the country of issue of the currency
in question, which for purposes of the ECU shall be Brussels, Belgium, or such
other quotations or, in the case of ECU, rates of exchange as the Trustee shall
deem appropriate. The provisions of this paragraph shall apply in determining
the equivalent principal amount in respect of Securities of a series denominated
in a currency other than Dollars in connection with any action taken by Holders
of Securities pursuant to the terms of this Indenture.

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All decisions and determinations of the Trustee regarding the Market
Exchange Rate or any alternative determination provided for in the preceding
paragraph shall be in its sole discretion and shall, in the absence of manifest
error, be conclusive to the extent permitted by law for all purposes and
irrevocably binding upon the Issuer and all Holders.

SECTION 11.12 JUDGMENT CURRENCY. The Issuer agrees, to the fullest
extent that it may effectively do so under applicable law, that (a) if for the
purpose of obtaining judgment in any court it is necessary to convert the sum
due in respect of the principal of or interest on the Securities of any series
(the "Required Currency") into a currency in which a judgment will be rendered
(the "Judgment Currency"), the rate of exchange used shall be the rate at which
in accordance with normal banking procedures the Trustee could purchase in The
City of New York the Required Currency with the Judgment Currency on the day on
which final unappealable judgment is entered, unless such day is not a New York
Banking Day, then, to the extent permitted by applicable law, the rate of
exchange used shall be the rate at which in accordance with normal banking
procedures the Trustee could purchase in The City of New York the Required
Currency with the Judgment Currency on the New York Banking Day preceding the
day on which final unappealable judgment is entered and (b) its obligations
under this Indenture to make payments in the Required Currency (i) shall not be
discharged or satisfied by any tender, or any recovery pursuant to any judgment
(whether or not entered in accordance with subsection (a)), in any currency
other than the Required Currency, except to the extent that such tender or
recovery shall result in the actual receipt, by the payee, of the full amount of
the Required Currency expressed to be payable in respect of such payments, (ii)
shall be enforceable as an alternative or additional cause of action for the
purpose of recovering in the Required Currency the amount, if any, by which such
actual receipt shall fall short of the full amount of the Required Currency so
expressed to be payable and (iii) shall not be affected by judgment being
obtained for any other sum due under this Indenture. For purposes of the
foregoing, "New York Banking Day" means any day except a Saturday, Sunday or a
legal holiday in The City of New York or a day on which banking institutions in
The City of New York are authorized or required by law or executive order to
close.

ARTICLE XII

REDEMPTION OF SECURITIES AND SINKING FUNDS

SECTION 12.1 APPLICABILITY OF ARTICLE. The provisions of this
Article shall be applicable to the Securities of any series which are redeemable
before their maturity or to any sinking fund for the retirement of Securities of
a series except as otherwise specified as contemplated by Section 2.3 for
Securities of such series.

SECTION 12.2 NOTICE OF REDEMPTION; PARTIAL REDEMPTIONS. Notice of
redemption to the Holders of Registered Securities of any series to be redeemed
as a whole or in part at the option of the Issuer shall be given by mailing
notice of such redemption by first class mail, postage prepaid, at least 30 days
and not more than 60 days prior to the date

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fixed for redemption to such Holders of Securities of such series at their last
addresses as they shall appear upon the registry books. Notice of redemption to
the Holders of Unregistered Securities to be redeemed as a whole or in part, who
have filed their names and addresses with the Trustee pursuant to Section
313(c)(2) of the Trust Indenture Act shall be given by mailing notice of such
redemption, by first class mail, postage prepaid, at least 30 days and not more
than 60 prior to the date fixed for redemption, to such Holders at such
addresses as were so furnished to the Trustee (and, in the case of any such
notice given by the Issuer, the Trustee shall make such information available to
the Issuer for such purpose). Notice of redemption to all other Holders of
Unregistered Securities shall be published in an Authorized Newspaper in the
Borough of Manhattan, The City of New York and in an Authorized Newspaper in
London (and, if required by Section 3.9, in an Authorized Newspaper in
Luxembourg), in each case, once in each of three successive calendar weeks, the
first publication to be not less than 30 nor more than 60 days prior to the date
fixed for redemption. Any notice which is mailed in the manner herein provided
shall be conclusively presumed to have been duly given, whether or not the
Holder receives the notice. Failure to give notice by mail, or any defect in
the notice to the Holder of any Security of a series designated for redemption
as a whole or in part shall not affect the validity of the proceedings for the
redemption of such Security of such series.

The notice of redemption to each such Registered Holder shall specify
the principal amount of each Security of such series held by such Registered
Holder to be redeemed, the date fixed for redemption, the redemption price, the
place or places of payment, that payment will be made upon presentation and
surrender of such Securities and, in the case of Securities with Coupons
attached thereto, of all Coupons appertaining thereto maturing after the date
fixed for redemption, that such redemption is pursuant to the mandatory or
optional sinking fund, or both, if such be the case, that interest accrued to
the date fixed for redemption will be paid as specified in such notice and that
on and after said date interest thereon or on the portions thereof to be
redeemed will cease to accrue. In case any Security of a series is to be
redeemed in part only, the notice of redemption to Registered Holders of
Securities of the series shall state the portion of the principal amount thereof
to be redeemed and shall state that on and after the date fixed for redemption,
upon surrender of such Security, a new Security or Securities of such series in
principal amount equal to the unredeemed portion thereof will be issued.

The notice of redemption of Securities of any series to be redeemed at
the option of the Issuer shall be given by the Issuer or, at the Issuer's
request, by the Trustee in the name and at the expense of the Issuer.

On or before the redemption date specified in the notice of redemption
given as provided in this Section, the Issuer will deposit with the Trustee or
with one or more paying agents (or, if the Issuer is acting as its own paying
agent, set aside, segregate and hold in trust as provided in Section 3.4) an
amount of money sufficient to redeem on the redemption date all the Securities
of such series so called for redemption at the appropriate redemption price,
together with accrued interest to the date fixed for redemption. The Issuer
will deliver to the Trustee at least 70 days prior to the date fixed for
redemption, or such shorter period as shall be acceptable

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to the Trustee, an Officer's Certificate stating the aggregate principal amount
of Securities to be redeemed. In case of a redemption at the election of the
Issuer prior to the expiration of any restriction on such redemption, the Issuer
shall deliver to the Trustee, prior to the giving of any notice of redemption to
Holders pursuant to this Section, an Officer's Certificate stating that such
restriction has been complied with.

If less than all the Securities of a series are to be redeemed, the
Trustee shall select, in such manner as it shall deemed appropriate and fair, in
its sole discretion, Securities of such series to be redeemed in whole or in
part. Securities may be redeemed in part in multiples equal to the minimum
authorized denomination for Securities of such series or any multiple thereof.
The Trustee shall promptly notify the Issuer in writing of the Securities of
such series selected for redemption and, in the case of any Securities of such
series selected for partial redemption, the principal amount thereof to be
redeemed. For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities of any series
shall relate, in the case of any Security redeemed or to be redeemed only in
part, to the portion of the principal amount of such Security which has been or
is to be redeemed.

SECTION 12.3 PAYMENT OF SECURITIES CALLED FOR REDEMPTION. If notice
of redemption has been given as above provided, the Securities or portions of
Securities specified in such notice shall become due and payable on the date and
at the place stated in such notice at the applicable redemption price, together
with interest accrued to the date fixed for redemption, and on and after said
date (unless the Issuer shall default in the payment of such Securities at the
redemption price, together with interest accrued to said date) interest on the
Securities or portions of Securities so called for redemption shall cease to
accrue, and the unmatured Coupons, if any, appertaining thereto shall be void,
and, except as provided in Sections 6.5 and 10.4, such Securities shall cease
from and after the date fixed for redemption to be entitled to any benefit or
security under this Indenture, and the Holders thereof shall have no right in
respect of such Securities except the right to receive the redemption price
thereof and unpaid interest to the date fixed for redemption. On presentation
and surrender of such Securities at a place of payment specified in said notice,
together with all Coupons, if any, appertaining thereto maturing after the date
fixed for redemption, said Securities or the specified portions thereof shall be
paid and redeemed by the Issuer at the applicable redemption price, together
with interest accrued thereon to the date fixed for redemption; PROVIDED, that
payment of interest becoming due on or prior to the date fixed for redemption
shall be payable in the case of Securities with Coupons attached thereto, to the
Holders of the Coupons for such interest upon surrender thereof, and in the case
of Registered Securities, to the Holder of such Registered Securities registered
as such on the relevant record date, subject to the terms and provisions of
Section 2.3 and 2.7 hereof.

If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal shall, until paid or duly
provided for, bear interest from the date fixed for redemption at the rate of
interest or Yield to Maturity (in the case of an Original Issue Discount
Security) borne by such Security.

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If any Security with Coupons attached thereto is surrendered for
redemption and is not accompanied by all appurtenant Coupons maturing after the
date fixed for redemption, the surrender of such missing Coupon or Coupons may
be waived by the Issuer and the Trustee, if there be furnished to each of them
such security or indemnity as they may require to save each of them harmless.

Upon presentation of any Security redeemed in part only, the Issuer
shall execute and the Trustee shall authenticate and deliver to or on the order
of the Holder thereof, at the expense of the Issuer, a new Security or
Securities of such series, of authorized denominations, in principal amount
equal to the unredeemed portion of the Security so presented.

SECTION 12.4 EXCLUSION OF CERTAIN SECURITIES FROM ELIGIBILITY FOR
SELECTION FOR REDEMPTION. Securities shall be excluded from eligibility for
selection for redemption if they are identified by registration and certificate
number in an Officer's Certificate delivered to the Trustee at least 40 days
prior to the last date on which notice of redemption may be given as being owned
of record and beneficially by, and not pledged or hypothecated by, either (a)
the Issuer or (b) an entity specifically identified in such written statement as
directly or indirectly controlling or controlled by or under direct or indirect
common control with the Issuer.

SECTION 12.5 MANDATORY AND OPTIONAL SINKING FUNDS. The minimum
amount of any sinking fund payment provided for by the terms of the Securities
of any series is herein referred to as a "mandatory sinking fund payment," and
any payment in excess of such minimum amount provided for by the terms of the
Securities of any series is herein referred to as an "optional sinking fund
payment." The date on which a sinking fund payment is to be made is herein
referred to as the "sinking fund payment date."

In lieu of making all or any part of any mandatory sinking fund
payment with respect to any series of Securities in cash, the Issuer may at its
option (a) deliver to the Trustee Securities of such series theretofore
purchased or otherwise acquired (except upon redemption pursuant to the
mandatory sinking fund) by the Issuer or receive credit for Securities of such
series (not previously so credited) theretofore purchased or otherwise acquired
(except as aforesaid) by the Issuer and delivered to the Trustee for
cancellation pursuant to Section 2.10, (b) receive credit for optional sinking
fund payments (not previously so credited) made pursuant to this Section, or (c)
receive credit for Securities of such series (not previously so credited)
redeemed by the Issuer through any optional redemption provision contained in
the terms of such series. Securities so delivered or credited shall be received
or credited by the Trustee at the sinking fund redemption price specified in
such Securities.

On or before the 60th day next preceding each sinking fund payment
date for any series, the Issuer will deliver to the Trustee an Officer's
Certificate (which need not contain the statements required by Section 11.5) (a)
specifying the portion of the mandatory sinking fund payment to be satisfied by
payment of cash and the portion to be satisfied by credit of Securities

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of such series and the basis for such credit, (b) stating that none of the
Securities of such series has theretofore been so credited, (c) stating that no
defaults in the payment of interest or Events of Default with respect to such
series have occurred (which have not been waived or cured) and are continuing
and (d) stating whether or not the Issuer intends to exercise its right to make
an optional sinking fund payment with respect to such series and, if so,
specifying the amount of such optional sinking fund payment which the Issuer
intends to pay on or before the next succeeding sinking fund payment date. Any
Securities of such series to be credited and required to be delivered to the
Trustee in order for the Issuer to be entitled to credit therefor as aforesaid
which have not theretofore been delivered to the Trustee shall be delivered for
cancellation pursuant to Section 2.10 to the Trustee with such Officer's
Certificate (or reasonably promptly thereafter if acceptable to the Trustee).
Such Officer's Certificate shall be irrevocable and upon its receipt by the
Trustee, the Issuer shall become unconditionally obligated to make all the cash
payments or payments therein referred to, if any, on or before the next
succeeding sinking fund payment date. Failure of the Issuer, on or before any
such 60th day, to deliver such Officer's Certificate and Securities specified in
this paragraph, if any, shall not constitute a default but shall constitute, on
and as of such date, the irrevocable election of the Issuer (i) that the
mandatory sinking fund payment for such series due on the next succeeding
sinking fund payment date shall be paid entirely in cash without the option to
deliver or credit Securities of such series in respect thereof and (ii) that the
Issuer will make no optional sinking fund payment with respect to such series as
provided in this Section.

If the sinking fund payment or payments (mandatory or optional or
both) to be made in cash on the next succeeding sinking fund payment date plus
any unused balance of any preceding sinking fund payments made in cash shall
exceed $50,000 (or the equivalent thereof in any composite currency, currency
units, Foreign Currency or ECU) or a lesser sum in Dollars (or the equivalent
thereof in any composite currency, currency units, Foreign Currency or ECU) if
the Issuer shall so request with respect to the Securities of any particular
series, such cash shall be applied on the next succeeding sinking fund payment
date to the redemption of Securities of such series at the sinking fund
redemption price together with accrued interest to the date fixed for
redemption. If such amount shall be $50,000 (or the equivalent thereof in any
composite currency, currency units, Foreign Currency or ECU) or less and the
Issuer makes no such request then it shall be carried over until a sum in excess
of $50,000 (or the equivalent thereof in any composite currency, currency units,
Foreign Currency or ECU) is available. The Trustee shall select, in the manner
provided in Section 12.2, for redemption on such sinking fund payment date a
sufficient principal amount of Securities of such series to absorb said cash, as
nearly as may be, and shall (if requested in writing by the Issuer) inform the
Issuer of the serial numbers of the Securities of such series (or portions
thereof) so selected. Securities shall be excluded from eligibility for
redemption under this Section if they are identified by registration and
certificate number in an Officer's Certificate delivered to the Trustee at least
60 days prior to the sinking fund payment date as being owned of record and
beneficially by, and not pledged or hypothecated by, either (a) the Issuer or
(b) an entity specifically identified in such Officer's Certificate as directly
or indirectly controlling or controlled by or under direct or indirect common
control with the Issuer. The Trustee, in the name and at the expense of the
Issuer (or the Issuer, if it shall so

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request the Trustee in writing) shall cause notice of redemption of the
Securities of such series to be given in substantially the manner provided in
Section 12.2 (and with the effect provided in Section 12.3) for the redemption
of Securities of such series in part at the option of the Issuer. The amount of
any sinking fund payments not so applied or allocated to the redemption of
Securities of such series shall be added to the next cash sinking fund payment
for such series and, together with such payment, shall be applied in accordance
with the provisions of this Section. Any and all sinking fund moneys held on
the stated maturity date of the Securities of any particular series (or earlier,
if such maturity is accelerated), which are not held for the payment or
redemption of particular Securities of such series shall be applied, together
with other moneys, if necessary, sufficient for the purpose, to the payment of
the principal of, and interest on, the Securities of such series at maturity.

On or before each sinking fund payment date, the Issuer shall pay to
the Trustee in cash or shall otherwise provide for the payment of all interest
accrued to the date fixed for redemption on Securities to be redeemed on the
next following sinking fund payment date.

The Trustee shall not redeem or cause to be redeemed any Securities of
a series with sinking fund moneys or give any notice of redemption of Securities
for such series by operation of the sinking fund during the continuance of a
default in payment of interest on such Securities or of any Event of Default
except that, where the giving of notice of redemption of any Securities shall
theretofore have been made, the Trustee shall redeem or cause to be redeemed
such Securities, provided that it shall have received from the Issuer a sum
sufficient for such redemption. Except as aforesaid, any moneys in the sinking
fund for such series at the time when any such default or Event of Default shall
occur, and any moneys thereafter paid into the sinking fund, shall, during the
continuance of such default or Event of Default be deemed to have been collected
under Article Five and held for the payment of all such Securities. In case
such Event of Default shall have been waived as provided in Section 5.10 or the
default cured on or before the sixtieth day preceding the sinking fund payment
date in any year, such moneys shall thereafter be applied on the next succeeding
sinking fund payment date in accordance with this Section to the redemption of
such Securities.

67
<PAGE>

IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed and attested as of the date first written above.

UNIONBANCAL CORPORATION

By:
--------------------------------------
Name:
Title:

Attest:

By:
---------------------

THE FIRST NATIONAL BANK OF CHICAGO,
as Trustee

By:
--------------------------------------
Name:
Title:

Attest:

By:
---------------------

<PAGE>

Exhibit 4.16

- ------------------------------------------------------------------------------

FORM

PREFERRED SECURITIES GUARANTEE AGREEMENT

UNIONBANCAL FINANCE TRUST /(1)/

Dated as of [ ]

- ------------------------------------------------------------------------------

- -----------------------

(1) Insert I, II, III or IV as applicable.

<PAGE>

TABLE OF CONTENTS

Page
----
<S> <C>
ARTICLE I

DEFINITIONS AND INTERPRETATION
SECTION 1.1 DEFINITIONS AND INTERPRETATION. . . . . . . . . . . . . . . . . .3

ARTICLE II

TRUST INDENTURE ACT
SECTION 2.1 TRUST INDENTURE ACT; APPLICATION. . . . . . . . . . . . . . . . .6
SECTION 2.2 LISTS OF HOLDERS. . . . . . . . . . . . . . . . . . . . . . . . .6
SECTION 2.3 REPORTS BY THE PREFERRED GUARANTEE TRUSTEE. . . . . . . . . . . .6
SECTION 2.4 PERIODIC REPORTS TO PREFERRED GUARANTEE TRUSTEE . . . . . . . . .6
SECTION 2.5 EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT. . . . . . . . .7
SECTION 2.6 EVENTS OF DEFAULT; WAIVER . . . . . . . . . . . . . . . . . . . .7
SECTION 2.7 EVENT OF DEFAULT; NOTICE. . . . . . . . . . . . . . . . . . . . .7
SECTION 2.8 CONFLICTING INTERESTS . . . . . . . . . . . . . . . . . . . . . .7

ARTICLE III

POWERS, DUTIES AND RIGHTS OF PREFERRED GUARANTEE TRUSTEE
SECTION 3.1 POWERS AND DUTIES OF THE PREFERRED GUARANTEE TRUSTEE. . . . . . .8
SECTION 3.2 CERTAIN RIGHTS OF PREFERRED GUARANTEE TRUSTEE . . . . . . . . . .9
SECTION 3.3 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF PREFERRED
SECURITIES GUARANTEE . . . . . . . . . . . . . . . . . . . . . .11

ARTICLE IV

PREFERRED GUARANTEE TRUSTEE
SECTION 4.1 PREFERRED GUARANTEE TRUSTEE: ELIGIBILITY. . . . . . . . . . . . 11
SECTION 4.2 APPOINTMENT, REMOVAL AND RESIGNATION OF PREFERRED
GUARANTEE TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . 12

ARTICLE V

GUARANTEE
SECTION 5.1 GUARANTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 5.2 WAIVER OF NOTICE AND DEMAND . . . . . . . . . . . . . . . . . . 13
SECTION 5.3 OBLIGATIONS NOT AFFECTED. . . . . . . . . . . . . . . . . . . . 13
SECTION 5.4 RIGHTS OF HOLDERS . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 5.5 GUARANTEE OF PAYMENT. . . . . . . . . . . . . . . . . . . . . . 14
SECTION 5.6 SUBROGATION . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 5.7 INDEPENDENT OBLIGATIONS . . . . . . . . . . . . . . . . . . . . 15

<PAGE>

ARTICLE VI

LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 LIMITATION OF TRANSACTIONS. . . . . . . . . . . . . . . . . . . 15
SECTION 6.2 SUBORDINATION . . . . . . . . . . . . . . . . . . . . . . . . . 16

ARTICLE VII

TERMINATION
SECTION 7.1 TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . 16

ARTICLE VIII

INDEMNIFICATION
SECTION 8.1 EXCULPATION . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 8.2 INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . . . . . 17

ARTICLE IX

MISCELLANEOUS
SECTION 9.1 SUCCESSORS AND ASSIGNS. . . . . . . . . . . . . . . . . . . . . 17
SECTION 9.2 AMENDMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 9.3 NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 9.4 BENEFIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 9.5 GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . . 19

</TABLE>

<PAGE>

PREFERRED SECURITIES GUARANTEE AGREEMENT

This GUARANTEE AGREEMENT (the "Preferred Securities Guarantee"), dated
as of [ ], is executed and delivered by UnionBanCal Corporation, a
California corporation (the "Guarantor"), and The First National Bank of
Chicago, as trustee (the "Preferred Guarantee Trustee"), for the benefit of
the Holders (as defined herein) from time to time of the Preferred Securities
(as defined herein) of UnionBanCal Finance Trust/(2)/, a Delaware statutory
business trust (the "Issuer").

WHEREAS, pursuant to an Amended and Restated Declaration of Trust
(the "Declaration"), dated as of [ ], among the trustees of the
Issuer named therein, the Guarantor, as sponsor, and the holders from time to
time of undivided beneficial interests in the assets of the Issuer, the
Issuer is issuing on the date hereof up to [ ] preferred
securities (the "Preferred Securities"), having a liquidation amount of $[ ]
per Preferred Security designated the [ ] Preferred Securities.

WHEREAS, as incentive for the Holders to purchase the Preferred
Securities, the Guarantor desires irrevocably and unconditionally to agree,
to the extent set forth in this Preferred Securities Guarantee, to pay to the
Holders of the Preferred Securities the Guarantee Payments (as defined
herein) and to make certain other payments on the terms and conditions set
forth herein.

WHEREAS, as of the date hereof, the Guarantor is also executing and
delivering a guarantee agreement (the "Common Securities Guarantee") in
substantially identical terms to this Preferred Securities Guarantee for the
benefit of the holders of the Common Securities (as defined herein), except
that if an Event of Default (as defined in the Indenture) has occurred and is
continuing, the rights of holders of the Common Securities to receive
Guarantee Payments under the Common Securities Guarantee are subordinated to
the rights of Holders of Preferred Securities to receive Guarantee Payments
under this Preferred Securities Guarantee.

NOW, THEREFORE, in consideration of the purchase by each Holder of
Preferred Securities, which purchase the Guarantor hereby agrees shall
benefit the Guarantor, the Guarantor executes and delivers this Preferred
Securities Guarantee for the benefit of the Holders.

- --------------------

(2) Insert I, II, III or IV as applicable.

<PAGE>

ARTICLE I

DEFINITIONS AND INTERPRETATION

SECTION 1.1 DEFINITIONS AND INTERPRETATION.

In this Preferred Securities Guarantee, unless the context otherwise
requires:

(a) Capitalized terms used in this Preferred Securities Guarantee but
not defined in the preamble above have the respective meanings assigned to
them in this Section 1.1;

(b) terms defined in the Declaration as at the date of execution of
this Preferred Securities Guarantee have the same meaning when used in this
Preferred Securities Guarantee unless otherwise defined in this Preferred
Securities Guarantee;

(d) all references to "the Preferred Securities Guarantee" or "this
Preferred Securities Guarantee" are to this Preferred Securities Guarantee as
modified, supplemented or amended from time to time;

(e) all references in this Preferred Securities Guarantee to Articles
and Sections are to Articles and Sections of this Preferred Securities
Guarantee, unless otherwise specified; a term defined in the Trust Indenture
Act has the same meaning when used in this Preferred Securities Guarantee,
unless otherwise defined in this Preferred Securities Guarantee or unless the
context otherwise requires; and

(f) a reference to the singular includes the plural and vice versa.

"AUTHORIZED OFFICER" of a Person means any Person that is authorized
to legally bind such Person; PROVIDED, HOWEVER, that the Authorized Officer
signing an Officers' Certificate given pursuant to Section 314(a)(4) of the
Trust Indenture Act shall be the principal executive, financial or accounting
officer of such Person.

"COMMON SECURITIES" means the securities representing common undivided
beneficial interests in the assets of the Issuer.

"COMMON SECURITIES GUARANTEE" has the meaning assigned thereto in the
recitals hereto.

"CORPORATE TRUST OFFICE" means the office of the Preferred Guarantee
Trustee at which the corporate trust business of the Preferred Guarantee
Trustee shall, at any particular time, be principally administered, which
office at the date of execution of this Agreement is located at,

<PAGE>

The First National Bank of Chicago
One First National Plaza, Suite 0126
Chicago, IL 60670-0126
Attention: Corporate Trust Services Division

"COVERED PERSON" means any Holder or beneficial owner of Preferred
Securities.

"DECLARATION" has the meaning assigned thereto in the recitals hereto.

"EVENT OF DEFAULT" means (a) a failure by the Guarantor to perform any
of its payments or other obligations under this Preferred Securities
Guarantee or (b) if applicable, the failure by the Guarantor to deliver the
designated securities upon an appropriate election by a Holder of Preferred
Securities to convert or exchange the Preferred Securities into such
designated security.

"GUARANTEE PAYMENTS" means the following payments or distributions,
without duplication, with respect to the Preferred Securities, to the extent
not paid or made by the Issuer: (i) any accumulated and unpaid Distributions
(as defined in the Declaration) that are required to be paid on such
Preferred Securities to the extent the Issuer shall have funds available
therefor, (ii) the redemption price (the "Redemption Price"), and all
accumulated and unpaid Distributions to the date of redemption, to the extent
the Issuer has funds available therefor, with respect to any Preferred
Securities called for redemption by the Issuer, and (iii) upon a voluntary or
involuntary dissolution, winding-up or termination of the Issuer (other than
in connection with the redemption of all of the Preferred Securities or the
distribution of the Debt Securities to the Holders in exchange for Preferred
Securities as provided in the Declaration), the lesser of (a) the aggregate
of the liquidation amount and all accumulated and unpaid Distributions on the
Preferred Securities to the date of payment, to the extent the Issuer shall
have funds available therefor, and (b) the amount of assets of the Issuer
remaining available for distribution to Holders of Preferred Securities then
outstanding upon the liquidation of the Issuer (in either case, the
"Liquidation Distribution"). If an Event of Default (as defined in the
Indenture) has occurred and is continuing, the rights of holders of the
Common Securities to receive payments under the Common Securities Guarantee
Agreement are subordinated to the rights of Holders of Preferred Securities
to receive Guarantee Payments.

"GUARANTOR" has the meaning assigned thereto in the recitals hereto.

"HOLDER" shall mean any holder, as registered on the books and records
of the Issuer, of any Preferred Securities; PROVIDED, HOWEVER, that, in
determining whether the holders of the requisite percentage of Preferred
Securities have given any request, notice, consent or waiver hereunder,
"Holder" shall not include the Guarantor or any Affiliate of the Guarantor.

"INDEMNIFIED PERSON" means the Preferred Guarantee Trustee, any
Affiliate of the Preferred Guarantee Trustee, or any officers, directors,
shareholders, members, partners, employees, representatives, nominees,
custodians or agents of the Preferred Guarantee Trustee.

"INDENTURE" means the Indenture dated as of ______________, ____
between the Guarantor and The First National Bank of Chicago, as trustee, or,
if amended or supplemented as provided

<PAGE>

herein, as so amended or supplemented or both, and shall include the forms
and terms of a particular series of securities established as contemplated
thereunder.

"ISSUER" has the meaning assigned thereto in the recitals hereto.

"LIST OF HOLDERS" shall have the meaning set forth in Section 2.2.

"MAJORITY IN LIQUIDATION AMOUNT OF THE PREFERRED SECURITIES" means,
except as provided in the terms of the Preferred Securities, or except as
provided by the Trust Indenture Act, a vote by Holder(s), voting separately
as a class, of more than 50% of the liquidation amount (including the stated
amount that would be paid on redemption, liquidation or otherwise, plus
accumulated and unpaid Distributions to the date upon which the voting
percentages are determined) of all Preferred Securities.

"PERSON" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.

"PREFERRED GUARANTEE TRUSTEE" means The First National Bank of
Chicago, until a Successor Preferred Guarantee Trustee has been appointed and
has accepted such appointment pursuant to the terms of this Preferred
Securities Guarantee and thereafter means each such Successor Preferred
Guarantee Trustee.

"PREFERRED SECURITIES" has the meaning assigned thereto in the
recitals hereto.

"PREFERRED SECURITIES GUARANTEE" has the meaning assigned thereto in
the recitals hereto.

"RESPONSIBLE OFFICER" means, with respect to the Preferred Guarantee
Trustee, any officer within the Corporate Trust Office of the Preferred
Guarantee Trustee, including any vice president, any assistant vice
president, any assistant secretary, the treasurer, any assistant treasurer or
other officer of the Corporate Trust Office of the Preferred Guarantee
Trustee customarily performing functions similar to those performed by any of
the above designated officers, and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of that officer's knowledge of and familiarity with the particular
subject.

"SUCCESSOR PREFERRED GUARANTEE TRUSTEE" means a successor Preferred
Guarantee Trustee possessing the qualifications to act as Preferred Guarantee
Trustee under Section 4.1.

"TRUST SECURITIES" means the Common Securities and the Preferred
Securities.

<PAGE>

ARTICLE II

TRUST INDENTURE ACT

SECTION 2.1 TRUST INDENTURE ACT; APPLICATION.

(a) Upon its public offering pursuant to the registration
requirements of the Securities Act, this Preferred Securities Guarantee will
be subject to the provisions of the Trust Indenture Act that will be required
to be part of this Preferred Securities Guarantee and shall, to the extent
applicable, be governed by such provisions; and

(b) if and to the extent that any provision of this Preferred
Securities Guarantee limits, qualifies or conflicts with the duties imposed
by Sections 310 to 317, inclusive, of the Trust Indenture Act, such imposed
duties shall control.

SECTION 2.2 LISTS OF HOLDERS.

(a) The Guarantor shall provide the Preferred Guarantee Trustee with
a list, in such form as the Preferred Guarantee Trustee may reasonably
require, of the names and addresses of the Holders ("List of Holders")
(i) within 14 days after each record date for payment of Distributions, as of
such record date, and (ii) at any other time, within 30 days of receipt by
the Guarantor of a written request for a List of Holders as of a date no more
than 14 days before such List of Holders is given to the Preferred Guarantee
Trustee, PROVIDED that the Guarantor shall not be obligated to provide such
List of Holders at any time the List of Holders does not differ from the most
recent List of Holders given to the Preferred Guarantee Trustee by the
Guarantor. The Preferred Guarantee Trustee may destroy any List of Holders
previously given to it on receipt of a new List of Holders.

(b) The Preferred Guarantee Trustee shall comply with its obligations
under Sections 311(a), 311(b) and Section 312(b) of the Trust Indenture Act.

SECTION 2.3 REPORTS BY THE PREFERRED GUARANTEE TRUSTEE.

Within 60 days after May 15 of each year, the Preferred Guarantee
Trustee shall provide to the Holders such reports as are required by
Section 313 of the Trust Indenture Act, if any, in the form and in the manner
provided by Section 313 of the Trust Indenture Act. The Preferred Guarantee
Trustee shall also comply with the requirements of Section 313(d) of the
Trust Indenture Act.

SECTION 2.4 PERIODIC REPORTS TO PREFERRED GUARANTEE TRUSTEE.

The Guarantor shall provide to the Preferred Guarantee Trustee such
documents, reports and information (if any) as are required by Section 314
and the compliance certificate required by Section 314 of the Trust Indenture
Act in the form, the manner and at the times required by Section 314 of the
Trust Indenture Act.

<PAGE>

Delivery of such reports, information and documents to the Preferred
Guarantee Trustee is for informational purposes only and the Preferred
Guarantee Trustee's receipt of such shall not constitute constructive notice
of any information contained therein, including the Guarantor's compliance
with any of its covenants hereunder (as to which the Preferred Guarantee
Trustee is entitled to rely exclusively on Officers' Certificates).

SECTION 2.5 EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT.

The Guarantor shall provide to the Preferred Guarantee Trustee such
evidence of compliance with any conditions precedent, if any, provided for in
this Preferred Securities Guarantee that relate to any of the matters set
forth in Section 314(c) of the Trust Indenture Act. Any certificate or
opinion required to be given by an officer pursuant to Section 314(c)(1) may
be given in the form of an Officers' Certificate.

SECTION 2.6 EVENTS OF DEFAULT; WAIVER.

The Holders of a Majority in liquidation amount of Preferred
Securities may, by vote, on behalf of the Holders of all of the Preferred
Securities, waive any past Event of Default and its consequences. Upon such
waiver, any such Event of Default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every
purpose of this Preferred Securities Guarantee, but no such waiver shall
extend to any subsequent or other default or Event of Default or impair any
right consequent thereon.

SECTION 2.7 EVENT OF DEFAULT; NOTICE.

(a) The Preferred Guarantee Trustee shall, within 90 days after the
occurrence of an Event of Default actually known to a Responsible Officer of
the Preferred Guarantee Trustee, transmit by mail, first class postage
prepaid, to the Holders, notices of all such Events of Default unless such
defaults have been cured before the giving of such notice, PROVIDED that the
Preferred Guarantee Trustee shall be protected in withholding such notice if
and so long as a Responsible Officer of the Preferred Guarantee Trustee in
good faith determines that the withholding of such notice is in the interests
of the Holders.

(b) The Preferred Guarantee Trustee shall not be deemed to have
knowledge of any Event of Default unless the Preferred Guarantee Trustee
shall have received written notice thereof, or a Responsible Officer of the
Preferred Guarantee Trustee charged with the administration of this Preferred
Securities Guarantee shall have obtained actual knowledge thereof.

SECTION 2.8 CONFLICTING INTERESTS.

The Declaration shall be deemed to be specifically described in this
Preferred Securities Guarantee for the purposes of clause (i) of the first
proviso contained in Section 310(b) of the Trust Indenture Act.

<PAGE>

ARTICLE III

POWERS, DUTIES AND RIGHTS OF PREFERRED GUARANTEE TRUSTEE

SECTION 3.1 POWERS AND DUTIES OF THE PREFERRED GUARANTEE TRUSTEE.

(a) This Preferred Securities Guarantee shall be held by the
Preferred Guarantee Trustee for the benefit of the Holders and the Preferred
Guarantee Trustee shall not transfer this Preferred Securities Guarantee to
any Person except a Holder exercising his or her rights pursuant to
Section 5.4(b) or to a Successor Preferred Guarantee Trustee on acceptance by
such Successor Preferred Guarantee Trustee of its appointment to act as
Successor Preferred Guarantee Trustee. The right, title and interest of the
Preferred Guarantee Trustee shall automatically vest in any Successor
Preferred Guarantee Trustee, and such vesting and succession of title shall
be effective whether or not conveyancing documents have been executed and
delivered pursuant to the appointment of such Successor Preferred Guarantee
Trustee.

(b) If an Event of Default actually known to a Responsible Officer of
the Preferred Guarantee Trustee has occurred and is continuing, the Preferred
Guarantee Trustee shall enforce this Preferred Securities Guarantee for the
benefit of the Holders.

(c) The Preferred Guarantee Trustee, before the occurrence of any
Event of Default and after the curing of all Events of Default that may have
occurred, shall undertake to perform only such duties as are specifically set
forth in this Preferred Securities Guarantee, and no implied covenants shall
be read into this Preferred Securities Guarantee against the Preferred
Guarantee Trustee. In case an Event of Default has occurred (that has not
been cured or waived pursuant to Section 2.6) and is actually known to a
Responsible Officer of the Preferred Guarantee Trustee, the Preferred
Guarantee Trustee shall exercise such of the rights and powers vested in it
by this Preferred Securities Guarantee, and shall use the same degree of care
and skill in its exercise thereof as a prudent person would exercise or use
under the circumstances in the conduct of his or her own affairs.

(d) No provision of this Preferred Securities Guarantee shall be
construed to relieve the Preferred Guarantee Trustee from liability for its
own negligent action, its own negligent failure to act, or its own willful
misconduct, except that:

(i) prior to the occurrence of any Event of Default and after
the curing or waiving of all such Events of Default that may have
occurred:

(A) the duties and obligations of the Preferred
Guarantee Trustee shall be determined solely by the express
provisions of this Preferred Securities Guarantee, and the
Preferred Guarantee Trustee shall not be liable except for the
performance of such duties and obligations as are specifically set
forth in this Preferred Securities Guarantee, and no implied
covenants or obligations shall be read into this Preferred
Securities Guarantee against the Preferred Guarantee Trustee; and

<PAGE>

(B) in the absence of bad faith on the part of the
Preferred Guarantee Trustee, the Preferred Guarantee Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Preferred Guarantee
Trustee and conforming to the requirements of this Preferred
Securities Guarantee; but in the case of any such certificates or
opinions that by any provision hereof are specifically required to
be furnished to the Preferred Guarantee Trustee, the Preferred
Guarantee Trustee shall be under a duty to examine the same to
determine whether or not they conform to the requirements of this
Preferred Securities Guarantee;

(ii) the Preferred Guarantee Trustee shall not be liable for any
error of judgment made in good faith by a Responsible Officer of the
Preferred Guarantee Trustee, unless it shall be proved that the Preferred
Guarantee Trustee was negligent in ascertaining the pertinent facts upon
which such judgment was made;

(iii) the Preferred Guarantee Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of not less than a Majority
in liquidation amount of the Preferred Securities relating to the time,
method and place of conducting any proceeding for any remedy available to
the Preferred Guarantee Trustee, or exercising any trust or power
conferred upon the Preferred Guarantee Trustee under this Preferred
Securities Guarantee; and

(iv) no provision of this Preferred Securities Guarantee shall
require the Preferred Guarantee Trustee to expend or risk its own funds
or otherwise incur personal financial liability in the performance of any
of its duties or in the exercise of any of its rights or powers, if the
Preferred Guarantee Trustee shall have reasonable grounds for believing
that the repayment of such funds or liability is not reasonably assured
to it under the terms of this Preferred Securities Guarantee or
indemnity, reasonably satisfactory to the Preferred Guarantee Trustee,
against such risk or liability is not reasonably assured to it.

SECTION 3.2 CERTAIN RIGHTS OF PREFERRED GUARANTEE TRUSTEE.

(a) Subject to the provisions of Section 3.1:

(i) The Preferred Guarantee Trustee may conclusively rely, and
shall be fully protected in acting or refraining from acting upon, any
resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other evidence
of indebtedness or other paper or document believed by it to be genuine
and to have been signed, sent or presented by the proper party or
parties.

(ii) Any direction or act of the Guarantor contemplated by this
Preferred Securities Guarantee shall be sufficiently evidenced by an
Officers' Certificate.

(iii) Whenever, in the administration of this Preferred
Securities Guarantee, the Preferred Guarantee Trustee shall deem it
desirable that a matter be proved or established

<PAGE>

before taking, suffering or omitting any action hereunder, the Preferred
Guarantee Trustee (unless other evidence is herein specifically
prescribed) may, in the absence of bad faith on its part, request and
conclusively rely upon an Officers' Certificate which, upon receipt of
such request, shall be promptly delivered by the Guarantor.

(iv) The Preferred Guarantee Trustee shall have no duty to see
to any recording, filing or registration of any instrument (or any
rerecording, refiling or re-registration thereof).

(v) The Preferred Guarantee Trustee may consult with counsel of
its selection, and the advice or opinion of such counsel with respect to
legal matters shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good
faith and in accordance with such advice or opinion. Such counsel may be
counsel to the Guarantor or any of its Affiliates and may include any of
its employees. The Preferred Guarantee Trustee shall have the right at
any time to seek instructions concerning the administration of this
Preferred Securities Guarantee from any court of competent jurisdiction.

(vi) The Preferred Guarantee Trustee shall be under no
obligation to exercise any of the rights or powers vested in it by this
Preferred Securities Guarantee at the request or direction of any Holder,
unless such Holder shall have provided to the Preferred Guarantee Trustee
such security and indemnity, reasonably satisfactory to the Preferred
Guarantee Trustee, against the costs, expenses (including attorneys' fees
and expenses and the expenses of the Preferred Guarantee Trustee's
agents, nominees or custodians) and liabilities that might be incurred by
it in complying with such request or direction, including such reasonable
advances as may be requested by the Preferred Guarantee Trustee; PROVIDED
that nothing contained in this Section 3.2(a)(vi) shall be taken to
relieve the Preferred Guarantee Trustee, upon the occurrence of an Event
of Default, of its obligation to exercise the rights and powers vested in
it by this Preferred Securities Guarantee.

(vii) The Preferred Guarantee Trustee shall not be bound to make
any investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Preferred Guarantee
Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit.

(viii) The Preferred Guarantee Trustee may execute any of the
trusts or powers hereunder or perform any duties hereunder either
directly or by or through agents, nominees, custodians or attorneys, and
the Preferred Guarantee Trustee shall not be responsible for any
misconduct or negligence on the part of any agent or attorney appointed
with due care by it hereunder.

(ix) Any action taken by the Preferred Guarantee Trustee or its
agents hereunder shall bind the Holders and the signature of the
Preferred Guarantee Trustee or its agents

<PAGE>

alone shall be sufficient and effective to perform any such action. No
third party shall be required to inquire as to the authority of the
Preferred Guarantee Trustee to so act or as to its compliance with any
of the terms and provisions of this Preferred Securities Guarantee, both
of which shall be conclusively evidenced by the Preferred Guarantee
Trustee's or its agent's taking such action.

(x) Whenever in the administration of this Preferred Securities
Guarantee the Preferred Guarantee Trustee shall deem it desirable to
receive instructions with respect to enforcing any remedy or right or
taking any other action hereunder, the Preferred Guarantee Trustee
(i) may request instructions from the Holders of a Majority in
liquidation amount of the Preferred Securities, (ii) may refrain from
enforcing such remedy or right or taking such other action until such
instructions are received, and (iii) shall be protected in conclusively
relying on or acting in accordance with such instructions.

(xi) The Preferred Securities Trustee shall not be liable for
any action taken, suffered, or omitted to be taken by it in good faith
and reasonably believed by it to be authorized or within the discretion
or rights or powers conferred upon it by this Preferred Securities
Guarantee.

(b) No provision of this Preferred Securities Guarantee shall be
deemed to impose any duty or obligation on the Preferred Guarantee Trustee to
perform any act or acts or exercise any right, power, duty or obligation
conferred or imposed on it in any jurisdiction in which it shall be illegal,
or in which the Preferred Guarantee Trustee shall be unqualified or
incompetent in accordance with applicable law, to perform any such act or
acts or to exercise any such right, power, duty or obligation. No permissive
power or authority available to the Preferred Guarantee Trustee shall be
construed to be a duty.

SECTION 3.3 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF PREFERRED
SECURITIES GUARANTEE.

The recitals contained in this Preferred Securities Guarantee shall be
taken as the statements of the Guarantor, and the Preferred Guarantee Trustee
does not assume any responsibility for their correctness. The Preferred
Guarantee Trustee makes no representation as to the validity or sufficiency
of this Preferred Securities Guarantee.

ARTICLE IV

PREFERRED GUARANTEE TRUSTEE

SECTION 4.1 PREFERRED GUARANTEE TRUSTEE: ELIGIBILITY.

(a) There shall at all times be a Preferred Guarantee Trustee which
shall:

(i) not be an Affiliate of the Guarantor; and

<PAGE>

(ii) be a corporation organized and doing business under the
laws of the United States of America or any State or Territory thereof or
of the District of Columbia, or a corporation or Person permitted by the
Securities and Exchange Commission to act as an institutional trustee
under the Trust Indenture Act, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at least
50 million U.S. dollars ($50,000,000), and subject to supervision or
examination by federal, state, territorial or District of Columbia
authority. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of the supervising or
examining authority referred to above, then, for the purposes of this
Section 4.1(a)(ii), the combined capital and surplus of such corporation
shall be deemed to be its combined capital and surplus as set forth in
its most recent report of condition so published.

(b) If at any time the Preferred Guarantee Trustee shall cease to be
eligible to so act under Section 4.1(a), the Preferred Guarantee Trustee shall
immediately resign in the manner and with the effect set out in Section 4.2(c).

(c) If the Preferred Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Preferred Guarantee Trustee and Guarantor shall in all
respects comply with the provisions of Section 310(b) of the Trust Indenture
Act.

SECTION 4.2 APPOINTMENT, REMOVAL AND RESIGNATION OF PREFERRED GUARANTEE
TRUSTEE.

(a) Subject to Section 4.2(b), the Preferred Guarantee Trustee may be
appointed or removed without cause at any time by the Guarantor.

(b) The Preferred Guarantee Trustee shall not be removed in
accordance with Section 4.2(a) until a Successor Preferred Guarantee Trustee
has been appointed and has accepted such appointment by written instrument
executed by such Successor Preferred Guarantee Trustee and delivered to the
Guarantor.

(c) The Preferred Guarantee Trustee appointed to office shall hold
office until a Successor Preferred Guarantee Trustee shall have been
appointed or until its removal or resignation. The Preferred Guarantee
Trustee may resign from office (without need for prior or subsequent
accounting) by an instrument in writing executed by the Preferred Guarantee
Trustee and delivered to the Guarantor, which resignation shall not take
effect until a Successor Preferred Guarantee Trustee has been appointed and
has accepted such appointment by instrument in writing executed by such
Successor Preferred Guarantee Trustee and delivered to the Guarantor and the
resigning Preferred Guarantee Trustee.

(d) If no Successor Preferred Guarantee Trustee shall have been
appointed and accepted appointment as provided in this Section 4.2 within
60 days after delivery of an instrument of resignation or removal, the
Preferred Guarantee Trustee resigning or being removed may petition any court
of competent jurisdiction for appointment of a Successor Preferred Guarantee
Trustee.

<PAGE>

Such court may thereupon, after prescribing such notice, if any, as it may
deem proper, appoint a Successor Preferred Guarantee Trustee.

(e) No Preferred Guarantee Trustee shall be liable for the acts or
omissions to act of any Successor Preferred Guarantee Trustee.

(f) Upon termination of this Preferred Securities Guarantee or
removal or resignation of the Preferred Guarantee Trustee pursuant to this
Section 4.2, the Guarantor shall pay to the Preferred Guarantee Trustee all
amounts accumulated to the date of such termination, removal or resignation.

ARTICLE V

GUARANTEE

SECTION 5.1 GUARANTEE.

The Guarantor irrevocably and unconditionally agrees to pay in full to
the Holders the Guarantee Payments (without duplication of amounts
theretofore paid by the Issuer), as and when due, regardless of any defense,
right of set-off or counterclaim that the Issuer may have or assert. The
Guarantor's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Guarantor to the Holders or by causing
the Issuer to pay such amounts to the Holders. The Guarantor will honor all
obligations, if any, relating to the conversion or exchange of the Preferred
Securities into the designated security as set forth in the Declaration and
the Indenture.

SECTION 5.2 WAIVER OF NOTICE AND DEMAND.

The Guarantor hereby waives notice of acceptance of this Preferred
Securities Guarantee and of any liability to which it applies or may apply,
presentment, demand for payment, any right or remedy to require a proceeding
first against the Issuer or any other Person before proceeding directly
against the Guarantor, protest, notice of nonpayment, notice of dishonor,
notice of redemption and all other notices and demands.

SECTION 5.3 OBLIGATIONS NOT AFFECTED.

The obligations, covenants, agreements and duties of the Guarantor
under this Preferred Securities Guarantee shall in no way be affected or
impaired by reason of the happening from time to time of any of the following:

(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the Preferred Securities to be
performed or observed by the Issuer;

<PAGE>

(b) the extension of time for the payment by the Issuer of all or any
portion of the Distributions, Redemption Price, Liquidation Distribution or
any other sums payable under the terms of the Preferred Securities or the
extension of time for the performance of any other obligation under, arising
out of, or in connection with, the Preferred Securities (other than an
extension of time for payment of Distributions, Redemption Price, Liquidation
Distribution or other sum payable that results from the extension of any
interest payment period on the Debt Securities);

(c) any failure, omission, delay or lack of diligence on the part of
the Holders to enforce, assert or exercise any right, privilege, power or
remedy conferred on the Holders pursuant to the terms of the Preferred
Securities, or any action on the part of the Issuer granting indulgence or
extension of any kind;

(d) the voluntary or involuntary liquidation, dissolution, sale of
any collateral, receivership, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, arrangement, composition or
readjustment of debt of, or other similar proceedings affecting, the Issuer
or any of the assets of the Issuer;

(e) any invalidity of, or defect or deficiency in, the Preferred
Securities;

(f) the settlement or compromise of any obligation guaranteed hereby
or hereby incurred; or

(g) any other circumstance whatsoever that might otherwise constitute
a legal or equitable discharge or defense of a guarantor, it being the intent
of this Section 5.3 that the obligations of the Guarantor hereunder shall be
absolute and unconditional under any and all circumstances.

There shall be no obligation of the Holders to give notice to, or
obtain consent of, the Guarantor with respect to the happening of any of the
foregoing.

SECTION 5.4 RIGHTS OF HOLDERS.

(a) The Holders of a Majority in liquidation amount of the Preferred
Securities then outstanding have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Preferred
Guarantee Trustee in respect of this Preferred Securities Guarantee or to
direct the exercise of any trust or power conferred upon the Preferred
Guarantee Trustee under this Preferred Securities Guarantee.

(b) If the Preferred Guarantee Trustee fails to enforce this
Preferred Securities Guarantee, any Holder of Preferred Securities may
institute a legal proceeding directly against the Guarantor to enforce the
Preferred Guarantee Trustee's rights under this Preferred Securities
Guarantee, without first instituting a legal proceeding against the Issuer,
the Preferred Guarantee Trustee or any other person or entity. The Guarantor
waives any right or remedy to require that any action be brought first
against the Issuer or any other person or entity before proceeding directly
against the Guarantor. Notwithstanding the foregoing, if the Guarantor has
failed to make a

<PAGE>

guarantee payment, a Holder of Preferred Securities may directly institute a
proceeding against the Guarantor for enforcement of this Preferred Securities
Guarantee for such payment.

SECTION 5.5 GUARANTEE OF PAYMENT.

This Preferred Securities Guarantee creates a guarantee of payment and
not of collection.

SECTION 5.6 SUBROGATION.

The Guarantor shall be subrogated to all (if any) rights of the
Holders of Preferred Securities against the Issuer in respect of any amounts
paid to such Holders by the Guarantor under this Preferred Securities
Guarantee; PROVIDED, HOWEVER, that the Guarantor shall not (except to the
extent required by mandatory provisions of law) be entitled to enforce or
exercise any right that it may acquire by way of subrogation or any
indemnity, reimbursement or other agreement, in all cases as a result of
payment under this Preferred Securities Guarantee, if, at the time of any
such payment, any amounts are due and unpaid under this Preferred Securities
Guarantee. If any amount shall be paid to the Guarantor in violation of the
preceding sentence, the Guarantor agrees to hold such amount in trust for the
Holders and to pay over such amount to the Holders.

SECTION 5.7 INDEPENDENT OBLIGATIONS.

The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the Preferred
Securities, and that the Guarantor shall be liable as principal and as debtor
hereunder to make Guarantee Payments pursuant to the terms of this Preferred
Securities Guarantee notwithstanding the occurrence of any event referred to
in subsections (a) through (g), inclusive, of Section 5.3 hereof.

ARTICLE VI

LIMITATION OF TRANSACTIONS; SUBORDINATION

SECTION 6.1 LIMITATION OF TRANSACTIONS.

So long as any Preferred Securities remain outstanding, if (i) the
Guarantor has exercised its option to defer interest payments on the Debt
Securities by extending the interest payment period and such extension
period, or any extension thereof, shall be continuing, (ii) the Guarantor
shall be in default with respect to its payment or other obligations under
this Preferred Securities Guarantee or (iii) there shall have occurred and be
continuing an Event of Default under the Declaration or any event that, with
the giving of notice or lapse of time or both, would constitute an Event of
Default under the Declaration, then the Guarantor shall not (a) declare or
pay any dividend on, make any distributions with respect to, or redeem,
purchase, acquire, or make any liquidation payment with respect to, any of
its capital stock or (b) make any payment of interest, principal or premium,
if any, on or repay, repurchase or redeem any debt securities of the
Guarantor that rank PARI PASSU with or junior in interest to the Debt
Securities or make any guarantee payment with respect to any

<PAGE>

guarantee by the Guarantor of the debt securities of any subsidiary of the
Guarantor if such guarantee ranks PARI PASSU with or junior in interest to
the Debt Securities (other than (i) as a result of a reclassification of the
capital stock of the Guarantor or the exchange or conversion of one class or
series of the capital stock of the Guarantor for another class or series of
the capital stock of the Guarantor, (ii) the purchase of fractional interests
in shares of the capital stock of the Guarantor pursuant to the conversion or
exchange provisions of such capital stock or the security being converted
into or exchanged for such capital stock, (iii) dividends or distributions in
common stock of the Guarantor, (iv) any declaration of a dividend in
connection with the implementation of a stockholders' rights plan, or the
issuance of stock under any such plan in the future, or the redemption or
repurchase of any such rights pursuant thereto, (v) payments under the
Guarantee and Common Securities Guarantee, (vi) purchases of common stock of
the Guarantor related to the issuance of common stock of the Guarantor or
rights under any of the Guarantor's benefit plans for its directors, officers
or employees and (vii) obligations under any dividend reinvestment and stock
purchase plans).

SECTION 6.2 SUBORDINATION.

This Preferred Securities Guarantee will constitute an unsecured
obligation of the Guarantor and will rank (i) subordinate and junior in right
of payment to all other liabilities of the Guarantor (except any liabilities
that may be PARI PASSU expressly by their terms), (ii) PARI PASSU with the
most senior preferred or preference stock now or hereafter issued by the
Guarantor and with any guaranty now or hereafter entered into by the
Guarantor in respect of any preferred or preference stock of any Affiliate of
the Guarantor and (iii) senior to the Guarantor's common stock.

ARTICLE VII

TERMINATION

SECTION 7.1 TERMINATION.

This Preferred Securities Guarantee shall terminate as to each Holder
upon (i) full payment of the Redemption Price and accumulated and unpaid
distributions with respect to all Preferred Securities, (ii) the distribution
of the underlying securities to such Holder upon the conversion or exchange
of such Holder's Preferred Securities into the designated security, (iii) the
distribution of the Debt Securities to the Holders of the Preferred
Securities or (iv) full payment of the amounts payable in accordance with the
Declaration upon liquidation of the Issuer. This Preferred Securities
Guarantee shall terminate completely upon full payment of the amounts payable
in accordance with the Declaration. Notwithstanding the foregoing, this
Preferred Securities Guarantee will continue to be effective or will be
reinstated, as the case may be, if at any time any Holder must restore
payment of any sum paid under the Preferred Securities or under this
Preferred Securities Guarantee.

<PAGE>

ARTICLE VIII

INDEMNIFICATION

SECTION 8.1 EXCULPATION.

(a) No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Guarantor or any Covered Person
for any loss, damage, liability, expense or claim incurred by reason of any
act or omission performed or omitted by such Indemnified Person in goodfaith
in accordance with this Preferred Securities Guarantee and in a manner that
such Indemnified Person reasonably believed to be within the scope of the
authority conferred on such Indemnified Person by this Preferred Securities
Guarantee or by law, except that an Indemnified Person shall be liable for
any such loss, damage or claim incurred by reason of such Indemnified
Person's negligence or willful misconduct with respect to such acts or
omissions.

(b) An Indemnified Person shall be fully protected in relying in
good faith upon the records of the Guarantor and upon such information,
opinions, reports or statements presented to the Guarantor by any Person as
to matters the Indemnified Person reasonably believes are within such other
Person's professional or expert competence and who has been selected with
reasonable care by or on behalf of the Guarantor, including information,
opinions, reports or statements as to the value and amount of the assets,
liabilities, profits, losses or any other facts pertinent to the existence
and amount of assets from which Distributions to Holders might properly be
paid.

SECTION 8.2 INDEMNIFICATION.

The Guarantor agrees to indemnify each Indemnified Person for, and to
hold each Indemnified Person harmless against, any loss, liability or expense
incurred without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of the trust or trusts
hereunder, including the costs and expenses (including reasonable legal fees and
expenses) of defending itself against, or investigating, any claim or liability
in connection with the exercise or performance of any of its powers or duties
hereunder. The provisions of this Section 8.2 shall survive the termination of
this Preferred Securities Guarantee or the resignation or removal of the
Preferred Guarantee Trustee.

When the Preferred Guarantee Trustee incurs expenses or renders services
in connection with an Event of Default specified in Section 5.1(d) or Section
5.1(e) of the Indenture, the expenses (including the reasonable charges and
expenses of its counsel) and the compensation for services are intended to
constitute expenses of administration under any applicable federal or state
bankruptcy, insolvency or other similar law.

<PAGE>

ARTICLE IX

MISCELLANEOUS

SECTION 9.1 SUCCESSORS AND ASSIGNS.

All guarantees and agreements contained in this Preferred Securities
Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the
Holders of the Preferred Securities then outstanding. Except in connection
with any merger or consolidation of the Guarantor with or into another entity
permitted by Section 9.1 of the Indenture or any sale, transfer or lease of
the Guarantor's assets to another entity permitted by Section 9.1 of the
Indenture, the Guarantor may not assign its rights or delegate its
obligations under this Preferred Securities Guarantee without the prior
approval of the holders of at least a Majority in liquidation amount of the
Preferred Securities then outstanding.

SECTION 9.2 AMENDMENTS.

Except with respect to any changes that do not adversely affect the
rights of Holders (in which case no consent of Holders will be required), this
Preferred Securities Guarantee may only be amended with the prior approval of
the Holders of at least a Majority in liquidation amount (including the stated
amount that would be paid on redemption, liquidation or otherwise, plus
accumulated and unpaid Distributions to the date upon which the voting
percentages are determined) of the Preferred Securities then outstanding. The
provisions of the Declaration with respect to meetings of Holders apply to the
giving of such approval.

SECTION 9.3 NOTICES.

All notices provided for in this Preferred Securities Guarantee shall
be in writing, duly signed by the party giving such notice, and shall be
delivered, telecopied or mailed by first class mail, as follows:

(a) If given to the Preferred Guarantee Trustee, at the Preferred
Guarantee Trustee's mailing address set forth below (or such other address as
the Preferred Guarantee Trustee may give notice of to the Holders of the
Preferred Securities):

The First National Bank of Chicago
One First National Plaza, Suite 0126
Chicago, IL 60670-0126
Attention: Corporate Trust Services Division

<PAGE>

(b) If given to the Guarantor, at the Guarantor's mailing address
set forth below (or such other address as the Guarantor may give notice of to
the Holders of the Preferred Securities):

UnionBanCal Corporation
400 California Street
San Francisco, California 94104

Attention: General Counsel

All such notices shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid, except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no
notice was given, such notice or other document shall be deemed to have been
delivered on the date of such refusal or inability to deliver.

SECTION 9.4 BENEFIT.

This Preferred Securities Guarantee is solely for the benefit of the
Holders of the Preferred Securities and, subject to Section 3.1(a), is not
separately transferable from the Preferred Securities.

SECTION 9.5 GOVERNING LAW.

THIS PREFERRED SECURITIES GUARANTEE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AS APPLIED TO CONTRACTS MADE
AND PERFORMED WITHIN THE STATE OF NEW YORK INCLUDING, WITHOUT LIMITATION,
SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.

<PAGE>

THIS PREFERRED SECURITIES GUARANTEE is executed as of the day and year
first above written.

UNIONBANCAL CORPORATION, as Guarantor

By:
----------------------------------
Name:
Title:

THE FIRST NATIONAL BANK OF CHICAGO, as
Preferred Guarantee Trustee

By:
-----------------------------------
Name:
Title:

<PAGE>

Exhibit 4.20

-------------------------------------------------------------

UNIONBANCAL CORPORATION

and

_________________________________,
As Depositary

and

HOLDERS OF DEPOSITARY RECEIPTS

------------

DEPOSIT AGREEMENT

------------

Dated as of ____________ ___, ___

-------------------------------------------------------------

<PAGE>

TABLE OF CONTENTS

<TABLE>
<S> <C>
ARTICLE I

DEFINITIONS . . . . . . . . . . . . . . . 1

ARTICLE II

FORM OF RECEIPTS, DEPOSIT OF STOCK,
EXECUTION AND DELIVERY, TRANSFER, SURRENDER,
REDEMPTION AND CONVERSION OF RECEIPTS. . . . . . . . . 3

SECTION 2.01. Form and Transfer of Receipts . . . . . . . . . . . . . . . . . 3
SECTION 2.02. Temporary Receipts. . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 2.03. Deposit of Stock; Execution and Delivery of
Receipts in Respect Thereof . . . . . . . . . . . . . . . . . . 4
SECTION 2.04. Redemption and Conversion of Stock. . . . . . . . . . . . . . . 5
SECTION 2.05. Register of Transfer of Receipts. . . . . . . . . . . . . . . . 7
SECTION 2.06. Combination and Split-ups of Receipts . . . . . . . . . . . . . 8
SECTION 2.07. Surrender of Receipts and Withdrawal of Stock . . . . . . . . . 8
SECTION 2.08. Limitations on Execution and Delivery, Transfer,
Split-up, Combination, Surrender and Exchange of Receipts
and Withdrawal or Deposit of Stock. . . . . . . . . . . . . . . 9
SECTION 2.09. Lost Receipts, etc. . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 2.10. Cancellation and Destruction of Surrendered Receipts. . . . . .10

ARTICLE III

CERTAIN OBLIGATIONS OF HOLDERS OF RECEIPTS AND THE COMPANY . . .10

SECTION 3.01. Filing Proofs, Certificates and Other Information . . . . . . .10
SECTION 3.02. Payment of Taxes or Other Governmental Charges. . . . . . . . .10
SECTION 3.03. Withholding . . . . . . . . . . . . . . . . . . . . . . . . . .11
SECTION 3.04. Representations and Warranties as to Stock. . . . . . . . . . .11

i
<PAGE>

ARTICLE IV

THE STOCK, NOTICES . . . . . . . . . . . . .11

SECTION 4.01. Cash Distributions. . . . . . . . . . . . . . . . . . . . . . .11
SECTION 4.02. Distributions Other Than Cash . . . . . . . . . . . . . . . . .12
SECTION 4.03. Subscription Rights, Preferences or Privileges. . . . . . . . .12
SECTION 4.04. Notice of Dividends, Fixing of Record Date for
Holders of Receipts . . . . . . . . . . . . . . . . . . . . . .13
SECTION 4.05. Voting Rights . . . . . . . . . . . . . . . . . . . . . . . . .13
SECTION 4.06. Changes Affecting Stock and Reclassifications,
Recapitalizations, etc. . . . . . . . . . . . . . . . . . . . .14
SECTION 4.07. Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
SECTION 4.08. Lists of Receipt Holders. . . . . . . . . . . . . . . . . . . .14

ARTICLE V

THE DEPOSITARY, THE DEPOSITARY'S AGENTS,
THE REGISTRAR AND THE COMPANY. . . . . . . . . . .15

SECTION 5.01. Maintenance of Offices, Agencies, Transfer Books by
the Depositary; the Registrar . . . . . . . . . . . . . . . . .15
SECTION 5.02. Prevention or Delay in Performance by the Depositary,
the Depositary's Agents, the Registrar or the Company . . . . .15
SECTION 5.03. Obligations of the Depositary, the Depositary's Agents,
the Registrar and the Company . . . . . . . . . . . . . . . . .16
SECTION 5.04. Resignation and Removal of the Depositary, Appointment of
Successor Depositary . . . . . . . . . . . . . . . . . . . . .17
SECTION 5.05. Corporate Notices and Reports . . . . . . . . . . . . . . . . .18
SECTION 5.06. Deposit of Stock by the Company . . . . . . . . . . . . . . . .19
SECTION 5.07. Indemnification by the Company. . . . . . . . . . . . . . . . .19
SECTION 5.08. Fees, Charges and Expenses. . . . . . . . . . . . . . . . . . .19

ii
<PAGE>

ARTICLE VI

AMENDMENT AND TERMINATION . . . . . . . . . . .19

SECTION 6.01. Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . .19
SECTION 6.02. Termination . . . . . . . . . . . . . . . . . . . . . . . . . .20

ARTICLE VII

MISCELLANEOUS. . . . . . . . . . . . . . .21

SECTION 7.01. Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . .21
SECTION 7.02. Exclusive Benefits of Parties . . . . . . . . . . . . . . . . .21
SECTION 7.03. Invalidity of Provisions. . . . . . . . . . . . . . . . . . . .21
SECTION 7.04. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . .22
SECTION 7.05. Depositary's Agents . . . . . . . . . . . . . . . . . . . . . .22
SECTION 7.06. Holders of Receipts Are Parties . . . . . . . . . . . . . . . .22
SECTION 7.07. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . .23
SECTION 7.08. Headings. . . . . . . . . . . . . . . . . . . . . . . . . . . .23
EXHIBIT A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1
Parties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Recitals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

</TABLE>

iii
<PAGE>

DEPOSIT AGREEMENT

DEPOSIT AGREEMENT, dated as of ________ ___, ____, among UnionBanCal
Corporation, a California corporation, ___________________________, a ________
banking corporation, as Depositary, and all holders from time to time of
Receipts issued hereunder.

W I T N E S S E T H:

WHEREAS, the Company desires to provide as hereinafter set forth in
this Deposit Agreement, for the deposit of shares of Stock with the Depositary,
as agent for the beneficial owners of the Stock, for the purposes set forth in
this Deposit Agreement and for the issuance hereunder of the Receipts evidencing
Depositary Shares representing an interest in the Stock so deposited; and

WHEREAS, the Receipts are to be substantially in the form annexed as
Exhibit A to this Deposit Agreement, with appropriate insertions, modifications
and omissions, as hereinafter provided in this Deposit Agreement.

NOW, THEREFORE, in consideration of the premises contained herein, it
is agreed by and among the parties hereto as follows:

ARTICLE I

DEFINITIONS

The following definitions shall apply to the respective terms (in the
singular and plural forms of such terms) used in this Deposit Agreement and the
Receipts:

"Articles of Incorporation" shall mean the Articles of Incorporation,
as amended and restated from time to time, of the Company.

"Certificate of Determination" shall mean the Certificate of
Determination establishing and setting forth the rights, preferences, privileges
and limitations of the Stock.

"Common Stock" shall mean the Company's Common Stock.

"Company" shall mean UnionBanCal Corporation, a California
corporation, and its successors.

"Corporate Office" shall mean the office of the Depositary in
__________, ______________ at which at any particular time its business in
respect of matters governed by

1
<PAGE>

this Deposit Agreement shall be administered, which at the date of this Deposit
Agreement is located at ______________________.

"Deposit Agreement" shall mean this agreement, as the same may be
amended, modified or supplemented from time to time.

"Depositary" shall mean _________________________________, as
Depositary hereunder, and any successor as Depositary hereunder.

"Depositary Share" shall mean the rights evidenced by the Receipts
executed and delivered hereunder, including the interests in Stock granted to
holders of Receipts pursuant to the terms and conditions of the Deposit
Agreement. Each Depositary Share shall represent an interest in __________ of a
share of Stock deposited with the Depositary hereunder and the same
proportionate interest in any and all other property received by the Depositary
in respect of such share of Stock and held under this Deposit Agreement.
Subject to the terms of this Deposit Agreement, each record holder of a Receipt
evidencing a Depositary Share or Shares is entitled, proportionately, to all the
rights, preferences and privileges of the Stock represented by such Depositary
Share or Shares, including the dividend, voting and liquidation rights contained
in the Certificate of Determination, and to the benefits of all obligations and
duties of the Company in respect of the Stock under the Certificate of
Determination and the Articles of Incorporation.

"Depositary's Agent" shall mean an agent appointed by the Depositary
as provided, and for the purposes specified, in Section 7.05.

"New York Office" shall mean the facility maintained by the Depositary
in the Borough of Manhattan, The City of New York, for accepting, executing and
delivering Receipts and other instruments prior to processing such instruments
at the Corporate Office, which facility at the date of this Deposit Agreement is
located at ______________________.

"Receipt" shall mean a Depositary Receipt executed and delivered
hereunder, in substantially the form of Exhibit A hereto, evidencing a
Depositary Share or Depositary Shares, as the same may be amended from time to
time in accordance with the provisions hereof.

"record holder" or "holder" as applied to a Receipt shall mean the
person in whose name a Receipt is registered on the books maintained by or on
behalf of the Depositary for such purpose.

"Registrar" shall mean any bank or trust company appointed to register
ownership and transfers of Receipts as herein provided.

"Securities Act" shall mean the Securities Act of 1933, as amended.

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<PAGE>

"Stock" shall mean shares of the Company's ___________ Series
Preferred Stock.

ARTICLE II

FORM OF RECEIPTS, DEPOSIT OF STOCK,
EXECUTION AND DELIVERY, TRANSFER, SURRENDER,
REDEMPTION AND CONVERSION OF RECEIPTS

SECTION 2.01. FORM AND TRANSFER OF RECEIPTS.

Receipts shall be engraved or printed or lithographed on
steel-engraved borders and shall be substantially in the form set forth in
Exhibit A annexed to this Deposit Agreement, with appropriate insertions,
modifications and omissions, as hereinafter provided. Receipts shall be
executed by the Depositary by the manual signature of a duly authorized
signatory of the Depositary; provided, however, that such signature may be a
facsimile if a Registrar (other than the Depositary) shall have countersigned
the Receipts by manual signature of a duly authorized signatory of the
Registrar. No Receipt shall be entitled to any benefits under this Deposit
Agreement or be valid or obligatory for any purpose unless it shall have been
executed as provided in the preceding sentence. The Depositary shall record
on its books each Receipt executed as provided above and delivered as
hereinafter provided. Receipts bearing the facsimile signature of anyone who
was at any time a duly authorized officer of the Depositary shall bind the
Depositary, notwithstanding that such officer has ceased to hold such office
prior to the delivery of such Receipts.

Receipts may be issued in denominations of any number of whole
Depositary Shares. All Receipts shall be dated the date of their execution.

Receipts may be endorsed with or have incorporated in the text thereof
such legends or recitals or changes not inconsistent with the provisions of this
Deposit Agreement as may be required by the Depositary or required to comply
with any applicable law or regulation or with the rules and regulations of any
securities exchange upon which the Stock or the Depositary Shares may be listed
or to conform with any usage with respect thereto, or to indicate any special
limitations or restrictions to which any particular Receipts are subject by
reason of the date of issuance of the Stock or otherwise.

Title to any Receipt (and to the Depositary Shares evidenced by such
Receipt) that is properly endorsed or accompanied by a properly executed
instrument of transfer shall be transferable by delivery with the same effect as
in the case of a negotiable instrument; provided, however, that the Depositary
may, notwithstanding any notice to the contrary, treat the record holder thereof
at such time as the absolute owner thereof for the purpose of determining the

3
<PAGE>

person entitled to distributions of dividends or other distributions or to any
notice provided for in this Deposit Agreement and for all other purposes.

SECTION 2.02. TEMPORARY RECEIPTS.

Pending the preparation of definitive Receipts, the Depositary may,
upon written order of the Company, issue temporary Receipts substantially
identical to (and entitling the holders thereof to all the rights pertaining to)
the definitive Receipts but not in definitive form. Definitive Receipts will be
prepared thereafter without unreasonable delay, and such temporary Receipts will
be exchangeable for definitive Receipts at the Company's expense.

SECTION 2.03. DEPOSIT OF STOCK; EXECUTION AND DELIVERY OF RECEIPTS IN
RESPECT THEREOF.

Subject to the terms and conditions of this Deposit Agreement, the
Company or any holder of Stock may deposit such Stock under this Deposit
Agreement by delivery to the Depositary of a certificate or certificates for the
Stock to be deposited, properly endorsed or accompanied, if required by the
Depositary, by a properly executed instrument of transfer in form satisfactory
to the Depositary, together with (a) all such certifications as may be required
by the Depositary in accordance with the provisions of this Deposit Agreement
and (b) a written order of the Company or such holder, as the case may be,
directing the Depositary to execute and deliver to or upon the written order of
the person or persons stated in such order a Receipt or Receipts for the number
of Depositary Shares representing such deposited Stock.

Upon receipt by the Depositary of a certificate or certificates for
Stock to be deposited hereunder, together with the other documents specified
above, the Depositary shall, as soon as transfer and registration can be
accomplished, present such certificate or certificates to the registrar and
transfer agent of the Stock for transfer and registration in the name of the
Depositary or its nominee of the Stock being deposited. Deposited Stock shall
be held by the Depositary in an account to be established by the Depositary at
the Corporate Office.

Upon receipt by the Depositary of a certificate or certificates for
Stock to be deposited hereunder, together with the other documents specified
above, the Depositary, subject to the terms and conditions of this Deposit
Agreement, shall execute and deliver, to or upon the order of the person or
persons named in the written order delivered to the Depositary referred to in
the first paragraph of this Section 2.03, a Receipt or Receipts for the number
of whole Depositary Shares representing the Stock so deposited and registered in
such name or names as may be requested by such person or persons. The
Depositary shall execute and deliver such Receipt or Receipts at the New York
Office, except that, at the request, risk and expense of any person requesting
such delivery and for the account of such person, such delivery may be made at
such other place as may be designated by such person. In each case, delivery
will be made

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<PAGE>

only upon payment by such person to the Depositary of all taxes and other
governmental charges and any fees payable in connection with such deposit and
the transfer of the deposited Stock.

The Company shall deliver to the Depositary from time to time such
quantities of Receipts as the Depositary may request to enable the Depositary to
perform its obligations under this Deposit Agreement.

SECTION 2.04. REDEMPTION AND CONVERSION OF STOCK.(1)

Whenever the Company shall elect to redeem or be required to convert
shares of Stock into shares of Common Stock in accordance with the Certificate
of Determination, it shall (unless otherwise agreed in writing with the
Depositary) give the Depositary in its capacity as Depositary not less than 5
business days' prior notice of the proposed date of the mailing of a notice of
redemption or conversion of Stock and the simultaneous redemption or conversion
of the Depositary Shares representing the Stock to be redeemed or converted and
of the number of such shares of Stock held by the Depositary to be redeemed or
converted. The Depositary shall, as directed by the Company in writing, mail,
first class postage prepaid, notice of the redemption or conversion of Stock and
the proposed simultaneous redemption or conversion of the Depositary Shares
representing the Stock to be redeemed or converted, not less than 30 and not
more than 60 days prior to the date fixed for redemption or conversion of such
Stock and Depositary Shares, to the record holders of the Receipts evidencing
the Depositary Shares to be so redeemed or converted, at the addresses of such
holders as the same appear on the records of the Depositary; provided, that if
the effectiveness of a Merger or Consolidation (as defined in the Certificate of
Determination) makes it impracticable to provide at least 30 days' notice, the
Depositary shall provide such notice as soon as practicable prior to such
effectiveness. Any such notice shall also be published in the same manner as
notices of redemption or conversion of Stock are required to be published
pursuant to the Certificate of Determination. Notwithstanding the foregoing,
neither failure to mail or publish any such notice to one or more such holders
nor any defect in any notice shall affect the sufficiency of the proceedings for
redemption or conversion. The Company shall provide the Depositary with such
notice, and each such notice shall state: the redemption or conversion date; the
number of Depositary Shares to be redeemed or converted; if fewer than all the
Depositary Shares held by any holder are to be redeemed, the number of such
Depositary Shares held by such holder to be so redeemed; in the case of a call
for redemption, the call price payable upon redemption and the Current Market
Price (as defined in the Certificate of Determination to be used to calculate
the number of shares of Common Stock deliverable upon redemption; whether the
Company is exercising any option to deliver shares of Common Stock in lieu of
any cash consideration pursuant to the Certificate of Determination and the
Current Market Price to be used to calculate the number of such shares; the
place or places where Receipts evidencing Depositary Shares to be redeemed or
converted are to be surrendered for

- -----------------------

(1) This section to be modified to discuss specific redemption or
conversion terms of the Stock, if any.

5
<PAGE>

redemption or conversion; whether the Company is depositing with a bank or trust
company on or before the redemption or conversion date, the shares of Common
Stock and cash, if any, payable by the Company and the proposed date of such
deposit; the amount of accrued and unpaid dividends payable per share of Stock
to be redeemed or converted to and including such redemption or conversion date,
as the case may be, and that diviends in respect of the Stock represented by the
Depositary Shares to be redeemed or converted will cease to accrue on such
redemption or conversion date (unless the Company shall default in delivering
shares of Common Stock and cash, if any, at the time and place specified in such
notice). On the date of any such redemption or conversion, the Depositary shall
surrender the certificate or certificates held by the Depositary evidencing the
number of shares of Stock to be redeemed or converted in the manner specified in
the notice of redemption or conversion of Stock provided by the Company pursuant
to the Certificate of Determination. The Depositary shall, thereafter, redeem
or convert the number of Depositary Shares representing such redeemed or
converted Stock upon the surrender of Receipts evidencing such Depositary Shares
in the manner provided in the notice sent to record holders of Receipts;
provided, that the Depositary shall have received, upon surrendering such
certificate or certificates as aforesaid, a sufficient number of shares of
Common Stock to convert or redeem such number of Depositary Shares (including,
in the event that the Company elects pursuant to the Certificate of
Determination to exercise any option to deliver shares of Common Stock in lieu
of any cash consideration payable on the Effective Date (as defined in the
Certificate of Determination) of any Merger or Consolidation, a number of shares
of Common Stock equal to such cash consideration (as determined in the manner
set forth in the Certificate of Determination)), plus any accrued and unpaid
dividends payable with respect thereto to and including the date of any such
redemption or conversion and any other cash consideration payable on the
Effective Date of a Merger or Consolidation (other than any dividends or other
cash consideration payable on the Effective Date of a Merger or Consolidation
that the Company has elected to pay in shares of Common Stock pursuant to the
Certificate of Determination) as instructed and calculated by the Company. In
case fewer than all the outstanding Depositary Shares are to be redeemed, the
Depositary Shares to be redeemed shall be selected by the Depositary by lot or
on a pro rata basis.

Notice having been mailed by the Depositary as aforesaid, from and
after the redemption or conversion date (unless the Company shall have failed to
redeem or convert the shares of Stock to be redeemed or converted by it upon the
surrender of the certificate or certificates therefor by the Depositary as
described in the preceding paragraph), the Depositary Shares called for
redemption or subject to conversion shall be deemed no longer to be outstanding
and all rights of the holders of Receipts evidencing such Depositary Shares
(except the right to receive the shares of Common Stock and cash, if any,
payable upon redemption or conversion upon surrender of such Receipts) shall, to
the extent of such Depositary Shares, cease and terminate. Upon surrender in
accordance with said notice of the Receipts evidencing such Depositary Shares
(properly endorsed or assigned for transfer, if the Depositary shall so
require), such Depositary Shares shall be converted into or redeemed for shares
of Common Stock at a rate equal to ______________ of the number of shares of
Common Stock delivered, and the holders thereof shall be entitled to
______________ of the cash, if any, payable, in respect of the

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<PAGE>

shares of Stock pursuant to the Certificate of Determination. The foregoing
shall be subject further to the terms and conditions of the Certificate of
Determination.

If fewer than all of the Depositary Shares evidenced by a Receipt are
called for redemption, the Depositary will deliver to the holder of such Receipt
upon its surrender to the Depositary, together with the shares of Common Stock
and all accrued and unpaid dividends to and including the date fixed for
redemption payable in respect of the Depositary Shares called for redemption, a
new Receipt evidencing the Depositary Shares evidenced by such prior Receipt and
not called for redemption.

To the extent that Depositary Shares are converted into or redeemed
for shares of Common Stock and all of such shares of Common Stock cannot be
distributed to the record holders of Receipts converted or called for redemption
without creating fractional interests in such shares, the Depositary may, with
the consent of the Company, adopt such method as it deems equitable and
practicable for the purpose of effecting such distribution, including the sale
(at public or private sale) of such shares of Common Stock at such place or
places and upon such terms as it may deem proper, and the net proceeds of any
such sale shall, subject to Section 3.02, be distributed or made available for
distribution to such record holders that would otherwise receive fractional
interests in such shares of Common Stock.

The Depositary shall not be required (a) to issue, transfer or
exchange any Receipts for a period beginning at the opening of business 15 days
next preceding any selection of Depositary Shares and Stock to be redeemed and
ending at the close of business on the day of the mailing of notice of
redemption of Depositary Shares or (b) to transfer or exchange for another
Receipt any Receipt evidencing Depositary Shares called or being called for
redemption, in whole or in part, or subject to conversion except as provided in
the second preceding paragraph of this Section 2.04.

Any funds deposited by the Company with the Depositary for any
Depositary Shares that are not claimed after a period of two years from the date
such funds are so deposited will be returned to the Company.

SECTION 2.05. REGISTER OF TRANSFER OF RECEIPTS.

Subject to the terms and conditions of this Deposit Agreement, the
Depositary shall register on its books from time to time transfers of Receipts
upon any surrender thereof at the Corporate Office, the New York Office or such
other office as the Depositary may designate for such purpose, by the record
holder in person or by a duly authorized attorney, properly endorsed or
accompanied by a properly executed instrument of transfer, together with
evidence of the payment of any transfer taxes as may be required by law. Upon
such surrender, the Depositary shall execute a new Receipt or Receipts and
deliver the same to or upon the order of the person entitled thereto evidencing
the same aggregate number of Depositary Shares evidenced by the Receipt or
Receipts surrendered.

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<PAGE>

SECTION 2.06. COMBINATION AND SPLIT-UPS OF RECEIPTS.

Upon surrender of a Receipt or Receipts at the Corporate Office, the
New York Office or such other office as the Depositary may designate for the
purpose of effecting a split-up or combination of Receipts, subject to the terms
and conditions of this Deposit Agreement, the Depositary shall execute and
deliver a new Receipt or Receipts in the authorized denominations requested
evidencing the same aggregate number of Depositary Shares evidenced by the
Receipt or Receipts surrendered; provided, however, that the Depositary shall
not issue any Receipt evidencing a fractional Depositary Share.

SECTION 2.07. SURRENDER OF RECEIPTS AND WITHDRAWAL OF STOCK.(2)

Any holder of a Receipt or Receipts may withdraw any or all of the
Stock (but only in whole shares of Stock) represented by the Depositary Shares
evidenced by such Receipts and all money and other property, if any, represented
by such Depositary Shares by surrendering such Receipt or Receipts at the
Corporate Office, the New York Office or at such other office as the Depositary
may designate for such withdrawals. After such surrender, without unreasonable
delay, the Depositary shall deliver to such holder, or to the person or persons
designated by such holder as hereinafter provided, the whole number of shares of
Stock and all such money and other property, if any, represented by the
Depositary Shares evidenced by the Receipt or Receipts so surrendered for
withdrawal. If the Receipt or Receipts delivered by the holder to the
Depositary in connection with such withdrawal shall evidence a number of
Depositary Shares in excess of the number of whole Depositary Shares
representing the whole number of shares of Stock to be withdrawn, the Depositary
shall at the same time, in addition to such whole number of shares of Stock and
such money and other property, if any, to be withdrawn, deliver to such holder,
or (subject to Section 2.05) upon his order, a new Receipt or Receipts
evidencing such excess number of whole Depositary Shares. Delivery of the Stock
and such money and other property being withdrawn may be made by the delivery of
such certificates, documents of title and other instruments as the Depositary
may deem appropriate, which, if required by the Depositary, shall be properly
endorsed or accompanied by proper instruments of transfer.

If the Stock and the money and other property being withdrawn are to
be delivered to a person or persons other than the record holder of the Receipt
or Receipts being surrendered for withdrawal of Stock, such holder shall execute
and deliver to the Depositary a written order so directing the Depositary and
the Depositary may require that the Receipt or Receipts surrendered by such
holder for withdrawal of such shares of Stock be properly endorsed in blank or
accompanied by a properly executed instrument of transfer in blank and that the
signature on such instrument of transfer be guaranteed by an eligible guarantor
institution (banks,

- -----------------------

(2) This section to be modified to reflect any restriction on withdrawal
of underlying securities.

8
<PAGE>

stockbrokers, savings and loan associations and credit unions with membership in
an approved signature guarantee medallion program) pursuant to Rule 17Ad-15 of
the Securities Exchange Act of 1934, as amended.

The Depositary shall deliver the Stock and the money and other
property, if any, represented by the Depositary Shares evidenced by Receipts
surrendered for withdrawal, without unreasonable delay, at the office at which
such Receipts were surrendered, except that, at the request, risk and expense of
the holder surrendering such Receipt or Receipts and for the account of the
holder thereof, such delivery may be made, without unreasonable delay, at such
other place as may be designated by such holder.

SECTION 2.08. LIMITATIONS ON EXECUTION AND DELIVERY, TRANSFER,
SPLIT-UP, COMBINATION, SURRENDER AND EXCHANGE OF
RECEIPTS AND WITHDRAWAL OR DEPOSIT OF STOCK.

As a condition precedent to the execution and delivery, registration
of transfer, split-up, combination, surrender or exchange of any Receipt, the
delivery of any distribution thereon or the withdrawal or deposit of Stock, the
Depositary, any of the Depositary's Agents or the Company may require any or all
of the following: (a) payment to it of a sum sufficient for the payment (or, in
the event that the Depositary or the Company shall have made such payment, the
reimbursement to it) of any tax or other governmental charge with respect
thereto (including any such tax or charge with respect to the Stock being
deposited or withdrawn or with respect to the Common Stock or other securities
or property of the Company being issued upon conversion or redemption); (b)
production of proof satisfactory to it as to the identity and genuineness of any
signature; and (c) compliance with such reasonable regulations, if any, as the
Depositary or the Company may establish not inconsistent with the provisions of
this Deposit Agreement.

The deposit of Stock may be refused, the delivery of Receipts against
Stock or the registration of transfer, split-up, combination, surrender or
exchange of outstanding Receipts and the withdrawal of deposited Stock may be
suspended (a) during any period when the register of shareholders of the Company
is closed, (b) if any such action is deemed necessary or advisable by the
Depositary, any of the Depositary's Agents or the Company at any time or from
time to time because of any requirement of law or of any government or
governmental body or commission, or under any provision of this Deposit
Agreement, or (c) with the approval of the Company, for any other reason.
Without limitation of the foregoing, the Depositary shall not knowingly accept
for deposit under this Deposit Agreement any shares of Stock that are required
to be registered under the Securities Act unless a registration statement under
the Securities Act is in effect as to such shares of Stock.

SECTION 2.09. LOST RECEIPTS, ETC.

In case any Receipt shall be mutilated or destroyed or lost or stolen,
the Depositary shall execute and deliver a Receipt of like form and tenor in
exchange and substitution for

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<PAGE>

such mutilated Receipt or in lieu of and in substitution for such destroyed,
lost or stolen Receipt unless the Depositary has notice that such Receipt has
been acquired by a bona fide purchaser; provided, however, that the holder
thereof provides the Depositary with (a) evidence satisfactory to the Depositary
of such destruction, loss or theft of such Receipt, of the authenticity thereof
and of his ownership thereof, (b) reasonable indemnification satisfactory to the
Depositary or the payment of any charges incurred by the Depositary in obtaining
insurance in lieu of such indemnification and (c) payment of any expense
(including fees, charges and expenses of the Depositary) in connection with such
execution and delivery.

SECTION 2.10. CANCELLATION AND DESTRUCTION OF SURRENDERED RECEIPTS.

All Receipts surrendered to the Depositary or any Depositary's Agent
shall be cancelled by the Depositary. Except as prohibited by applicable law or
regulation, the Depositary is authorized to destroy such Receipts so cancelled.

ARTICLE III

CERTAIN OBLIGATIONS OF HOLDERS
OF RECEIPTS AND THE COMPANY

SECTION 3.01. FILING PROOFS, CERTIFICATES AND OTHER INFORMATION.

Any person presenting Stock for deposit or any holder of a Receipt may
be required from time to time to file such proof of residence or other
information, to execute such certificates and to make such representations and
warranties as the Depositary or the Company may reasonably deem necessary or
proper. The Depositary or the Company may withhold or delay the delivery of any
Receipt, the registration of transfer, redemption, conversion or exchange of any
Receipt, the withdrawal of the Stock represented by the Depositary Shares
evidenced by any Receipt or the distribution of any dividend or other
distribution until such proof or other information is filed, such certificates
are executed or such representations and warranties are made.

SECTION 3.02. PAYMENT OF TAXES OR OTHER GOVERNMENTAL CHARGES.

If any tax or other governmental charge shall become payable by or on
behalf of the Depositary with respect to (a) any Receipt, (b) the Depositary
Shares evidenced by such Receipt, (c) the Stock (or fractional interest therein)
or other property represented by such Depositary Shares, or (d) any transaction
referred to in Section 4.06, such tax (including transfer, issuance or
acquisition taxes, if any) or governmental charge shall be payable by the holder
of such Receipt, who shall pay the amount thereof to the Depositary. Until such
payment is made, registration of transfer of any Receipt or any split-up or
combination thereof or any withdrawal of the Stock or money or other property,
if any, represented by the Depositary Shares evidenced

10
<PAGE>

by such Receipt may be refused, any dividend or other distribution may be
withheld and any part or all of the Stock or other property (including Common
Stock received in connection with a conversion or redemption of Stock)
represented by the Depositary Shares evidenced by such Receipt may be sold for
the account of the holder thereof (after attempting by reasonable means to
notify such holder prior to such sale). Any dividend or other distribution so
withheld and the proceeds of any such sale may be applied to any payment of such
tax or other governmental charge, the holder of such Receipt remaining liable
for any deficiency.

SECTION 3.03. WITHHOLDING.

The Depositary shall act as the tax withholding agent for any
payments, distributions and exchanges made with respect to the Depositary Shares
and Receipts, and the Stock, Common Stock or other securities or assets
represented thereby (collectively, the "Securities"). The Depositary shall be
responsible with respect to the Securities for the timely (a) collection and
deposit of any required withholding or backup withholding tax, and (b) filing of
any information returns or other documents with federal (and other applicable)
taxing authorities.

SECTION 3.04. REPRESENTATIONS AND WARRANTIES AS TO STOCK.

In the case of the initial deposit of the Stock, the Company and, in
the case of subsequent deposits thereof, each person so depositing Stock under
this Deposit Agreement shall be deemed thereby to represent and warrant that
such Stock and each certificate therefor are valid and that the person making
such deposit is duly authorized to do so. Such representations and warranties
shall survive the deposit of the Stock and the issuance of Receipts therefor.

ARTICLE IV

THE STOCK, NOTICES

SECTION 4.01. CASH DISTRIBUTIONS.

Whenever the Depositary shall receive any cash dividend or other cash
distribution on the Stock, the Depositary shall, subject to Section 3.02,
distribute to record holders of Receipts on the record date fixed pursuant to
Section 4.04 such amounts of such sum as are, as nearly as practicable, in
proportion to the respective numbers of Depositary Shares evidenced by the
Receipts held by such holders; provided, however, that in case the Company or
the Depositary shall be required by law to withhold and does withhold from any
cash dividend or other cash distribution in respect of the Stock an amount on
account of taxes, the amount made available for distribution or distributed in
respect of Depositary Shares shall be reduced accordingly. The Depositary shall
distribute or make available for distribution, as the case may be, only such
amount, however, as can be distributed without attributing to any owner of
Depositary Shares a fraction of one cent and any balance not so distributable
shall be held by the Depositary (without

11
<PAGE>

liability for interest thereon) and shall be added to and be treated as part of
the next sum received by the Depositary for distribution to record holders of
Receipts then outstanding.

SECTION 4.02. DISTRIBUTIONS OTHER THAN CASH.

Whenever the Depositary shall receive any distribution other than
cash, rights, preferences or privileges upon the Stock, the Depositary shall,
subject to Section 3.02, distribute to record holders of Receipts on the record
date fixed pursuant to Section 4.04 such amounts of the securities or property
received by it as are, as nearly as practicable, in proportion to the respective
numbers of Depositary Shares evidenced by the Receipts held by such holders, in
any manner that the Depositary and the Company may deem equitable and
practicable for accomplishing such distribution. If, in the opinion of the
Depositary after consultation with the Company, such distribution cannot be made
proportionately among such record holders, or if for any other reason (including
any tax withholding or securities law requirement), the Depositary deems, after
consultation with the Company, such distribution not to be feasible, the
Depositary may, with the approval of the Company which approval shall not be
unreasonably withheld, adopt such method as it deems equitable and practicable
for the purpose of effecting such distribution, including the sale (at public or
private sale) of the securities or property thus received, or any part thereof,
at such place or places and upon such terms as it may deem proper. The net
proceeds of any such sale shall, subject to Section 3.02, be distributed or made
available for distribution, as the case may be, by the Depositary to record
holders of Receipts as provided by Section 4.01 in the case of a distribution
received in cash.

SECTION 4.03. SUBSCRIPTION RIGHTS, PREFERENCES OR PRIVILEGES.

If the Company shall at any time offer or cause to be offered to the
persons in whose names Stock is registered on the books of the Company any
rights, preferences or privileges to subscribe for or to purchase any securities
or any rights, preferences or privileges of any other nature, such rights,
preferences or privileges shall in each such instance be made available by the
Depositary to the record holders of Receipts in such manner as the Company shall
instruct (including by the issue to such record holders of warrants representing
such rights, preferences or privileges); provided, however, that (a) if at the
time of issue or offer of any such rights, preferences or privileges the Company
determines and instructs the Depositary that it is not lawful or feasible to
make such rights, preferences or privileges available to some or all holders of
Receipts (by the issue of warrants or otherwise) or (b) if and to the extent
instructed by holders of Receipts who do not desire to exercise such rights,
preferences or privileges, the Depositary shall then, in each case, and if
applicable laws or the terms of such rights, preferences or privileges so
permit, sell such rights, preferences or privileges of such holders at public or
private sale, at such place or places and upon such terms as it may deem proper.
The net proceeds of any such sale shall be distributed by the Depositary to the
record holders of Receipts entitled thereto as provided by Section 4.01 in the
case of a distribution received in cash.

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<PAGE>

If registration under the Securities Act of the securities to which
any rights, preferences or privileges relate is required in order for holders of
Receipts to be offered or sold such securities, the Company shall promptly file
a registration statement pursuant to the Securities Act with respect to such
securities and use its best efforts and take all steps available to it to cause
such registration statement to become effective sufficiently in advance of the
expiration of such rights, preferences or privileges to enable such holders to
exercise such rights, preferences or privileges. In no event shall the
Depositary make available to the holders of Receipts any right, preference or
privilege to subscribe for or to purchase any securities unless and until such
registration statement shall have become effective or unless the offering and
sale of such securities to such holders are exempt from registration under the
provisions of the Securities Act.

If any other action under the law of any jurisdiction or any
governmental or administrative authorization, consent or permit is required in
order for such rights, preferences or privileges to be made available to holders
of Receipts, the Company agrees with the Depositary that the Company will use
its reasonable best efforts to take such action or obtain such authorization,
consent or permit sufficiently in advance of the expiration of such rights,
preferences or privileges to enable such holders to exercise such rights,
preferences or privileges.

SECTION 4.04. NOTICE OF DIVIDENDS, FIXING OF RECORD DATE FOR HOLDERS
OF RECEIPTS.

Whenever (a) any cash dividend or other cash distribution shall become
payable, or any distribution other than cash shall be made, or any rights,
preferences or privileges shall at any time be offered, with respect to the
Stock, or (b) the Depositary shall receive notice of any meeting at which
holders of Stock are entitled to vote or of which holders of Stock are entitled
to notice or of the mandatory conversion of, or any election on the part of the
Company to call for the redemption of, any shares of Stock, the Depositary shall
in each such instance fix a record date (which shall be the same date as the
record date fixed by the Company with respect to the Stock) for the
determination of the holders of Receipts (i) who shall be entitled to receive
such dividend, distribution, rights, preferences or privileges or the net
proceeds of the sale thereof, or (ii) who shall be entitled to give instructions
for the exercise of voting rights at any such meeting or to receive notice of
such meeting or of such conversion or redemption.

SECTION 4.05. VOTING RIGHTS.

Upon receipt of notice of any meeting at which the holders of Stock
are entitled to vote, the Depositary shall, as soon as practicable thereafter,
mail to the record holders of Receipts a notice, which shall be provided by the
Company and which shall contain (a) such information as is contained in such
notice of meeting, (b) a statement that the holders of Receipts at the close of
business on a specified record date fixed pursuant to Section 4.04 will be
entitled, subject to any applicable provision of law, the Articles of
Incorporation or the Certificate of Determination, to instruct the Depositary as
to the exercise of the voting rights pertaining to the Stock repre-

13
<PAGE>

sented by their respective Depositary Shares and (c) a brief statement as
to the manner in which such instructions may be given. Upon the written request
of a holder of a Receipt on such record date, the Depositary shall endeavor
insofar as practicable to vote or cause to be voted the Stock represented by the
Depositary Shares evidenced by such Receipt in accordance with the instructions
set forth in such request. The Company hereby agrees to take all reasonable
action that may be deemed necessary by the Depositary in order to enable the
Depositary to vote such Stock or cause such Stock to be voted. In the absence
of specific instructions from the holder of a Receipt, the Depositary will
abstain from voting to the extent of the Stock represented by the Depositary
Shares evidenced by such Receipt.

SECTION 4.06. CHANGES AFFECTING STOCK AND RECLASSIFICATIONS,
RECAPITALIZATIONS, ETC.

Upon any split-up, consolidation or any other reclassification of
Stock, or upon any recapitalization, reorganization, merger, amalgamation or
consolidation affecting the Company or to which it is a party (other than a
Merger or Consolidation) or sale of all or substantially all of the Company's
assets, the Depositary shall treat any shares of stock or other securities or
property (including cash) that shall be received by the Depositary in exchange
for or upon conversion of or in respect of the Stock as new deposited property
under this Deposit Agreement, and Receipts then outstanding shall thenceforth
represent the proportionate interests of holders thereof in the new deposited
property so received in exchange for or upon conversion or in respect of such
Stock. In any such case the Depositary may, in its discretion, with the
approval of the Company, execute and deliver additional Receipts, or may call
for the surrender of all outstanding Receipts to be exchanged for new Receipts
specifically describing such new deposited property.

SECTION 4.07. REPORTS.

The Depositary shall make available for inspection by holders of
Receipts at the Corporate Office, the New York Office and at such other places
as it may from time to time deem advisable during normal business hours any
reports and communications received from the Company that are received by the
Depositary as the holder of Stock.

SECTION 4.08. LISTS OF RECEIPT HOLDERS.

Promptly upon request from time to time by the Company, the Depositary
shall furnish to it a list, as of a recent date, of the names, addresses and
holdings of Depositary Shares of all persons in whose names Receipts are
registered on the books of the Depositary. At the expense of the Company, the
Company shall have the right to inspect transfer and registration records of the
Depositary, any Depositary's Agent or the Registrar, take copies thereof and
require the Depositary, any Depositary's Agent or the Registrar to supply copies
of such portions of such records as the Company may request.

14
<PAGE>

ARTICLE V

THE DEPOSITARY, THE DEPOSITARY'S AGENTS,
THE REGISTRAR AND THE COMPANY

SECTION 5.01. MAINTENANCE OF OFFICES, AGENCIES, TRANSFER BOOKS BY THE
DEPOSITARY; THE REGISTRAR.

Upon execution of this Deposit Agreement in accordance with its terms,
the Depositary shall maintain (a) at the New York Office facilities for the
execution and delivery, registration, registration of transfer, surrender and
exchange, split-up, combination, redemption and conversion of Receipts and
deposit and withdrawal of Stock and (b) at the Corporate Office and at the
offices of the Depositary's Agents, if any, facilities for the delivery,
registration, registration of transfer, surrender and exchange, split-up,
combination, conversion and redemption of Receipts and deposit and withdrawal of
Stock, all in accordance with the provisions of this Deposit Agreement.

The Depositary shall keep books at the Corporate Office for the
registration and transfer of Receipts, which books at all reasonable times shall
be open for inspection by the record holders of Receipts; provided that any such
holder requesting to exercise such right shall certify to the Depositary that
such inspection shall be for a proper purpose reasonably related to such
person's interest as an owner of Depositary Shares. The Depositary shall
consult with the Company upon receipt of any request for inspection. The
Depositary may close such books, at any time or from time to time, when deemed
expedient by it in connection with the performance of its duties hereunder.

If the Receipts or the Depositary Shares evidenced thereby or the
Stock represented by such Depositary Shares shall be listed on one or more stock
exchanges, the Depositary shall, with the approval of the Company, appoint a
Registrar for registry of such Receipts or Depositary Shares in accordance with
the requirements of such exchange or exchanges. Such Registrar (which may be
the Depositary if so permitted by the requirements of such exchange or
exchanges) may be removed and a substitute registrar appointed by the Depositary
upon the request or with the approval of the Company. In addition, if the
Receipts, such Depositary Shares or such Stock are listed on one or more stock
exchanges, the Depositary will, at the request of the Company, arrange such
facilities for the delivery, registration, registration of transfer, surrender
and exchange, split-up, combination, redemption or conversion of such Receipts,
such Depositary Shares or such Stock as may be required by law or applicable
stock exchange regulations.

SECTION 5.02. PREVENTION OR DELAY IN PERFORMANCE BY THE DEPOSITARY,
THE DEPOSITARY'S AGENTS, THE REGISTRAR OR THE COMPANY.

15
<PAGE>

Neither the Depositary nor any Depositary's Agent nor the Registrar
nor the Company shall incur any liability to any holder of any Receipt, if by
reason of any provision of any present or future law or regulation thereunder of
the United States of America or of any other governmental authority or, in the
case of the Depositary, the Registrar or any Depositary's Agent, by reason of
any provision, present or future, of the Articles of Incorporation or the
Certificate of Determination or, in the case of the Company, the Depositary, the
Registrar or any Depositary's Agent, by reason of any act of God or war or other
circumstances beyond the control of the relevant party, the Depositary, any
Depositary's Agent, the Registrar or the Company shall be prevented or forbidden
from doing or performing any act or thing that the terms of this Deposit
Agreement provide shall be done or performed; nor shall the Depositary, any
Depositary's Agent, the Registrar or the Company incur any liability to any
holder of a Receipt (a) by reason of any nonperformance or delay, caused as
aforesaid, in the performance of any act or thing that the terms of this Deposit
Agreement provide shall or may be done or performed, or (b) by reason of any
exercise of, or failure to exercise, any discretion provided for in this Deposit
Agreement except, in the case of the Depositary, any Depositary's Agent or the
Registrar, if any such exercise or failure to exercise discretion is caused by
its negligence or bad faith.

SECTION 5.03. OBLIGATIONS OF THE DEPOSITARY, THE DEPOSITARY'S AGENTS,
THE REGISTRAR AND THE COMPANY.

The Company assumes no obligation and shall be subject to no liability
under this Deposit Agreement or the Receipts to holders or other persons, except
to perform in good faith such obligations as are specifically set forth and
undertaken by it to perform in this Deposit Agreement. Each of the Depositary,
the Depositary's Agents and the Registrar assumes no obligation and shall be
subject to no liability under this Deposit Agreement or the Receipts to holders
or other persons, except to perform such obligations as are specifically set
forth and undertaken by it to perform in this Deposit Agreement without
negligence or bad faith.

Neither the Depositary nor any Depositary's Agent nor the Registrar
nor the Company shall be under any obligation to appear in, prosecute or defend
any action, suit or other proceeding with respect to Stock, Depositary Shares,
Receipts or Common Stock that in its opinion may involve it in expense or
liability, unless indemnity satisfactory to it against all expense and liability
be furnished as often as may be required.

Neither the Depositary nor any Depositary's Agent nor the Registrar
nor the Company shall be liable for any action or any failure to act by it in
reliance upon the advice of or information from legal counsel, accountants, any
person presenting Stock for deposit, any holder of a Receipt or any other person
believed by it in good faith to be competent to give such advice or information.
The Depositary, any Depositary's Agent, the Registrar and the Company may each
rely and shall each be protected in acting upon any written notice, request,
direction or other document believed by it to be genuine and to have been signed
or presented by the proper party or parties.

16
<PAGE>

The Depositary, the Registrar and any Depositary's Agent may own and
deal in any class of securities of the Company and its affiliates and in
Receipts or Depositary Shares. The Depositary may also act as transfer agent or
registrar of any of the securities of the Company and its affiliates.

It is intended that neither the Depositary nor any Depositary's Agent
shall be deemed to be an "issuer" of the Stock, the Depositary Shares, the
Receipts or the Common Stock issued upon conversion or redemption of the Stock
under the federal securities laws or applicable state securities laws, it being
expressly understood and agreed that the Depositary and any Depositary's Agent
are acting only in a ministerial capacity as Depositary for the Stock; provided,
however, that the Depositary agrees to comply with all information reporting and
withholding requirements applicable to it under law or this Deposit Agreement in
its capacity as Depositary.

Neither the Depositary (or its officers, directors, employees or
agents) nor any Depositary's Agent makes any representation or has any
responsibility as to the validity of the Registration Statement pursuant to
which the Depositary Shares are registered under the Securities Act, the Stock,
the Depositary Shares or any instruments referred to therein or herein, or as to
the correctness of any statement made therein or herein; provided, however, that
the Depositary is responsible for its representations in this Deposit Agreement.

The Depositary assumes no responsibility for the correctness of the
description that appears in the Receipts, which can be taken as a statement of
the Company summarizing certain provisions of this Deposit Agreement.
Notwithstanding any other provision herein or in the Receipts, the Depositary
makes no warranties or representations as to the validity, genuineness or
sufficiency of any Stock at any time deposited with the Depositary hereunder or
of the Depositary Shares, as to the validity or sufficiency of this Deposit
Agreement, as to the value of the Depositary Shares or as to any right, title or
interest of the record holders of Receipts in and to the Depositary Shares
except that the Depositary hereby represents and warrants as follows: (a) the
Depositary has been duly organized and is validly existing and in good standing
under the laws of the State of ____________, with full power, authority and
legal right under such law to execute, deliver and carry out the terms of this
Deposit Agreement; (b) this Deposit Agreement has been duly authorized, executed
and delivered by the Depositary; and (c) this Deposit Agreement constitutes a
valid and binding obligation of the Depositary, enforceable against the
Depositary in accordance with its terms, except as enforcement thereof may be
limited by bankruptcy, insolvency, reorganization or other similar laws
affecting enforcement of creditors' rights generally and except as enforcement
thereof is subject to general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law). The Depositary
shall not be accountable for the use or application by the Company of the
Depositary Shares or the Receipts or the proceeds thereof.

SECTION 5.04. RESIGNATION AND REMOVAL OF THE DEPOSITARY, APPOINTMENT
OF SUCCESSOR DEPOSITARY.

17
<PAGE>

The Depositary may at any time resign as Depositary hereunder by
written notice via registered mail of its election to do so delivered to the
Company, such resignation to take effect upon the appointment of a successor
depositary and its acceptance of such appointment as hereinafter provided.

The Depositary may at any time be removed by the Company by written
notice of such removal delivered to the Depositary, such removal to take effect
upon the appointment of a successor depositary and its acceptance of such
appointment as hereinafter provided.

In case at any time the Depositary acting hereunder shall resign or be
removed, the Company shall, within 60 days after the delivery of the notice of
resignation or removal, as the case may be, appoint a successor depositary,
which shall be a bank or trust company, or an affiliate of a bank or trust
company, having its principal office in the United States of America and having
a combined capital and surplus of at least $50,000,000. If a successor
depositary shall not have been appointed in 60 days, the resigning or removed
Depositary may petition a court of competent jurisdiction to appoint a successor
depositary. Every successor depositary shall execute and deliver to its
predecessor and to the Company an instrument in writing accepting its
appointment hereunder, and thereupon such successor depositary, without any
further act or deed, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor and for all purposes shall be the
Depositary under this Deposit Agreement, and such predecessor, upon payment of
all sums due it and on the written request of the Company, shall promptly
execute and deliver an instrument transferring to such successor all rights and
powers of such predecessor hereunder, shall duly assign, transfer and deliver
all rights, title and interest in the Stock and any moneys or property held
hereunder to such successor and shall deliver to such successor a list of the
record holders of all outstanding Receipts. Any successor depositary shall
promptly mail notice of its appointment to the record holders of Receipts.

Any corporation into or with which the Depositary may be merged,
consolidated or converted shall be the successor of such Depositary without the
execution or filing of any document or any further act. Such successor
depositary may execute the Receipts either in the name of the predecessor
depositary or in the name of the successor depositary.

SECTION 5.05. CORPORATE NOTICES AND REPORTS.

The Company agrees that it will deliver to the Depositary, and the
Depositary will, promptly after receipt thereof, transmit to the record holders
of Receipts, in each case at the address recorded in the Depositary's books,
copies of all notices and reports (including financial statements) required by
law, by the rules of any national securities exchange upon which the Stock, the
Depositary Shares or the Receipts are listed or by the Articles of Incorporation
and the Certificate of Determination to be furnished by the Company to holders
of Stock. Such transmission will be at the Company's expense and the Company
will provide the Depositary with such number of copies of such documents as the
Depositary may reasonably request. In addition, the

18
<PAGE>

Depositary will transmit to the record holders of Receipts at the Company's
expense such other documents as may be requested by the Company.

SECTION 5.06. DEPOSIT OF STOCK BY THE COMPANY.

The Company agrees with the Depositary that neither the Company nor
any company controlled by the Company will at any time deposit any Stock if such
Stock is required to be registered under the provisions of the Securities Act
and no registration statement is at such time in effect as to such Stock.

SECTION 5.07. INDEMNIFICATION BY THE COMPANY.

The Company agrees to indemnify the Depositary, any Depositary's Agent
and any Registrar against, and hold each of them harmless from, any liability,
costs and expenses (including reasonable fees and expenses of counsel) that may
arise out of or in connection with its acting as Depositary, Depositary's Agent
or Registrar, respectively, under this Deposit Agreement and the Receipts,
except for any liability arising out of negligence, bad faith or willful
misconduct on the part of any such person or persons.

SECTION 5.08. FEES, CHARGES AND EXPENSES.

No fees, charges and expenses of the Depositary or any Depositary's
Agent hereunder or of any Registrar shall be payable by any person other than
the Company, except for any taxes and other governmental charges and except as
provided in this Deposit Agreement. If, at the request of a holder of a
Receipt, the Depositary incurs fees, charges or expenses for which it is not
otherwise liable hereunder, such holder or other person will be liable for such
fees, charges and expenses. All other fees, charges and expenses of the
Depositary and any Depositary's Agent hereunder and of any Registrar (including,
in each case, reasonable fees and expenses of counsel) incident to the
performance of their respective obligations hereunder will be paid from time to
time upon consultation and agreement between the Depositary and the Company as
to the amount and nature of such fees, charges and expenses.

ARTICLE VI

AMENDMENT AND TERMINATION

SECTION 6.01. AMENDMENT.

The form of the Receipts and any provision of this Deposit Agreement
may at any time and from time to time be amended by agreement between the
Company and the Depositary in any respect that they may deem necessary or
desirable. Any amendment that shall impose or increase any fees, taxes or
charges payable by holders of Receipts (other than taxes and other

19
<PAGE>

governmental charges, fees and other expenses payable by holders pursuant to the
terms hereof or of the Receipts), or that otherwise prejudices any substantial
existing right of holders of Receipts, shall not become effective as to
outstanding Receipts until the expiration of 30 days after notice of such
amendment shall have been mailed to the record holders of outstanding Receipts.
Every holder of an outstanding Receipt at the time any such amendment becomes
effective shall be deemed, by continuing to hold such Receipt, to consent and
agree to such amendment and to be bound by this Deposit Agreement as amended
thereby. In no event shall any amendment impair the right, subject to the
provisions of Sections 2.04, 2.07 and 2.08 and Article III, of any owner of any
Depositary Shares to surrender the Receipt evidencing such Depositary Shares
with instructions to the Depositary to deliver to the holder the Stock and all
money and other property, if any, represented thereby, except in order to comply
with mandatory provisions of applicable law.

SECTION 6.02. TERMINATION.

Whenever so directed by the Company, the Depositary will terminate
this Deposit Agreement by mailing notice of such termination to the record
holders of all Receipts then outstanding at least 30 days prior to the date
fixed in such notice for such termination. The Depositary may likewise
terminate this Deposit Agreement if at any time 90 days shall have expired after
the Depositary shall have delivered to the Company a written notice of its
election to resign and a successor depositary shall not have been appointed and
accepted its appointment as provided in Section 5.04. In either case, on a date
not less than 90 days after such notice, the Depositary shall deliver or make
available for delivery to holders of Receipts, upon surrender of such Receipts
evidencing Depositary Shares, such number of whole or fractional shares of the
Stock as are represented by the Depositary Shares.

This Deposit Agreement shall automatically terminate after all
outstanding Depositary Shares have been redeemed or there has been a final
distribution in respect of the Stock in connection with any liquidation,
dissolution or winding up of the Company and such distribution has been
distributed to the holders of the Receipts.

If any Receipts shall remain outstanding after the date of termination
of this Deposit Agreement, the Depositary thereafter shall discontinue the
transfer of Receipts, shall suspend the distribution of dividends to the holders
thereof and shall not give any further notices (other than notice of such
termination) or perform any further acts under this Deposit Agreement, except as
provided below and that the Depositary shall continue to collect dividends and
other distributions pertaining to Stock, shall sell rights, preferences or
privileges as provided in this Deposit Agreement and shall continue to deliver
the Stock and any money and other property represented by Receipts, without
liability for interest thereon, upon surrender thereof by the holders thereof.
At any time after the expiration of two years from the date of termination, the
Depositary may sell Stock then held hereunder at public or private sale, at such
places and upon such terms as it deems proper and may thereafter hold in a
segregated account the net proceeds of any such sale, together with any money
and other property held by it hereunder, without liability

20
<PAGE>

for interest, for the benefit, pro rata in accordance with their holdings, of
the holders of Receipts that have not heretofore been surrendered. After making
such sale, the Depositary shall be discharged from all obligations under this
Deposit Agreement except to account for such net proceeds and money and other
property. Upon the termination of this Deposit Agreement, the Company shall be
discharged from all obligations under this Deposit Agreement except for its
obligations to the Depositary, any Depositary's Agent and any Registrar under
Sections 5.07 and 5.08.

ARTICLE VII

MISCELLANEOUS

SECTION 7.01. COUNTERPARTS.

This Deposit Agreement may be executed by the Company and the
Depositary in separate counterparts, each of which counterparts, when so
executed and delivered, shall be deemed an original, but all such counterparts
taken together shall constitute one and the same instrument. Delivery of an
executed counterpart of a signature page to this Deposit Agreement by telecopier
shall be effective as delivery of a manually executed counterpart of this
Deposit Agreement. Copies of this Deposit Agreement shall be filed with the
Depositary and the Depositary's Agents and shall be open to inspection during
business hours at the Corporate Office and the New York Office and the
respective offices of the Depositary's Agents, if any, by any holder of a
Receipt.

SECTION 7.02. EXCLUSIVE BENEFITS OF PARTIES.

This Deposit Agreement is for the exclusive benefit of the parties
hereto, and their respective successors hereunder, and shall not be deemed to
give any legal or equitable right, remedy or claim to any other person
whatsoever.

SECTION 7.03. INVALIDITY OF PROVISIONS.

In case any one or more of the provisions contained in this Deposit
Agreement or in the Receipts should be or become invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein or therein shall in no way be affected,
prejudiced or disturbed thereby.

21
<PAGE>

SECTION 7.04. NOTICES.

Any notices to be given to the Company hereunder or under the Receipts
shall be in writing and shall be deemed to have been duly given if personally
delivered or sent by mail, or by telegram or telex or telecopier confirmed by
letter, addressed to the Company at 400 California Street, San Francisco,
California 94104, Attention: General Counsel, or at any other place to which the
Company may have transferred its principal executive office.

Any notices to be given to the Depositary hereunder or under the
Receipts shall be in writing and shall be deemed to have been duly given if
personally delivered or sent by mail, or by telegram or telex or telecopier
confirmed by letter, addressed to the Depositary at the Corporate Office.

Any notices given to any record holder of a Receipt hereunder or under
the Receipts shall be in writing and shall be deemed to have been duly given if
personally delivered or sent by mail, or by telegram or telex or telecopier
confirmed by letter, addressed to such record holder at the address of such
record holder as it appears on the books of the Depositary or, if such holder
shall have filed with the Depositary a written request that notices intended for
such holder be mailed to some other address, at the address designated in such
request.

Delivery of a notice sent by mail, or by telegram or telex or
telecopier shall be deemed to be effected at the time when a duly addressed
letter containing the same (or a duly addressed letter confirming an earlier
notice in the case of a telegram or telex or telecopier message) is deposited,
postage prepaid, in a post office letter box. The Depositary or the Company
may, however, act upon any telegram or telex or telecopier message received by
it from the other or from any holder of a Receipt, notwithstanding that such
telegram or telex or telecopier message shall not subsequently be confirmed by
letter as aforesaid.

SECTION 7.05. DEPOSITARY'S AGENTS.

The Depositary may, with the approval of the Company which approval
shall not be unreasonably withheld, from time to time appoint one or more
Depositary's Agents to act in any respect for the Depositary for the purposes of
this Deposit Agreement and may vary or terminate the appointment of such
Depositary's Agents.

SECTION 7.06. HOLDERS OF RECEIPTS ARE PARTIES.

Notwithstanding that holders of Receipts have not executed and
delivered this Deposit Agreement or any counterpart thereof, the holders of
Receipts from time to time shall be deemed to be parties to this Deposit
Agreement and shall be bound by all of the terms and conditions, and be entitled
to all of the benefits, hereof and of the Receipts by acceptance of delivery of
Receipts.

22
<PAGE>

SECTION 7.07. GOVERNING LAW.

THIS DEPOSIT AGREEMENT AND THE RECEIPTS AND ALL RIGHTS HEREUNDER AND
THEREUNDER AND PROVISIONS HEREOF AND THEREOF SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK, INCLUDING, WITHOUT
LIMITATION, SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.

SECTION 7.08. HEADINGS.

The headings of articles and sections in this Deposit Agreement and in
the form of the Receipt set forth in Exhibit A hereto have been inserted for
convenience only and are not to be regarded as a part of this Deposit Agreement
or to have any bearing upon the meaning or interpretation of any provision
contained herein or in the Receipts.

23
<PAGE>

IN WITNESS WHEREOF, UnionBanCal Corporation and ________________
have duly executed this Deposit Agreement as of the day and year first above set
forth and all holders of Receipts shall become parties hereto by and upon
acceptance by them of delivery of Receipts issued in accordance with the terms
hereof.

UNIONBANCAL CORPORATION

Attest:

By:_______________________ By:___________________________
Name:
Title:

Attest:

By:_______________________ By:___________________________
Name:
Title:

24
<PAGE>

EXHIBIT A

DEPOSITARY RECEIPT
FOR
DEPOSITARY SHARES
EACH REPRESENTING ______________ OF A SHARE OF
_______________ SERIES PREFERRED
STOCK

UNIONBANCAL CORPORATION
(Incorporated under the Laws of the State of California)

No.

_________________________________ (the "Depositary") hereby
certifies that ____________ is the registered owner of ___________ Depositary
Shares (the "Depositary Shares"), each Depositary Share representing
______________ of a share of ____________________________ Preferred Stock (the
"Stock"), of UnionBanCal Corporation, a corporation duly organized and existing
under the laws of the State of California (the "Company"), and the same
proportionate interest in any and all other property received by the Depositary
in respect of such shares of Stock and held by the Depositary under the Deposit
Agreement (as defined below). Subject to the terms of the Deposit Agreement,
each owner of a Depositary Share is entitled, proportionately, to all the
rights, preferences and privileges of the Stock represented thereby, including
the dividend, voting, liquidation and other rights contained in the Certificate
of Determination establishing the rights, preferences, privileges and
limitations of the Stock (the "Certificate of Determination"), copies of which
are on file at the office of the Depositary at which at any particular time its
business in respect of matters governed by the Deposit Agreement shall be
administered, which at the time of the execution of the Deposit Agreement is
located at ________________, ______________, ____ ______ (the "Corporate
Office").

This Depositary Receipt ("Receipt") shall not be entitled to any
benefits under the Deposit Agreement or be valid or obligatory for any purpose
unless this Receipt shall have been executed manually or, if a Registrar for the
Receipts (other than the Depositary) shall have been appointed, by facsimile by
the Depositary by the signature of a duly authorized signatory and, if executed
by facsimile signature of the Depositary, shall have been countersigned manually
by such Registrar by the signature of a duly authorized signatory.

THE DEPOSITARY IS NOT RESPONSIBLE FOR THE VALIDITY OF ANY DEPOSITED STOCK. THE
DEPOSITARY ASSUMES NO RESPONSIBILITY FOR THE CORRECTNESS OF THE DESCRIPTION SET
FORTH IN THIS RECEIPT, WHICH CAN BE TAKEN AS A

A-1
<PAGE>

STATEMENT OF THE COMPANY SUMMARIZING CERTAIN PROVISIONS OF THE DEPOSIT
AGREEMENT. UNLESS EXPRESSLY SET FORTH IN THE DEPOSIT AGREEMENT, THE DEPOSITARY
MAKES NO WARRANTIES OR REPRESENTATIONS AS TO THE VALIDITY, GENUINENESS OR
SUFFICIENCY OF ANY STOCK AT ANY TIME DEPOSITED WITH THE DEPOSITARY UNDER THE
DEPOSIT AGREEMENT OR OF THE DEPOSITARY SHARES, AS TO THE VALIDITY OR SUFFICIENCY
OF THE DEPOSIT AGREEMENT, AS TO THE VALUE OF THE DEPOSITARY SHARES OR AS TO ANY
RIGHT, TITLE OR INTEREST OF THE RECORD HOLDERS OF THE DEPOSITARY RECEIPTS IN AND
TO THE DEPOSITARY SHARES.

The Company will furnish to any holder of this Receipt without charge,
upon request addressed to its executive office, a full statement of the
designation, relative rights, preferences and limitations of the shares of each
authorized class, and of each class of preferred stock authorized to be issued,
so far as the same may have been fixed, and a statement of the authority of the
Board of Directors of the Company to designate and fix the relative rights,
preferences and limitations of other classes.

This Receipt is continued on the reverse hereof and the additional
provisions therein set forth for all purposes have the same effect as if set
forth at this place.

Dated:

____________________________,
as Depositary and Registrar

By:___________________________
Authorized Signatory

A-2
<PAGE>

[FORM OF REVERSE
OF DEPOSITARY RECEIPT]

1. THE DEPOSIT AGREEMENT. Depositary Receipts (the "Receipts"), of which
this Receipt is one, are made available upon the terms and conditions set forth
in the Deposit Agreement, dated as of _________ ____, _____ (the "Deposit
Agreement"), among the Company, the Depositary and all holders from time to time
of Receipts. The Deposit Agreement (copies of which are on file at the
Corporate Office, the office maintained by the Depositary in the Borough of
Manhattan, The City of New York, which at the time of the execution of the
Deposit Agreement is located at ________________________ (the "New York Office")
and at the office of any agent of the Depositary) sets forth the rights of
holders of Receipts and the rights and duties of the Depositary. The statements
made on the face and the reverse of this Receipt are summaries of certain
provisions of the Deposit Agreement and are subject to the detailed provisions
thereof, to which reference is hereby made. In the event of any conflict
between the provisions of this Receipt and the provisions of the Deposit
Agreement, the provisions of the Deposit Agreement will govern.

2. DEFINITIONS. Unless otherwise expressly herein provided, all defined
terms used herein shall have the meanings ascribed thereto in the Deposit
Agreement.

3. REDEMPTION AND CONVERSION OF STOCK.(3) Whenever the Company shall
elect to redeem or be required to convert shares of Stock into shares of Common
Stock in accordance with the Certificate of Determination, it shall (unless
otherwise agreed in writing with the Depositary) give the Depositary in its
capacity as Depositary not less than 5 business days' prior notice of the
proposed date of the mailing of a notice of redemption or conversion of Stock
and the simultaneous redemption or conversion of the Depositary Shares
representing the Stock to be redeemed or converted and of the number of such
shares of Stock held by the Depositary to be redeemed or converted. The
Depositary shall, as directed by the Company in writing, mail, first class
postage prepaid, notice of the redemption or conversion of Stock and the
proposed simultaneous redemption or conversion of Depositary Shares representing
the Stock to be redeemed or converted, not less than 30 and not more than 60
days prior to the date fixed for redemption or conversion of such Stock and
Depositary Shares, to the record holders of the Receipts evidencing the
Depositary Shares to be so redeemed or converted, at the addresses of such
holders as the same appear on the records of the Depositary; provided, that if
the effectiveness of a Merger or Consolidation (as defined in the Certificate of
Determination) makes it impracticable to provide at least 30 days' notice, the
Depositary shall provide such notice as soon as practicable prior to such
effectiveness. Any such notice shall also be published in the same manner as
notices of redemption or conversion of the Stock are required to be published
pursuant to the Certificate of Determination. On the date of any such
redemption or conversion, the

- -----------------------

(3) This section to be modified to discuss specific redemption or
conversion terms of the Stock, if any.

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<PAGE>

Depositary shall surrender the certificate or certificates held by the
Depositary evidencing the number of shares of Stock to be redeemed or converted
in the manner specified in the notice of redemption or conversion of Stock
provided by the Company pursuant to the Certificate of Determination. The
Depositary shall, thereafter, redeem or convert the number of Depositary Shares
representing such redeemed or converted Stock upon the surrender of Receipts
evidencing such Depositary Shares in the manner provided in the notice sent to
record holders of Receipts; provided, that the Depositary shall have received,
upon surrendering such certificate or certificates as aforesaid, a sufficient
number of shares of Common Stock to convert or redeem such number of Depositary
Shares (including, in the event that the Company elects pursuant to the
Certificate of Determination to exercise any option to deliver shares of Common
Stock in lieu of any cash consideration payable on the Effective Date (as
defined in the Certificate of Determination) of any Merger or Consolidation, a
number of shares of Common Stock equal to such cash consideration (as determined
in the manner set forth in the Certificate of Determination)), plus any accrued
and unpaid dividends payable with respect thereto to and including the date of
any such redemption or conversion and any other cash consideration payable on
the Effective Date of a Merger or Consolidation (other than any dividends or
other cash consideration payable on the Effective Date of a Merger or
Consolidation that the Company has elected to pay in shares of Common Stock
pursuant to the Certificate of Determination). In case fewer than all the
outstanding Depositary Shares are to be redeemed, the Depositary Shares to be
redeemed shall be selected by the Depositary by lot or on a pro rata basis.

Notice having been mailed and published as aforesaid, from and after the
redemption or conversion date (unless the Company shall have failed to redeem or
convert the shares of Stock to be redeemed or converted by it upon the surrender
of the certificate or certificates therefor by the Depositary as described
above), the Depositary Shares called for redemption or subject to conversion
shall be deemed no longer to be outstanding and all rights of the holders of
Receipts evidencing such Depositary Shares (except the right to receive the
shares of Common Stock and cash, if any, payable upon redemption or conversion
upon surrender of such Receipts) shall, to the extent of such Depositary Shares,
cease and terminate. Upon surrender in accordance with said notice of the
Receipts evidencing such Depositary Shares (properly endorsed or assigned for
transfer, if the Depositary shall so require), such Depositary Shares shall be
converted into or redeemed for shares of Common Stock at a rate equal to
______________ of the number of shares of Common Stock delivered, and the
holders thereof shall be entitled to ______________ of the cash, if any,
payable, in respect of the shares of Stock pursuant to the Certificate of
Determination. The foregoing is subject further to the terms and conditions of
the Certificate of Determination. If fewer than all of the Depositary Shares
evidenced by this Receipt are called for redemption, the Depositary will deliver
to the holder of this Receipt upon its surrender to the Depositary, together
with shares of Common Stock and all accrued and unpaid dividends to and
including the date fixed for redemption payable in respect of the Depositary
Shares called for redemption, a new Receipt evidencing the Depositary Shares
evidenced by such prior Receipt and not called for redemption.

A-4
<PAGE>

4. SURRENDER OF RECEIPTS AND WITHDRAWAL OF STOCK. Upon surrender of this
Receipt to the Depositary at the Corporate Office, the New York Office or at
such other offices as the Depositary may designate, and subject to the
provisions of the Deposit Agreement, the holder hereof is entitled to withdraw,
and to obtain delivery, without unreasonable delay, to or upon the order of such
holder, any or all of the Stock (but only in whole shares of Stock) and all
money and other property, if any, at the time represented by the Depositary
Shares evidenced by this Receipt; provided, however, that, in the event this
Receipt shall evidence a number of Depositary Shares in excess of the number of
Depositary Shares representing the whole number of shares of Stock to be
withdrawn, the Depositary shall, in addition to such whole number of shares of
Stock and such money and other property, if any, to be withdrawn, deliver, to or
upon the order of such holder, a new Receipt or Receipts evidencing such excess
number of whole Depositary Shares.

5. TRANSFERS, SPLIT-UPS, COMBINATIONS. Subject to Paragraphs 6, 7 and 8
below, this Receipt is transferable on the books of the Depositary upon
surrender of this Receipt to the Depositary at the Corporate Office or the New
York Office, or at such other offices as the Depositary may designate, properly
endorsed or accompanied by a properly executed instrument of transfer, and upon
such transfer the Depositary shall sign and deliver a Receipt or Receipts to or
upon the order of the person entitled thereto, all as provided in and subject to
the Deposit Agreement. This Receipt may be split into other Receipts or
combined with other Receipts into one Receipt evidencing the same aggregate
number of Depositary Shares evidenced by the Receipt or Receipts surrendered;
provided, however, that the Depositary shall not issue any Receipt evidencing a
fractional Depositary Share.

6. CONDITIONS TO SIGNING AND DELIVERY, TRANSFER, ETC., OF RECEIPTS. Prior
to the execution and delivery, registration of transfer, split-up, combination,
surrender or exchange of this Receipt, the delivery of any distribution hereon
or the withdrawal or deposit of Stock, the Depositary, any of the Depositary's
Agents or the Company may require any or all of the following: (a) payment to
it of a sum sufficient for the payment (or, in the event that the Depositary or
the Company shall have made such payment, the reimbursement to it) of any tax or
other governmental charge with respect thereto (including any such tax or charge
with respect to Stock being deposited or withdrawn or with respect to Common
Stock or other securities or property of the Company being issued upon
conversion or redemption); (b) production of proof satisfactory to it as to the
identity and genuineness of any signature and (c) compliance with such
reasonable regulations, if any, as the Depositary or the Company may establish
not inconsistent with the Deposit Agreement. Any person presenting Stock for
deposit, or any holder of this Receipt, may be required to file such proof of
information, to execute such certificates and to make such representations and
warranties as the Depositary or the Company may reasonably deem necessary or
proper. The Depositary or the Company may withhold or delay the delivery of
this Receipt, the registration of transfer, redemption, conversion or exchange
of this Receipt, the withdrawal of the Stock represented by the Depositary
Shares evidenced by this Receipt or the distribution of any dividend or other
distribution until such proof or other information is filed, such certificates
are executed or such representations and warranties are made.

A-5
<PAGE>

7. SUSPENSION OF DELIVERY, TRANSFER, ETC. The deposit of Stock may be
refused and the delivery of this Receipt against Stock or the registration of
transfer, split-up, combination, surrender or exchange of this Receipt and the
withdrawal of deposited Stock may be suspended (a) during any period when the
register of shareholders of the Company is closed, (b) if any such action is
deemed necessary or advisable by the Depositary, any of the Depositary's Agents
or the Company at any time or from time to time because of any requirement of
law or of any government or governmental body or commission, or under any
provision of the Deposit Agreement, or (c) with the approval of the Company, for
any other reason. The Depositary shall not be required (x) to issue, transfer
or exchange any Receipts for a period beginning at the opening of business 15
days next preceding any selection of Depositary Shares and Stock to be redeemed
and ending at the close of business on the day of the mailing of notice of
redemption of Depositary Shares or (y) to transfer or exchange for another
Receipt any Receipt evidencing Depositary Shares called or being called for
redemption, in whole or in part, or subject to conversion except as provided in
the last sentence of Paragraph 3.

8. PAYMENT OF TAXES OR OTHER GOVERNMENTAL CHARGES. If any tax or other
governmental charge shall become payable by or on behalf of the Depositary with
respect to (a) this Receipt, (b) the Depositary Shares evidenced by this
Receipt, (c) the Stock (or fractional interest therein) or other property
represented by such Depositary Shares, or (d) any transaction referred to in
Section 4.06 of the Deposit Agreement, such tax (including transfer, issuance or
acquisition taxes, if any) or governmental charge shall be payable by the holder
of this Receipt, who shall pay the amount thereof to the Depositary. Until such
payment is made, registration of transfer of this Receipt or any split-up or
combination hereof or any withdrawal of the Stock or money or other property, if
any, represented by the Depositary Shares evidenced by this Receipt may be
refused, any dividend or other distribution may be withheld and any part or all
of the Stock or other property (including Common Stock received in connection
with a conversion or redemption of Stock) represented by the Depositary Shares
evidenced by this Receipt may be sold for the account of the holder hereof
(after attempting by reasonable means to notify such holder prior to such sale).
Any dividend or other distribution so withheld and the proceeds of any such sale
may be applied to any payment of such tax or other governmental charge, the
holder of this Receipt remaining liable for any deficiency.

9. AMENDMENT. The form of the Receipts and any provision of the Deposit
Agreement may at any time and from time to time be amended by agreement between
the Company and the Depositary in any respect that they may deem necessary or
desirable. Any amendment that shall impose or increase any fees, taxes or
charges payable by holders of Receipts (other than taxes and other governmental
charges, fees and other expenses payable by holders as provided herein or in the
Deposit Agreement), or that shall otherwise prejudice any substantial existing
right of holders of Receipts, shall not become effective as to outstanding
Receipts until the expiration of 30 days after such notice of such amendment
shall have been given to the record holders of outstanding Receipts. The
holder of this Receipt at the time any such amendment becomes effective shall be
deemed, by continuing to hold this Receipt, to consent and agree to such
amendment and to be bound by the Deposit Agreement as amended thereby. In no
event shall

A-6
<PAGE>

any amendment impair the right, subject to the provisions of Paragraphs 3, 4, 6,
7 and 8 hereof and of Sections 2.04, 2.07 and 2.08 and Article III of the
Deposit Agreement, of the owner of the Depositary Shares evidenced by this
Receipt to surrender this Receipt with instructions to the Depositary to deliver
to the holder the Stock and all money and other property, if any, represented
thereby, except in order to comply with mandatory provisions of applicable law.

10. FEES, CHARGES AND EXPENSES. The Company will pay all fees, charges
and expenses of the Depositary, except for taxes (including transfer taxes, if
any) and other governmental charges and such charges as are expressly provided
in the Deposit Agreement to be at the expense of persons depositing Stock,
holders of Receipts or other persons.

11. TITLE TO RECEIPTS. It is a condition of this Receipt, and every
successive holder hereof by accepting or holding the same consents and agrees,
that title to this Receipt (and to the Depositary Shares evidenced hereby), when
properly endorsed or accompanied by a properly executed instrument of transfer,
is transferable by delivery with the same effect as in the case of a negotiable
instrument; provided, however, that the Depositary may, notwithstanding any
notice to the contrary, treat the record holder hereof at such time as the
absolute owner hereof for the purpose of determining the person entitled to
distribution of dividends or other distributions or to any notice provided for
in the Deposit Agreement and for all other purposes.

12. DIVIDENDS AND DISTRIBUTIONS. Whenever the Depositary shall receive
any cash dividend or other cash distribution on the Stock, the Depositary shall,
subject to the provisions of the Deposit Agreement, distribute to record holders
of Receipts such amounts of such sums as are, as nearly as practicable, in
proportion to the respective numbers of Depositary Shares evidenced by the
Receipts held by such holders; provided, however, that in case the Company or
the Depositary shall be required by law to withhold and does withhold from any
cash dividend or other cash distribution in respect of the Stock an amount on
account of taxes, the amount made available for distribution or distributed in
respect of Depositary Shares shall be reduced accordingly. The Depositary shall
distribute or make available for distribution, as the case may be, only such
amount, however, as can be distributed without attributing to any owner of
Depositary Shares a fraction of one cent and any balance not so distributable
shall be held by the Depositary (without liability for interest thereon) and
shall be added to and be treated as part of the next sum received by the
Depositary for distribution to record holders of Receipts then outstanding.

13. SUBSCRIPTION RIGHTS, PREFERENCES OR PRIVILEGES. If the Company shall
at any time offer or cause to be offered to the persons in whose name Stock is
registered on the books of the Company any rights, preferences or privileges to
subscribe for or to purchase any securities or any rights, preferences or
privileges of any other nature, such rights, preferences or privileges shall in
each such instance, subject to the provisions of the Deposit Agreement, be made
available by the Depositary to the record holders of Receipts in such manner as
the Company shall instruct.

A-7
<PAGE>

14. NOTICE OF DIVIDENDS, FIXING OF RECORD DATE. Whenever (a) any cash
dividend or other cash distribution shall become payable, or any distribution
other than cash shall be made, or any rights, preferences or privileges shall at
any time be offered, with respect to the Stock, or (b) the Depositary shall
receive notice of any meeting at which holders of Stock are entitled to vote or
of which holders of Stock are entitled to notice or of the mandatory conversion
of, or any election on the part of the Company to call for redemption of, any
shares of Stock, the Depositary shall in each such instance fix a record date
(which shall be the same date as the record date fixed by the Company with
respect to the Stock) for the determination of the holders of Receipts (i) who
shall be entitled to receive such dividend, distribution, rights, preferences or
privileges or the net proceeds of the sale thereof, or (ii) who shall be
entitled to give instructions for the exercise of voting rights at any such
meeting or of such meeting or to receive notice of such conversion or
redemption.

15. VOTING RIGHTS. Upon receipt of notice of any meeting at which the
holders of Stock are entitled to vote, the Depositary shall, as soon as
practicable thereafter, mail to the record holders of Receipts a notice, which
shall contain (a) such information as is contained in such notice of meeting,
(b) a statement that the holders of Receipts at the close of business on a
specified record date determined as provided in Paragraph 14 will be entitled,
subject to any applicable provision of law, the Articles of Incorporation or the
Certificate of Determination, to instruct the Depositary as to the exercise of
the voting rights pertaining to the Stock represented by their respective
Depositary Shares, and (c) a brief statement as to the manner in which such
instructions may be given. Upon the written request of a holder of this Receipt
on such record date the Depositary shall endeavor insofar as practicable to vote
or cause to be voted the Stock represented by the Depositary Shares evidenced by
this Receipt in accordance with the instructions set forth in such request. The
Company hereby agrees to take all reasonable action that may be deemed necessary
by the Depositary in order to enable the Depositary to vote such Stock or cause
such Stock to be voted. In the absence of specific instructions from the holder
of this Receipt, the Depositary will abstain from voting to the extent of the
Stock represented by the Depositary Shares evidenced by this Receipt.

16. REPORTS, INSPECTION OF TRANSFER BOOKS. The Depositary shall make
available for inspection by holders of Receipts at the Corporate Office, the New
York Office and at such other places as it may from time to time deem advisable
during normal business hours any reports and communications received from the
Company that are received by the Depositary as the holder of Stock. The
Depositary shall keep books at the Corporate Office for the registration and
transfer of Receipts, which books at all reasonable times will be open for
inspection by the record holders of Receipts; provided that any such holder
requesting to exercise such right shall certify to the Depositary that such
inspection shall be for a proper purpose reasonably related to such person's
interest as an owner of Depositary Shares.

17. LIABILITY OF THE DEPOSITARY, THE DEPOSITARY'S AGENTS, THE REGISTRAR
AND THE COMPANY. Neither the Depositary nor any Depositary's Agent nor the
Registrar nor the Company shall incur any liability to any holder of this
Receipt, if by reason of any provision of any present

A-8
<PAGE>

or future law or regulation thereunder of any governmental authority or, in the
case of the Depositary, the Registrar or any Depositary's Agent, by reason of
any provision present or future, of the Articles of Incorporation or the
Certificate of Determination or, in the case of the Company, the Depositary, the
Registrar or any Depositary's Agent, by reason of any act of God or war or other
circumstances beyond the control of the relevant party, the Depositary, any
Depositary's Agent, the Registrar or the Company shall be prevented or forbidden
from doing or performing any act or thing that the terms of the Deposit
Agreement provide shall be done or performed; nor shall the Depositary, any
Depositary's Agent, the Registrar or the Company incur any liability to any
holder of this Receipt (a) by reason of any nonperformance or delay, caused as
aforesaid, in the performance of any act or thing that the terms of the Deposit
Agreement provide shall or may be done or performed, or (b) by reason of any
exercise of, or failure to exercise, any discretion provided for in the Deposit
Agreement except, in the case of the Depositary, any Depositary's Agent or the
Registrar, if such exercise or failure to exercise discretion is caused by its
negligence or bad faith.

18. OBLIGATIONS OF THE DEPOSITARY, THE DEPOSITARY'S AGENTS, THE REGISTRAR
AND THE COMPANY. The Company assumes no obligation and shall be subject to no
liability under the Deposit Agreement or this Receipt to the holder hereof or
other persons, except to perform in good faith such obligations as are
specifically set forth and undertaken by it to perform in the Deposit Agreement.
Each of the Depositary, the Depositary's Agents and the Registrar assumes no
obligation and shall be subject to no liability under the Deposit Agreement or
this Receipt to the holder hereof or other persons, except to perform such
obligations as are specifically set forth and undertaken by it to perform in the
Deposit Agreement without negligence or bad faith.

Neither the Depositary nor any Depositary's Agent nor the Registrar nor the
Company shall be under any obligation to appear in, prosecute or defend any
action, suit or other proceeding with respect to Stock, Depositary Shares or
Receipts or Common Stock that in its opinion may involve it in expense or
liability, unless indemnity satisfactory to it against all expense and liability
be furnished as often as may be required.

Neither the Depositary nor any Depositary's Agent nor the Registrar nor the
Company will be liable for any action or failure to act by it in reliance upon
the advice of or information from legal counsel, accountants, any person
presenting Stock for deposit, any holder of this Receipt or any other person
believed by it in good faith to be competent to give such advice or information.

19. TERMINATION OF DEPOSIT AGREEMENT. Whenever so directed by the
Company, the Depositary will terminate this Deposit Agreement by mailing notice
of such termination to the record holders of all Receipts then outstanding at
least 30 days prior to the date fixed in such notice for such termination. The
Depositary may likewise terminate the Deposit Agreement if at any time 90 days
shall have expired after the Depositary shall have delivered to the Company a
written notice of its election to resign and a successor depositary shall not
have been appointed and accepted its appointment as provided in Section 5.04 of
the Deposit Agreement. In either

A-9
<PAGE>

case, on a date not less than 90 days after such notice, the Depositary shall
deliver or make available for delivery to holders of Receipts, upon surrender of
the such Receipts evidencing Depositary Shares, such number of whole or
fractional shares of the Stock as are represented by the Depositary Shares.

The Deposit Agreement shall automatically terminate after all
outstanding Depositary Shares have been redeemed or there has been a final
distribution in respect of the Stock in connection with any liquidation,
dissolution or winding up of the Company and such distribution has been
distributed to the holders of the Receipts.

Upon the termination of the Deposit Agreement, the Company shall be
discharged from all obligations thereunder except for its obligations to the
Depositary, any Depositary's Agent and any Registrar under Sections 5.07 and
5.08 of the Deposit Agreement.

If any Receipts remain outstanding after the date of termination of the
Deposit Agreement, the Depositary thereafter shall discontinue all functions and
be discharged from all obligations as provided in the Deposit Agreement, except
as specifically provided therein.

20. GOVERNING LAW. THE DEPOSIT AGREEMENT AND THIS RECEIPT AND ALL RIGHTS
THEREUNDER AND HEREUNDER AND PROVISIONS THEREOF AND HEREOF SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK, INCLUDING,
WITHOUT LIMITATION, SECTIONS 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.

A-10
<PAGE>

FORM OF ASSIGNMENT

For value received _____________________________ hereby sell(s), assign(s) and
transfer(s) unto _____________________________________________________________
(Please insert social security or other taxpayer identification number of
assignee.)

the within Receipt and all rights and interests represented by the Depositary
Shares evidenced thereby, and hereby irrevocably constitutes and appoints
_______________________ attorney to transfer the same on the books of the
within-named Depositary, with full power of substitution in the premises.

Dated:
---------------------------------

Signature(s)
-----------------------------------

-----------------------------------

-----------------------------------
Signature Guarantee*

- ----------------------
* (Signature must be guaranteed by an "eligible guarantor institution,"
that is, a bank, stockbroker, savings and loan association or credit union
meeting the requirements of the Conversion Agent, which requirements include
membership or participation in the Securities Transfer Agents Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Conversion Agent in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.)

A-11

<PAGE>

Exhibit 5.1

[Letterhead of Skadden, Arps, Slate, Meagher & Flom LLP]

January 29, 1999

UnionBanCal Corporation
400 California Street
San Francisco, CA 94104

Ladies and Gentlemen:

We have acted as special counsel to UnionBanCal Corporation, a
California corporation (the "Company"), UnionBanCal Finance Trust I, UnionBanCal
Finance Trust II, UnionBanCal Finance Trust III and UnionBanCal Finance Trust
IV, each a statutory business trust created under the Business Trust Act of the
State of Delaware (each, a "Trust," and collectively, the "Trusts"), in
connection with the preparation of the Registration Statement on Form S-3 (Nos.
333-67581, 333-67581-01, 333-67581-02, 333-67581-03 and 333-67581-04 (such
Registration Statement being hereinafter referred to as the "Registration
Statement") filed by the Company and the Trusts with the Securities and Exchange
Commission (the "Commission") with respect to the registration under the
Securities Act of 1933, as amended (the "Act"), of (i) the Company's (a)
unsecured senior debt securities, senior subordinated debt securities,
subordinated debt securities and junior subordinated debt securities
(collectively, the "Debt Securities"), which may be issued pursuant to an
indenture (as amended or supplemented, the "Indenture"), between the Company and
The First National Bank of Chicago, as Trustee (the "Trustee"), (b) shares of
Preferred Stock (the "Preferred Stock"), which may be represented by depositary
shares (the "Depositary Shares") evidenced by depositary receipts (the
"Receipts"), which may be issued under deposit agreements (the "Deposit
Agreements") to be entered into by the Company in respect of the Depositary
Shares; (c) shares of Common Stock (the "Common Stock"); and (d) guarantees of
the Preferred Securities of the Trusts (the "Preferred Securities Guarantee") to
be issued under one or more guarantee agreements (each, a "Guarantee Agreement")
to be entered into by the Company; and (ii) the Trusts' preferred securities
(the "Preferred Securities," and together with the Debt Securities, the
Preferred Stock, the Depositary Shares, the Common Stock and the Preferred
Securities Guarantees, the

<PAGE>

UnionBanCal Corporation
January 29, 1999
Page 2

"Offered Securities") that are to be issued by each Trust pursuant to its
respective Amended and Restated Declaration of Trust (each, an "Amended
Declaration").

This opinion is being furnished in accordance with the requirements of
Item 601(b)(5) of Regulation S-K under the Act.

In connection with this opinion, we have examined originals or copies,
certified or otherwise identified to our satisfaction, of (i) the Registration
Statement; (ii) the form of the Indenture filed as an exhibit to the
Registration Statement; (iii) the form of the Guarantee Agreements filed as
exhibits to the Registration Statement; (iv) the form of Deposit Agreement filed
as an exhibit to the Registration Statement; (v) the Amended and Restated
Articles of Incorporation (the "Articles of Incorporation") and the Bylaws (the
"Bylaws") of the Company as currently in effect; (vi) the Certificate of Trust
of each of the Trusts filed with the Secretary of State of the State of
Delaware; (vii) the Declaration of Trust of each of the Trusts dated as of
November 17, 1998 (the "Declaration of Trust"); (viii) the forms of the Amended
Declaration of each of the Trusts filed as exhibits to the Registration
Statement; (ix) a specimen certificate representing the Common Stock; (x) a
specimen certificate representing the Preferred Stock; and (xi) certain
resolutions of the Board of Directors of the Company relating to the
transactions contemplated by the Registration Statement, the Trusts and related
matters (the "Board Resolutions"). We have also examined originals or copies,
certified or otherwise identified to our satisfaction, of such other documents,
certificates and records as we have deemed necessary or appropriate as a basis
for the opinions set forth herein.

<PAGE>

UnionBanCal Corporation
January 29, 1999
Page 3

parties. We have also assumed that the execution and delivery by the Company
and the Trusts, as applicable, of the Indenture, the Offered Securities, the
Deposit Agreements, and the Guarantee Agreements and the performance of their
respective obligations thereunder do not and will not violate, conflict with or
constitute a default under (i) any agreement or instrument to which the Company,
the Trusts or their respective properties are subject (except that we do not
make the assumption set forth in this clause (i) with respect to the Articles of
Incorporation or the Bylaws or the Certificate of Trust, Declaration of Trust or
Amended Declaration of the respective Trusts), (ii) any law, rule, or
regulation to which the Company or the Trusts are subject (except that we do not
make the assumption set forth in this clause (ii) with respect to the Business
Trust Act of the State of Delaware, the California General Corporation Law (the
"CGCL"), the Delaware General Corporation Law (the "DGCL") or those laws, rules
and regulations of the State of New York and the United States of America (other
than securities or other anti-fraud laws) which, in our experience, are normally
applicable to transactions of the type contemplated by the Registration
Statement, but without our having made any special investigation concerning any
other laws, rules or regulations), (iii) any judicial or regulatory order or
decree of any governmental authority or (iv) any consent, approval, license,
authorization or validation of, or filing, recording or registration with, any
governmental authority. As to any facts material to the opinions expressed
herein which we have not independently established or verified, we have relied
upon oral or written statements and representations of officers and other
representatives of the Company, each of the Trusts and others.

We do not express any opinion as to the laws of any jurisdiction other
than the laws of the State of New York, the CGCL, the DGCL and the Business
Trust Act of the State of Delaware.

Based upon and subject to the limitations, qualifications, exceptions
and assumptions set forth herein, we are of the opinion that:

1. With respect to any series of Debt Securities (the "Offered Debt
Securities"), when (i) the Indenture has been duly authorized executed and
delivered by the Trustee, as qualified to act under the Trust Indenture Act of
1939; (ii) the authorized officers of the Company have taken all necessary
corporate action to fix and determine

<PAGE>

UnionBanCal Corporation
January 29, 1999
Page 4

the terms of the Offered Debt Securities in accordance with the Board
Resolutions; (iii) the terms of the Offered Debt Securities and of their
issuance and sale have been duly established in conformity with the Indenture so
as not to violate any applicable law, the Articles of Incorporation or Bylaws,
or result in a default under or breach of any agreement or instrument binding
upon the Company, and so as to comply with any requirement or restriction
imposed by any court or governmental body having jurisdiction over the Company;
(iv) the Indenture has been duly executed and delivered by the Company; and (v)
the Offered Debt Securities have been duly executed and authenticated in
accordance with the terms of the Indenture and duly delivered to the purchasers
thereof upon payment of the agreed-upon consideration therefor, the issuance and
sale of the Offered Debt Securities (including any Offered Debt Securities duly
issued upon exchange or conversion of any shares of Preferred Stock that are
exchangeable or convertible into Debt Securities) will have been duly
authorized, and the Offered Debt Securities will be valid and binding
obligations of the Company entitled to the benefits of the Indenture and
enforceable against the Company in accordance with their terms, except to the
extent that (x) enforcement thereof may be limited by (1) bankruptcy,
insolvency, reorganization, fraudulent transfer, moratorium or similar laws now
or hereinafter in effect relating to or affecting the enforcement of creditors'
rights generally, (2) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity), (3)
requirements that a claim with respect to any Offered Debt Securities
denominated other than in United States dollars (or a judgment denominated other
than in United States dollars in respect of such claim) be converted into United
States dollars at a rate of exchange prevailing on a date determined pursuant to
applicable law and (4) governmental authority to limit, delay or prohibit the
making of payments outside the United States or in foreign currency or composite
currency and (y) any waiver with respect to usury laws.

2. With respect to the shares of any series of Preferred Stock (the
"Offered Preferred Stock"), when (i) the Board of Directors of the Company or an
authorized committee thereof has taken all necessary corporate action to fix and
determine the terms of the Offered Preferred Stock in accordance with the Board
Resolutions, including the adoption of a Certificate of Determination for such
Preferred Stock in the form required by applicable law; (ii) such Certificate of
Determination has been duly filed with the Secretary of State of the State of
California; (iii) certificates

<PAGE>

UnionBanCal Corporation
January 29, 1999
Page 5

representing the shares of the Offered Preferred Stock have been manually signed
by an authorized officer of the transfer agent and registrar for the Offered
Preferred Stock and registered by such transfer agent and registrar, and
delivered to the purchasers thereof; and (iv) the Company receives consideration
per share for the Offered Preferred Stock in such amount as may be determined by
the Board of Directors of the Company, or an authorized committee thereof, in a
form legally valid under Section 409 of the CGCL, the issuance and sale of the
shares of Offered Preferred Stock will have been duly authorized, and such
shares will be validly issued, fully paid and nonassessable.

3. With respect to Depositary Shares representing fractional
interests in any series of Preferred Stock, when (i) the Board of Directors of
the Company or an authorized committee thereof has taken all necessary corporate
action to fix and determine the terms of the Depositary Shares and the related
series of Preferred Stock in accordance with the Board Resolutions, including
the adoption of a Certificate of Determination for such related series of
Preferred Stock in the form required by applicable law; (ii) such Certificate of
Determination has been duly filed with the Secretary of State of the State of
California; (iii) the terms of the Depositary Shares and of their issuance and
sale have been duly established in conformity with the Deposit Agreement so as
not to violate any applicable law, the Articles of Incorporation or Bylaws or
result in a default under or breach of any agreement or instrument binding upon
the Company, and so as to comply with any requirement or restriction imposed by
any court or governmental body having jurisdiction over the Company; (iv) the
applicable Deposit Agreement has been duly executed and delivered; (v) the
related shares of Preferred Stock have been duly authorized and validly issued
in accordance with the laws of the State of California and delivered to the
depositary for deposit in accordance with the Deposit Agreement; and (vi) the
Receipts evidencing the Depositary Shares have been duly issued against deposit
of the related shares of Preferred Stock with the depositary in accordance with
the Deposit Agreement, the issuance and sale of the Depositary Shares will be
validly issued and the Receipts will entitle the holders thereof to the rights
specified therein and in the Deposit Agreement.

4. With respect to the shares of Common Stock (the "Offered Common
Stock"), when (i) the Board of Directors of the Company or an authorized
committee thereof has taken all necessary corporate action to authorize the
issuance and

<PAGE>

UnionBanCal Corporation
January 29, 1999
Page 6

sale of the Offered Common Stock in accordance with the Board Resolutions; (ii)
certificates representing the shares of the Offered Common Stock in the form of
the specimen certificates examined by us have been manually signed by an
authorized officer of the transfer agent and registrar for the Common Stock and
registered by such transfer agent and registrar, and delivered to the purchasers
thereof; and (iii) the Company receives consideration per share of the Offered
Common Stock in a form legally valid under Section 409 of the CGCL, the issuance
and sale of the shares of Offered Common Stock (including any Offered Common
Stock duly issued upon exchange or conversion of any Debt Securities or shares
of Preferred Stock that are exchangeable or convertible into Common Stock,) will
have been duly authorized, and such Offered Common Stock will be validly issued,
fully paid and nonassessable.

5. With respect to the Preferred Securities (the "Offered Preferred
Securities"), when (i) the trustees of the applicable Trust have taken all
necessary action to adopt the Amended Declaration and to fix and determine the
terms of the Offered Preferred Securities in accordance with the Amended
Declaration; (ii) the terms of the Offered Preferred Securities and of their
issuance and sale have been duly established in conformity with the Amended
Declaration so as not to violate any applicable law, the applicable Certificate
of Trust, Declaration of Trust and Amended Declaration, or result in a default
under or a breach of any agreement or instrument binding upon the applicable
Trust and the Company, and so as to comply with any requirement or restriction
imposed by any court or governmental body having jurisdiction over the
applicable Trust and the Company; and (iii) the Offered Preferred Securities
have been duly issued and delivered by the applicable Trust as contemplated by
the Registration Statement and the prospectus supplement relating thereto, the
issuance and sale of the Offered Preferred Securities will have been duly
authorized for issuance and will represent, subject to paragraph 6 below,
fully-paid, nonassessable and undivided beneficial interests in the assets of
the applicable Trust.

6. The holders of the Offered Preferred Securities will be entitled
to the same limitation of personal liability extended to stockholders of private
corporations for profit organized under the DGCL. We bring to your attention,
however, that the holders of the Offered Preferred Securities of each Trust may
be obligated, pursuant to the Amended Declaration of such Trust, to (i) provide
indemnity

<PAGE>

UnionBanCal Corporation
January 29, 1999
Page 7

and/or security in connection with, and pay taxes or governmental charges
arising from, transfers of Offered Preferred Securities and the issuance of
replacement Offered Preferred Securities and (ii) provide security and indemnity
in connection with requests of or directions to the Property Trustee (as defined
therein) to exercise its rights and powers under the applicable Amended
Declaration.

7. With respect to the Preferred Securities Guarantees (the "Offered
Guarantees"), when (i) the trustees of the applicable Trust have taken all
necessary action to adopt the Amended Declaration and to fix and determine the
terms of the Offered Preferred Securities in accordance with the terms of the
applicable Amended Declaration; (ii) the Board of Directors of the Company or an
authorized committee thereof has taken all necessary corporate action to fix and
determine the terms of the Guarantees in accordance with the Board Resolution;
(iii) the terms of the Offered Preferred Securities and the related Offered
Guarantee and the issuance and sale thereof have been duly established in
conformity with the applicable Amended Declaration and applicable Guarantee
Agreement, respectively, so as not to violate any applicable law, the applicable
Certificate of Trust, Declaration of Trust and Amended Declaration, the Articles
of Incorporation and Bylaws, respectively, or result in a default under or a
breach of any agreement or instrument binding upon the Trust or the Company, and
so as to comply with any requirement or restriction imposed by any court or
governmental body having jurisdiction over the applicable Trust or the Company;
(iv) the applicable Guarantee Agreement has been duly executed and delivered;
(v) the Offered Preferred Securities have been duly issued and delivered by the
applicable Trust as contemplated by the Registration Statement and the
prospectus supplement relating thereto; (vi) certificates representing the
Offered Preferred Securities have been manually signed by an authorized officer
of the transfer agent and registrar for the Offered Preferred Securities and
registered by such transfer agent and registrar, and delivered to the purchasers
thereof; and (vii) the applicable Trust receives the agreed-upon consideration
therefor, the Offered Guarantee will be a valid and binding obligation of the
Company enforceable in accordance with its terms except to the extent that (A)
enforcement thereof may be limited by (x) bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium or similar laws now or
hereinafter in effect relating to or affecting the enforcement of creditors'
rights generally and (y) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity),

<PAGE>

UnionBanCal Corporation
January 29, 1999
Page 8

and (B) the waiver contained in Section 5.2 or 5.3 of the Guarantee Agreements
may be deemed unenforceable.

We hereby consent to the filing of this opinion with the Commission as
an exhibit to the Registration Statement. We also consent to the reference to
our firm under the caption "Legal Matters" in the Registration Statement. In
giving this consent, we do not thereby admit that we are included in the
category of persons whose consent is required under Section 7 of the Act or the
rules and regulations of the Commission. This opinion is expressed as of the
date hereof, and we disclaim any undertaking to advise you of any subsequent
changes in the facts stated or assumed herein or of any subsequent changes in
applicable law.

Very truly yours,

Skadden, Arps, Slate, Meagher & Flom LLP

<PAGE>

Exhibit 8.1

FORM OF OPINION

[______ __], 1999

UnionBanCal Corporation
400 California Street
San Francisco, CA 94104

UnionBanCal Finance Trust I
c/o UnionBancal Corporation
400 California Street
San Francisco, CA 94104

Re: [__]% Trust Capital Securities
Of UnionBanCal Finance Trust I
------------------------------

Ladies and Gentlemen:

We have acted as special tax counsel for UnionBanCal Corporation, a
California corporation (the "Company"), and UnionBanCal Finance Trust I, a
statutory business trust organized under the Business Trust Act of the State of
Delaware (12 Del. Code Ann., tit. 12, Sections 3801, ET SEQ.) (the "Trust"), in
connection with the sale pursuant to an Underwriting Agreement dated [_____ __],
1999 among the Company, the Trust, and the underwriters (the "Underwriters")
named therein (the "Underwriting Agreement") of [_],000,000 [__]% Trust Capital
Securities (liquidation amount $25 per capital security) of the Trust (the
"Capital Securities"), representing undivided beneficial interests in the assets
of the Trust.

The Capital Securities are guaranteed by the Company with respect to
distributions and payments upon liquidation, redemption, and otherwise pursuant
to the Guarantee Agreement, dated as of [_______ __],1999 (the "Guarantee
Agreement"), between the Company and The First National Bank of Chicago, as
trustee, for the benefit of the holders of the Capital Securities.

DRAFT

<PAGE>

UnionBanCal Corporation
UnionBanCal Finance Trust I
[ ], 1999
Page 2

In connection with the issuance of the Capital Securities, the Trust
is also issuing [_______] [ ]% Common Securities (liquidation amount $25 per
common security) (the "Common Securities"), representing undivided beneficial
interests in the assets of the Trust.

The proceeds from the sale of the Capital Securities and the Common
Securities are to be used by the Trust to purchase an aggregate principal amount
of $[_______] of [ ]% Junior Subordinated Debentures due [_____ __], 2029 (the
"Debentures"), to be issued by the Company. The Capital Securities and the
Common Securities are to be issued pursuant to the Amended and Restated
Declaration of Trust, dated as of [______ __], 1999 (the "Declaration"), among
the Company, as sponsor, First Chicago Delaware Inc., as Delaware trustee (the
"Delaware Trustee"), The First National Bank of Chicago, as property trustee
(the "Property Trustee"), and David A. Anderson, David I. Matson, and John H.
McGuckin, Jr. as regular trustees (the "Regular Trustees"). The Debentures are
to be issued pursuant to an indenture, dated as of [______ __], 1999 (the
"Indenture"), between the Company and The First National Bank of Chicago, as
debt trustee (the "Debt Trustee").

Capitalized terms used but not otherwise defined herein shall have
the respective meanings set forth in the Underwriting Agreement.

In connection with this opinion, we have examined originals or copies,
certified or otherwise identified to our satisfaction, of (i) the Prospectus
Supplement dated [_______ __, 1999] (including a Prospectus dated _______ __,
1999]; (ii) the Certificate of Trust filed with the Secretary of State of the
State of Delaware as of November 17, 1998, by the Regular Trustees, the Property
Trustee, and the Delaware Trustee; (iii) an executed copy of the Declaration
including the designation of the terms of the Capital Securities; (iv) the form
of the Capital Securities and a specimen certificate thereof; (v) an executed
copy of the Guarantee Agreement; (vi) an executed copy of the Indenture; (vii)
the form of Debentures and a specimen certificate thereof; (viii) the form of
Common Securities and a specimen certificate thereof; (ix) an executed copy of
the Underwriting Agreement; and (x) representations from an officer of the
Company dated [______ __,] 1999. We

DRAFT

<PAGE>

UnionBanCal Corporation
UnionBanCal Finance Trust I
[ ], 1999
Page 3

have also examined originals or copies, certified or otherwise identified to our
satisfaction, of such records of the Company and the Trust and such agreements,
certificates of public officials, certificates of officers, trustees or other
representatives of the Company, the Trust and others, as applicable, and such
other documents, certificates and records as we have deemed necessary or
appropriate as a basis for the opinions set forth herein.

In our examination, we have assumed the legal capacity of all natural
persons, the genuineness of all signatures, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as certified, conformed or photostatic copies, and the
authenticity of the originals of such latter documents. In making our
examination of documents executed, or to be executed by parties other than the
Company or the Trust, we have assumed that such parties had, or will have, the
power, corporate or other, to enter into and perform all obligations thereunder,
and we have also assumed the due authorization by all requisite action,
corporate or other, and execution and delivery by such parties of such documents
and that such documents constitute, or will constitute, valid and binding
obligations of such parties. As to any facts material to the opinions expressed
herein which were not independently established or verified, we have relied upon
oral or written statements and representations of officers, trustees and other
representatives of the Company, the Trust and others.

In rendering our opinion, we have participated in the preparation of
the Prospectus Supplement. Our opinion is conditioned on, among other things,
the initial and continuing accuracy of the facts, information, covenants, and
representations set forth in the documents referred to above and the statements
and representations made by the Company and the Trust.

In rendering our opinion, we have considered the provisions of the
Internal Revenue Code of 1986, as amended, Treasury regulations (proposed,
temporary, and final) promulgated thereunder, judicial decisions, and Internal
Revenue Service rulings all as of the date hereof, and all of which are subject
to change, which changes may be retroactively applied. A change in the
authorities upon which our

DRAFT

<PAGE>

UnionBanCal Corporation
UnionBanCal Finance Trust I
[ ], 1999
Page 4

opinion is based could affect our conclusions. There can be no assurance,
moreover, that any of the opinions expressed herein will be accepted by the
Internal Revenue Service or, if challenged, by a court.

Based solely upon the foregoing, we are of the opinion that under
current United States federal income tax law:

(1) The Trust will be classified as a grantor trust and not as an
association taxable as a corporation.

(2) The Debentures will be classified as indebtedness of the Company.

Except as set forth above, we express no opinion to any party as to
the tax consequences, whether United States federal, state, local or foreign, of
the issuance of the Debentures, the Capital Securities, the Common Securities,
or any transactions related to or contemplated by such issuance. In connection
with the sale of the Capital Securities pursuant to the Registration Statement,
we are furnishing this opinion to you solely for your benefit and the benefit of
investors purchasing the Capital Securities upon original issuance. This
opinion is not to be used, circulated, quoted, or otherwise referred to for any
other purpose without our written permission.

The opinions expressed herein are subject to, and conditioned upon,
reconfirmation and delivery of these opinions at the time of the closing of the
offering of Capital Securities. This opinion is expressed as of the date
hereof, and we disclaim any undertaking to advise you of changes of the facts
stated or assumed herein or any subsequent changes in applicable law.

We consent to the filing of this opinion as Exhibit 8.1 to the
Registration Statement of the Company dated [______ __], 1999, as filed with the
Securities and Exchange Commission on [_______ __], 1999, and to the reference
to Skadden, Arps, Slate, Meagher & Flom LLP therein under the caption "Legal
Matters." In giving this consent, we do not thereby admit that we are within
the category of

DRAFT

<PAGE>

UnionBanCal Corporation
UnionBanCal Finance Trust I
[ ], 1999
Page 5

persons whose consent is required under Section 7 of the Securities Act of 1933,
as amended, or the rules or regulations of the Securities and Exchange
Commission promulgated thereunder.

Very truly yours,

DRAFT

<PAGE>

EXHIBIT 12.1

Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock
Dividend Requirements

<TABLE>
<CAPTION>
For the Nine Months
Ended
(In millions, except ratios) For the Years Ended December 31, September 30,
- ------------------------------------------------------------ ------------------------------------------------------------------
1993 1994 1995 1996 1997 1997 1998
------ ------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
EXCLUDING INTEREST ON DEPOSITS
Income before income taxes and effect of accounting changes $ 172 $ 246 $ 506 $ 412 $ 650 $ 494 $ 498

Fixed Charges:
Interest expense 457 483 705 759 802 597 577
One third of rents, net income from subleases (A) 15 17 14 18 12 9 10
------ ------ ------ ------ ------ ------ ------
Total fixed charges 472 500 719 777 814 606 587
------ ------ ------ ------ ------ ------ ------
Earnings before taxes, fixed charges, and effect of
accounting changes, excluding capitalized interest $ 644 $ 746 $1,225 $1,189 $1,464 $1,100 $1,085
------ ------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------ ------
Fixed charges, as above $ 472 $ 500 $ 719 $ 777 $ 814 $ 606 $ 587
Preferred stock dividends 11 11 11 11 8 8 -
------ ------ ------ ------ ------ ------ ------
Fixed charges including preferred stock dividends $ 483 $ 511 $ 730 $ 788 $ 822 $ 614 $ 587
------ ------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------ ------
Ratio of earnings to fixed charges and preferred
stock dividend requirements 1.33 1.46 1.68 1.51 1.78 1.79 1.85
------ ------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------ ------
INCLUDING INTEREST ON DEPOSITS
Fixed charges including preferred stock dividends $ 483 $ 511 $ 730 $ 788 $ 822 $ 614 $ 587
Add: Interest on deposits 314 311 454 532 596 442 420
------ ------ ------ ------ ------ ------ ------
Total fixed charges including preferred stock
dividends and interest on deposits $ 797 $ 822 $1,184 $1,320 $1,418 $1,056 $1,007
------ ------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------ ------
Earnings before taxes, fixed charges, and effect of
accounting changes, excluding capitalized
interest, as above $ 644 $ 746 $1,225 $1,189 $1,464 $1,100 $1,085
Add: Interest on deposits 314 311 454 532 596 442 420
------ ------ ------ ------ ------ ------ ------

Total earnings before taxes, fixed charges, effect
of accounting changes, and interest on deposits $ 958 $1,057 $1,679 $1,721 $2,060 $1,542 $1,505
------ ------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------ ------
Ratio of earnings to fixed charges and preferred
stock dividend requirements 1.20 1.29 1.42 1.30 1.45 1.46 1.49
------ ------ ------ ------ ------ ------ ------
------ ------ ------ ------ ------ ------ ------

</TABLE>

(A) The proportion deemed representative of the interest factor.

EX-1

<PAGE>
EXHIBIT 23.1

INDEPENDENT AUDITORS' CONSENT

We consent to the incorporation by reference in Amendment No. 2 to Registration
Statement Nos. 333-67581, 333-67581-01, 333-67581-02, 333-67581-03, and
333-67581-04 of UnionBanCal Corporation of our report dated January 30, 1998
(November 18, 1998 as to the exchange of common stock referred to in Note 1,
paragraphs 3 and 4, and the adoption of SFAS No. 130, "Reporting Comprehensive
Income," referred to in Notes 1 and 18, and December 7, 1998 as to the stock
split referred to in Note 1, paragraph 5) appearing in Form 8-K of UnionBanCal
Corporation dated January 11, 1999, and to the reference to us under the heading
"Experts" in the Prospectus, which is a part of these Registration Statements.

DELOITTE & TOUCHE LLP
San Francisco, California
January 29, 1999

<PAGE>
EXHIBIT 23.2

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the incorporation by
reference of our report dated January 24, 1996 on the consolidated financial
statements of Union Bank and subsidiaries for the year ended December 31, 1995
(not presented herein), included in Form 8-K of UnionBanCal Corporation dated
January 11, 1999, in Amendment No. 2 to Form S-3 Registration Statements File
Nos. 333-67581, 333-67581-01, 333-67581-02, 333-67581-03 and 333-67581-04. It
should be noted that we have not audited any financial statements of Union Bank
and subsidiaries subsequent to December 31, 1995 or performed any audit
procedures subsequent to the date of our report.

ARTHUR ANDERSEN LLP

San Francisco, California
January 29, 1999

<PAGE>

EXHIBIT 25.1

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE

CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)

----------------

THE FIRST NATIONAL BANK OF CHICAGO
(EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER)

A NATIONAL BANKING ASSOCIATION 36-0899825
(I.R.S. EMPLOYER
IDENTIFICATION NUMBER)

ONE FIRST NATIONAL PLAZA, CHICAGO, ILLINOIS 60670-0126
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

THE FIRST NATIONAL BANK OF CHICAGO
ONE FIRST NATIONAL PLAZA, SUITE 0286
CHICAGO, ILLINOIS 60670-0286
ATTN: LYNN A. GOLDSTEIN, LAW DEPARTMENT (312) 732-6919
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)

----------------
UNIONBANCAL CORPORATION
(EXACT NAME OF OBLIGORS AS SPECIFIED IN THEIR TRUST AGREEMENTS)

CALIFORNIA 94-1234979
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)

350 CALIFORNIA STREET
SAN FRANCISCO, CALIFORNIA 94104
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

DEBT SECURITIES
GUARANTEE OF TRUST PREFERRED SECURITIES OF UNIONBANCAL FINANCE TRUST I
GUARANTEE OF TRUST PREFERRED SECURITIES OF UNIONBANCAL FINANCE TRUST II
GUARANTEE OF TRUST PREFERRED SECURITIES OF UNIONBANCAL FINANCE TRUST III
GUARANTEE OF TRUST PREFERRED SECURITIES OF UNIONBANCAL FINANCE TRUST IV

(TITLE OF INDENTURE SECURITIES)

<PAGE>

ITEM 1. GENERAL INFORMATION. FURNISH THE FOLLOWING
INFORMATION AS TO THE TRUSTEE:

(a) NAME AND ADDRESS OF EACH EXAMINING OR
SUPERVISING AUTHORITY TO WHICH IT IS SUBJECT.

Comptroller of Currency, Washington, D.C.;
Federal Deposit Insurance Corporation,
Washington, D.C.; The Board of Governors of
the Federal Reserve System, Washington D.C.

(b) WHETHER IT IS AUTHORIZED TO EXERCISE
CORPORATE TRUST POWERS.

The trustee is authorized to exercise corporate
trust powers.

ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR
IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH
SUCH AFFILIATION.

No such affiliation exists with the trustee.

ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A
PART OF THIS STATEMENT OF ELIGIBILITY.

1. A copy of the articles of association of the
trustee now in effect.*

2. A copy of the certificates of authority of the
trustee to commence business.*

3. A copy of the authorization of the trustee to
exercise corporate trust powers.*

4. A copy of the existing by-laws of the trustee.*

5. Not Applicable.

6. The consent of the trustee required by
Section 321(b) of the Act.

<PAGE>

7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.

8. Not Applicable.

9. Not Applicable.

Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the
United States of America, has duly caused this Statement of
Eligibility to be signed on its behalf by the undersigned, thereunto
duly authorized, all in the City of Chicago and State of Illinois, on
the 19th day of January, 1999.

THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE

BY /s/ STEVEN M. WAGNER
--------------------
STEVEN M. WAGNER
FIRST VICE PRESIDENT

* EXHIBIT 1, 2, 3 AND 4 ARE HEREIN INCORPORATED BY REFERENCE TO EXHIBITS
BEARING IDENTICAL NUMBERS IN ITEM 16 OF THE FORM T-1 OF THE FIRST NATIONAL BANK
OF CHICAGO, FILED AS EXHIBIT 25 TO THE REGISTRATION STATEMENT ON FORM S-3 OF U S
WEST CAPITAL FUNDING, INC., FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON
MAY 6, 1998 (REGISTRATION NO. 333-51907-01).

<PAGE>

EXHIBIT 6

THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT

January 19, 1999

Securities and Exchange Commission
Washington, D.C. 20549

Gentlemen:

In connection with the qualification of (i) the Indenture of UnionBanCal
Corporation to The First National Bank of Chicago, as Trustee, relating to
the Debt Securities of UnionBanCal Corporation, (ii) the Preferred Securities
Guarantee Agreement of the Trust Preferred Securities of UnionBanCal Finance
Trust I, (iii) the Preferred Securities Guarantee Agreement of the Trust
Preferred Securities of UnionBanCal Finance Trust II, (iv) the Preferred
Securities Guarantee Agreement of the Trust Preferred Securities of
UnionBanCal Finance Trust III, and (v) the Preferred Securities Guarantee
Agreement of the Trust Preferred Securities of UnionBanCal Finance Trust IV,
the undersigned, in accordance with Section 321(b) of the Trust Indenture Act
of 1939, as amended, hereby consents that the reports of examinations of the
undersigned, made by Federal or State authorities authorized to make such
examinations, may be furnished by such authorities to the Securities and
Exchange Commission upon its request therefor.

Very truly yours,

THE FIRST NATIONAL BANK OF CHICAGO

BY: /s/ STEVEN M. WAGNER
--------------------
STEVEN M. WAGNER
FIRST VICE PRESIDENT

<PAGE>

EXHIBIT 7
<TABLE>
<CAPTION>
<S> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 09/30/98 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
</TABLE>
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR SEPTEMBER 30, 1998

All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.

SCHEDULE RC--BALANCE SHEET

DOLLAR AMOUNTS IN THOUSANDS C400
----
RCFD BIL MIL THOU
---- --- --- ----
<S> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A): RCFD
----
a. Noninterest-bearing balances and currency and coin(1).............. 0081 4,898,646 1.a
b. Interest-bearing balances(2)....................................... 0071 4,612,143 1.b
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A).......... 1754 0 2.a
b. Available-for-sale securities (from Schedule RC-B, column D)....... 1773 9,817,318 2.b
3. Federal funds sold and securities purchased under agreements to
resell 1350 6,071,229 3.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule RCFD
RC-C)................................................................. 2122 26,327,215 4.a
b. LESS: Allowance for loan and lease losses.......................... 3123 412,850 4.b
c. LESS: Allocated transfer risk reserve ............................. 3128 0 4.c
d. Loans and leases, net of unearned income, allowance, and RCFD
reserve (item 4.a minus 4.b and 4.c).................................. 2125 25,914,365 4.d
5. Trading assets (from Schedule RD-D)................................... 3545 6,924,064 5.
6. Premises and fixed assets (including capitalized leases).............. 2145 731,747 6.
7. Other real estate owned (from Schedule RC-M).......................... 2150 6,424 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)........................................ 2130 153,385 8.
9. Customers' liability to this bank on acceptances outstanding.......... 2155 352,324 9.
10. Intangible assets (from Schedule RC-M)................................ 2143 295,823 10.
11. Other assets (from Schedule RC-F)..................................... 2160 2,193,803 11.
12. Total assets (sum of items 1 through 11).............................. 2170 61,971,271 12.
</TABLE>
- --------------------

(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.

<PAGE>
<TABLE>
<CAPTION>
<S> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 09/30/98 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
</TABLE>
SCHEDULE RC-CONTINUED

<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN
THOUSANDS
---------
<S> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C RCON
from Schedule RC-E, part 1)................................ 2200 20,965,124 13.a
(1) Noninterest-bearing(1)................................. 6631 9,191,662 13.a1
Interest-bearing............................................. 6636 11,773,462 13.a2

b. In foreign offices, Edge and Agreement subsidiaries, and RCFN
IBFs (from Schedule RC-E, part II)......................... 2200 15,912,956 13.b
(1) Noninterest bearing.................................... 6631 475,182 13.b1
(2) Interest-bearing....................................... 6636 15,437,774 13.b2
14. Federal funds purchased and securities sold under agreements
to repurchase: RCFD 2800 4,245,925 14
15. a. Demand notes issued to the U.S. Treasury RCON 2840 359,381 15.a
Trading Liabilities (from Sechedule RC-D).................. RCFD 3548 5,614,049 15.b

16. Other borrowed money: RCFD
a. With original maturity of one year or less................. 2332 4,603,402 16.a
b. With original maturity of more than one year.............. A547 328,001 16.b
c. With original maturity of more than three years........... A548 324,984 16.c

17. Not applicable
18. Bank's liability on acceptance executed and outstanding....... 2920 352,324 18.
19. Subordinated notes and debentures............................. 3200 2,400,000 19.
20. Other liabilities (from Schedule RC-G)........................ 2930 1,833,935 20.
21. Total liabilities (sum of items 13 through 20)................ 2948 56,940,081 21.
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus................. 3838 0 23.
24. Common stock.................................................. 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)...... 3839 3,192,857 25.
26. a. Undivided profits and capital reserves..................... 3632 1,614,511 26.a
b. Net unrealized holding gains (losses) on available-for-sale
securities................................................. 8434 27,815 26.b
27. Cumulative foreign currency translation adjustments........... 3284 (4,851) 27.
28. Total equity capital (sum of items 23 through 27)............. 3210 5,031,190 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)......................... 3300 61,971,271 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.

1. Indicate in the box at the right the number of the statement below that
best describes the most comprehensive level of auditing work performed
for the bank by independent external auditors as of any date during 1996
Number
.............................................. RCFD 6724 ... N/A M.1.
<TABLE>
<CAPTION>

<S> <C>
1 = Independent audit of the bank conducted in accordance 4. = Directors' examination of the bank performed by other
with generally accepted auditing standards by a certified external auditors (may be required by state chartering
public accounting firm which submits a report on the bank authority)
2 = Independent audit of the bank's parent holding company 5 = Review of the bank's financial statements by external
conducted in accordance with generally accepted auditing auditors
standards by a certified public accounting firm which 6 = Compilation of the bank's financial statements by external
submits a report on the consolidated holding company auditors
(but not on the bank separately) 7 = Other audit procedures (excluding tax preparation work)
3 = Directors' examination of the bank conducted in 8 = No external audit work
accordance with generally accepted auditing standards
by a certified public accounting firm (may be required by
state chartering authority)
</TABLE>

(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.

<PAGE>

EXHIBIT 25.2

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE

CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)

------------------

THE FIRST NATIONAL BANK OF CHICAGO
(EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER)

A NATIONAL BANKING ASSOCIATION 36-0899825
(I.R.S. EMPLOYER
IDENTIFICATION NUMBER)

ONE FIRST NATIONAL PLAZA, CHICAGO, ILLINOIS 60670-0126
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

------------------

UNIONBANCAL FINANCE TRUST I
(EXACT NAME OF OBLIGORS AS SPECIFIED IN THEIR TRUST AGREEMENTS)

DELAWARE 94-3313816
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)

350 CALIFORNIA STREET
SAN FRANCISCO, CALIFORNIA 94104
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

PREFERRED SECURITIES OF UNIONBANCAL FINANCE TRUST I
(TITLE OF INDENTURE SECURITIES)

<PAGE>

ITEM 1. GENERAL INFORMATION. FURNISH THE FOLLOWING
-------------------
INFORMATION AS TO THE TRUSTEE:

(a) NAME AND ADDRESS OF EACH EXAMINING OR
SUPERVISING AUTHORITY TO WHICH IT IS SUBJECT.

Comptroller of Currency, Washington, D.C.;
Federal Deposit Insurance Corporation,
Washington, D.C.; The Board of Governors of
the Federal Reserve System, Washington D.C..

(b) WHETHER IT IS AUTHORIZED TO EXERCISE
CORPORATE TRUST POWERS.

The trustee is authorized to exercise corporate
trust powers.

ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR
-----------------------------
IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH
SUCH AFFILIATION.

No such affiliation exists with the trustee.

ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A
----------------
PART OF THIS STATEMENT OF ELIGIBILITY.

1. A copy of the articles of association of the
trustee now in effect.*

2. A copy of the certificates of authority of the
trustee to commence business.*

3. A copy of the authorization of the trustee to
exercise corporate trust powers.*

4. A copy of the existing by-laws of the trustee.*

5. Not Applicable.

6. The consent of the trustee required by
Section 321(b) of the Act.

<PAGE>

7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.

8. Not Applicable.

9. Not Applicable.

THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE

BY: /s/ STEVEN M. WAGNER
-----------------------------
STEVEN M. WAGNER
FIRST VICE PRESIDENT

* Exhibits 1, 2, 3 and 4 are herein incorporated by reference to Exhibits
bearing identical numbers in Item 16 of the Form T-1 of The First National
Bank of Chicago, filed as Exhibit 25 to the Registration Statement on Form
S-3 of U S WEST Capital Funding, Inc. filed with the Securities and Exchange
Commission on May 6, 1998 (Registration No. 333-51907-01).

<PAGE>

EXHIBIT 6

THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT

January 19, 1999

Securities and Exchange Commission
Washington, D.C. 20549

Gentlemen:

In connection with the qualification of the Amended and Restated Declaration
of Trust of UnionBanCal Finance Trust I, the undersigned, in accordance with
Section 321(b) of the Trust Indenture Act of 1939, as amended, hereby
consents that the reports of examinations of the undersigned, made by Federal
or State authorities authorized to make such examinations, may be furnished
by such authorities to the Securities and Exchange Commission upon its
request therefor.

Very truly yours,

THE FIRST NATIONAL BANK OF CHICAGO

BY: /s/ STEVEN M. WAGNER
---------------------------
STEVEN M. WAGNER
FIRST VICE PRESIDENT

<PAGE>

EXHIBIT 7

Legal Title of Bank: The First National Bank of Chicago Call Date: 09/30/98
ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------

CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR SEPTEMBER 30, 1998

All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.

SCHEDULE RC--BALANCE SHEET

<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN THOUSANDS C400
RCFD BIL MIL THOU ----
---- ------------
<S> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A): RCFD
a. Noninterest-bearing balances and currency and coin(1)................... 0081 4,898,646 1.a
b. Interest-bearing balances(2)............................................ 0071 4,612,143 1.b
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A)............... 1754 0 2.a
b. Available-for-sale securities (from Schedule RC-B, column D)............ 1773 9,817,318 2.b
3. Federal funds sold and securities purchased under agreements to
resell..................................................................... 1350 6,071,229 3.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule RCFD
RC-C)...................................................................... 2122 26,327,215 4.a
b. LESS: Allowance for loan and lease losses............................... 3123 412,850 4.b
c. LESS: Allocated transfer risk reserve................................... 3128 0 4.c
d. Loans and leases, net of unearned income, allowance, and RCFD
reserve (item 4.a minus 4.b and 4.c)....................................... 2125 25,914,365 4.d
5. Trading assets (from Schedule RD-D)........................................ 3545 6,924,064 5.
6. Premises and fixed assets (including capitalized leases)................... 2145 731,747 6.
7. Other real estate owned (from Schedule RC-M)............................... 2150 6,424 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)............................................. 2130 153,385 8.
9. Customers' liability to this bank on acceptances outstanding............... 2155 352,324 9.
10. Intangible assets (from Schedule RC-M)..................................... 2143 295,823 10.
11. Other assets (from Schedule RC-F).......................................... 2160 2,193,803 11.
12. Total assets (sum of items 1 through 11)................................... 2170 61,971,271 12.
</TABLE>
- -------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.

<PAGE>

Legal Title of Bank: The First National Bank of Chicago Call Date: 09/30/98
ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------

SCHEDULE RC-CONTINUED

<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN
THOUSANDS
-----------------
<S> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C RCON
from Schedule RC-E, part 1)............................... 2200 20,965,124 13.a
(1) Noninterest-bearing(1)................................ 6631 9,191,662 13.a1
(2) Interest-bearing...................................... 6636 11,773,462 13.a2

b. In foreign offices, Edge and Agreement subsidiaries, and RCFN
IBFs (from Schedule RC-E, part II)........................ 2200 15,912,956 13.b
(1) Noninterest bearing................................... 6631 475,182 13.b1
(2) Interest-bearing...................................... 6636 15,437,774 13.b2
14. Federal funds purchased and securities sold under agreements
to repurchase:............................................... RCFD 2800 4,245,925 14
15. a. Demand notes issued to the U.S. Treasury.................. RCON 2840 359,381 15.a
b. Trading Liabilities(from Sechedule RC-D).................. RCFD 3548 5,614,049 15.b

16. Other borrowed money: RCFD
a. With original maturity of one year or less................ 2332 4,603,402 16.a
b. With original maturity of more than one year............. A547 328,001 16.b
c. With original maturity of more than three years.......... A548 324,984 16.c

17. Not applicable
18. Bank's liability on acceptance executed and outstanding...... 2920 352,324 18.
19. Subordinated notes and debentures............................ 3200 2,400,000 19.
20. Other liabilities (from Schedule RC-G)....................... 2930 1,833,935 20.
21. Total liabilities (sum of items 13 through 20)............... 2948 56,940,081 21.
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus................ 3838 0 23.
24. Common stock................................................. 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)..... 3839 3,192,857 25.
26. a. Undivided profits and capital reserves.................... 3632 1,614,511 26.a
b. Net unrealized holding gains (losses) on available-for-
sale securities........................................... 8434 27,815 26.b
27. Cumulative foreign currency translation adjustments.......... 3284 (4,851) 27.
28. Total equity capital (sum of items 23 through 27)............ 3210 5,031,190 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)........................ 3300 61,971,271 29.
</TABLE>

Memorandum
To be reported only with the March Report of Condition.
<TABLE>
<S> <C> <C> <C>
1. Indicate in the box at the right the number of the statement
below that best describes the most comprehensive level of
auditing work performed for the bank by independent external Number
auditors as of any date during 1996.......................... RCFD 6724 N/A M.1.
</TABLE>

1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank

2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified
public accounting firm which submits a report on the consolidated holding
company (but not on the bank separately)

3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)

4 = Directors' examination of the bank performed by other external auditors
(may be required by state chartering authority)

5 = Review of the bank's financial statements by external auditors

6 = Compilation of the bank's financial statements by external auditors

7 = Other audit procedures (excluding tax preparation work)

8 = No external audit work

- ------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.

<PAGE>

EXHIBIT 25.3

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE

CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)

----------------

THE FIRST NATIONAL BANK OF CHICAGO
(EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER)

A NATIONAL BANKING ASSOCIATION 36-0899825
(I.R.S. EMPLOYER
IDENTIFICATION NUMBER)

ONE FIRST NATIONAL PLAZA, CHICAGO, ILLINOIS 60670-0126
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

----------------
UNIONBANCAL FINANCE TRUST II
(EXACT NAME OF OBLIGORS AS SPECIFIED IN THEIR TRUST AGREEMENTS)

DELAWARE 94-3313838
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)

350 CALIFORNIA STREET
SAN FRANCISCO, CALIFORNIA 94104
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

PREFERRED SECURITIES OF UNIONBANCAL FINANCE TRUST II
(TITLE OF INDENTURE SECURITIES)

<PAGE>

ITEM 1. GENERAL INFORMATION. FURNISH THE FOLLOWING
INFORMATION AS TO THE TRUSTEE:

(a) NAME AND ADDRESS OF EACH EXAMINING OR
SUPERVISING AUTHORITY TO WHICH IT IS SUBJECT.

Comptroller of Currency, Washington, D.C.;
Federal Deposit Insurance Corporation,
Washington, D.C.; The Board of Governors of
the Federal Reserve System, Washington D.C..

(b) WHETHER IT IS AUTHORIZED TO EXERCISE
CORPORATE TRUST POWERS.

The trustee is authorized to exercise corporate
trust powers.

ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR
IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH
SUCH AFFILIATION.

No such affiliation exists with the trustee.

ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A
PART OF THIS STATEMENT OF ELIGIBILITY.

1. A copy of the articles of association of the
trustee now in effect.*

2. A copy of the certificates of authority of the
trustee to commence business.*

3. A copy of the authorization of the trustee to
exercise corporate trust powers.*

4. A copy of the existing by-laws of the trustee.*

5. Not Applicable.

6. The consent of the trustee required by
Section 321(b) of the Act.

<PAGE>

7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.

8. Not Applicable.

9. Not Applicable.

THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE

BY /s/ STEVEN M. WAGNER
--------------------
STEVEN M. WAGNER
FIRST VICE PRESIDENT

<PAGE>

EXHIBIT 6

THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT

January 19, 1999

Securities and Exchange Commission
Washington, D.C. 20549

Gentlemen:

In connection with the qualification of the Amended and Restated Declaration
of Trust of UnionBanCal Finance Trust II, the undersigned, in accordance with
Section 321(b) of the Trust Indenture Act of 1939, as amended, hereby
consents that the reports of examinations of the undersigned, made by Federal
or State authorities authorized to make such examinations, may be furnished
by such authorities to the Securities and Exchange Commission upon its
request therefor.

Very truly yours,

THE FIRST NATIONAL BANK OF CHICAGO

BY: /s/ STEVEN M. WAGNER
--------------------
STEVEN M. WAGNER
FIRST VICE PRESIDENT

<PAGE>

EXHIBIT 7
<TABLE>
<S> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 09/30/98 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
</TABLE>

CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR SEPTEMBER 30, 1998

All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.

SCHEDULE RC--BALANCE SHEET

<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN THOUSANDS C400
----
RCFD BIL MIL THOU
---- --- --- ----
<S> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A): RCFD
a. Noninterest-bearing balances and currency and coin(1).............. 0081 4,898,646 1.a
b. Interest-bearing balances(2)....................................... 0071 4,612,143 1.b
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A).......... 1754 0 2.a
b. Available-for-sale securities (from Schedule RC-B, column D)....... 1773 9,817,318 2.b
3. Federal funds sold and securities purchased under agreements to
resell................................................................ 1350 6,071,229 3.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule RCFD
RC-C)................................................................. 2122 26,327,215 4.a
b. LESS: Allowance for loan and lease losses.......................... 3123 412,850 4.b
c. LESS: Allocated transfer risk reserve.............................. 3128 0 4.c
d. Loans and leases, net of unearned income, allowance, and RCFD
reserve (item 4.a minus 4.b and 4.c).................................. 2125 25,914,365 4.d
5. Trading assets (from Schedule RD-D)................................... 3545 6,924,064 5.
6. Premises and fixed assets (including capitalized leases).............. 2145 731,747 6.
7. Other real estate owned (from Schedule RC-M).......................... 2150 6,424 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)........................................ 2130 153,385 8.
9. Customers' liability to this bank on acceptances outstanding.......... 2155 352,324 9.
10. Intangible assets (from Schedule RC-M)................................ 2143 295,823 10.
11. Other assets (from Schedule RC-F)..................................... 2160 2,193,803 11.
12. Total assets (sum of items 1 through 11).............................. 2170 61,971,271 12.
</TABLE>
- ------------------

(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.

<PAGE>

<TABLE>
<S> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 09/30/98 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
</TABLE>

SCHEDULE RC-CONTINUED
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN
THOUSANDS
---------
<S> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C RCON
from Schedule RC-E, part 1)................................... 2200 20,965,124 13.a
(1) Noninterest-bearing(1).................................... 6631 9,191,662 13.a1
(2) Interest-bearing.......................................... 6636 11,773,462 13.a2

b. In foreign offices, Edge and Agreement subsidiaries, and RCFN
IBFs (from Schedule RC-E, part II)............................ 2200 15,912,956 13.b
(1) Noninterest bearing....................................... 6631 475,182 13.b1
(2) Interest-bearing.......................................... 6636 15,437,774 13.b2
14. Federal funds purchased and securities sold under agreements
to repurchase: RCFD 2800 4,245,925 14
15. a. Demand notes issued to the U.S. Treasury...................... RCON 2840 359,381 15.a
b. Trading Liabilities(from Sechedule RC-D)...................... RCFD 3548 5,614,049 15.b

16. Other borrowed money: RCFD
a. With original maturity of one year or less.................... 2332 4,603,402 16.a
b. With original maturity of more than one year................. A547 328,001 16.b
c. With original maturity of more than three years.............. A548 324,984 16.c

17. Not applicable
18. Bank's liability on acceptance executed and outstanding.......... 2920 352,324 18.
19. Subordinated notes and debentures................................ 3200 2,400,000 19.
20. Other liabilities (from Schedule RC-G)........................... 2930 1,833,935 20.
21. Total liabilities (sum of items 13 through 20)................... 2948 56,940,081 21.
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus.................... 3838 0 23.
24. Common stock..................................................... 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)......... 3839 3,192,857 25.
26. a. Undivided profits and capital reserves........................ 3632 1,614,511 26.a
b. Net unrealized holding gains (losses) on available-for-sale
securities.................................................... 8434 27,815 26.b
27. Cumulative foreign currency translation adjustments.............. 3284 (4,851) 27.
28. Total equity capital (sum of items 23 through 27)................ 3210 5,031,190 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)............................ 3300 61,971,271 29.
</TABLE>

Memorandum

To be reported only with the March Report of Condition.

<TABLE>
<S> <C> <C>
1. Indicate in the box at the right the number of the statement below that best describes the most
comprehensive level of auditing work performed for the bank by independent external Number
auditors as of any date during 1996 . . . . . . . . . . . . . . . . . . . . . . . . . . . RCFD 6724... N/A M.1.
</TABLE>

<TABLE>

- -------------------

(1) Includes total demand deposits and noninterest-bearing time and
savings deposits.

<PAGE>

EXHIBIT 25.4

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE

CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)

---------------

THE FIRST NATIONAL BANK OF CHICAGO
(EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER)

A NATIONAL BANKING ASSOCIATION 36-0899825
(I.R.S. EMPLOYER
IDENTIFICATION NUMBER)

ONE FIRST NATIONAL PLAZA, CHICAGO, ILLINOIS 60670-0126
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

---------------
UNIONBANCAL FINANCE TRUST III
(EXACT NAME OF OBLIGORS AS SPECIFIED IN THEIR TRUST AGREEMENTS)

DELAWARE 94-3313845
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)

350 CALIFORNIA STREET
SAN FRANCISCO, CALIFORNIA 94104
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

PREFERRED SECURITIES OF UNIONBANCAL FINANCE TRUST III
(TITLE OF INDENTURE SECURITIES)

<PAGE>

ITEM 1. GENERAL INFORMATION. FURNISH THE FOLLOWING
INFORMATION AS TO THE TRUSTEE:

(a) NAME AND ADDRESS OF EACH EXAMINING OR
SUPERVISING AUTHORITY TO WHICH IT IS SUBJECT.

Comptroller of Currency, Washington, D.C.;
Federal Deposit Insurance Corporation,
Washington, D.C.; The Board of Governors of
the Federal Reserve System, Washington D.C..

(b) WHETHER IT IS AUTHORIZED TO EXERCISE
CORPORATE TRUST POWERS.

The trustee is authorized to exercise corporate
trust powers.

ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR
IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH
SUCH AFFILIATION.

No such affiliation exists with the trustee.

ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A
PART OF THIS STATEMENT OF ELIGIBILITY.

1. A copy of the articles of association of the
trustee now in effect.*

2. A copy of the certificates of authority of the
trustee to commence business.*

3. A copy of the authorization of the trustee to
exercise corporate trust powers.*

4. A copy of the existing by-laws of the trustee.*

5. Not Applicable.

6. The consent of the trustee required by
Section 321(b) of the Act.

<PAGE>

7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.

8. Not Applicable.

9. Not Applicable.

THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE

BY /s/ STEVEN M. WAGNER
--------------------
STEVEN M. WAGNER
FIRST VICE PRESIDENT

* Exhibits 1, 2, 3 and 4 are herein incorporated by reference to Exhibits
bearing identical numbers in Item 16 of the Form T-1 of The First National Bank
of Chicago, filed as Exhibit 25 to the Registration Statement on Form S-3 of U S
WEST Capital Funding, Inc. filed with the Securities and Exchange Commission on
May 6, 1998 (Registration No. 333-51907-01).

<PAGE>

EXHIBIT 6

THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT

January 19, 1999

Securities and Exchange Commission
Washington, D.C. 20549

Gentlemen:

In connection with the qualification of the Amended and Restated Declaration of
Trust of UnionBanCal Finance Trust III, the undersigned, in accordance with
Section 321(b) of the Trust Indenture Act of 1939, as amended, hereby consents
that the reports of examinations of the undersigned, made by Federal or State
authorities authorized to make such examinations, may be furnished by such
authorities to the Securities and Exchange Commission upon its request therefor.

Very truly yours,

THE FIRST NATIONAL BANK OF CHICAGO

BY: /s/ STEVEN M. WAGNER
--------------------
STEVEN M. WAGNER
FIRST VICE PRESIDENT

<PAGE>

CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR SEPTEMBER 30, 1998

All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.

SCHEDULE RC--BALANCE SHEET

<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN THOUSANDS C400
----
RCFD BIL MIL THOU
---- --- --- ----
<S> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A): RCFD
a. Noninterest-bearing balances and currency and coin(1).............. 0081 4,898,646 1.a
b. Interest-bearing balances(2)....................................... 0071 4,612,143 1.b
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A).......... 1754 0 2.a
b. Available-for-sale securities (from Schedule RC-B, column D)....... 1773 9,817,318 2.b
3. Federal funds sold and securities purchased under agreements to
resell................................................................ 1350 6,071,229 3.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule RCFD
RC-C)................................................................. 2122 26,327,215 4.a
b. LESS: Allowance for loan and lease losses.......................... 3123 412,850 4.b
c. LESS: Allocated transfer risk reserve.............................. 3128 0 4.c
d. Loans and leases, net of unearned income, allowance, and RCFD
reserve (item 4.a minus 4.b and 4.c)................................. 2125 25,914,365 4.d
5. Trading assets (from Schedule RD-D)................................... 3545 6,924,064 5.
6. Premises and fixed assets (including capitalized leases).............. 2145 731,747 6.
7. Other real estate owned (from Schedule RC-M).......................... 2150 6,424 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)........................................ 2130 153,385 8.
9. Customers' liability to this bank on acceptances outstanding.......... 2155 352,324 9.
10. Intangible assets (from Schedule RC-M)................................ 2143 295,823 10.
11. Other assets (from Schedule RC-F)..................................... 2160 2,193,803 11.
12. Total assets (sum of items 1 through 11).............................. 2170 61,971,271 12.
</TABLE>
- -------------------

(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.

<PAGE>
<TABLE>
<S> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 09/30/98 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
</TABLE>

SCHEDULE RC-CONTINUED
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN
THOUSANDS
---------
<S> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C RCON
from Schedule RC-E, part 1).................................. 2200 20,965,124 13.a
(1) Noninterest-bearing(1)................................... 6631 9,191,662 13.a1
(2) Interest-bearing ........................................ 6636 11,773,462 13.a2

b. In foreign offices, Edge and Agreement subsidiaries, and RCFN
IBFs (from Schedule RC-E, part II)........................... 2200 15,912,956 13.b
(1) Noninterest bearing...................................... 6631 475,182 13.b1
(2) Interest-bearing......................................... 6636 15,437,774 13.b2
14. Federal funds purchased and securities sold under agreements
to repurchase:.................................................. RCFD 2800 4,245,925 14
15. a. Demand notes issued to the U.S. Treasury..................... RCON 2840 359,381 15.a
b. Trading Liabilities(from Sechedule RC-D)..................... RCFD 3548 5,614,049 15.b

16. Other borrowed money: RCFD
a. With original maturity of one year or less................... 2332 4,603,402 16.a
b. With original maturity of more than one year................ A547 328,001 16.b
c. With original maturity of more than three years ............ A548 324,984 16.c

17. Not applicable
18. Bank's liability on acceptance executed and outstanding......... 2920 352,324 18.
19. Subordinated notes and debentures............................... 3200 2,400,000 19.
20. Other liabilities (from Schedule RC-G).......................... 2930 1,833,935 20.
21. Total liabilities (sum of items 13 through 20).................. 2948 56,940,081 21.
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus................... 3838 0 23.
24. Common stock.................................................... 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)........ 3839 3,192,857 25.
26. a. Undivided profits and capital reserves ...................... 3632 1,614,511 26.a
b. Net unrealized holding gains (losses) on available-for-sale
securities.................................................. 8434 27,815 26.b
27. Cumulative foreign currency translation adjustments............. 3284 (4,851) 27.
28. Total equity capital (sum of items 23 through 27)............... 3210 5,031,190 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)........................... 3300 61,971,271 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
<TABLE>
<S> <C> <C>
1. Indicate in the box at the right the number of the statement below that best describes the most
comprehensive level of auditing work performed for the bank by independent external Number
auditors as of any date during 1996 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . RCFD 6724 . . N/A M.1.
</TABLE>

<TABLE>
<S> <C>
1 = Independent audit of the bank conducted in accordance 4. = Directors' examination of the bank performed by other
with generally accepted auditing standards by a certified external auditors (may be required by state chartering
public accounting firm which submits a report on the bank authority)
2 = Independent audit of the bank's parent holding company 5 = Review of the bank's financial statements by external
conducted in accordance with generally accepted auditing auditors
standards by a certified public accounting firm which 6 = Compilation of the bank's financial statements by external
submits a report on the consolidated holding company auditors
(but not on the bank separately) 7 = Other audit procedures (excluding tax preparation work)
3 = Directors' examination of the bank conducted in 8 = No external audit work
accordance with generally accepted auditing standards
by a certified public accounting firm (may be required by
state chartering authority)
</TABLE>

- ------------------

(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.

<PAGE>

EXHIBIT 25.5

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM T-1

STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE

CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)

---------------

THE FIRST NATIONAL BANK OF CHICAGO
(EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER)

A NATIONAL BANKING ASSOCIATION 36-0899825
(I.R.S. EMPLOYER
IDENTIFICATION NUMBER)

ONE FIRST NATIONAL PLAZA, CHICAGO, ILLINOIS 60670-0126
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

---------------
UNIONBANCAL FINANCE TRUST IV
(EXACT NAME OF OBLIGORS AS SPECIFIED IN THEIR TRUST AGREEMENTS)

DELAWARE 94-3313846
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)

350 CALIFORNIA STREET
SAN FRANCISCO, CALIFORNIA 94104
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

PREFERRED SECURITIES OF UNIONBANCAL FINANCE TRUST IV
(TITLE OF INDENTURE SECURITIES)

<PAGE>

ITEM 1. GENERAL INFORMATION. FURNISH THE FOLLOWING
INFORMATION AS TO THE TRUSTEE:

(a) NAME AND ADDRESS OF EACH EXAMINING OR
SUPERVISING AUTHORITY TO WHICH IT IS SUBJECT.

Comptroller of Currency, Washington, D.C.;
Federal Deposit Insurance Corporation,
Washington, D.C.; The Board of Governors of
the Federal Reserve System, Washington D.C..

(b) WHETHER IT IS AUTHORIZED TO EXERCISE
CORPORATE TRUST POWERS.

The trustee is authorized to exercise corporate
trust powers.

ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR
IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH
SUCH AFFILIATION.

No such affiliation exists with the trustee.

ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A
PART OF THIS STATEMENT OF ELIGIBILITY.

1. A copy of the articles of association of the
trustee now in effect.*

2. A copy of the certificates of authority of the
trustee to commence business.*

3. A copy of the authorization of the trustee to
exercise corporate trust powers.*

4. A copy of the existing by-laws of the trustee.*

5. Not Applicable.

6. The consent of the trustee required by
Section 321(b) of the Act.

<PAGE>

7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.

8. Not Applicable.

9. Not Applicable.

THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE

BY /s/ STEVEN M. WAGNER
---------------------------------------
STEVEN M. WAGNER
FIRST VICE PRESIDENT

* Exhibits 1, 2, 3 and 4 are herein incorporated by reference to Exhibits
bearing identical numbers in Item 16 of the Form T-1 of The First National Bank
of Chicago, filed as Exhibit 25 to the Registration Statement on Form S-3 of U S
WEST Capital Funding, Inc. filed with the Securities and Exchange Commission on
May 6, 1998 (Registration No. 333-51907-01).

<PAGE>

EXHIBIT 6

THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT

January 19, 1999

Securities and Exchange Commission
Washington, D.C. 20549

Gentlemen:

In connection with the qualification of the Amended and Restated Declaration
of Trust of UnionBanCal Finance Trust IV, the undersigned, in accordance with
Section 321(b) of the Trust Indenture Act of 1939, as amended, hereby
consents that the reports of examinations of the undersigned, made by Federal
or State authorities authorized to make such examinations, may be furnished
by such authorities to the Securities and Exchange Commission upon its
request therefor.

Very truly yours,

THE FIRST NATIONAL BANK OF CHICAGO

BY /s/ STEVEN M. WAGNER
---------------------------------------
STEVEN M. WAGNER
FIRST VICE PRESIDENT

<PAGE>

EXHIBIT 7

<TABLE>
<S> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 09/30/98 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
</TABLE>

CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR SEPTEMBER 30, 1998

All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.

SCHEDULE RC--BALANCE SHEET

<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN THOUSANDS C400
RCFD BIL MIL THOU ----
---- ------------
<S> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A): RCFD
a. Noninterest-bearing balances and currency and coin(1).............. 0081 4,898,646 1.a
b. Interest-bearing balances(2)....................................... 0071 4,612,143 1.b
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A).......... 1754 0 2.a
b. Available-for-sale securities (from Schedule RC-B, column D)....... 1773 9,817,318 2.b
3. Federal funds sold and securities purchased under agreements to
resell................................................................ 1350 6,071,229 3.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule RCFD
RC-C)................................................................. 2122 26,327,215 4.a
b. LESS: Allowance for loan and lease losses.......................... 3123 412,850 4.b
c. LESS: Allocated transfer risk reserve.............................. 3128 0 4.c
d. Loans and leases, net of unearned income, allowance, and RCFD
reserve (item 4.a minus 4.b and 4.c).................................. 2125 25,914,365 4.d
5. Trading assets (from Schedule RD-D)................................... 3545 6,924,064 5.
6. Premises and fixed assets (including capitalized leases).............. 2145 731,747 6.
7. Other real estate owned (from Schedule RC-M).......................... 2150 6,424 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)........................................ 2130 153,385 8.
9. Customers' liability to this bank on acceptances outstanding.......... 2155 352,324 9.
10. Intangible assets (from Schedule RC-M)................................ 2143 295,823 10.
11. Other assets (from Schedule RC-F)..................................... 2160 2,193,803 11.
12. Total assets (sum of items 1 through 11).............................. 2170 61,971,271 12.

- --------------
</TABLE>

(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.

<PAGE>

SCHEDULE RC-CONTINUED

<TABLE>
DOLLAR AMOUNTS IN
THOUSANDS
-----------------
<S> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C RCON
from Schedule RC-E, part 1)................................... 2200 20,965,124 13.a
(1) Noninterest-bearing(1).................................... 6631 9,191,662 13.a1
(2) Interest-bearing.......................................... 6636 11,773,462 13.a2
b. In foreign offices, Edge and Agreement subsidiaries, and RCFN
IBFs (from Schedule RC-E, part II)............................ 2200 15,912,956 13.b
(1) Noninterest bearing....................................... 6631 475,182 13.b1
(2) Interest-bearing.......................................... 6636 15,437,774 13.b2
14. Federal funds purchased and securities sold under agreements
to repurchase:................................................... RCFD 2800 4,245,925 14
15. a. Demand notes issued to the U.S. Treasury...................... RCON 2840 359,381 15.a
b. Trading Liabilities(from Sechedule RC-D)...................... RCFD 3548 5,614,049 15.b
16. Other borrowed money: RCFD
a. With original maturity of one year or less.................... 2332 4,603,402 16.a
b. With original maturity of more than one year................. A547 328,001 16.b
c. With original maturity of more than three years............... A548 324,984 16.c
17. Not applicable
18. Bank's liability on acceptance executed and outstanding.......... 2920 352,324 18.
19. Subordinated notes and debentures................................ 3200 2,400,000 19.
20. Other liabilities (from Schedule RC-G)........................... 2930 1,833,935 20.
21. Total liabilities (sum of items 13 through 20)................... 2948 56,940,081 21.
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus.................... 3838 0 23.
24. Common stock..................................................... 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)......... 3839 3,192,857 25.
26. a. Undivided profits and capital reserves........................ 3632 1,614,511 26.a
b. Net unrealized holding gains (losses) on available-for-sale
securities.................................................... 8434 27,815 26.b
27. Cumulative foreign currency translation adjustments.............. 3284 (4,851) 27.
28. Total equity capital (sum of items 23 through 27)................ 3210 5,031,190 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)............................ 3300 61,971,271 29.

Memorandum
To be reported only with the March Report of Condition.

1. Indicate in the box at the right the number of the statement
below that best describes the most comprehensive level of
auditing work performed for the bank by independent external Number
auditors as of any date during 1996. . . . . . . . . . . . . RCFD 6724 .... N/A M.1.

1 = Independent audit of the bank conducted in accordance 4. = Directors' examination of the bank performed by other
with generally accepted auditing standards by a certified external auditors (may be required by state chartering
public accounting firm which submits a report on the bank authority)
2 = Independent audit of the bank's parent holding company 5 = Review of the bank's financial statements by external
conducted in accordance with generally accepted auditing auditors
standards by a certified public accounting firm which 6 = Compilation of the bank's financial statements by external
submits a report on the consolidated holding company auditors
(but not on the bank separately) 7 = Other audit procedures (excluding tax preparation work)
3 = Directors' examination of the bank conducted in 8 = No external audit work
accordance with generally accepted auditing standards
by a certified public accounting firm (may be required by
state chartering authority)

- ---------------
</TABLE>

(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.