MUFG Americas Holdings Corp - FORM 8-K - EX-99.1 - EXHIBIT 99.1

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8-K - UNIONBANCAL CORPORATION 8-K - MUFG Americas Holdings Corp	a6700558.htm

Exhibit 99.1

UnionBanCal Corporation Reports First Quarter Net Income of $235 Million

First Quarter Highlights:

Net income was $235 million, up from $172 million for fourth quarter 2010, and $77 million for the year-ago quarter.
Total provision for credit losses was a benefit of $115 million, compared with a benefit of $42 million for the prior quarter, and expense of $165 million for the year-ago quarter.
Asset quality improved in first quarter. Excluding FDIC covered assets:
- Net charge-off ratio was 0.46 percent annualized, down from 0.54 percent annualized prior quarter.
- Nonperforming assets at quarter-end were $815 million, or 1.03 percent of total assets, down from $890 million, or 1.15 percent of total assets, prior quarter.
Allowance for credit losses to nonaccrual loans, excluding FDIC covered assets, was 148 percent at quarter-end, down from 156 percent prior quarter.
Net interest margin was 3.49 percent, down 4 basis points from the prior quarter, and up 51 basis points from the year-ago quarter.
Annualized average all-in cost of funds was 0.51 percent for the quarter, up from 0.49 percent for the prior quarter.
Capital levels strengthened during the quarter:
- Tangible common equity ratio was 9.80 percent at March 31, 2011, versus 9.67 percent at December 31, 2010.
- Tier 1 common capital ratio was 12.84 percent at March 31, 2011, versus 12.42 percent at December 31, 2010.

SAN FRANCISCO--(BUSINESS WIRE)--April 28, 2011--UnionBanCal Corporation (the Company or UB), parent company of San Francisco-based Union Bank, N.A., today reported first quarter 2011 results. Net income for the first quarter was $235 million, up from $172 million for fourth quarter 2010, and $77 million for the year-ago quarter. The improvement in net income compared with prior quarter was primarily driven by lower noninterest expense and a larger benefit from the reversal of provision for credit losses.

Summary of First Quarter Results

First Quarter Total Revenue and Net Interest Income

For first quarter 2011, total revenue (net interest income plus noninterest income) was $858 million, down $24 million, or 3 percent, compared with prior quarter. Net interest income decreased 2 percent, and noninterest income decreased 4 percent.

Net interest income for first quarter 2011 was $618 million, down $13 million, or 2 percent, compared with fourth quarter 2010, primarily reflecting a lower average yield on total loans, partially offset by higher yields on securities.

Average total loans increased $331 million, or 1 percent, compared with fourth quarter 2010. Excluding FDIC covered loans, average total loans increased $501 million, or 1 percent. Average FDIC covered loans decreased $170 million, or 11 percent, due to expected runoff of the portfolio. Average noninterest bearing deposits increased $657 million, or 4 percent. Average interest bearing deposits decreased $3 billion, or 6 percent, primarily due to planned deposit runoff resulting from targeted rate reductions.

The net interest margin was 3.49 percent for first quarter 2011, down 4 basis points from fourth quarter 2010. The decrease in the net interest margin was primarily due to a lower average yield on total loans, partially offset by a higher average yield on the securities portfolio, reflecting a continued portfolio remix. Rates paid on total interest bearing deposits were flat compared with fourth quarter 2010.

The annualized average all-in cost of funds was 0.51 percent in first quarter 2011, compared with 0.49 percent in fourth quarter 2010. The Company’s average loan-to-deposit ratio was 81 percent in first quarter 2011, compared with 78 percent in fourth quarter 2010.

Compared with first quarter 2010, total revenue increased 9 percent, with net interest income up 8 percent and noninterest income up 14 percent. Average total loans increased 3 percent, due to the acquisition of the loan portfolios of Frontier Bank and Tamalpais Bank in second quarter 2010. Average noninterest bearing deposits increased $3 billion, or 19 percent. Average interest bearing deposits decreased $11 billion, or 21 percent, primarily due to planned deposit runoff resulting from targeted rate reductions. The net interest margin, which increased 51 basis points compared with the year-ago quarter, benefited from an improved earning assets mix, including a favorable loan mix change due to the addition of FDIC covered loans; lower rates paid on a lower volume of interest bearing liabilities; and a decreased volume of low-yielding interest bearing deposits in banks.

First Quarter Noninterest Income and Noninterest Expense

For first quarter 2011, noninterest income was $240 million, down $11 million, or 4 percent, from prior quarter. The decrease was primarily due to a $9 million decrease in merchant banking fees and a $5 million decrease in gains on the sale of securities. Other noninterest income in first quarter 2011 included a $15 million gain on the sale of MasterCard shares, partially offset by an accretion adjustment to the indemnification assets associated with FDIC covered loans.

Noninterest income increased $30 million, or 14 percent, compared with first quarter 2010, primarily due to a $12 million increase in fees from trading account activities and a $20 million increase in other noninterest income, which was primarily due to a $15 million gain on the sale of MasterCard shares. These increases were partially offset by a $9 million decrease in service charges on deposit accounts, reflecting lower overdraft volumes, and a $6 million decrease in gains on the sale of securities.

Noninterest expense for first quarter 2011 was $615 million, down $86 million, or 12 percent, compared with fourth quarter 2010. The decrease was primarily due to a $59 million decrease in other noninterest expense, a $12 million decrease in professional and outside services expense, and a $5 million decrease in regulatory agencies expense. The decrease in other noninterest expense was primarily due to certain reserves for contingencies and an asset impairment charge, recorded in fourth quarter 2010. The decrease in regulatory agencies expense was primarily due to a decrease in the FDIC insurance rate for deposits and lower deposit balances. The provision for losses on off-balance sheet commitments was a benefit of $13 million in first quarter 2011, compared with a benefit of $2 million in fourth quarter 2010.

Noninterest expense for first quarter 2011 increased $90 million, or 17 percent, compared with first quarter 2010. Salaries and employee benefits expense increased $64 million, primarily due to increased staffing levels, which was partially attributable to the second quarter 2010 Frontier Bank and Tamalpais Bank acquisitions. Other noninterest expense increased $39 million, primarily due to certain reserves for contingencies recorded in first quarter 2011. The provision for losses on off-balance sheet commitments was a benefit of $13 million, compared with a benefit of $5 million in first quarter 2010.

Balance Sheet

At March 31, 2011, the Company had total assets of $80.6 billion, up $1.5 billion, or 2 percent, compared with December 31, 2010, and down $4.8 billion, or 6 percent, compared with March 31, 2010.

At March 31, 2011, total deposits were $59 billion, down $1.3 billion, or 2 percent, compared with December 31, 2010, and down $7.9 billion, or 12 percent, compared with March 31, 2010. Core deposits at March 31, 2011, were $48 billion, down $0.6 billion, or 1 percent, compared with December 31, 2010, and down $5.1 billion, or 10 percent, compared with March 31, 2010. The decline in total deposits and core deposits reflects planned runoff of targeted higher rate deposits. At March 31, 2011, the Company’s loan-to-deposit ratio was 82 percent, up from 80 percent at December 31, 2010, and up from 70 percent at March 31, 2010.

Credit Quality

The total provision for credit losses was a benefit of $115 million for first quarter 2011, compared with a benefit of $42 million for fourth quarter 2010, as asset quality continued to improve overall. Nonperforming assets, excluding FDIC covered assets, declined $75 million, or 8 percent, and net charge-offs declined $11 million, or 17 percent, compared with prior quarter.

Excluding FDIC covered assets, nonperforming assets were $815 million, or 1.03 percent of total assets at March 31, 2011, compared with $890 million, or 1.15 percent of total assets, at December 31, 2010, and $1,467 million, or 1.72 percent of total assets, at March 31, 2010.

Net charge-offs for first quarter 2011 were $53 million, down from $64 million for fourth quarter 2010. As a percent of average total loans, excluding FDIC covered assets, net charge-offs for first quarter 2011 were 0.46 percent annualized, down from 0.54 percent annualized for fourth quarter 2010. For first quarter 2010, net charge-offs were $119 million, or 1.03 percent annualized of average total loans.

The total provision for credit losses is comprised of the provision for loan losses and the provision for losses on off-balance sheet commitments, which is classified in noninterest expense. In first quarter 2011, the provision for loan losses was a benefit of $102 million and the provision for losses on off-balance sheet commitments was a benefit of $13 million.

The allowance for credit losses as a percent of total loans, excluding FDIC covered loans, was 2.48 percent at March 31, 2011, compared with 2.85 percent at December 31, 2010, and 3.38 percent at March 31, 2010. The allowance for credit losses as a percent of nonaccrual loans, excluding FDIC covered loans, was 148 percent at March 31, 2011, compared with 156 percent at December 31, 2010, and 111 percent at March 31, 2010.

Capital

Total stockholder’s equity was $10.4 billion and tangible common equity was $7.6 billion at March 31, 2011. The Company’s tangible common equity ratio was 9.80 percent at March 31, 2011, up 13 basis points from 9.67 percent at December 31, 2010, and up 133 basis points from 8.47 percent at March 31, 2010. The Tier 1 common capital ratio at March 31, 2011, was 12.84 percent, compared with 12.42 percent at December 31, 2010. The Company’s Tier 1 and total risk-based capital ratios at March 31, 2011, were 12.84 percent and 15.41 percent, respectively.

Non-GAAP Financial Measures

This press release contains certain references to financial measures identified as excluding privatization transaction expenses, foreclosed asset expense, (reversal of) provision for losses on off-balance sheet commitments, low income housing credit investment amortization expense, expenses of the consolidated variable interest entities, merger costs related to acquisitions, or asset impairment charges, which are adjustments from comparable measures calculated and presented in accordance with accounting principles generally accepted in the United States of America (GAAP). These financial measures, as used herein, differ from financial measures reported under GAAP in that they exclude unusual or non-recurring charges, losses or credits. This press release identifies the specific items excluded from the comparable GAAP financial measure in the calculation of each non-GAAP financial measure. Management believes that financial presentations excluding the impact of these items provide useful supplemental information which is important to a proper understanding of the Company’s core business results. This press release also includes additional capital ratios (the tangible common equity and Tier 1 common capital ratios) to facilitate the understanding of the Company’s capital structure and for use in assessing and comparing the quality and composition of UnionBanCal’s capital structure to other financial institutions. These presentations should not be viewed as a substitute for results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP financial measures presented by other companies.

Headquartered in San Francisco, UnionBanCal Corporation is a financial holding company with assets of $80.6 billion at March 31, 2011. Its primary subsidiary, Union Bank, N.A., is a full-service commercial bank providing an array of financial services to individuals, small businesses, middle-market companies, and major corporations. The bank operated 401 banking offices in California, Washington, Oregon and Texas, as well as two international offices, on March 31, 2011. UnionBanCal Corporation is a wholly-owned subsidiary of The Bank of Tokyo-Mitsubishi UFJ, Ltd., which is a subsidiary of Mitsubishi UFJ Financial Group, Inc. Union Bank is a proud member of the Mitsubishi UFJ Financial Group (MUFG, NYSE:MTU), one of the world’s largest financial organizations. Visit www.unionbank.com for more information.


UnionBanCal Corporation and Subsidiaries
Financial Highlights (Unaudited)
Exhibit 1
	As of and for the Three Months Ended																	Percent Change to March 31, 2011 from
(Dollars in millions)	March 31, 2011				December 31, 2010				September 30, 2010			June 30, 2010			March 31, 2010			December 31, 2010			March 31, 2010
Results of operations:
Net interest income	$	618			$	631			$	618		$	601		$	574		(2	)	%	8		%
Noninterest income		240				251				218			244			210		(4	)		14
Total revenue		858				882				836			845			784		(3	)		9
Noninterest expense		615				701				562			584			525		(12	)		17
Pre-tax, pre-provision income		243				181				274			261			259		34			(6	)
(Reversal of) provision for loan losses		(102	)			(40	)			8			44			170		(155	)		nm
Income before income taxes and including noncontrolling interests		345				221				266			217			89		56			288
Income tax expense		114				58				99			67			15		97			nm
Net income including noncontrolling interests		231				163				167			150			74		42			212
Deduct: Net loss from noncontrolling interests		4				9				3			4			3		(56	)		33
Net income attributable to UnionBanCal Corporation (UNBC)	$	235			$	172			$	170		$	154		$	77		37			205

Balance sheet (end of period):
Total assets	$	80,642			$	79,097			$	79,840		$	84,310		$	85,471		2			(6	)
Total securities		21,673				22,114				19,630			23,055			23,413		(2	)		(7	)
Total loans held for investment		48,105				48,094				47,893			48,320			46,718		-			3
Core deposits ⁽³⁾		48,018				48,666				50,596			52,935			53,073		(1	)		(10	)
Total deposits		58,677				59,954				61,541			66,271			66,581		(2	)		(12	)
Long-term debt		6,078				5,598				4,458			4,716			4,724		9			29
UNBC stockholder's equity		10,355				10,125				10,134			9,942			9,706		2			7

Balance sheet (period average):
Total assets	$	80,056			$	80,182			$	82,265		$	85,511		$	84,810		-			(6	)
Total securities		21,601				21,560				22,487			23,089			23,546		-			(8	)
Total loans held for investment		48,283				47,952				48,105			47,827			46,848		1			3
Earning assets		71,351				71,517				73,603			77,412			77,660		-			(8	)
Core deposits ⁽³⁾		48,399				50,778				52,299			54,381			54,588		(5	)		(11	)
Total deposits		59,471				61,728				64,822			68,104			67,838		(4	)		(12	)
UNBC stockholder's equity		10,167				10,034				9,913			9,631			9,532		1			7

Performance ratios:
Return on average assets ⁽²⁾		1.19		%		0.85		%		0.82	%		0.72	%		0.37	%
Return on average UNBC stockholder's equity ⁽²⁾		9.38				6.81				6.80			6.40			3.29
Core efficiency ratio ⁽⁴⁾		68.80				70.88				63.69			64.86			64.98
Net interest margin ^{(1) (2)}		3.49				3.53				3.36			3.11			2.98

Capital ratios:
Tier 1 risk-based capital ratio ⁽⁷⁾		12.84		%		12.44		%		12.27	%		11.95	%		11.98	%
Total risk-based capital ratio ⁽⁷⁾		15.41				15.01				14.97			14.64			14.70
Leverage ratio ⁽⁷⁾		10.66				10.34				9.86			9.23			9.22
Tier 1 common capital ratio ^{(6) (7)}		12.84				12.42				12.25			11.93			11.96
Tangible common equity ratio ⁽⁵⁾		9.80				9.67				9.56			8.79			8.47

Selected financial ratios excluding impact of privatization transaction ⁽¹¹⁾:
From net income attributable to UNBC:
Return on average assets ⁽²⁾		1.24		%		0.92		%		0.89	%		0.78	%		0.44	%
Return on average stockholder's equity ⁽²⁾		12.41				9.32				9.43			9.01			5.10
Core efficiency ratio⁽⁴⁾		67.47				68.83				61.13			62.39			61.51

Refer to Exhibit 10 for footnote explanations.

UnionBanCal Corporation and Subsidiaries
Credit Quality (Unaudited)
Exhibit 2
	As of and for the Three Months Ended																			Percent Change to March 31, 2011 from
(Dollars in millions)	March 31, 2011				December 31, 2010				September 30, 2010				June 30, 2010			March 31, 2010				December 31, 2010			March 31, 2010

Credit Data:
(Reversal of) provision for loan losses, excluding FDIC covered loans	$	(102	)		$	(48	)		$	8			$	44		$	170			(113	)	%	nm		%

Provision for FDIC covered loan losses not subject to FDIC indemnification		-				8				-				-			-			(100	)		-
(Reversal of) provision for off-balance sheet commitments		(13	)			(2	)			(8	)			1			(5	)		nm			(160	)
Total (reversal of) provision for credit losses	$	(115	)		$	(42	)		$	-			$	45		$	165			(174	)		nm
Net charge-offs	$	53			$	64			$	89			$	94		$	119			(17	)		(55	)
Nonperforming assets		1,032				1,142				1,487				1,561			1,467			(10	)		(30	)

Credit Ratios:
Allowance for loan losses to:
Total loans held for investment		2.15		%		2.48		%		2.67		%		2.81	%		3.01		%
Nonaccrual loans		118.50				123.40				98.38				100.38			99.06
Allowances for credit losses to ⁽⁸⁾:
Total loans held for investment		2.46				2.81				3.01				3.17			3.38
Nonaccrual loans		135.61				140.23				111.04				113.13			111.11
Net loans charged off to average total loans held for investment ⁽²⁾		0.44				0.52				0.74				0.78			1.03
Nonperforming assets to total loans held for investment and OREO		2.14				2.37				3.09				3.22			3.14
Nonperforming assets to total assets		1.28				1.44				1.86				1.85			1.72
Nonaccrual loans to total loans held for investment		1.81				2.01				2.71				2.80			3.04

Excluding FDIC covered assets ⁽¹²⁾:
Allowance for loan losses to:
Total loans held for investment		2.17		%		2.50		%		2.76		%		2.92	%		3.01		%
Nonaccrual loans		129.10				137.32				110.48				102.17			99.06
Allowances for credit losses to ⁽⁸⁾:
Total loans held for investment		2.48				2.85				3.12				3.29			3.38
Nonaccrual loans		148.17				156.44				124.70				115.14			111.11
Net loans charged off to average total loans held for investment ⁽²⁾		0.46				0.54				0.77				0.81			1.03
Nonperforming assets to total loans held for investment and OREO		1.74				1.91				2.60				2.97			3.14
Nonperforming assets to total assets		1.03				1.15				1.54				1.68			1.72
Nonaccrual loans to total loans held for investment		1.68				1.82				2.50				2.86			3.04

Refer to Exhibit 10 for footnote explanations.

UnionBanCal Corporation and Subsidiaries
Consolidated Statements of Income (Unaudited)
Exhibit 3




			For the Three Months Ended
(Dollars in millions)			March 31, 2011			December 31, 2010			September 30, 2010			June 30, 2010		March 31, 2010
Interest Income
	Loans		$	559		$	576		$	582		$	568	$	540
	Securities			143			137			132			135		143
	Interest income - other			1			1			2			5		5
		Total interest income		703			714			716			708		688

Interest Expense
	Deposits			53			56			70			78		86
	Commercial paper and other short-term borrowings			1			-			1			2		1
	Long-term debt			31			27			27			27		27
		Total interest expense		85			83			98			107		114

Net Interest Income				618			631			618			601		574
	(Reversal of) provision for loan losses			(102	)		(40	)		8			44		170
		Net interest income after (reversal of) provision for loan losses		720			671			610			557		404

Noninterest Income
	Service charges on deposit accounts			57			58			62			64		66
	Trust and investment management fees			34			34			33			35		31
	Trading account activities			33			33			32			25		21
	Merchant banking fees			19			28			19			22		14
	Securities gains, net			28			33			11			27		34
	Brokerage commissions and fees			13			10			11			10		9
	Card processing fees, net			10			10			10			12		9
	Other			46			45			40			49		26
		Total noninterest income		240			251			218			244		210

Noninterest Expense
	Salaries and employee benefits			344			338			293			319		280
	Net occupancy and equipment			65			64			65			64		59
	Professional and outside services			44			56			54			50		39
	Intangible asset amortization			25			31			31			30		32
	Regulatory agencies			21			26			30			30		30
	(Reversal of) provision for losses on off-balance sheet commitments			(13	)		(2	)		(8	)		1		(5	)
	Other			129			188			97			90		90
		Total noninterest expense		615			701			562			584		525

	Income before income taxes and including noncontrolling interests			345			221			266			217		89
	Income tax expense			114			58			99			67		15
Net Income including Noncontrolling Interests				231			163			167			150		74
	Deduct: Net loss from noncontrolling interests			4			9			3			4		3
Net Income attributable to UNBC			$	235		$	172		$	170		$	154	$	77

UnionBanCal Corporation and Subsidiaries
Consolidated Balance Sheets
Exhibit 4

(Dollars in millions)			(Unaudited) March 31, 2011			December 31, 2010			(Unaudited) September 30, 2010			(Unaudited) June 30, 2010			(Unaudited) March 31, 2010
Assets
		Cash and due from banks	$	1,247		$	946		$	1,172		$	1,221		$	1,110
		Interest bearing deposits in banks (includes $23 at March 31, 2011, $11 at December 31, 2010, $9 at September 30, 2010, $13 at June 30, 2010 and $10 at March 31, 2010 related to consolidated variable interest entities (VIEs))		1,912			217			2,419			2,873			6,874
		Federal funds sold and securities purchased under resale agreements		24			11			595			288			489
		Total cash and cash equivalents		3,183			1,174			4,186			4,382			8,473
Trading account assets:
		Pledged as collateral		6			43			37			64			54
		Held in portfolio		870			956			1,134			1,055			776
Securities available for sale:
		Pledged as collateral		308			10			-			-			-
		Held in portfolio		20,026			20,781			18,327			21,789			22,165
Securities held to maturity (Fair value: March 31, 2011, $1,646; December 31, 2010, $1,560; September 30, 2010, $1,481; June 30, 2010, $1,434 and March 31, 2010, $1,501)				1,339			1,323			1,303			1,266			1,248
Loans held for investment:
	Loans, excluding FDIC covered loans			46,715			46,584			46,214			46,496			46,718
	FDIC covered loans			1,390			1,510			1,679			1,824			-
		Total loans held for investment		48,105			48,094			47,893			48,320			46,718
		Allowance for loan losses		(1,034	)		(1,191	)		(1,277	)		(1,358	)		(1,408	)
		Loans held for investment, net		47,071			46,903			46,616			46,962			45,310
Premises and equipment, net				694			712			674			671			671
Intangible assets, net				432			457			487			517			529
Goodwill				2,447			2,456			2,456			2,456			2,369
FDIC indemnification asset				699			783			824			907			-
Other assets (includes $277 at March 31, 2011, $283 at December 31, 2010, $291 at September 30, 2010, $294 at June 30, 2010 and $298 at March 31, 2010 related to consolidated VIEs)				3,567			3,499			3,796			4,241			3,876
		Total assets	$	80,642		$	79,097		$	79,840		$	84,310		$	85,471

Liabilities
		Noninterest bearing	$	18,062		$	16,343		$	15,426		$	15,319		$	14,389
		Interest bearing		40,615			43,611			46,115			50,952			52,192
		Total deposits		58,677			59,954			61,541			66,271			66,581
Commercial paper and other short-term borrowings				3,260			1,356			977			999			2,209
Trading account liabilities				696			774			1,010			815			737
Other liabilities (includes $2 at March 31, 2011, December 31, 2010, September 30, 2010, June 30, 2010 and March 31, 2010 related to consolidated VIEs)				1,303			1,024			1,447			1,289			1,232
Long-term debt (includes $8 at March 31, 2011, December 31, 2010, September 30, 2010, June 30, 2010 and March 31, 2010 related to consolidated VIEs)				6,078			5,598			4,458			4,716			4,724
		Total liabilities		70,014			68,706			69,433			74,090			75,483


Equity
UNBC Stockholder's Equity:
	Common stock, par value $1 per share:
		Authorized 300,000,000 shares; 136,330,829 shares issued		136			136			136			136			136
	Additional paid-in capital			5,201			5,198			5,195			5,195			5,195
	Retained earnings			5,703			5,468			5,296			5,131			4,977
	Accumulated other comprehensive loss			(685	)		(677	)		(493	)		(520	)		(602	)
		Total UNBC stockholder's equity		10,355			10,125			10,134			9,942			9,706
	Noncontrolling interests			273			266			273			278			282
		Total equity		10,628			10,391			10,407			10,220			9,988
		Total liabilities and equity	$	80,642		$	79,097		$	79,840		$	84,310		$	85,471

Refer to Exhibit 10 for footnote explanations.

UnionBanCal Corporation and Subsidiaries
Loans and Nonperforming Assets (Unaudited)
Exhibit 5



(Dollars in millions)				March 31, 2011		December 31, 2010		September 30, 2010		June 30, 2010		March 31, 2010

Loans held for investment (period end)
	Loans held for investment, excluding FDIC covered loans:
		Commercial, financial and industrial		$	15,143	$	15,162	$	14,650	$	14,675	$	14,870
		Construction			1,153		1,460		1,850		2,114		2,151
		Residential mortgage			18,110		17,531		17,295		17,089		16,893
		Commercial mortgage			7,749		7,816		7,893		8,062		8,249
		Consumer			3,787		3,858		3,891		3,914		3,914
		Lease financing			773		757		635		642		641

			Total loans held for investment, excluding FDIC covered loans		46,715		46,584		46,214		46,496		46,718
	FDIC covered loans:
		Commercial, financial and industrial			387		433		495		554		-
		Construction			184		222		251		273		-
		Residential mortgage			77		81		88		117		-
		Commercial mortgage			707		733		796		818		-
		Consumer			35		41		49		62		-
			Total FDIC covered loans		1,390		1,510		1,679		1,824		-

			Total loans held for investment	$	48,105	$	48,094	$	47,893	$	48,320	$	46,718

Nonperforming Assets (period end)
	Nonaccrual loans:
		Commercial, financial and industrial		$	113	$	115	$	167	$	176	$	257
		Construction			71		140		244		373		412
		Residential mortgage			241		243		237		245		227
		Commercial mortgage			265		329		481		510		501
		Consumer			22		22		27		25		24
		Lease financing			71		-		-		-		-
			Total nonaccrual loans, excluding FDIC covered loans		783		849		1,156		1,329		1,421
		FDIC covered loans			90		116		142		24		-
			Total nonaccrual loans		873		965		1,298		1,353		1,421

	OREO				32		41		47		52		46
	FDIC covered OREO				127		136		142		156		-

			Total nonperforming assets	$	1,032	$	1,142	$	1,487	$	1,561	$	1,467

			Total nonperforming assets, excluding FDIC covered assets	$	815	$	890	$	1,203	$	1,381	$	1,467

	Loans 90 days or more past due and still accruing ⁽¹³⁾			$	3	$	2	$	17	$	6	$	15
	Restructured loans that are still accruing			$	45	$	22	$	25	$	9	$	7
	Restructured nonaccrual loans (included in total nonaccrual loans above)			$	189	$	198	$	149	$	88	$	16

Refer to Exhibit 10 for footnote explanations.

UnionBanCal Corporation and Subsidiaries
Allowances for Credit Losses (Unaudited)
Exhibit 6


					As of and for the Three Months Ended
(Dollars in millions)					March 31, 2011			December 31, 2010			September 30, 2010			June 30, 2010			March 31, 2010

Analysis of Allowances for Credit Losses
	Balance, beginning of period				$	1,191		$	1,277		$	1,358		$	1,408		$	1,357
	(Reversal of) provision for loan losses, excluding FDIC covered loans					(102	)		(48	)		8			44			170
	Provision for FDIC covered loan losses not subject to FDIC indemnification					-			8			-			-			-
	Increase (decrease) in allowance covered by FDIC indemnification					(2	)		17			-			-			-
	Other					-			1			-			-			-

	Loans charged off:
		Commercial, financial and industrial				(23	)		(18	)		(37	)		(30	)		(67	)
		Construction				(1	)		(4	)		(2	)		(10	)		(16	)
		Residential mortgage				(14	)		(8	)		(25	)		(12	)		(10	)
		Commercial mortgage				(24	)		(51	)		(27	)		(51	)		(32	)
		Consumer				(11	)		(15	)		(11	)		(9	)		(10	)
			Total loans charged off			(73	)		(96	)		(102	)		(112	)		(135	)

	Recoveries of loans previously charged off:
		Commercial, financial and industrial				7			19			5			8			13
		Construction				4			3			7			8			2
		Residential mortgage				-			1			-			-			-
		Commercial mortgage				8			8			1			2			-
		Consumer				1			1			-			-			1
			Total recoveries of loans previously charged off			20			32			13			18			16
				Net loans charged off		(53	)		(64	)		(89	)		(94	)		(119	)

	Ending balance of allowance for loan losses					1,034			1,191			1,277			1,358			1,408
	Allowance for losses on off-balance sheet commitments					150			162			164			172			171
	Allowances for credit losses				$	1,184		$	1,353		$	1,441		$	1,530		$	1,579

Components of allowance for loan losses:

	Allowance for loan losses, excluding allowance on FDIC covered loans				$	1,011		$	1,166		$	1,277		$	1,358		$	1,408
	Allowance for loan losses on FDIC covered loans					23			25			-			-			-
	Total allowance for loan losses				$	1,034		$	1,191		$	1,277		$	1,358		$	1,408

Refer to Exhibit 10 for footnote explanations.

UnionBanCal Corporation and Subsidiaries
Net Interest Income (Unaudited)
Exhibit 7

			For the Three Months Ended
			March 31, 2011							March 31, 2010
(Dollars in millions)			Average Balance			Interest Income/ Expense ⁽¹⁾		Average Yield/ Rate ⁽¹⁾⁽²⁾		Average Balance			Interest Income/ Expense ⁽¹⁾		Average Yield/ Rate ⁽¹⁾⁽²⁾
Assets
Loans held for investment: ⁽⁹⁾
	Commercial, financial and industrial		$	15,325		$	157	4.13	%	$	14,955		$	162	4.39	%
	Construction			1,341			12	3.48			2,309			17	2.97
	Residential mortgage			17,794			220	4.94			16,785			228	5.42
	Commercial mortgage			7,778			85	4.38			8,234			86	4.20
	Consumer			3,823			40	4.29			3,916			43	4.43
	Lease financing			776			8	4.33			649			6	3.81
		Total loans, excluding FDIC covered loans		46,837			522	4.48			46,848			542	4.65
	FDIC covered loans			1,446			39	10.89			-			-	-
		Total loans held for investment		48,283			561	4.67			46,848			542	4.65
Securities				21,601			143	2.64			23,546			144	2.44
Interest bearing deposits in banks				1,200			1	0.25			6,597			4	0.25
Federal funds sold and securities purchased under resale agreements				96			-	0.18			461			-	0.10
Trading account assets				150			-	1.19			208			1	1.68
Other earning assets				21			-	3.49			-			-	-
		Total earning assets		71,351			705	3.97			77,660			691	3.57
Allowance for loan losses				(1,182	)						(1,407	)
Cash and due from banks				1,246							1,205
Premises and equipment, net				712							674
Other assets				7,929							6,678
		Total assets	$	80,056						$	84,810
Liabilities
Deposits:
	Transaction and money market accounts		$	25,489			15	0.25		$	39,861			63	0.64
	Savings and consumer time			7,857			14	0.71			5,972			12	0.81
	Large time			8,987			24	1.03			7,621			11	0.56
		Total interest bearing deposits		42,333			53	0.50			53,454			86	0.65
Commercial paper and other short-term borrowings ⁽¹⁰⁾				2,435			1	0.27			1,496			1	0.40
Long-term debt				5,902			31	2.16			4,574			27	2.35
		Total borrowed funds		8,337			32	1.61			6,070			28	1.87
		Total interest bearing liabilities		50,670			85	0.68			59,524			114	0.77
Noninterest bearing deposits				17,138							14,384
Other liabilities				1,815							1,276
		Total liabilities		69,623							75,184
Equity
UNBC Stockholder's equity				10,167							9,532
Noncontrolling interests				266							94
		Total equity		10,433							9,626
		Total liabilities and equity	$	80,056						$	84,810

Net interest income/spread (taxable-equivalent basis)							620	3.29	%					577	2.80	%
Impact of noninterest bearing deposits								0.17							0.15
Impact of other noninterest bearing sources								0.03							0.03
Net interest margin								3.49							2.98
Less: taxable-equivalent adjustment							2							3
		Net interest income				$	618						$	574


Refer to Exhibit 10 for footnote explanations.

UnionBanCal Corporation and Subsidiaries
Net Interest Income (Unaudited)
Exhibit 8

			For the Three Months Ended
			March 31, 2011							December 31, 2010
(Dollars in millions)			Average Balance			Interest Income/ Expense ⁽¹⁾		Average Yield/ Rate ⁽¹⁾⁽²⁾		Average Balance			Interest Income/ Expense ⁽¹⁾		Average Yield/ Rate ⁽¹⁾⁽²⁾
Assets
Loans held for investment: ⁽⁹⁾
	Commercial, financial and industrial		$	15,325		$	157	4.13	%	$	14,848		$	170	4.56	%
	Construction			1,341			12	3.48			1,724			18	4.13
	Residential mortgage			17,794			220	4.94			17,400			222	5.11
	Commercial mortgage			7,778			85	4.38			7,851			84	4.29
	Consumer			3,823			40	4.29			3,872			43	4.36
	Lease financing			776			8	4.33			641			5	2.89
		Total loans, excluding FDIC covered loans		46,837			522	4.48			46,336			542	4.66
	FDIC covered loans			1,446			39	10.89			1,616			37	9.03
		Total loans held for investment		48,283			561	4.67			47,952			579	4.81
Securities				21,601			143	2.64			21,560			137	2.54
Interest bearing deposits in banks				1,200			1	0.25			1,653			1	0.26
Federal funds sold and securities purchased under resale agreements				96			-	0.18			174			-	0.19
Trading account assets				150			-	1.19			178			-	1.10
Other earning assets				21			-	3.49			-			-	-
		Total earning assets		71,351			705	3.97			71,517			717	4.00
Allowance for loan losses				(1,182	)						(1,273	)
Cash and due from banks				1,246							1,271
Premises and equipment, net				712							682
Other assets				7,929							7,985
		Total assets	$	80,056						$	80,182
Liabilities
Deposits:
	Transaction and money market accounts		$	25,489			15	0.25		$	28,697			21	0.30
	Savings and consumer time			7,857			14	0.71			7,773			14	0.74
	Large time			8,987			24	1.03			8,777			21	0.93
		Total interest bearing deposits		42,333			53	0.50			45,247			56	0.50
Commercial paper and other short-term borrowings ⁽¹⁰⁾				2,435			1	0.27			1,246			-	0.30
Long-term debt				5,902			31	2.16			5,109			27	2.05
		Total borrowed funds		8,337			32	1.61			6,355			27	1.71
		Total interest bearing liabilities		50,670			85	0.68			51,602			83	0.65
Noninterest bearing deposits				17,138							16,481
Other liabilities				1,815							1,793
		Total liabilities		69,623							69,876
Equity
UNBC Stockholder's equity				10,167							10,034
Noncontrolling interests				266							272
		Total equity		10,433							10,306
		Total liabilities and equity	$	80,056						$	80,182

Net interest income/spread (taxable-equivalent basis)							620	3.29	%					634	3.35	%
Impact of noninterest bearing deposits								0.17							0.16
Impact of other noninterest bearing sources								0.03							0.02
Net interest margin								3.49							3.53
Less: taxable-equivalent adjustment							2							3
		Net interest income				$	618						$	631


Refer to Exhibit 10 for footnote explanations.

UnionBanCal Corporation and Subsidiaries
Reconciliation of Non-GAAP Measures (Unaudited)
Exhibit 9

	The following table presents a reconciliation between certain Generally Accepted Accounting Principles (GAAP) amounts and specific non-GAAP measures as used to compute selected non-GAAP financial ratios.

			As of and for the Three Months Ended																				For the Years Ended
	(Dollars in millions)		March 31, 2011				December 31, 2010				September 30, 2010				June 30, 2010				March 31, 2010				March 31, 2011				March 31, 2010

	Net income attributable to UNBC		$	235			$	172			$	170			$	154			$	77			$	235			$	77
	Net adjustments related to privatization transaction, net of tax			3				7				8				9				12				3				12
	Net income (loss) attributable to UNBC, excluding impact of privatization transaction		$	238			$	179			$	178			$	163			$	89			$	238			$	89

	Average total assets		$	80,056			$	80,182			$	82,265			$	85,511			$	84,810			$	80,055			$	84,810
	Net adjustments related to privatization transaction			2,473				2,488				2,509				2,529				2,547				2,473				2,547
	Average total assets, excluding impact of privatization transaction		$	77,583			$	77,694			$	79,756			$	82,982			$	82,263			$	77,582			$	82,263
	Return on average assets ⁽²⁾			1.19		%		0.85		%		0.82		%		0.72		%		0.37		%		1.19		%		0.37		%
	Return on average assets, excluding impact of privatization transaction ^{(2) (11)}			1.24				0.92				0.89				0.78				0.44				1.24				0.44

	Average UNBC stockholder's equity		$	10,167			$	10,034			$	9,913			$	9,631			$	9,532			$	10,167			$	9,532
	Net adjustments related to privatization transaction			2,396				2,401				2,405				2,409				2,412				2,396				2,412
	Average UNBC stockholder's equity, excluding impact of privatization transaction		$	7,771			$	7,633			$	7,508			$	7,222			$	7,120			$	7,772			$	7,120
	Return on average UNBC stockholder's equity ⁽²⁾			9.38		%		6.81		%		6.80		%		6.40		%		3.29		%		9.38		%		3.29		%
	Return on average UNBC stockholder's equity, excluding impact of privatization transaction ^{(2) (11)}			12.41				9.32				9.43				9.01				5.10				12.41				5.10

	Noninterest expense		$	615			$	701			$	562			$	584			$	525			$	614			$	525
	Less: Foreclosed asset expense			3				4				6				1				-				3				-
	Less: (Reversal of) provision for losses on off-balance sheet commitments			(13	)			(2	)			(8	)			1				(5	)			(13	)			(5	)
	Less: Low income housing credit investment amortization expense			13				19				13				14				14				13				14
	Less: Expenses of the consolidated VIEs			6				15				6				6				5				6				5
	Less: Merger costs related to acquisitions			13				9				11				13				-				13				-
	Less: Asset impairment charge			-				30				-				-				-				-				-
		Net noninterest expense before privatization adjustments (a)	$	593			$	626			$	534			$	549			$	511			$	592			$	511
	Net adjustments related to privatization transaction, net of tax			26				32				33				32				39				26				39
		Net noninterest expense, excluding impact of privatization transaction (b)	$	567			$	594			$	501			$	517			$	472			$	566			$	472

	Total revenue		$	858			$	882			$	836			$	845			$	784
	Add: Net interest income taxable-equivalent adjustment			2				3				2				2				3
	Total revenue, including taxable-equivalent adjustment (c)			860				885				838				847				787				-				784
	Accretion related to privatization-related fair value adjustments			21				21				18				19				19				21				19
	Total revenue, excluding impact of privatization transaction (d)		$	839			$	864			$	820			$	828			$	768			$	(21	)		$	765
	Core efficiency ratio (a)/(c) ⁽⁵⁾			68.80		%		70.88		%		63.69		%		64.86		%		64.98		%		68.80		%		64.98		%
	Core efficiency ratio, excluding impact of privatization transaction (b)/(d) ⁽¹¹⁾			67.47				68.83				61.13				62.39				61.51				67.47				61.51

	Total UNBC stockholder's equity		$	10,355			$	10,125			$	10,134			$	9,942			$	9,706
	Less: Goodwill			2,447				2,456				2,456				2,456				2,369
	Less: Intangible assets			432				457				487				517				529
	Less: Deferred tax liabilities related to goodwill and intangible assets			(159	)			(168	)			(180	)			(192	)			(203	)
	Tangible common equity (e)		$	7,635			$	7,380			$	7,371			$	7,161			$	7,011
	Tier 1 capital, determined in accordance with regulatory requirements ⁽⁷⁾		$	8,280			$	8,029			$	7,861			$	7,682			$	7,581
	Less: Trust preferred securities			-				13				13				13				13
	Tier 1 common equity (f)		$	8,280			$	8,016			$	7,848			$	7,669			$	7,568
	Total assets		$	80,642			$	79,097			$	79,840			$	84,310			$	85,471
	Less: Goodwill			2,447				2,456				2,456				2,456				2,369
	Less: Intangible assets			432				457				487				517				529
	Less: Deferred tax liabilities related to goodwill and intangible assets			(159	)			(168	)			(180	)			(159	)			(169	)
	Tangible assets (g)		$	77,922			$	76,352			$	77,077			$	81,496			$	82,742
	Risk-weighted assets, determined in accordance with regulatory requirements (h) ⁽⁷⁾		$	64,469			$	64,532			$	64,080			$	64,301			$	63,294
	Tangible common equity ratio (e)/(g) ⁽⁵⁾			9.80		%		9.67		%		9.56		%		8.79		%		8.47		%
	Tier 1 common capital ratio (f)/(h) ⁽⁷⁾			12.84				12.42				12.25				11.93				11.96

Refer to Exhibit 10 for footnote explanations.

UnionBanCal Corporation and Subsidiaries

Footnotes
Exhibit 10


⁽¹⁾		Yields and interest income are presented on a taxable-equivalent basis using the federal statutory tax rate of 35 percent.
⁽²⁾		Annualized.
⁽³⁾		Core deposits consist of total deposits, excluding brokered deposits and time deposits of $100,000 and over.
⁽⁴⁾		The core efficiency ratio, a non-GAAP financial measure, is net noninterest expense (noninterest expense excluding foreclosed asset expense, the (reversal of) provision for losses on off-balance sheet commitments, low income housing credit investment amortization expense, expenses of the consolidated VIEs and merger costs related to the acquisitions of certain assets and assumption of certain liabilities of Frontier Bank and Tamalpais Bank) as a percentage of total revenue (net interest income (taxable-equivalent basis) and noninterest income). Management discloses the core efficiency ratio as a measure of the efficiency of our operations, focusing on those costs most relevant to our core activities. Please refer to Exhibit 9 for a reconciliation between certain GAAP amounts and these non-GAAP measures.
⁽⁵⁾		The tangible common equity ratio, a non-GAAP financial measure, is calculated as tangible equity divided by tangible assets. The methodology of determining tangible common equity may differ among companies. The tangible common equity ratio has been included to facilitate the understanding of the Company's capital structure and for use in assessing and comparing the quality and composition of UnionBanCal's capital structure to other financial institutions. Please refer to Exhibit 9 for a reconciliation between certain GAAP amounts and these non-GAAP measures.
⁽⁶⁾		The Tier 1 common capital ratio is the ratio of Tier 1 capital, less qualifying trust preferred securities, to risk weighted assets. The Tier 1 common capital ratio, a non-GAAP financial measure, has been included to facilitate the understanding of the Company's capital structure and for use in assessing and comparing the quality and composition of UnionBanCal's capital structure to other financial institutions. Please refer to Exhibit 9 for a reconciliation between certain GAAP amounts and these non-GAAP measures. All of the trust preferred securities were paid off during the quarter ended March 31, 2011.
⁽⁷⁾		Estimated as of March 31, 2011.
⁽⁸⁾		The allowance for credit losses ratios include the allowances for loan losses and losses on off-balance sheet commitments.
⁽⁹⁾		Average balances on loans outstanding include all nonperforming loans. The amortized portion of net loan origination fees (costs) is included in interest income on loans, representing an adjustment to the yield.
⁽¹⁰⁾		Includes interest bearing trading liabilities.
⁽¹¹⁾		These ratios exclude the impact of the privatization transaction. Management believes that these ratios, which exclude the push-down accounting effects of the privatization transaction, provide useful supplemental information, which is important to a proper understanding of the Company's core business results. Please refer to Exhibit 9 for a reconciliation between certain GAAP amounts and these non-GAAP measures.
⁽¹²⁾		These ratios exclude the impact of the FDIC covered loans, the related allowance for loan losses and FDIC covered OREO, which are covered under loss share agreements between Union Bank, N.A. and the Federal Deposit Insurance Corporation. Such agreements are related to the April 2010 acquisitions of certain assets and assumption of certain liabilities of Frontier Bank and Tamalpais Bank. Management believes the exclusion of FDIC covered loans and FDIC covered OREO in certain asset quality ratios that include nonperforming loans, nonperforming assets, total loans held for investments and the allowance for loan losses or credit losses in the numerator or denominator provides a better perspective into underlying asset quality trends and comparability to the periods presented that were not impacted by the April 2010 acquisitions.
⁽¹³⁾		Excludes loans totaling $279 million, $312 million, $297 million and $255 million that are 90 days or more past due and still accruing at March 31, 2011, December 31, 2010, September 30, 2010 and June 30, 2010, respectively, which consisted of FDIC covered loans accounted in accordance with the accounting standards for purchased credit impaired loans.
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CONTACT:
UnionBanCal Corporation
Jane Yedinak, 415-765-3241
Corporate Communications
Michelle Crandall, 415-765-2780
Investor Relations

MUFG Americas Holdings Corp - FORM 8-K - EX-99.1 - EXHIBIT 99.1 - April 28, 2011

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MUFG Americas Holdings Corp Reports