Dow Jones Newswires

SAN FRANCISCO -- Unionbancal Corp. lowered its second quarter earnings projection, saying it expects to post second quarter operating earnings of 77 cents to 82 cents per diluted share, including a provision for credit losses of about $70 million.

A First Call/Thomson Financial survey of 13 analysts produced a mean second quarter earnings estimate of 88 cents a share.

Unionbancal said it reported operating earnings of 69 cents a share for the year-ago quarter, including a provision for credit losses of $10 million.

The company said it has experienced a "decline in asset quality" and has taken "appropriate action."

Despite lowering its projection, Unionbancal expects to post double-digit second quarter operating earnings growth.

New York Stock Exchange-traded shares of Unionbancal closed at $29.6875, down $1.8125, or 5.94%.

Unionbancal estimated non-performing loans as of June 30 to be about $200 million, compared with $144 million at March 31 and $167 million at Dec. 31, 1999.

The $33.6 billion-asset bank holding company also estimated net charge-offs for the second quarter at $52 million, compared with $27 million in the first quarter.

Unionbancal, which is 64% owned by The Bank of Tokyo-Mitsubishi Ltd., has 240 branches in California, six in Oregon and Washington, and 18 outside the United States.

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