Unionbancal Corp. said Monday it would cut 1,400 employees, or 15% of its work force, as part of an efficiency drive.

The job eliminations are part of a four-month restructuring campaign, which is expected to add $225 million annually to pretax earnings and result in an $85 million pretax restructuring charge this quarter, the company said.

The $32.4 billion-asset Unionbancal, which is Japanese-owned and the parent of San Francisco-based Union Bank of California, embarked on its "Mission Excel" in March.

The initial push came after Union Bank leadership convinced Bank of Tokyo-Mitsubishi, which controls 64% of its shares, that it would benefit from a secondary stock offering. Before the offering, which took place in February, Unionbancal had to lay plans to improve its efficiency ratio, which was hovering around 62%, said vice chairman and commercial banking chief Robert Walker.

"We made it clear to the principal shareholder that we couldn't go to the marketplace and institutional investors with an efficiency ratio north of 60%," Mr. Walker said.

The job cuts began Monday andrun through early September, according to vice chairman and retail chief Richard C. Hartnack. Every effort will be made to help affected employees find new jobs within Unionbancal, he said. If that does not work, they will be given outplacement assistance.

Some of the restructuring efforts probably should have been made immediately following the 1996 merger of Union Bank and Bank of California, said Mr. Walker. "When you look at in-market consolidation, you see certain trends that we didn't see at our bank, and that disturbed us," he said.

For example, Union Bank had been offering high-net-worth services through four separate units. They will now be brought together under common management and a single private banking brand name.

Union Bank is also changing how it handles small-business customers. The Mission Excel process revealed that resources were being squandered because small businesses and lower-end middle market clients were being served by two divisions.

"We thought we had split it at $20 million in annual sales, but we found there was some overlap," Mr. Hartnack said. "It resulted in less attention to small clients and an overabundance of resources devoted to bigger clients."

Under the new structure, Mr. Hartnack will oversee lending to businesses with up to $5 million of annual sales or less, and Mr. Walker will be in charge of firms with sales above that level.

The $225 million of anticipated earnings improvement would come from $90 million of additional revenue and $135 million of reduced expenses. About half of the $225 million would surface by the first half of 2000, Mr. Walker said. As much as 90% of the additional earnings will have been recognized by the end of 2000, he added.

The $85 million restructuring charge to be taken in the third quarter is comprised of $70 million of personnel charges - mostly stemming from severance packages -- and $15 million for facilities charges, such as writedowns of office space that will no longer be needed.

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