UnionBanCal Profit Beats Expectations

UnionBanCal Corp. reported 11.5% higher earnings, beating Wall Street expectations on higher income from fees and dwindling loan losses.

The San Francisco-based parent of Union Bank of California said second-quarter profit rose to $144.8 million, or 96 cents a share, from $129.9 million, or 81 cents, in the period a year ago. Analysts had expected 90 cents. The results were released after the market closed.

Falling interest rates kept lending income flat at $386.4 million, but fee income was $194.2 million, up $18.6 million. No-interest deposits rose by $3 billion, said UnionBanCal President Norimichi Kanari, and loan-loss provisions were $25 million, down from $50 million.

The bank raised its dividend by 10.7% to 31 cents during the quarter.

-- E. Scott Reckard