UnionBanCal Corporation Announces Settlement With State of California Franchise Tax Board
December 08 2006 - 4:30PM
Business Wire
UnionBanCal Corporation (NYSE:UB) announced that on December 4,
2006, its primary subsidiary, Union Bank of California (UBOC), was
advised that the State of California Franchise Tax Board (FTB)
approved a settlement between UBOC and the State of California to
recover taxes paid for the calendar years 1989 through 1995. UBOC
will receive a refund of tax and interest of approximately $113.7
million (approximately $72.6 million net of the effect of federal
and state taxes applicable to the refund). The settlement was made
in response to claims for refund filed by UBOC in 2001 with respect
to the proper tax treatment of losses from loans and securities
during 1989 through 1995. The losses were incurred by the group of
affiliated corporations included in UBOC�s California tax filing.
After an initial denial of the claims by the FTB Audit Division,
UBOC filed a suit for refund in San Francisco Superior Court. The
settlement agreement settles all claims for the years at issue and
the lawsuit will be dismissed. The refund will be included in net
income in the fourth quarter of 2006. Based in San Francisco,
UnionBanCal Corporation is a bank holding company with assets of
$52 billion at September 30, 2006. Its primary subsidiary, Union
Bank of California, N.A., had 320 banking offices in California,
Oregon and Washington, and 2 international offices at September 30,
2006.
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