UnionBanCal Corp., San Francisco, has announced that it expects to make a $60 million provision for credit losses for the fourth quarter, a $45 million increase from its October forecast stemming chiefly from loans to homebuilders. The company held approximately $850 million in homebuilder loans as of Dec. 31, about 2% of its loan portfolio, said Philip Flynn, vice chairman and chief operating officer of UnionBanCal. "We believe that our homebuilder exposure is less than peer banks, on average, and that our homebuilder customers collectively are financially stronger than average," Mr. Flynn said. "Still, given the poor fundamental conditions in the homebuilding industry today, and the weak outlook for the industry, we concluded that it was appropriate to increase reserves for probable future loan losses."

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