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| ## Comptroller of the Currency                                        |
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| > Administrator of National Banks                                     |
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Washington, DC 20219

#### Interpretive Letter #1048a

February 27, 2006 **March 2006**

#### 12 USC 29

John H. McGuckin, Jr.

Executive Vice President,

General Counsel, and Secretary

Union Bank of California, N.A.

400 California Street, 16^th^ Floor

San Francisco, California 94104

> Subject: Interpretive Letter No. 1048 ("IL 1048")

Dear Mr. McGuckin:

In light of questions that have been raised regarding the details,
limits, and scope of the financing transaction addressed in IL 1048, and
because our previous communications were with outside counsel to the
bank, we are writing directly to you to make sure that there is a clear
understanding of the restrictions and limitations associated with the
financing transaction. Our legal opinion was premised upon the following
characteristics of the financing and the bank's role in the financing
transaction as represented to us:

-   Before advancing funds, the bank would determine creditworthiness of
    project.

-   The creditworthiness review and determination would be made pursuant
    to the bank's standard loan underwriting criteria.

-   Structuring the financing as a membership investment would be
    essential to the availability of tax credits to the bank and thereby
    integral to material terms of the financing provided by the bank.

-   The project's agreement would contain many of the same terms,
    conditions, and covenants typically found in lending and lease
    financing transactions to protect the bank's interests.

-   The bank would not participate in operation of the wind energy
    company, production of the wind energy, nor the sale of the wind
    energy.

-   The bank would acquire approximately 70% of the equity interest in
    the company, and would look to distributions of revenue from the
    sale of electricity and the receipt of tax credits and depreciation
    expense for repayment of the funds advanced and its return on those
    funds.

-   The bank would not share in any appreciation in value of its
    interest in the wind energy company or any of the company's real
    property or personal property assets.

-   In the event the energy company does not perform as projected (which
    would enable the bank to obtain repayment of the funds advanced,
    plus a calculated return), the bank may sell its interest in the
    wind energy company to minimize or avoid loss on the financing.

-   Alternatively, in the event the energy company does not perform as
    projected, the bank would have the ability to force a vote to
    liquidate the wind energy company to minimize or avoid loss on the
    financing.

-   At the end of the ten-year holding period, the bank would sell at
    book value its ownership interest in the wind energy company. It is
    projected that this value would be a small percentage of the bank's
    original investment.

We wanted to restate these characteristics so that it is clear that
there is no misunderstanding on the bases for our conclusion. As IL 1048
states, our conclusion was based on the information and representations
provided to us. A material change could result in a different
conclusion.

Sincerely,

signed

Julie L. Williams

First Senior Deputy Comptroller

and Chief Counsel