EXHIBIT 10.13

                              EMPLOYMENT AGREEMENT


         THIS AGREEMENT, effective as of January 1, 1998, is entered into by and
between Union Bank of California, N.A., a National Banking Association (the
"Bank"), and David I. Matson ("Mr. Matson"), an individual.

         WHEREAS, Mr. Matson is currently employed by the Bank as Executive Vice
President and Chief Financial Officer ("CFO");

         WHEREAS, Mr. Matson has been designated a policy making officer of the
Bank and UnionBanCal Corporation ("UNBC");

         WHEREAS, the parties wish to terminate and supersede the existing terms
and conditions of Mr. Matson's employment with the Bank; and

         WHEREAS, the Bank desires to continue to secure the services of Mr.
Matson and Mr. Matson desires to perform services for the Bank on the terms and
conditions set forth in this Agreement;

         NOW THEREFORE, in consideration of the foregoing and of the material
promises and conditions contained in this Agreement, the parties agree as
follows:

         1.       REPRESENTATIONS AND WARRANTIES.

         The Bank represents that it is fully authorized to enter into this
Agreement. Mr. Matson warrants that he is under no employment contract, bond,
confidentiality agreement, or any other obligation which would violate or be in
conflict with the terms and conditions of this Agreement or encumber his
performance of duties assigned to him by the Bank. Mr. Matson further warrants
that he has not signed or committed to any employment or consultant duties or
other obligations which would divert his attention from the duties assigned to
him by the Bank under this Agreement. The parties do not intend to include
within the meaning of this paragraph Mr. Matson's service at the request of the
Bank's Deputy Chairman, Credit and Administration ("Deputy Chairman"), or with
the concurrence of the Deputy Chairman and/or the Bank's Chief Executive
Officer, for nonprofit, charitable, or trade associations or on the boards of
directors or other governing bodies of business enterprises unrelated to the
Bank and not in a business competitive with a business of the Bank.

         2.       EMPLOYMENT AND DUTIES.

         The Bank will continue to employ Mr. Matson as its CFO. Mr. Matson
hereby accepts such employment with the Bank. Mr. Matson shall devote his time,
ability, attention, energy, knowledge and skill solely and exclusively to
performing all reasonable duties as CFO of the Bank as assigned to him by the
Bank's Deputy Chairman and/or Chief Executive Officer.

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         3.       BASE SALARY.

         In consideration for Mr. Matson's services to the Bank during the time
period in which this Agreement is effective, Mr. Matson is receiving a base
salary of Two Hundred Twenty-Five Thousand Dollars ($225,000.00) per annum to be
paid in equal installments as per the Bank's salary administration program every
two (2) weeks, and subject to annual review and increases at the discretion of
the Executive Compensation and Benefits Committee of the Board, the Board or any
other committee constituted by the Board for this purpose (as applicable, the
"Committee"). Annual base salary shall be competitive with the annual base
salaries for comparable executive positions at banks of similar size and focus,
as determined at the discretion of the Committee.

         4.       ADDITIONAL BENEFITS.

         During his employment under this Agreement:

                  a.    BONUS. Mr. Matson shall be entitled to participate in
         the Bank's Senior Management Bonus Plan or its successor, subject to
         the eligibility requirements and other terms and conditions of such
         Plan and the determinations of the administrator of such Plan. Mr.
         Matson's target bonus under the Senior Management Bonus Plan shall be
         thirty-five percent (35%) of base salary, subject to annual review and
         increases or decreases at the discretion of the Committee, based on the
         median annual bonus targets for comparable executive positions at banks
         of similar size and focus (as determined at the discretion of the
         Committee).

                  b.    LONG TERM INCENTIVES. Mr. Matson shall be eligible for
         long term incentive awards available to policy making officers. Awards
         may consist of one or more types of long term incentives, including the
         grant of stock options and restricted stock under the UNBC Management
         Stock Plan or its successor and the award of performance shares under
         the UNBC Performance Share Plan or its successor. Mr. Matson's target
         award shall be valued at fifty percent (50%) of base salary.
         Notwithstanding the preceding sentence, determinations of the amount of
         any award to Mr. Matson shall be made at the discretion of the
         Committee, subject to annual review and increases or decreases, based
         on the median long term incentive targets for comparable executive
         positions at banks of similar size and focus (as determined at the
         discretion of the Committee).

                  c.    RETIREMENT AND 401(K) PLAN.  Mr. Matson shall be
         entitled to participate in the Bank retirement and 401(k) plans that
         are now or hereafter will be in effect, subject to the eligibility
         requirements and other terms and conditions of such plans and the
         determinations of the administrator of such plans.

                  d.    SUPPLEMENTAL RETIREMENT BENEFITS. During his employment
         under this Agreement Mr. Matson shall be a participant under the Bank's
         Supplemental Executive Retirement Plan (the "SERP") and under the Union
         Bank Executive Supplemental Benefit Plan; the latter of which is a plan
         of a predecessor of the Bank and copies of each

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         plan are attached hereto as Exhibit D. The supplemental plans referred
         to in the preceding sentence, together with the Bank's retirement plans
         now or hereafter in effect, shall collectively be referred to
         hereinafter as the "Retirement Plans."

                  e.    INSURANCE AND WELFARE PLANS.  Mr. Matson and his
         eligible dependents shall be eligible to receive such other benefits or
         rights as may be provided under any employee benefit plan provided by
         the Bank that is now or hereafter will be in effect (including
         participation in life, medical, disability, dental and vision insurance
         plans), subject to eligibility requirements and other terms and
         conditions of such plans and the determinations of administrators of
         such plans.

                  f.    OTHER BENEFITS.  The Bank shall provide other benefits
         such as a car allowance, luncheon and country club expenses, and other
         perquisites as determined by the Committee for similarly situated
         executives.

                  g.    BUSINESS EXPENSES.  Mr. Matson shall be entitled to
         reimbursement by the Bank for such customary, ordinary and necessary
         business expenses as are incurred by him in the performance of his
         duties and activities associated with promoting or maintaining the
         business of the Bank. All expenses as described in this subparagraph
         4(g) will be reimbursed only upon presentation by Mr. Matson of such
         documentation in accordance with Bank policy and as may be reasonably
         necessary to substantiate that all such expenses were incurred in
         performance of his duties.

                  h.    VACATION AND SICK LEAVE.  Mr. Matson shall be entitled
         to earn (i) four (4) weeks' paid vacation each year of employment under
         this Agreement and (ii) sick leave on the same basis as other Bank
         employees and subject to all accrual or accumulated maximum entitlement
         limitations which currently or may hereafter exist under the Bank's
         vacation and sick leave policies.

                  i.    RELOCATION EXPENSES.  If, during the term of this
         Agreement and with the concurrence of the Bank, Mr. Matson relocates
         his principal residence from the Los Angeles area to the San Francisco
         area, Mr. Matson shall be entitled to:

                        (i) a monthly housing cost differential payment of One
                  Thousand Five Hundred Dollars ($1,500.00), commencing upon
                  such relocation and continuing until the earlier of Mr.
                  Matson's 60th birthday or the termination of his employment
                  with the Bank; and

                        (ii) reimbursement, up to a maximum of seven and
                  one-half percent (7-1/2%) of the sale price, for actual
                  non-recurring, non-negotiated costs incurred in the sale of
                  Mr. Matson's principal residence, including licensed real
                  estate agent fees at the prevailing rate for the area, closing
                  costs that are typical for the area, mortgage prepayment
                  penalties (if any), and termite inspections; and

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                        (iii) reimbursement, up to a maximum of three percent
                  (3%) of the purchase price, for actual non-recurring,
                  non-negotiated costs incurred in the purchase of Mr. Matson's
                  new principal residence, including closing costs that are
                  typical for the area (and excluding origination fees and loan
                  points); and

                        (iv) reimbursement for other reasonable expenses in
                  connection with Mr. Matson's relocation from the Los Angeles
                  area to the San Francisco area, in accordance with Bank policy
                  for similarly situated executives.

         5.       OUTSIDE ACTIVITIES AND NON-COMPETITION.

         During the term of this Agreement, and subject to paragraph 1, Mr.
Matson shall devote his time, ability, attention, energy, knowledge and skill to
the business of the Bank. During the term of this Agreement, Mr. Matson shall
not, directly or indirectly, either as an employee, employer, consultant, agent,
principal, partner, shareholder, corporate officer, director, or in any other
capacity, engage or assist any third party in engaging in any business
competitive with the business of the Bank, UNBC or their subsidiaries, without
the written approval of the Bank's Chief Executive Officer. Investments in
publicly traded corporations through brokerage accounts or in mutual funds, or
depositor/borrower relationships with other financial institutions are not
intended to be covered by this paragraph. Following his employment with the
Bank, Mr. Matson shall not engage in unfair competition with the Bank or aid
others in any unfair competition with the Bank, unfair competition having the
meaning ascribed in the "Competition and Business Promotion" section of the
Bank's April 1996 revision of the Business Standards of Conduct (except that the
object of the prohibition shall be read as the Bank rather than a competitor).
Following his employment with the Bank, Mr. Matson shall not in any way breach
the confidence that the Bank has placed in him or misappropriate any proprietary
information of the Bank, as such prohibitions are described in the Bank's April
1996 revision of the Business Standards of Conduct.

         6.       TERMINATION OF EMPLOYMENT.

         This Agreement shall terminate as follows:

                  a.    BY DEATH. This Agreement shall be terminated upon the
         death of Mr. Matson. The Bank's total liability to Mr. Matson in the
         event of termination of Mr. Matson's employment under this subparagraph
         shall be limited to the payment (on his behalf) of Mr. Matson's salary
         and benefits as set forth in paragraphs 3 and 4 of this Agreement
         through the effective date of termination, except that if Mr. Matson
         has not attained age 60 at the time of his death, his spouse shall
         receive pre-retirement death benefits under the Retirement Plans as if
         Mr. Matson had continued to work for the Bank for an additional period
         of time such that he would have reached age 60 at the time of death.

                  b.    BY DISABILITY. If, in the sole opinion of the Bank's
         Chief Executive Officer, governed by the exercise of good faith and
         supported by competent medical

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         opinion, Mr. Matson is prevented from properly performing his duties
         hereunder by reason of any physical or mental incapacity, for a period
         of more than ninety (90) days in the aggregate in any twelve (12) month
         period, then, to the extent permitted by law, his employment with the
         Bank shall terminate. The Bank's total liability to Mr. Matson in the
         event of termination of Mr. Matson's employment under this subparagraph
         shall be limited to (i) the payment of Mr. Matson's salary and benefits
         as set forth in paragraphs 3 and 4 of this Agreement through the
         effective date of termination, except that if Mr. Matson has not
         attained age 60 at the time of his disability, he also shall receive
         retirement benefits under the Retirement Plans equal to the additional
         amounts he would have earned if he continued to work for the Bank for
         an additional period of time such that he would have reached age 60 at
         the time of disability. Nothing in this paragraph 6 is intended to
         preclude Mr. Matson from exercising any rights he may have under the
         Bank's Short Term Disability Plan or Long Term Disability Plan, in
         accordance with the eligibility requirements and other terms and
         conditions of those respective plans, or their respective successors.

                  c.    FOR CAUSE. The Bank reserves the right to terminate this
         Agreement immediately, at any time, if, in the opinion of the Bank's
         Chief Executive Officer: Mr. Matson materially and/or habitually
         breaches or neglects the duties which he is required to perform under
         the terms of this Agreement; commits any material act of dishonesty,
         fraud, misrepresentation, or other material act which would violate the
         Bank's Business Standards of Conduct; is guilty of gross carelessness
         or misconduct; fails to obey the lawful direction of the Bank's Chief
         Executive Officer or the Board; or acts in any way that has a direct,
         substantial and adverse effect on the Bank's reputation. Nothing in the
         phrase "acts in any way that has a direct, substantial and adverse
         effect on the Bank's reputation" as used in the preceding sentence is
         intended to include legally required or other reporting or disclosure
         by Mr. Matson of financial information regarding the Bank in the
         ordinary course of his employment as CFO. The Bank's total liability to
         Mr. Matson in the event of termination of Mr. Matson's employment under
         this subparagraph shall be limited to the payment of Mr. Matson's
         salary and benefits as set forth in paragraphs 3 and 4 of this
         Agreement through the effective date of termination.

                  d.    WITHOUT CAUSE. The Bank reserves the right to terminate
         this Agreement without cause, for any reason and at any time, by
         written notice to Mr. Matson from the Bank's Chief Executive Officer.
         Mr. Matson hereby agrees that the Bank may dismiss him under this
         subparagraph 6(d) without regard to (i) any general or specific
         policies (whether written or oral) of the Bank relating to the
         employment or termination of its employees, or (ii) any statements made
         to Mr. Matson, whether made orally or contained in any document,
         pertaining to Mr. Matson's relationship with the Bank. In the event of
         termination under this subparagraph 6(d), and subject to the conditions
         set forth herein, Mr. Matson shall be entitled to receive the payments
         described in (i) and (ii) below.

                        (i) If Mr. Matson has not yet attained age 65 at the
                  time of his termination of employment, and provided Mr. Matson
                  has, at the time of his termination of employment, previously
                  executed the "General and Special

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                  Release" (attached hereto as Exhibit A), then in consideration
                  for such Release, the Bank will provide Mr. Matson with:

                              (A) The greater of (I) two years of separation pay
                        payable as salary continuation on a payroll by payroll
                        basis, in an amount equal to Mr. Matson's base salary at
                        the time of his termination, plus a prorated bonus
                        amount each payroll period equal to the average of Mr.
                        Matson's annual bonus (excluding any amount that
                        represents an award of long term incentive by the Bank)
                        for the three (3) most recent bonus determination years
                        divided by the number of payroll periods in the year, or
                        (II) the salary continuation amount payable under the
                        Bank's then existing separation pay plan; and

                              (B) Benefits (other than salary continuation)
                        available and/or payable to participants at or above the
                        level of Executive Vice Presidents for the salary
                        continuation period under the Bank's Separation Pay Plan
                        in effect on the date of this Agreement, or, if better,
                        under the Bank's separation pay plan in effect at the
                        time of his termination of employment. A true and
                        correct copy of the Plan as in effect on the date of
                        this Agreement is attached hereto as Exhibit B; and

                              (C) In the event that Mr. Matson has not attained
                        age 60 at the time of termination, he also shall receive
                        retirement benefits under the Union Bank of California
                        Retirement Plan and the Union Bank of California
                        Executive Supplemental Retirement Plan equal to the
                        additional amounts he would have earned if he continued
                        to work for the Bank for an additional period of time
                        such that he would have reached age 60 at the time of
                        termination; and

                              (D) In the event Mr. Matson's employment is
                        terminated pursuant to subparagraph 6(d) within
                        twenty-four (24) months of Mr. Matson's relocation of
                        his personal residence from the Los Angeles area to the
                        San Francisco area, reimbursement for usual and
                        customary expenses in connection with Mr. Matson's
                        relocation from the San Francisco area to the Los
                        Angeles area, in accordance with Bank policy for
                        similarly situated executives; and

                              (E) Full and immediate vesting, upon Mr. Matson's
                        termination of employment, in the target award amount
                        under his outstanding grant(s) of performance shares
                        under the UNBC Performance Share Plan, and payment of
                        such vested shares within 120 days following his
                        termination of employment (without giving effect to any
                        deferral election that would have applied had the shares
                        become an earned award), such payment to be made in cash
                        equal to the number of shares times the average
                        month-end closing price of UNBC common stock (as
                        published in the Western

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                        Edition of the Wall Street Journal) for the six months
                        immediately preceding Mr. Matson's date of termination
                        of employment; and

                        (ii) The Bank will provide Mr. Matson with salary and
                  benefits as set forth in paragraphs 3 and 4 of this Agreement
                  through the effective date of termination.

                  A termination of this Agreement on account of Mr. Matson's
         disability shall be governed by subparagraph 6(b) and not this
         subparagraph 6(d). In addition, in the event Mr. Matson dies while
         receiving salary continuation benefits under subparagraph 6(d)(i)(A)
         above, then Mr. Matson shall have the remaining salary continuation, if
         any, paid to his Designated Beneficiary under Exhibit C attached
         hereto.

                  e.    BY MR. MATSON WITHOUT CAUSE.  Mr. Matson reserves the
         right to terminate this Agreement for any reason (other than the reason
         set forth in subparagraph 6(f)) upon reasonable written notice to the
         Bank. The Bank's total liability to Mr. Matson in the event of
         termination of Mr. Matson's employment under this subparagraph shall be
         limited to the payment of Mr. Matson's salary and benefits as set forth
         in paragraphs 3 and 4 of this Agreement through the effective date of
         termination.

                  f.    BY MR. MATSON FOR CAUSE. Subject to the further
         conditions next described, Mr. Matson may terminate this Agreement by
         giving sixty (60) days' written notice to the Bank if he has incurred a
         material reduction of his duties, title or responsibility (including
         Mr. Matson no longer serving in the capacity or under the title of
         Executive Vice President and/or Chief Financial Officer), a reduction
         in his annual base salary or a reduction in his overall compensation
         package below the median package for comparable executive positions at
         banks of similar size and focus (this peer group to be determined at
         the discretion of the Committee). In order to elect to terminate this
         Agreement pursuant to this subparagraph 6(f), Mr. Matson must submit
         the written notice to the Bank within sixty (60) days of the reduction.
         Mr. Matson shall not be entitled to elect to terminate this Agreement
         pursuant to this subparagraph 6(f) if prior to Mr. Matson's termination
         date the Bank corrects the deficiency upon which Mr. Matson's
         resignation is based. In the event that Mr. Matson is entitled to and
         elects to terminate this Agreement pursuant to this subparagraph 6(f),
         (i) he shall be entitled to receive salary and benefits as set forth in
         paragraphs 3 and 4 of this Agreement through the effective date of
         termination, and (ii) if he has not yet attained age 65 at the time of
         his termination of employment and further has, at the time of his
         termination of employment, previously executed the "General and Special
         Release" (attached hereto as Exhibit A), then in consideration for such
         Release, the Bank will provide Mr. Matson with the salary continuation
         and benefits set forth in subparagraphs 6(d)(i)(A), (B), (C), (D) and
         (E). In the event Mr. Matson dies while receiving salary continuation
         benefits described in subparagraph 6(d)(i)(A) above, then Mr. Matson
         shall have the remaining salary continuation, if any, paid to his
         Designated Beneficiary under Exhibit C attached hereto.

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                  g.    RESIGNATION OF POSITIONS.  Upon termination of
         employment for any reason whatsoever, Mr. Matson shall be deemed to
         have resigned from all offices and positions with the Bank, UNBC, and
         their subsidiaries. Mr. Matson agrees that, in connection with his
         termination under this Agreement, he will sign such written
         resignations as required by the Bank.

         7.       PROHIBITION OF ASSIGNMENT.

         This Agreement is personal to Mr. Matson and he may not assign or
delegate any of his rights or obligations hereunder without first obtaining the
written consent of the Bank.

         8.       UNBC OR BANK SUCCESSOR.

         For all purposes under this Agreement, the term "UNBC" shall include
any successor to UNBC's business and/or assets, by purchase, merger,
consolidation, reorganization, liquidation or otherwise. For all purposes under
this Agreement, the term "Bank" shall include any successor to the Bank's
business and/or assets, by purchase, merger, consolidation, reorganization,
liquidation or otherwise, and, in such an event, for all purposes under this
Agreement, the term "UNBC" also shall mean the U.S. parent company to such
successor (and, if there is no such U.S. parent company, the successor itself).
This Agreement shall inure to the benefit of and be binding upon any such
successor to UNBC and the Bank to which Mr. Matson's employment is transferred.

         9.       ARBITRATION.

         Any controversy between the Bank, UNBC or their parent companies,
subsidiaries and affiliates and Mr. Matson or between any employee of the Bank,
UNBC or their parent companies, subsidiaries and affiliates and Mr. Matson,
including, but not limited to, any controversy arising out of Mr. Matson's
employment or the termination thereof, involving the construction or application
of any of the terms, provisions or conditions of this Agreement, or otherwise
arising out of or relating to this Agreement and any controversy arising out of
or relating to Exhibit A to this Agreement (the "General and Special Release")
or involving a claim of race, sex, religious, age, disability, veteran status,
sexual orientation or national origin discrimination, shall be settled by
arbitration in accordance with the then current employment dispute resolution
rules of the American Arbitration Association determined by the Committee to
most closely resemble the California Employment Dispute Resolution Rules in
effect on January 1, 1998, and judgment on the award rendered by the
arbitrator(s) may be entered by any court having jurisdiction thereof.
Reasonable limited discovery will be permitted in the form of the right of each
party to take the deposition of one individual and any expert witness designated
by the other party. Each party shall also have the right to make requests for
discovery of relevant documents to the other party. Additional discovery may be
had only where the arbitrator so orders, upon a showing of substantial need. The
Bank and Mr. Matson each shall bear their own costs and legal fees associated
with the arbitration, except that the arbitrator shall have the right in his
discretion to award reasonable legal fees to the prevailing party in the
arbitration. Further, the Bank shall bear the cost of the arbitrator (including
the costs of establishing a facility for and

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otherwise administering the arbitration). The location of the arbitration shall
be in San Francisco, California, and the arbitration shall be conducted so as to
result in the rendering of the arbitrator's decision within ninety (90) days
after the original demand for arbitration.

         In the event of a breach by Mr. Matson of any of the covenants
contained in paragraph 5 of this Agreement, it is recognized that in addition to
any other remedy available to it, the Bank shall be entitled to institute or
prosecute proceedings in any court of competent jurisdiction, either in law or
in equity, to obtain damages for any breach of this Agreement or to sue for
specific performance, or an injunction against performance of any acts, or to
seek any other available remedy.

         This paragraph 9 of this Agreement and the obligations provided for
herein shall survive the termination of this Agreement and remain in full force
and effect following the termination of Mr. Matson's employment with the Bank.

         10.      LIMITATION ON PAYMENTS.

                  a.    BASIC RULE. In the event Mr. Matson becomes entitled to
         payments under this Agreement in connection with his termination of
         employment at a time when the Bank's Auditors determine that the
         payments result in "excess parachute payments" under section 280G of
         the Internal Revenue Code (the "Code"), then instead of the amounts
         payable under this Agreement, Mr. Matson shall receive aggregate
         payments equal to the Reduced Amount, if such Reduced Amount would
         result in net after-tax payments to Mr. Matson that are greater than
         the net after-tax payments he would have received without regard to
         this paragraph. For purposes of this paragraph 10, the "Reduced Amount"
         shall be the amount, expressed as a present value, that maximizes the
         aggregate present value of the payments without causing any payment to
         be nondeductible by the Bank under section 280G of the Code. All
         calculations required by this paragraph 10 shall be performed by the
         Bank's independent auditors retained most recently prior to the
         transaction implicating section 280G of the Code (the "Auditors"),
         based on information supplied by the Bank and Mr. Matson, and shall be
         binding on the Bank and Mr. Matson. All fees and expenses of the
         Auditors shall be paid by the Bank.

                  b.    REDUCTIONS. If the amount of the aggregate payments to
         Mr. Matson must be reduced under this paragraph 10, then Mr. Matson
         shall direct in which order the payments are to be reduced, but no
         change in the timing of any payment shall be made without the Bank's
         consent. As a result of uncertainty in the application of sections 280G
         and 4999 of the Code at the time of an initial determination by the
         Auditors hereunder, it is possible that a payment will have been made
         by the Bank that should not have been made (an "Overpayment") or that
         an additional payment that will not have been made by the Bank could
         have been made (an "Underpayment"). In the event that the Auditors,
         based upon the assertion of a deficiency by the Internal Revenue
         Service against the Bank or Mr. Matson that the Auditors believe has a
         high probability of success, determine that an Overpayment has been
         made, such Overpayment shall be treated for all purposes as a loan to
         Mr. Matson that he shall repay to the Bank, together with interest at
         the applicable

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         federal rate specified in section 7872(f)(2) of the Code; provided,
         however, that no amount shall be payable by Mr. Matson to the Bank if
         and to the extent that such payment would not reduce the amount that is
         nondeductible under section 280G of the Code or is subject to an excise
         tax under section 4999 of the Code. In the event that the Auditors
         determine that an Underpayment has occurred, such Underpayment shall
         promptly be paid or transferred by the Bank to, or for the benefit of,
         Mr. Matson, together with interest at the applicable federal rate
         specified in section 7872(f)(2) of the Code.

         11.      MODIFICATION.

         Any modification of this Agreement will be effective only if it is in
writing and signed by the parties to be bound thereby.

         12.      ENTIRE AGREEMENT.

         This Agreement constitutes the entire agreement between the Bank and
Mr. Matson pertaining to the subject matter hereof, and supersedes all prior or
contemporaneous written or verbal agreements and understandings with Mr. Matson
in connection with the subject matter hereof.

         13.      GOVERNING LAW.

                  This Agreement and the rights and obligations hereunder shall
be governed by the laws of the State of California, and the parties to this
Agreement specifically consent to the jurisdiction of the courts of California
over any action arising out of or related to this Agreement.

         14.      SEVERABILITY.

         If any provision of this Agreement is held by a court of competent
jurisdiction to be invalid, void or unenforceable, the remaining provisions
shall, nevertheless, continue in full force and effect without being impaired or
invalidated in any way.

         15.      WAIVER.

         The parties hereto shall not be deemed to have waived any of their
respective rights under this Agreement unless the waiver is in writing and
signed by such waiving party. No delay in exercising any right shall be a waiver
nor shall a waiver on one occasion operate as a waiver of such right on a future
occasion.

         16.      NOTICES.

         All notices provided for herein shall be in writing and shall be deemed
to have been given when delivered personally, when deposited in the United
States mail, registered or certified, postage prepaid, or when delivered to a
messenger service, addressed as follows:

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                  To the Bank:              Paul Fearer
                                            Executive Vice President
                                            Union Bank of California, N.A.
                                            350 California Street
                                            San Francisco, CA 94104

                  To  Mr. Matson:           David I. Matson
                                            Chief Financial Officer
                                            Union Bank of California, N.A.
                                            400 California Street
                                            San Francisco, CA 94104

         17.      EXECUTIVE COMPENSATION AND BENEFITS COMMITTEE.

         If at the time of a determination under this Agreement no Committee is
in existence, references to the Committee under this Agreement shall be deemed
to be references to the Board.

         18.      WITHHOLDING TAXES.

         The Bank shall withhold and deduct all applicable federal and local
taxes, as required by applicable laws, from any payments made under this
Agreement.

         IN WITNESS WHEREOF, the parties have executed this Agreement by their
duly authorized officers or agents.



Dated:  _______________                     UNION BANK OF CALIFORNIA, N.A.



                                            By_________________________________
                                               Paul Fearer
                                               Executive Vice President



Dated:  _______________                     ____________________________________
                                                              David I. Matson

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                                    EXHIBIT A

                           GENERAL AND SPECIAL RELEASE


         1.       In return for the benefits provided for in subparagraphs 6(d)
(i) or 6(f)(ii) of the Employment Agreement entered into as of January 1, 1998
(the "Agreement"), the adequacy of which as consideration is hereby
acknowledged, David I. Matson (hereinafter "Mr. Matson") hereby fully releases
and forever discharges Union Bank of California, N.A., its parent, affiliated,
and subsidiary corporations, its and their successors and assigns, and the past
and present officers, directors, employees, shareholders, agents and employee
benefit plans of each (hereinafter collectively the "Bank") from any and all
actions, causes of action, claims, demands, damages, and liabilities of
whatsoever kind or character, in law or in equity, now known or unknown,
suspected or unsuspected, past or present, that he has ever had or currently may
have against them or any of them including, but not limited to, claims of race,
sex, religious, age, disability, medical condition (in and as defined under
California law), marital status, veteran status, sexual orientation or national
origin discrimination under Title VII of the Civil Rights Act of 1964, as
amended, the Americans with Disabilities Act of 1990, as amended, the Age
Discrimination in Employment Act, as amended, the Family and Medical Leave Act,
the California Fair Employment and Housing Act, and any other federal, state or
local laws, arising out of or in any way related to Mr. Matson's employment with
the Bank or the termination of that employment. Mr. Matson further agrees not to
institute in any state or federal court any action or claim of any kind against
the Bank. Execution of this document by Mr. Matson operates as a complete bar
and defense against any and all current claims of any type that may be made by
Mr. Matson against the Bank, provided, however, that nothing in this release is
intended to affect Mr. Matson's right to seek a remedy in arbitration to resolve
any controversy arising out of the construction or application of the terms,
provisions or conditions of the Agreement.

         2.       Mr. Matson and the Bank understand and expressly agree that
the release granted in Paragraph 1 extends to all claims of every nature and
kind, known or unknown, suspected or unsuspected, past or present, which Mr.
Matson may have against the Bank arising from or related to his employment with
the Bank or the termination of that employment and that any and all rights
granted to Mr. Matson under Section 1542 of the California Civil Code or any
analogous state law, federal law, or regulation are hereby expressly waived.
Section 1542 of the California Civil Code provides that:

         A general release does not extend to claims which the creditor does not
         know or suspect to exist in his favor at the time of executing the
         release, which if known by him must have materially affected his
         settlement with the debtor.

         3.       Mr. Matson has read this instrument, has had the opportunity
of consulting with an attorney regarding it, and signs it voluntarily and with
the intention of being bound by it. Mr. Matson understands that he is waiving
legal rights by signing this Release.

                                      -1-

<PAGE>


         4.       Mr. Matson acknowledges that he has been given at least
twenty-one (21) days within which to consider this Release. Mr. Matson
understands that he may revoke this Release upon written notice to the Bank
within seven (7) days after execution of it and that this Release will not
become effective or unenforceable until the eighth (8th) day after its
execution.



Dated:  _______________                     ____________________________________
                                              David I. Matson

                                      -2-