PHILADELPHIA, July 20 /PRNewswire-FirstCall/ -- Sovereign Bancorp, Inc.
("Sovereign") (NYSE: SOV), parent company of Sovereign Bank ("Bank"),
announced that its Board of Directors has authorized a stock repurchase
program of up to 20 million shares, approximately 5% of shares outstanding, to
commence at the conclusion of a previously authorized repurchase program.
This buyback program is in addition to existing authorizations to repurchase
up to approximately 20 million shares, under which the Company has previously
repurchased 16 million shares. These programs have no prescribed time period
in which to fill the authorized repurchase amount.
Commenting on the Board's authorization, Jay S. Sidhu, Sovereign's
Chairman and Chief Executive Officer, said, "The action taken by our Board is
reflective of Sovereign's financial strength. We are currently generating
approximately $200 million of average tangible common equity per quarter and
our capital ratios are near management's goal of approximately 7% Tier 1
Leverage and 4.75% to 5.00% tangible common equity to tangible assets. At the
current time, we feel share repurchases are the best use of our excess capital
relative to other alternatives. While continuing to manage to our capital
targets via stringent balance sheet management, we have returned 86% of our
net income to shareholders year-to-date through dividends and share
repurchases," Sidhu continued.
Share repurchases will be made from time to time and will be effected on
the open market, in block trades, or in privately negotiated transactions, and
in compliance with applicable laws, including Securities and Exchange
Commission Rule 10b-18 and Regulation M.
Sovereign Bancorp, Inc., ("Sovereign") (NYSE: SOV), is the parent company
of Sovereign Bank, a $60 billion financial institution with more than 650
community banking offices, over 1,000 ATMs and approximately 10,000 team
members with principal markets in the Northeast United States. Sovereign
offers a broad array of financial services and products including retail
banking, business and corporate banking, cash management, capital markets,
trust and wealth management and insurance. Sovereign is the 19th largest
banking institution in the United States. For more information on Sovereign
Bank, visit http://www.sovereignbank.com or call 1-877-SOV-BANK.
Note:
This press release contains financial information determined by methods
other than in accordance with U.S. Generally Accepted Accounting Principles
("GAAP"). Sovereign's management uses the non-GAAP measure of Operating/cash
Earnings, and the related per share amount, in their analysis of the company's
performance. This measure, as used by Sovereign, adjusts net income
determined in accordance with GAAP to exclude the effects of special items,
including significant gains or losses that are unusual in nature or are
associated with acquiring and integrating businesses, and certain non-cash
charges. Operating/cash earnings for the first and second quarters of 2005
represent net income adjusted for the after-tax effects of merger-related and
integration charges, certain restructuring charges and the amortization of
intangible assets. Since certain of these items and their impact on
Sovereign's performance are difficult to predict, management believes
presentations of financial measures excluding the impact of these items
provide useful supplemental information in evaluating the operating results of
Sovereign's core businesses. These disclosures should not be viewed as a
substitute for net income determined in accordance with GAAP, nor are they
necessarily comparable to non-GAAP performance measures that may be presented
by other companies.
This press release contains statements of Sovereign's strategies, plans,
and objectives, as well as estimates of future operating results for 2005 for
Sovereign Bancorp, Inc. as well as estimates of financial condition, operating
and cash efficiencies and revenue generation. These statements and estimates
constitute forward-looking statements (within the meaning of the Private
Securities Litigation Reform Act of 1995), which involve significant risks and
uncertainties. Actual results may differ materially from the results
discussed in these forward-looking statements. Factors that might cause such
a difference include, but are not limited to, general economic conditions,
changes in interest rates, deposit flows, loan demand, real estate values and
competition; changes in accounting principles, policies, or guidelines;
changes in legislation or regulation; Sovereign's ability in connection with
any acquisition to complete such acquisition and to successfully integrate
assets, liabilities, customers, systems and management personnel Sovereign
acquires into its operations and to realize expected cost savings and revenue
enhancements within expected time frame; the possibility that expected one-
time merger-related charges are materially greater than forecasted or that
final purchase price allocations based on the fair value of acquired assets
and liabilities and related adjustments to yield and/or amortization of the
acquired assets and liabilities at any acquisition date are materially
different from those forecasted; and other economic, competitive,
governmental, regulatory, and technological factors affecting the Company's
operations, integrations, pricing, products and services.
Sovereign Bancorp is followed by several market analysts. Please note
that any opinions, estimates, forecasts, or predictions regarding Sovereign
Bancorp's performance or recommendations regarding Sovereign's securities made
by these analysts are theirs alone and do not represent opinions, estimates,
forecasts, predictions or recommendations of Sovereign Bancorp or its
management. Sovereign Bancorp does not by its reference to any analyst
opinions, estimates, forecasts regarding Sovereign's performance or
recommendations regarding Sovereign's securities imply Sovereign's endorsement
of or concurrence with such information, conclusions or recommendations.
SOURCE Sovereign Bancorp, Inc.
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Related links:
http://www.sovereignbank.com
CONTACT:
FINANCIAL: Mark McCollom, +1-610-208-6426,
or mmccollo@sovereignbank.com, or Stacey Weikel, +1-610-208-6112,
or sweikel@sovereignbank.com; or MEDIA: Ed Shultz,
+1-610-378-6159, or eshultz1@sovereignbank.com, all of Sovereign
Bancorp
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