NEW YORK - Sovereign Bancorp visited Wall Street Tuesday, saying the final phase of its acquisition of deposits, assets, and branches from FleetBoston Financial Corp. went better than expected and outlining progress on some initiatives.
The $36 billion-asset Wyomissing, Pa.-based company said it retained 99.5% of the $12 billion of total deposits acquired from Fleet in that company's divestiture of New England branches and deposits after its merger last year with BankBoston Corp.
Sovereign said it had deposit runoff of $54 million.
"We only dreamed that our deposit retention through month's end after our final closing and integration would be above 99%," said Jay Sidhu, Sovereign's president and chief executive officer, in a statement.
Still, the purchases of nearly 300 Fleet branches in Massachusetts, Connecticut, Rhode Island, and New Hampshire have had glitches. The acquisitions were divided into three stages. After the first stage in March, customers in Connecticut complained they could not use their old ATM cards because Sovereign's technology did recognize their personal identification codes. There were also 15-minute delays at Sovereign's call center on the first day.
The purchase was done in stages to make it more financially viable for Sovereign, which helped finance the deal through debt. Since Dec. 31, Sovereign said, its borrowing has been reduced by about $4 billion and the leverage portion of its balance sheet has been cut to less than 25%, down from 40% at the end of December, allowing it to reduce its funding costs.
