In Brief: Sovereign Revises Deal for Peoples of N.J.

Sovereign Bancorp's deal for Peoples Bancorp, Lawrenceville, N.J., will be accounted for as a purchase transaction, not a pooling as originally structured.

Changes in the marketplace prompted the decision, said chief financial officer Dennis S. Marlo.

"We find we can do a purchase deal without a lot of goodwill that would cut into our earnings," Mr. Marlo said.

In connection with the move, Sovereign and Peoples will repurchase a portion of $1.3 billion-asset Peoples' shares.

The capital infusion from the Peoples' acquisition would improve Sovereign's tangible capital ratio by over 100 basis points, the company said. Also, the acquisition would increase Sovereign's book value by about 25%.