Sovereign Bancorp, Wyomissing, Pa., said Friday that it has closed its purchase of Fleet Financial Group's automobile finance division.

The division consists of $2 billion of indirect auto loans, dealer floor plan loans, and loans to auto leasing companies.

"This transaction enhances Sovereign's transition to becoming a super community bank by increasing consumer and business loans to about 35% of total loans," said Jay S. Sidhu, president and chief executive officer.

The bank said it established an initial loan loss reserve of 1.4% of indirect auto loans, or about $19.2 million, in connection with the transaction.

Sovereign, which had assets of $9.8 billion at midyear, has been an aggressive acquirer. Several pending deals will boost its assets to $17.2 billion, the company said.

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