Sovereign Bancorp shares fell 3.57% on Wednesday, a day after it said it would offer 20 million new shares to raise cash.

The Philadelphia company said it would sell additional shares through Salomon Smith Barney to strengthen its capital base. Its thin capital ratios, along with a highly leveraged balance sheet, have been among investors’ biggest concerns over the past year. The culprit is debt assumed to help fund Sovereign’s expansion into New England. Late last year the company sold some of its loan portfolio and cut 500 jobs to lower expenses, but that could not pay off all the debt Sovereign took out when it bought 300 branches from FleetBoston Financial Corp. early last year.

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