S&P: Sovereign Bancorp unchanged

Standard & Poor's said its ratings on Sovereign Bancorp (BBB/stable) and its subsidiaries will not be affected by the company's capital-raising efforts.

The company announced that it plans to raise $1 billion in common equity and its bank subsidiary, Sovereign Bank (BBB+/stable/A-2), plans to issue $500 million in subordinated debt, the agency said.

Although S&P said it views the capital raise as a positive development for Sovereign, it believes that the company's performance will continue to be pressured, as Sovereign navigates through the current challenging economic environment, characterized by weakening asset quality, specifically in consumer-related assets.

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