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<P style="font-size: 14pt" align="center"><B>UNITED STATES<BR>
SECURITIES AND
EXCHANGE COMMISSION<BR>
<FONT style="font-size: 12pt">Washington, D.C. 20549
</FONT></B>

<P style="font-size: 18pt" align="center"><B>FORM 8-K</B>

<P style="font-size: 12pt" align="center"><B>CURRENT REPORT<BR>
Pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934</B>

<P style="font-size: 10pt" align="center"><B>Date of Report (Date of earliest
event reported): September 19, 2008</B>


<P style="font-size: 24pt" align="center"><B>Sovereign Bancorp,
Inc.<BR>
</B><FONT style="font-size: 10pt">(Exact name of registrant as
specified in its charter) </FONT>
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  <TD width="32%">&nbsp;</TD>
  <TD width="1%">&nbsp;</TD>
  <TD width="33%">&nbsp;</TD>
  <TD width="1%">&nbsp;</TD>
  <TD width="32%">&nbsp;</TD>
 </TR>
 <TR valign="bottom">
  <TD style="border-bottom: #000000 1px solid"><B>Pennsylvania</B></TD>
  <TD>&nbsp;</TD>
  <TD style="border-bottom: #000000 1px solid"><B>1-16581</B></TD>
  <TD>&nbsp;</TD>
  <TD style="border-bottom: #000000 1px solid"><B>23-2453088</B></TD>
 </TR>
 <TR valign="top">
  <TD>(State or other Jurisdiction of Incorporation)</TD>
  <TD>&nbsp;</TD>
  <TD>(Commission File Number)</TD>
  <TD>&nbsp;</TD>
  <TD>(IRS Employer Identification No.)</TD>
 </TR>

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cellpadding="0" width="100%" border="0">

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  <TD width="49%">&nbsp;</TD>
  <TD width="1%">&nbsp;</TD>
  <TD width="49%">&nbsp;</TD>
 </TR>
 <TR valign="bottom">
  <TD style="border-bottom: #000000 1px solid"><B>1500 Market Street,
Philadelphia, Pennsylvania<BR>
</B></TD>
  <TD>&nbsp;</TD>
  <TD style="border-bottom: #000000 1px solid"><B>19102</B></TD>
 </TR>
 <TR valign="top">
  <TD>(Address of Principal Executive Offices)</TD>
  <TD>&nbsp;</TD>
  <TD>(Zip Code)</TD>
 </TR>

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<P style="font-size: 10pt" align="center">Registrant&#8217;s telephone number,
including area code: <B>(267) 256-8601</B>
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 <TR>
  <TD style="border-bottom: #000000 1px solid" nowrap><B>n/a<BR>
</B></TD>
 </TR>
 <TR>
  <TD nowrap>(Former name or former address if changed since last report.)</TD>
 </TR>

</TABLE>


<P style="font-size: 10pt" align="left">Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of
the registrant under any of the following provisions:

<P style="font-size: 10pt" align="left"><FONT face="Wingdings">o</FONT> Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)<BR>
<BR>
<FONT face="Wingdings">o</FONT> Soliciting material pursuant
to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)<BR>
<BR>
<FONT
face="Wingdings">o</FONT> Pre-commencement communications pursuant to Rule
14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))<BR>
<BR>
<FONT
face="Wingdings">o</FONT> Pre-commencement communications pursuant to Rule
13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))<BR>


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<P style="font-size: 10pt" align="left"><B>Item&nbsp;8.01. Other Events</B>

<P style="font-size: 10pt; text-indent: 4%" align="left">On September&nbsp;19,
2008, Sovereign Bancorp, Inc. (NYSE: SOV), parent company of Sovereign Bank,
reported that it has taken a major step to reduce risk in its investment
portfolio by selling its entire portfolio of collateralized debt obligations
(CDOs).

<P style="font-size: 10pt; text-indent: 4%" align="left">The CDO portfolio has
experienced significant volatility over the past year as a result of conditions
in the credit markets. Sovereign decided to eliminate the risk of future
volatility in its capital levels.

<P style="font-size: 10pt; text-indent: 4%" align="left">The CDOs were carried
at fair value on Sovereign&#8217;s balance sheet on June&nbsp;30, 2008 and the
unrealized loss for the CDOs of $254&nbsp;million, net of taxes, was recorded
in other comprehensive income within stockholders&#8217; equity and as a result
fully reflected in tangible capital levels on that date. As a result of the CDO
sale, Sovereign&#8217;s tangible capital levels were reduced by an additional
$136&nbsp;million. The unrealized loss at June&nbsp;30, 2008 plus the
additional loss, net of tax, from the sale will be reflected in our statement
of operations for the quarter ending September&nbsp;30, 2008. On a pro-forma
basis at June&nbsp;30, 2008, this sale would have reduced our tangible capital
levels by 17 basis points.

<P style="font-size: 10pt; text-indent: 4%" align="left">Sovereign continues
to be proactive in reducing risk on its balance sheet. When Sovereign raised
$1.9&nbsp;billion in new regulatory capital in May, a number of factors were
taken into consideration including a possible decline in its investments.
Sovereign is well capitalized and has adequate cushion according to all
regulatory standards.

<P style="font-size: 10pt; text-indent: 4%" align="center">&nbsp;

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<P style="font-size: 10pt" align="center"><B>SIGNATURES</B>

<P style="font-size: 10pt; text-indent: 4%" align="left">Pursuant to the
requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly
authorized.

<P style="font-size: 10pt; margin-left: 45%" align="left">SOVEREIGN BANCORP,
INC.

<P style="font-size: 10pt" align="left">Dated: September&nbsp;19, 2008

<P style="margin-top: -11pt; font-size: 10pt; margin-left: 45%"
align="left">By: <U><B>/</B>s/ Stacey V.
Weikel&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>
<BR>
Name: Stacey V. Weikel <BR>
Title: Senior Vice President

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{"company-data": {"conformed-name": "SOVEREIGN BANCORP INC", "cik": "0000811830", "assigned-sic": "6035", "irs-number": "232453088", "state-of-incorporation": "PA", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-16581", "film-number": "081080571"}, "business-address": {"street1": "1500 MARKET ST", "city": "PHILADELPHIA", "state": "PA", "zip": "19102", "phone": "2155574630"}, "mail-address": {"street1": "MC11-900-IR5", "street2": "1130 BERKSHIRE BLVD", "city": "WYOMISSING", "state": "PA", "zip": "19610"}}
Filed by Bowne Pure Compliance
UNITED STATES
SECURITIES AND
EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest
event reported): September 19, 2008
Sovereign Bancorp,
Inc.
(Exact name of registrant as
specified in its charter)
Pennsylvania
1-16581
23-2453088
(State or other Jurisdiction of Incorporation)
(Commission File Number)
(IRS Employer Identification No.)
1500 Market Street,
Philadelphia, Pennsylvania
19102
(Address of Principal Executive Offices)
(Zip Code)
Registrant's telephone number,
including area code:
(267) 256-8601
n/a
(Former name or former address if changed since last report.)
Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of
the registrant under any of the following provisions:
o
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o
Soliciting material pursuant
to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule
14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule
13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 8.01. Other Events
On September 19,
2008, Sovereign Bancorp, Inc. (NYSE: SOV), parent company of Sovereign Bank,
reported that it has taken a major step to reduce risk in its investment
portfolio by selling its entire portfolio of collateralized debt obligations
(CDOs).
The CDO portfolio has
experienced significant volatility over the past year as a result of conditions
in the credit markets. Sovereign decided to eliminate the risk of future
volatility in its capital levels.
The CDOs were carried
at fair value on Sovereign's balance sheet on June 30, 2008 and the
unrealized loss for the CDOs of $254 million, net of taxes, was recorded
in other comprehensive income within stockholders' equity and as a result
fully reflected in tangible capital levels on that date. As a result of the CDO
sale, Sovereign's tangible capital levels were reduced by an additional
$136 million. The unrealized loss at June 30, 2008 plus the
additional loss, net of tax, from the sale will be reflected in our statement
of operations for the quarter ending September 30, 2008. On a pro-forma
basis at June 30, 2008, this sale would have reduced our tangible capital
levels by 17 basis points.
Sovereign continues
to be proactive in reducing risk on its balance sheet. When Sovereign raised
$1.9 billion in new regulatory capital in May, a number of factors were
taken into consideration including a possible decline in its investments.
Sovereign is well capitalized and has adequate cushion according to all
regulatory standards.
SIGNATURES
Pursuant to the
requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly
authorized.
SOVEREIGN BANCORP,
INC.
Dated: September 19, 2008
By:
/
s/ Stacey V.
Weikel
Name: Stacey V. Weikel
Title: Senior Vice President