Banco Santander Issues Statement.

MADRID, Spain -- Banco Santander Central Hispano, S.A. announced today that it and Sovereign Bancorp, Inc. have revised their Investment Agreement and that they have been advised by the staff of the New York Stock Exchange (NYSE) that the initial issuance of shares to Santander under the Investment Agreement as revised will not require shareholder approval under the NYSE rules.

"Santander looks forward to proceeding toward implementation of the Investment Agreement with Sovereign as soon as possible. We are convinced that this financial investment by Santander will create long-term value for all Sovereign shareholders," Santander said.

The revisions to the Investment Agreement include the following:

--The elimination of Santander's veto with respect to the removal of Sovereign's chief executive officer and of the requirement that any new Sovereign CEO be reasonably acceptable to Santander. The Santander board will instead have the right to approve whether any new Sovereign CEO will join the Santander board.

--The elimination of Santander's obligation to vote its Sovereign shares in favor of Sovereign's board nominees.

--The clarification that Santander's right to veto changes in Sovereign's by-laws applies only to changes that would adversely affect Santander's rights under the Investment Agreement.

--The clarification that Sovereign shareholders' approval must be obtained for Santander to vote any shares it owns in excess of 19.9% of the outstanding Sovereign shares whether or not there is a change in Pennsylvania law.

--An amendment as to the use of Sovereign treasury shares under the Investment Agreement to increase Santander's stake from 19.9% to 24.9%. The favored option now will be open market transactions instead of treasury stock to achieve the 24.9% level.

--The elimination of provisions providing for the continuation on Sovereign's board of Sovereign directors in office at the time of any future acquisition of Sovereign by Santander for an additional ten-year period as a way to ensure the fulfillment of certain obligations to the community. A new mechanism based on an independent non-profit organization will be used for the same purpose.

--The addition of a "fiduciary out" exception to the restrictions on Sovereign's ability to take actions in connection with a third-party offer to acquire Sovereign during the period before consummation of the Investment Agreement. If Sovereign exercises this fiduciary out, Santander would have the option to either terminate the Investment Agreement and receive a breakup fee of $200 million from Sovereign (equivalent to approximately 2.5% of Sovereign's current market value) or to consummate the investment transaction as agreed.

Santander acknowledges the effort and governance expertise that NYSE Regulation has brought to bear on this matter.

It is expected that the investment transaction and Sovereign's associated acquisition of Independence Community Bank Corp. will be completed according to the original transaction timetable, which contemplates consummation of the two transactions not later than July 1, 2006.

Santander (SAN.MC, STD.N) is the 9th largest bank in the world by market capitalization and the largest in the Euro Zone. Founded in 1857, Santander has 63 million customers, 10,099 offices and a presence in over 40 countries. It is the largest financial group in Spain and Latin America, and is a major player elsewhere in Europe, including the United Kingdom through its Abbey subsidiary and Portugal, where it is the third-largest banking group. Through Santander Consumer it also operates a leading consumer finance franchise in Germany, Italy, Spain and nine other European countries. In 2004, Santander recorded 3.6 billion euro in net attributable profits. In Latin America, Santander manages over US$130 billion in business volumes (loans, deposits and off-balance sheet assets under management) through 4,100 offices in 10 countries.