Sovereign Bancorp Suffers: Fool by Numbers

On Oct. 17, Sovereign Bancorp (NYSE: SOV  ) released earnings for the third quarter ended Sept. 30.

  • Profit dropped 68% thanks to credit losses in the auto lending and home equity portfolios.
  • Sovereign Bancorp and competitors KeyCorp (NYSE: KEY  ) and PNC Financial Services (NYSE: PNC  ) are not rated highly by the Motley Fool CAPS community, which includes more than 70,000 investors rating more than 5,000 companies. Sovereign earns one star out of five, as does KeyCorp, while PNC earns two stars.

(Figures in millions, except per-share data)

Income Statement Highlights

Q3 2007

Q3 2006

Change

Net Interest Income

 $456.8

 $491.8

(7.1%)

Net Profit

 $58.2

 $184.0

(68.4%)

EPS

 $0.11

 $0.37

(70.3%)

*Non-GAAP EPS as reported by the company.

Get back to basics with a look at the income statement.

Ratio Checkup

Q3 2007

Q3 2006

Change*

Net Interest Margin

2.74%

2.64%

0.10%

Efficiency Ratio

57.12%

53.01%

4.11%

Nonperforming Assets / Assets

0.39%

0.30%

0.09%

Return on Average Assets

0.28%

0.81%

(0.53%)

Return on Average Equity

2.63%

8.47%

(5.84%)

*Expressed in percentage points.

Find out more about bank performance ratios.

Balance Sheet Highlights

Assets

Q3 2007

Q3 2006

Change

Investments

 $15,290

 $13,842

10.5%

Loans

 $57,148

 $63,178

(9.5%)

Liabilities

Q3 2007

Q3 2006

Change

Deposits

 $50,098

 $52,784

(5.1%)

Total Liabilities

 $77,735

 $81,466

(4.6%)

Learn about bank assets and bank liabilities.

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