WASHINGTON - SOVEREIGN Bancorp, in the process of being taken over by Spain's Santander, said on Friday it would eliminate 1,000 jobs by the end of 2009 to cope with the global financial crisis.

'Over the last several months, we conducted a thorough review of our projected 2009 budget in an effort to reduce our costs and become a more efficient bank,' said Mr Kirk Walters, Sovereign's acting chief executive.

'The analysis was part of a broader effort to focus on our fundamental lines of business and to set our long-term strategic direction.'

The reductions will take place across the company beginning in the fourth quarter of 2008 and continuing throughout 2009 at Sovereign, which faced a meltdown in its share price earlier this year before Santander stepped in.

'The decision to reduce our workforce was a very difficult one, especially during the holiday season,' said Mr Walters.

'There is never a good time to reduce staff, but this step is necessary, particularly during this economic environment. We are working to make the transition from the bank as smooth as possible for all affected team members.'

The Federal Reserve earlier this month approved the takeover by Santander, the euro zone's biggest bank by market capitalisation, of the Pennsylvania-based lender.

Sovereign has total assets of about US$79 billion (S$115.5 billion) and is the 22nd largest banking group in the United States.

With Santander's control over Sovereign, it will now have combined total assets of about US$120 billion in the United States. -- AFP