Jay Sidhu is triumphant. The chairman and CEO of Sovereign Bancorp jabs his index finger at a chart that shows the bank's share price rising 3.6 percent in a single recent month, when most of its rivals' declined.

"This is the real news!" exclaims Sidhu, sitting in his ground-floor Philadelphia office. "Investors have been saying, 'Let's wait and see what happens to the market, what happens to our capital levels, what happens with higher interest rates.' Well, now they see. All those issues are behind us."

Nothing gets the voluble Sidhu going more than Sovereign's chronically undervalued -- in his estimation -- share price. Last October, during his third-quarter earnings conference call, he lectured analysts for ten minutes on why the bank deserved a higher price-earnings multiple.

That same day Sidhu put out an argumentative press release calling the share price "totally unwarranted": Sovereign had hit all its promised targets, increasing...