"Sovereign has been deeply committed to serving Massachusetts communities since we opened our doors more than four years ago," says Joe Campanelli, president and COO, Sovereign Bank of New England. "This agreement is an enhancement on what we have already been able to accomplish and what our aspirations are to serve the socially and economically diverse communities in the Commonwealth."

One of the programs that benefits from the agreement is the Soft Second mortgage program, which offers first time homebuyers low down payments and interest rates and allows them to eliminate PMI, among other things, thus enabling them to afford homes. "This is a very important program," Tom Callahan, executive director of the Massachusetts Affordable Housing Alliance, tells GlobeSt.com. "It's the state's most affordable program for first time homebuyers."

The agreement also has designated funds for a number of other programs. Small business lending programs will receive $1.2 billion; consumer loans will benefit from $1.2 billion. A commercial real estate development part will receive $222 million and equity investments will account for $30 million.

"Banks are less likely these days to enter into community investment agreements," Maureen Flynn, deputy director of the Massachusetts Association of Community Development Corp., says. "Not only is this a good example of an agreement that benefits communities, this is an example of what banks can and should do in the future."