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                                                                    EXHIBIT 10.2

March 23, 2005

Mr. Carlos Garcia
Santander BanCorp
Puerto Rico

Dear Mr. Garcia:

We hereby confirm the terms and conditions with regards to your ratification as
Senior Executive Vice President and Chief Operating Officer of Santander BanCorp
and Banco Santander Puerto Rico (hereafter "the Group"):

      1.    As agreed upon, we have agreed to terminate your employment
            agreement dated October 14, 2002 and the February 3, 2003 between
            you and Santander Securities, and which shall be replaced in
            accordance with the terms and conditions set forth herein, which
            shall be effective from January 1, 2005, without recourse amongst
            the parties.

      2.    In your position you will be responsible for and will supervise all
            business operations of the Group in Puerto Rico.

      3.    The conditions set forth herein shall be in full force and effect
            for two years commencing January 1, 2005 and ending, therefore, on
            January 1, 2007.

      4.    During the period whereby these conditions are in full force and
            effect, the Group may terminate your employment if there is just
            cause, without any compensation whatsoever. The Group may also
            terminate your employment without just cause. In this latter case,
            you shall receive as indemnity the greater of the following amounts:

                  a.    The pending gross amount due from the time of
                        termination of employment until the date of expiration
                        of this Agreement (January 1, 2007) in accordance to the
                        annual salary set forth in Section 5; or

                  b.    $1,000,000 gross

                  If by the term of expiration of this Agreement the parties
                  have not renewed the same, the Group shall pay, unless you
                  have been offered an extension to this Agreement under the
                  same terms and conditions hereby established and the extension
                  was rejected by you, in which case a payment of $1,000,000
                  shall be made as the final

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Carlos M. Garcia
March 23, 2005
Page 2

                  compensation for your separation from the Group, as so thereby
                  liberating you from any additional responsibility under this
                  Agreement, with exception to the temporary non-competition
                  clause under Section 7.

                  In the event of a change in control of the Group in Puerto
                  Rico, the Group shall compensate you the gross amount of
                  $1,000,000 if the Group does not maintain you in your present
                  position and classification, or if there is a separation from
                  your position, or if any of the terms set forth herein shall
                  not occur. Consequently this indemnity shall not be
                  cumulative. As to the effects of this Agreement, "change in
                  control" shall be defined as any circumstance that will cause
                  Banco Santander Central Hispano, S.A. to decrease its
                  beneficial ownership to less than 50% of the common stock in
                  circulation.

      5.    Your gross annual salary for the year 2005 shall be $525,000.00. For
            the year 2006 this annual gross salary shall be $550,000.00. This
            salary shall be distributed in the payment installments that the
            Group has established.

            You will remain under the bonus policy of the Group. In that regard
            this policy will be determined with each bonus period that will take
            place under the following terms:

                  a.    Three quarters ( 3/4) of its amount shall be determined
                        by reaching the annual budget of the Group and the
                        conditions established by the Group's Compensation
                        Committee.

                  b.    The remaining one-quarter will be based on the Santander
                        BanCorp stock in regard to other competitors of
                        reference in accordance to the agreed schedule, of which
                        the Santander BanCorp Compensation Committee shall
                        inform you.

                  Also, you may be eligible to participate in other compensation
                  schemes that may be established by the Compensation Committee.

      6.    The remainder of conditions and benefits shall be governed in
            accordance to the applicable policies for officers and employees of
            your position at the Bank and other terms and conditions agreed upon
            by you and so established in your October 14, 2002 and the February
            3, 2003 contracts.

      7.    You acknowledge that the functions and duties that you will perform
            under this agreement are of an essentially confidential nature, and
            as so you will privy of facts, matters, plans and strategies, as
            well as confidential financial information of the Group and its
            clients. Therefore, you agree to maintain in absolute
            confidentiality and abstain to disclose this information during and
            after the term of this agreement.

            In the supposed termination given under the circumstances
            contemplated under the before to last paragraph of the fourth
            section, in consideration of the benefits granted hereunder and the
            specific compensation recognized under such section, you shall
            refrain from performing similar services to those performed or that
            will perform for the Group nor for

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Carlos M. Garcia
March 23, 2005
Page 3

            any of its direct competitors of the Group within the jurisdiction
            of Puerto Rico until six months have elapsed from your date of last
            employment from the Group.

      8.    Should any dispute arise with regards to the interpretation,
            validity, compliance, or early termination of this agreement that
            shall not be solved by the parties, you hereby agree to submit to
            compulsory arbitration in the City of San Juan, Puerto Rico, in
            accordance to the American Arbitration Association rules. The party
            that requests the arbitration must notify the other party, no later
            than ten (10) days. The Bank shall pay the arbitration costs,
            including the arbiter fees. Each party shall be responsible for its
            own attorney's fees as well as the preparation and presentation of
            evidence.

      Please execute this agreement as a sign of your approval. I take the
      opportunity to wish you great success in your functions.

      Sincerely,

      By: /s/ Maria Calero
      Executive Vice President

      Signature of approval:

      By: /s/ Carlos M. Garcia