Charlotte-based Bank of America has reached an agreement for an additional $20 billion in support from the government's emergency bailout fund.
The deal also provides government guarantees against losses on
up to $118 billion in troubled assets. The agreement was announced shortly after midnight following marathon negotiations between the bank and federal officials. The $20 billion injection of fresh capital will be similar to assistance provided in November to another troubled bank,
Bank of America will use the money from the rescue fund to help
it absorb losses at Merrill Lynch.
The loan guarantees will cover about $118 billion in loans and
other holdings such as securities backed by residential and commercial real estate loans. Most of the holdings were obtained by the bank in the Merrill Lynch acquisition.
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