Bank of America Corp requesting additional capital from the U.S. Government, according to people familiar with the situation quoted by reports today.
Sources told the Wall Street Journal and Reuters that the aid will help absorb losses related to the purchase of Merrill Lynch last month, a sale which the government favored to prevent further turmoil in the financial system.
Bank of America was already given $25 Billion in federal funds. Citigroup and AIG have had funds injected twice so BoA is likely to become the third raising worries that other banks will ask for more capital too.
Shares of Bank of America plunged $2.04 or 20 percent to $8.16 a share by 9:50 a.m. in the New York Stock Exchange Thursday.