Bank of America Corp, the second-largest U.S. bank, said on Tuesday it has suffered a $3 billion loss stemming from its exposure to collateralized debt obligations.

The pretax loss would be reflected in fourth-quarter results, and could grow if market conditions worsen, Chief Financial Officer Joe Price said at a Merrill Lynch & Co. banking and financial services conference.

Bank of America joins a growing number of banks, including Citigroup Inc, Merrill Lynch and Morgan Stanley, to announce multibillion-dollar write-downs for exposure to mortgages and other debt instruments that investors are no longer willing to buy.

Price also said Bank of America is setting aside more money for potential losses elsewhere, but considers the losses manageable.

Analysts, on average, had expected Bank of America to post a fourth-quarter profit of $1.10 per share on revenue of $18.82 billion, according to Reuters Estimates.

(Reporting by Jonathan Stempel; Editing by Brian Moss)