Wells Fargo & Co and U.S. Bancorp reported better-than-forecast quarterly earnings, helped by recent acquisitions, while larger rival Bank of America Corp got a boost from Merrill Lynch.

Bank of America , the top U.S. bank by assets, reported a wider-than-expected loss, hurt by high loan losses and repayment of a U.S. government bailout.

But the Charlotte, North Carolina-based bank said its credit problems were beginning to stabilize. Its fourth-quarter provision for credit losses was $10.1 billion, down 14 percent from the third quarter.

I would describe the outlook statement as cautiously optimistic, said Neil Smith, an analyst at WestLB. It could have been worse. They key phrase is, 'We have seen stabilization of our credit costs.' That's got to be good for the consumer business.

The fourth-quarter results for the three banks underscore how the biggest banks are getting bigger, and profiting from it along the way. The winners and losers in the next credit cycle may be determined in large part by which banks are gaining assets now.

I think we are approaching some sort of normality here, said Mal Polley, chief investment officer, Stewart Capital Advisors. I think chargeoffs will still be high, but it's definitely stabilized.

Bank of America posted a quarterly loss of $5.2 billion, or 60 cents per share, compared with a year-earlier loss of $2.4 billion, or 48 cents a share. Analysts' average forecast was a loss of 52 cents per share, according to Thomson Reuters I/B/E/S.

But the bank got a boost from its controversial Merrill Lynch acquisition, which helped cost Ken Lewis his job as chief executive amid an uproar over the decision to proceed with the deal despite mounting trading losses at the investment bank.

Net income in Bank of America's global markets unit was $1.2 billion, compared with a net loss of $3.7 billion a year earlier. The bank cited a more favorable trading environment and the addition of Merrill.

The Merrill acquisition also bolstered the global wealth and investment management unit, where net income more than doubled to $1.3 billion.

Acquisitions also helped at Wells Fargo , the fourth-largest U.S. bank. It reported a profit of $2.82 billion, or 8 cents a share. Analysts on average expected a loss of 1 cent a share, according to Thomson Reuters I/B/E/S.

Wells Fargo bought Wachovia Corp at the end of 2008, almost doubling Wells' size and giving it a nationwide footprint.

Wells Chief Financial Officer Howard Atkins said losses from Wachovia are tracking better than originally estimated at the time of the merger.

U.S. Bancorp said fourth-quarter profit nearly doubled to $602 million as fee income rose.

Its loan growth was largely due to several acquisitions since late 2008. In November of that year it bought the banking operations of failed California lenders Downey Financial and PFF Bancorp. Both deals were backed by banking regulator the Federal Deposit Insurance Corp. In October 2009 it acquired the banking subsidiaries of Illinois-based FBOP Corp.

Bank of America's quarterly revenue jumped 59 percent to $25.4 billion, primarily due to the addition of Merrill Lynch.

For the full year 2009, it posted net income of $6.3 billion, compared with $4 billion in 2008 during the height of the financial crisis.

In early December, Charlotte, North Carolina-based Bank of America repaid $45 billion in Troubled Asset Relief Program funds, leading a wave of bailout repayments by the country's biggest banks.

Wells Fargo repaid a $25 billion bailout it received under the Troubled Asset Relief Program, and U.S. Bancorp repaid TARP funds earlier last year.

Bank of America shares were up 0.4 pct in late-morning trade, Wells Fargo was down 1.1 pct, and U.S. Bancorp rose 2.6 pct.

(Reporting by Joe Rauch in Charlotte, N.C., and Elinor Comlay in New York; writing by Christian Plumb and Dan Wilchins; editing by John Wallace)