According to Wall Street Journal reports, Bank of America Corp may get billions of dollars as additional aid from the US government, in order to help it absorb losses arising due to the bank’s acquisition of Merrill Lynch & Co on January 1.

Though the terms of the deal are still being discussed, people familiar with the proceedings said that the Treasury may absorb some losses on Merrill’s assets, thereby capping the liability of the bank.

The country’s biggest bank by assets has already received $25 billion from the government – the $10 billion proposed for Merrill inclusive - out of the $700 bailout fund.

Details of the deal will be disclosed on January 20, after Bank of America posts its first quarterly loss in seventeen years, having assimilated the Merrill Lynch and Countrywide Financial Corp buyouts.

Gary Townsend, president Hill-Townsend Capital LLC in Chevy Chase, Maryland, said: “Bank of America has all kinds of problems with its acquisitions. They’ve been so acquisitive, they find themselves with very little in tangible equity.”

Townsend and Paul Miller - of Friedman Billings Ramsey Inc – noted that ever since Kenneth Lewis became the bank’s CEO in 2001, he has spent $129 billion on acquisitions – which include credit-card issuer MBNA, lenders FleetBoston Financial Corp. and LaSalle Bank, and investment manager U. S. Trust Co.

The recent rescue of two money-losing companies in six months- Merrill Lynch and Countrywide – indicates that Lewis has “overreached.”