Despite Bank of America's ( BAC - Get Report) protestations to the contrary, the banking behemoth may be "next in line" to receive additional government assistance, according to a report by credit-analysis firm Egan Jones. Egan Jones estimates that BofA will require an additional $100 billion over the next 100 days, due to big losses from its acquisitions of Countrywide Financial and Merrill Lynch, both of which nearly collapsed due to toxic mortgage holdings. Shares of major banks have been hammered in recent days as investors worried about their fate while Citigroup ( C - Get Report) hammered out a deal with the government to convert part of its preferred equity stake into common stock. The move will unburden the company from the hefty preferred dividend payments it must make and improve its tangible common equity, a closely watched accounting metric. After the announcement, Citi's were down 36% to $1.57 in afternoon trading, with BofA's down 15% at $4.52. Competitor Wells Fargo ( WFC - Get Report) was down a more modest 6.9% at $13.40. Bank of America has said repeatedly that it is healthy enough to survive without Uncle Sam stepping in. CEO Ken Lewis said in an internal memo this week that BofA "does not need further assistance today and I don't believe we'll need any more in the future." However, according to Egan-Jones, Bank of America may have no choice but to seek further aid. The firm said that a $15 billion capital injection and $120 billion in backstops offered by the government for BofA's purchase of Merrill "are not enough." Egan-Jones cited BofA's accelerated provisions for loan losses in the fourth quarter to $8.5 billion from $3.3 billion, causing a plunge in profit. "With the de facto collapse of Citi's common share values," says the report, "attention will shortly turn to
BofA, which will probably follow a similar pattern: killing the common and preferred shareholders and eventually stabilizing credit ( BofA is too big to fail)."