Bank of America (BofA) is expected to top the list of banks needing capital infusion when the US treasury announces its long awaited ''stress test'' results today. The bank, which took over beleaguered Merrill Lynch & Co last year (See: Bank of America buys Merrill Lynch), is expected to have urgently in need of $34 billion.

 The results of the tests for the top 19 US banks are due to be released at 5:00 pm in the US, after financial markets close, today.

The tests are a key element of the Obama administration's plan to stabilise banks and the US government has spent around three months conducting stress tests to determine their revenue, losses and capital needs.

Analysts expect that about 10 of the 19 banks being subject to stress-tests would need more capital.

These include Citigroup Inc, Wells Fargo & Co, Fifth Third Bancorp, GMAC LLC, KeyCorp, Regions Financial Corp and SunTrust Banks Inc.

Citigroup needs $5 billion, while GMAC LLC, the auto and mortgage lender, needs $11.5 billion, and Wells Fargo needs $15 billion, reports said.

The International Monetary Fund last month said that the potential bank losses in the US will be about $2.7 trillion as a result of the deepening economic slump. The IMF report said banks needed larger capital injections to weather the expected losses and restore investor confidence in the battered financial system. (See: Bank write-downs to touch $4.1 trillion, says IMF).

The banks that come out clean from the test include Bank of New York Mellon Corp, American Express Co, Goldman Sachs Group Inc, JPMorgan Chase & Co, MetLife Inc and Morgan Stanley.

 "The amount of capital now needed by BofA could exceed what the bank can raise by selling assets or more shares to the public," reported the Wall Street Journal.

This may force BofA to convert the government's preferred shares (that it received for the first bailout) into common stock. However, the banks are eager to avoid having the government increase its stake because that would dilute the holdings of the banks' existing shareholders.

BofA is also considering the sale of its $8 billion equity in China's No.2 lender, China Construction Bank, to meet its capital needs.

The huge shortfall in capital may also put pressure on CEO Kenneth Lewis, who was last week ousted by shareholders as chairman of the bank.

Lewis is accused of improperly failing to disclose Merrill's losses, and also for allowing Merrill to pay some $3.6 billion of bonuses to its own staff even as losses were mounting.

On a conference call on 20 April while announcing the bank's first quarter results, Lewis had told analysts that "we absolutely don't think we need additional capital," but added that credit conditions remained weak, especially in credit cards.

"Make no doubt about it, credit is bad, and we believe credit is going to get worse," Lewis said.

BofA's nonperforming assets skyrocketed 41 per cent in the quarter to $25.74 billion.

Federal Reserve chairman Ben Bernanke said on Tuesday that most of the capital-needy banks will be able to raise additional capital through "either issuance of new capital or through conversions and exchanges, or the sales of assets and other measures."

Timothy Geithner, the Treasury secretary, said on Wednesday that the results of the stress tests might be comforting news.

''It will help lift this fog of uncertainty over the financial system, and I think the results will be, on balance, reassuring,'' Geithner said on ''The Charlie Rose Show.''

 Many investors, such as Warren Buffett, have hit out at the government's "stress tests", saying they do not properly assess the industry's health. (See: Buffet blasts government 'stress tests' on US banks).

Shares of major US banks have nearly doubled since bottoming out in early March on expectations that the worst is over. However, the results of the tests may extend US equity market losses, analysts said.