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As BAC gets hit with credit downgrades it has to post more collateral as a derivatives counterparty. The advantage of moving the derivatives from un-FDIC-insured Merrill to the FDIC-insured retail bank Bank of America N.A. is that BAC the holding company won't have to post as much collateral. In a worst case scenario all of BAC's equity could go toward paying off their derivative liabilities and then the FDIC would cover deposits. JP Morgan already does this, using their retail bank as their derivatives counterparty.

You could read into this that Merrill's derivatives liabilties are headed for trouble but you could also look at it as BAC looking to save money by adopting a practice that the best of breed in the industry have already been doing for years.

Felix Salmon wrote a pretty food piece on this at seekingalpha:

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