##### Table of Contents





UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
  FORM 10-K
  X

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal
    year ended December 31, 2009   Commission file number: 1-7182
  MERRILL LYNCH & CO., INC.
    Delaware

13-2740599(State or other jurisdiction of
    incorporation or organization)

(I.R.S. Employer Identification No.)Bank of America Corporate Center
    100 N. Tryon Street
    Charlotte, North Carolina

28255(Address of principal executive offices)

(Zip Code)(704)
    386-5681Registrants telephone number, including area code:   Securities registered pursuant to Section 12(b) of the
    Act:Title of Each Class

Name of Each Exchange on Which
    RegisteredTrust Preferred Securities of Merrill Lynch Capital
    Trust I (and the guarantee of the registrant with respect
    thereto); Trust Preferred Securities of Merrill Lynch
    Capital Trust II (and the guarantee of the registrant with
    respect thereto); Trust Preferred Securities of Merrill
    Lynch Capital Trust III (and the guarantee of the
    registrant with respect thereto)

New York Stock ExchangeConvertible Securities Exchangeable into Pharmaceutical HOLDRs
    due September 7, 2010

NYSE Alternext US LLC     Securities registered pursuant
    to Section 12(g) of the Act: None
     X YES           NO
    YES      X     NO
    X YES           NO
  Regulation S-T
  YES           NO
  Regulation S-K Form 10-K Form 10-K. X
  12b-2
  Large
    accelerated filer
    Accelerated filer
    Non-accelerated
    filer  X
    Smaller reporting company (Do not check if a smaller
    reporting company)
  Rule 12b-2
  YES      X     NO
       The registrant is a wholly owned subsidiary of Bank of
    America Corporation and meets the conditions set forth in
    General Instructions I(1)(a) and (b) of
    Form 10-K
    and is therefore filing this Form with a reduced disclosure
    format as permitted by Instruction I (2).




---



##### Table of Contents





Securities
    registered pursuant to Section 12(b) of the Act and listed
    on the NYSE Arca are as follows:
 Accelerated Return Bear Market Notes
 ®
 ®
 Accelerated Return
    Notes®
 ®
  ® ®
 ®
 Bear Market Strategic Accelerated
    Redemption Securities ®
 ® ®
 ® ®
 Callable Stock Return Income Debt
    Securities®

    (STRIDES®)
     Capped Leveraged Index Return
    Notes®
 sm
 ®
 sm
 ®
 ®
 ®
 ®
 Strategic Accelerated
    Redemption Securities®
 ®
 sm
 ®
 ®
 ®
 sm
 ®
 sm
 ®
 ® ® ®
 Market Index Target-Term
    Securities®

    (MITTS®)
 ®
 SM
 Monthly Income Strategic Return
    Notes®
 ® ®
 ® ®
 ® ®
 Strategic Return
    Notes®
         ®
  ®
 i




---



##### Table of Contents



Securities
    registered pursuant to Section 12(b) of the Act and listed
    on The NASDAQ Stock Market are as follows:
 MITTS
 ®
 ®
 ®
 ®
 ®
 ®
 SM
 97% Protected Notes
 SM
  Strategic Return Notes
    ii




---



##### Table of Contents



ANNUAL
    REPORT ON
    FORM 10-K
    FOR THE YEAR ENDED DECEMBER 31, 2009
    TABLE OF CONTENTS
   Part IItem 1.  Business


3Item 1A. Risk Factors


4Item 1B. Unresolved Staff Comments


12Item 2.  Properties


12Item 3.  Legal
    proceedings


12Item 4.  Reserved


12Part IIItem 5.  Market for
    Registrants Common Equity, Related Stockholder Matters and
    Issuer Purchases of Equity Securities


13Item 6.  Selected Financial
    Data


13Item 7.  Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations


14Introduction


14Executive Overview


16Results of Operations


18Off-Balance Sheet Exposures


25Funding and Liquidity


27Item 7A. Quantitative and Qualitative
    Disclosures about Market Risk


30Item 8.  Financial Statements
    and Supplementary Data


33Report of Independent Registered Public
    Accounting Firm


33Consolidated Financial StatementsConsolidated Statements of Earnings/(Loss)


35Consolidated Balance Sheets


36Consolidated Statements of Changes in
    Stockholders Equity


38Consolidated Statements of Comprehensive
    Income/(Loss)


40Consolidated Statements of Cash Flows


41Notes to Consolidated Financial
    Statements


42Note 1.Summary of Significant
    Accounting Policies


42Note 2.Acquisition and Subsequent
    Transactions with Bank of America Corporation


59Note 3.Segment and Geographic
    Information


61Note 4.Fair Value Disclosures


63Note 5.Fair Value of Financial
    Instruments


81Note 6.Derivatives


83Note 7.Securities Financing
    Transactions


92Note 8.Investment Securities


94Note 9.Securitization Transactions
    and Transactions with Variable Interest Entities
    (VIEs)


98Note 10.Loans, Notes, Mortgages and
    Related Commitments to Extend Credit


106Note 11.Goodwill and Intangibles


111Note 12.Borrowings and Deposits


113Note 13.Stockholders Equity
    and Earnings Per Share


117Note 14.Commitments, Contingencies
    and Guarantees


121Note 15.Employee Benefit Plans


134Note 16.Employee Incentive Plans


142Note 17.Income Taxes


148Note 18.Regulatory Requirements


153Note 19.Discontinued Operations


154Note 20.Restructuring Charge


155Note 21.Related Party
    Transactions


156Note 22.Quarterly Information
    (Unaudited)


156Note 23.Parent Company
    Information


158Item 9.  Changes in and
    Disagreements with Accountants on Accounting and Financial
    Disclosure


161Item 9A. Controls and Procedures


161Item 9B. Other Information


163 1




---



##### Table of Contents



Part IIIItem 10.  Directors, Executive
    Officers and Corporate Governance


163Item 11.  Executive
    Compensation


163Item 12.  Security Ownership of
    Certain Beneficial Owners and Management and related Stockholder
    Matters


163Item 13.  Certain Relationships
    and Related Transactions, and Director Independence


163Item 14.  Principal Accountant
    Fees and Services


163Part IVItem 15.  Exhibits and
    Financial Statement Schedules


165Signatures


166EX-2.2EX-2.3EX-12EX-23.1EX-23.2EX-23.3EX-24.1EX-24.2EX-31.1EX-31.2EX-32.1EX-32.2   2




---



##### Table of Contents



PART I  Item 1.
    Business      Form 10-K Form 10-K.
  Segment Reporting
    Capital Markets and Advisory Activities.
    Wealth and Investment Management
    Activities.
  Research.
  Regulation
  non-U.S. government
 3




---



##### Table of Contents



United
    States Regulatory Oversight and Supervision
  Holding
    Company Supervision
    Broker-Dealer
    Regulation
    Rule 15c3-1 Form 10-K.
  Non-U.S.
    Regulatory Oversight and Supervision
  non-U.S. regulators and/or
  Item 1A.
    Risk
    Factors    Our businesses and earnings have been, and may continue to
    be, negatively affected by adverse business and economic
    conditions.
 4




---



##### Table of Contents



Adverse changes in legislative and regulatory initiatives may
    significantly impact our earnings, operations and ability to
    pursue business opportunities.
         5




---



##### Table of Contents



We could suffer losses as a result of the actions of or
    deterioration in the commercial soundness of other financial
    services institutions and counterparties, including as a result
    of derivatives transactions.
   6




---



##### Table of Contents



Changes in accounting standards or inaccurate estimates or
    assumptions in the application of accounting policies could
    adversely affect our financial results.
      Our ability to attract and retain clients and employees could
    be adversely affected to the extent our reputation is
    harmed.
  We face substantial potential legal liability and significant
    regulatory action, which could have materially adverse financial
    consequences or cause significant reputational harm to
    us.
 7




---



##### Table of Contents



Our liquidity could be impaired by an inability of Bank of
    America to access the capital markets on favorable
    terms.
      Changes in financial or capital market conditions could cause
    our earnings and the value of our assets to
    decline.
 8




---



##### Table of Contents



Our increased credit risk could result in higher credit
    losses and reduced earnings.
     9




---



##### Table of Contents



Our ability to successfully identify and manage our
    compliance and other risks is an important factor that can
    significantly impact our results.
  We may be unable to compete successfully as a result of the
    evolving financial services industry and market
    conditions.
    We may be adversely impacted by business, economic and
    political conditions in the
    non-U.S. jurisdictions
    in which we operate. non-U.S. jurisdictions, non-U.S. jurisdictions
 10




---



##### Table of Contents



non-U.S. jurisdictions non-U.S. jurisdictions
    non-U.S. jurisdictions, non-U.S. securities non-U.S. trading
  and/or
  Changes in governmental fiscal and monetary policy could
    adversely affect our business. non-U.S. governments
  We may suffer losses as a result of operational risk or
    technical system failures. day-to-day
    Our dependence upon funds from our subsidiaries and our
    parent could adversely impact our
    liquidity.
 11




---



##### Table of Contents



Item 1B.
    Unresolved
    Staff Comments    Item 2.
    Properties    Principal
    Facilities in the United States
    54-acre
  Principal
    Facilities Outside the United States
    Item 3.
    Legal
    Proceedings    Item 4.
    Reserved. 12




---



##### Table of Contents



PART II  Item 5.
    Market
    for Registrants Common Equity, Related Stockholder Matters
    and Issuer Purchases of Equity Securities.    Dividends
    Per Common Share
    First

Second

Third

Fourth(Declared and Paid)

Quarter

Quarter

Quarter

Quarter2009


N/A



N/A



N/A



N/A2008

$
0.35


$
0.35


$
0.35


$
0.35     Securities
    Authorized for Issuance under Equity Compensation
    Plans
    Item 6.
    Selected
    Financial Data.   13




---



##### Table of Contents



Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations  Forward-Looking
    Statements and Non-GAAP Financial Measures
  Form 10-K. Form 10-K, Form 10-Q Form 8-K.
  period-to-period
 Introduction    Bank of
    America Acquisition and Basis of Presentation
   14




---



##### Table of Contents



Form 10-K
    Segment Reporting
  Form 10-K Form 10-K.
 15




---



##### Table of Contents



Executive
    Overview  Company
    Results
      other-than-temporary
    Transactions
    with Bank of America
  Asset and
    Liability Transfers
   16




---



##### Table of Contents



Sale of
    U.S. Banks to Bank of America
        Acquisition
    of Banc of America Investment Services, Inc. (BAI)
    from Bank of America
  805-10, Business Combinations
  Other
    Events
     17




---



##### Table of Contents



Results
    Of Operations (dollars in millions, except per share amounts)% Change between theSuccessor Company


Predecessor
    Company(2)


Year EndedYear Ended


Year Ended


Dec. 31, 2009 and the YearDec. 31, 2009


Dec. 26, 2008


Ended Dec. 26, 2008RevenuesPrincipal transactions

$
3,953



$
(27,225
)



N/M
%Commissions


5,885




6,895




(15
)Managed account and other fee-based revenues


4,315




5,544




(22
)Investment banking


3,573




3,733




(4
)Earnings from equity method investments


1,686




4,491




(62
)Other(1)


3,242




(10,065
)



N/MSubtotal


22,654




(16,627
)



N/MInterest and dividend revenues


11,405




33,383




(66
)Less interest expense


10,773




29,349




(63
)Net interest profit


632




4,034




(84
)Revenues, net of interest expense


23,286




(12,593
)



N/MNon-interest expenses:Compensation and benefits


12,040




14,763




(18
)Communications and technology


1,918




2,201




(13
)Occupancy and related depreciation


1,189




1,267




(6
)Brokerage, clearing, and exchange fees


1,046




1,394




(25
)Advertising and market development


363




652




(44
)Professional fees


607




1,058




(43
)Office supplies and postage


161




215




(25
)Other


2,064




2,402




(14
)Payment related to price reset on common stock offering


-




2,500




N/MGoodwill impairment charge


-




2,300




N/MRestructuring charge


-




486




N/MTotal non-interest expenses


19,388




29,238




(34
)Pre-tax earnings/(loss) from continuing operations


3,898




(41,831
)



N/MIncome tax benefit


(838
)



(14,280
)



N/MNet earnings/(loss) from continuing operations


4,736




(27,551
)



N/MDiscontinued operations:Pre-tax loss from discontinued operations


-




(141
)



N/MIncome tax benefit


-




(80
)



N/MNet loss from discontinued operations


-




(61
)



N/MNet earnings/(loss)

$
4,736



$
(27,612
)



N/MPreferred stock dividends


153




2,869




N/MNet earnings/(loss) applicable to common stockholders

$
4,583



$
(30,481
)



N/MBasic loss per common share from continuing operations


N/A



$
(24.82
)



N/MBasic loss per common share from discontinued operations


N/A




(0.05
)



N/MBasic loss per common share


N/A



$
(24.87
)



N/MDiluted loss per common share from continuing operations


N/A



$
(24.82
)



N/MDiluted loss per common share from discontinued operations


N/A




(0.05
)



N/MDiluted loss per common share


N/A



$
(24.87
)



N/MBook value per share


N/A



$
7.12




N/M   (1)
    
    Successor Company amounts
    include other income and
    other-than-temporary
    impairment losses on
    available-for-sale
    debt securities. The
    other-than-temporary
    impairment losses were $656 million for the year ended
    December 31, 2009.(2)
    
    Does not include results for the
    period from December 27, 2008 to December 31, 2008,
    which are presented separately on the Consolidated Statements of
    Earnings/(Loss). N/M = Not meaningful.
 N/A = Earnings per share information is not applicable to the
    Successor Company period since Merrill Lynch is now a
    wholly-owned subsidiary of Bank of America.
 18




---



##### Table of Contents



Consolidated
    Results of Operations
    2009
    Compared With 2008
     19




---



##### Table of Contents



year-over-year
  available-for-sale other-than-temporary available-for-sale
   20




---



##### Table of Contents



21




---



##### Table of Contents



U.S. ABS
    CDO and Other Mortgage-Related Activities
    Residential
    Mortgage, U.S. Super Senior ABS CDO and Commercial
    Mortgage-Related Activities (excluding the Investment Securities
    Portfolio)
  Investment Securities
    Portfolio
  (dollars in millions)Successor Company


Predecessor CompanyNet


Netexposures as


exposures asof Dec. 31,


of Dec. 26,2009


2008(Excluding the investment securities portfolio)Residential Mortgage-RelatedU.S.
    Prime(1)

$
770



$
34,799Other Residential:U.S.
    Sub-prime

$
(312
)


$
195U.S. Alt-A


(9
)



27Non-U.S.


2,903




3,380Total Other
    Residential(2)

$
2,582



$
3,602U.S. Super Senior ABS CDO

$
110



$
708Commercial Real Estate:Whole Loans/Conduits

$
3,282



$
3,845Securities and Derivatives


(593
)



174Real Estate
    Investments(3)


3,571




5,685Total Commercial Real Estate, excluding First Republic
    Bank

$
6,260



$
9,704First Republic Bank, Commercial Real
    Estate(4)

$
-



$
3,119  (1)
    
    As of December 31, 2009,
    net exposures primarily consisted of prime loans originated with
    clients of our global wealth management business. The decrease
    in U.S. Prime exposure from December 26, 2008 was primarily
    due to the sale of MLBUSA and MLBT-FSB to Bank of America during
    2009.(2)
    
    Includes warehouse lending,
    whole loans and residential mortgage-backed
    securities.(3)
    
    Merrill Lynch makes debt and
    equity investments in entities whose underlying assets are real
    estate. The amounts presented are net investments and therefore
    exclude the amounts that have been consolidated but for which
    Merrill Lynch does not consider itself to have economic
    exposure.(4)
    
    First Republic Bank was
    included in the sale of MLBT-FSB to Bank of America during
    2009.  U.S. ABS
    CDO Activities
   22




---



##### Table of Contents



Monoline
    Financial Guarantors
  and/or
  and/or
        (dollars in millions)Mark-to-Market Prior

Life-to-DateCredit Default Swaps with
    Financial





to Credit

CreditGuarantors (Excluding U.S. Super Senior

Notional of

Net

Valuation

Valuation

CarryingABS CDO)

CDS(1)

Exposure(2)

Adjustments

Adjustments

Value(4)By counterparty credit
    quality(3)AAA

$
(11,875
)

$
(10,020
)

$
1,855


$
(61
)

$
1,794Non-investment grade or unrated


(21,385
)


(15,124
)


6,261



(4,016
)


2,245Total financial guarantor exposures

$
(33,260
)

$
(25,144
)

$
8,116


$
(4,077
)

$
4,039  (1)
    
    Represents the gross notional
    amount of CDS purchased as protection to hedge predominantly
    Corporate CDOs, CLOs, RMBS and CMBS exposure. Amounts do not
    include exposure to financial guarantors on U.S. super senior
    ABS CDOs, which are reported separately above.(2)
    
    Represents the notional of the
    total CDS, net of gains prior to credit valuation
    adjustments.(3)
    
    Represents Standard &
    Poors Ratings Services rating band as of December 31,
    2009.(4)
    
    The total carrying value as of
    December 26, 2008 was $7.8 billion. The decrease in
    carrying value from December 26, 2008 primarily reflected a
    $3.7 billion decrease in CLOs, corporate CDOs, CMBS and
    RMBS carrying value. 23




---



##### Table of Contents



Investment
    Securities Portfolio
  other-than-temporary.
  other-than-temporary
  
    The period of time over which it is estimated that the fair
    value will increase from the current level to at least the
    amortized cost level, or until principal and interest is
    estimated to be received;
    The period of time a securitys fair value has been below
    amortized cost;
    The amount by which the securitys fair value is below
    amortized cost;
    The financial condition of the issuer; and
    Managements intention to sell the security or if it is
    more likely than not that Merrill Lynch will be required to sell
    the security before the recovery of its amortized cost.      (dollars in millions)Predecessor









SuccessorCompany -









Company -Net

Sale of

Net gains

Unrealized



Netexposures as

MLBUSA

reported

gains/(losses)

Other net

exposures asof Dec. 26,

and

in

included in

changes in net

of Dec, 31,2008

MLBT-FSB

income

OCI (pre-tax)

exposures(1)

2009Investment Securities Portfolio:Sub-prime
    residential mortgage-backed securities

$
2,013


$
(12
)

$
50


$
166


$
(1,328
)

$
889Alt-A residential mortgage-backed securities


2,295



(264
)


55



490



(2,252
)


324Commercial mortgage-backed securities


3,125



(1,491
)


149



109



(1,892
)


-Prime residential mortgage-backed securities


1,845



(140
)


22



180



(1,593
)


314Non-residential asset-backed securities


626



(276
)


57



(4
)


(403
)


-Non-residential CDOs


329



(16
)


4



(1
)


(293
)


23Other


198



(95
)


8



(10
)


(101
)


-Total

$
10,431


$
(2,294
)

$
345


$
930


$
(7,862
)

$
1,550  (1)
    
    Primarily represents sales and
    principal paydowns. 24




---



##### Table of Contents



Off-Balance
    Sheet Exposures     (dollars in millions)ExpirationLess than

1 - 3

3 - 5

Over 5Total

1 Year

Years

Years

YearsStandby liquidity facilities

$
4,906


$
2,124


$
-


$
2,750


$
32Auction rate security guarantees


198



198



-



-



-Residual value guarantees


416



-



96



320



-Standby letters of credit and other guarantees


26,645



894



156



71



25,524   Standby
    Liquidity Facilities
    Auction
    Rate Security Guarantees
  not-for-profit,
  Residual
    Value Guarantees
    Standby
    Letters of Credit and Other Guarantees
   25




---



##### Table of Contents



Derivatives
    Involvement
    with SPEs
    
    Municipal bond securitization SPEs: SPEs that issue
    medium-term paper, purchase municipal bonds as collateral and
    purchase a guarantee to enhance the creditworthiness of the
    collateral.
    Asset-backed securities SPEs: SPEs that issue
    different classes of debt, from super senior to subordinated,
    and equity and purchase assets as collateral, including
    residential mortgages, commercial mortgages, auto leases and
    credit card receivables.
    ABS CDOs: SPEs that issue different classes of debt,
    from super senior to subordinated, and equity and purchase
    asset-backed securities collateralized by residential mortgages,
    commercial mortgages, auto leases and credit card receivables.
    Synthetic CDOs: SPEs that issue different classes of
    debt, from super senior to subordinated, and equity, purchase
    high-grade assets as collateral and enter into a portfolio of
    credit default swaps to synthetically create the credit risk of
    the issued debt. 26




---



##### Table of Contents




    Credit-linked note SPEs: SPEs that issue notes
    linked to the credit risk of a company, purchase high-grade
    assets as collateral and enter into credit default swaps to
    synthetically create the credit risk to pay the return on the
    notes.
    Tax planning SPEs: SPEs are sometimes used to
    legally isolate transactions for the purpose of obtaining a
    particular tax treatment for our clients as well as ourselves.
    The assets and capital structure of these entities vary for each
    structure.
    Trust preferred security SPEs: These SPEs hold
    junior subordinated debt issued by ML & Co. or our
    subsidiaries, and issue preferred stock on substantially the
    same terms as the junior subordinated debt to third party
    investors. We also provide a parent guarantee, on a junior
    subordinated basis, of the distributions and other payments on
    the preferred stock to the extent that the SPEs have funds
    legally available. The debt we issue into the SPE is classified
    as long-term borrowings on our Consolidated Balance Sheets. The
    ML & Co. parent guarantees of its own subsidiaries are
    not required to be recorded in the Consolidated Financial
    Statements.
    Conduits: Generally, entities that issue commercial
    paper and subordinated capital, purchase assets, and enter into
    total return swaps or repurchase agreements with higher-rated
    counterparties, particularly banks. The Conduits generally have
    a liquidity
    and/or
    credit facility to further enhance the credit quality of the
    commercial paper issuance. A single seller conduit will execute
    total return swaps, repurchase agreements, and liquidity and
    credit facilities with one financial institution. A multi-seller
    Conduit will execute total return swaps, repurchase agreements,
    and liquidity and credit facilities with numerous financial
    institutions.    
    Holder of Issued Debt and Equity: Merrill Lynch
    invests in debt of third party securitization vehicles that are
    SPEs and also invests in SPEs that we establish. In Merrill
    Lynch formed SPEs, we may be the holder of debt and equity of an
    SPE. These holdings will be classified as trading assets, loans,
    notes and mortgages or investment securities. Such holdings may
    change over time at our discretion and rarely are there
    contractual obligations that require us to purchase additional
    debt or equity interests. Significant obligations are disclosed
    in the off-balance sheet arrangements table above.
    Warehousing of Loans and Securities: Warehouse loans
    and securities represent amounts maintained on our balance sheet
    that are intended to be sold into a trust for the purposes of
    securitization. We may retain these loans and securities on our
    balance sheet for the benefit of a CDO managed by a third party.
    Warehoused loans are carried as held for sale and warehoused
    securities are carried as trading assets.
    Securitizations: In the normal course of business,
    we securitize: commercial and residential mortgage loans;
    municipal, government, and corporate bonds; and other types of
    financial assets. Securitizations involve the selling of assets
    to SPEs, which in turn issue debt and equity securities with
    those assets as collateral. We may retain interests in the
    securitized financial assets through holding issuances of the
    securitization. See Note 9 to the Consolidated Financial
    Statements. Funding and
    Liquidity  Funding
   27




---



##### Table of Contents



Credit
    Ratings
        Senior

Subordinated

Trust

Commercial

Long-Term DebtDebt

Debt

Preferred

Paper

RatingsRating Agency

Ratings

Ratings

Ratings

Ratings

OutlookDominion Bond Rating Service Ltd.

A

A (low)

A (low)

R-1 (middle)

StableFitch Ratings

A+

A

BB

F1+

StableMoodys Investors Service, Inc.

A2

A3

Baa3

P-1

StableRating & Investment Information, Inc. (Japan)

A+

A

Not rated

a-1

NegativeStandard & Poors Ratings Services

A

A-

BB

A-1

Negative   and/or
 28




---



##### Table of Contents



Liquidity
    Risk
    Unencumbered
    Loans and Securities
      Committed
    Credit Facilities
    U.S.
    Government Liquidity Facilities
   29




---



##### Table of Contents



Item 7A.
    Quantitative
    and Qualitative Disclosures About Market Risk  Market
    Risk Management
    Control
    and Governance Structure
        Value-at-Risk
    (VaR)
  Value-at-Risk
       30




---



##### Table of Contents



2009
    Trading Activities Market Risk VaR
  (dollars in millions)20092009

Daily

2009

2009

2008Year End

Average

High

Low

Year
    End(3)Trading
    value-at-risk(1)Foreign exchange

$
36


$
18


$
56


$
2


$
17Interest rate


45



49



69



30



42Credit


171



130



277



73



271Real estate/Mortgage


56



37



57



24



40Commodities


21



20



29



16



22Equities


58



43



77



22



47Subtotal(2)


387



297











439Diversification benefit


(205
)


(159
)










(230
)Overall

$
182


$
138










$
209  (1)
    
    Based on a 99% confidence level
    and a
    one-day
    holding period.(2)
    
    Subtotals are not provided for
    highs and lows as they are not meaningful.(3)
    
    Represents VaR calculated as of
    January 1, 2009.  Form 10-K.
  VaR
    Backtesting
    Non-Trading
    Market Risk
     31




---



##### Table of Contents



year-over-year Form 10-K.
  Counterparty
    Credit Risk
    non-U.S. portfolio,
  and/or
  Derivatives
     32




---



##### Table of Contents



Item 8.
    Financial
    Statements and Supplementary Data REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM           New York, New York
 February 26, 2010
 33




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
                  34




---



##### Table of Contents



Merrill
    Lynch & Co., Inc. and SubsidiariesConsolidated Statements of
    Earnings/(Loss)  Successor Company


Predecessor CompanyFor the Period fromFor the Year Ended


December 27, 2008 to

For the Year Ended

For the Year Ended(dollars in millions, except per share amounts)

December 31, 2009


December 31, 2008

December 26, 2008

December 28, 2007RevenuesPrincipal transactions

$
3,953



$
(280
)

$
(27,225
)

$
(12,067
)Commissions


5,885




22



6,895



7,284Managed accounts and other fee-based revenues


4,315




22



5,544



5,465Investment banking


3,573




12



3,733



5,582Earnings from equity method investments


1,686




-



4,491



1,627Other income/(loss)


3,898




19



(10,065
)


(2,190
)Other-than-temporary
    impairment losses on AFS debt securities:Total
    other-than-temporary
    impairment losses on AFS debt securities


(660
)



-



-



-Portion of
    other-than-temporary
    impairment losses recognized in OCI on AFS debt securities


4




-



-



-Subtotal


22,654




(205
)


(16,627
)


5,701Interest and dividend revenues


11,405




34



33,383



56,974Less interest expense


10,773




-



29,349



51,425Net interest profit


632




34



4,034



5,549Revenues, net of interest expense


23,286




(171
)


(12,593
)


11,250Non-interest expensesCompensation and benefits


12,040




64



14,763



15,903Communications and technology


1,918




-



2,201



2,057Occupancy and related depreciation


1,189




-



1,267



1,139Brokerage, clearing, and exchange fees


1,046




10



1,394



1,415Advertising and market development


363




-



652



785Professional fees


607




-



1,058



1,027Office supplies and postage


161




-



215



233Other


2,064




-



2,402



1,522Payment related to price reset on common stock offering


-




-



2,500



-Goodwill impairment charge


-




-



2,300



-Restructuring charge


-




-



486



-Total non-interest expenses


19,388




74



29,238



24,081Pre-tax earnings/(loss) from continuing operations


3,898




(245
)


(41,831
)


(12,831
)Income tax benefit


(838
)



(92
)


(14,280
)


(4,194
)Net earnings/(loss) from continuing operations


4,736




(153
)


(27,551
)


(8,637
)Discontinued operations:Pre-tax (loss)/earnings from discontinued operations


-




-



(141
)


1,397Income tax (benefit)/expense


-




-



(80
)


537Net (loss)/earnings from discontinued operations


-




-



(61
)


860Net earnings/(loss)

$
4,736



$
(153
)

$
(27,612
)

$
(7,777
)Preferred stock dividends


153




-



2,869



270Net earnings/(loss) applicable to common stockholders

$
4,583



$
(153
)

$
(30,481
)

$
(8,047
)Basic loss per common share from continuing operations


N/A



$
(0.10
)

$
(24.82
)

$
(10.73
)Basic (loss)/earnings per common share from discontinued
    operations


N/A




-



(0.05
)


1.04Basic loss per common share


N/A



$
(0.10
)

$
(24.87
)

$
(9.69
)Diluted loss per common share from continuing operations


N/A



$
(0.10
)

$
(24.82
)

$
(10.73
)Diluted (loss)/earnings per common share from discontinued
    operations


N/A




-



(0.05
)


1.04Diluted loss per common share


N/A



$
(0.10
)

$
(24.87
)

$
(9.69
)Dividend paid per common share


N/A



$
-


$
1.40


$
1.40Average shares used in computing lossesBasic


N/A




1,600.3



1,225.6



830.4Diluted


N/A




1,600.3



1,225.6



830.4    See Notes to Consolidated
    Financial Statements.
 35




---



##### Table of Contents



Merrill
    Lynch & Co., Inc. and SubsidiariesConsolidated Balance Sheets  Successor Company


Predecessor CompanyDecember 31,


December 26,(dollars in millions, except
    per share amounts)

2009


2008ASSETSCash and cash equivalents

$
15,005



$
68,403Cash and securities segregated for regulatory purposes or
    deposited with clearing organizations


20,430




32,923Securities financing transactionsReceivables under resale agreements (includes $41,740 in 2009
    and $62,146 in 2008 measured at fair value in accordance with
    the fair value option election)


69,738




93,247Receivables under securities borrowed transactions (includes
    $2,888 in 2009 and $853 in 2008 measured at fair value in
    accordance with the fair value option election)


45,422




35,077115,160




128,324Trading assets, at fair value (includes securities
    pledged as collateral that can be sold or repledged of $25,901
    in 2009 and $18,663 in 2008):Derivative contracts


49,582




89,477Equities and convertible debentures


34,501




26,160Non-U.S.
    governments and agencies


21,256




6,107Corporate debt and preferred stock


16,779




30,829Mortgages, mortgage-backed, and asset-backed


7,971




13,786U.S. Government and agencies


1,458




5,253Municipals, money markets and physical commodities


8,778




3,993140,325




175,605Investment securities (includes $253 in 2009 and $2,770
    in 2008 measured at fair value in accordance with the fair value
    option election) (includes securities pledged as collateral that
    can be sold or repledged of $0 in 2009 and $2,557 in 2008)


32,840




57,007Securities received as collateral, at fair value


16,346




11,658Receivables from Bank of America


20,619




-Other receivablesCustomers (net of allowance for doubtful accounts of $10 in 2009
    and $143 in 2008)


31,818




51,131Brokers and dealers


5,998




12,410Interest and other


14,251




26,33152,067




89,872Loans, notes, and mortgages (net of allowances for loan
    losses of $33 in 2009 and $2,072 in 2008) (includes $4,649 in
    2009 and $979 in 2008 measured at fair value in accordance with
    the fair value option election)


37,663




69,190Equipment and facilities (net of accumulated depreciation
    and amortization of $726 in 2009 and $5,856 in 2008)


2,324




2,928Goodwill and other intangible assets


8,883




2,616Other assets


17,533




29,017Total Assets

$
479,195



$
667,543  36




---



##### Table of Contents



Merrill
    Lynch & Co., Inc. and SubsidiariesConsolidated Balance Sheets
  Successor Company


Predecessor CompanyDecember 31,


December 26,(dollars in millions, except per
    share amounts)

2009


2008LIABILITIESSecurities financing transactionsPayables under repurchase agreements (includes $37,325 in 2009
    and $32,910 in 2008 measured at fair value in accordance with
    the fair value option election)

$
66,260



$
92,654Payables under securities loaned transactions


24,915




24,42691,175




117,080Short-term borrowings (includes $813 in 2009 and $3,387
    in 2008 measured at fair value in accordance with the fair value
    option election)


853




37,895Deposits


15,187




96,107Trading liabilities, at fair valueDerivative contracts


35,120




71,363Equities and convertible debentures


13,654




7,871Non-U.S.
    governments and agencies


12,844




4,345Corporate debt and preferred stock


1,903




1,318U.S. Government and agencies


1,296




3,463Municipals, money markets and other


643




1,11165,460




89,471Obligation to return securities received as collateral, at
    fair value


16,346




11,658Payables to Bank of America


23,550




-Other payablesCustomers


39,307




44,924Brokers and dealers


14,148




12,553Interest and other (includes $240 in 2009 measured at fair value
    in accordance with the fair value option election)


17,080




32,91870,535




90,395Long-term borrowings (includes $47,040 in 2009 and
    $49,521 in 2008 measured at fair value in accordance with the
    fair value option election)


151,399




199,678Junior subordinated notes(related to trust preferred
    securities)


3,552




5,256Total Liabilities


438,057




647,540COMMITMENTS AND CONTINGENCIESSTOCKHOLDERS EQUITYPreferred Stockholders Equity;authorized
    25,000,000 shares;(liquidation preference of $30,000 per share; issued:
    2008  244,100 shares; liquidation preference of
    $1,000 per share; issued: 2008  115,000 shares;
    liquidation preference of $100,000 per share; issued:
    2009  17,000 shares; issued: 2008 
    17,000 shares)


1,541




8,605Common Stockholders EquityCommon stock (par value
    $1.331/3
    per share; authorized: 3,000,000,000 shares; issued:
    2009  1,000 shares; issued: 2008 
    2,031,995,436 shares)


-




2,709Paid-in capital


35,126




47,232Accumulated other comprehensive (loss) (net of tax)


(112
)



(6,318
)Retained earnings/(Accumulated deficit)


4,583




(8,603
)39,597




35,020Less: Treasury stock, at cost (2009  None;
    2008  431,742,565 shares)


-




23,622Total Common Stockholders Equity


39,597




11,398Total Stockholders Equity


41,138




20,003Total Liabilities and Stockholders Equity

$
479,195



$
667,543    See Notes to Consolidated
    Financial Statements.
 37




---



##### Table of Contents



Merrill
    Lynch & Co., Inc. and SubsidiariesConsolidated Statements of Changes in
    Stockholders Equity  Successor CompanyAmounts

SharesFor the Year Ended

For the Year Ended(dollars in millions)

December 31, 2009

December 31, 2009Preferred Stock, netBalance, beginning of year

$
8,605



363,445Effect of BAC acquisition


(7,064
)


(346,445
)Balance, end of year

$
1,541



17,000Common Stockholders EquityShares Exchangeable into Common StockBalance, beginning of year

$
-



8,189Effect of BAC acquisition






(8,189
)Balance, end of year


-



-Common StockBalance, beginning of year


2,709



2,031,995,436Effect of BAC acquisition


(2,709
)


(2,031,994,436
)Balance, end of year


-



1,000Paid-in CapitalBalance, beginning of year


47,232Effect of Purchase Accounting Adjustments


(19,669
)Cash Capital Contribution from BAC


6,850BAC contribution of BAI


263Capital contribution associated with amortization of employee
    stock grants


450Balance, end of year


35,126Accumulated Other Comprehensive LossForeign Currency Translation Adjustment (net of tax)Balance, beginning of year


(745
)Effect of BAC acquisition


745Translation adjustment


94Balance, end of year


94Net Unrealized Gains (Losses) on Investment SecuritiesAvailable-for-Sale
    (net of tax)Balance, beginning of year


(6,038
)Effect of BAC acquisition


6,038Net unrealized gains on
    available-for-sale
    securities


47Balance, end of year


47Deferred Gains (losses) on Cash Flow Hedges (net of tax)Balance, beginning of year


81Effect of BAC acquisition


(81
)Balance, end of year


-Defined benefit pension and postretirement plans (net of tax)Balance, beginning of year


384Effect of BAC acquisition


(384
)Decrease in funded status


(253
)Balance, end of year


(253
)Balance, end of year


(112
)Retained EarningsBalance, beginning of year


(8,756
)Effect of BAC acquisition


8,756Net earnings


4,736Preferred stock dividends declared


(153
)Balance, end of year


4,583Treasury Stock, at costBalance, beginning of year


(23,622
)


(431,742,565
)Effect of BAC acquisition


23,622



431,742,565Balance, end of year


-



-Total Common Stockholders Equity

$
39,597Total Stockholders Equity

$
41,138    See Notes to Consolidated
    Financial Statements.
 38




---



##### Table of Contents



Merrill
    Lynch & Co., Inc. and SubsidiariesConsolidated Statements of Changes in
    Stockholders Equity
  Predecessor CompanyAmounts

SharesFor the Period from





For the Period fromDecember 26,





December 26,2008 to

For the Year Ended

For the Year Ended

2008 to

For the Year Ended

For the Year EndedDecember 31,

December 26,

December 28,

December 31,

December 26,

December 28,(dollars in millions)

2008

2008

2007

2008

2008

2007Preferred Stock, netBalance, beginning of year

$
8,605


$
4,383


$
3,145



363,445



257,134



104,928Issuances


-



10,814



1,615



-



172,100



165,000Redemptions


-



(6,600
)


-



-



(66,000
)


-Shares (repurchased) re-issuances


-



8



(377
)


-



211



(12,794
)Balance, end of year

$
8,605


$
8,605


$
4,383



363,445



363,445



257,134Common Stockholders EquityShares Exchangeable into Common StockBalance, beginning of year

$
-


$
39


$
39



8,189



2,552,982



2,659,926Exchanges


-



(39
)


-



-



(2,544,793
)


(106,944
)Balance, end of year


-



-



39



8,189



8,189



2,552,982Common StockBalance, beginning of year


2,709



1,805



1,620



2,031,995,436



1,354,309,819



1,215,381,006Capital issuance and
    acquisition(1)(2)


-



648



122



-



486,166,666



91,576,096Preferred stock conversion


-



236



-



-



177,322,917



-Shares issued to employees


-



20



63



-



14,196,034



47,352,717Balance, end of year


2,709



2,709



1,805



2,031,995,436



2,031,995,436



1,354,309,819Paid-in CapitalBalance, beginning of year


47,232



27,163



18,919Capital issuance and
    acquisition(1)(2)


-



11,544



4,643Preferred stock conversion


-



6,970



-Employee stock plan activity and other


-



(553
)


1,962Amortization of employee stock grants


-



2,108



1,639Balance, end of year


47,232



47,232



27,163Accumulated Other Comprehensive LossForeign Currency Translation Adjustment (net of tax)Balance, beginning of year


(745
)


(441
)


(430
)Translation adjustment


-



(304
)


(11
)Balance, end of year


(745
)


(745
)


(441
)Net Unrealized Gains/(Losses) on Investment SecuritiesAvailable-for-Sale
    (net of tax)Balance, beginning of year


(6,038
)


(1,509
)


(192
)Net unrealized losses on
    available-for-sale
    securities


-



(7,617
)


(2,460
)Adjustment to initially apply the Fair Value Option
    Election(3)


-



-



172Other
    adjustments(4)


-



3,088



971Balance, end of year


(6,038
)


(6,038
)


(1,509
)Deferred Gains/(Losses) on Cash Flow Hedges (net of tax)Balance, beginning of year


81



83



2Net deferred (losses) gains on cash flow hedges


-



(2
)


81Balance, end of year


81



81



83Defined benefit pension and postretirement plans (net of tax)Balance, beginning of year


384



76



(164
)Net gains


-



306



240Adjustment to apply Compensation  Retirement Benefits
    change in measurement
    date(3)


-



2



-Balance, end of year


384



384



76Balance, end of year


(6,318
)


(6,318
)


(1,791
)Retained EarningsBalance, beginning of year


(8,603
)


23,737



33,217Net losses


(153
)


(27,612
)


(7,777
)Preferred stock dividends declared


-



(2,869
)


(270
)Common stock dividends declared


-



(1,853
)


(1,235
)Adjustment to initially apply Fair Value Accounting


-



-



53Adjustment to apply Compensation  Retirement Benefits
    change in measurement date


-



(6
)


-Adjustment to initially apply the Fair Value Option Election


-



-



(185
)Adjustment to initially apply Income Tax Accounting


-



-



(66
)Balance, end of year


(8,756
)


(8,603
)


23,737Treasury Stock, at costBalance, beginning of year


(23,622
)


(23,404
)


(17,118
)


(431,742,565
)


(418,270,289
)


(350,697,271
)Shares repurchased


-



-



(5,272
)


-



-



(62,112,876
)Shares reacquired from employees and
    other(5)


-



(363
)


(1,014
)


-



(16,017,069
)


(5,567,086
)Share exchanges


-



145



-



-



2,544,793



106,944Balance, end of year


(23,622
)


(23,622
)


(23,404
)


(431,742,565
)


(431,742,565
)


(418,270,289
)Total Common Stockholders Equity

$
11,245


$
11,398


$
27,549Total Stockholders Equity

$
19,850


$
20,003


$
31,932    (1)
    
    The 2008 activity relates to the
    July 28, 2008 public offering and additional shares issued
    to Davis Selected Advisors and Temasek Holdings.(2)
    
    The 2007 activity relates to the
    acquisition of First Republic Bank and to additional shares
    issued to Davis Selected Advisors and Temasek
    Holdings.(3)
    
    These adjustments are not
    reflected in the 2008 and 2007 Statements of Comprehensive
    Income/(Loss).(4)
    
    Other adjustments in 2008 and
    2007 primarily relate to income taxes, policyholder liabilities
    and deferred policy acquisition costs.(5)
    
    Share amounts are net of
    reacquisitions from employees of 19,057,068 and
    12,490,283 shares in 2008 and 2007, respectively.   See Notes to Consolidated
    Financial Statements.
 39




---



##### Table of Contents



Merrill
    Lynch & Co., Inc. and SubsidiariesConsolidated Statements of Comprehensive
    Income/(Loss)  Successor Company


Predecessor CompanyFor the Period fromDecember 26,For the Year Ended


2008 to

For the Year Ended

For the Year EndedDecember 31,


December 31,

December 26,

December 28,(dollars in millions)

2009


2008

2008

2007Net Earnings/(Loss)

$
4,736



$
(153
)

$
(27,612
)

$
(7,777
)Other Comprehensive Income/(Loss)Foreign currency translation adjustment:Foreign currency translation (losses)/gains


(597
)



-



694



(282
)Income tax benefit/(expense)


691




-



(998
)


271Total


94




-



(304
)


(11
)Net unrealized gains/(losses) on investment securities
    available-for-sale:Net unrealized holding gains/(losses) arising during the period


91




-



(11,916
)


(2,291
)Reclassification adjustment for realized losses/(gains) included
    in net earnings/(loss)


14




-



4,299



(169
)Net unrealized gains/(losses) on investment securities
    available-for-sale:


105




-



(7,617
)


(2,460
)Policyholder liabilities


-




-



-



4Income tax (expense)/benefit


(58
)



-



3,088



967Total


47




-



(4,529
)


(1,489
)Deferred gains/(losses) on cash flow hedges:Deferred gains on cash flow hedges


72




-



240



162Reclassification adjustment for realized gains included in net
    earnings/(loss)


(71
)



-



(241
)


(30
)Income tax expense


(1
)



-



(1
)


(51
)Total


-




-



(2
)


81Defined benefit pension and postretirement plans:Net actuarial (losses)/gains


(417
)



-



489



353Prior service cost


-




-



(4
)


6Reclassification adjustment for realized (gains)/losses included
    in net earnings/(loss)


-




-



(5
)


23Income tax benefit/(expense)


164




-



(174
)


(142
)Total


(253
)



-



306



240Total Other Comprehensive Loss


(112
)



-



(4,529
)


(1,179
)Comprehensive Income/(Loss)

$
4,624



$
(153
)

$
(32,141
)

$
(8,956
)    See Notes to Consolidated
    Financial Statements.
 40




---



##### Table of Contents



Merrill
    Lynch & Co., Inc. and Subsidiaries



Consolidated
    Statements of Cash Flows  Successor Company


Predecessor CompanyFor the Year Ended


For the Year Ended

For the Year EndedDecember 31,


December 26,

December 28,(dollars in millions)

2009


2008

2007Cash flows from operating activities:Net earnings/(loss)

$
4,736



$
(27,612
)

$
(7,777
)Adjustments to reconcile net earnings/(loss) to cash provided by
    (used for) operating activitiesGain on sale of MLIG


-




-



(316
)Depreciation and amortization


1,075




886



901Share-based compensation expense


1,433




2,044



1,795Payment related to price reset on common stock offering


-




2,500



-Goodwill impairment charge


-




2,300



-Deferred taxes


754




(16,086
)


(4,924
)Gain on sale of Bloomberg L.P.


-




(4,296
)


-(Earnings)/loss from equity method investments


(1,443
)



306



(1,409
)Other


(402
)



13,556



160Changes in operating assets and liabilities:Trading assets


29,902




59,064



(29,650
)Cash and securities segregated for regulatory purposes or
    deposited with clearing organizations


3,469




(6,214
)


(8,886
)Receivables from Bank of America


(50,452
)



-



-Receivables under resale agreements


33,971




128,370



(43,247
)Receivables under securities borrowed transactions


(9,781
)



98,063



(14,530
)Customer receivables


1,989




19,561



(21,280
)Brokers and dealers receivables


6,412




10,236



(3,744
)Proceeds from loans, notes, and mortgages held for sale


9,237




21,962



72,054Other changes in loans, notes, and mortgages held for sale


(7,212
)



2,700



(86,894
)Trading liabilities


(24,184
)



(34,338
)


23,878Payables under repurchase agreements


(20,894
)



(143,071
)


13,101Payables under securities loaned transactions


489




(31,480
)


12,414Payables to Bank of America


23,550




-



-Customer payables


(5,625
)



(18,658
)


14,135Brokers and dealers payables


1,625




(11,946
)


113Trading investment securities


-




3,216



9,333Other, net


6,082




(31,588
)


2,411Cash provided by (used for) operating activities


4,731




39,475



(72,362
)Cash flows from investing activities:Proceeds from (payments for):Maturities of
    available-for-sale
    securities


6,989




7,250



13,362Sales of
    available-for-sale
    securities


11,311




29,537



39,327Purchases of
    available-for-sale
    securities


(1,901
)



(31,017
)


(58,325
)Proceeds from the sale of discontinued operations


-




12,576



1,250Equipment and facilities, net


(256
)



(630
)


(719
)Loans, notes, and mortgages held for investment


3,440




(13,379
)


5,113Sale of MLBT-FSB to Bank of America


4,450




-



-Other investments


3,999




1,336



(5,049
)Acquisitions, net of cash


-




-



(2,045
)Cash provided by (used for) investing activities


28,032




5,673



(7,086
)Cash flows from financing activities:Proceeds from (payments for):Commercial paper and short-term borrowings


(36,631
)



12,981



6,316Issuance and resale of long-term borrowings


7,555




70,194



165,107Settlement and repurchases of long-term borrowings


(56,089
)



(109,731
)


(93,258
)Capital contributions from Bank of America


6,850




-



-Deposits


8,088




(7,880
)


9,884Derivative financing transactions


19




543



848Issuance of common stock


-




9,899



4,787Issuance of preferred stock, net


-




9,281



1,123Common stock repurchases


-




-



(5,272
)Other common stock transactions


-




(833
)


(60
)Excess tax benefits related to share-based compensation


-




39



715Dividends


(153
)



(2,584
)


(1,505
)Cash (used for) provided by financing activities


(70,361
)



(18,091
)


88,685(Decrease)/increase in cash and cash equivalents


(37,598
)



27,057



9,237Cash and cash equivalents, beginning of
    period(1)


52,603




41,346



32,109Cash and cash equivalents, end of period

$
15,005



$
68,403


$
41,346Supplemental Disclosure of Cash Flow Information:Income taxes paid (net of refunds)

$
778



$
1,518


$
1,846Interest paid


9,543




30,397



49,881  Non-cash investing and financing activities:
  In connection with the acquisition of Merrill Lynch by Bank
    of America, Merrill Lynch recorded purchase accounting
    adjustments in the year ended December 31, 2009, which were
    recorded as non-cash capital contributions. In addition, during
    2009 Bank of America contributed the net assets of Banc of
    America Investment Services, Inc. to Merrill Lynch. See
    Note 2.
  In connection with the sale of Merrill Lynch Bank USA to a
    subsidiary of Bank of America during 2009, Merrill Lynch
    received a note receivable as consideration for the net book
    value of the assets and liabilities transferred to Bank of
    America. See Note 2.
  As a result of the conversion of $6.6 billion of Merrill
    Lynchs mandatory convertible preferred stock,
    series 1, Merrill Lynch recorded additional preferred
    dividends of $2.1 billion in 2008. The preferred dividends
    were paid in additional shares of common and preferred stock.
  In 2008, in satisfaction of Merrill Lynchs obligations
    under the reset provisions contained in the investment agreement
    with Temasek, Merrill Lynch paid Temasek $2.5 billion
    through the issuance of common stock.
  As a result of the sale of Merrill Lynchs 20% ownership
    stake in Bloomberg, L.P. in 2008, Merrill Lynch recorded a
    $4.3 billion pre-tax gain and received notes totaling
    approximately $4.3 billion.
  (1)
    
    Amount for Successor Company is
    as of January 1, 2009.   See Notes to Consolidated
    Financial Statements.
 41




---



##### Table of Contents



Merrill
    Lynch & Co., Inc. and Subsidiaries
    Notes to Consolidated Financial Statements
    December 31, 2009  Note 1.  Summary of Significant Accounting
    Policies  Description
    of Business
    
    Merrill Lynch, Pierce, Fenner & Smith Incorporated
    (MLPF&S), a
    U.S.-based
    broker-dealer in securities and futures commission merchant;
    Merrill Lynch International (MLI), a United Kingdom
    (U.K.)-based
    broker-dealer in securities and dealer in equity and credit
    derivatives;
    Merrill Lynch Capital Services, Inc., a
    U.S.-based
    dealer in interest rate, currency, commodity and credit
    derivatives;
    Merrill Lynch International Bank Limited (MLIB), an
    Ireland-based bank;
    Merrill Lynch Japan Securities Co., Ltd. (MLJS), a
    Japan-based broker-dealer;
    Merrill Lynch Derivative Products, AG, a Switzerland-based
    derivatives dealer; and
    ML IBK Positions Inc., a
    U.S.-based
    entity involved in private equity and principal investing.    
    Securities brokerage, trading and underwriting;
    Investment banking, strategic advisory services (including
    mergers and acquisitions) and other corporate finance activities;
    Wealth management products and services, including financial,
    retirement and generational planning;
    Investment management and advisory and related record-keeping
    services;
    Origination, brokerage, dealer, and related activities in swaps,
    options, forwards, exchange-traded futures, other derivatives,
    commodities and foreign exchange products;
    Securities clearance, settlement financing services and prime
    brokerage;
    Private equity and other principal investing activities; and
    Research services on a global basis  Bank of
    America Acquisition
   42




---



##### Table of Contents



paid-in-capital
    Basis of
    Presentation
    non-U.S. subsidiaries non-U.S. subsidiaries.
   43




---



##### Table of Contents




    The reclassification of bifurcated embedded derivatives from the
    balance sheet classification of the host instrument (e.g.,
    long-term borrowings for structured notes) to derivative
    contracts within trading assets and trading liabilities;
    The reclassification of derivatives that had been used for asset
    and liability management hedging from other assets and other
    payables-interest and other to derivative contracts within
    trading assets and trading liabilities;
    The reclassification of certain loans designated as held for
    trading, held for sale or held for investment to either held for
    sale or held for investment; and
    The reclassification of the financing provided to Bloomberg,
    Inc. in connection with the sale of Merrill Lynchs
    interest in Bloomberg, L.P. from investment securities to loans,
    notes and mortgages.    Generally Accepted Accounting
    Principles,
  Consolidation
    Accounting Policies
     44




---



##### Table of Contents



Consolidation , Investments  Equity Method and Joint Ventures
  and/or and/or
  Transfers
    and Servicing
  Securitization
    Activities
    
    The transferred assets have been legally isolated from the
    transferor even in bankruptcy or other receivership;
    The transferee has the right to pledge or exchange the assets it
    received, or if the entity is a QSPE the beneficial interest
    holders have the right to pledge or exchange their beneficial
    interests; and
    The transferor does not maintain effective control over the
    transferred assets (e.g., the ability to unilaterally cause the
    holder to return specific transferred assets).  Revenue
    Recognition
   45




---



##### Table of Contents



other-than-temporary-impairment available-for-sale
    Use of
    Estimates
    
    Valuations of assets and liabilities requiring fair value
    estimates;
    The allowance for credit losses;
    Determination of
    other-than-temporary
    impairments for
    available-for-sale
    investment securities;
    The outcome of litigation;
    Assumptions and cash flow projections used in determining
    whether VIEs should be consolidated and the determination of the
    qualifying status of QSPEs;
    The realization of deferred taxes and the recognition and
    measurement of uncertain tax positions;
    The carrying amount of goodwill and intangible assets;
    The amortization period of intangible assets with definite lives; 46




---



##### Table of Contents




    Incentive-based compensation accruals and valuation of
    share-based payment compensation arrangements; and
    Other matters that affect the reported amounts and disclosure of
    contingencies in the financial statements.    Fair
    Value Measurement
  Investments  Debt
    and Equity Securities Derivatives and Hedging 825-10-25, Financial Instruments  Recognition, Financial
    Services  Brokers and Dealers Financial
    Services  Investment Companies
  Fair Value Measurements and Disclosures
  over-the-counter
  and/or and/or
 47




---



##### Table of Contents



Liquidity
    Counterparty
    Credit Risk
      Legal
    Reserves
    Income
    Taxes
  Income Taxes
 48




---



##### Table of Contents



Goodwill
    and Intangibles
  Intangibles  Goodwill and
    Other
  Property, Plant and Equipment
   49




---



##### Table of Contents



Employee
    Stock Options
    Balance
    Sheet
  Cash and
    Cash Equivalents
    Cash and
    Securities Segregated for Regulatory Purposes or Deposited with
    Clearing Organizations
  and/or and/or day-to-day
  Securities
    Financing Transactions
     50




---



##### Table of Contents



and/or
      Rule 15c3-3
  and/or
      Trading
    Assets and Liabilities
   51




---



##### Table of Contents



Derivatives
    Investment
    Securities
    Marketable
    Investments
  held-to-maturity Held-to-maturity other-than-temporary, available-for-sale
    held-to-maturity available-for-sale other-than-temporary. other-than-temporary other-than-temporary, other-than-temporary
 52




---



##### Table of Contents



available-for-sale other-than-temporary
    
    Identifying securities with indicators of possible impairment;
    Analyzing individual securities with fair value less than
    amortized cost for specific factors including:  
    The estimated length of time to recover from fair value to
    amortized cost;
    The severity and duration of the fair value decline from
    amortized cost;
    Deterioration in the financial condition of the issuer;  
    Discussing evidential matter, including an evaluation of the
    factors that could cause individual securities to have an
    other-than-temporary
    impairment;
    Determining whether Merrill Lynch intends to sell the security
    or if it is more likely than not that Merrill Lynch will be
    required to sell the security before recovery of its amortized
    cost; and
    Documenting the analysis and conclusions.  Non-Qualifying
    Investments
    and/or
    other-than-temporary.
  other-than-temporary.
 53




---



##### Table of Contents



Loans,
    Notes, and Mortgages, Net
  310-30, Loans and Debt Securities Acquired with Deteriorated Credit
    Quality
         54




---



##### Table of Contents



Other
    Receivables and Payables
  Customer
    Receivables and Payables
    Brokers
    and Dealers Receivables and Payables
    Interest
    and Other Receivables and Payables
    Equipment
    and Facilities
     55




---



##### Table of Contents



Other
    Assets
      Deposits
    Short-
    and Long-Term Borrowings
        Stock-Based
    Compensation
  Compensation  Stock
    Compensation
 56




---



##### Table of Contents



New
    Accounting Pronouncements
          other-than-temporary other-than-temporary
  Financial
    Instruments
  805-10, Business Combinations
 57




---



##### Table of Contents



58




---



##### Table of Contents



Note 2.  Acquisition and Subsequent
    Transactions with Bank of America Corporation    (dollars in billions, except
    per share amounts)Purchase PriceMerrill Lynch common shares exchanged (in millions)


1,600Exchange ratio


0.8595Bank of Americas common shares issued (in millions)


1,375Purchase price per share of Bank of Americas common
    stock(1)

$
14.08Total value of Bank of Americas common shares and cash
    exchanged for fractional shares

$
19.4Merrill Lynch preferred
    stock(2)


8.6Fair value of outstanding employee stock awards


1.1Total purchase price

$
29.1Allocation of the purchase
    price(3)Merrill Lynch stockholders equity

$
19.9Merrill Lynch goodwill and intangible assets


(2.6
)Pre-tax adjustments to reflect acquired assets and liabilities
    at fair value:Securities and derivatives


(1.9
)Loans


(6.1
)Intangible
    assets(4)(6)


5.4Other assets/liabilities


(0.8
)Long-term borrowings


16.0Pre-tax total adjustments


12.6Deferred income taxes


(5.9
)After-tax total adjustments


6.7Fair value of net assets acquired

$
24.0Goodwill resulting from the acquisition by Bank of
    America(5)(6)

$
5.1  (1)
    
    The value of the shares of
    common stock exchanged with Merrill Lynch shareholders was based
    upon the closing price of Bank of Americas common stock at
    December 31, 2008, the last trading day prior to the date
    of acquisition. (2)
    
    Represents Merrill Lynchs
    preferred stock exchanged for Bank of America preferred stock
    having substantially identical terms and also includes
    $1.5 billion of convertible preferred stock.(3)
    
    See Note 22 for further
    information on the impact of purchase accounting adjustments on
    Merrill Lynchs quarterly results of operations.(4)
    
    Consists of trade name of
    $1.5 billion and customer relationship and core deposit
    intangibles of $3.9 billion. The amortization life is
    10 years for the customer relationship and core deposit
    intangibles, which are primarily amortized on a straight-line
    basis.(5)
    
    No goodwill is expected to be
    deductible for federal income tax purposes.(6)
    
    A portion of the goodwill and
    intangible assets initially recognized were subsequently
    transferred to Bank of America in connection with the sale of
    Merrill Lynchs U.S. banks to Bank of America.  Asset
    Transfers
   59




---



##### Table of Contents



Sale of
    U.S. Banks to Bank of America
        Acquisition
    of Banc of America Investment Services, Inc. (BAI)
    from Bank of America
   60




---



##### Table of Contents



Note 3.  Segment and Geographic Information  Segment
    Information
  Segment Reporting
    Geographic
    Information
    
    United States;
    Europe, Middle East, and Africa (EMEA);
    Pacific Rim;
    Latin America; and
    Canada.    
    Revenues and expenses are generally recorded based on the
    location of the employee generating the revenue or incurring the
    expense;
    Pre-tax earnings or loss from continuing operations include the
    allocation of certain shared expenses among regions; and
    Intercompany transfers are based primarily on service agreements. 61




---



##### Table of Contents



(dollars in millions)Successor Company


Predecessor CompanyFor the Year Ended


For the Year Ended

For the Year EndedDecember 31,
    2009


December 26,
    2008

December 28,
    2007Revenues, net of interest expenseEurope, Middle East, and
    Africa(1)

$
5,841



$
(2,390
)

$
5,973Pacific Rim


2,136




69



5,065Latin America


823




1,237



1,401Canada


242




161



430Total
    Non-U.S.


9,042




(923
)


12,869United
    States(2)(3)(4)


14,244




(11,670
)


(1,619
)Total revenues, net of interest expense

$
23,286



$
(12,593
)

$
11,250Pre-tax earnings/(loss) from continuing
    operations(5)Europe, Middle East, and
    Africa(1)

$
3,043



$
(6,735
)

$
1,211Pacific Rim


181




(2,559
)


2,403Latin America


239




340



632Canada


107




5



235Total
    Non-U.S.


3,570




(8,949
)


4,481United
    States(2)(3)(4)(5)


328




(32,882
)


(17,312
)Total pre-tax earnings/(loss) from continuing
    operations(6)

$
3,898



$
(41,831
)

$
(12,831
)  (1)
    
    The EMEA 2008 results included
    net losses of $4.3 billion primarily related to residential
    and commercial mortgage-related exposures. (2)
    
    U.S. results for the year ended
    December 31, 2009 included net losses of $5.2 billion,
    which resulted from the narrowing of Merrill Lynchs credit
    spreads on the carrying values of certain long-term borrowings,
    primarily structured notes.(3)
    
    Corporate net revenues and
    adjustments are reflected in the U.S. region.(4)
    
    The U.S. 2008 results included
    net losses of $21.5 billion, primarily related to credit
    valuation adjustments related to hedges with financial
    guarantors, losses from
    asset-backed
    collateralized debt obligations (ABS CDOs), losses
    from residential and commercial mortgage-related exposures,
    other than temporary impairment charges recognized in the
    investment securities portfolio, and losses on leveraged finance
    loans and commitments. These losses were partially offset by
    gains of $5.1 billion that resulted from the widening of
    Merrill Lynchs credit spreads on the carrying value of
    certain long-term borrowings, primarily structured notes, and a
    $4.3 billion net gain related to the sale of Merrill
    Lynchs ownership stake in Bloomberg L.P.(5)
    
    The U.S. 2007 results included
    net losses of $23.2 billion related to ABS CDOs, U.S.
    sub-prime
    residential mortgages and securities, and credit valuation
    adjustments related to hedges with financial guarantors on U.S.
    ABS CDOs.(6)
    
    See Note 19 for further
    information on discontinued operations. 62




---



##### Table of Contents



Note 4.  Fair Value Disclosures  Fair
    Value Accounting
  Fair
    Value Hierarchy
      Level 1.
    Financial assets and liabilities whose values are based on
    unadjusted quoted prices for identical assets or liabilities in
    an active market that Merrill Lynch has the ability to access
    (examples include active exchange-traded equity securities,
    exchange-traded derivatives, U.S. Government securities,
    and certain other sovereign government obligations).Level 2.
    Financial assets and liabilities whose values are based on
    quoted prices in markets that are not active or model inputs
    that are observable either directly or indirectly for
    substantially the full term of the asset or liability.
    Level 2 inputs include the following:  a)
    Quoted prices for similar assets or liabilities in active
    markets (examples include restricted stock and U.S. agency
    securities);  b)
    Quoted prices for identical or similar assets or liabilities in
    non-active markets (examples include corporate and municipal
    bonds, which trade infrequently);  c)
    Pricing models whose inputs are observable for substantially the
    full term of the asset or liability (examples include most
    over-the-counter
    derivatives, including interest rate and currency
    swaps); and  d)
    Pricing models whose inputs are derived principally from or
    corroborated by observable market data through correlation or
    other means for substantially the full term of the asset or
    liability (examples include certain residential and commercial
    mortgage-related assets, including loans, securities and
    derivatives).  Level 3.
    Financial assets and liabilities whose values are based on
    prices or valuation techniques that require inputs that are both
    unobservable and significant to the overall fair value
    measurement. These inputs reflect managements own
    assumptions about the assumptions a market participant would use
    in pricing the asset or liability (examples include certain
    private equity investments, certain residential and commercial
    mortgage-related assets (including loans, securities and
    derivatives), and long-dated or complex derivatives (including
    certain equity and currency derivatives and long-dated options
    on gas and power)).     63




---



##### Table of Contents



Valuation
    Techniques
    U.S.
    Government and agencies
  U.S. treasury securities
  U.S. agency securities
  Non-U.S.
    governments and agencies
    Municipal
    debt
  Municipal bonds
  Auction Rate Securities (ARS)
   64




---



##### Table of Contents



Corporate
    and other debt
  Corporate bonds and/or cash-to-synthetic and/or
  Corporate loans and commitments cash-to-synthetic
  Mortgages,
    mortgage-backed and asset-backed
  Residential Mortgage-Backed Securities (RMBS),
    Commercial Mortgage-Backed Securities (CMBS), and
    other Asset-Backed Securities (ABS)
      Equities
  Exchange-Traded Equity Securities
  Derivative
    contracts
  Listed Derivative Contracts
  OTC Derivative Contracts
 65




---



##### Table of Contents



Collateralized Debt Obligations (CDOs)
  Investment
    securities non-qualifying
  Investments in Private Equity, Real Estate and Hedge
    Funds
  and/or
 66




---



##### Table of Contents



Resale
    and repurchase agreements
    Long-term
    borrowings
   67




---



##### Table of Contents



Recurring
    Fair Value
    (dollars in millions)Fair Value Measurements on a Recurring BasisSuccessor Companyas of December 31, 2009NettingLevel 1

Level 2

Level 3

Adj(1)

TotalAssets:Securities segregated for regulatory purposes or deposited with
    clearing organizations:Mortgages, mortgage-backed and asset-backed

$
-


$
5,525


$
-


$
-


$
5,525Corporate debt


-



579



-



-



579Non-U.S.
    governments and agencies


946



893



-



-



1,839U.S. Government and agencies


1,046



1,541



-



-



2,587Total securities segregated for regulatory purposes or deposited
    with clearing organizations


1,992



8,538



-



-



10,530Receivables under resale agreements


-



41,740



-



-



41,740Receivables under securities borrowed transactions


-



2,888



-



-



2,888Trading assets, excluding derivative contracts:Equities


23,083



6,297



259



-



29,639Convertible debentures


-



4,862



-



-



4,862Non-U.S.
    governments and agencies


17,407



2,718



1,131



-



21,256Corporate debt


-



9,241



6,540



-



15,781Preferred
    stock(2)


-



436



562



-



998Mortgages, mortgage-backed and asset-backed


-



1,680



6,291



-



7,971U.S. Government and agencies


979



479



-



-



1,458Municipals and money markets


798



5,181



2,148



-



8,127Commodities and related contracts


-



651



-



-



651Total trading assets, excluding derivative contracts


42,267



31,545



16,931



-



90,743Derivative contracts


2,218



658,264



17,939



(628,839
)


49,582Investment securities
    available-for-sale:Mortgage-backed securities  agency collateralized
    mortgage obligations


-



9,688



-



-



9,688Mortgage-backed securities  non-agency MBSs


-



1,132



473



-



1,605Total investment securities
    available-for-sale


-



10,820



473



-



11,293Investment securities non-qualifying


2,027



451



3,696



-



6,174Total investment securities


2,027



11,271



4,169



-



17,467Securities received as collateral


15,780



566



-



-



16,346Loans, notes and mortgages


-



654



4,115



-



4,769Liabilities:Payables under repurchase agreements


-



37,325



-



-



37,325Short-term borrowings


-



813



-



-



813Trading liabilities, excluding derivative contracts:Equities


12,051



1,069



-



-



13,120Convertible debentures


-



534



-



-



534Non-U.S.
    governments and agencies


12,028



430



386



-



12,844Corporate debt


-



1,903



-



-



1,903U.S. Government and agencies


1,296



-



-



-



1,296Municipals, money markets and other


273



370



-



-



643Total trading liabilities, excluding derivative contracts


25,648



4,306



386



-



30,340Derivative contracts


1,727



662,629



11,073



(640,309
)


35,120Obligation to return securities received as collateral


15,780



566



-



-



16,346Other payables  interest and other


-



54



186



-



240Long-term borrowings


-



42,357



4,683



-



47,040  (1)
    
    Represents counterparty and
    cash collateral netting. 68




---



##### Table of Contents



(2)
    
    Primarily represents auction
    rate securities.  and/or
      and/or
  and/or
  (dollars in millions)Fair Value Measurements on a Recurring BasisPredecessor Companyas of December 26, 2008NettingLevel 1

Level 2

Level 3

Adj(1)

TotalAssets:Securities segregated for regulatory purposes or deposited with
    clearing organizations

$
1,421


$
10,156


$
-


$
-


$
11,577Receivables under resale agreements


-



62,146



-



-



62,146Receivables under securities borrowed transactions


-



853



-



-



853Trading assets, excluding derivative contracts


30,106



33,902



22,120



-



86,128Derivative contracts


8,538



1,239,225



37,325



(1,195,611
)


89,477Investment securities


2,280



29,254



3,279



-



34,813Securities received as collateral


9,430



2,228



-



-



11,658Loans, notes and mortgages


-



690



359



-



1,049Other
    assets(2)


-



8,046



-



-



8,046Liabilities:Payables under repurchase agreements


-



32,910



-



-



32,910Short-term borrowings


-



3,387



-



-



3,387Trading liabilities, excluding derivative contracts


14,098



4,010



-



-



18,108Derivative contracts


8,438



1,254,158



35,018



(1,226,251
)


71,363Obligation to return securities received as collateral


9,430



2,228



-



-



11,658Other payables  interest and
    other(2)


10



741



-



(79
)


672Long-term
    borrowings(3)


-



41,575



7,480



-



49,055  (1)
    
    Represents counterparty and
    cash collateral netting.(2)
    
    Primarily represents certain
    derivatives used for non-trading purposes.(3)
    
    Includes bifurcated embedded
    derivatives carried at fair value.    and/or
   69




---



##### Table of Contents



and/or
  and/or
    (dollars in millions)Level 3 Financial Assets and LiabilitiesSuccessor CompanyYear Ended December 31, 2009Total Realized and Unrealized Gains

Total Realized and



Purchases,or (Losses) included in Income

Unrealized Gains

Unrealized

IssuancesBeginning

Principal

Other



or (Losses)

Gains to

and

Transfers

EndingBalance

Transactions

Revenue

Interest

included in Income

OCI

Settlements

in (out)

BalanceAssets:Trading assets, excluding derivative
    contracts(1):Equities

$
231


$
(115
)

$
-


$
-


$
(115
)

$
-


$
206


$
(63
)

$
259Non-U.S.
    governments and agencies


30



136



-



-



136



-



172



793



1,131Corporate debt


10,295



424



-



-



424



-



154



(4,333
)


6,540Preferred stock


3,344



(191
)


-



-



(191
)


-



(2,696
)


105



562Mortgages, mortgage-backed and asset-backed


7,590



(428
)


-



-



(428
)


-



1,522



(2,393
)


6,291Municipals and money markets


798



(27
)


-



-



(27
)


-



1,390



(13
)


2,148Total trading assets, excluding derivative contracts


22,288



(201
)


-



-



(201
)


-



748



(5,904
)


16,931Derivative contracts, net


2,307



(2,209
)


-



-



(2,209
)


-



1,910



4,858



6,866Investment securities
    available-for-sale:Mortgage-backed securities  residential non-agency
    MBSs


350



-



(449
)


178



(271
)


41



(1,859
)


2,212



473Total investment securities
    available-for-sale


350



-



(449
)


178



(271
)


41



(1,859
)


2,212



473Investment securities non-qualifying


2,761



-



1,029



-



1,029



-



(103
)


9



3,696Total investment securities


3,111



-



580



178



758



41



(1,962
)


2,221



4,169Loans, notes and mortgages


359



-



710



88



798



-



(2,931
)


5,889



4,115Liabilities:Trading liabilities, excluding derivative contracts:Non-U.S.
    governments and agencies


-



(38
)


-



-



(38
)


-



-



348



386Total trading liabilities, excluding derivative contracts


-



(38
)


-



-



(38
)


-



-



348



386Other liabilities  interest and other


-



-



754



-



754



-



(358
)


1,298



186Long-term borrowings


7,480



(2,083
)


(227
)


-



(2,310
)


-



(829
)


(4,278
)


4,683  (1)
    
    In 2009, Merrill Lynch
    reclassified securities that were previously included within
    Investment securities to Trading assets. The impact of this
    reclassification on Level 3 assets ($168 million) is
    included in the beginning balances for total Trading assets and
    total Investment securities in the table above.       70




---



##### Table of Contents



available-for-sale
  available-for-sale
  (dollars in millions)Level 3 Financial Assets and LiabilitiesPredecessor CompanyYear Ended December 26, 2008Total Realized and UnrealizedGains or (Losses) included in

Total Realized and

Purchases,Income

Unrealized Gains

IssuancesBeginning

Principal

Other



or (Losses)

and

Transfers

EndingBalance

Transactions

Revenue

Interest

included in Income

Settlements

in (out)

BalanceAssets:Securities segregated for regulatory purposes or deposited with
    clearing organizations

$
84


$
-


$
-


$
1


$
1


$
(79
)

$
(6
)

$
-Trading assets


9,773



(5,460
)


-



122



(5,338
)


10,114



7,571



22,120Derivative contracts, net


(9,069
)


(11,955
)


-



5



(11,950
)


26,187



(2,861
)


2,307Investment securities


5,491



(1,021
)


(1,535
)


-



(2,556
)


426



(82
)


3,279Loans, notes and mortgages


63



-



(105
)


(8
)


(113
)


399



10



359Liabilities:Long-term borrowings


4,765



5,582



285



-



5,867



1,198



7,384



7,480   (dollars in millions)Level 3 Financial Assets and LiabilitiesPredecessor CompanyYear Ended December 28, 2007Total Realized and UnrealizedGains or

Total Realized and

Purchases,(Losses) included in Income

Unrealized Gains

IssuancesBeginning

Principal

Other



or (Losses)

and

Transfers

EndingBalance

Transactions

Revenue

Interest

included in Income

Settlements

in (out)

BalanceAssets:Securities segregated for regulatory purposes or deposited with
    clearing organizations

$
-


$
(5
)

$
-


$
1


$
(4
)

$
-


$
88


$
84Trading assets


2,021



(4,180
)


-



46



(4,134
)


2,945



8,941



9,773Derivative contracts, net


(2,030
)


(7,687
)


4



25



(7,658
)


465



154



(9,069
)Investment securities


5,117



(2,412
)


518



8



(1,886
)


3,000



(740
)


5,491Loans, notes and mortgages


7



-



(18
)


-



(18
)


(5
)


79



63Liabilities:Long-term borrowings


-



524



7



-



531



2,203



3,093



4,765  71




---



##### Table of Contents



(dollars in millions)Unrealized Gains or (Losses) for Level 3Assets and Liabilities Still HeldSuccessor CompanyYear Ended December 31, 2009Principal

OtherTransactions

Revenue

Interest

TotalAssets:Trading assets, excluding derivative contracts:Equities

$
(115
)

$
-


$
-


$
(115
)Non-U.S.
    governments and agencies


137



-



-



137Corporate debt


240



-



-



240Preferred stock


(155
)


-



-



(155
)Mortgages, mortgage-backed and asset-backed


(327
)


-



-



(327
)Municipals and money markets


(26
)


-



-



(26
)Total trading assets, excluding derivative contracts


(246
)


-



-



(246
)Derivative contracts, net


(2,030
)


-



-



(2,030
)Investment securities
    available-for-sale:Mortgage-backed securities - non-agency MBSs


-



(258
)


178



(80
)Total investment securities
    available-for-sale


-



(258
)


178



(80
)Investment securities non-qualifying


-



1,057



-



1,057Total investment securities


-



799



178



977Loans, notes and mortgages


-



856



-



856Liabilities:Trading liabilities, excluding derivative contracts:Non-U.S.
    governments and agencies


(38
)


-



-



(38
)Total trading liabilities, excluding derivative contracts


(38
)


-



-



(38
)Other liabilities  interest and other


-



782



-



782Long-term borrowings


(2,303
)


(225
)


-



(2,528
)    72




---



##### Table of Contents



(dollars in millions)Unrealized Gains or (Losses) for Level 3Assets and Liabilities Still HeldPredecessor CompanyYear Ended December 26, 2008Principal

OtherTransactions

Revenue

Interest

TotalAssets:Securities segregated for regulatory purposes or deposited with
    clearing organizations

$
-


$
-


$
1


$
1Trading assets


(4,945
)


-



83



(4,862
)Derivative contracts, net


114



-



5



119Investment securities


(964
)


(1,523
)


-



(2,487
)Loans, notes, and mortgages


-



(94
)


(8
)


(102
)Liabilities:Long-term borrowings


5,221



285



-



5,506   (dollars in millions)Unrealized Gains or (Losses) for Level 3Assets and Liabilities Still HeldPredecessor CompanyYear Ended December 28, 2007Principal

OtherTransactions

Revenue

Interest

TotalAssets:Securities segregated for regulatory purposes or deposited with
    clearing organizations

$
(5
)

$
-


$
1


$
(4
)Trading assets


(4,205
)


-



4



(4,201
)Derivative contracts, net


(7,826
)


(2
)


25



(7,803
)Investment securities


(2,412
)


428



8



(1,976
)Loans, notes, and mortgages


-



1



-



1Liabilities:Long-term borrowings


524



7



-



531   Non-recurring
    Fair Value
    (dollars in millions)Non-Recurring BasisSuccessor Company

Gains/(Losses)as of December 31, 2009

Year EndedLevel 1

Level 2

Level 3

Total

December 31, 2009Assets:Investment securities non-qualifying

$
-


$
-


$
182


$
182


$
(43
)Loans, notes and mortgages


-



524



2,671



3,195



(101
)Other assets


-



-



210



210



(225
)Liabilities:Other payables  interest and other


-



-



39



39



38     73




---



##### Table of Contents



(dollars in millions)Non-Recurring BasisPredecessor Company



Lossesas of December 26, 2008



Year EndedLevel 1

Level 2

Level 3

Total

December 26, 2008Assets:Loans, notes, and mortgages

$
-


$
4,386


$
6,727


$
11,113


$
(6,555
)Goodwill


-



-



-



-



(2,300
)Liabilities:Other payables  interest and other


-



1,258



67



1,325



(653
)     price-to-earnings price-to-book
    Fair
    Value Option Election
   74




---



##### Table of Contents



(dollars in millions)Successor CompanyChanges in Fair Value for the Year EndedDecember 31, 2009, for Items Measured at FairValue Pursuant to theFair Value Option ElectionGains/

Gains/

Total(Losses)

(Losses)

ChangesPrincipal

Other

in FairTransactions

Revenues

ValueAssets:Receivables under resale agreements

$
(364
)

$
-


$
(364
)Investment securities


379



(177
)


202Loans, notes and mortgages


-



839



839Liabilities:Payables under repurchase agreements


162



-



162Short-term borrowings


(242
)


6



(236
)Other payables  interest and other


-



761



761Long-term
    borrowings(1)


(9,121
)


(33
)


(9,154
)  (1)
    
    Other revenues primarily
    represent fair value changes on non-recourse long-term
    borrowings issued by consolidated SPEs.  (dollars in millions)Predecessor CompanyChanges in Fair Value for the Year Ended


Changes in Fair Value for the Year EndedDecember 26, 2008, for Items Measured at Fair


December 28, 2007, for Items Measured atValue Pursuant to the


Fair Value Pursuant to theFair Value Option Election


Fair Value Option ElectionGains/

Gains/

Total


Gains/



Total(Losses)

(Losses)

Changes


(Losses)

Gains

ChangesPrincipal

Other

in Fair


Principal

Other

in FairTransactions

Revenues

Value


Transactions

Revenues

ValueAssets:Receivables under resale agreements

$
190


$
-


$
190



$
124


$
-


$
124Investment securities


(1,637
)


(923
)


(2,560
)



234



43



277Loans, notes and mortgages


(87
)


(11
)


(98
)



(2
)


73



71Liabilities:Payables under repurchase agreements


(54
)


-



(54
)



(7
)


-



(7
)Short-term borrowings


(438
)


-



(438
)



-



-



-Long-term
    borrowings(1)


15,938



1,709



17,647




3,857



1,182



5,039  (1)
    
    Other revenues primarily
    represent fair value changes on non-recourse long-term
    borrowings issued by consolidated SPEs.    Resale
    and repurchase agreements
    Loans,
    notes and mortgages and loan commitments
   75




---



##### Table of Contents



Short-term
    and long-term borrowings
        (dollars in millions)Successor CompanyFair Value

Principalat

AmountDecember 31,

Due Upon2009

Maturity

DifferenceAssets:Receivables under resale agreements

$
41,740


$
41,454


$
286Receivables under securities borrowed transactions


2,888



2,888



-Loans, notes and mortgages


4,649



7,236



(2,587
)Liabilities:Long-term
    borrowings(1)


47,040



50,543



(3,503
)  (1)
    
    The majority of the difference
    relates to the impact of the widening of Merrill Lynchs
    credit spreads, the change in fair value of non-recourse debt,
    and zero coupon notes issued at a substantial discount from the
    principal amount.  76




---



##### Table of Contents



(dollars in millions)Predecessor CompanyFair Value

Principalat

AmountDecember 26,

Due Upon2008

Maturity

DifferenceAssets:Receivables under resale agreements

$
62,146


$
61,466


$
680Receivables under securities borrowed transactions


853



853



-Loans, notes and mortgages


979



1,326



(347
)Liabilities:Long-term
    borrowings(1)


49,521



62,244



(12,723
)  (1)
    
    The majority of the difference
    relates to the impact of the widening of Merrill Lynchs
    credit spreads, the change in fair value of non-recourse debt,
    and zero coupon notes issued at a substantial discount from the
    principal amount.  Trading
    Risk Management
        Market
    Risk
     77




---



##### Table of Contents



Interest
    Rate Risk
      Currency
    Risk
    Equity
    Price Risk
    Credit
    Spread Risk
   78




---



##### Table of Contents



Commodity
    Price and Other Risks
  and/or and/or
  Counterparty
    Credit Risk
        failed-to-receive) failed-to-receive,
  Concentrations
    of Credit Risk
    Concentration
    of Risk to Financial Guarantors
  U.S. sub-prime
 79




---



##### Table of Contents



Concentration
    of Risk to the U.S. Government and its Agencies
    Concentration
    of Risk to the Mortgage Markets
    
    Net exposure of $6.3 billion in commercial real estate
    related positions; and
    Net exposures of $2.6 billion in other residential
    mortgage-related positions and $770 million in
    U.S. Prime residential mortgage-related positions,
    excluding Merrill Lynchs investment securities portfolio.      Other
    Concentrations of Risk
   80




---



##### Table of Contents



Derivatives
    one-day
  
 Note 5.
    Fair Value of Financial Instruments       Short-term
    Financial Instruments
   81




---



##### Table of Contents



Loans,
    Notes and Mortgages
    Deposits
    Long-term
    Borrowings
      (dollars in millions)Successor Company


Predecessor CompanyDecember 31, 2009


December 26, 2008Book Value

Fair Value


Book Value

Fair ValueFinancial assetsLoans, notes and
    mortgages(1)

$
37,663


$
37,715



$
69,190


$
63,749Financial liabilitiesDeposits


15,187



15,187




96,107



96,107Long-term
    borrowings(2)


154,951



162,645




204,934



189,834  (1)
    
    Loans are presented net of
    allowance for loan losses and exclude leases. The fair value is
    determined based on the present value of future cash flows using
    credit spreads or risk adjusted rates of return that a buyer of
    the portfolio would require. Merrill Lynch expects to collect
    the principal cash flows underlying the book values as well as
    the related interest cash flows. (2)
    
    Includes junior subordinated
    notes (related to trust preferred securities). 82




---



##### Table of Contents



Note 6.
    Derivatives     net-by-counterparty
    Trading
    derivatives
    Derivatives
    that Contain a Significant Financing Element
    Non-trading
    derivatives
    1.
    Merrill Lynchs debt was issued in a variety of maturities
    and currencies to achieve the lowest cost financing possible.
    Merrill Lynch enters into derivative transactions to hedge these
    liabilities. Derivatives used most frequently include swap
    agreements that:  
    Convert fixed-rate interest payments into variable-rate payments;
    Change the underlying interest rate basis or reset
    frequency; and
    Change the settlement currency of a debt instrument. 83




---



##### Table of Contents



2.
    Merrill Lynch uses foreign-exchange forward contracts,
    foreign-exchange options, and currency swaps to hedge its net
    investments in foreign operations, as well as other foreign
    currency exposures (e.g.,
    non-U.S. dollar
    denominated debt and expenses). These derivatives are used to
    mitigate the impact of changes in exchange rates. Changes in the
    fair value of these derivatives are reported in other revenue,
    unless net investment hedge accounting is applied.3.
    Merrill Lynch enters into futures, swaps, options and forward
    contracts to manage the price risk of certain commodity
    inventory and forecasted commodity purchases and sales. Changes
    in fair value of these derivatives are reported in principal
    transaction revenues, unless cash flow hedge accounting is
    applied.4.
    Merrill Lynch enters into credit default swaps to manage the
    credit risk on certain loans that are not part of trading
    activities. Changes in the fair value of these derivatives are
    reported in other revenue.    1.
    A hedge of the fair value of a recognized asset or liability
    (fair value hedge). Changes in the fair value of
    derivatives that are designated and qualify as fair value hedges
    of interest rate risk, along with the gain or loss on the hedged
    liability that is attributable to the hedged risk, are recorded
    in current period earnings as interest expense. Changes in the
    fair value of derivatives that are designated and qualify as
    fair value hedges of commodity price risk, along with the gain
    or loss on the hedged asset that is attributable to the hedged
    risk, are recorded in current period earnings in principal
    transactions.2.
    A hedge of the variability of cash flows to be received or paid
    related to a recognized asset or liability (cash flow
    hedge). Changes in the fair value of derivatives that are
    designated and qualify as cash flow hedges are recorded in OCI
    until earnings are affected by the variability of cash flows of
    the hedged asset or liability. For commodity hedges, the amount
    is reclassified out of OCI and recorded in principal
    transactions when the forecasted purchase or sale of the
    commodity occurs.3.
    A hedge of a net investment in a foreign operation (net
    investment hedge). Changes in the fair value of
    derivatives that are designated and qualify as hedges of a net
    investment in a foreign operation are recorded in the foreign
    currency translation adjustment account within OCI. Changes in
    the fair value of the hedge instruments that are associated with
    the difference between the spot rate and the contracted forward
    rate are recorded in current period earnings in other
    revenues/interest and dividend revenues.   84




---



##### Table of Contents



Fair
    value hedges of interest rate risk on long-term
    borrowings
  (dollars in millions)Year EndedAccount location

December 31, 2009Gain/(loss) recognized in income on the derivative

Interest expense

$
(2,732
)Gain/(loss) recognized in income on the long-term borrowing

Interest expense

$
2,010Gain/(loss) recognized in income due to hedge ineffectiveness

Interest expense

$
(722
)Carrying value of hedging derivatives as of December 31,
    2009Trading assets

$
3,362Trading liabilities

$
101Notional amount of hedging derivatives as of December 31,
    2009in an asset position



$
54,954in a liability position



$
4,770   Fair
    value hedges of commodity price risk on commodity
    inventory
  (dollars in millions)Year EndedAccount location

December 31,
    2009Gain/(loss) recognized in income on the derivative

Principal transactions

$
(51
)Gain/(loss) recognized in income on the commodity inventory

Principal transactions

$
52Gain/(loss) recognized in income due to hedge ineffectiveness

Principal transactions

$
1Carrying value of hedging derivatives as of December 31,
    2009Trading assets

$
78Trading liabilities

$
4Notional amount of hedging derivatives as of December 31,
    2009in an asset position



$
286in a liability position



$
34  85




---



##### Table of Contents



Cash flow
    hedges of commodity price risk on forecasted purchases and
    sales
  (dollars in millions)Year EndedAccount location

December 31,
    2009Gain/(loss) on the derivative deferred in equity

Accumulated othercomprehensive income

$
72Gain/(loss) reclassified into earnings in the current period

Principal transactions

$
71Gain/(loss) recognized in income due to hedge ineffectiveness

Principal transactions

$
(2
)Amount that is expected to be reclassified into earnings in the
    next 12 months as of December 31, 2009

Principal transactions

$
1Carrying value of hedging derivatives as of December 31,
    2009Trading assets

$
10Trading liabilities

$
5Notional amount of hedging derivatives as of December 31,
    2009in an asset position



$
92in a liability position



$
67   Net
    investment hedges of foreign operations
  (dollars in millions)Year EndedAccount location

December 31,
    2009Gain/(loss) on the derivative and non-derivative hedges deferred
    in equity

Accumulated other
    comprehensive income

$
(1,826
)Gain/(loss) recognized in income due to hedge ineffectiveness

Other revenue

$
-Gain/(loss) recognized in income from the unused portion (time
    value) of the hedging derivative

Other revenue/Interest and dividend
    revenue

$
(142
)Carrying value of hedging derivatives as of December 31,
    2009

Trading assets

$
353Trading liabilities

$
277Carrying value of non-derivative hedges as of December 31,
    2009

Long-term borrowings

$
598Notional amount of hedging derivatives as of December 31,
    2009in an asset position



$
16,531in a liability position



$
6,098   Losses on
    non-trading derivatives not in hedge relationships
  (dollars in millions)Year EndedAccount location

December 31,
    2009Interest rate risk

Interest expense

$
(832
)Foreign currency risk

Other revenue

$
(437
)Credit risk

Other revenue

$
(397
)  86




---



##### Table of Contents



830-20 Foreign Currency Transactions
  Derivative
    balances by primary risk
   87




---



##### Table of Contents



(dollars in millions)Contract/

Trading Assets-

Contract/

Trading Liabilities-Notional(1)

Derivative Contracts

Notional(1)

Derivative ContractsInterest rate contractsSwaps

$
10,059,442


$
472,860


$
9,748,704


$
471,423Futures and forwards


2,606,064



3,531



2,534,823



3,123Written options


-



-



1,461,830



46,521Purchased options


1,313,226



46,643



-



-Foreign exchange contractsSwaps


115,591



11,739



107,953



13,074Spot, futures and forwards


208,226



8,470



223,151



8,832Written options


-



-



264,836



10,859Purchased options


266,026



10,375



-



-Equity contractsSwaps


17,637



1,186



16,123



1,354Futures and forwards


41,821



2,999



33,844



2,165Written options


-



-



250,233



18,761Purchased options


240,650



15,596



-



-Commodity contractsSwaps


30,449



6,591



34,180



6,391Futures and forwards


202,571



10,369



185,109



9,612Written options


-



-



53,438



4,955Purchased options


50,372



4,750



-



-Credit derivativesPurchased protection:Credit default swaps


908,594



59,491



622,853



22,685Total return swaps


2,921



366



1,644



358Other Credit Derivatives


14,517



59



-



-Written protection:


-



-



-



-Credit default swaps


614,066



21,833



949,107



54,265Total return swaps


5,173



1,563



7,336



925Other Credit Derivatives


-



-



14,703



126Gross derivative assets/liabilities

$
16,697,346


$
678,421


$
16,509,867


$
675,429Less: Legally enforceable master netting






(602,157
)






(602,157
)Less: Cash collateral applied






(26,682
)






(38,152
)Total derivative assets and liabilities





$
49,582






$
35,120  (1)
    
    These amounts include trading
    derivatives, non-trading derivatives and bifurcated embedded
    derivatives.  Trading
    revenues
   88




---



##### Table of Contents



Non-trading derivatives
  For The
    Year Ended December 31, 2009
  (dollars in millions)Principal





Net InterestTransactions

Commissions

Other
    Revenues(1)

Profit/(Loss)

TotalInterest Rate Risk

$
1,712


$
61


$
20


$
564


$
2,357Foreign Exchange Risk


308



-



1



11



320Equity Risk


2,507



3,295



85



(247
)


5,640Commodity Risk


1,050



-



-



(157
)


893Credit Risk


3,835



52



504



1,523



5,914Total trading related


9,412



3,408



610



1,694



15,124Non-trading related


(5,459
)


2,477



3,288



(1,062
)


(756
)Total

$
3,953


$
5,885


$
3,898


$
632


$
14,368  (1)
    
    Includes other income and
    other-than-temporary
    impairment losses on
    available-for-sale
    debt securities.  Derivatives
    as guarantees
  Guarantees
 89




---



##### Table of Contents



(in millions)MaximumPayout/

Less than







CarryingNotional

1 year

1 − 3 years

3 − 5 years

Over 5 years

Value(1)Derivative contracts:Credit derivatives:Investment
    grade(2)

$
520,782


$
44,552


$
133,089


$
216,562


$
126,579


$
17,255Non-investment
    grade(2)


1,054,900



93,582



331,306



325,167



304,845



37,935Total credit derivatives


1,575,682



138,134



464,395



541,729



431,424



55,190Other derivatives


1,574,432



488,146



405,223



245,565



435,498



59,811Total derivative contracts

$
3,150,114


$
626,280


$
869,618


$
787,294


$
866,922


$
115,001  (1)
    
    Derivative contracts are shown
    on a gross basis prior to cash collateral or counterparty
    netting.(2)
    
    Refers to the creditworthiness
    of the underlying reference obligations.  Credit
    derivatives
  and/or
      (in millions)MaximumPayout/

Less than







CarryingNotional

1 year

1 − 3 years

3 − 5 years

Over 5 years

Value(1)Credit derivatives purchased

$
1,506,782


$
130,297


$
432,550


$
511,298


$
432,637


$
49,225Credit derivatives sold


1,555,077



135,686



463,129



540,713



415,549



50,609   (1)
    
    Derivative contracts are shown on a gross basis prior to cash
    collateral or counterparty netting. 90




---



##### Table of Contents



Other
    derivative contracts
      Credit
    risk management of derivatives
      210-20, Balance Sheet-Offsetting
   91




---



##### Table of Contents



Credit-risk
    related contingent features
    and/or
 Note 7.  Securities Financing Transactions    non-U.S. government
 92




---



##### Table of Contents



Rule 15c3-3
      (dollars in millions)Successor Company


Predecessor CompanyDecember 31,
    2009


December 26,
    2008Trading asset categoryCorporate debt and preferred stock

$
10,398



$
15,024Equities and convertible debentures


7,647




10,995Mortgages, mortgage-backed, and asset-backed securities


4,236




12,462Non-U.S.
    governments and agencies


1,786




587U.S. Government and agencies


1,455




4,982Municipals and money markets


8




1,320Total

$
25,530



$
45,370      93




---



##### Table of Contents



Note 8.  Investment Securities    
    Investments within the scope of Investment Accounting that are
    held by ML & Co. and certain of its non-broker-dealer
    subsidiaries consist of:  
    Debt securities, including debt
    held-for-investment
    and liquidity and collateral management purposes that are
    classified as
    available-for-sale,
    and debt securities that Merrill Lynch intends to hold until
    maturity;
    Marketable equity securities, which are generally classified as
    available-for-sale.  
    Non-qualifying investments are those that are not within the
    scope of Investment Accounting and consist principally of equity
    investments, including investments in partnerships and joint
    ventures. Included in equity investments are investments
    accounted for under the equity method of accounting, which
    consist of investments in (i) partnerships and certain
    limited liability corporations where Merrill Lynch has more than
    a minor influence (generally defined as greater than a three
    percent interest) and (ii) corporate entities where Merrill
    Lynch has the ability to exercise significant influence over the
    investee (generally defined as ownership and voting interest of
    20% to 50%). Also included in equity investments are private
    equity investments that Merrill Lynch holds for capital
    appreciation
    and/or
    current income and which are accounted for at fair value in
    accordance with the Investment Company Guide, as well as private
    equity investments accounted for at fair value under the fair
    value option election. The carrying value of such private equity
    investments reflects expected exit values based upon market
    prices or other valuation methodologies, including discounted
    expected cash flows and market comparables of similar companies.    (dollars in millions)Successor Company


Predecessor CompanyDecember 31,
    2009


December 26,
    2008Investment securitiesAvailable-for-sale(1)

$
16,818



$
34,103Trading(2)


-




1,745Held-to-maturity(3)


246




4,576Non-qualifying(4)Equity
    investments(5)


19,549




24,306Other investments


1,752




1,432Total

$
38,365



$
66,162  (1)
    
    At December 31, 2009 and
    December 26, 2008, includes $5.5 billion and
    $9.2 billion, respectively, of investment securities
    reported in cash and securities segregated for regulatory
    purposes or deposited with clearing organizations. The decline
    in
    available-for-sale
    securities from December 26, 2008 primarily reflected asset
    sales and the sale of MLBUSA and MLBT-FSB to Bank of
    America.(2)
    
    During 2009, investment
    securities classified as trading were reclassified to trading
    assets.(3)
    
    The 2008 balance primarily
    relates to notes issued by Bloomberg, Inc. in connection with
    the sale of Merrill Lynchs 20% stake in Bloomberg L.P.,
    which was reclassified to loans held for investment in 2009
    pursuant to the acquisition by Bank of America.(4)
    
    Non-qualifying for Investment
    Accounting purposes.(5)
    
    Includes Merrill Lynchs
    investment in BlackRock, Inc. 94




---



##### Table of Contents



other-than-temporary available-for-sale other-than-temporary other-than-temporary-impairment
    (dollars in millions)Successor CompanyDecember 31, 2009Gross

GrossAmortized

Unrealized

Unrealized

FairCost

Gains

Losses

ValueAvailable-for-SaleMortgage-backed securities:Agency collateralized mortgage obligations

$
14,775


$
449


$
(11
)

$
15,213Non-agency


1,952



154



(501
)


1,605Total

$
16,727


$
603


$
(512
)

$
16,818Held-to-MaturityCorporate debt and municipal

$
246


$
-


$
-


$
246Total

$
16,973


$
603


$
(512
)

$
17,064   (dollars in millions)Predecessor CompanyDecember 26, 2008Cost/

Gross

Gross

EstimatedAmortized

Unrealized

Unrealized

FairCost

Gains

Losses

ValueAvailable-for-SaleMortgage- and asset-backed

$
42,142


$
19


$
(9,390
)

$
32,771U.S. Government and agencies


712



2



-



714Corporate debt


343



-



(72
)


271Other(1)


259



-



-



259Total debt securities


43,456



21



(9,462
)


34,015Equity securities


93



17



(22
)


88Total

$
43,549


$
38


$
(9,484
)

$
34,103Held-to-MaturityCorporate debt and
    municipal(2)

$
4,560


$
-


$
-


$
4,560Mortgage- and asset-backed


16



-



-



16Total

$
4,576


$
-


$
-


$
4,576  (1)
    
    Includes investments in
    non-U.S.
    Government and agency securities and certificates of
    deposit.(2)
    
    Primarily relates to notes
    issued by Bloomberg Inc. in connection with the sale of Merrill
    Lynchs 20% ownership stake in Bloomberg, L.P.  available-for-sale
 95




---



##### Table of Contents



available-for-sale
  (dollars in millions)Less than 1 Year

More than 1 Year

TotalUnrealized



Unrealized



UnrealizedAsset category

Fair Value

Losses

Fair Value

Losses

Fair Value

LossesPredecessor CompanyDecember 26, 2008Mortgage- and asset-backed

$
8,449


$
(4,132
)

$
22,291


$
(5,910
)

$
30,740


$
(10,042
)U.S. Government and agencies


3



-



-



-



3



-Corporate debt


2



(2
)


192



(78
)


194



(80
)Total debt securities


8,454



(4,134
)


22,483



(5,988
)


30,937



(10,122
)Equity securities


1



(2
)


55



(20
)


56



(22
)Total temporarily impaired securities

$
8,455


$
(4,136
)

$
22,538


$
(6,008
)

$
30,993


$
(10,144
)   available-for-sale
  (dollars in millions)Successor CompanyAvailable-for-Sale

Held-to-MaturityAmortized

Fair

Amortized

FairCost

Value

Cost

ValueDue in one year or less

$
626


$
601


$
-


$
-Due after one year through five years


7,680



7,714



-



-Due after five years through ten years


7,910



8,124



246



246Due after ten years


511



379



-



-Total(1)

$
16,727


$
16,818


$
246


$
246  (1)
    
    Actual maturities may differ
    from contractual maturities because borrowers may have the right
    to call or prepay their obligations with or without prepayment
    penalties.  available-for-sale
  (dollars in millions)Successor Company


Predecessor CompanyYear Ended


Year Ended

Year EndedDecember 31,
    2009


December 26,
    2008

December 28,
    2007Proceeds(1)

$
13,715



$
29,537


$
39,327Gross realized gains


608




33



224Gross realized losses


(93
)



(28
)


(55
)  (1)
    
    Includes approximately
    $2.4 billion related to the sale of MLBUSA and MLBT-FSB to
    Bank of America during 2009. 96




---



##### Table of Contents



Equity
    Method Investments
    (dollars in millions)Successor Company


Predecessor CompanyDecember 31, 2009


December 26, 2008Carrying

Ownership


Carrying

OwnershipAmount

Percentage


Amount

PercentageBlackRock,
    Inc.(1)

$
9,978



34
%


$
8,000



50
%Warburg Pincus Funds IX and X,
    L.P.(2)


797



7




651



7WCG Master
    Fund Ltd.(3)


598



25




998



31  (1)
    
    Carrying amount includes a 4%
    voting common equity interest and a non-voting preferred equity
    interest as of December 31, 2009 and a 44% voting common
    equity interest and a non-voting preferred equity interest at
    December 26, 2008.(2)
    
    Investment in private equity
    funds.(3)
    
    Investment in an alternative
    investment fund.        (dollars in millions)For the Year Ended

For the Year Ended

For the Year EndedDecember 31,
    2009

December 26,
    2008(1)

December 28,
    2007(2)Revenues

$
6,576


$
6,513


$
11,725Operating income


2,774



761



4,726Earnings/(loss) before income taxes


2,768



(7
)


4,692Net earnings/(loss)


2,371



(308
)


4,107   97




---



##### Table of Contents



(dollars in millions)December 31,
    2009

December 26,
    2008Total assets

$
198,551


$
60,628Total liabilities


158,981



34,396Noncontrolling interest


273



869  (1)
    
    Results relating to the
    investment in Bloomberg L.P. reflect amounts through
    June 30, 2008, as the investment was sold on July 17,
    2008.(2)
    
    Does not include summarized
    financial information for Warburg Pincus Fund X,
    L.P.  Note 9.  Securitization Transactions and
    Transactions with Variable Interest Entities
    (VIEs)    and/or
    
    Retaining or holding an interest in the VIE,
    Providing liquidity or other support to the VIE or directly to
    the investors in the VIE. This includes liquidity facilities,
    guarantees, and derivatives that absorb the risk of the assets
    in the VIE, including total return swaps and written credit
    default swaps,
    Servicing the assets in the VIE, and
    Acting as counterparty to derivatives that do not absorb the
    risk of the assets in the VIE. These include derivatives that
    introduce risk into the VIE such as credit default swaps where
    the VIE takes credit risk (generally found in credit-linked note
    structures) or equity derivatives where the VIE takes equity
    risk (generally found in equity-linked note structures);
    however, Merrill Lynch excludes transactions where it only acts
    as counterparty to interest rate or foreign exchange derivatives.      Primary Beneficiary
  Sponsor/Significant VIH
 98




---



##### Table of Contents



Securitization transactions
    Loan and
    Real Estate VIEs
          Equity
    Funds
   99




---



##### Table of Contents



Credit-Linked
    Note and Other VIEs
  and/or
  U.S. sub-prime
    Collateralized
    Debt Obligations/Collateralized Loan Obligations
    (CDOs/CLOs)
    Municipal
    Bond Securitizations
   100




---



##### Table of Contents



and/or
  Variable
    Interest Entities
   101




---



##### Table of Contents



(dollars in millions)Assets After Intercompany

Liabilities After

MaximumConsolidated VIEs



Eliminations

Intercompany

ExposureType of VIE

Total Assets

Unrestricted

Restricted(1)

Eliminations

to
    Loss(2)Successor CompanyDecember 31, 2009Loan and real estate
    VIEs(3)

$
3,442


$
494


$
2,588


$
1,171


$
2,209Equity
    Funds(4)


96



-



59



50



59Credit-linked note and other
    VIEs(5)


1,698



310



858



45



1,057CDOs/CLOs(6)


2,785



-



337



2,753



2,449Municipal
    Bonds(7)


138



138



-



2



138Predecessor CompanyDecember 26, 2008Loan and real estate
    VIEs(3)

$
9,080


$
2,475


$
2,680


$
4,769


$
3,479Equity
    Funds(4)


473



3



119



230



116Credit-linked note and other
    VIEs(5)


1,643



1,221



-



45



45CDOs/CLOs(6)


693



-



360



489



237  (1)
    
    Assets are considered
    restricted when they cannot be freely pledged or sold by Merrill
    Lynch.(2)
    
    This column reflects Merrill
    Lynchs maximum exposure to loss associated with the VIE.
    It includes the value of on balance sheet assets plus the
    maximum exposure associated with off balance sheet instruments
    (e.g., total return swaps) less any liabilities where the
    investors do not have recourse to Merrill Lynch.(3)
    
    For Loan and real estate VIEs,
    assets are primarily recorded in loans, notes and mortgages.
    Assets related to VIEs that hold real estate investments are
    included in other assets. Liabilities are primarily recorded in
    short and long-term borrowings.(4)
    
    For Equity funds, assets are
    recorded in trading assets and liabilities are recorded in
    long-term borrowings.(5)
    
    For CLNs and other VIEs, assets
    are recorded in trading assets and investment securities and
    liabilities are recorded in long-term borrowings.(6)
    
    For CDOs/CLOs, assets are
    primarily recorded in trading assets and liabilities are
    recorded in long-term borrowings. Certain consolidated CDOs are
    established to provide full recourse secured financing to
    Merrill Lynch.(7)
    
    For Municipal bonds, assets are
    recorded in trading assets.   102




---



##### Table of Contents



(dollars in millions)Assets on Merrill

Liabilities on

MaximumSponsor/Significant VIH



Lynchs Balance

Merrill Lynchs

ExposureType of VIE

Size of
    VIE(1)

Sheet(2)

Balance
    Sheet(2)

to
    Loss(3)Successor CompanyDecember 31, 2009Loan and real estate
    VIEs(4)

$
733


$
257


$
-


$
257Equity
    Funds(5)


2,658



322



614



322Credit-linked note and other
    VIEs(6)


10,923



4,146



1,084



8,165CDOs/CLOs(7)


51,017



2,951



801



5,942Predecessor CompanyDecember 26, 2008Loan and real estate
    VIEs(4)

$
1,761


$
712


$
61


$
712Equity
    Funds(5)


2,898



312



537



312Credit-linked note and other
    VIEs(6)


13,257



6,889



986



10,452CDOs/CLOs(7)


59,475



3,584



344



8,155  (1)
    
    Size generally reflects the
    estimated principal of securities issued by the VIE or the
    principal of the underlying assets held by the VIE and serves to
    provide information on the relative size of the VIE as compared
    with Merrill Lynchs involvement with the VIE.(2)
    
    Assets and Liabilities on
    Merrill Lynchs Balance Sheet reflect the effect of
    netting, if applicable.(3)
    
    The maximum exposure to loss
    includes: the assets held by Merrill Lynch, including the value
    of derivatives that are in an asset position, and the notional
    amount of liquidity and other support provided to VIEs generally
    through total return swaps over the assets of the VIE. The
    maximum exposure to loss for liquidity and other support assumes
    a total loss on the referenced assets held by the VIE.(4)
    
    Loan and real estate VIE assets
    primarily include loans recorded in loans, notes and mortgages
    and derivatives recorded in trading assets. Liabilities include
    derivatives recorded in trading liabilities.(5)
    
    Equity fund assets include cash
    instruments and derivatives recorded in trading assets.
    Liabilities are recorded in payables under repurchase agreements
    in instances where assets were transferred but the transfer did
    not meet the sale requirements of Financial Transfers and
    Servicing Accounting, or trading liabilities for
    derivatives.(6)
    
    CLN and other VIE assets
    include derivatives and are recorded in trading assets.
    Liabilities are recorded in payables under repurchase agreements
    in instances where assets were transferred but the transfer did
    not meet the sale requirements of Financial Transfers and
    Servicing Accounting, or trading liabilities for derivatives. In
    certain transactions, Merrill Lynch enters into total return
    swaps over assets held by the VIEs. Maximum exposure to loss
    represents the sum of the notional amount of these derivatives
    and the value of any assets on Merrill Lynchs balance
    sheet.(7)
    
    CDO/CLO assets and liabilities
    are primarily derivatives recorded in trading
    assets/liabilities.  Securitizations
  and/or
 103




---



##### Table of Contents



and/or
    (dollars in millions)SecuritizationTransactions









Year-to-dateSize/Principal

Assets on

Liabilities on

Maximum

(Loss) on

CashType of Entity

Outstanding(1)

Balance
    Sheet(2)

Balance
    Sheet(2)

Exposure to
    Loss(3)

Sale

FlowsSuccessor CompanyDecember 31, 2009QSPEs:Residential Mortgage
    Loans(4)

$
34,219


$
1,233


$
135


$
1,242


$
-


$
245Municipal
    Bonds(5)


5,264



97



287



4,971



-



951Commercial Loans and
    Other(6)


9,589



198



10



198



-



22Non-QSPEs:Loan and real estate
    VIEs(7)


10,442



6,723



-



6,784



-



491Predecessor CompanyDecember 26, 2008QSPEs:Residential Mortgage
    Loans(4)

$
78,162


$
1,667


$
207


$
1,654


$
-


$
10,141Municipal
    Bonds(5)


9,377



487



674



8,644



-



5,824Commercial Loans and
    Other(6)


18,366



288



-



288



-



1,091Non-QSPEs:Loan and real estate
    VIEs(7)


10,182



6,757



-



6,757



(22
)


3,035  (1)
    
    Size/Principal Outstanding
    reflects the estimated principal of the underlying assets held
    by the VIE/SPEs.(2)
    
    Assets and Liabilities on
    Merrill Lynchs Balance Sheet reflect the effect of Balance
    Sheet-Offsetting Accounting, if applicable.(3)
    
    The maximum exposure to loss
    includes the following: the assets held by Merrill Lynch,
    including the value of derivatives that are in an asset position
    and retained interests in the VIEs/SPEs; and the notional amount
    of liquidity and other support generally provided through total
    return swaps. The maximum exposure to loss for liquidity and
    other support assumes a total loss on the referenced assets held
    by the VIE.(4)
    
    Residential mortgage loan QSPE
    assets primarily include servicing advances recorded in other
    assets and cash instruments recorded in investment securities
    and trading assets. Liabilities include derivatives recorded in
    trading liabilities.(5)
    
    Municipal bond QSPE assets
    include cash instruments recorded in trading assets and
    investment securities. Liabilities include derivatives recorded
    in trading liabilities. At December 31, 2009 and
    December 26, 2008, the carrying value of the liquidity and
    other support related to these transactions was
    $287 million and $674 million, respectively.(6)
    
    Commercial loans and other
    QSPEs primarily include commercial mortgage securitizations.
    Assets include cash instruments and derivatives, primarily
    recorded in trading assets. Liabilities include derivatives
    recorded in trading liabilities.(7)
    
    Loan and real estate entity
    assets are recorded in loans, notes and mortgages and relate to
    asset-backed financing arrangements, which include the sale of
    U.S. super senior ABS CDOs in 2008 to an affiliate of Lone Star
    Funds.  and/or
 104




---



##### Table of Contents



available-for-sale,
  available-for-sale
      Municipal(dollars in millions)

BondsRetained interest amount

$
97Weighted average credit losses (rate per
    annum)(1)


0.0
%Weighted average discount rate


6.96
%Impact on fair value of 100 bps decrease in discount rate

$
59Impact on fair value of 200 bps decrease in discount rate

$
139Impact on fair value of 100 bps increase in discount rate

$
(18
)Impact on fair value of 200 bps increase in discount rate

$
(26
)Weighted average life (in years)


-Weighted average prepayment speed
    (CPR)(2)


0.0
%  CPR=Constant Prepayment Rate
 (1)
    
    Credit losses are computed only
    on positions for which expected credit loss is either a key
    assumption in the determination of fair value or is not
    reflected in the discount rate.(2)
    
    Relates to select
    securitization transactions where assets are prepayable. Merrill
    Lynch does not hold any retained interest where the underlying
    assets are prepayable.   105




---



##### Table of Contents



Note 10.  Loans, Notes, Mortgages and Related
    Commitments to Extend Credit    
    Consumer loans, which are substantially secured, including
    residential mortgages, home equity loans, and other loans to
    individuals for household, family, or other personal
    expenditures; and
    Commercial loans including corporate and institutional loans
    (including corporate and financial sponsor, non-investment grade
    lending commitments), commercial mortgages, asset-based loans,
    small- and middle-market business loans, and other loans to
    businesses.    (dollars in millions)Loans

Commitments(1)Successor


Predecessor

Successor


PredecessorCompany


Company

Company


CompanyDecember 31,


December 26,

December 31,


December 26,2009


2008

2009(2)(3)


2008Consumer:Mortgages

$
4,700



$
29,397


$
167



$
8,269Other


8,969




1,360



20




2,582Commercial and small- and middle-market business:Investment grade


11,105




17,321



6,187




28,269Non-investment grade


12,922




23,184



4,170




9,29137,696




71,262



10,544




48,411Allowance for loan losses


(33
)



(2,072
)


-




-Reserve for lending-related
    commitments(4)


-




-



(825
)



(2,471
)Total, net

$
37,663



$
69,190


$
9,719



$
45,940  (1)
    
    Commitments are outstanding as
    of the date the commitment letter is issued and are comprised of
    closed and contingent commitments. Closed commitments represent
    the unfunded portion of existing commitments available for draw
    down. Contingent commitments are contingent on the borrower
    fulfilling certain conditions or upon a particular event, such
    as an acquisition. A portion of these contingent commitments may
    be syndicated among other lenders or replaced with capital
    markets funding.(2)
    
    See Note 14 for a maturity
    profile of these commitments.(3)
    
    In addition to the loan
    origination commitments included in the table above, Merrill
    Lynch had agreements to purchase $338 million of loans
    that, upon settlement of the commitment, will be classified in
    loans held for investment and loans held for sale. See
    Note 14 for additional information.(4)
    
    Amounts are included within
    other payables on the Consolidated Balance Sheets. 106




---



##### Table of Contents



(dollars in millions)Successor


PredecessorCompany


CompanyYear Ended


Year EndedDecember 31,
    2009


December 26,
    2008Allowance for loan losses, at beginning of
    period(1)

$
-



$
533Provision for loan losses


394




1,886Charge-offs


(212
)



(360
)Recoveries


8




14Net charge-offs


(204
)



(346
)Other(2)


(157
)



(1
)Allowance for loan losses, at end of period

$
33



$
2,072  (1)
    
    The allowance for loan losses
    as of December 26, 2008 was eliminated as of
    January 1, 2009 as a result of purchase accounting
    adjustments.(2)
    
    The amount for 2009 includes
    $157 million of allowance for loan losses transferred to
    Bank of America in connection with the sale of MLBUSA and
    MLBT-FSB. See Note 2 for further information regarding
    these sales.         107




---



##### Table of Contents



Net
    Credit Default Protection by Maturity Profile
  December 31,2009Less than or equal to one year


3
%Greater than one year and less than or equal to five years


86Greater than five years


11Total net credit default protection


100
%   Net
    Credit Default Protection by Credit Exposure Debt
    Rating
  (dollars in millions)December 31, 2009NetRatings(1)

Notional

PercentAA

$
(465
)


14.6
%A


(1,183
)


37.1BBB


(686
)


21.6BB


(406
)


12.8B


(158
)


5.0CCC and below


(244
)


7.7Not rated


(39
)


1.2Total net credit default protection

$
(3,181
)


100.0
%  (1)
    
    Merrill Lynch considers ratings
    of BBB- or higher to meet the definition of investment
    grade.    
    Negative amortizing features that permit the borrower to draw on
    unfunded commitments to pay current interest (commercial loans
    only); 108




---



##### Table of Contents




    Subject the borrower to payment increases over the life of the
    loan; and
    High Loan to Value (LTV) ratios.      (dollars in millions)Successor Company


Predecessor CompanyDecember 31,
    2009(1)


December 26,
    2008(2)Loans with negative amortization features

$
87



$
229Loans where borrowers may be subject to payment
    increases(3)


819




22,041Loans with high LTV ratios


1,738




1,490Loans with both high LTV ratios and loans where borrowers may be
    subject to payment increases


1,377




4,101  (1)
    
    The decreases from
    December 26, 2008 primarily reflected the sale of MLBUSA
    and MLBT-FSB to Bank of America in 2009.(2)
    
    Includes loans from
    securitizations where due to Merrill Lynchs inability to
    sell certain securities, the VIEs were not considered QSPEs
    thereby resulting in Merrill Lynchs consolidation of the
    VIEs. Merrill Lynchs exposure is limited to (i) any
    retained interest (see Note 9) and (ii) the
    representations and warranties made upon securitization (see
    Note 14).(3)
    
    The balance at
    December 26, 2008 included $10.2 billion of prime
    residential mortgage loans with low LTV ratios that were
    acquired or originated in connection with the acquisition of
    First Republic, which was a subsidiary of MLBT-FSB.    and/or
  sm
  Effect of
    the Acquisition of Merrill Lynch by Bank of America
   109




---



##### Table of Contents



MLBT-FSB
  (dollars in millions)As ofJanuary 1,Acquired Impaired
    Loans

2009Contractually required payments including interest

$
6,205Less: Nonaccretable difference


(1,357
)Cash flows expected to be
    collected(1)


4,848Less: Accretable yield


(627
)Fair value of loans acquired

$
4,221  (1)
    
    Represents undiscounted
    expected principal and interest cash flows at the acquisition
    date (January 1, 2009). 110




---



##### Table of Contents



(dollars in millions)Year EndedDecember 31,2009Accretable yield, beginning of period

$
627Impact of the sale of MLBUSA and MLBT-FSB to Bank of America


(499
)Accretions


(109
)Disposals


(8
)Decrease in expected cash flows


(11
)Accretable yield, December 31, 2009

$
-  Note 11.  Goodwill and Intangible Assets    Goodwill
  Intangibles  Goodwill and
    Other,
    (dollars in millions)Predecessor CompanyGoodwill, December 26,
    2008(1)

$
2,221Successor
    Company(2)Goodwill, January 1, 2009

$
5,044Dispositions(3)


(425
)Purchase Accounting
    Adjustments(4)


(29
)Goodwill, December 31, 2009

$
4,590  (1)
    
    Predecessor Company goodwill as
    of December 26, 2008 was eliminated as of January 1,
    2009 as a result of purchase accounting adjustments.(2)
    
    Refer to Note 2 for
    further information.(3)
    
    Relates to the sale of MLBUSA
    and MLBT-FSB to Bank of America during 2009. Refer to
    Note 2 for further information.(4)
    
    Represents adjustments to the
    preliminary purchase accounting established as of
    January 1, 2009 in conjunction with the acquisition of
    Merrill Lynch by Bank of America. 111




---



##### Table of Contents



Intangible
    Assets
  Property, Plant and Equipment
    (dollars in millions)Successor


PredecessorCompany


CompanyDecember 31,


December 26,2009


2008Customer relationships

Gross Carrying Amount

$
3,087



$
295Accumulated amortization


(309
)



(87
)Net carrying amount


2,778




208Core deposits

Gross Carrying Amount


-




194Accumulated amortization


-




(52
)Net carrying amount


-




142Other(1)

Gross Carrying Amount


1,515




122Accumulated amortization


-




(77
)Net carrying amount


1,515




45Total

Gross Carrying Amount


4,602




611Accumulated amortization


(309
)



(216
)Net carrying amount

$
4,293



$
395  (1)
    
    Other is primarily related to
    the Merrill Lynch brand in 2009 and trademarks and technology in
    2008.     112




---



##### Table of Contents



Note 12.  Borrowings and Deposits        
    As a result of the acquisition by Bank of America, all debt
    instruments were adjusted to their fair value on January 1,
    2009;
    Certain debt issuances are accounted for at fair value and
    incorporate changes in Merrill Lynchs creditworthiness as
    well as other underlying risks (see Note 4);
    Certain structured notes whose coupon or repayment terms are
    linked to the performance of debt and equity securities,
    indices, currencies or commodities reflect the fair value of
    those risks; and
    Certain debt issuances are adjusted for the impact of fair value
    hedge accounting (see Note 6). 113




---



##### Table of Contents



(dollars in millions)Successor Company


Predecessor CompanyDecember 31,


December 26,2009


2008Senior debt


$
89,251



$
152,213Senior structured notes



49,187




58,589Subordinated debt



11,115




13,317Junior subordinated notes (related to trust preferred securities)



3,552




5,256Other subsidiary financing



2,699




13,454Total


$
155,804



$
242,829     (dollars in millions)Successor Company


Predecessor CompanyDecember 31,


December 26,2009


2008Short-term borrowingsCommercial
    paper(1)

$
-



$
20,104Secured short-term
    borrowings(2)


-




14,137Other unsecured short-term borrowings


853




3,654Total

$
853



$
37,895Long-term
    borrowings(3)Fixed-rate
    obligations(4)

$
74,131



$
101,403Variable-rate
    obligations(5)(6)


77,252




96,511Other obligations and Zero-coupon contingent convertible debt
    (LYONs®)


16




1,764Total

$
151,399



$
199,678DepositsU.S.(7)

$
-



$
79,528Non-U.S.


15,187




16,579Total

$
15,187



$
96,107  (1)
    
    The decrease in commercial
    paper from December 26, 2008 reflects the repayment of
    borrowings under the Federal Reserves liquidity backstop
    for U.S. issuers of commercial paper and the FDICs
    Temporary Liquidity Guarantee Program.(2)
    
    2008 balance included
    borrowings from Federal Home Loan Banks and borrowings under a
    secured bank credit facility.(3)
    
    Excludes junior subordinated
    notes (related to trust preferred securities).(4)
    
    Fixed-rate obligations are
    generally swapped to variable rates.(5)
    
    Variable interest rates are
    generally based on rates such as LIBOR, the U.S. Treasury Bill
    Rate, or the Federal Funds Rate.(6)
    
    Includes structured
    notes.(7)
    
    The reduction in U.S. deposits
    from December 26, 2008 reflects the sale of MLBUSA and
    MLBT-FSB to Bank of America during 2009.   114




---



##### Table of Contents



Successor Company


Predecessor CompanyDecember 31,


December 26,2009


2008Short-term borrowings


2.04
%



2.95
%Long-term borrowings


3.73




4.65Junior subordinated notes (related to trust preferred securities)


6.93




6.83   Long-Term
    Borrowings
    (dollars in millions)Less than 1 year

$
31,680



21
%1  2 years


19,867



132+ 

    3 years


18,760



123+ 

    4 years


21,246



144+ 

    5 years


17,210



11Greater than 5 years


42,636



29Total

$
151,399



100
%         Floating Rate LYONs
   115




---



##### Table of Contents



Junior
    Subordinated Notes (related to trust preferred
    securities)
        (dollars in millions)AGGREGATEPRINCIPALAMOUNT

AGGREGATEOF TRUST

PRINCIPAL

ANNUAL



EARLIESTISSUE

PREFERRED

AMOUNT

DISTRIBUTION

STATED

REDEMPTIONTRUST

DATE

SECURITIES

OF NOTES

RATE

MATURITY

DATEML Preferred
    Capital Trust III

Jan1998

$
750


$
900



7.00
%

Perpetual

Mar2008ML Preferred
    Capital Trust IV

Jun1998


400



480



7.12


Perpetual

Jun2008ML Preferred
    Capital Trust V

Nov1998


850



1,021



7.28


Perpetual

Sep2008ML Capital Trust I

Dec2006


1,050



1,051



6.45


Dec2066(1)

Dec2011ML Capital Trust II

May2007


950



951



6.45


Jun2062(2)

Jun2012ML Capital Trust III

Aug2007


750



751



7.375


Sep2062(3)

Sep2012Total



$
4,750(4
)

$
5,154  (1)
    
    Merrill Lynch has the option to
    extend the maturity of the junior subordinated note until
    December 2086.(2)
    
    Merrill Lynch has the option to
    extend the maturity of the junior subordinated note until June
    2087.(3)
    
    Merrill Lynch has the option to
    extend the maturity of the junior subordinated note until
    September 2087.(4)
    
    Includes related investments of
    $25 million.  Committed Credit Facilities
   116




---



##### Table of Contents



Deposits
    (dollars in millions)Successor Company


Predecessor CompanyDecember 31,


December 26,2009


2008U.S.Savings and Demand
    Deposits(1)

$
-



$
71,377Time Deposits


-




8,151Total U.S.
    Deposits(2)


-




79,528Non-U.S.Non-interest bearing


1,104




664Interest bearing


14,083




15,915Total
    Non-U.S.
    Deposits


15,187




16,579Total Deposits

$
15,187



$
96,107  (1)
    
    Includes $1.9 billion of
    non-interest bearing demand deposits at December 26,
    2008.(2)
    
    The reduction in U.S. deposits
    from December 26, 2008 reflects the sale of MLBUSA and
    MLBT-FSB to Bank of America during 2009.      Other
   Note 13.  Stockholders Equity and
    Earnings Per Share  Preferred
    Equity
    Mandatory
    Convertible
   117




---



##### Table of Contents



Common
    Stock
     118




---



##### Table of Contents



Accumulated
    Other Comprehensive Loss
    (dollars in millions)Successor Company


Predecessor CompanyDecember 31,


December 26,2009


2008Foreign currency translation adjustmentNet unrealized losses

$
(597
)


$
(942
)Income taxes


691




197Total


94




(745
)Unrealized gains/(losses) on investment securities
    available-for-saleNet unrealized gains/(losses)


105




(10,099
)Income taxes


(58
)



4,061Total


47




(6,038
)Deferred gains on cash flow hedgesDeferred gains


1




135Income taxes


(1
)



(54
)Total


-




81Defined benefit pension and postretirement plansNet actuarial (losses)/gains


(417
)



538Net prior service cost


-




66Foreign currency translation gain


-




53Adjustment to apply change in measurement date


-




2Income taxes


164




(275
)Total


(253
)



384Total accumulated other comprehensive loss

$
(112
)


$
(6,318
)  119




---



##### Table of Contents



Earnings
    Per Share
    (dollars in millions, except per share amounts)Successor Company


Predecessor CompanyYear Ended


Year Ended

Year EndedDecember 31,


December 26,

December 28,2009


2008

2007Net earnings/(loss) from continuing operations

$
4,736



$
(27,551
)

$
(8,637
)Net (loss)/earnings from discontinued operations


-




(61
)


860Preferred stock dividends


(153
)



(2,869
)


(270
)Net earnings/(loss) applicable to common
    shareholders  for basic EPS

$
4,583



$
(30,481
)

$
(8,047
)Net earnings/(loss) applicable to common
    shareholders  for diluted
    EPS(1)

$
4,583



$
(30,481
)

$
(8,047
)(shares in thousands)Weighted-average basic shares
    outstanding(2)N/A




1,225,611



830,415Effect of dilutive instruments


N/A




-



-Diluted
    Shares(3)


N/A




1,225,611



830,415Basic EPS from continuing operations


N/A



$
(24.82
)

$
(10.73
)Basic EPS from discontinued operations


N/A




(0.05
)


1.04Basic EPS


N/A



$
(24.87
)

$
(9.69
)Diluted EPS from continuing operations


N/A



$
(24.82
)

$
(10.73
)Diluted EPS from discontinued operations


N/A




(0.05
)


1.04Diluted EPS


N/A



$
(24.87
)

$
(9.69
)Common shares outstanding at period end


1




1,600,253



936,040  N/A Earnings per share data is not provided for the year
    ended December 31, 2009 as Merrill Lynch was a wholly-owned
    subsidiary of Bank of America during that period.
 (1)
    
    Due to the net loss for the year ended December 26,
    2008, inclusion of the incremental shares on the Mandatory
    Convertible Preferred Stock would be antidilutive and,
    therefore, those shares have not been included as part of the
    Diluted EPS calculation. See Mandatory Convertible section above
    for additional information.(2)
    
    Includes shares exchangeable into common stock in 2008 and
    2007.(3)
    
    Due to the net loss for the years ended December 26,
    2008 and December 28, 2007, the Diluted EPS calculation
    excluded 585 million and 192 million instruments,
    respectively, as they were antidilutive.   120




---



##### Table of Contents



Note 14.  Commitments, Contingencies and
    Guarantees  Litigation
    and/or and/or
    Specific
    Litigation
  Adelphia
    Litigation
  Adelphia Recovery Trust v. Bank of
    America, N.A., et al
  Auction
    Rate Litigation
  Burton v. Merrill Lynch & Co., Inc., et al., Stanton v. Merrill
    Lynch & Co., Inc., et al., In Re Merrill Lynch Auction
    Rate Securities Litigation
 121




---



##### Table of Contents



Mayor and City Council of Baltimore Maryland v.
    Citigroup, Inc., et al. Russell Mayfield, et
    al. v. Citigroup, Inc., et al.: City Council of Baltimore Mayfield
    Bank Sweep Programs Litigation
  DeBlasio v. Merrill Lynch, et al.:
    Bank of America Merger Matters
  In re Bank of America
    Securities, Derivative and Employment Retirement Income Security
    Act (ERISA) Litigation
 122




---



##### Table of Contents



Iron Workers of Western
    Pennsylvania Pension Plan v. Bank of America Corp., et
    al. In re Bank of America Securities,
    Derivative and Employment Retirement Income Security Act (ERISA)
    Litigation
  Dornfest v. Bank of America Corp., et al. In re Bank of America Securities, Derivative and Employment
    Retirement Income Security Act (ERISA) Litigation
  Benistar
  Gail A. Cahaly, et al. v. Benistar Property Exchange
    Trust Company, Inc, et al.:
 123




---



##### Table of Contents



Enron Litigation
  Newby v. Enron Corp.
    et al.,
  Illinois Funeral Directors Association Matters
  and/or pre-need
  Fred C. Dames
    Funeral Homes, Inc., et al., v. Daniel W. Hynes, the
    Illinois Office of the Comptroller, et al.,
  Calvert Funeral Homes Ltd., et al. v. Robert W. Ninker,
    et al.,
  David Tipsword
    as Trustee of Mildred E. Tipsword Trust, individually and on
    behalf of all others
 124




---



##### Table of Contents



similarly situated v. I.F.D.A. Services Inc., et al.,
  Clancy-Gernon Funeral
    Home, Inc., et al. v. MLPF&S, et al., Clancy-Gernon Tipsword Tipsword
  IndyMac
  IBEW Local
    103 v. Indymac MBS et al.,
  Police & Fire
    Retirement System of the City of Detroit v. IndyMac MBS,
    Inc., et al. Wyoming State Treasurer, et al. v.
    John Olinski, et al., IBEW Local 103
  Police & Fire Retirement
    System of the City of Detroit v. IndyMac MBS, Inc., et al. Wyoming State Treasurer, et al. v. John Olinski,
    et al., successor-in-interest IBEW Local 103 v. IndyMac MBS et al.
  In re
    Initial Public Offering Securities Litigation
   125




---



##### Table of Contents



In re Initial Public Offering Securities Litigation
  Lehman
    Brothers Litigation
  In re
    Lehman Brothers Securities and ERISA Litigation
  Lyondell
    Litigation
  Official Committee of Unsecured Creditors v. Citibank,
    N.A., et al., In re
    Lyondell Chemical Company, et al
  The Wilmington Trust Co. v. LyondellBasell
    Industries AF S.C.A., et al.,
   126




---



##### Table of Contents



MBIA
    Insurance Corporation CDO Litigation
  MBIA Insurance Corporation and LaCrosse Financial Products,
    LLC v. Merrill Lynch Pierce Fenner and Smith Inc., and
    Merrill Lynch International:
  Mediafiction
    Litigation
    Municipal
    Derivatives Litigation
  In re Municipal Derivatives Antitrust
    Litigation: In re Municipal Derivatives Antitrust Litigation
  In re Municipal
    Derivatives Antitrust Litigation
 127




---



##### Table of Contents



In re Municipal Derivatives
    Antitrust Litigation
  Region of
    Puglia, Italy Criminal Investigation
      Subprime
    Mortgage-Related Litigation
  In re Merrill Lynch & Co., Inc. Securities,
    Derivative, and ERISA Litigation:
    N.A.
    Lambrecht v. ONeal, et al
  Louisiana
    Sheriffs Pension & Relief Fund v. Conway,
    et al.
   128




---



##### Table of Contents



In re Merrill Lynch & Co., Inc. Securities,
    Derivative, and ERISA Litigation Louisiana Sheriffs
  Connecticut Carpenters Pension Fund, et al. v. Merrill
    Lynch & Co., Inc., et al.; Iron Workers Local
    No. 25 Pension Fund v. Credit-Based Asset Servicing
    and Securitization LLC, et al.; Public Employees Ret.
    System of Mississippi v. Merrill Lynch & Co.
    Inc.; Wyoming State Treasurer v. Merrill Lynch &
    Co. Inc.: Public Employees Ret.
    System of Mississippi v. Merrill Lynch & Co. Inc.
  Federal Home Loan Bank of Seattle Litigation: Federal
    Home Loan Bank of Seattle v. Countrywide Securities
    Corporation, et al. Federal Home Loan
    Bank of Seattle v. Merrill Lynch, Pierce,
    Fenner & Smith, Inc., et al.
  sub-prime
 129




---



##### Table of Contents



Commitments
    (dollars in millions)Commitment expirationLess than

1-3

3-5

Over 5Total

1 year

years

years

yearsLending commitments

$
10,544


$
2,398


$
6,190


$
1,855


$
101Purchasing and other commitments


5,744



2,544



1,536



661



1,003Operating leases


3,487



753



1,248



735



751Commitments to enter into forward dated resale and securities
    borrowing agreements


51,837



51,837



-



-



-Commitments to enter into forward dated repurchase and
    securities lending agreements


58,272



58,272



-



-



-Total

$
129,884


$
115,804


$
8,974


$
3,251


$
1,855   Lending
    Commitments
        Purchasing
    and Other Commitments
     130




---



##### Table of Contents



Operating
    Leases
      (dollars in millions)

WFC(1)

Other

Total2010

$
208


$
546


$
7542011


190



477



6672012


190



391



5812013


140



337



4772014


-



257



2572015 and thereafter


-



751



751Total

$
728


$
2,759


$
3,487  (1)
    
    World Financial Center, New
    York.      (dollars in millions)Successor Company


Predecessor CompanyDecember 31,


December 26,


December 28,2009


2008


2007Rent expense


$
789



$
837



$
762Sublease revenue



(145
)



(189
)



(190
)Net rent expense


$
644



$
648



$
572   Guarantees
    (dollars in millions)ExpirationMaximum

Less than







CarryingPayout

1 year

1 - 3 years

3 - 5 years

Over 5 years

ValueStandby liquidity facilities

$
4,906


$
2,124


$
-


$
2,750


$
32


$
304Auction rate security guarantees


198



198



-



-



-



24Residual value guarantees


416



-



96



320



-



-Standby letters of credit and other guarantees


26,645



894



156



71



25,524



324  131




---



##### Table of Contents



Standby
    Liquidity Facilities
    (dollars in millions)Merrill Lynch Liquidity Facilities Can Be Drawn:Municipal Bonds to WhichIn 7 Days with

In 7 Days with

After 7 and Up



Merrill Lynch Has RecourseNet Liquidity

Gross Liquidity

to 364
    Days(1)

Total

if Facilities Are DrawnMerrill Lynch provides standby liquidity facilities

$
1,343


$
781


$
2,750


$
4,874


$
4,842  (1)
    
    Initial liquidity support is
    provided by third parties within seven days, to be reimbursed by
    Merrill Lynch within 364 days.    ARS
    Guarantees
  not-for-profit,
 132




---



##### Table of Contents



Residual
    Value Guarantees
    Standby
    Letters of Credit and Other Guarantees
           133




---



##### Table of Contents



Note 15.  Employee Benefit Plans      715-20-50, Compensation-Retirement Benefits, Defined Benefit
    Plans-General Compensation-Nonretirement Postemployment Benefits
   134




---



##### Table of Contents



Defined
    Contribution Pension Plans
  non-U.S. defined
    catch-up
  non-U.S. plans
  Defined
    Benefit Pension Plans
   135




---



##### Table of Contents



non-U.S. subsidiaries non-U.S. pension
  Postretirement
    Benefits Other Than Pensions
  non-U.S. subsidiaries.
 136




---



##### Table of Contents



non-U.S. defined
  (dollars in millions)U.S. Defined

Non-U.S. Defined

Total DefinedBenefit

Benefit

Benefit

PostretirementPension Plans

Pension
    Plans(1)

Pension Plans

Plans(2)Successor

Predecessor

Successor

Predecessor

Successor

Predecessor

Successor

PredecessorCompany

Company

Company

Company

Company

Company

Company

Company2009

2008

2009

2008

2009

2008

2009

2008Benefit obligationsBalance, beginning of year

$
1,635


$
1,681


$
1,181


$
1,498


$
2,816


$
3,179


$
208


$
263Effect of purchase accounting


48



-



99



-



147



-



18



-Adjustment due to Change in Measurement Date


-



24



-



27



-



51



-



5Service cost


-



-



30



30



30



30



5



6Interest cost


98



97



76



79



174



176



13



15Net actuarial loss (gains)


46



(28
)


75



(103
)


121



(131
)


18



(57
)Employee contributions


-



-



2



3



2



3



-



-Benefits paid


(116
)


(139
)


(53
)


(45
)


(169
)


(184
)


(16
)


(17
)Curtailment and settlements


-



-



(3
)


(5
)


(3
)


(5
)


-



(1
)Other/foreign exchange


-



-



111



(303
)


111



(303
)


2



(6
)Balance, end of period


1,711



1,635



1,518



1,181



3,229



2,816



248



208Fair value of plan assetsBalance, beginning of year


2,659



2,261



1,025



1,263



3,684



3,524



-



-Actual return on plan assets


(235
)


438



177



21



(58
)


459



-



-Settlements


-



-



-



(4
)


-



(4
)


-



-Contributions


121



99



63



80



184



179



16



17Benefits paid


(116
)


(139
)


(53
)


(45
)


(169
)


(184
)


(16
)


(17
)Other/foreign exchange


104



-



100



(290
)


204



(290
)


-



-Balance, end of period


2,533



2,659



1,312



1,025



3,845



3,684



-



-Funded status end of period

$
822


$
1,024


$
(206
)

$
(156
)

$
616


$
868


$
(248
)

$
(208
)Amount recognized in Consolidated Balance Sheet

$
822


$
1,024


$
(206
)

$
(156
)

$
616


$
868


$
(248
)

$
(208
)Weighted average assumptions, December 31Discount rate


5.8
%


6.3
%


5.4
%


6.2
%










5.8
%


6.3
%Rate of compensation increase


N/A



N/A



4.7



4.6











N/A



N/AHealthcare cost trend
    rates:(3)Initial


N/A



N/A



N/A



N/A











8.1



9.0Long-term


N/A



N/A



N/A



N/A











5.0



5.0  (1)
    
    Primarily represents the U.K.
    pension plan, which accounts for 74% of the benefit obligation
    and 82% of the fair value of plan assets at December 31,
    2009.(2)
    
    Approximately 91% of the
    postretirement benefit obligation at December 31, 2009
    relates to the U.S. postretirement plan.(3)
    
    The healthcare cost trend rate
    is assumed to decrease gradually through 2017 and remain
    constant thereafter.  N/A Not applicable
   137




---



##### Table of Contents



(dollars in millions)U.S. Defined

Non-U.S. Defined

Total DefinedBenefit

Benefit

Benefit

PostretirementPension Plans

Pension Plans

Pension Plans

PlansSuccessor

Predecessor

Successor

Predecessor

Successor

Predecessor

Successor

PredecessorCompany

Company

Company

Company

Company

Company

Company

Company2009

2008

2009

2008

2009

2008

2009

2008Assets

$
830


$
1,033


$
1


$
11


$
831


$
1,044


$
-


$
-Liabilities


(8
)


(9
)


(207
)


(167
)


(215
)


(176
)


(248
)


(208
)Net amount recognized

$
822


$
1,024


$
(206
)

$
(156
)

$
616


$
868


$
(248
)

$
(208
)   non-U.S. plans
  (dollars in millions)U.S. Defined

Non-U.S.Benefit

Defined

Total DefinedPension

Benefit

BenefitPlans

Pension Plans

Pension PlansSuccessor

Predecessor

Successor

Predecessor

Successor

PredecessorCompany

Company

Company

Company

Company

Company2009

2008

2009

2008

2009

2008Plans with ABO in excess of plan assetsPBO

$
8


$
9


$
221


$
349


$
229


$
358ABO


8



9



214



301



222



310Fair value of plan assets


-



-



72



182



72



182Plans with PBO in excess of plan assetsPBO

$
8


$
9


$
1,473


$
349


$
1,481


$
358ABO


8



9



1,356



301



1,364



310Fair value of plan assets


-



-



1,266



182



1,266



182     (dollars in millions)Non-U.S.

TotalU.S. Defined

Defined

DefinedBenefit

Benefit

BenefitPension

Pension

Pension

PostretirementPlans

Plans

Plans

PlansNet actuarial loss/(gain)

$
429


$
(30
)

$
399


$
18  138




---



##### Table of Contents



(dollars in millions)U.S. Pension

Non-U.S. Pension

Total PensionPlans

Plans

PlansSuccessor



Successor



Successor

PredecessorCompany

Predecessor Company

Company

Predecessor Company

Company

Company2009

2008

2007

2009

2008

2007

2009

2008

2007Defined contribution pension plan cost

$
211


$
274


$
278


$
69


$
89


$
85


$
280


$
363


$
363Defined benefit pension plans:Service
    cost(1)


-



-



-



30



30



28



30



30



28Interest cost


98



97



96



76



79



81



174



176



177Expected return on plan assets


(148
)


(118
)


(117
)


(74
)


(82
)


(81
)


(222
)


(200
)


(198
)Amortization of (gains)/losses,prior service costs and other


-



(2
)


(4
)


-



12



31



-



10



27Recognized gain due to settlements and curtailments


-



-



-



(2
)


-



-



(2
)


-



-Total defined benefit plan (income)/cost


(50
)


(23
)


(25
)


30



39



59



(20
)


16



34Total net periodic benefit cost

$
161


$
251


$
253


$
99


$
128


$
144


$
260


$
379


$
397Weighted average assumptions used to determine net periodic
    benefit costDiscount rate


6.0
%


6.0
%


5.5
%


5.6
%


5.8
%


4.9
%Expected long-term return on plan assets


5.3



5.3



5.3



6.8



6.9



6.8Rate of compensation increase


N/A



N/A



N/A



4.6



4.7



4.5  (1)
    
    The U.S. plan was terminated in
    1988 and thus does not incur service costs. N/A=Not Applicable
    (dollars in millions)PostretirementPlansSuccessorCompany

Predecessor Company2009

2008

2007Service cost

$
4


$
5


$
7Interest cost


13



15



16Amortization of losses/(gains), prior service costs and other


1



(10
)


(6
)Cost of settlement events


-



(5
)


-Postretirement net periodic benefit cost

$
18


$
5


$
17Weighted average assumptions used to determine net periodic
    benefit costDiscount rate


6.0
%


6.0
%


5.5
%Healthcare cost trend rates:Initial


8.1



8.8



9.5Long-term


5.0



5.0



5.0    139




---



##### Table of Contents



Plan
    Assumptions
    non-U.S. pension non-U.S. Plans.
    (dollars in millions)1% Increase

1% DecreaseSuccessor

Predecessor

Successor

PredecessorCompany

Company

Company

Company2009

2008

2009

2008Effect on:Other postretirement benefits cost

$
2


$
2


$
(2
)

$
(2
)Accumulated benefit obligation


23



19



(20
)


(16
)   Investment
    Strategy and Asset Allocation
     140




---



##### Table of Contents



Defined Benefit Pension PlansU.S. Plans

Non-U.S. Plans2010 Target
    AllocationDebt securities


100
%


10  35
%Equity securities


-



20  50
%Real estate


-



0  15
%Other(1)


-



30  60
%  (1)
    
    Other consists primarily of
    hedge funds, private equity investments, swaps and real
    property.  Fair
    Value Measurements
      (dollars in millions)Fair Value Measurements UsingLevel 1

Level 2

Level 3

TotalMoney market and interest bearing cash

$
8


$
-


$
-


$
8U.S. Government and government agency obligations


1,038



752



-



1,790Corporate debt


-



421



-



421Asset-backed securities


-



267



-



267Common and collective trusts


-



26



-



26Common and preferred stocks


10



-



-



10Non-U.S. common collective trusts


-



289



-



289Non-U.S.
    equity securities


130



-



-



130Non-U.S.
    debt securities


268



357



-



625Non-U.S.
    other(1)


-



13



266



279Total Plan assets, at fair value

$
1,454


$
2,125


$
266


$
3,845  (1)
    
    Level 3 assets consist
    primarily of hedge funds, private equity investments, swaps, and
    real property.    (dollars in millions)Year Ended December 31, 2009Actual return on plan assetsBeginning

Still Held at the

Sold During

Purchases, Sales

Transfers Into/

EndingBalance

Reporting Date

the Period

and Settlements

Out of Level 3

BalanceNon-U.S.
    other securities

$
328


$
(100
)

$
-


$
38


$
-


$
266  141




---



##### Table of Contents



Estimated
    Future Benefit Payments
    (dollars in millions)Defined Benefit PensionPlans

Postretirement
    Plans(3)U.S.(1)

Non-U.S.(2)

Total

Gross Payments

Medicare Subsidy

Net Payments2010

$
108


$
49


$
157


$
21



3


$
182011


114



50



164



23



4



192012


120



52



172



24



4



202013


125



53



178



25



4



212014


129



55



184



26



4



222015 through 2019


675



293



968



135



24



111  (1)
    
    The U.S. defined benefit
    pension plan payments are primarily funded under the terminated
    plan annuity contract.(2)
    
    The U.K., Swiss and Japan
    pension plan payments represent approximately 57%, 12% and 12%,
    respectively, of the
    non-U.S.
    2010 expected defined benefit pension payments.(3)
    
    The U.S. postretirement plan
    payments, net of Medicare subsidy, represent approximately 94%
    of the total 2010 expected postretirement benefit
    payments.  Postemployment
    Benefits
   Note 16.  Employee Incentive Plans         142




---



##### Table of Contents



Equity
    Compensation Plans
        Restricted
    Shares and Units
   143




---



##### Table of Contents



Predecessor CompanyLTIC Plans

ECAP

ESCPRestricted

Restricted

Restricted

Restricted

RestrictedShares

Units

Shares

Shares

UnitsAuthorized for issuance at:December 26, 2008


660,000,000



N/A



104,800,000



75,000,000



N/ADecember 28, 2007


660,000,000



N/A



104,800,000



75,000,000



N/AAvailable for issuance
    at:(1)December 26, 2008


39,409,796



N/A



-



19,692,085



N/ADecember 28, 2007


63,164,095



N/A



10,825,078



28,601,214



N/AOutstanding at December 29, 2006


29,272,338



7,916,925



19,885



29,081,187



5,712,989Granted  2007


6,193,079



2,087,899



7,009



13,153,487



2,439,219Paid, forfeited, or released from contingencies


(13,895,368
)


(3,107,137
)


(2,919
)


(5,929,819
)


(2,170,943
)Outstanding at December 28, 2007


21,570,049



6,897,687



23,975



36,304,855



5,981,265Granted  2008


506,412



12,094,494



6,732



-



36,545,501Paid, forfeited, or released from contingencies


(13,351,660
)


(4,582,512
)


(12,576
)


(27,373,905
)


(8,104,569
)Outstanding at December 26, 2008


8,724,801



14,409,669



18,131



8,930,950



34,422,197  N/A = Not Applicable
 (1)
    
    Includes shares reserved for
    issuance upon the exercise of stock options.  Successor CompanyRestrictedShares/UnitsOutstanding at January 1,
    2009(1)


57,298,097Granted  2009


106,481,054Paid, forfeited, or released from contingencies


(42,346,715
)Outstanding at December 31, 2009


121,432,436  (1)
    
    Bank of Americas shares
    and units pursuant to the January 1, 2009 acquisition of
    Merrill Lynch by Bank of America. Upon completion of the
    acquisition, each outstanding share of ML & Co. common
    stock was converted into 0.8595 shares of Bank of America
    common stock.    Predecessor CompanyNo Future Service Required

Future Service RequiredWeighted Avg



Weighted AvgShares/Units

Grant Price

Shares/Units

Grant PriceOutstanding at December 28, 2007


48,738,883


$
66.33



22,038,948


$
83.60Granted  2008


14,099,302



52.13



35,053,837



52.19Delivered


(46,722,014
)


67.23



-



-Forfeited


(1,697,122
)


75.28



(5,006,086
)


64.16Service criteria
    satisfied(1)


12,351,587



82.90



(12,351,587
)


82.90Outstanding at December 26, 2008


26,770,636



64.36



39,735,112



58.56  (1)
    
    Represents those awards for
    which employees attained retirement-eligibility or for which
    service criteria were satisfied during 2008, subsequent to the
    grant date.  144




---



##### Table of Contents



Successor CompanyNo Future Service Required

Future Service RequiredWeighted Avg



Weighted AvgShares/Units

Grant Price

Shares/Units

Grant PriceOutstanding at January 1,
    2009(1)


23,667,538


$
14.08



33,630,559


$
14.08Granted  2009


46,823,656



9.61



59,657,398



12.76Delivered


(9,382,341
)


14.07



(12,831,269
)


14.05Forfeited


(2,153,204
)


9.77



(17,979,901
)


14.04Service criteria
    satisfied(2)


1,349,461



14.08



(1,349,461
)


14.08Outstanding at December 31, 2009


60,305,110



10.76



61,127,326



12.81  (1)
    
    Bank of Americas shares
    and units pursuant to the January 1, 2009 acquisition of
    Merrill Lynch by Bank of America. Upon completion of the
    acquisition, each outstanding share of ML & Co. common
    stock was converted into 0.8595 shares of Bank of America
    common stock. The weighted average grant price reflects the
    revaluation of these awards in accordance with Business
    Combinations Accounting.(2)
    
    Represents those awards for
    which employees attained retirement-eligibility or for which
    service criteria were satisfied during 2009, subsequent to the
    grant date.      2009(1)

2008

2007Successor CompanyRestricted Stock

$
11.38



N/A



N/APredecessor CompanyLTIC PlansRestricted Shares


N/A


$
34.25


$
80.56Restricted Units


N/A



42.60



81.28ECAP Restricted Shares


N/A



49.04



88.55ESCP PlansRestricted Shares


N/A



N/A



95.83Restricted Units


N/A



55.59



95.60  (1)
    
    2009 includes shares granted
    under ESCP and KASP.  Stock
    Appreciation Rights and Non-Qualified Stock Options
   145




---



##### Table of Contents



Predecessor CompanyWeighted-AverageOptions

ExerciseOutstanding

PriceOutstanding at December 29, 2006


130,487,807


$
52.47Granted  2007


3,376,222



49.37Exercised


(20,786,338
)


43.77Forfeited


(268,617
)


45.75Outstanding at December 28, 2007


112,809,074



54.00Granted  2008


17,692,428



49.22Exercised


(4,126,509
)


32.19Forfeited


(1,243,611
)


53.84Outstanding at December 26, 2008


125,131,382


$
54.04   Successor CompanyWeighted-AverageOptions

ExerciseOutstanding

PriceOutstanding at January 1,
    2009(1)


107,521,280


$
62.89Granted  2009


-



-Exercised


(2,835
)


12.56Forfeited


(14,612,169
)


46.17Outstanding at December 31, 2009


92,906,276


$
65.52Exercisable at December 31, 2009


84,109,366


$
66.02  (1)
    
    Bank of Americas options
    pursuant to the January 1, 2009 acquisition of Merrill
    Lynch by Bank of America. Upon completion of the acquisition,
    each outstanding ML & Co. option was converted into
    0.8595 Bank of America options.         146




---



##### Table of Contents



2008

2007Risk-free interest rate


3.14
%


4.79
%Expected life (in years)


6.6



4.3Expected volatility


39.42
%


21.39
%Expected dividend yield


3.20
%


1.49
%       Employee
    Stock Purchase Plan (ESPP)
  he/she
    Successor


PredecessorCompany


Company2009(1)


2008

2007Available, beginning of year


16,449,696




21,710,119



22,572,871Purchased through plan


(4,019,593
)



(2,571,438
)


(862,752
)Available, end of year


12,430,103




19,138,681



21,710,119  (1)
    
    Bank of Americas shares
    pursuant to the January 1, 2009 acquisition of Merrill
    Lynch by Bank of America. Upon completion of the acquisition,
    each outstanding share of ML & Co. common stock was
    converted into 0.8595 shares of Bank of America common
    stock.    Financial
    Advisor Capital Accumulation Award Plans
    (FACAAP)
   147




---



##### Table of Contents



Other
    Compensation Arrangements
       Note 17.  Income Taxes    (dollars in millions)Successor


PredecessorCompany


CompanyYear Ended


Year Ended

Year EndedDecember 31,


December 26,

December 28,2009


2008

2007Current income tax (benefit)/expenseU.S. federal

$
(2,229
)


$
(854
)

$
(391
)U.S. state


134




218



(73
)Non-U.S.


503




2,442



1,194Total current (benefit)/expense


(1,592
)



1,806



730Deferred income tax expense/(benefit)U.S. federal


665




(6,516
)


(867
)U.S. state


(357
)



(895
)


(112
)Non-U.S.


446




(8,675
)


(3,945
)Total deferred expense/(benefit)


754




(16,086
)


(4,924
)Total income tax
    benefit(1)

$
(838
)


$
(14,280
)

$
(4,194
)Total income tax (benefit)/expense from discontinued
    operations

$
-



$
(80
)

$
537  (1)
    
    The income tax benefit does not
    reflect the deferred tax effects of unrealized gains and losses
    on available for sale investment securities, foreign currency
    translation adjustments, cash flow hedges and defined benefit
    pension and postretirement plans that are included in
    accumulated other comprehensive loss. As a result of these tax
    effects, accumulated other comprehensive loss increased by $796
    million in 2009. In addition, the income tax benefit does not
    reflect the tax effects associated with employee stock plans,
    which decreased stockholders equity by $37 million in
    2009. 148




---



##### Table of Contents



(benefit)/expense tax
  (dollars in millions)Successor


PredecessorCompany


CompanyYear Ended


Year Ended

Year EndedDecember 31,


December 26,

December 28,2009


2008

2007Amount

Percent


Amount

Percent

Amount

PercentU.S. federal income tax at statutory rate

$
1,364



35.0
%


$
(14,641
)


35.0
%

$
(4,491
)


35.0
%U.S. state and local income taxes, net of federal effect


(145
)


(3.7
)



(440
)


1.1



(120
)


0.9Reduction in U.S. valuation allowance


(650
)


(16.7
)



-



-



-



-Loss on certain foreign subsidiary stock, net of valuation
    allowance


(595
)


(15.3
)



(2,651
)


6.3



-



-Non-U.S. tax
    differential


(489
)


(12.6
)



2,663



(6.4
)


809



(6.3
)Tax-exempt income, including dividends


(174
)


(4.5
)



(255
)


0.6



(389
)


3.0Change in prior period unrecognized tax benefits (including
    interest)


(158
)


(4.1
)



-



-



-



-Payment related to price reset on common stock offering


-



-




875



(2.1
)


-



-Other


9



0.4




169



(0.4
)


(3
)


0.1Income tax benefit from continuing operations

$
(838
)


(21.5
)%


$
(14,280
)


34.1
%

$
(4,194
)


32.7
%Income tax (benefit)/expense from discontinued operations

$
-



-



$
(80
)


56.7
%

$
537



38.4
%      149




---



##### Table of Contents



Reconciliation
    of the Change in Unrecognized Tax Benefits
  (dollars in millions)Successor


Predecessor

PredecessorCompany


Company

Company2009(1)


2008

2007Beginning balance

$
1,924



$
1,526


$
1,482Increases related to positions taken during prior years


77




61



46Increases related to positions taken during the current year


129




212



226Decreases related to positions taken during prior years


(185
)



(255
)


(244
)Settlements


(313
)



(4
)


(1
)Expiration of statute of limitations


-




-



(1
)Cumulative translation adjustments


-




36



18Ending balance

$
1,632



$
1,576


$
1,526  (1)
    
    The beginning balance has been
    increased by $348 million, in accordance with Business
    Combinations Accounting.      Years Under

Status atJurisdiction

Examination(1)

December 31,
    2009U.S. federal


2004


In Appeals processU.S. federal


20052007


Field examinationU.K.


2007


Field examination  (1)
    
    All subsequent tax years in the
    jurisdictions above remain open to examination.     150




---



##### Table of Contents



non-U.S. examinations,
  non-U.S. jurisdictions non-U.S. taxing
   151




---



##### Table of Contents



(dollars in millions)Successor


PredecessorCompany


CompanyDecember 31,


December 26,2009


2008Deferred tax assetsNet operating loss
    carryforwards(1)

$
15,717



$
4,721Capital loss carryforwards


3,305




2,867Employee compensation and retirement benefits


1,763




3,171Allowance for credit losses


1,552




2,148Foreign currency


986




763Deferred interest


896




772Accrued expenses and other reserves


625




759Tax credit carryforwards


384




418Securities valuations


37




4,326Intangibles


-




604Other


386




1,159Gross deferred tax assets


25,651




21,708Valuation allowance


(3,740
)



(4,015
)Total deferred tax assets, net of valuation allowance


21,911




17,693Deferred tax liabilitiesLong term borrowings


3,693




-Intangibles


1,464




-Available-for-sale
    securities


58




-Other


599




1,246Gross deferred tax liabilities


5,814




1,246Net deferred tax
    assets(2)(3)

$
16,097



$
16,447  (1)
    
    The U.K. NOL carryforward
    deferred tax asset was $9.8 billion at December 31,
    2009 and $9.7 billion at December 26, 2008. The
    $9.7 billion deferred tax asset at December 26, 2008
    is not included in the table above.(2)
    
    Merrill Lynchs net
    deferred tax assets were reduced at January 1, 2009 by
    approximately $5.9 billion, in accordance with Business
    Combinations Accounting, as a result of its acquisition by Bank
    of America.(3)
    
    Merrill Lynchs net
    deferred tax assets were reduced during 2009 as a result of the
    sale of MLBUSA and MLBT-FSB to a subsidiary of Bank of
    America.    change-in-control
 152




---



##### Table of Contents



Note 18.
    Regulatory Requirements       non-U.S. subsidiaries
  Securities
    Regulation
  Rule 15c3-1, Rule 15c3-1. Rule 15c3-1
   153




---



##### Table of Contents



Banking
    Regulation
    
 Note 19.
    Discontinued Operations        154




---



##### Table of Contents



(dollars in millions)Predecessor CompanyDecember 26,

December 28,2008

2007Total revenues, net of interest expense

$
28


$
1,542(Losses) / earnings before income taxes

$
(141
)

$
1,397Income tax (benefit) /expense


(80
)


537Net (loss) / earnings from discontinued operations

$
(61
)

$
860     (dollars in millions)Predecessor CompanyDecember 26,2008Assets:Loans, notes and mortgages

$
117Other assets


53Total Assets

$
170Liabilities:Other payables, including interest

$
5Total Liabilities

$
5     
 Note 20.
    Restructuring Charge      155




---



##### Table of Contents



Note 21.
    Related Party Transactions       (dollars in millions)Cash and cash equivalents

$
8,265Cash and securities segregated for regulatory purposes


3,000Receivables under resale agreements and securities borrowed
    transactions


77Trading assets


700Intercompany Funding Receivable


5,778Other receivables


2,682Other assets


117Total

$
20,619     (dollars in millions)Payables under repurchase agreements

$
8,307Payables under securities loaned transactions


10,326Deposits


35Trading liabilities


718Other payables


4,164Total

$
23,550     
 Note 22.
    Quarterly Information (Unaudited)     earnings/(loss)
  156




---



##### Table of Contents



(dollars in millions, except per share amounts)For The Quarter EndedSuccessor Company


Predecessor Company(As Revised)

(As Revised)

(As Revised)Dec. 31,

Sept. 30,

June 30,

Mar. 31,


Dec. 26,

Sept. 26,

June 27,

Mar. 28,2009

2009

2009

2009


2008

2008

2008

2008Revenues

$
7,620


$
7,671


$
5,018


$
13,750



$
(9,832
)

$
7,846


$
6,056


$
12,686Interest expense


1,942



2,407



2,969



3,455




3,595



7,830



8,172



9,752Revenues, net of interest expense


5,678



5,264



2,049



10,295




(13,427
)


16



(2,116
)


2,934Non-interest expenses


4,453



4,779



5,235



4,921




8,741



8,267



5,995



6,235Pre-tax earnings/(loss) from continuing operations


1,225



485



(3,186
)


5,374




(22,168
)


(8,251
)


(8,111
)


(3,301
)Income tax (benefit)/expense


(1,102
)


(215
)


(1,145
)


1,624




(6,340
)


(3,131
)


(3,477
)


(1,332
)Net earnings/(loss) from continuing operations


2,327



700



(2,041
)


3,750




(15,828
)


(5,120
)


(4,634
)


(1,969
)Pre-tax loss from discontinued operations


-



-



-



-




(31
)


(53
)


(32
)


(25
)Income tax benefit


-



-



-



-




(15
)


(21
)


(12
)


(32
)Net (loss)/earnings from discontinued operations


-



-



-



-




(16
)


(32
)


(20
)


7Net earnings/(loss)

$
2,327


$
700


$
(2,041
)

$
3,750



$
(15,844
)

$
(5,152
)

$
(4,654
)

$
(1,962
)Loss per common share:Basic loss per common share from continuing operations


N/A



N/A



N/A



N/A



$
(9.94
)

$
(5.56
)

$
(4.95
)

$
(2.20
)Basic (loss)/earnings per common share from discontinued
    operations


N/A



N/A



N/A



N/A




(0.01
)


(0.02
)


(0.02
)


0.01Basic loss per common share


N/A



N/A



N/A



N/A



$
(9.95
)

$
(5.58
)

$
(4.97
)

$
(2.19
)Diluted loss per common share from continuing operations


N/A



N/A



N/A



N/A



$
(9.94
)

$
(5.56
)

$
(4.95
)

$
(2.20
)Diluted (loss)/earnings per common share from discontinued
    operations


N/A



N/A



N/A



N/A




(0.01
)


(0.02
)


(0.02
)


0.01Diluted loss per common share


N/A



N/A



N/A



N/A



$
(9.95
)

$
(5.58
)

$
(4.97
)

$
(2.19
)   N/A
    Earnings per share data is not presented for the 2009
    quarterly periods, as Merrill Lynch was a wholly-owned
    subsidiary of Bank of America during that period. 157




---



##### Table of Contents



Note 23.
    Parent Company Information    Merrill
    Lynch & Co., Inc.
    (Parent Company Only)
    Condensed Statements of Earnings/(Loss) and Comprehensive
    Income/(Loss)  (dollars in millions)Successor Company


Predecessor CompanyFor the Period fromFor the Year Ended


December 27, 2008 to


For the Year Ended


For the Year EndedDecember 31, 2009


December 31, 2008


December 26, 2008


December 28, 2007RevenuesPrincipal transactions


$
(3,897
)


$
(49
)


$
1,912



$
556Management service fees (from affiliates)



222




-




173




815Earnings from equity method investments



25




-




232




255Other income (loss)



563




40




811




(259
)Subtotal



(3,087
)



(9
)



3,128




1,367Interest revenue



3,507




(111
)



8,044




9,467Less interest expense



6,009




-




5,643




8,399Net interest (expense)/profit



(2,502
)



(111
)



2,401




1,068Revenues, net of interest expense



(5,589
)



(120
)



5,529




2,435Non-interest expensesCompensation and benefits



619




2




632




407Professional fees



45




-




439




237Communications and technology



30




-




50




63Occupancy and related depreciation



37




-




68




41Other



343




1




780




85Payment related to price reset on common stock offering



-




-




2,500




-Total non-interest expenses



1,074




3




4,469




833Pre-tax (loss)/earnings from continuing operations



(6,663
)



(123
)



1,060




1,602Income tax benefit/(expense)



3,376




50




(1,123
)



(311
)Equity in earnings/(loss) of affiliates, net of tax



8,023




(80
)



(27,549
)



(9,068
)Net earnings/(loss)



4,736




(153
)



(27,612
)



(7,777
)Other comprehensive loss, net of tax



(112
)



-




(4,529
)



(1,179
)Comprehensive income/(loss)


$
4,624



$
(153
)


$
(32,141
)


$
(8,956
)Preferred stock dividends



153




-




2,869




270Net earnings/(loss) applicable to common stockholders


$
4,583



$
(153
)


$
(30,481
)


$
(8,047
)    158




---



##### Table of Contents



Merrill
    Lynch & Co., Inc.
    (Parent Company Only)
    Condensed Balance Sheets  (dollars in millions, except per share amounts)Successor Company


Predecessor CompanyDecember 31,


December 26,2009


2008ASSETSCash and cash equivalents


$
474



$
12,096Cash and securities segregated for regulatory purposes or
    deposited with clearing organizations



-




139Receivables under resale agreements



1,022




30,000Investment securities (includes securities pledged as collateral
    that can be sold or repledged of $6,155 in 2009 and $14,003 in
    2008)



11,285




16,762Receivables from Bank of America



4,949




-Advances to affiliatesSenior advances



96,175




118,163Subordinated loans and preferred securities



50,629




51,280146,804




169,443Investments in affiliates



24,823




15,930Equipment and facilities (net of accumulated depreciation and
    amortization of $37 in 2009 and $218 in 2008)



49




63Goodwill and other intangible assets



3,738




-Other assets



12,955




1,591Total Assets


$
206,099



$
246,024LIABILITIES AND STOCKHOLDERS EQUITYLiabilitiesPayables under repurchase agreements


$
7,177



$
15,008Short-term borrowings



-




20,128Payables to affiliates



15,691




14,508Other liabilities and accrued interest payable



13,990




3,933Long-term borrowings (includes $29,531 in 2009 and $33,171 in
    2008 measured at fair value in accordance with the fair value
    option election)



128,103




172,444Total Liabilities



164,961




226,021COMMITMENTS AND CONTINGENCIESSTOCKHOLDERS EQUITYPreferred Stockholders Equity: authorized
    25,000,000 shares: (liquidation preference of $30,000 per
    share;issued: 2008  244,100 shares; liquidation
    preference of $1,000 per share; issued: 2008 
    115,000 shares; liquidation preference of $100,000 per
    share; issued: 2009  17,000 shares; issued:
    2008  17,000 shares)



1,541




8,605Common Stockholders EquityCommon stock (par value
    $1.331/3
    per share; authorized; 3,000,000,000 shares; issued:
    2009  1,000 shares; issued: 2008 
    2,031,995,436 shares)



-




2,709Paid-in capital



35,126




47,232Accumulated other comprehensive loss (net of tax)



(112
)



(6,318
)Retained earnings/(accumulated deficit)



4,583




(8,603
)39,597




35,020Less: Treasury stock, at cost (2009  none;
    2008  431,742,565 shares)



-




23,622Total Common Stockholders Equity



39,597




11,398Total Stockholders Equity



41,138




20,003Total Liabilities and Stockholders Equity


$
206,099



$
246,024    159




---



##### Table of Contents



Merrill
    Lynch & Co., Inc.
    (Parent Company Only)
    Condensed Statements of Cash Flows  (dollars in millions)Successor Company


Predecessor CompanyFor the Year Ended


For the Year Ended


For the Year EndedDecember 31, 2009


December 26, 2008


December 28, 2007Cash flows from operating activities:Net earnings/(loss)


$
4,736



$
(27,612
)


$
(7,777
)Adjustments to reconcile net earnings/(loss) to cash provided by
    operating activitiesEquity in (earnings)/loss of affiliates



(8,023
)



27,549




9,068Depreciation and amortization



96




15




15Share-based compensation expense



440




387




350Payment related to price reset on common stock offering



-




2,500




-Deferred taxes



(2,544
)



827




490Earnings from equity method investments



-




(207
)



(228
)Amortization of premium/(discount) on long-term borrowings



-




401




(543
)Unrealized losses/(gains) on long-term borrowings



369




(2,318
)



(1,589
)Foreign exchange losses/(gains) on long-term borrowings



3,156




(4,344
)



7,974Other



1,979




295




214Changes in operating assets and liabilities:Cash and securities segregated



139




322




(461
)Receivables under resale agreements



28,978




8,727




(31,791
)Receivables from Bank of America



(4,949
)



-




-Payables under repurchase agreements



(7,830
)



(1,989
)



11,527Dividends and partnerships distributions from affiliates



310




360




7,079Trading investment securities



-




-




4,688Other, net



(120
)



85




998Cash provided by operating activities



16,737




4,998




14Cash flows from investing activities:Proceeds from/(payments for):Advances to/(advances from) affiliates



23,823




10,970




(35,948
)Distributions to affiliates



(6,850
)



-




-Maturities of
    available-for-sale
    securities



4,225




3,108




3,023Sales of
    available-for-sale
    securities



1,507




464




407Purchases of
    available-for-sale
    securities



-




(3,728
)



(10,125
)Non-qualifying investments



51




194




83Investments in affiliates



(698
)



(17,806
)



(5,072
)Sale of MLBT-FSB to Bank of America



4,450




-




-Acquisitions, net of cash



-




-




(2,045
)Equipment and facilities, net



1




(14
)



(6
)Cash provided by/(used for) investing activities



26,509




(6,812
)



(49,683
)Cash flows from financing activities:(Payments for)/proceeds from:Short-term borrowings



(20,128
)



6,906




8,940Issuance and resale of long-term borrowings



-




38,786




93,648Settlement and repurchases of long-term borrowings



(41,437
)



(56,577
)



(49,950
)Capital contributions from Bank of America



6,850




-




-Issuance of common stock



-




9,899




4,787Issuance of preferred stock, net



-




9,281




1,123Common stock repurchases



-




-




(5,272
)Other common stock transactions



-




(833
)



(60
)Excess tax benefits related to share-based compensation



-




39




715Dividends



(153
)



(2,584
)



(1,505
)Cash (used for)/provided by financing activities



(54,868
)



4,917




52,426(Decrease)/increase in cash and cash equivalents



(11,622
)



3,103




2,757Cash and cash equivalents, beginning of
    period(1)



12,096




8,993




6,236Cash and cash equivalents, end of period


$
474



$
12,096



$
8,993Supplemental Disclosure of Cash Flow Information:Income taxes paid (net of refunds)


$
203



$
128



$
269Interest paid



4,289




5,903




7,594   Non-cash investing and financing activities;
 In connection with the acquisition of Merrill Lynch by Bank
    of America, ML & Co. recorded purchase accounting
    adjustments for the year ended December 31, 2009, which
    were recorded as non-cash capital contributions.
 In connection with the sale of Merrill Lynch Bank USA to a
    subsidiary of Bank of America during 2009, ML & Co.
    received a note receivable as consideration for the net book
    value of assets and liabilities transferred to Bank of
    America.
 As a result of the conversion of $6.6 billion of Merrill
    Lynchs mandatory convertible preferred stock,
    series 1, ML & Co. recorded additional preferred
    dividends of $2.1 billion in 2008. The preferred dividends
    were paid in additional shares of common stock and preferred
    stock.
 In satisfaction of Merrill Lynchs obligations under the
    reset provisions contained in the investment agreement with
    Temasek, in 2008 ML & Co. paid Temasek $2.5 billion
    through the issuance of common stock.
  (1)
    
    Amount for Successor Company is
    as of January 1, 2009.  160




---



##### Table of Contents



Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure  8-K
  Item 9A.
    Controls
    and Procedures  Material
    Weaknesses Previously Disclosed
  Form 10-K Form 10-Q Derivatives and Hedging
    Evaluation
    of Disclosure Controls and Procedures
  Rule 13a-15(b) Rule 13a-15(e)
  Report on
    Internal Control Over Financial Reporting
     161




---



##### Table of Contents



Internal
    Control-Integrated Framework
    Changes
    in Internal Control over Financial Reporting
  Rule 13a-15(f)
 162




---



##### Table of Contents



Item 9B.
    Other
    Information    PART III  Item 10.
    Directors,
    Executive Officers and Corporate Governance    Item 11.
    Executive
    Compensation    Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    related Stockholder Matters    Item 13.
    Certain
    Relationships and Related Transactions, and Director
    Independence    Item 14.
    Principal
    Accountant Fees and Services  Pre-Approval
    of Services Provided by the Independent Registered Public
    Accounting Firm
        Fees Paid
    to the Independent Registered Public Accounting Firm
   163




---



##### Table of Contents



(dollars in millions)2009

2008Audit
    fees(1)

$
47.4


$
46.3Audit-related
    fees(2)


3.0



7.4Tax
    fees(3)


3.2



2.8All other
    fees(4)


-



-Total fees

$
53.6


$
56.5   (1)
    For 2009, Audit fees consisted of fees billed by PwC related
    to the audit of the Consolidated Financial Statements filed with
    the SEC, the audits of domestic and international statutory and
    subsidiary financial statements and certain agreed upon
    procedures and other attestation reports. For 2008, Audit fees
    consisted of fees for the audits of the consolidated financial
    statements and reviews of the condensed consolidated financial
    statements filed with the SEC on
    Forms 10-K
    and 10-Q as
    well as work generally only the independent registered public
    accounting firm can be reasonably expected to provide, such as
    comfort letters, statutory audits, consents and review of
    documents filed with the SEC, including certain
    Form 8-K
    filings. Audit fees also included fees for the audit opinion
    rendered regarding the effectiveness of internal control over
    financial reporting.(2)
    For 2009, Audit-related fees consisted of fees billed by PwC
    for other audit and attest services, and financial accounting,
    reporting and compliance matters. For 2008, Audit-related fees
    consisted principally of attest services pursuant to Statement
    of Auditing Standards No. 70, Service
    Organizations, transaction services such as due diligence
    and accounting consultations related to acquisitions, accounting
    consultations and attest services relating to financial
    accounting and reporting standards, fees for employee benefit
    plan audits, reports in connection with
    agreed-upon
    procedures related to subsidiaries that deal in derivatives and
    in connection with data verification and
    agreed-upon
    procedures related to asset securitizations.(3)
    For 2009, Tax fees pertain to services performed for tax
    compliance, advisory and planning services. Tax fees for these
    areas are billed to Bank of America Corporation on a
    consolidated basis and are excluded from the table above. The
    tax fees reflected above include preparation of certain tax
    returns (principally Forms 1041 and 990) for certain
    customer trusts and foundations. For 2008, Tax fees consisted of
    fees for all services performed by the independent registered
    public accounting firms tax personnel, except those
    services specifically related to the audit and review of the
    financial statements, and consisted principally of tax
    compliance (i.e., services rendered based upon facts already in
    existence or transactions that have already occurred to
    document, compute and obtain government approval for amounts to
    be included in tax filings), tax advisory and tax planning
    services. Tax compliance related fees accounted for
    $2.5 million of the 2008 tax fees.(4)
    For 2009, All other fees consists of advisory services, which
    are billed to Bank of America Corporation on a consolidated
    basis and are excluded from the table above. There were no All
    other fees for 2008. 164




---



##### Table of Contents



PART IV  Item 15.
    Exhibits
    and Financial Statement Schedules    (1)
    Financial Statements:  Form 10-K.
  (2)
    Schedules:  Form 10-K.
  (3)
    Exhibits  page E-1
 165




---



##### Table of Contents



SIGNATURES    Merrill Lynch &
    Co., Inc.
  By
    */s/  Thomas
    K. Montag   Title:
    Director and Chief Executive Officer    Signature

Title*/s/  Thomas
    K. MontagThomas
    K. Montag

Director and Chief Executive Officer (Principal Executive
    Officer)*/s/  Robert
    QutubRobert
    Qutub

Chief Financial Officer (Principal Financial Officer)*/s/  Thomas
    W. PerryThomas
    W. Perry

Chief Accounting Officer and Controller (Principal Accounting
    Officer)*/s/  Brian
    T. MoynihanBrian
    T. Moynihan

Chairman*/s/  Neil
    A. CottyNeil
    A. Cotty

Director*/s/  Sallie
    L. KrawcheckSallie
    L. Krawcheck

Director/s/  Bruce
    ThompsonBruce
    Thompson

DirectorBy:

/s/  Teresa
    M. BrennerTeresa
    M. Brenner 
    Attorney-in-Fact  166




---



##### Table of Contents



EXHIBIT INDEX
  001-07182. Form 10-Q, Form 10-K, Form 8-K Form S-3 10-Q, 10-K, 8-K S-3,
  Plan of acquisition, reorganization, arrangement, liquidation
    or succession2
.1

Agreement and Plan of Merger, dated as of September 15,
    2008, by and between Merrill Lynch & Co., Inc. and
    Bank of America Corporation (incorporated by reference to
    Exhibit 2.1 to Merrill Lynchs Current Report on
    Form 8-K
    dated September 19, 2008).2
.2*

Stock Purchase and Sale Agreement, dated as of April 21,
    2009, among Merrill Lynch Group, Inc., BANA Holding Corporation,
    and Merrill Lynch Bank USA2
.3*

Stock Purchase and Sale Agreement, dated as of August 12,
    2009, among Merrill Lynch & Co., Inc., BANA Holding
    Corporation and Merrill Lynch Bank & Trust Co.,
    FSBArticles of Incorporation and By-Laws3
.1

Restated Certificate of Incorporation of Merrill Lynch,
    effective as of May 3, 2001 (incorporated by reference to
    Exhibit 3.1 to
    8-K dated
    November 14, 2005).3
.2

Certificate of Designations establishing the rights,
    preferences, privileges, qualifications, restrictions and
    limitations relating to ML & Co.s Floating Rate
    Non-Cumulative Preferred Stock, Series 1, par value $1.00
    per share, effective as of October 25, 2004 (the
    Series 1 Preferred Stock) (incorporated by
    reference to Exhibit 3.2 and 4.1 to
    8-K dated
    November 14, 2005).3
.3

Certificate of Designations establishing the rights,
    preferences, privileges, qualifications, restrictions and
    limitations relating to ML & Co.s Floating Rate
    Non-Cumulative Preferred Stock, Series 2, par value $1.00,
    effective as of March 9, 2005 (the Series 2
    Preferred Stock) (incorporated by reference to
    Exhibit 3.3 and 4.2 to
    8-K dated
    November 14, 2005).3
.4

Certificate of Designations establishing the rights,
    preferences, privileges, qualifications, restrictions and
    limitations relating to ML & Co.s 6.375%
    Non-Cumulative Preferred Stock, Series 3, par value $1.00
    per share, effective as of November 14, 2005 (the
    Series 3 Preferred Stock) (incorporated by
    reference to Exhibit 3.4 and 4.3 to
    8-K dated
    November 14, 2005).3
.5

Certificate of Designations establishing the rights,
    preferences, privileges, qualifications, restrictions and
    limitations relating to ML & Co.s Floating Rate
    Non-Cumulative Preferred Stock, Series 4, par value $1.00
    per share, effective as of November 14, 2005 (the
    Series 4 Preferred Stock) (incorporated by
    reference to Exhibit 3.5 and 4.4 to
    8-K dated
    November 14, 2005).3
.6

Certificate of Designations establishing the rights,
    preferences, privileges, qualifications, restrictions and
    limitations relating to ML & Co.s Floating Rate
    Non-Cumulative Preferred Stock, Series 5, par value $1.00
    per share, effective as of March 16, 2007 (the
    Series 5 Preferred Stock) (incorporated by
    reference to Exhibit 3.6 and 4.5 to
    8-K dated
    March 21, 2007).3
.7

Certificate of Designations establishing the rights,
    preferences, privileges, qualifications, restrictions and
    limitations relating to ML & Co.s 6.70%
    Non-Cumulative Perpetual Preferred Stock, Series 6, par
    value $1.00 per share, effective as of September 21, 2007
    (the Series 6 Preferred Stock) (incorporated by
    reference to Exhibit 3.7 and 4.6 to
    Form 8-K
    dated September 24, 2007).3
.8

Certificate of Designations establishing the rights,
    preferences, privileges, qualifications, restrictions and
    limitations relating to ML & Co.s 6.25%
    Non-Cumulative Perpetual Preferred Stock, Series 7, par
    value $1.00 per share, effective as of September 21, 2007
    (the Series 7 Preferred Stock) (incorporated by
    reference to Exhibit 3.8 and 4.7 to
    8-K dated
    September 24, 2007). E-1




---



##### Table of Contents



3
.9

Certificate of Designations establishing the rights,
    preferences, privileges, qualifications, restrictions and
    limitations relating to ML & Co.s 9.00%
    Non-Voting Mandatory Convertible Non-Cumulative Preferred Stock,
    Series 1, par value $1.00 per share, effective as of
    January 15, 2008 (incorporated by reference to
    Exhibit 3.9 and 4.8 to
    8-K dated
    January 16, 2008).3
.10

Certificate of Designations establishing the rights,
    preferences, privileges, qualifications, restrictions and
    limitations relating to ML & Co.s 8.625%
    Non-Cumulative Preferred Stock, Series 8 (incorporated by
    reference to Exhibits 3.10 and 4.9 to
    Form 8-K
    dated April 29, 2008).3
.11

Certificate of Designations establishing the rights,
    preferences, privileges, qualifications, restrictions and
    limitations relating to ML & Co.s 9.00%
    Non-Voting Mandatory Convertible Non-Cumulative Preferred Stock,
    Series 2, par value $1.00 per share and liquidation
    preference $100,000 per share (incorporated by reference to
    Exhibits 3.11 and 4.10 to
    Form 8-K
    dated August 1, 2008).3
.12

Certificate of Designations establishing the rights,
    preferences, privileges, qualifications, restrictions and
    limitations relating to ML & Co.s 9.00%
    Non-Voting Mandatory Convertible Non-Cumulative Preferred Stock,
    Series 3, par value $1.00 per share and liquidation
    preference $100,000 per share (incorporated by reference to
    Exhibits 3.12 and 4.11 are incorporated by reference to
    Registrants Current Report on
    Form 8-K
    dated August 1, 2008).3
.13

Certificate of Merger merging MER Merger Corporation with and
    into Merrill Lynch & Co., Inc. (incorporated by
    reference to Exhibit 3.1 to
    8-K dated
    January 2, 2009).3
.14

Certificate of Amendment to Certificate of Designations of 9.00%
    Non-Voting Mandatory Convertible Non-Cumulative Preferred Stock,
    Series 2 of ML & Co. (incorporated by reference
    to Exhibit 3.2 to
    8-K dated
    January 2, 2009).3
.15

Certificate of Amendment to Certificate of Designations of 9.00%
    Non-Voting Mandatory Convertible Non-Cumulative Preferred Stock,
    Series 3 of Merrill Lynch & Co., Inc.
    (incorporated by reference to Exhibit 3.3 to
    8-K dated
    January 2, 2009).3
.16

By-Laws of Merrill Lynch & Co., Inc. as of
    January 1, 2009 (incorporated by reference to
    Exhibit 3.4 to
    8-K dated
    January 2, 2009).Instruments Defining the Rights of Security Holders,
    Including IndenturesML & Co. hereby undertakes to
    furnish to the SEC, upon request, copies of any agreements not
    filed defining the rights of holders of long-term debt
    securities of ML & Co., none of which authorize an
    amount of securities that exceed 10% of the total assets of
    ML & Co.4
.1

Senior Indenture, dated as of April 1, 1983, as amended and
    restated as of April 1, 1987, between ML & Co.
    and The Bank of New York
    Mellon,(1)

    as Trustee (1983 Senior Indenture) and the
    Supplemental Indenture thereto dated as of March 5, 1990
    (incorporated by reference to Exhibit 4(i) to
    10-K for the
    fiscal year ended December 29, 1999 (1999
    10-K)).4
.2

Sixth Supplemental Indenture to the 1983 Senior Indenture, dated
    as of October 25, 1993, between ML & Co. and The
    Bank of New York Mellon (incorporated by reference to
    Exhibit 4(ii) to 1999
    10-K).4
.3

Twelfth Supplemental Indenture to the 1983 Senior Indenture,
    dated as of September 1, 1998, between ML & Co.
    and The Bank of New York Mellon (incorporated by reference to
    Exhibit 4(a) to
    8-K dated
    October 21, 1998).4
.4

Fifteenth Supplemental Indenture to the 1983 Senior Indenture,
    dated as of October 14, 2003, between ML & Co.
    and The Bank of New York Mellon (incorporated by reference to
    Exhibit 4(b)(ix) to
    S-3 (file
    no. 333-109802))    (1)
 E-2




---



##### Table of Contents



4
.5

Eighteenth Supplemental Indenture to the 1983 Senior Indenture,
    dated as of October 21, 2004, between Merrill Lynch and The
    Bank of New York Mellon, incorporated by reference to
    Exhibit 4(b)(xiv) to Merrill Lynchs Registration
    Statement on
    Form S-3
    (file
    no. 333-122639).4
.6

Senior Indenture, dated as of October 1, 1993 between
    ML & Co. and The Bank of New York Mellon (1993
    Senior Indenture) (incorporated by reference to
    Exhibit(4)(iv) to
    10-K for
    fiscal year ended December 25, 1998 (1998
    10-K)).4
.7

First Supplemental Indenture to the 1993 Senior Indenture, dated
    as of June 1, 1998, between ML & Co. and The Bank
    of New York Mellon (incorporated by reference to
    Exhibit 4(a) to
    8-K dated
    July 2, 1998).4
.8

Form of Subordinated Indenture, dated as of December 17,
    1996, between ML & Co. and The Bank of New York
    Mellon, as trustee (1996 Subordinated Indenture)
    (incorporated by reference to Exhibit 4.7 to Amendment
    No. 2 to
    S-3 (file
    no. 333-16603).4
.9

Supplemental Indenture to the 1996 Subordinated Indenture, dated
    as of May 16, 2006, between ML & Co. and The Bank
    of New York Mellon, as trustee (incorporated by reference to
    Exhibit 4(a) to ML & Co.s Report on
    Form 8-K
    dated May 16, 2006)4
.10

Junior Subordinated Indenture, dated as of December 14,
    2006, between Merrill Lynch & Co., Inc. and The Bank
    of New York Mellon, as trustee (2006 Junior Subordinated
    Indenture) (incorporated by reference to Exhibit 4(a)
    to ML & Co.s Report on
    Form 8-K
    dated December 14, 2006).4
.11

First Supplemental Indenture to the 2006 Junior Subordinated
    Indenture, dated as of December 14, 2006, between Merrill
    Lynch & Co., Inc. and The Bank of New York Mellon, as
    trustee (incorporated by reference to Exhibit 4(b) to
    ML & Co.s Report on
    Form 8-K
    dated December 14, 2006).4
.12

Second Supplemental Junior Subordinated Indenture to the 2006
    Junior Subordinated Indenture, dated as of May 2, 2007,
    between ML & Co. and The Bank of New York Mellon, as
    Trustee (incorporated by reference to Exhibit 4(b) to
    Form 8-K
    dated May 2, 2007).4
.13

Third Supplemental Indenture to the 2006 Junior Subordinated
    Indenture, dated as of August 22, 2007, between
    ML & Co. and The Bank of New York Mellon, as Trustee
    (incorporated by reference to Exhibit 4(b) to
    Form 8-K
    dated August 22, 2007).4
.14

Indenture, dated as of December 14, 2004, between
    ML & Co. and The Bank of New York Mellon, relating to
    ML & Co.s Exchange Liquid Yield
    Option(tm) Notes
    due 2032 (Zero Coupon  Floating Rate 
    Senior) (incorporated by reference to Exhibit 4(a)(vii) to
    S-3 (file
    no. 333-122639)).4
.15

First Supplemental Indenture, dated as of March 6, 2008,
    between Merrill Lynch & Co., Inc. and The Bank of New
    York Mellon, as trustee (incorporated by reference to
    Exhibit 4 to Merrill Lynch & Co., Inc.s
    Form 8-K
    filed March 6, 2008).4
.16

Second Supplemental Indenture, dated as of January 1, 2009,
    between Merrill Lynch & Co., Inc., Bank of America
    Corporation and The Bank of New York Mellon, as trustee
    (incorporated by reference to Exhibit 4 to Merrill
    Lynch & Co., Inc.s
    Form 8-K
    filed January 5, 2009.)Material Contracts10
.1

Merrill Lynch & Co., Inc. 2010 Performance Year
    Deferred Compensation Plan (incorporated by reference to
    Exhibit 4(a) of to
    S-8 (file
    no. 333-163003)10
.2

Form of Agreement dated May 1, 2008 with Thomas K. Montag
    (filed as Exhibit 10.1 to ML & Co.s Report
    on
    Form 8-K
    dated May 2, 2008).11


Statement re: computation of earnings per common share (the
    calculation of per share earnings is in Part II,
    Item 8, Note 13 to the Consolidated Financial
    Statements (Stockholders Equity and Earnings Per Share)
    and is not required in accordance with Section(b)(11) of
    Item 601 of
    Regulation S-K).12
*

Statement re: computation of ratios.23
.1*

Consent of Pricewaterhouse Coopers LLP, Independent Registered
    Public Accounting Firm of the Registrant. E-3




---



##### Table of Contents



23
.2*

Consent of Deloitte & Touche LLP, Independent
    Registered Public Accounting Firm23
.3*

Consent of Deloitte & Touche LLP, Independent
    Registered Public Accounting Firm of BlackRock, Inc.24
.1*

Power of Attorney.24
.2*

Certificate of Assistant Secretary.31
.1*

Rule 13a-14(a)
    Certification of the Chief Executive Officer.31
.2*

Rule 13a-14(a)
    Certification of the Chief Financial Officer.32
.1*

Certification Pursuant to 18 U.S.C. Section 1350, as
    Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
    of 2002.32
.2*

Certification Pursuant to 18 U.S.C. Section 1350, as
    Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
    of 2002.Additional Exhibits99
.1

Audited consolidated financial statements of BlackRock, Inc.
    (BlackRock) for the year ended December 31,
    2009 are incorporated herein by reference to Item 15(1) of
    BlackRocks 2009 Annual Report on
    Form 10-K
    (Commission File Number 001-33099).    *
    
    Filed herewith
    
    Management contract or
    compensatory plan or arrangement E-4