NEW YORK (Reuters) - Merrill Lynch & Co said yesterday it lost $15.84 billion in the fourth quarter, about $533 million more than the loss previously estimated by Bank of America Corp.

In its annual report filed with the US Securities and Exchange Commission, Merrill also revealed material weaknesses in its controls over financial reporting as of the end of its fiscal year on Dec. 26, 2008.

Merrill's fourth-quarter loss equaled $9.95 per share, the report showed. Bank of America had on January 16 estimated that Merrill lost $15.31 billion in the fourth quarter.

For all of 2008, Merrill lost $27.61 billion, or $24.87 per share, amid big write-downs and investment losses on collateralised debt obligations and a variety of other risky securities.

Merrill agreed to be acquired by Bank of America last September 15, the same morning that Lehman Brothers Holdings Inc went bankrupt, after a weekend of hasty talks.

Bank of America later threatened to back out of the merger as it became clear that Merrill's losses were soaring, but said US regulators pushed it to complete the merger. The January 1 closing created the largest US bank by assets.

The Charlotte, North Carolina-based bank now faces many shareholder lawsuits over the merger, and in mid-January got a government bailout to help it absorb losses on $118 billion of troubled assets. Bank of America has accepted $45 billion of government aid since October.

New York Attorney General Andrew Cuomo, meanwhile, is conducting a probe into $3.6 billion of executive bonuses awarded by Merrill just before the closing.

John Thain, Merrill's former chief executive, was expected yesterday to provide more testimony to Cuomo's office about the bonuses. Bank of America chief executive Kenneth Lewis has received a subpoena to testify before Cuomo's investigators.

According to the annual report, Merrill had material weaknesses related to a failure to properly test measurements used to value intercompany swaps, and a failure to account properly for some hedging positions, including a "single material hedge relationship" begun in the fourth quarter.

Merrill has corrected the problems, and has a goal of eliminating the material weaknesses this quarter, the report said.

Lewis ousted Thain as head of investment banking and wealth management on January 22. Brian Moynihan, a top Bank of America executive, replaced Thain.

Bank of America shares closed Tuesday up 82 cents, or 21 percent, at $4.73. Federal Reserve chairman Ben Bernanke's comments that suggested nationalisation of big banks was not at hand led to sharp gains for bank stocks.

But Bank of America's shares are down 86 percent since the Merrill acquisition was first announced.