Bank of America today announced the payment of $402 million as dividend to the US government as part of its commitment to paying back US taxpayers.

Today's payment represents the dividend on the fixed-rate cumulative perpetual preferred stock issued in connection with the $45 billion in government investments that Bank of America received in late 2008 and early 2009.

Approximately $223 million relates to the federal government's $15 billion investment in Bank of America made under the Capital Purchase Program of the Troubled Asset Relief legislation and an additional $50 million relates to the federal government's $10 billion investment in Bank of America as part of the agreement to acquire Merrill Lynch & Co., Inc.

The remaining $129 million stems from the government's $20 billion investment on 16 January to help facilitate the acquisition of Merrill Lynch. Total cash dividend payments to the government in 2009 will reach approximately $2.8 billion.

"It is our intention to pay back these loans, as soon as possible," said Bank of America chairman and chief executive Ken Lewis. "In the meantime, we are using these funds to support the US economy by extending credit to individuals and businesses," he added.

Bank of America said it extended more than $115 billion in new credit during the fourth quarter of 2008, of which about $49 billion was in commercial non-real estate; $45 billion in mortgages; nearly $8 billion in domestic card and unsecured consumer loans; nearly $7 billion in commercial real estate; more than $5 billion was in home equity products; and approximately $2 billion was in consumer dealer financial services.

Bank of America also committed to assisting as many as 630,000 customers to help them stay in their homes, representing more than $100 billion in mortgage financing. In 2008, the company modified approximately 230,000 home loans - representing more than $44 billion in mortgage financing. Bank of America also modified nearly 700,000 credit card loans for borrowers experiencing financial hardship last year.

Bank of America, America's top bank and one of the world's largest financial institutions, claims to have more than 59 million consumer and small business customers, over 6,100 retail banking offices, nearly 18,700 ATMs and nearly 29 million active users.

Bank of America acquired Merrill Lynch, the world's leading wealth management company, on 1 January 2009, under a financing arrangement with the US federal Reserve.