//
The bank has lost billions of dollars in the US mortgage market and the development could have global consequences.
Over the last 12 months, investments with the bank have plummeted. According to a City source, an investment of £100,000 made this time last year would now be worth just £8,000.
It is believed the bank's broker-dealer division and asset management division Neuberger Berman Holdings will not be included in the bankruptcy filing.
Around 5,000 people are employed by the financial institution in the UK, with a further 20,000 employees worldwide.
Robert Peston, the BBC's business editor, commented: "The global financial economy has never in recent years been tested by quite such a combination of accidents and jolts to confidence."
In related news, Bank of America has revealed it will buy investment bank Merrill Lynch for $50 billion (£28 billion). The deal will create the largest financial services company in the world.
Learn more about stocks and shares with Knowledge to Action.
