BANK OF AMERICA CORP., $14.17, New York symbol BAC, rose over 50% this week despite the fact that it needs to raise $33.9 billion in additional capital to satisfy government regulators. That’s equal to 37% of the bank’s $90.7-billion market cap. The Federal Reserve has evaluated the 19 largest U.S. banks to see how well they would cope if unemployment continues to rise and home prices keep falling. Such an environment would surely produce higher loan losses, and the aim of this “stress test” is to identify the banks that would have the most difficulty absorbing these. Bank of America failed this test, so it will have to strengthen its balance sheet. There are a number of ways it could do this, including converting its preferred shares to common shares, although this would significantly dilute the holdings of its existing shareholders. As well, the U.S. government holds $45 billion worth of Bank of America’s preferred shares, so converting them to common…