NEW YORK — Billionaire Warren Buffett's Berkshire Hathaway will buy $5 billion in preferred shares of beleaguered US banking giant Bank of America, the bank said on Thursday.

"Bank of America Corporation announced today that it reached an agreement to sell 50,000 shares of Cumulative Perpetual Preferred Stock with a liquidation value of $100,000 per share to Berkshire Hathaway, Inc. in a private offering," BofA said in a statement.