Bank of America/Merrill Lynch is in the market with a $1.995 billion auto loan-backed deal, according to a person familiar with the matter.

The deal is eligible for a Federal Reserve program, the Term Asset Backed Securities Loan Facility, or TALF, through which investors can procure cheap loans to buy newly created consumer loan-backed and new and existing commercial mortgage-backed bonds.

Bank of America's deal, dubbed BAAT 2009-2, is jointly led by Bank of America/Merrill Lynch, Barclays Capital, Citigroup, Credit Suisse and Royal Bank of Scotland.

Last month, Bank of America (BAC) sold a $3.993 billion auto-loan backed deal at 135 basis points over a benchmark. That was the bank's first deal eligible under TALF.

-By Anusha Shrivastava, Dow Jones Newswires; 212-416-2227; anusha.shrivastava@dowjones.com