The software will run on BofA's premises but will use Oracle's people and hardware and will use the same underlying technology as Oracle's cloud-based enterprise retail planning. CEO Mark Hurd argues this approach will work well in regulated industries, and won't require as many people to manage as traditional on-premises installations.
Oracle said the deal involves Bank of America's international general ledger and broker-dealer systems. Rival SAP provides enterprise resource planning for the rest of the bank.
It's a foot in the door to migrate BofA to more of a hybrid cloud solution in the future.
"Oracle will deliver Bank of America the most modern, complete, global ERP applications in the world," said Hurd.
"Our continued focus on technology modernization has positioned Bank of America as a contemporary technology company," said Cathy Bessant, Bank of America chief operations and technology officer.
"Our agreement with Oracle is about our technology and culture; we'll learn with and from each other to deliver the best solutions. We anticipate 80 percent of our technology workloads will be delivered on the cloud within the next few years, and this solution for general ledger reflects our evolving strategy and the improvements in cloud security and economics."
The deal bolsters Oracle's cloud credibility in the financial sector — a space that requires high levels of security and privacy protections.
— Reporting by CNBC's Jon Fortt.
Correction: This story was updated to clarify that SAP provides enterprise resource planning for the rest of the bank.