SAO PAULO (Reuters) - State-controlled Banco do Brasil SA, the nation's largest lender by assets, plans to book additional loan-loss provisions of 650 million reais ($192 million) due to a decision by phone carrier Oi SA to seek bankruptcy protection this week, a source with direct knowledge of the situation said.

Should a bankruptcy court approve Oi's petition, Banco do Brasil would have to raise provisions on outstanding loans to Oi to 1.2 billion reais, said the source, who requested anonymity to speak about the matter. Currently, Banco do Brasil has proprietary investments worth 1.9 billion reais in Oi's local and global notes, the source added.

(Reporting by Aluísio Alves; Writing by Guillermo Parra-Bernal; Editing by Tom Brown)