Warren Buffett, the billionaire investor, has reduced his exposure to two banks while increasing his commitment to Bank of America (BAC) and acquiring new stock in Capital One (COF) during the last quarter.
Berkshire Hathaway, Buffett’s investment conglomerate, sold $1.4 billion of its remaining holdings in custody bank Bank of New York Mellon (BK) and Minneapolis regional lender US Bancorp (USB), according to filings.
Buffett has been gradually reducing his holdings in banks over the past few years, selling a significant portion of Berkshire’s US bank holdings between 2020 and 2022. However, he has yet to publicly announce any rescue efforts or new investments in banks during the current crisis.
Despite his cautious approach to bank stocks, Buffett remains positive about Bank of America. Berkshire increased its holdings in the bank by 2% in the first quarter, even though the value of its total position decreased by $4 billion during the quarter. Buffett praised Bank of America’s management during Berkshire’s annual shareholders meeting.
In addition to Bank of America, Buffett invested more in Capital One and raised Berkshire’s stake in Ally Financial. However, the conglomerate sold its position in Jefferies Financial Group and maintained its stake in Citigroup.
Other high-profile investment managers, including Bridgewater Associates, the world’s largest hedge fund, also sold bank shares last quarter. Bridgewater sold around $180 million in bank stocks, including most of its holdings in Bank of New York Mellon and US Bancorp, and divested its positions in 15 other US lenders.
Bank of America, Citigroup, Capital One, and Ally saw their stocks rise, while US Bancorp, BNY Mellon, and Jefferies were down in after-hours trading.
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