Berkshire Hathaway, the investment conglomerate led by Warren Buffett, has sold approximately 33.9 million shares of Bank of America this week, generating roughly $1.48 billion in proceeds. This move follows a series of transactions and leaves Berkshire with approximately 999 million BofA shares, solidifying its position as one of the bank’s largest shareholders.
Berkshire’s initial investment in Bank of America dates back to 2011 when the company purchased $5 billion in preferred stock and warrants to buy 700 million common shares. This investment came at a time when many investors were concerned about the bank’s capital needs.
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While the article doesn’t provide specific reasons for the sale, possible motivations include profit-taking, portfolio rebalancing, or concerns about the broader banking industry. This move may be a strategic decision to realize gains from Bank of America’s stock appreciation since Berkshire’s initial investment.
Berkshire’s diverse investment portfolio includes holdings in other major banks like Wells Fargo and JPMorgan Chase, suggesting that the sale may be part of a broader asset reallocation strategy. The sale also raises questions about the health of the banking industry and its future outlook.
This sale underscores Berkshire Hathaway’s continued presence in the banking sector, despite its recent divestment.