Warren Buffett, one of the world’s most influential investors, has reduced Berkshire Hathaway’s stake in Bank of America (BofA) to below 10%. This allows Buffett to make future trades in the bank’s stock with much less transparency, as he is no longer bound to report them immediately. This move follows a string of stock sales that began in mid-July. During which Buffett’s firm earned around $10.5 billion by trimming its BofA holdings.
Until now, Buffett was compelled by U.S. regulations to disclose these trades within a few days. However, with the stake reduced to 9.99%, he now only has to report changes quarterly. Potentially keeping investors in the dark for months if more shares are sold. The bank’s stock has struggled since the sell-offs began. While BoA had been performing well earlier this year, ranking at the top of the KBW Bank Index in July, it has since slipped to become one of the worst performers. In the latest round of sales, Berkshire unloaded nearly $382 million worth of shares in just three days.
Some analysts, like Piper Sandler’s Scott Siefers, believe that with Berkshire’s stake now below 10%, the ease on the stocks could possibly give it a chance to regain momentum. Investors had been watching Buffett’s moves closely, as Berkshire Hathaway remains the largest shareholder in Bank of America, with a stake still valued at approximately $31 billion.
Despite the sell-offs, Berkshire Hathaway’s remaining position in the bank is still substantial. The company has already made back more than it originally spent to acquire the shares. However, Buffett’s reduced disclosure requirements may leave investors guessing about his future intentions with Bank of America for months at a time.
