HomeFinancial MarketsBofA’s CEO Doesn't Know Why Warren Buffet is Reducing His Stake

BofA’s CEO Doesn’t Know Why Warren Buffet is Reducing His Stake

Warren Buffet’s multinational conglomerate Berkshire Hathaway recently continued to reduce its stake in Bank of America, selling $760 million worth of shares in early September. This brought Berkshire’s sales of BofA’s stock to around $7 billion since July.

No one really knows why Buffet and Berkshire are parting ways with their BofA holdings, including the bank’s CEO Brian Moynihan.

In a recent speech at an investor conference, Moynihan said that he doesn’t know the motivation behind Buffet’s decision. Buffet initially started investing in BofA in 2011, buying $5 billion of the bank’s preferred stock. This helped the company to bounce back from a rough period after the 2008 financial crisis.

“He has been a great investor for our company, stabilized our company,” Moynihan said about Buffet. “I don’t know what exactly he is doing because frankly we can’t ask.”

Despite recent sales, Berkshire is still BofA’s largest shareholder, with an 11.1% stake. Some experts believe that the company intends to get its stake under 10%, after which it wouldn’t be required to report sales.

BofA’s stock dropped by more than 10% after Berkshire reported its first sale in July. However, the company’s shares still remain 16.05% up year-to-date at the price of $39.34 per share.

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