Warren Buffett’s Berkshire Hathaway has slashed its large holdings of Bank of America stock. In a regulatory filing made this week, Berkshire revealed the conglomerate sold 34 million BofA shares for $1.48 billion.
The sale comes after the BofA stock jumped 7.28% this past month and is 26.55% up year-to-date at its Friday’s close price of $42.90 per share.
Berkshire still has plenty of Bank of America shares on its portfolio. It is estimated that the company owns another 998 million shares worth more than $42 billion in the bank, being one of its largest shareholders.
Berkshire initially purchased $5 billion of BofA’s preferred stocks while also getting the rights to buy 700 million common stocks. The investment came at a time when there were worries about whether the bank had enough capital in the aftermath of a financial crisis.
Sizeable financial commitment by Berkshire proved to be beneficial for BofA and was seen as a vote of confidence from the standpoint of other investors and clients. The bank soon recovered, and its stock surged, creating a huge profit for Berkshire.
In its recent second-quarter report, Bank of America beat analysts’ expectations with 0.83% earnings per share and revenue of $25.54 billion.