Warren Buffett’s Berkshire Hathaway finally quits Wells Fargo | CNN Business

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Warren Buffett’s Berkshire Hathaway has been one of Wells Fargo’s top investors in recent years, despite the company’s fake account scandal, overloading foreign exchange customers and a myriad of other issues.

Now the Oracle of Omaha has finally thrown in the towel.

Berkshire Hathaway (BRKB) revealed Monday evening that it sold its remaining stake in Wells Fargo (WFC) during the first quarter, according to the conglomerate’s latest filing with the Securities and Exchange Commission. Shares of Wells Fargo (WFC), however, rallied against those of other banks on Tuesday.

Berkshire still held a small stake in Wells Fargo at the end of the fourth quarter of 2021, but had gradually reduced the position since 2019. Many Berkshire investors had pressured the company to sell all of its stakes in the bank, arguing that his persistent problems were a stain on Berkshire.

Wells Fargo critics have often cited Buffett’s comments during a 1991 congressional hearing on issues with Wall Street investment bank Salomon Brothers. Buffett was an investor in Solomon at the time and later became its chairman following a bond-trading scandal that led to the ousting of several top executives.

“Losing money for the business, and I’ll be understanding; lose an ounce of reputation for the company, and I will be ruthless,” Buffett said during the hearing.

Berkshire can now be done with Wells Fargo, but the company is still invested in many other major banks and financial companies. Bank of America (BAC) and American Express (AXP) are currently two of Berkshire’s top four stocks. Buffett’s company also owns insurance giant Geico and several other financial services subsidiaries.

Berkshire also made a new purchase of more than 55 million shares in Wells Fargo rival Citigroup (C) during the first quarter, a stake worth about $3 billion at the end of the quarter. Shares of Citigroup (C) jumped nearly 8% on the news. Berkshire bought a small stake in Ally Financial (ALLY) during the quarter.

Buffett manages the portfolio with two other top Berkshire investment managers, Ted Westchler and Todd Combs, who is also the CEO of Geico. This triumvirate shakes up Berkshire’s investments.

In addition to its stakes in Citigroup and Ally, Berkshire also bought new positions in CBS owner Paramount Global, chemical company Celanese (CE), healthcare giant McKesson (MCK) and insurer Markel (MKL). during the quarter. Shares of all four stocks rose on Tuesday, with Paramount climbing 14% and Celanese (CE) gaining 8%.

Berkshire has also reduced its position in telecommunications giant Verizon (VZ) and now has only a small stake in the company. Verizon (VZ) stock was flat.

Berkshire also confirmed some previously disclosed investments in the SEC filing that Buffett discussed at Berkshire’s shareholder meeting in late April, including an increase in his stakes in oil giants Chevron (CVX) and Occidental Petroleum (OXY). and a bigger bet on Activision Blizzard. (ATVI), the video game maker that Microsoft (MSFT) is considering buying.

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