Buffett buys more Bank of America stock, with stake’s value rising to $29 billion
Berkshire Hathaway owns more than 10% of Bank of America’s shares outstanding to increase its lead as the largest shareholder
Bank of America Corp. is by far Warren Buffett’s favorite bank, as his Berkshire Hathaway Inc. has boosted its stake in the moneycenter bank to more than $29 billion.
In a Form 3 filing with the Securities and Exchange Commission late Thursday, Berkshire Hathaway disclosed that it owned 950.0 million shares of Bank of America, or more than 10% of the common shares outstanding. Buffett is Berkshire’s chairman and chief executive officer.
That’s up from a previous disclosure of a 896.2 million-share stake, or about 9.4% of the shares outstanding, as of March 31.
Berkshire has extended its lead as the Bank of America’s largest shareholder. The Vanguard Group is the second largest shareholder at about 6.4%, followed by SSgA Funds Management Inc. at 4.1%, according to FactSet.
Bank of America’s stock BAC, surged 1.7% in afternoon trading Friday toward a 10-month closing high. At current prices, Berkshire’s stake would be valued at $29.32 billion.
That is well above the value of Berkshire’s second-largest bank holding, as the 409.8 million shares of Wells Fargo & Co. WFC ,it owns is currently worth about $20.14 billion.
One way Buffett built his stake in BofA was by exercising warrants that were acquired as part of a deal announced in August 2011, in which he invested $5 billion in preferred stock that paid a 6% annual dividend at a time the bank was struggling to return to health in the aftermath of the 2008-2009 financial crisis-crony capitalism at it's FINEST!
That dividend yield was nearly triple the yield on the 10-year Treasury note at the time.
The following table shows Berkshire’s common-share holdings of banks other than Bank of America as of March 31, according to Berkshire’s latest 13F filing in May. The next 13F is due in mid-August.
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