Berkshire Hathaway sells Bank of America shares again, but the pace of selling slows down, Bank of America CEO praises Buffett as a great shareholder

Berkshire Hathaway, owned by Warren Buffett, has sold nearly $228.7 million worth of Bank of America stocks in the past three days.

According to the latest regulatory filings, Berkshire Hathaway sold 5.8 million shares of Bank of America stock from last Friday to this Tuesday, with a total value of nearly $228.7 million and an average selling price of $39.45 per share. This is one of the lowest prices since Buffett started reducing his holdings in mid-July. Berkshire Hathaway's selling streak has now lasted for 12 consecutive trading days, matching the period from July 17 to August 1.

Since Buffett started reducing his holdings nearly two months ago, Berkshire Hathaway has sold over 174.7 million shares of Bank of America stock, totaling $7.2 billion. Currently, Berkshire Hathaway holds 858.2 million shares of Bank of America, accounting for 11.1% of outstanding shares. This position has dropped to the level of 2018, with these shares valued at approximately $33.7 billion based on the closing price of $39.28 on Tuesday. Bank of America's holdings have fallen to Berkshire's third-largest position, following Apple and American Express. Bank of America was previously Berkshire's second-largest holding before the massive sell-off.

It is worth noting that analysts point out that the recent three-day sell-off has slowed significantly compared to the previous eight rounds of selling, suggesting that Buffett may be reducing his stake in Bank of America to below 10% to avoid ongoing reporting obligations.

Bank of America CEO Praises Buffett as a Great Shareholder

It is well known that Buffett purchased $5 billion worth of Bank of America preferred stock and warrants after the 2011 financial crisis. He converted these warrants in 2017, making Berkshire Hathaway the largest shareholder of Bank of America. Around 2018 and 2019, he further increased his holdings by 300 million shares.

Bank of America CEO Brian Moynihan made rare comments on Buffett's selling behavior at the Barclays Global Financial Services Conference. He stated that while he does not know the specific reasons for Buffett's stock sales, he highly appreciates Buffett's investment in Bank of America after the 2011 financial crisis, believing that Buffett's investment helped stabilize the bank, which was struggling due to losses related to subprime mortgages at the time. Moynihan said, "Buffett is a great shareholder of our company and stabilized our company when we needed it."

Moynihan, who has been the CEO of Bank of America since 2010, highlighted how profitable Buffett's investment has been by mentioning that investors who followed Buffett's lead at the time of purchase could have bought in at a low price of $5.50 per share, while the stock is currently trading slightly below $40 per share. Moynihan added, "He just had the courage to do it in a big way. It's a great return for him. We're glad he's getting that return." As of the close on Tuesday, Bank of America's stock price has only fallen by about 1% since early July, but has risen by nearly 16.7% so far this year, slightly higher than the return of the S&P 500 index during the same period.