Billionaire investor Warren Buffet’s Berkshire Hathaway has sold its remaining stake in US banking group Wells Fargo.
Wells Fargo has been part of Buffet’s portfolio for over three decades and the divesture comes as the bank’s CEO Charlie Scharf deals with regulatory hurdles and considers steps including the sale of businesses to improve efficiency.
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In September last year, US Senator Elizabeth Warren urged the Federal Reserve to revoke Wells Fargo’s status as a financial holding company, which has paid billions in fines.
The development followed Wells Fargo receiving a civil money penalty of $250m for violating a consent order.
Concurrently, during the first quarter of 2022, Berkshire Hathaway built its holding in Wells Fargo’s rival, Citi, and auto lender Ally Financial.
Berkshire Hathaway acquired around 2.8% stake in Citi worth approximately $3bn.
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By GlobalDataMarkets across the globe have plummeted, which has impacted the valuation of technology firms, banks and consumer-facing entities.
In 2022, Citi has slumped more than 21% and is behind the average financial sector stock in the S&P 500 index, which has dropped 16% this year.
Currently, Citi is restructuring its global operations to boost profitability by selling retail banking business across several markets and focusing on institutional banking business.
Last month, Citi announced that it has set aside nearly $2bn to offset the losses from its exposure to Russia.
