Warren Buffett’s company is selling a chunk of its Wells Fargo stock to avoid some federal regulations.
Berkshire Hathaway says the sale isn’t tied to the scandal about Wells Fargo’s sales practices that led to the CEO’s departure last year.
The company says it’s selling to keep its stake of the bank below 10 percent to avoid additional Federal Reserve regulations. It will continue selling shares as needed to remain below that threshold.
Berkshire’s holdings crept above 10 percent last year because of Wells Fargo’s stock repurchases.
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Berkshire says it has already sold 7.1 million shares and will sell about 1.9 million more. That will bring its holding to around 491 million shares.
“We appreciate the confidence that Berkshire Hathaway has placed in Wells Fargo over the years, both as our largest shareholder and a very valued customer,” a Wells Fargo spokesman said. “We look forward to continuing our relationship with them.”
In September, Wells Fargo agreed to pay $185 million in fines to settle allegations that thousands of employees created more than 2 million potentially unauthorized customer accounts to meet aggressive sales goals. The scandal has tarnished the bank’s reputation, led to former CEO John Stumpf’s exit and spurred multiple investigations.
On Monday, the bank’s board released a 113-page report that placed blame for the scandal squarely on two departed executives: former community bank head Carrie Tolstedt and Stumpf. Wells Fargo reports first-quarter earnings on Thursday.
Staff writer Rick Rothacker contributed