Even if War­ren Buf­fett did not sell Wells Fargo, why he might not have bought more ei­ther

Financial Mirror (Cyprus) - - FRONT PAGE -

There has been a lot to con­sider about Wells Fargo & Co. (NYSE: WFC) since its ac­count-open­ing scan­dal broke. One top con­sid­er­a­tion is that we now know about War­ren Buf­fett’s stance from Berk­shire Hath­away Inc. (NYSE: BRK-A). It turns out that Buf­fett stuck by his largest pub­lic bank stake.

When this scan­dal was break­ing, Buf­fett was re­port­edly not happy with how CEO John Stumpf han­dled the mat­ter. Whether Buf­fett played a role in this out­come may never be known. Re­gard­less what the com­pany and Buf­fett (and even Stumpf) may say in pub­lic, the re­al­ity is that the scan­dal and how it was han­dled cost Stumpf his job as chief ex­ec­u­tive at Wells Fargo.

In an in­ter­view on CNN last Fri­day, Buf­fett con­firmed that he had not sold any Wells Fargo shares. What is not known is whether Berk­shire Hath­away added shares. Buf­fett and his team ap­plied ear­lier this year for their own­er­ship to rise above the 10% reg­u­la­tory hur­dle. That may not ac­tu­ally re­quire more share buy­ing be­cause of the Wells Fargo buy­back plans, and Buf­fett had asked in that ap­pli­ca­tion ear­lier in 2016 to re­main a pas­sive stake­holder.

Berk­shire Hath­away owned just over 479.7 mln shares of Wells Fargo as of June 30, 2016. That was a 9.51% stake. Sadly, we may not know just how ac­tive Berk­shire Hath­away got around the share price weak­ness for an­other quar­ter or so. The rea­son is that the 13F-HR fil­ing this week comes with a Septem­ber 30, 2016 cut­off date.

Newspapers in English

Newspapers from Cyprus

© PressReader. All rights reserved.