The banking industry now makes up over 40% of Warren Buffett’s portfolio

Berkshire Hathaway reported its Q3 holdings last week, and half of Warren Buffett’s top 10 largest holdings are in the US banking industry.


November 21, 2018

Berkshire Hathaway reported its Q3 holdings last week, and it looks like Warren Buffett’s laughing all the way to the bank: Half of Warren Buffett’s top 10 largest holdings are in the US banking industry.

BH purchased $13B worth of new bank stocks last quarter alone, bringing the firm’s total banking investments to $86B.

Here’s how that $86B breaks down:

  • Bank of America $25.8B
  • Wells Fargo $23.3B
  • American Express $16.1B (17% stake)
  • US Bancorp $6.6B
  • Goldman Sachs $4.1B
  • JPMorgan Chase $4B
  • Bank of New York Mellon $4B
  • M&T Bancorp $866m
  • PNC $829m
  • Synchrony Financial $647m

To put that in context, BH’s stake in Bank of America is the firm’s second largest holding (behind Apple at $56.9B).

Why is he banking on banks?

Because, theoretically, it’s a “forever business” — one that we’ll always need as long as traditional currency exists. 

*Cue uproar from one million blockchain enthusiasts*

And, he’s managed to invest a massive amount of capital in a single industry without triggering the feds. 

Aside from its American Express holding, all of BH’s investments are under 10% ownership to avoid regulatory oversight (The Motley Fool points out that it has special permissions from the Federal Reserve to own up to 25% of American Express).

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