Warren Buffett’s stake in Wells Fargo has nearly hit the 10% Fed review level

Warren Buffett - Wells Fargo ownership stake

Warren Buffett is nearing the 10% stake in Wells Fargo & Co. that will require him to pass a Federal Reserve review before he can keep building his stake in the company.

As of December 31 his stake in the company included 506 million shares, or 9.9%, according to regulatory filings uncovered by Bloomberg.

The nearly 10% stake in Wells Fargo is held mostly by Berkshire Hathaway subsidiaries.

At the end of 2009 Buffett’s company owned 6.7%.

When purchasing more than a 10% stake in a bank, investors must notify the Fed and the public. Regulators use those disclosures to review who can control a lender’s future.

The “U.S. has long limited the ties between non-financial companies and banks,” Bloomberg notes.

If an investor can show that they don’t plan to influence a bank or its management, they may be allowed to move forward.

In the 1990s Buffett increased in holding in American Express by more than 10%. To reach that goal he agreed to follow the credit-card lender’s recommendations in voting company shares. Berkshire’s AmEx stake was about 16 percent as of December 31.

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Buffett and the Feds are not commenting on the Wells Fargo stake at this time.