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