Buffett Dumps Citi — Why He Keeps Selling Bank Stocks
Berkshire’s long-awaited 13F filing is out, and we now know what Buffett did in Q1 2025.
While most headlines may highlight the doubling of his stake in Constellation Brands (STZ), a more important – and concerning – trend is Buffett’s continued reduction in bank holdings.
The most eyebrow-raising sale this quarter? Berkshire fully exited Citigroup. Just last quarter, it was still holding a ~$1 billion position. It also sold off its remaining ~40 million shares of Brazilian fintech Nu Holdings, completely exiting that too. Bank of America – still Berkshire’s second-largest holding – was trimmed by 48.6 million shares. These sales continue a multi-quarter trend of Buffett pulling out of banks.
Timeline: Berkshire’s Exit from Bank Stocks
Buffett didn’t dump banks overnight. The process has played out over several years, almost quarter by quarter. Here’s how it happened:
Wells Fargo (WFC): Last shares sold by Q1 2021. Ended a 30-year bet.
Goldman Sachs (GS): Fully exited by mid-2020, during the pandemic.
JPMorgan Chase (JPM): Fully exited in Q4 2020.
PNC Financial (PNC): Bought in 2018–2019, fully exited by Q4 2020.
M&T Bank (MTB): Gradually reduced, no longer appeared in 13Fs after 2021.
Bank of New York Mellon (BK): Fully exited by Q1 2023.
U.S. Bancorp (USB): Fully exited by Q1 2023.
Ally Financial (ALLY): Entered in Q1 2022, exited by year-end.
Citigroup (C): Bought in 2022, trimmed in 2023, fully sold in Q1 2025.
Back in 2019, bank stocks made up almost a third of Berkshire’s stock portfolio. Bank of America alone was 13.5%, Wells Fargo 7.2%, and the rest added up to around 29%.
Fast forward to today – and banks now make up less than 10% of the portfolio. The drop is drastic, and intentional.
Why Is Buffett Selling Banks?
Buffett and Munger were once known as long-time bank bulls. What changed?
#1 Erosion of trust in management
This point pertains to Wells Fargo. Buffett had defended the bank for years – even as others criticized it for the fake-accounts scandal back in 2016. But the slow and disappointing cleanup wore him down. What once seemed like a one-off mistake became a culture problem. By 2020, Buffett had enough. Berkshire began selling Wells Fargo at an unprecedented pace. Munger later explained it bluntly: the toxic culture made Buffett “disenchanted.”
#2 Chasing short-term gains, ignoring long-term discipline
In an April 2023 interview after the regional bank failures, Buffett explained why he had exited most banks.
“I don’t like it when people get too focused on the earnings number and forget what in my view is basic banking principles,” he said.
This wasn’t just a passing comment. It tells us Buffett was seeing something deeper – CEOs pushing for earnings growth at the expense of prudence. Aggressive lending, inadequate capital buffers, poor risk management.
He warned more banks could fail over time simply because “some managers will continue to do dumb things” to boost short-term profits.
The collapses of Silicon Valley Bank and others in 2023 confirmed his fears. They had taken excessive duration risk, ignored rate volatility, and paid the price.
Buffett has always liked banks for their steady, predictable earnings. But when those earnings start being engineered instead of earned, he gets cautious.
#3 Regulatory constraints and ownership limits
Some of Buffett’s trims were due to regulatory caps. He’s required to stay below 10% ownership in certain banks unless he wants to be subject to stricter regulatory oversight. This was the case with Wells Fargo during 2018–2019, and with BofA in the past. For example, when Wells was buying back shares, Berkshire’s percentage was rising unintentionally, and Buffett had to sell to stay compliant. But these were minor moves. The major selling started when he lost conviction – not because of any regulation.
#4 Still bullish on BofA – just not the rest
Importantly, Buffett hasn’t dumped all banks. He’s just become very selective. And his actions show that Bank of America stands out as the only one he still trusts.
He added to BofA in 2020 when markets were panicking. In fact, regulators gave Berkshire approval to exceed the 10% threshold, and Buffett immediately bought ~$2 billion more. He praised CEO Brian Moynihan for strong leadership and a conservative deposit base – exactly what Buffett wants in a bank.
So this isn’t a blanket “no” to bank stocks. It’s Buffett saying, “I only want the ones I understand and trust.” The ones that didn’t meet that standard – Wells, Citi, Goldman, JPM, USB, PNC – were sold off. BofA stayed.
At the 2023 shareholder meeting, Buffett summed it up well:
“Banks can be a perfectly good investment... but when the economy goes into a recession, banks can have a lot of problems.”
What it means for investors
Banking is still a critical part of the economy. After years of low interest rates, many banks are now enjoying higher margins. But Buffett’s actions serve as a warning – don’t get too comfortable. When the cycle turns, loan books can go bad fast. And in banking, when trust or capital is lost, recovery isn’t guaranteed.
Also, not all banks are equal. Some are better managed, more conservative, and more aligned with long-term thinking. Buffett has made it clear who he trusts – Bank of America.