Warren Buffett's retreat from Bank of America: Billionaire's motives analysed

Warren Buffett is all over the headlines for unloading shares of Bank of America Corp. for the twelfth consecutive session, trimming his conglomerate's huge stake in the lender to 8.8 per cent since mid-July, with a total reduction of $3.8 billion. According to a regulatory filing late Thursday, Berkshire Hathaway Inc. had its latest series of sales to the tune of $779mn after offloading stock from July 30 to August 1. Despite such disposals, it still retains over 942 million shares of the Charlotte, North Carolina-based bank, valued at $37.2 billion as of the latest closing price.

He has not disclosed his reasons and intentions for trimming this highly profitable investment. Buffett's original investment in Bank of America was when the stock changed hands at around $5 in 2011. The shares had surged in momentum over the past several months before this recent selling spree, having gained 31 per cent this year before sliding over 10 per cent to $39.50, in line with the KBW Bank Index.

The continuing dispositions have been among Buffett's largest divestiture of an investment long believed to be an endorsement of Bank of America Chief Executive Officer Brian Moynihan. In his public remarks over the years, which are sparse for the 93-year-old billionaire, Buffett has specifically cited his appreciation for Moynihan. This retreat raised the question of what caused Buffett to summarise his writings by reducing his stake in a long-term investment that he otherwise held on to.

A representative for Berkshire didn't immediately respond to a message seeking comment outside normal business hours. A Bank of America spokesperson declined to comment.

Warren Buffett has cast interest and speculation among many investors and analysts by gradually selling his stake in Bank of America. With the legendary investor still tight-lipped over his intentions, the development simply brings to the surface the complexities and considerations involved in managing a multibillion-dollar investment portfolio. With further actions to be rolled out by Buffett, the financial world will not fail to keenly watch for every hint on his future investment strategy and plans.