Berkowitz's Fairholme Cuts Regions Financial Position in Half ~ market folly

Wednesday, October 12, 2011

Berkowitz's Fairholme Cuts Regions Financial Position in Half

Bruce Berkowitz's Fairholme Capital filed an amended 13G with the SEC regarding shares of Regions Financial (RF) and disclosed they now have a 4.8% ownership stake in RF with 60,568,917 shares.

The SEC filing was made due to activity on September 30th and marks a 51% reduction in Berkowitz's position. The last time we covered Berkowitz was at the Harbor Investment Conference where he said there was black box risk to owning banks but that after three years you can get an idea of who's going to do well.

Fairholme also owns stakes in other financials like AIG (AIG), Citigroup (C), Bank of America (BAC), Goldman Sachs (GS), and CIT Group (CIT). In our Hedge Fund Wisdom premium newsletter, we outlined the investment thesis on AIG as Berkowitz has pressed his bet there and it is by far his largest position at over 20% of his portfolio.

Per Google Finance, Regions Financial is "a financial holding company. The Company operates throughout the South, Midwest and Texas. Regions provides traditional commercial, retail and mortgage banking services, as well as other financial services in the fields of investment banking, asset management, trust, mutual funds, securities brokerage, insurance and other specialty financing."

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