David Tepper, the founder of hedge fund Appaloosa Management LP, cut his stake in Bank of America Corp. (BAC) by 42 percent in the second quarter, before the stock fell today to a two-year low, according to a regulatory filing.
Appaloosa held 10 million shares of the Charlotte, North Carolina-based bank as of June 30, compared with 17.2 million at the end of the first quarter, a filing today with the U.S. Securities and Exchange Commission showed. The bank declined 18 percent in the second quarter.
Bank of America fell to its lowest level since April 2009 in New York trading after American International Group Inc. disclosed plans to sue the company over faulty mortgages and analysts speculated about a capital-raising effort.
The bank slid $1.52, or 19 percent, to $6.65 as of 2:30 p.m. in New York Stock Exchange composite trading, after falling as much as 23 percent. It was the biggest drop since April 2009, and left the stock with a loss of about half its value since the start of this year.
A telephone message left for Tepper, whose firm is based in Chatham, New Jersey, wasn’t immediately returned.
Bank of America was Tepper’s fourth-largest U.S. stock holding in the first quarter. It was his second-largest position decrease in the second quarter, after Hewlett-Packard Co., according to data compiled by Bloomberg.
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