Lansdowne Partners Ltd., the biggest hedge fund in Europe that bets on stocks, bought shares of Bank of America Corp. (BAC) in the second quarter, while reducing its stakes in Wells Fargo & Co. (WFC) and JPMorgan Chase & Co. (JPM)
Lansdowne purchased 5.1 million shares of Charlotte, North Carolina-based Bank of America between April and June, according to a filing with the U.S. Securities and Exchange Commission today. Lansdowne sold 3.7 million shares of Wells Fargo to cut its stake to 28.3 million shares. The hedge fund reduced its JPMorgan holding by 6.8 million shares to 7.1 million shares.
Bank of America, the biggest lender in the U.S., has slumped 46 percent this year as investors question whether rising costs from failing mortgages will force the company to raise capital. Competitors Wells Fargo and JPMorgan have performed better. San Francisco-based Wells Fargo has fallen 22 percent while New York-based JPMorgan is down 15 percent.
A Lansdowne spokesman in London declined to comment. The hedge fund held no shares in Bank of America at the end of the first quarter, according to a May 16 filing with the SEC.
Odey Asset Management LLP, the $7 billion London-based hedge fund started by Crispin Odey, sold 1.38 million shares of UBS AG (UBSN) in the second quarter, reducing its stake to 502,243 shares, according to a filing today with the SEC. Odey sold its entire stake of 938,912 shares of JPMorgan in the period. Chief Executive Officer David Stewart wasn’t available to comment.
Lansdowne, started by Paul Ruddock and Steven Heinz, manages about $14 billion. The U.K. Equity fund, Lansdowne’s biggest, had declined 16 percent this year through Aug. 5, according to a person familiar with the matter. The smaller Global Financials fund, managed by William De Winton, was down about 12 percent through the first week of August, the person said.
Lansdowne’s Bank of America stake is held in the Global Financials fund, according to the SEC filing. The stake is valued at about $38.1 million, according to data compiled by Bloomberg. The biggest holding in the fund by market value is a $188.4 million stake in Citigroup Inc. (C), the data show.
The firm has been hurt this year by its bets on banks, among them Lloyds Banking Group Plc. (LLOY) London-based Lloyds, which is 41 percent owned by the U.K. government, has plunged 50 percent this year. Britain’s biggest mortgage lender posted a first-half net loss of 2.31 billion pounds on Aug. 4 after increasing provisions for bad loans and setting aside funds to compensate customers improperly sold personal-loan insurance.
Goldman Sachs Group Inc. (GS) is among financial companies Lansdowne has sold this year. The hedge fund sold its entire stake of 4.9 million shares in the New York-based firm in the first quarter. Lansdowne has purchased 4.4 million shares of Morgan Stanley (MS) in 2011, according to SEC filings.
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