Berkshire Hathaway Inc. has asked the Federal Reserve to allow it to hold as much as 24.99 percent of American Express Co., a stake that’s been growing because of the lender’s stock repurchases.
“This is an application to continue to retain American Express stock, not to buy additional shares,” Marina Norville, a spokeswoman for New York-based AmEx, said in an emailed statement.
Berkshire applied to “increase the percentage ownership cap to 24.99 percent from the current 17 percent as a result of our share-repurchase program,” she said.
AmEx has recently returned “significant amounts of capital to shareholders” through dividends and buybacks, Chief Financial Officer Jeffrey Campbell said on a conference call with analysts last month. The company received approval to repurchase $4.4 billion of its shares during 2016 and an additional $1.7 billion in the first half of 2017, according to a statement last June.
Berkshire, American Express’s biggest shareholder, owned about 151.6 million shares, or 17 percent of AmEx’s stock, as of March 31, according to data compiled by Bloomberg. The stake was valued at about $11.6 billion.
Berkshire disclosed its request to the Federal Reserve in a legal notice in the New York Daily News on Friday.
U.S. regulations have long limited ties between non-financial companies and banks. Investors typically have to tell the Fed and the public before acquiring ownership stakes that exceed certain levels, though that notice can be delayed if the threshold is reached because of share repurchases.
The Omaha World-Herald is owned by Berkshire Hathaway.