JPMorgan Chase and Bank of America are the two largest US commercial banks by assets, competing directly across consumer banking, commercial lending, investment banking, and wealth management. Their rivalry defines US banking: JPMorgan leads in investment banking market share while BofA leads in certain consumer deposit segments.
Why it matters: JPMorgan's $3.9T in assets and $50B+ annual profit makes it the most profitable bank in history. BofA's $3.3T in assets and 4,000+ branch network make it the dominant retail bank in many US markets. Competition between them drives pricing, service innovation, and talent across Wall Street.
Berkshire Hathaway owns approximately 9.49% of Bank of America's common shares, representing approximately 680 million shares worth approximately $26B as of Q4 2025. Berkshire originally acquired warrants in BAC in 2011 during the financial crisis at $5/share, earning billions in unrealized gains. Buffett began selling BAC shares in 2024-2025, reducing the position from its peak of approximately 12% ownership while still maintaining a top-5 Berkshire holding.
Why it matters: The 2011 BAC investment was structured as preferred stock plus warrants, giving Berkshire downside protection and upside participation during a time of regulatory uncertainty following the financial crisis. BAC's deposit franchise, consumer banking scale, and Merrill Lynch wealth management division fit Buffett's preference for businesses with sticky customer relationships and low-cost capital sources. The US banking system's recovery from 2011-2025 generated exceptional returns on this investment thesis.