Billionaire investor John Paulson disclosed in a regulatory filing his Paulson & Co. hedge fund took a large stake in Citigroup (NYSE: C), while reducing its holdings in JP Morgan Chase (NYSE: JPM) and Goldman Sachs (NYSES: GS).
According to the filing, the New York based hedge fund took a 300 million share position in Citigroup Inc. The addition is the second large purchase of a bank the government holds a substantial stake. Paulson snatched up 168 million shares of Bank of America (NYSE: BAC) during the second quarter of the year.
While adding the large Citigroup position, Paulson’s fund also drastically reduced its position in JP Morgan Chase to 2 million shares, a reduction of 5 million shares from the 7 million it held at the end of the second quarter.
Paulson’s fund also bought 2.75 million shares of Hartford Financial Services (NYSE: HIG) and raised its position in First Horizon National Corp. by more than double to 7.1 million shares from 3 million.
Paulson made roughly $200 billion last year as his company short the big financial stocks and bet against the mortgage market.
The company has made its recent bank purchases through its Paulson Recovery Fund, which was launched in 2008 and focuses on a rebound in the U.S. financial sector.
Paulson & Co. is not the only large fund betting on a banking recovery as Appaloosa Management LP, head by billionaire investor David Tepper, took a 79.7 million share stake in Citigroup during the third quarter.
Paulson ranked second in earnings for fund-managers last year, according to Institutional Investor’s Alpha Magazine.
