OMAHA, Nebraska - Warren Buffett criticized the government's stress tests of 19 large U.S. banks for failing to account for strengths in lenders' business models, and said he would buy more shares of three big banks in the portfolio of his Berkshire Hathaway Inc.
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"The question is whether the people conducting tests have a bunch of markers" to write down a variety of assets, requiring new capital, Buffett said at a press conference. "You get the impression from reading it there will be percentage whacks (at various assets). That is not a very sophisticated way of looking at it.
"To call those 19 banks too big to fail is wrong," Buffett added. Most, he said, "would find a home if the FDIC decided to move on them."
Buffett said three banks in which Berkshire already has shares, Wells Fargo & Co, U.S. Bancorp and M&T Bank Corp, do not need more equity capital, and "we would buy stock in any of the three banks at present prices."
He expressed no opinion on the capital needs of another Berkshire holding, SunTrust Banks Inc.
Wells Fargo, U.S. Bancorp and SunTrust are among the banks being tested to gauge whether they need more capital to survive a deep recession. M&T is not being tested.
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