David Einhorn bet on two regional lenders last quarter, a period when bank failures shook markets.
The legendary hedge fund manager snapped up shares in First Citizens and New York Community Bank.
“Big Short” investor Michael Burry also piled into several regional lenders in the first quarter.
Legendary investor David Einhorn joined other big names by buying shares in two regional lenders last quarter, likely after the collapse of Silicon Valley Bank in March led to widespread panic.
His hedge fund, Greenlight Capital, snapped up just under 2.3 million shares in New York Community Bancorp and another 22,550 shares in First Citizens Bancshares over the three months ending March 31, a Securities and Exchange Commission filing revealed on Monday.
Neither of the stocks made up a large part of Einhorn’s portfolio, but both have performed strongly this year. The pair of banks shored up their deposits after a wave of withdrawals in March led to the collapse of several rivals.
New York Community’s Flagstar subsidiary acquired collapsed lender Signature Bank on March 19, while First Citizens took over SVB a week later. Both deals were brokered by the Federal Deposit Insurance Corporation.
North Carolina lender First Citizens’ shares have surged 67% in 2023, while Hicksville, NY-based New York Community has jumped 20%.
Those gains are in sharp contrast to the broader regional banking sector’s big losses, with SPDR’s sector-tracking S&P Regional Banking ETF down 36% year-to-date.
Einhorn isn’t the only prominent investor who appears to have seen last quarter’s banking turmoil as a buying opportunity.
“Big Short” legend Michael Burry also scooped up shares of smaller banks in the first quarter of the year, building stakes in First Republic, Pacific Western, Western Alliance, New York Community, and Huntington Bank.
Einhorn’s hedge fund also bought more shares in Gulfport Energy, Tenet Healthcare, and business services firm Concentrix last quarter. On the other hand, it closed its positions in 23andMe, PaySafe, and TMC The Metals Company.
Read more: First Citizens just bought Silicon Valley Bank – here’s everything you need to know about the latest twist in the banking turmoil
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Source: https://finance.yahoo.com/news/david-einhorns-greenlight-capital-snapped-171448439.html