Paulson cuts his big bet on banks

Hedge fund manager John Paulson, who made billions by betting against subprime mortgages, has begun to exit the large positions he took in the hard hit banking sector last year.

Since the beginning of the recovery, Paulson's Paulson & Co has bet big on US banks, riding the wave as the country's largest institutions rebounded to strong profits. But Paulson's conviction in the sector began to waver in the third quarter, with the manager reducing his stake in Bank of America from 168m shares to 138m, and cutting Citigroup from 507m to 424m. He has also lowered his stake in Wells Fargo from 17.5m shares to 15.5m, in an opposite move to Warren Buffett's Berkshire Hathaway. He has also cut JPMorgan Chase from 7m shares to 5m, and sold off his 1.1 million shares in ...