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Finding Buffett Banks

Richard J. Parsons profile picture
Richard J. Parsons


  • Warren Buffett once owned a highly profitable, ultra-safe Illinois bank from 1969-1980. Regulators made him sell it, much to his chagrin.
  • When recently analyzing another Illinois community bank, HBT Financial, I researched Buffett's shareholder letters from 1969-1980 to see if he had insights that could help in my HBT analysis.
  • My review of Buffett's letter reveals six factors behind his passion for Illinois National Bank. These factors are as important today for bank investors as they were in the 1970s.
  • This post identifies the six factors. It closes by identifying 16 community banks that could be on Berkshire's Buy List if Buffett was not constrained by Federal banking laws.
  • My next five articles will countdown the best five Buffett Banks, including the names of the community banks I am currently adding to my Long-Term Buy-and-Hold Bank Portfolio.

"Breaking Bad" NY Premiere 2013

Andrew H. Walker/Getty Images Entertainment

When Warren Buffett Owned a Bank

I recently made the decision to begin accumulating shares in HBT Financial, Inc (HBT), a $4.2 billion community bank doing business in Illinois and Iowa. Here is a link to

This article was written by

Richard J. Parsons profile picture
Richard J. Parsons is a former banker who writes about the banking industry as well as market risk. He is currently working on his third book about banks. His first book, "Broke: America's Banking System" (2013, RMA), describes why the industry is prone to catastrophic cycles that produced 3,000 bank failures in the U.S. between 1985 and 2012. The second book, "Investing in Banks" (2016, RMA) examines why a small group of elite banks of all sizes consistently overperform the industry over time and through the ups and downs of business cycles. The new book will update "Investing in Banks" with data from 2016-2021. Parsons is a frequent contributor to The Risk Management Journal. He teaches the Advanced Operational Risk Management course for the RMA. Prior to writing and speaking about the banking industry, Parsons spent more than 31 years at Bank of America where he was an executive vice president and member of the Management Operating Committee. In his last role he chaired the bank’s Operational and Compliance Risk Committee and the Emerging Risk Committee. Parsons has a BA in history from Ohio Wesleyan University and an MBA from the University of Virginia Darden School of Business.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of BRK.B, HBT, SYBT, FMCB, FFIN, CBSH either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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