Berkshire Hathaway Inc. cut its stake by over 40 percent in Wells Fargo as the U.S. bank deals with the repercussions of consumer-exploitation controversies. The Warren Buffett-controlled holding firm was once the biggest owner of the lender's common shares.

Buffet's conglomerate had already trimmed down its investment in the U.S. lender by around a quarter to approximately 238 million shares in the second quarter this year. Based on a regulatory filing, the conglomerate has offloaded over 100 million shares. A representative for Wells Fargo did not issue any comment.

Berkshire Hathaway has continued to dispose of stocks since then, reducing its investment by another 42 percent to 136 million shares, the filing disclosed. The holdings group currently has a 3.3 percent share in Wells Fargo.

Buffett started pouring an enormous amount of money in Wells Fargo in 1989 but has been cutting the group's stake as the lender struggles to bounce back from a host of wrongdoings over its conduct toward its clients, including the opening of bank accounts without their consent.

The lender has also been hounded by the fallout from its sales controversies in addition to ill effects of the coronavirus crisis and related lockdowns across the country, which have caused its shares to plunge over 50 percent this year.

In July, Wells Fargo said it would slash its dividend. It reported its first loss for the quarter since 2008 in the three months ending June 30 as the bank set aside a whopping $9.5 billion for credit losses.

The lender ranked in the top five of Berkshire's most valuable holdings just a few months earlier. The stock price of Wells Fargo has shed about 55 percent so far this year to just under $25, which means Berkshire's 136 million shares are now valued at about $3.4 billion as of Friday's close.

Meanwhile, Charlie Scharf, the new Wells Fargo Chief Executive Officer, has vowed to reduce $10 billion in yearly expenditures and has initiated a massive retrenchment that could eventually render thousands of the Wells Fargo employees jobless.

Earlier, Moody's Investors Service cut its rating projection on Wells Fargo from "stable" to "negative," citing the lender's slower-than-estimated capacity to resolve corporate governance and key oversight matters from the previous years.

Berkshire Hathaway has been reallotting investments in financials, slashing its shares on JPMorgan Chase and PNC Financial Services Group, and abandoning investment in Goldman Sachs Group while increasing its stake with Bank of America.