Basswood Capital Management LLC's financial stock holdings increased to $1.99 billion as of March 31, up nearly 7% from year-end 2017, according to the company's latest Form 13F filing.

The hedge fund manager increased its investment in both of its largest holdings, Ally Financial Inc. and Wells Fargo & Co., by 3.8% and 38.3%, respectively, even as both stocks declined in the first quarter.

Similarly, Basswood bulked up on Capital One Financial Corp. by 48.5%, making the superregional bank its 11th-largest position as the company's shares lost ground during the quarter.

The activist investor disclosed 26 new investments worth a combined $109.1 million as of March 31, including 19 banks, four financial technology companies, two thrifts and a broker/dealer. Basswood's largest entry, an $18.9 million stake in Santa Rosa, Calif.-based Luther Burbank Corp., began trading on the Nasdaq in December 2017.

Basswood also revealed a $4.7 million investment in Bloomington, Minn.-based Bridgewater Bancshares Inc., which completed an initial public offering on March 14. The stock has since returned 10.64% as of May 15.

Basswood completely exited positions in seven banks and three thrifts during the quarter that had been worth a combined $67.7 million at the end of 2017. Basswood's largest exit was an $18.6 million stake in Reston, Va.-based WashingtonFirst Bankshares Inc., which was acquired by Olney, Md.-based Sandy Spring Bancorp Inc. on Jan. 1. Subsequently, Basswood's shares in Sandy Spring increased by 82.5% in the first quarter, making the bank Basswood's 17th-largest position at $33.7 million as of March 31.

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