Legendary stock picker Warren Buffett says he's buying more stocks in U.S. financial institution Wells Fargo.

Buffett has said in the past that if he were to own stock in just one bank, it would be Wells Fargo.

"In the last week I bought some Wells Fargo," Buffett told CNBC. "We only have 430-some-million shares, I didn't feel we had enough."

Plus now is a great time to buy stocks.

"Basically I like to buy, so if the market is down, I'm happier buying," the Berkshire Hathaway chief executive officer said.

"If I go to the supermarket and they reduce prices, I feel better. If I go to a men's clothing shop and they reduce prices, I feel better, so if I go to the stock exchange and they reduce prices, I still feel better."

Banking stocks won't provide the same returns on equity prior to the credit crisis though the financial industry is still a good business.

"You won't be able to earn more on assets than before, and so with less leverage and the same return on assets, you'll have a lower return on equity," Buffett said.

"Banks were earning 25 percent on tangible equity not so many years ago, and, really, that's kind of a crazy number for a basic semi-commodity business, you really don't want to allow that," Buffett added.

"It's a good business, but it won't get back to what it was."

Wells Fargo reported record earnings during the third quarter due to increased mortgage lending and more business from fees.

Third-quarter net income rose 23 percent on year, to $4.72 billion from $3.84 billion.

Revenue rose 8 percent on year to $21.21 billion

“Through the efforts of our more than 265,000 team members, we've now achieved six consecutive quarters of record net income and EPS,” Chairman and CEO John Stumpf said in a third-quarter earnings statement.

Like Buffett, Stumpf said he has noticed an improving housing sector.

"Real estate is getting better," Stumpf said on a call with analysts, according to the Associated Press.

"We saw it in housing, and every quarter we have more confidence."