Warren Buffett’s Berkshire Hathaway (NYSE: BRK-B) cutting its exposure to municipal bonds and high-yield corporate debt has some bond ETF investors taking another look at the sectors’ credit risks.

Berkshire recently terminated half its bullish $16 bet on municipal bonds and has also cut its exposure to speculative-grade corporate debt, according to a regulatory filing, Reuters reports.

The company recently terminated credit-default swaps insuring $8.25 billion of municipal debt, according to the Wall Street Journal.

San Bernardino recently became the third municipality in California to file for bankruptcy and analyst Meredith Whitney is back in the news with a prediction that local governments are nearing a financial “inflection point” that could result in not honoring their debt obligations. [Are Muni Bond ETFs Facing an ‘Inflection Point?’]

“The move comes as many investors including Berkshire Chairman, billionaire investor Warren Buffett, foresee an uptick in U.S. municipal bankruptcies,” Reuters reported Tuesday. “Buffett said last month that the bankruptcies of three California cities in as many weeks was making traditionally objectionable Chapter 9 municipal bankruptcy filings more palatable to local governments in financial crises.” [Muni Bond ETFs For Liquidity and Yield]

The iShares S&P National Municipal Bond Fund (NYSEArca: MUB) was fractionally lower Tuesday. The ETF has a 30-day SEC yield of 1.77%, according to manager BlackRock. [Tax Break Makes Muni Bond ETF Yields More Attractive]

Aside from more potential bankruptcies, rising interest rates are a risk for muni bond ETF investors. Funds holding muni bonds with longer durations are more sensitive to rising interest rates.

Berkshire also reduced its exposure to CDS backed by high-yield corporate debt in the first half of the year, to $3.26 billion, from $4.57 billion at the end of 2011, Reuters reported.

High-yield corporate bond ETFs have been popular in 2012 with investors trying to increase income. SPDR Barclays High Yield Bond (NYSEArca: JNK) and iShares iBoxx High Yield Corporate Bond (NYSEArca: HYG) have each netted inflows of more than $300 million the past month. [Investors Chase Yield, Risk in Junk Bond ETFs]

Full disclosure: Tom Lydon’s clients own JNK and HYG.