Lehman Brothers

Defunct American financial services firm / From Wikipedia, the free encyclopedia

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Lehman Brothers Inc. (/ˈlmən/ LEE-mən) was an American global financial services firm founded in 1850.[2] Before filing for bankruptcy in 2008, Lehman was the fourth-largest investment bank in the United States (behind Goldman Sachs, Morgan Stanley, and Merrill Lynch), with about 25,000 employees worldwide.[3][4] It was doing business in investment banking, equity, fixed-income and derivatives sales and trading (especially U.S. Treasury securities), research, investment management, private equity, and private banking. Lehman was operational for 158 years from its founding in 1850 until 2008.[5]

Quick facts: Trade name, Company type, Traded as, Industry...
Lehman Brothers Holdings Inc.
Lehman Brothers
Company typePublic company
IndustryInvestment services
PredecessorH. Lehman and Bro.
Montgomery, Alabama, U.S.[1]
FoundersHenry, Emanuel and Mayer Lehman
DefunctSeptember 15, 2008; 15 years ago (2008-09-15)
FateChapter 11 bankruptcy Liquidation
Headquarters745 Seventh Avenue, ,
Area served
Key people
Number of employees
26,200 (2008)
SubsidiariesLehman Brothers Inc., Neuberger Berman Inc., Aurora Loan Services, LLC, SIB Mortgage Corporation, Lehman Brothers Bank, FSB, Eagle Energy Partners, and the Crossroads Group

On September 15, 2008, Lehman Brothers filed for Chapter 11 bankruptcy protection following the exodus of most of its clients, drastic declines in its stock price, and the devaluation of assets by credit rating agencies. The collapse was largely due to Lehman's involvement in the subprime mortgage crisis and its exposure to less liquid assets.[6][7][8] Lehman's bankruptcy filing was the largest in US history,[9] and is thought to have played a major role in the unfolding of the financial crisis of 2007–2008. The market collapse also gave support to the "too big to fail" doctrine.[10]

After Lehman Brothers filed for bankruptcy, global markets immediately plummeted. The following day, major British bank Barclays announced its agreement to purchase, subject to regulatory approval, a significant and controlling interest in Lehman's North American investment-banking and trading divisions, along with its New York headquarters building.[11][12] On September 20, 2008, a revised version of that agreement was approved by U.S. Bankruptcy Court Judge James M. Peck.[13] The next week, Nomura Holdings announced that it would acquire Lehman Brothers' franchise in the Asia-Pacific region, including Japan, Hong Kong and Australia,[14] as well as Lehman Brothers' investment banking and equities businesses in Europe and the Middle East. The deal became effective on October 13, 2008.[15]

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