Yes, according to CNBC, Lehman has confirmed that it will file for Bankruptcy!
- CNBC has confirmed press reports that Lehman Brothers is likely to file for bankruptcy protection as soon as Sunday evening.
Among details to be worked out: the accounting treatment for certain derivatives and repurchase positions, an area not currently covered by bankruptcy laws; and the orderly netting out of a variety of securities positions to which Lehman Brothers is contractually obligated.
Federal authorities are expected to be involved in the orderly disposition of Lehman assets if such a filing occurs. Sources knowledgeable about the weekend deliberations tell CNBC that without some government participation in the process, a bankruptcy filing by Lehman Brothers would cause major disruptions in the financial system.
Officials at the Federal Reserve and U.S. Treasury are taking steps to mitigate risk to the system and assure the orderly functioning of the markets tomorrow.
According to the New York Times, Lehman will seek to place its parent company, Lehman Brothers Holdings, into bankruptcy protection, while its subsidiaries will remain solvent while the firm liquidates its holdings.
A consortium of banks will provide a financial backstop to help provide an orderly winding down of the 158-year-old investment bank. And the Federal Reserve has agreed to accept lower-quality assets in return for loans from the government, the New York Times says.
It is not clear whether the government would appoint a trustee to supervise Lehman’s liquidation, or how big the financial backstop would be.
Lehman's fate seem sealed after Barclays walked away from a deal to purchase the troubled Wall Street investment bank — brokers Sunday afternoon were streaming into their offices and a special trading session for credit default swaps was called.
Source: http://www.cnbc.com/id/26708143
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4 comments:
Darn it, who's next? Things are getting out of hand. It's pretty scary :(
NEWS:
AIG wants the FED to cough up 40B and their market cap is less than that.
MER is bought out by BoA for 50B or roughly 70% more than their last price.
This is only the end of the beginning.
LEH is the first financial that is Too Big To Bail (TBTB).
Wonder what the excuse is now for all the analyst who have called a bottom.
There shall be massive inflation before this is over.
Am seeing data that says this will last into 2011-12. Wonder who is calling the bottom for 2009.
I see commodities continuing their uptrend soon, fundamentals will prove this.
Just my 2 cents.
Er.. this is after all a financial crisis, yes?
And what can one expect from a financial crisei?
rgds
And what can one expect from a financial crisei?
>> opportunity?
>> perhaps?
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