Lehman Brothers goes bust

Grovelawn Financial News 15/09/2008

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Thousands will lose their jobs

Lehman Brothers the 158 year old bank has been forced into bankruptcy as the global credit crunch claimed another victim. The bank has said that its failure at the weekend to finally secure a rescue package has made it insolvent resulting in the possible loss of over 26,000 jobs, 5,000 of these are in Canary Wharf and High Wycombe.

Bank workers turned up today and where told their jobs had gone after traders working in other banks where told to go in to work at the weekend to assess their exposure to the collapsed lender.

The bank has said that its customers would be able to use their accounts normally and it would take steps to allow it to manage its operations as well as pay its staff.

The bank was said to have been very exposed to the US’s mortgage backed securities and it was due to this that the US Treasury refused to bank roll a rescue package and this factor prevented others from bailing out the stricken bank causing its inevitable collapse.

The bank ran out of any bail out options over the weekend and called in bankruptcy specialists saying “The board of directors… authorised the filing of the Chapter 11 petition in order to protect its assets and maximise value”

← Lenders announce rate cuts | News For September 2008 | HBOS up for sale →

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