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Britain's third-largest bank had appeared to be the frontrunner to take over Lehman Brothers but has pulled out of the bidding, according a Barclays source close to the deal.
The person, who spoke on condition of anonymity, said the decsion was "very unlikely" to change because Lehman did not meet Barclays' "stringent requirements".
US government officials and top Wall Street bankers are desperately trying to sell Lehman and avert a collapse that could severely disrupt global markets.
Preparations have been made for Lehman Brothers, the substantial US investment bank, to obtain protection from its creditors under US Chapter 11 insolvency procedures.
I have also learned that PWC, the leading accountancy firm, has been lined up to run the UK operations of Lehman in the event that it is put into administration under our insolvency arrangements.
Originally posted by loam
This is freaking unbelievable!
What a mess!
What's with the special trading? I didn't know they could do that. Is that for institutional investors only? What about the individual guys?
Originally posted by yellowcard
I think we should let it collapse, we should have let Bear Stearns collapse...Fannie and Freddie kind of a different story, since they hold SO many U.S. home mortgages...but imo we should have split them into different companies so that if one sector fails it doesn't disrupt the mortgage market as severely, as it stands they have a monopoly on mortgages. The crash of 1987 was the bottom of the stock market...may as well just rip the bandaid.
[edit on 14-9-2008 by yellowcard]
Everyone is trying to figure out, with their teams of lawyers and accountants, what it would mean if Lehman goes down and files for bankruptcy protection. Few of the market makers have counted on that happening, at least not in this -early- stage of the Unwind game.
They are supposed to work together to find a solution, but while they talk their thoughts wander inexorably towards the survival of their own firms and jobs and shares and homes and yachts and lifestyles and choir boys and mistresses and reputations. Not an ideal environment to do big business in.
Nobody really wants Lehman. An early proposal to split off a "bad bank" branch containing $85 billion in "souring" assets, including $30 billion in commercial real estate silly paper, had the effect of a category 12 hurricane warning: women and children first.
They all know that if that's what's known, there's more to come: they only need to look at their own -hidden- books. That's exactly why they refuse to lend to each other, after all.
Originally posted by infinite
The Fed may bail them out and it could happen in the next two hours (that's the deadline.) But I seriously cannot see it.
Bank of America and a coalition of partners have pulled out now as well.