What was the 2008 collapse of Lehman Brothers that intensified the global stock-market crash?

The 2008 collapse of Lehman Brothers that intensified the global stock-market crash was the Lehman Brothers bankruptcy.

Lehman Brothers filed for Chapter 11 bankruptcy protection on September 15, 2008. The investment bank had accumulated extensive exposure to U.S. mortgages and related securities, while the housing downturn reduced the value of those assets. Lehman could not secure a buyer or sufficient government-backed rescue, and its failure shocked financial institutions worldwide.

The bankruptcy increased fears about counterparty risk and the safety of other banks. Credit markets froze or became extremely expensive, and stock markets fell sharply in the United States and abroad. The failure was one of the defining moments of the 2007–2008 global financial crisis, although it was not the crisis’s original starting point.

Lehman is sometimes confused with Bear Stearns, which was rescued through a sale to JPMorgan Chase in March 2008. Lehman’s bankruptcy was different because no comparable acquisition prevented its formal collapse.