What was the largest company bankruptcy in U.S. history when Lehman Brothers failed in 2008?

Lehman Brothers was the largest U.S. company bankruptcy when it failed in 2008.

The investment bank filed for Chapter 11 bankruptcy protection on September 15, 2008, reporting more than $600 billion in debt. Its collapse became a defining moment of the global financial crisis and intensified a stock-market sell-off that had already been underway.

Lehman had built a large business around mortgages and mortgage-related securities. As U.S. housing prices fell and defaults rose, the value of those assets became increasingly uncertain. Attempts to find a buyer failed, and the firm’s bankruptcy damaged confidence in financial institutions worldwide.

Lehman’s failure is not identical to the stock-market crash itself. It was a corporate bankruptcy that helped accelerate the 2008 financial crisis and market collapse. The crisis also involved other institutions, including Bear Stearns, AIG, and Washington Mutual, each with a different failure or rescue story.