Which company’s bankruptcy became a defining event of the 2008 financial crisis?

Lehman Brothers’ bankruptcy became a defining event of the 2008 financial crisis.

Lehman Brothers filed for Chapter 11 bankruptcy on September 15, 2008. At the time, it was the largest bankruptcy filing in United States history. The firm had accumulated large exposures to mortgage-related assets and became unable to maintain confidence among lenders and counterparties.

The failure intensified a crisis that had already spread through housing finance, banks, and credit markets. Interbank lending tightened, investors sold risky assets, and governments around the world introduced emergency guarantees, capital injections, and stimulus measures.

Lehman’s collapse is sometimes described as the beginning of the entire crisis, but the trouble started earlier. Bear Stearns required a rescue in March 2008, and the U.S. housing and subprime mortgage problems had been developing for years.