Which company’s bankruptcy became a defining moment of the 2008 global financial crash?

Lehman Brothers’ bankruptcy became a defining moment of the 2008 global financial crash.

The investment bank filed for Chapter 11 bankruptcy protection on September 15, 2008. At the time, it was the largest bankruptcy filing in U.S. history. Lehman had accumulated major exposure to mortgage-related assets, including securities connected to the collapsing U.S. housing market.

Its failure intensified already severe problems in credit markets. Banks and investors became more uncertain about which institutions were financially sound, causing lending to freeze and market volatility to surge. The crisis had begun earlier, including the collapse of the subprime mortgage market and the rescue of Bear Stearns, but Lehman’s failure became a powerful symbol of systemic danger.

Lehman was not the only major institution affected. Merrill Lynch was acquired by Bank of America, while the U.S. government rescued insurer AIG. The financial shock contributed to a deep recession in many countries and led to extensive regulatory reforms.