Lehman Brothers filed for bankruptcy on 15 September 2008, intensifying the global stock-market crash.
The American investment bank was heavily exposed to the collapsing U.S. housing market through mortgage-backed securities and other real-estate investments. As housing prices fell and mortgage defaults rose, confidence in Lehman’s finances deteriorated sharply.
Lehman filed for Chapter 11 bankruptcy protection in the United States with about $639 billion in assets, making it the largest U.S. bankruptcy filing at that time. The collapse caused severe stress in credit markets and accelerated the worldwide financial crisis.
Lehman’s failure is sometimes confused with Bear Stearns, which required a JPMorgan Chase rescue in March 2008, or Merrill Lynch, which agreed to be acquired by Bank of America in September 2008. Lehman’s bankruptcy was the pivotal event; the wider crisis also involved failing banks, falling share prices and government interventions across many countries.