Lehman Brothers was the investment bank whose 2008 bankruptcy became a central shock of the global financial crisis.
Lehman Brothers filed for Chapter 11 bankruptcy protection on September 15, 2008. With about $639 billion in assets, it was the largest bankruptcy filing in U.S. history at that time. The firm had been heavily exposed to mortgage-related assets and struggled as the U.S. housing market deteriorated.
The filing intensified fear about counterparty risk and the solvency of other financial institutions. Money-market funds, credit markets, banks, and stock exchanges were affected. The collapse followed the government-supported rescue of Bear Stearns in March 2008 and preceded the emergency rescue of insurer AIG.
Lehman’s bankruptcy did not begin the entire crisis; stress had been building for more than a year. It became a defining event because its disorderly failure revealed how interconnected global finance had become.