Which investment bank’s bankruptcy marked a defining moment of the 2008 financial crash?

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

The investment bank filed for Chapter 11 bankruptcy protection on September 15, 2008. With roughly $639 billion in assets, it became the largest bankruptcy filing in United States history at that time. The failure intensified fear about the solvency of banks and the risks embedded in mortgage-related securities.

Lehman had expanded heavily into real-estate finance before the crash. As U.S. house prices fell and subprime mortgage defaults rose, the value of many mortgage-linked assets became uncertain. Credit markets tightened sharply, making it difficult for institutions to obtain short-term funding.

Other major firms followed different paths. Bear Stearns was rescued in March 2008, while Merrill Lynch agreed to be acquired by Bank of America in September. Lehman’s failure helped trigger extraordinary government and central-bank interventions, including the U.S. Troubled Asset Relief Program.