Which investment company’s failure intensified the 2008 global stock-market crash?

Lehman Brothers’ failure intensified the 2008 global stock-market crash.

The investment bank filed for bankruptcy on September 15, 2008, after suffering enormous losses connected to the U.S. housing market and mortgage-related securities. Its collapse became a defining moment in the global financial crisis because Lehman was deeply connected to banks, funds, and counterparties around the world.

The crisis had developed earlier through falling U.S. house prices, rising mortgage defaults, losses on mortgage-backed securities, and stress in short-term credit markets. Lehman’s bankruptcy sharply increased fear that other financial institutions might also fail, leading to severe selling in stock markets and disruption in credit markets.

Lehman was not the only major institution in trouble. Bear Stearns was rescued in March 2008, while Merrill Lynch was acquired by Bank of America. The U.S. government also placed Fannie Mae and Freddie Mac into conservatorship. Lehman’s bankruptcy remains the largest in U.S. history by assets at the time of filing.