Which U.S. investment bank collapsed during the 2008 financial crisis?

Lehman Brothers collapsed during the 2008 financial crisis after filing for bankruptcy on September 15, 2008.

With approximately $639 billion in assets, Lehman’s bankruptcy was the largest in U.S. history at that time. The firm had accumulated major exposure to mortgages and mortgage-related securities. As housing prices fell and defaults increased, investors and counterparties lost confidence in Lehman’s balance sheet and its ability to raise funding.

The failure intensified an already severe credit crisis. Money-market funds, banks, and businesses faced rising uncertainty about who might survive and who might be able to pay. The U.S. government had helped facilitate JPMorgan Chase’s purchase of Bear Stearns earlier in 2008, but no rescue was arranged for Lehman Brothers.

Lehman’s collapse is often described as the event that transformed a serious financial problem into a worldwide panic. It was not itself a stock-market index, but its bankruptcy became one of the defining moments of the 2008 market crash.