Lehman Brothers Is No Bear Stearns
More in BUSINESS NEWS
back-up- 'Worse Than A Divorce - I've Lost Half My Money & I Still Have A Wife!'
- Top Firm Said Planning To Cut 3,000 Jobs
- Goldman Angry At Suggestion That It Should Merge
- Recruiters - Get More, Spend Less
- 'Rising Stars' - The Leading Nominations To Date
- 'What Short Memories We Recruiters Have'
- 'It Could Be Worse' - Recruiters Express Their View
- Another Bank Boss Forced Out
- UK Treasury Statement On Banking Industry 13/10/08
- The 2008 Best CTO / CIO Poll - Last Week
- Controversial Comment - The Media's At Fault Too
- 'I Am Bonus' - A Necessity For Naturally Indolent People
- It Could Be Worse - You Could Be In Recruitment
- Click Here To Register For Free News E-Mail Alerts
- The Best Firms For Graduate Recruitment & Development Are
- BofA, Lehman, Merrill, Morgan Stanley, UBS, Hank Paulson, AIG
- Funny Caption Competition
- Wachovia Staff Memo On Confirmation Of Wells Fargo Deal
- Credit Suisse, RBS, SocGen, Dexia, Kaupthing
- Global Debt & Equity League Tables - Year To Date
- Featured Recruiter - Martin Ward Anderson
- 'There Was Nothing Special About Our Firm' - Letter From A Lehman Staffer
- Firm Said To Be Cutting 20% Of Investment Banking Staff
- Pandit Does His 'Nut'
- Roll Up For A Session Of 'Bailout Bingo'
- 'On Top Of Everything Else, Now I'll Get No Severance'
- UK Treasury Statement On Bank Financial Support Plan
- Layoffs - The Definitive Job Loss League Table (The Very Latest)
- 'Their Staff...Were Making A Lot More (Than Ours). That Won't Last'
- The So-Called 'Greedy' Lehman Bonus E-Mail
- CenterFuld - Lehman Boss In The Dock
- M&A - Top Dogs Around The World
- An Oldie, But Goodie During These Difficult Times
- Richard Fuld's Statement To The Congressional Committee (In Full)
- Citi Sues Over Wachovia - For $60bn!
- Fear Not, There Are Jobs Out There
- If Your Firm Was A Monopoly Property.....
- 'Never Mind Your Bonus' - The First Here Is The City Book
- Top Firm Accused Of Bringing Down Lehman
- Top Boss Says Bonuses Will Be 'Solid', But 'Smaller'
- Hedge Fund Makes Single $2.5bn Winning Trade
- 'This Was As Cogent A Case Of Murder As Might Be Imagined'
- 'This Hodge-Podge Of Regulations...(Will) Put Many (Banks) Off Participating'
- Wacha-Gotcha-Notcha-ovia - Bun Fight For Wachovia
- Top Worldwide M&A Legal Advisors - Year To Date
- Citigroup Threatens Legal Action Over Wachovia (Citi Statement)
- Wells Fargo Press Release On The Wachovia 'Acquisition'
- Out Of A Job, Out Of Pocket & Out For Blood
- 'In The Land Of The Laid-Off, The Hiring Firm Is King'
- UBS Confirms 2,000 Job Losses / Closure Of Commodities Unit
Related Content
- Bear Stearns Lives On (01/08/2008)
- New Book Said To Blame Top Firm For Fall Of Bear Stearns (03/08/2008)
- What Next For Lehman Brothers ? (14/09/2008)
- Lehman Brothers - A Brief History (31/08/2008)
- Lehman Brothers - Press Release (10/09/2008)
- Richard Bove's Recent Note On Lehman Brothers (22/08/2008)
But, even before the Bear drama had played itself out, market-watchers were wondering if other firms are likely to find themselves in similar trouble. Although Bear's shares fell 47% Friday, Lehman Brothers shares closed 15% down, with falls also at Citi (6.1%) and Bank of America (3.9%).
Lehman is the firm viewed to be the most like Bear, and that explains why the firm's shares took a dive Friday, but it is unlikely to suffer in the same way as its rival. Bloomberg quotes Douglas Ciocca from Renaissance Financial Corp., who said that 'the firms are very different....probably more than anything in how they manage risk. Lehman had very limited exposure to the sort of things that have brought the downfall of Bear Stearns...To me, Lehman's trading at book value. These are trough valuations for a company that should continue to have a very strong franchise, because they have reasonably diversified streams of revenue'.
Adding to the argument that Lehman will not go the same way as Bear is the determined manner in which the US Federal Reserve moved to help JPMorgan complete the Bear deal in record time - just over two days. The Feb showed that it will do all that is required to prevent a meltdown of the banking system, and the confidence that this will inspire is likely to stop any run on essentially strong firms like Lehman Brothers. It's now time to stop the panic, and start being rational.
