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Speculation of Lehman Brothers sale

While Lehman Brothers expects to lose nearly $3 billion in the second quarter, the bank says it's raising $6 billion in capital from elsewhere. Ashley Milne-Tyte reports it may be readying for a sale.

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Scott Jagow: Onto the banks now. Lehman Brothers said today it expects to lose nearly $3 billion in the second quarter. Ashley Milne-Tyte has more.


Ashley Milne-Tyte: It may be losing a few billion, but Lehman Brothers says it’s raising $6 billion in capital from various investors.

And that’s not all, says banking consultant Bert Ely. The firm is making efforts on multiple fronts.

Bert Ely: Increasing their liquidity, trimming the size of their balance sheet and also reducing their leverage. All of these are steps that are being taken to prevent Lehman from becoming another Bear Stearns.

Talking of Bear Stearns, some have speculated that Lehman may be readying itself for a sale. Benjamin Wallace of Grimes and Company says that could be the case.

Benjamin Wallace: Right now, their market cap’s about $18 billion. For a large financial institution, that’s not quite bite-sized but it’s definitely a doable deal.

He says there are a few large banks that would be interested in acquiring it. Still, he says, the fact that Lehman is actively raising billions in capital makes a buyout by one of its larger rivals less likely.

In New York, I’m Ashley Milne-Tyte for Marketplace.

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