sbdcsierra Chapter 549 Three Days Before Lehman Went Bankrupt
Chapter 549 Three Days Before Lehman Went Bankrupt
The time comes in September.
North American financial markets are undercurrent.
A suffocating storm is brewing on Wall Street.
September 11th.
Lin Qingya came to Lu Yi's office with a solemn expression.
Lu Yi asked: "You look so ugly, what's wrong?"
Lin Qingya said: "There is something wrong with Wall Street in North America. Lehman Brothers, one of the five largest investment banks in North America, is likely to declare bankruptcy in the near future!"
Lu Yi raised his eyebrows when he heard this, and a look of surprise flashed in his eyes.
If he remembered correctly, the time when Lehman Brothers declared bankruptcy in his previous life was ~1 o'clock in the morning on September 15th.
It is September 11th, and there are four days left before Lehman Brothers declares bankruptcy.
He didn't expect that Lin Qingya's sense of smell was so sharp that she could smell the imminent bankruptcy of Lehman Brothers.
"How do you say it?" Lu Yi said.
Lin Qingya said: "Lehman Brothers' liabilities are too high, exceeding 600 billion meters of gold. If there is no external financial support, once this thunder explodes, the already bad global economy will become even worse, or even worse." Complete collapse!"
“However, Lehman Brothers’ efforts to obtain external funding also failed.
"On September 9, Hankuk Industrial Bank (KB) announced the termination of negotiations to acquire Lehman Brothers, which directly caused Lehman's stock price to fall by 45%.
"In the financial report released yesterday, Lehman Brothers lost approximately 3.9 billion gold in the third quarter, which was the heaviest loss suffered in a single quarter in the 158 years since its establishment. The stock price also fell by 7%, closing at 7.79 gold. , the stock price has fallen by 95% from its peak of over 60 million yuan at the beginning of 2007, leaving the entire company with a market value of only 6 billion yuan."
"Now, it depends on whether Barclays, the Eagle Country that is interested in Lehman Brothers, will help Lehman Brothers at this time."
"If Barclays Bank also terminates its acquisition negotiations for Lehman Brothers, and if the North American government fails to help, then Lehman Brothers will have no choice but to go bankrupt!"
Lu Yi nodded: "You are right! Among the five major investment banks in North America, who holds the largest number of mortgage-backed securities is none other than Lehman Brothers. In addition, Lehman's own capital is too small and the leverage ratio is too high, so There are too many non-performing assets held. Once this thunder explodes, it will completely trigger a global financial tsunami."
Lin Qingya sighed: "The fate of Lehman Brothers depends on the decisions of Barclays and Bank of America.
Lu Yi said: "Let's wait and see."
at the same time.
The eyes of the whole world are also fixed on Wall Street.
Friday, September 12, 2008.
Lane Smith is executive manager for commercial real estate at Lehman Brothers.
When he arrived at the company at 9:30 in the morning, he was still smiling and making jokes with the young and beautiful female secretary.
As the company's fastest-rising executive manager, he has the qualifications to be high-spirited.
Although a year ago, a subprime debt bomb dragged North American real estate and Wall Street into the abyss.
And in March this year, after Bear Stearns was acquired by JPMorgan Chase, Lehman, which had invested most of its investment in commercial real estate, saw its stock price continue to fall.
In order to clear the mines, Lehman formed a secret team to split and package these assets into a new company.
We have already thought of a company name, and we decided to call it REI-GLOBAL.
Ryan Smith, who often serves commercial real estate clients, was recommended by Mark Walsh to CEO Richard Fuld. He was promoted from an ordinary business manager to the executive manager of the investment banking department of the new company, overseeing an investment team of 110 people.
A big stage is waiting for him to flex his muscles and shine.
At 10:08, the phone on the table rang.
Lane Smith answered the phone.
"Hi, boss, I'm Renn."
"Ryan, unfortunately I have to tell you some bad news. The plan to spin off the company may not be supported by the Korean and Japanese banking groups.
On the other end of the phone came the voice of big boss Richard Fuld.
These words made Rainn Smith, who was still flirting with the female secretary, quickly become clouded.
This is indeed bad news for him!
"However, Ren, there is good news. I have just convinced Treasury Secretary Paulson that tonight he will come forward to bring the big guys from Wall Street investment banks together to discuss the capital injection of Lehman.
After hearing this, Ryan Smith's face became better.
Immediately afterwards, he heard the order given to him by the big boss, asking him to arrange the reception quickly.
"Ren, you have to know that this may be our last chance, so you must do it well."
Ryan Smith promised: "Boss, don't worry, I will hold a cocktail party that will satisfy everyone."
After hanging up the phone, Ryan Smith immediately took action.
As the big boss said on the phone, tonight may indeed be their last chance, and there is no room for failure.
At 8 p.m., the grand ballroom of the Four Seasons Hotel in downtown New York was brightly lit.
CEO Richard Fuld took Lane to greet distinguished guests at the door.
0...Please give me flowers‥
The heads of major investment banks such as Goldman Sachs, Bank of America, Morgan Stanley, and UBS are all well-dressed. Together with Treasury Secretary Paulson and Federal Reserve Chief Bernanke, all the big names who can influence Wall Street are all absent.
After the reception begins.
Richard Fuld took Lane to chat with the big guys. It seemed like they were chatting and laughing, but in fact it was like bargaining in the free market.
"As long as we provide funds, we'll talk about it, Tian Sakako."
"Afraid of default? If there is any problem with the first 5 billion meters of gold, we, Lehman, will repay it."
"Do you think it's expensive? Well, let's give 20% off..."
After getting a bunch of specious promises from the heads of major investment banks, Richard Fuld took Lane to the front of Treasury Secretary Paulson and Federal Reserve Chief Bernanke.
"We only need one condition, or the federal capital injection, or the Federal Reserve's commitment to our commercial mortgage bonds, allowing us time to deal with the related assets." Richard Fuld looked into Paulson's eyes and said one word Said one sentence at a time.
........0...
If the federal government does not inject capital, Lehman Brothers' lifeline lies with Barclays.
The prerequisite for Barclays' acquisition of Lehman Brothers is that the North American government must give a guarantee commitment to offset Lehman's "open-ended" transaction debt.
"As Presidential Plenipotentiary, I will not use taxpayer money to bail out Lehman."
Paulson's words made Richard Fuld's expression change drastically.
"Although I can't use taxpayers' money to save Lehman, they can." Paulson pointed at the Wall Street bosses in the venue, "No one can leave today [but give me an attitude."
These words made Richard Fuld, whose expression changed drastically, look much better.
As long as the government still cares about them, then Lehman can still be saved!
soon.
The well-fed bosses walked into a business conference room.
They all know the purpose of Paulson's meeting here today, which is to save Lehman Brothers, which is on the verge of bankruptcy, but no one has expressed their position now.
They are all waiting for the report issued by the asset accounting team in the next door conference room.
And Ryan Smith, under the instructions of the big boss, led a team to work with the joint working group of Goldman Sachs and Credit Suisse designated by Treasury Secretary Paulson to calculate the value of the new company.
Next, Renne spent the most difficult hours of his career.
As the accountants and lawyers in the accounting team began to review the assets item by item, and "tortured" him severely, they asked each of them merciless questions that made him break into a cold sweat and he didn't know how to answer B. .