Lehman wind-up leaves Enron pale by comparison

PricewaterhouseCoopers (PwC) administrators last week said that the
Lehman Brothers job was ’10
times as big and as complicated as the unwinding of Enron’ and warned some
creditors would lose money.

At a meeting of creditors behind closed doors at the O2 dome in London, Tony
Lomas, the lead administrator, said he was in the process of recovering about
$5bn (£3.38bn) out of a potential $550bn (£376bn)of obligations owing to
creditors. Another $22.3bn (£15.1bn) of client assets had been identified, all
of which will be returned to their owners, the Guardian reports.

Lomas said the administration was already behind schedule because of delays
in receiving confirmation from third parties believed to be holding assets of
Lehman Brothers International (Europe). PwC has so far identified more than 400
trade creditors to Lehman’s European business, including Ernst & Young,
HSBC, BT, the London Stock Exchange and Lufthansa.

Even PWC itself, the Bank of England and the Financial Services Authority are
owed money. ‘The balance sheet position will be north of $1tn (£0,6697tn) and
we’ve got a long way to go before knowing what the position is for creditors,’
Lomas said after the meeting.

Further reading:

Lehman Bros administration costing £4m a week

the Guardian story

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