Lehman tree not very pretty, fruit impossible to eat

Courtesy of FT Alphaville, we have these pictures of devastation from Hurricane Yikes!

Lehman’s unsecured creditors — Japanese banks back in post-bubble nightmare?

Japan’s Financial Services Agency on Monday ordered Lehman Brothers’ Japanese subsidiary to retain assets in the country as it emerged that Japanese banks were the US group’s top unsecured lenders. Lehman’s Chapter 11 filing for bankruptcy protection reveals that Japan’s Aozora Bank - controlled by US private equity group Cerberus - is owed $463m in unsecured bank loans, more so than any other bank, while Mizuho is in second place with $289m owed

Other Japanese banks named in the Lehman filing included Mizuho witih $382m in exposure, Shinsei Bank with $231m, UFJ Bank with $185m, Sumitomo Mitsui Banking Corp with $177m and Chuo Mitsui Trust & Banking with $93m in loans.

“A 21-year-old Lehman graduate trainee in London, who declined to be identified by name, said he and 90 to 95 colleagues had been called in by the human resources department and made redundant. They had started work a week ago.” (Linked to this Bloomberg story.)

Lehman - clock these counterparty risk numbers…

Deutsche had or has €1.14 trillion of counterparty exposure with Lehman. We guess the number includes the notional value of derivatives, but still…

Lehman’s bonus clawback

Do you work at Lehman? Did you hear Christian Meissner (LEH’s co-head of investment banking in EMEA) tell you in a London meeting this morning that you were on your own and shouldn’t expect to be paid?

Because he did, apparently.

The bad news doesn’t stop there either, Lehman employees. You may owe your former employer money. So much for limited liability.

From Alphaville's FlagShip, there's this:

Lehman’s outstanding debts total $600bn

Lehman Brothers Holdings owes more than $600bn to creditors scattered across the US, Europe and Asia, according to the investment bank’s Chapter 11 petition.

The largest unsecured creditors include Citigroup and Bank of New York Mellon, who have around $138bn of exposure to Lehman’s bond debt as indenture trustees.

Apart from the trustees, Japan’s Aozora Bank, which is part owned by Cerberus, is owed $463m. The top European creditor is BNP Paribas, which according to the filing extended a $250m bank loan to the investment bank.

The largest unsecured creditors include Citigroup and Bank of New York Mellon, who have around $138bn of exposure to Lehman’s bond debt as indenture trustees.

But is that just a bit of headline hyperbole?

Indenture trustees act as agents on behalf of bondholders, and while they help enforce the rights of creditors, they are not necessarily creditors themselves.

”Whatever may appear in a filing by Lehman in terms of gross exposure will be very different from what we have net of our hedges and net of our collateral,” Richard Layton, Aozora’s chief financial officer, told Reuters in a telephone interview on Monday.