Fed: Lehman Is Not Under Pressure To Boost Capital

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The New York Sun

Lehman Brothers Holdings Inc., whose stock has lost more than half its value this year, isn’t under pressure from the Federal Reserve and Securities and Exchange Commission to boost capital, a government official said. Regulators are leaving it up to Lehman for now to decide whether it needs to raise money, said the official, who declined to be identified because discussions between regulators and the firm are private. Lehman is unlikely to face the type of run that drove Bear Stearns Cos. near bankruptcy because the Fed is now lending money directly to brokerages, the person said. Lehman has raised $8 billion since February to offset losses from a global credit contraction that forced Bear Stearns to sell itself to JPMorgan Chase & Co. Lehman this month may post its first quarterly loss as a public company, analysts predict, stoking investor concern that it will have to seek more capital.


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