🠈 Lehman Brothers 🠊
Lehman Brothers was a New York based financial firm that failed during the financial crisis due to its extensive investments in subprime mortgages.
The company started as a dry goods store in Alabama that moved into commodities because it accepted payment in cotton. The Lehman family had exited the firm by the 1970s and the bank transitioned through a number of mergers. It became a prime subprime lender during the housing bubble in the 1990s. The Feds decided to let the firm collapse.
I drew the outline for this section from Wikipedia. I will insert additional transactions that list Lehman as the principal catalyst or owner of the transaction.
- 1844: Henry Lehman immigrated from Bavaria and opened a dry goods store in Montgomery, Al called H. Lehman.
- 1847-1850: Emanuel and Mayer in 1850 followed suit and the store became Lehman Brothers.
- The company accepted cotton for payment and began trading in commodities as a result.
- 1854: Lehman Brothers bought a slave named Martha. They may have had more.
- 1858: Emanuel Lehman set up shop to trade cotton at 119 Liberty Street in NYC.
- The company became Lehman, Durr & Co during the Civil War.
- 1970: Lehman helped with reconstruction of Alabama and helped establish the New York Cotton Exchange.
- The company joined the Coffee Exchange and NYSE where it began underwriting IPOs, often in conjunction with Goldman Sachs.
- 1969: Robert Lehman, the last of the Lehman patriarchy, passed away.
- 1973: Pete Peterson from Bell & Howell took over.
- 1975: Lehman acquired Abraham & Co..
- 1977: Lehman merged with Kuhn, Loeb & Co. to become Lehman Brothers, Kuhn, Loeb Inc..
- 1984: Shearson/American Express acquired Lehman for $360 million to become Shearson Lehman/American Express.
- 1988: The company merged with E.F. Hutton & Co. to become Shearson Lehman Hutton Inc..
- 1994: An insurance company called Primerica bought the retail brokerage assets of American Express and spun off Lehman Brothers Holdings, Inc. in an IPO.
- 1997: Lehman created L3 Communication Holdings to facilitate a spin off from Lockheed Martin.
- 2001: The company's offices in the World Trade Center were destroyed on 9/11. The firm lost only one employee.
- 2001: Lehman purchased a 32-story at 745 Seventh Avenue for $700 million.
- 1997: Lehman acquired Aurora Loan Services of Colorado which was an Alt-A lender engaged in subprime mortgages.
- 2000: Lehman acquired BNC Mortgage LLC which sold subprime mortgages on the West Coast.
- 2003: Declining travel after 9/11 forced Le Méridien into bankruptcy. Lehman acquires the chain as lead debtor
- 2005: Starwood Hotels acquired the chain.
- 2008: BNC and Aurora had been making over $50 billions in loans per month and the portfolio of subprime loans ballooned to over $680 billion.
The hedges Lehman had taken against its subprime loans failed and the company collapsed.
- Wikipedia - Lehman Brothers (Drawn 11/14/2019)
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