Lehman Brothers Bond Holders Likely To Forfeit Billions
The historic bankruptcy filing of Lehman Brothers is likely to have repercussions for months, even years to come. And no one knows this better than investors who own Lehman Brothers bonds. In just the short time since the nation’s fourth-largest investment firm filed for bankruptcy protection, the value of its bonds has plummeted, with some analysts predicting bondholders may be facing losses of $110 billion when all is said and done.
Lehman’s bankruptcy filing means its assets will be sold, with the proceeds distributed to lenders and bondholders. Anything left over then goes to preferred shareholders, followed by common stock shareholders.
Things are not looking good for Lehman bondholders, however. As reported Sept. 22 in the Financial Times, Lehman bonds were prevalent among pension funds and mutual funds. That means any losses will have a significant impact on untold numbers of ordinary individuals.
Making matters even worse for bond investors is the potential of additional losses on Lehman’s derivatives positions, which are still being unwound.
Typically, when a company declares bankruptcy, senior debt holders usually are first in line to collect their claims. Prior to its bankruptcy filing, Lehman had $110 billion of unsecured senior bonds that were valued at approximately 95 cents on the dollar. Now they are trading at about 20 cents to the dollar.
Subordinated notes, which are among the last to paid and of which Lehman holds more than $17 billion worth - were trading for as little as 3.5 cents on the dollar.
Lehman Brothers was forced into bankruptcy on Sept. 15, following massive losses on mortgage-backed securities and insufficient capital reserves. In total, the company lost 94% of its market value in 2008. At the time of its bankruptcy, Lehman listed $631 billion of debt, including $110.69 billion in unsecured debt and $17.6 billion in unsecured, subordinated obligations.
Our affiliation of securities lawyers is actively involved in advising individual and institutional investors in evaluating their legal options when confronted with subprime and other mortgage-related investment losses.
October 5th, 2008 at 9:15 pm
I own $65,000.00 in LEHMAN BROS HLDGS 4.5%10NOTES DUE 07/26/10 in my IRA account.
How can you be of help to me to recover my loss?
Peter
October 14th, 2008 at 2:48 am
I’d like to have informations on Lehman preferred I bought at the local branch of Deutsche Bank in Barcelona (Spain) by marc 2006.
November 14th, 2008 at 1:30 pm
I own $30K of Georgia Main Street Gas bonds backed by Lehman now trading for 16 cents on the dollar. Lehman’s default spreads wide and class action suits should also include more than just stock holders.
December 3rd, 2008 at 8:10 am
I own 20,000 worth of lehman bonds. How can I recover any payout?
December 3rd, 2008 at 4:45 pm
i purchased main st. gas bonds from F.M.S. bonds in boca raton. i was not told that lehman bros. was holding the money, didbt recieve a prospectus,and was never told this muni bond was a commidity. if i had this info.i would not have purchased this bond. please help
richard
January 6th, 2009 at 11:25 am
I purchased ga. mainstreet gas bonds from F.M.S. bonds in boca raton. I was told they were very safe. I was also told they were AA- muni bonds. I purchased $100,000.00 worth of these bonds. I was never told that Lehman Bros. was the primary issuer of these bonds and I never received a prospectus on the bonds.I would not have purchased had I know Lehman had anything to do with them. Do I have any recourse against F.M.S. or the broker who highly recommended them?
March 19th, 2009 at 6:10 pm
I lost $102K in Lehman Brothers Bonds after being told by my Edward Jones Broker not to sale when news of their possible bankruptcy hit the news. His advise was based on his company;s recommendations on this matter. Lehman went bankrupt the following weekend. I have a tape recoding of my conversation with the broker. Do I have any recourse aainst Edward Jones or Lehman?
March 21st, 2009 at 12:06 pm
I purchased
main street natural as bonds Series 2008A from Etrade . The bonds were classifed under the Etrade online listing of Municipal Bonds in Etrade inventory and were rated AA- muni bonds. I purchased $20,000 worth of these bonds at 100. Nowhere was there disclosure that Lehman Bros. was the primary obligor of these bonds and I never received a prospectus on the bonds.I would not have purchased had I know Lehman was the sole creditor and they were in fact not backed by any municipality.
Do I have any recourse against Etrade.?
April 11th, 2009 at 12:59 pm
I purchased $30,000 of Main Street Natural Gas at par from The GMS,Group believing it was a municipal bond, and was never told that this bond in fact was not backed by any municipality. Do I have any recourse against The GMS Group ?
April 22nd, 2009 at 3:35 pm
My broker, Edward Jones invested $45K in Lehman Bonds. Prior to the bankrupcy filing it was worth $31,000+. I talked to the broker twiced and said I think I should sell. He said you will get more back by not selling. He insisted he was having conversations with “bonds people and his headquarters”. Now they are worth less than $1K.
The assistant attorney general in my state thinks I have a case. Edward Jones just responds with a vague letters.
September 7th, 2009 at 12:49 pm
i filed with “finra” for an arbritration hearing against gms for the same reason.