Govt, Wall Street races to try to save Lehman

Govt, Wall Street races to try to save Lehman
AP
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First Published: Sun, Sep 14 2008. 02 24 PM IST
Updated: Sun, Sep 14 2008. 02 24 PM IST
Washington: The financial world held its collective breath on Saturday as the US government scrambled to help devise a rescue for Lehman Brothers and restore confidence in Wall Street and the American banking system.
Deliberations resumed Saturday as top officials and executives from government and Wall Street tried to find a buyer or financing for the No. 4 US investment bank and to stop the crisis of confidence spreading to other US banks, brokerages, insurance companies and thrifts.
Failure could prompt skittish investors to unload shares of financial companies, a contagion that might affect stock markets at home and abroad when they reopen Monday.
Options include selling Lehman outright or unloading it piecemeal. A sale could be helped along if major financial firms would join forces to inject new money into Lehman. Government officials are opposed to using any taxpayer money to help Lehman.
An official from the Federal Reserve Bank of New York said Saturday’s participants included Treasury Secretary Henry Paulson, Timothy Geithner, president of the Federal Reserve Bank of New York, and Securities and Exchange Commission Chairman Christopher Cox. The New York Fed official asked not to be named due to the sensitivity of the talks.
Citigroup Inc.’s Vikram Pandit, JPMorgan Chase & Co.’s Jamie Dimon, Morgan Stanley’s John Mack, Goldman Sachs Group Inc.’s Lloyd Blankfein, and Merrill Lynch & Co.’s John Thain were among the chief executives at the meeting.
They discussed the current financial crisis, and were asked to come back Saturday with solutions that did not involve any financial intervention by the government, the officials said. They spoke on condition of anonymity because the talks were ongoing.
Potential buyers could include Bank of America Corp., Britain’s Barclay’s Plc, Japan’s Nomura Securities, France’s BNP Paribas and Deutsche Bank AG. All have declined to comment.
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First Published: Sun, Sep 14 2008. 02 24 PM IST