Wednesday, August 22, 2007
Lehman Brothers kisses bye-bye to their subprime business
Well, that's more that 4% of their workforce gone. Still, it's 4% fewer people clamouring for bonuses at Xmas time "Lehman Brothers, a leader in packaging subprime mortgages into securities, is shutting down one of its home lending units and laying off 1,200 employees. The bank said it would take a $52 million hit to third-quarter earnings. “Lehman Brothers announced today that market conditions have necessitated a substantial reduction in its resources and capacity in the subprime space,” the firm said in a news release. Lehman’s decision to shutter the lending unit, BNC Mortgage, makes it the latest casualty in the subprime mortgage meltdown that started earlier this year and rippled into the broader credit markets starting in late July. "