Tuesday, September 8, 2009
It’s the rehypothecation clauses, stupid.
Clients of Lehman Brothersâ€™ UK business are still waiting for the return of $17 billion (Â£10.4 billion) of assets almost a year after the collapse of the investment bank. $639 billion of assets are wrapped up in a catâ€™s cradle of trades and investments across a vast array of jurisdictions, subsidiaries and clients. The bankruptcy exposed ignorance among supposedly sophisticated financial institutions about the status of their assets held by Lehmanâ€™s UK business.