Lehman's debt insurers face $360bn bill$

The insurers of Lehman Brothers’ debt face a claims bill of about $360 billion (£211 billion) after an auction of the bankrupt US brokerage’s borrowings determined that they were only worth 9.75 cents on the dollar. Lehman’s bankruptcy filing last month sent its bond values plunging as most of the investment banking assets that supported the debt were purchased by Barclays, leaving debt holders at the abandoned holding company with little to reclaim. About 350 banks and investors are thought to have insured an estimated $400 billion of Lehman’s debt through complex derivatives, known as credit default swaps (CDS). These include Pacific Investment Management, the manager of the world’s largest bond fund,... [read full story]