Smaller recovery for securities lending losses says Lehman
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Smaller recovery for securities lending losses says Lehman 12 September 2011New York Reporter: Anna Reitman
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In a court filing last week Lehman said it decided that claims against the Lehman parent arising from guarantees of subsidiaries’ securities lending agreements do not qualify as Class five senior debt under the Chapter 11 plan, according to Bloomberg Business Week (BW).
Unless the bankruptcy judge in confirming the plan overrules Lehman’s opinion about the status of securities lending guarantee claims, holders of the claims will have a smaller recovery because they won’t benefit from the subordination of parent-company subordinated debt, notes BW.
Lehman has scheduled an emergency hearing on 14 September for authority to modify the disclosure statement by deleting guarantees of securities-lending claims from the list of parent-company senior debt and, with approval to modify the previously approved disclosure statement, Lehman said it intends to send out disclosure and voting materials to creditors in the last week of September this year, BW adds.
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