Asian Banks Major Unsecured Lehman Creditors

Asian financial institutions -- Japanese banks in particular -- are among the 30 largest unsecured creditors of Lehman Brothers, which collapsed Monday, filing for Chapter 11 bankruptcy protection. According to the company's petition, eight Japanese banks are owed $1.62 billion on loans they had extended to Lehman, once a major player in the subprime and alternative-A markets. (Lehman owns Aurora Loan Services of Colorado, the nation's largest alt-A servicer.) Citibank NA and The Bank of New York Mellon Corp. are serving as indenture trustees of the bankruptcy, representing bondholders that are owed upwards of $155 billion. (Separately, Citibank's Hong Kong division is owed $275 million.) According to Peter Chapman of bankrupt.com, a service that tracks bankruptcies, Lehman's junior bonds are now trading as low as 28 cents on the dollar. On Tuesday night Lehman's creditors' committee will hold its first meeting. At $600 billion in assets, Lehman is the largest American company ever to fail. "Before Lehman, Worldcom was the largest at $100 billion, and Enron $70 billion," Mr. Chapman noted.