Daily Real Estate News | September 15, 2008
Financial Giants Fall Victim to Mortgage Crisis
Weighed down by losses in the U.S. mortgage crisis, the stability of major financial institutions continues to be shaky. On Monday, U.S. investment bank Lehman Brothers Holding Inc. filed for bankruptcy and Bank of America announced that it would be buying struggling Merrill Lynch.
Lehman's is the largest casualty, so far, in the past year in the ongoning credit crisis. Lehman filed for bankruptcy on Monday following a failed attempt over the weekend to find a buyer.
Concerns over the stability of other firms also looms, particularly after the U.S. government's decision not to provide any bailout for Lehman. In March the government provided financial backing for JPMorgan's takeover of Bear Stearns, the first big bank to fold under the mortgage crisis.
Also on Monday, No.2 U.S. bank giant, Bank of America announced it would be buying Merrill Lynch in a $50 billion deal.
|"Acquiring one of the premier wealth management, capital markets, and advisory companies is a great opportunity for our shareholders," Bank of America Chairman and Chief Executive Officer Ken Lewis said in a statement. "Together, our companies are more valuable because of the synergies in our businesses." |
The buyout is expected to close in the first quarter of 2009.