We take a look at the events of 2008 that lead up to the collapse of Lehman Brothers Holdings Incorporated.
February 22 : Northern Rock bank is nationalised by the British Government, due to financial problems caused by the subprime mortgage crisis.
March 16 : Bear Stearns is acquired for $2 a share by JPMorgan Chase in a sale avoiding bankruptcy.
May 6 : UBS AG Swiss bank announces plans to cut 5,500 jobs by the middle of 2009.
September 7 : Federal takeover of Fannie Mae and Freddie Mac.
September 14 : Merrill Lynch is sold to Bank of America amidst fears of a liquidity crisis and Lehman Brothers collapse.
September 15 : Lehman Brothers files for bankruptcy protection
September 17 : The US Federal Reserve lends $85bn to American International Group (AIG) to avoid bankruptcy.
September 19 : US government announces a financial rescue plan after a volatile week in stock and debt markets.
September 25/26 : Washington Mutual is seized by the Federal Deposit Insurance Corporation, and its banking assets are sold to JP MorganChase for $1.9 billion.
October 6–10 : Worst week for the stock market in 75 years. The Dow Jones loses 22.1 percent, its worst week on record, down 40.3 percent since reaching a record high of 14,164.53 October 9, 2007. The Standard & Poor’s 500 index loses 18.2 percent, its worst week since 1933, down 42.5 percent in since its own high October 9, 2007.
October 14 : The US announces the injection of $250 billion of public money into the US banking system.
November 12 : US Treasury Secretary Paulson abandons plan to buy toxic assets under the Troubled Asset Relief Program (TARP). He says the remaining $410bn in the fund would be better spent on recapitalising financial companies.
November 24 : The US government agrees to rescue Citigroup under a detailed plan that includes injecting another $20 billion of capital into Citigroup bringing the total infusion to $45 billion.
November 25 : The US Federal Reserve says it is to inject another $800bn to help revive the financial system. $600bn will be used to buy mortgage bonds issued or guaranteed by Fannie Mae, Freddie Mac, and the Federal Home Loan Banks.
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