Lehman Brothers to pay creditors $14.2 billion
NEW YORK -- Lehman Brothers said Wednesday it will pay about $14.2 billion to creditors in its third distribution under a bankruptcy restructuring plan.
The investment bank, which collapsed in September 2008 at the height of the financial crisis, said in a court filing that it will distribute the money on April 4. That will bring to $46.9 billion the total amount distributed to creditors since a federal bankruptcy judge approved Lehman's restructuring plan in December 2011.
Distribution amounts vary widely depending on what kind of claim the creditor holds, and on which division of Lehman.
Holders of unsecured claims against Lehman Brothers Financial Products Inc., a derivatives subsidiary, receive the full amount they are owed. Those holding senior unsecured claims against the parent company receive only about 6 percent of what they're owed.
The fourth distribution is expected to be made in September.
Lehman was the biggest corporate bankruptcy in U.S. history. Its failure caused a panic among financial companies which feared that Lehman-related losses would topple other firms.
The government stepped in with billions of bailout money and subsidies to prevent other big Wall Street banks from failing.