The continued decline in home values and further fall out from the credit crunch has forced one of the largest investment banks in the world to raise additional capital. Lehman Brothers, for the second time in the past six months has raised an additional six billion dollars worth of capital. The investment banking firm has been one of the largest investors in mortgage backed securities and cash derivatives. The firm reported a quarterly loss that was larger than anticipated. The investment banking world has been reeling since the fall of 2007 when the sub prime mortgage crisis became national news. Earlier this year one of the world larges investment banks, Bear Stearns was forced out of business as their exposure to mortgage securities and leverage investing in these assets resulted in a run on the bank where investors in large numbers withdrew their funds and all but eliminated the companies ability to fund transactions.

6-9-2008 ©LowRateMortgage.com

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