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America's largest bankruptcies

September 18, 2008

1. Lehman Brothers Holdings Inc; $639 billion

The Lehman Brothers bankruptcy, is without a doubt, the largest bankruptcy ever: the size is estimated between $613 billion and $639 billion!

What began life as a general store set up by three German immigrant brothers to the United States, over the years turned into one of US's largest investment banks.

The amazing story of Lehman Brothers' story started in 1844, when 23-year-old Henry Lehman, son of a cattle merchant, emigrated to the United States from Rimpar, Bavaria. He settled down in Montgomery, Alabama, and opened a dry-goods store -- H Lehman.

Later, when his brothers, Emanuel and Mayer, joined him the company changed its name to Lehman Brothers.

The global financial-services firm, which did business in investment banking, equity and fixed-income sales, research and trading, investment management, private equity, and private banking declared itself bankrupt on September 15, 2008.

Why it collapsed?

The fourth-largest investment bank in the United States, and one of Wall Street's biggest dealers in fixed-interest trading, was heavily invested in securities linked to the US sub-prime mortgage market.

As the crisis in financial markets gathered momentum, it saw its share price collapse from $82 to less than $4.

Image: The Lehman Brothers' name is illuminated at the headquarters of Lehman Brothers Holdings In in New York City | Photograph: Mario Tama/Getty Images

Also read: India's top 10 corporate taxpayers
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