Lehman 10 years on

Setting the scene

The collapse of Lehman Brothers worldwide in September 2008 was one of the defining moments of the financial crisis.

“It’s a credit not only for our current team working at Lehman Brothers, but indeed for all of the hundreds of staff who, at some stage of their time with PwC, have been involved in the administration since September 2008. It wouldn’t have been possible to do all this without drawing on expertise from right across our UK firm and global network.”

Russell Downs, Partner and Lead Administrator of the largest UK Lehman Brothers entity

How we helped

In almost ten years as joint administrators of the UK Lehman Brothers companies, we’ve helped to return more than £36bn of cash and assets to former employees, creditors and trade suppliers.

The approval, in June 2018, of a Scheme of Arrangement by the UK Court has paved the way for a further payout of more than £6bn to creditors, in respect of statutory interest, associated withholding tax and other distributions.

This £6bn distribution is part of a total surplus of around £8bn accumulated after costs and the repayment of unsecured creditors in full.

Over the past few years there have been multiple legal challenges and court debates as to how the final surplus should be distributed between the remaining creditors.

Making a difference

To avoid further litigation and uncertainty, the team worked to broker a compromise between the various stakeholders and to finalise a settlement. As a result the surplus has been unlocked where otherwise they might have remained in dispute.

"10 years ago, there was a global financial meltdown, and Lehman was at its epicentre. The PwC team stabilised the UK business and, without that, we would have seen a much deeper economic downturn. 10 years on, all creditors have been paid in full and I’m proud of the role played by our firm."

Mike Jervis, PwC Partner and Insolvency Practitioner

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Corporate Affairs, PwC United Kingdom

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