It's All Over People, Lehman To Settle MBS Suit For Half A Cent On The Dollar

Lehman Brothers

Pending court approval, Lehman Brothers Holdings will pay out $40 million to investor groups to settle damage claims totaling $7.7 billion, reports Reuters.

This will bring legal closure, however paltry, to Lehman’s toxic subprime mortgage bundling that nearly brought the global financial system to its knees in 2008.

Of course, a raft of other banks face similar claims. Goldman Sachs is looking at $15.8 billion in MBS-related claims (Reuters). In total, the FHFA is suing banks for $100 billion.

This chapter of the Lehman saga ends not with a bang, but with a whimper. Reuters quotes Steven Toll, an attorney representing investors: “[$40 million] is modest given the potential damages in the case, but under the circumstances it is a good result. The problem is there was just no money to get.”

Next up for what remains of Lehman: bankruptcy reorganization. A hearing on the matter is scheduled for December 6th, reports Reuters.

Don’t miss: Someone Paid $33,000 For The Worthless First Share Ever Issued By Lehman Brothers >>

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at research.businessinsider.com.au.