Lehman Brothers profits dip in third quarter results

Source: Stock Market Digital

Date :19/09/2007 09:21:55

The US investment bank remains optimistic despite the three percent decrease, the first drop in five years.

Lost revenues, largely attributed to the global credit crisis, cost the company $700 million (£350 million) over the third quarter.

Lehman Brother’s Chairman and Chief Executive Officer, Richard S. Fuld, Jr. said in the report released today:

Challenging conditions

“Despite challenging conditions in the markets, our results once again demonstrate the diversity and financial strength of the Lehman Brothers franchise, as well as our ability to perform across cycles.

“For the quarter, we reported record net revenues in Investment Management, and our second highest net revenues in both Investment Banking and Equities Capital Markets. In addition, more than half of our net revenues for the quarter came from outside the U.S. We remain focused on delivering significant long term value for our clients and shareholders.”

Lehman Brothers is the first Wall Street bank to publish its third quarter results in a week due to feature reports from fellow heavyweights Goldman Sachs, Bear Stearns and Morgan Stanley.

Remarkable capabilities

Its performance has come as a surprise to some, especially as it was thought one of the most vulnerable to the ‘credit crunch.’

David Easthope, a senior financial analyst said:

“Lehman’s third-quarter results show the remarkable capabilities of the investment banks to weather market storms.

"Pessimists will cite that fixed-income business was down almost 50 per cent, due to weak credit and securitised products. However, the equities and derivatives business was strong, as was investment management."

Related Links

Lehman Brothers

Goldman Sachs

Bear Stearns

Morgan Stanley