Citadel's Big Lehman Fall

It’s long been suspected that Ken Griffin’s Citadel Investment Group took a big blow when Lehman Brothers went bust nearly a year ago. But Griffin and his management team have been reluctant to put a number on the damage to the Chicago-based fund.

That is, until now.

In a brief, one-page filing (.pdf), Citadel claims it is owed some $470 million on a derivatives contract. The $12 billion hedge fund conglomerate offers no details about the derivatives deal in the proof of claim, submitted as part of the Lehman bankruptcy filing.

To date, Citadel’s claim is the third largest submitted by a creditor in the bankruptcy.

As the one-year anniversary of Lehman’s collapse approaches, expect more hedge funds and banks to fess-up about their Lehman losses.

Comments

[Alpha1000]

I think to "fess-up" is the wrong term to use.

To trade a contract with Lehman which they can not pay out on is somewhat different to making a bet on Lehman itself (like buying Lehman shares, etc). It's at least a 'second order' mistake!

I for example had the misfortune of being long AIG variance with the counterparty being... Lehman.

2009 Aug 26 05:05 AM