Replies to post #4250 on Lehman Bros 7.25% Pref''d Series P (fka LEHPQ)

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Lehman Taking Back 100 Million Euros from HSBC Bank

Lehman Brothers Holdings Inc. is taking back another 100 million euros ($131.7 million) that HSBC Bank Plc has been holding as collateral. The new funds coming to Lehman are in addition to 70 million euros received in August 2009.

Before bankruptcy, Lehman maintained several accounts at the bank to provide security for overdrafts or debit balances that Lehman affiliates might have in their customer accounts. In August 2009, HSBC gave back a 70 million-euro excess.

In an agreement approved yesterday by the bankruptcy judge, the bank is giving back another 100 million euros from the 162 million euros remaining in the account. Lehman admits HSBC has a right of setoff in the account.

The agreement by itself doesn’t decide which of the Lehman companies, including the former broker, is entitled to the funds.

Lehman creditors are voting on the Chapter 11 plan in advance of a Dec. 6 confirmation hearing. The Lehman holding company filed under Chapter 11 in New York on Sept. 15, 2008, and sold office buildings and the North American investment- banking business to Barclays Plc one week later. The remnants of the Lehman brokerage operations went into liquidation on Sept. 19, 2008, in the same court, with a trustee appointed under the Securities Investor Protection Act.

The Lehman holding company Chapter 11 case is In re Lehman Brothers Holdings Inc., 08-13555, while the liquidation proceeding under the Securities Investor Protection Act for the brokerage operation is Securities Investor Protection Corp. v. Lehman Brothers Inc., 08-01420, both in U.S. Bankruptcy Court, Southern District of New York (Manhattan).