One Year Later, Lehman Bank Still in Business

September 17, 2009

A visit to the last major operating business of the once swaggering Wall Street firm Lehman Brothers feels a bit like entering a pawn shop.

Customers dropping by the “main branch” of the former Lehman Brothers Bank must knock to catch the attention of staff, who then press a buzzer to unlock the glass doors to the office.

The bank lacks the cushy chairs offered by nearby TD Bank or the lounge area with TVs at PNC Bank across the street in downtown Wilmington, a subdued city south of Philadelphia that is perhaps best known for being a place where many major companies are registered because of business-friendly laws.

A year after Lehman Brothers Holdings Inc declared bankruptcy, exacerbating a crisis that led to a trillion dollar rescue of the global financial system, one of its biggest remaining operations scarcely attracts the attention of anyone passing by.

The arrival of a reporter at the branch on the anniversary becomes a big event for the half dozen staff. They all vacate their desks and teller stations to gather and watch as their manager politely declines to answer any questions.

There is a small desk where customers can fill out deposit slips, but there is little sign it has been recently used. Accounts have to be opened online for what is largely an Internet bank.

A paper sign on the door says “no change given” and requests visitors report to building security.

It is all an indication of how far the once mighty Lehman Brothers has fallen.

Gone are Lehman Brothers’ investment banking operations, the private bank, the brokerage businesses and trading desks, as almost every Lehman unit has been unloaded to a new owner or shut down.

The former Lehman Brothers Bank has remained and is not part of the bankruptcy. In the first few months of the parent company’s bankruptcy, the bank website even continued to advertise an application for a Lehman Brothers credit card.

The bank was optimistically renamed Aurora Bank FSB in April — Aurora being the goddess of the dawn in Roman mythology.

It employs more than 1,700 — the bulk of Lehman Brothers remaining staff — with most in loan servicing operations in Colorado and Nebraska. Other than that, the bank only has two branches: this one in Wilmington and another in Jersey City, New Jersey.

Source: Reuters

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Written by djumper · Filed Under Real Estate Blog