As the reason for the moratorium, BaFin stated that it had to be ordered to secure those assets still remaining. The institution was threatened with imminent inability to meet its payments obligations after in the US several companies belonging to the group had filed for Chapter 11 protection against creditors and in the UK had been placed under administration.

The BaFin measures are immediately executable but not yet final.

Lehman Brothers Bankhaus AG with its registered office in Frankfurt am Main has branches in London, Milan and Seoul. Based on its last adopted annual financial statement as at 31 December 2007, the bank’s balance sheet total stands at roughly 16,200.0 million euros. The institution has liabilities towards institutional customers amounting to some 11,000.0 million euros. As the German Ministry of Finance, BaFin and the Bundesbank informed in a joint statement on Monday, investments of German credit institutions held with Lehman Brothers Holding were within reasonable limits and manageable.

Moreover, the German Ministry of Finance, BaFin and the Bundesbank were in close contact with their international counterparts and leading executives from the German banking industry. They were watching further developments on the national and international financial markets very closely.

The deposits of customers of Lehman Brothers Bankhaus AG are protected under the German Deposit Guarantee and Investor Compensation Act (Einlagensicherungs- und Anlegerentschädigungsgesetz – EAEG). The institution belongs to the Compensation Scheme of German Banks (Entschädigungseinrichtung deutscher Banken GmbH – EdB). The basis for the EdB to pay compensation to the investors in a case of compensation determined by BaFin is provided for in German legislation. The EdB must inform creditors of the institution without delay if such case exists. The statutory compensation claim of each entitled bank customer is limited per investor to 90 per cent of his deposits and the equivalent amount of 20,000 euros. Lehman Brothers Bankhaus AG is also a member of the Deposit Protection Fund of the Association of German Banks (Einlagensicherungsfonds des Bundesverbandes Deutscher Banken e.V.). According to its statute, this Deposit Protection Fund assumes the 10 per cent deductible amount and the part of the deposits exceeding the statutory limit of 20,000 euros – up to the respective protection limit, which for each investor amounts to 30 per cent of the bank’s liable equity capital, and thus approximately 285.1 million euros.