Investigation of the causes of failure of Lehman Brothers with special reference to agency problems - Dissertation Example

Only on StudentShare

Extract of sample
Investigation of the causes of failure of Lehman Brothers with special reference to agency problems

This research study mainly focuses on answering the question related to possible agency problems that were instrumental in the failure of Lehman Brothers. It also evaluates other possible reasons of its failure.
The research study was conducted through a literature review and the case study research method. The report relies primarily on secondary research, making use of the existing literature from various articles, journals, and newspapers.
The findings of this study suggested that agency problems played a significant the fallout of Lehman Brothers with the company managers involved in taking several risky investment decisions, less on behalf of the owners of the company and more in the interests of top management. The high amount of incentive compensations offered to the top executives encouraged them to resort to such business strategies. Apart from the failure of risk management control within the company, its complex organisational structure and the adverse impact of global financial crisis also played a role in the collapse of Lehman Brothers.
This research study can thus be helpful in conducting further research on agency problems that can arise in other business organisations worldwide. It can be helpful for companies to develop various means to overcome such problems, leading to more sustainable and less risky growth and development. ...Show more


Lehman Brothers was amongst the largest investment bankers at the time it was forced to file for bankruptcy and its collapse had significant consequences for the operation financial markets…
Author : hanewalker
Save Your Time for More Important Things
Let us write a custom dissertation on your topic
"Investigation of the causes of failure of Lehman Brothers with special reference to agency problems"
with a personal 20% discount.
Find out more

Related Essays

The Lehman Brothers Collapse. Who, Why, How and Its Long-term Effects on Securities Markets
The Lehman Brothers Collapse during the 2008-09, period is believed to be a very significant as well as interesting topic in the field of Finance as it illustrates the financial blunders committed by the management of the company alongside its long term effects on securities markets.
10 pages (2500 words) Term Paper
Section A: Profiling the corporate structure, and discussing the agency problems
It started its operation in 1849 as the Australian Mutual Provident Society. It was a non-profit organization which worked as a life insurance provider. The major twist came when AMP demutualized in 1998 and got listed in Australia and New Zealand stock exchanges.
13 pages (3250 words) Essay
Were agency problems responsible for the bankruptcy of Lehman brothers in 2008?
The filing of bankruptcy by Lehman Brothers proved to be an unprecedented move which shook the financial industry worldwide. It was September 15, 2008, when Lehman Brothers ultimately filed for bankruptcy protection. It has been recorded to be one of the largest bankruptcy cases in the history of United States.
41 pages (10250 words) Dissertation
Causes for the 2007-2008 Subprime Mortgage Crisis the role of mortgage-backed securities on the bank leverage
Results and Findings 12 2.1 Lehman Brother 12 2.1.1 Lehman Brother before Bankruptcy 12 2.1.2 Bankruptcy of Lehman as a pointer of Subprime crisis 14 2.1.3 Effects of Bankruptcy of Lehman Brothers 16 2.2 Northern Rock 17 2.2.1 Pathway to Bankruptcy 18 2.2.2 Spill over effect of US sub-prime crisis on UK 19 2.2.3 The positive outcome 20 2.3 Housing Price Index 23 4.
34 pages (8500 words) Dissertation
lehman brothers
The cash in from the said “sale” is used to offset debts, a move which allows the company to temporarily pay down its liabilities, thus significantly reducing its leverage. The temporal pay trick is usually long enough to reflect the said “sales” on the company’s published balance sheet, but after the company has declared its financial report, it later borrows money and repurchases its original assets.
8 pages (2000 words) Literature review
Global Financial Crisis: "the U.S. Gov Vs Lehman Brothers Bank" (Case Study)
It was expected that the government would save Lehman Brothers and prevent it from filing for bankruptcy but this was not the case. On the contrary, two days after the fall of this giant firm, America International Group (AIG) was bailed out. The government had earlier helped Bear Sterns by taking a portion of its bad investments that were pulling it down and JPMorgan Chase finally bought the firm.
3 pages (750 words) Essay
Mergers and Acquisitions
The scales of M&A activities are not limited to domestic markets but have significant contribution in foreign markets as well. This rising trends in the number of M&A implies that organizations are spending considerable amount of money and research to acquire companies that has potential to deliver required growth to acquirer or parent entity.
38 pages (9500 words) Dissertation
Financial services ( Derivatives )
In United Kingdom, derivatives can be traded by two methods: either through an over-the-counter (OTC) or organised exchange. The exchange traded derivatives
7 pages (1750 words) Essay
Financial Analysis
The company must be a publicly traded firm that has good financial standing. A full financial analysis of the selected company will be performed in order to determine the viability of the investment.
4 pages (1000 words) Essay
Gillette Company is large manufacturer of personal care products. The company was found in 1901 and was merged into Procter & Gamble in 2005. You have been supplied with the annual report of Gillette Company for the year 2003. Assuming you are an inve
The short-term solvency ratios focus on the capacity of the Gillette Company to pay off its current liabilities (Drake and Fabozzi, 2012). The long-term solvency ratios focus on the
5 pages (1250 words) Essay
Find out how much would it cost
to get a custom paper written by a pro under your requirements!
Win a special DISCOUNT!
Put in your e-mail and click the button with your lucky finger
Your email