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KDB ends Lehman investment talks Lehman reports third quarter loss
(about 4 hours later)
Korea Development Bank (KDB) has said talks with Lehman Brothers have ended for now with regard to possible investment in the US bank. Troubled US bank Lehman Brothers has reported a third quarter net loss of $3.9bn (£2.2bn) as it unveiled radical restructuring plans.
As well as slashing its dividend, the firm also said it would cut its exposure to distressed commercial property assets.
On Tuesday, the bank's shares plunged 45% on fears about the state of its financial health.
The dollar fell against other major currencies after the announcement.
Earlier, Korea Development Bank (KDB) said it had pulled out of talks with Lehman Brothers with regard to possible investment in the US bank.
"We are announcing that we ended talks at this point in time because of a disagreement over conditions of a transaction and considering domestic and foreign financial market conditions," KDB said in a statement.
State-run KDB said the decision came because of disagreement over terms and current financial market conditions.State-run KDB said the decision came because of disagreement over terms and current financial market conditions.
Lehman Brothers is set to announce its "key strategic initiatives" on Wednesday as well as quarterly results.
A Wall Street Journal report said Lehman might be considering selling UK property assets to BlackRock.
Shares in US investment bank Lehman Brothers had plunged 45% overnight on fears over its finances, sending the main Wall Street stock indexes down sharply.
Amid fears that Lehman is struggling to raise $6bn (£3.4bn) to cover sustained credit crunch-related losses, its shares ended down $6.36 at $7.79.
The main concern regarding Lehman had been that a potential investment from KDB would fall through.
Lehman, the fourth-largest US investment bank, had hoped to secure a deal with the Korean fund before announcing its third-quarter earnings.Lehman, the fourth-largest US investment bank, had hoped to secure a deal with the Korean fund before announcing its third-quarter earnings.
However on Wednesday, KDB said in a statement: "We are announcing that we ended talks at this point in time because of a disagreement over conditions of a transaction and considering domestic and foreign financial market conditions." A Wall Street Journal report added that Lehman might be considering selling UK property assets to BlackRock.