Some ex-Lehman employees do well out of bankruptcy

Former London-based staff of Lehman Brothers have been handed salaries and bonuses by the defunct investment bank’s administrators close to those paid before its bankruptcy five years ago.

The Telegraph reports that Tony Lomas, the PricewaterhouseCoopers partner in charge of the administration of Lehman Brothers’ international operations, said he had 'no qualms' about paying former investment bankers close to what they earned at the failed broker.

'There are some highly paid people. We pay the market rate', said Mr Lomas.

Five hundred former employees of the investment bank’s 5,500 UK-based staff still work for PwC on the resolution process, which has so far cost £662m, or about 3% of the funds handed back to creditors.

PwC has cut staff numbers this year as the larger parts of the workload have been completed.

The administrators have so far paid dividends to unsecured creditors equal to 68.5p on every £1 owed, but say they could end up making them whole and even paying interest.

So far, about £15bn has been returned and a further £6bn of client assets and money owed will be handed back later this month. Eventually PwC expects to return as much as £40bn.

The wind-up has been aided by the large amounts of capital that were held by LBIE five years ago. Lomas said the balance sheet held about £11bn, consisting mostly of shareholders’ equity.

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