INVESTORS holding structured products such as Minibonds directly linked to collapsed US investment bank Lehman Brothers are not the only ones facing losses.
Some others who had bought investments that appear to have no links to Lehman Brothers are also sitting in a sea of red ink. But these are only paper losses for the moment, as long as these investors do not sell them. The market value has fallen partly because the debt of some companies they are linked to have plummeted in value.
These jittery investors had bought into products such as DBS High Notes 2 and Morgan Stanley Pinnacle Notes Series 6 and 7, each now worth a microscopic 9 to 12 per cent of their original value.
German investors hit by Lehman collapse too
FRANKFURT: Mr Werner Berkling started worrying when he heard the news of Lehman Brothers' bankruptcy on Sept 15: He had bought two separate securities in February, worth €35,000 (S$70,000).
The fine print made it clear that the American firm was the ultimate guarantor of his investment.
To financial institutions worldwide, the collapse of Lehman Brothers turned what was a mostly American mortgage crisis into a global financial meltdown. But to tens of thousands of individual German investors with modest investments, the Lehman collapse hit much closer to home.
