Barclays wins $1bn on Lehman payout

BARCLAYS yesterday won a $1.1bn (£682m) payout from the trustee of Lehman Brothers’ estate after agreeing a value for disputed assets linked to its purchase of Lehman’s US arm.

The payment settles a dispute over how much “clearance box” assets that were held to facilitate the clearance of securities trading should be worth.

A US bankruptcy court ruled in February that Barclays was entitled to the funds, but the two sides disagreed over whether it should be paid their original value of $869m or a larger amount based on the addition of interest or appreciation.

Barclays, led by chief executive Bob Diamond (pictured) said the $1.1bn accord represented the appreciated value of the underlying assets.

However, an attorney for Lehman trustee James Giddens said the figure represented the $869m plus interest. The accord settles part of a total $3.5bn dispute over former Lehman assets in a US bankruptcy court but debate over the remaining billions is still ongoing.

Giddens’ attorney argued that Barclays should return the $2.1bn it received when it bought Lehman’s US brokerage business, and pay interest.

Barclays said it inherited about $6bn in liabilities when it agreed to take on Lehman’s proprietary cash margin held at clearing houses. Even if that were offset by other assets related to the deal, a $1bn offset is still in order, it argued. Judge James Peck, delayed his ruling yesterday to take longer to review the arguments.