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Meteor gives update on structured products backed by solvent Lehman subsidiaries

Meteor Asset Management has written to advisers and clients telling them that direct investments backed by solvent Lehman subsidiaries or with third parties are “probably fully recoverable” although it stresses this situation may well change.

A number of Meteor’s plans have invested in securities issued by two Lehman Brothers subsidiaries, Lehman Bothers Securities NV Netherlands Antilles and Lehman Brothers Treasury Co BV Netherlands, both guaranteed by Lehman Brothers Holdings.

In an update issued to advisers on October 3, Meteor highlights that LBT which provides medium term notes that back Isa investments is in administration but LBS NV which backs direct investments is not currently subject to any kind of administration or insolvency procedure.

Meteor stresses that the situation could change in the future but says any positions with solvent Lehman companies or with third parties are “probably fully recoverable”, whereas positions with other Lehman companies which are in insolvency procedures may be “only partially recoverable or not at all.”

Lowes Financial Management managing director Ian Lowes says: “Those with direct investment should not get too excited at the news as whilst LBS is currently apparently solvent it should not be forgotten that it has still lost the backing of the ultimate parent company that provided the strength.”


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