JPMorgan Chase & Co. (NYSE: JPM) purchased $125 million worth of claims on the now bankrupt Lehman Brothers Holdings Inc. from Reserve International Liquidity Fund Ltd. in New York for an unstated price.
The claims amount to commercial paper at a floating rate note issued by Lehman Brothers, according to a filing on Friday from the U.S. Bankruptcy Court in Manhattan.
Obligations from Lehman brothers trade daily amongst banks and other debt investors at discounts from face value at 60% of more.
Reserve International Liquidity Fund is affiliated with Reserve Primary Fund which was the second money market fund to drop below $1.00 per share, leading investors vulnerable to losses on its holdings from Lehman brothers. The news created a run on money market funds which worsened a global freeze in credit markets.
Lehman Brothers was the largest bankruptcy in U.S. history with $639 billion in assets. its creditors included UBS AG, the New York Giants and the Abu Dhabi Investment Authority.