Five Largest American Bankruptcies Countdown

 

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5. CIT
This company was a commercial lender that went bankrupt at a tune of $80 billion on November 2009. Despite CIT’s bailout from TARP (Troubled Asset Relief Program) they still ended up going bankrupt because of all the subprime mortgages which became heavy liabilities for this company.

GM Bondholders

4. GM
GM, which is a car manufacturer went bankrupt for $91 billion. In early 2009 GM relied on a government bailout to keep the factories from shutting down completely. On July of 2010, GM came back from their bankruptcy and in November 2010 they had an almost unprecedented IPO value of $20 billion.

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3. WorldCom
WorldCom was a telecommunications company that went bankrupt in 2002 for $103 billion.CEO Bernie Ebbers of WorldCom was caught in a very large corporate fraud scheme in which he was faking his books to make his company seem larger. WorldCom came back in 2004 as in 2004, shortly after they were bought out by Verizon a year later.

Washington Mutual

2. Washington Mutual
In 2008 Washington Mutual went bankrupt for $327.9 billion in assets. Their stocks went from $30 a share to $2 which lead to customers withdrawing $16.7 billion in deposits within a 10-day span. Banks like Wamu only have to keep 10% of it’s currency in physical form. The other 90% can be lent out to multiple parties. This mass withdrawal was obviously too much for them so the FDIC had to come in to play. JP Morgan Chase bought up their assets for $1.9 billion shortly after.

Lehman_Brothers_4105c

1. Lehman Brothers
Companies like Lehman Brothers; which was a global financial services firm went bankrupt with $639 billion in assets and $619 billion in debt. Lehman Brothers was the fourth largest investment bank in the US. Their bankruptcy was the largest filed in US history in 2008.

http://www.library.hbs.edu/hc/lehman/history.html

http://www.investopedia.com/terms/t/troubled-asset-relief-program-tarp.asp

http://investorplace.com/2012/01/7-largest-bankruptcies-in-us-history-lehman-brothers/6/#.U1bLcCiftS8

http://www.businessinsider.com/largest-bankruptcies-in-american-history-2011-11?op=1

http://content.time.com/time/specials/packages/article/0,28804,1841334_1841431_1841342,00.html

 

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