Lehman workers sit tight-and drink up

As they await word on their fate, some toil away while others drown their sorrows.

EMAIL  |   PRINT  |   SHARE  |   RSS
 
google my aol my msn my yahoo! netvibes
Paste this link into your favorite RSS desktop reader
See all CNNMoney.com RSS FEEDS (close)
by Mina Kimes, writer

lehman_brothers_bldg.jc.03.jpg
At Lehman headquarters, many were working Friday afternoon while others headed for nearby watering holes.

NEW YORK (Fortune) -- In the giant glass box that holds Lehman Brothers headquarters, plenty of employees were still toiling away Friday afternoon as they waited to learn the firm's fate. Others, though, were heading across 50th Street for a not-so-happy hour.

"It's been incredibly busy," said Shannon Noecker, a bartender at Bobby Van's Steakhouse, which faces the Lehman building. According to Noecker, who said about 30% of her customers are Lehmanites, business booms when banks go down.

"After UBS and HSBC had mass layoffs, we were packed," she said. "Now it's going to get crazy because of Lehman - it's been busy all week, and the traders I know have been drinking a lot. The hard stuff."

Employees trickling out of the building into local lunch spots and a nearby park were mostly tight-lipped about the future of the firm, which is now up for sale after a management plan to shrink and reposition the bank failed to impress investors.

An older Lehman (LEH, Fortune 500) employee who declined to give his name or position, hurried away from the building, briefcase in hand. "The truth is, no one wants to talk about this right now," he said. "It's the same today as it's been over the past three days."

An employee who works in sales agreed. "We're all just sitting around and waiting until we find out who buys us."

She slung an oversized Lehman tote bag over her shoulder and shrugged. "We were hoping for something better, but now we're just sitting back and watching the weekend news."

If Lehman does get bought, it's likely that the new owner will lay off a large portion of the company's 26,000 employees. The business has allocated $6.4 billion towards paying staffers this year - more than double its current stock market value.

One investment-banking analyst spoke with confidence about his job security.

"In banking, we're pretty sure we're going to get bought - and if it's by Bank of America, they're going to value bankers highly," he said. "They've got C level bankers, and Lehman has A bankers."

Whether or not that boast is on target, Richard Bove, an analyst at Ladenburg Thalmann & Co., said on Friday that Bank of America (BAC, Fortune 500) is Lehman's most likely acquirer.

While younger employees will see their compensation and bonuses shrink even if they maintain their jobs, senior staffers, who receive as much as 60% of their compensation in stock, have lost massive sums of money as Lehman shares have tumbled.

The stock has fallen over 90% since the end of last year to just $4.22 a share, and employees have lost more than $12 billion on paper.

Some workers placed the blame for Lehman's downfall, which arose mainly because of the company's massive exposure to real estate, on CEO Richard Fuld. "Dick used to be a well-liked guy, but over the last year, he's become very unpopular," said the saleswoman.

The investment-banking analyst insisted that employees remain loyal to Fuld.

"Sure, we wish he had done what Jamie Dimon did," he said, and steered the firm away from exposure to subprime mortgages. "But he's in the office, working just like everyone else."

The analyst added that he'll be laboring into the night, hoping to impress his future bosses, whoever they are.

But many of his co-workers, he said, will be otherwise occupied: "Everyone's out drinking right now."  To top of page

Features
They're hiring!These Fortune 100 employers have at least 350 openings each. What are they looking for in a new hire? More
If the Fortune 500 were a country...It would be the world's second-biggest economy. See how big companies' sales stack up against GDP over the past decade. More
Sponsored By:
More Galleries
10 of the most luxurious airline amenity kits When it comes to in-flight pampering, the amenity kits offered by these 10 airlines are the ultimate in luxury More
7 startups that want to improve your mental health From a text therapy platform to apps that push you reminders to breathe, these self-care startups offer help on a daily basis or in times of need. More
5 radical technologies that will change how you get to work From Uber's flying cars to the Hyperloop, these are some of the neatest transportation concepts in the works today. More
Sponsors

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.