Investment bank Jefferies (JEF) revealed that its Leucadia Asset Management fund holds approximately $715 million in receivables linked to First Brands Group, which recently filed for bankruptcy with over $10 billion in liabilities.
- Shares of Jefferies dropped 2% following the disclosure.
- First Brands halted payments to Point Bonita, a fund managed by Leucadia, on September 15.
- UBS is also assessing exposure, reportedly over $500 million.
- Analysts estimate Jefferies’ maximum potential loss at around $44.6 million, with clarity expected in Q4.
The situation underscores the risks in trade-finance and corporate debt markets, particularly following recent bankruptcies in the auto parts and subprime lending sectors.