SWF Radar LehmanBrothers

AFP reports that, “Chinese aluminium giant Chinalco insisted Friday its multi-billion dollar investment in Anglo-Australian miner Rio Tinto was safe, amid reports the collapse of Lehman Brothers had put it at risk.”

Harold James, professor of history and international affairs at Princeton University and professor of history at the European University Institute writes in the Taipei Times that, “China is the US of this century. The initial stages of the credit crunch last year were managed so apparently painlessly because sovereign wealth funds (SWF) from the Middle East, but above all from China, were willing to step in and recapitalize the debt of US and European institutions. The pivotal moment in today's events came when the Chinese SWF China Investment Co (CIC) was unwilling to go further in its exploration of buying Lehman Brothers. CIC's turning back will be held up in the future as a moment when history could have turned in a different direction.”

Bloomberg reports that, “Lehman Brothers Holdings Inc. spurned Korea Development Bank’s offer of $6.40 a share for a controlling stake in the weeks preceding its bankruptcy, the Korean bank’s Chief Executive Officer Min Euoo Sung said.”

Thomson Reuters reports that, “Germany’s Finance Ministry wants an explanation as to why state lender KfW transferred 300 million euros ($426 million) to Lehman Brothers on the day the U.S. bank filed for bankruptcy, a ministry spokesman said on Wednesday.”

Looks like the sovereign wealth hasn’t stopped flowing into Wall Street after all.

The Korea Times tackles a good question.

Thomson Reuters reports that, “Qatar Investment Authority [QIA] has yet to discuss raising its stake in Barclays Plc after the British bank agreed to pay $1.75 billion for some of Lehman Brothers Holdings Plc, a person close to the fund said.”

The Chosun Ilbo reports that, “The crisis at Lehman Brothers, Merrill Lynch and AIG caused heavy losses to Korean financial companies and the National Pension Service.”

Thomson Reuters reports that, “Lehman Brothers Holdings could have avoided bankruptcy had it accepted an offer made by Korea Development Bank (KDB), the head of the state-run bank [Min Euoo-sung] said on Tuesday.”

donga.com writes that, “Bank of America's takeover of U.S. brokerage giant Merrill Lynch and Lehman Brothers' bankruptcy are projected to have significant repercussions on the Korean financial market. The specific takeover terms are likely to affect the financial health of the government-owned Korea Investment Corp., one of the top three shareholders of Merrill Lynch. Worry is also rising over the degree of losses that Lehman's bankruptcy will inflict on Korean financial firms.”

Thomson Reuters reports that, “Norway’s $375 billion sovereign wealth fund said on Monday that it had been prepared for the bankruptcy filing by U.S. bank Lehman Brothers, in which it held more than $840 million worth of stocks and bonds at the end of 2007.”