Binary Binching

Employees of Lehman Brothers in Asia were nervously waiting to hear their fate on Monday as the loss-making U.S. investment bank stared at potential collapse.

Asia, where Lehman employs about 3,000 staff excluding the India back office, has proved a sweet spot for the U.S. bank as it made inroads into new markets in the region.

'The situation is quite fluid. We haven't heard anything from New York,' a Lehman executive in Singapore, who asked not to be identified due to the sensitivitiy of the situation, told Reuters by telephone.

'I guess we'll have to wait for the marching orders.'

The Wall Street bank had expanded aggressively in Asia in the last two years, ramping up foreign exchange and investment banking operations in Singapore, Hong

Kong and Mumbai.

It was also planning a bigger presence in China where it recently advised Aluminum Corp of China (Chinalco), which teamed up with Alcoa, on its $14 billion purchase of a stake in Rio Tinto.

For many employees, communication early on Monday was made more difficult because of a holiday in Hong Kong and Tokyo -- the bank's larger offices in Asia.

'Everyone is anxious about what is going to happen,' said another Lehman staffer in Singapore by telephone, adding management had circulated notes to staff last week in the face of growing employee concern and impatience.

At Lehman's Singapore office at the downtown Suntec Tower, only a trickle of staff arrived for work, dodging reporters' questions.

At a nearby coffee bar, two Lehman staffers said they had been called at 6.00 a.m. (2200 GMT Sunday) to be at work at 7.00 a.m.

Asked whether it was business as usual, a Lehman trader contacted by telephone told Reuters: 'What business is there? There's nothing to do. All I've heard is what's being reported on the news.'

Uncertainty also prevailed in Australia, where Lehman entered markets last year through the acquisition of local brokerage Grange Securities for about A$120 million ($98 million).

Earlier this year, the company moved to a new office tower in Sydney's central business district to accommodate its expanded team.

'The negotiations are still ongoing ... basically we don't know where we stand,' said one of the bank's Sydney-based employees. 'Say, for example, there was a filing for Chapter 11, where would that leave all of us ... probably we stand behind other creditors.

'The only thing we could do here is just sit until we hear something more definitive. And almost certainly that would have to happen, I would have thought, before New York opens.'

Michelle Sprod, a Lehman spokeswoman in Sydney, said the firm was declining any comment.

MERRILL SALE

The seismic shakeup in the U.S. financial system could also see Bank of America buying Merrill Lynch & Co Inc , said a source briefed on the matter -- a move likely to be closely watched by Singapore sovereign fund Temasek Holdings [TEM.UL] which has injected more than $5 billion in Merrill since December and would have had an around 14 percent stake.

A Temasek spokesman declined to comment on reports that Merrill could be sold.

Merrill Lynch spokesperson in Sydney, Danielle Mapes, said: 'We're not commenting at this stage'.

Last month, Temasek said it saw value in banking stocks in the United States and Britain and could invest more if an opportunity arose.

The Government of Singapore Investment Corp (GIC), the bigger of the city-state's two sovereign funds, had also bought significant stakes in UBS and Citigroup.

Source: forbes.com

And to think that Merrill Lynch has been giving recruitment talks in NUS (the next one will be in two days time), how bleak can the near future get?