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A person walks by a sign posted outside CIBC branch in Toronto in this file photo. (Michelle Siu For The Globe and Mail)
A person walks by a sign posted outside CIBC branch in Toronto in this file photo. (Michelle Siu For The Globe and Mail)

CIBC paying $149.5-million to settle Lehman Estate claim Add to ...

Canadian Imperial Bank of Commerce has agreed to pay $149.5-million (U.S.) to settle a claim with the Lehman Estate, which was set up after the collapse of a onetime Wall Street giant.

The claims were filed against CIBC and numerous other financial institutions in September 2010, two years after the venerable investment bank Lehman Bros. went bankrupt.

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The firm’s collapse was part of a credit crunch linked to the U.S. housing and mortgage industries and made worse by the use of complex financial instruments.

The estate claimed CIBC was obliged to honour a commitment made under one of those agreements before the collapse.

The Toronto-based bank originally reduced its obligation to zero and recognized a $841-million gain after Lehman filed for bankruptcy in September, 2008.

The collapse of a firm that had been considered too big to fail sent shock waves through the global financial industry and contributed to the 2008-09 recession.

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