More on the aborted secret Lehman stake sale talks; CITIC denial; Citigroup lowers Lehman estimates; WSJ: The Fed investigated a rumor last month that Credit Suisse pulled a line of credit from Lehman

Lots of Lehman headlines this morning. There was that FT article that described Lehman's now aborted secret talks to sell a stake to Korea Development Bank or CITIC.  According to one of the potential investors, Lehman CEO Dick Fuld still acted as though he was in the drivers seat, saying “he thinks he is playing with a full deck". CITIC has since come out and denied knowledge of any talks.  In addition, Citigroup lowered earnings estimates  on Lehman (and Goldman and Morgan Stanley) in a report dated 8/20, joining the chorus of already lowered numbers.   And then there's a WSJ article that says that last month the Fed chased down a rumor that Credit Suisse had pulled a credit line from Lehman....

Lehman’s secret talks to sell 50% stake stall - Financial Times

The South Koreans and Chinese walked away after concluding that Lehman was asking too high a price, said New York-based people familiar with the potential buyers. Lehman declined to comment.

Lehman Brothers, the beleaguered US investment bank, held secret talks to sell up to 50 per cent of its shares to South Korean or Chinese parties in the first week of August but failed to reach agreement with either.

However, in spite of Lehman’s share price fall, those who have negotiated with the firm in recent weeks describe Mr Fuld, who wields additional influence as a director of the Federal Reserve Bank of New York, as being as pugnacious as ever. “He thinks he is playing with a full deck,” said one person on the other side of the table.

Citic denies Lehman talks - DJ Newswires via FinancialNewsOnline 

Tan Ning, board secretary of Citic Securities, said Thursday he is unaware of any talks between the Chinese brokerage and Lehman Brothers about taking a stake in the US bank.....

Analysts see tough quarter for investment banks - Reuters 

....Citigroup analyst Prashant Bhatia widened his third-quarter loss estimate for Lehman Brothers Holdings Inc. Bhatia... 

Bhatia expects Lehman to take fresh asset-related writedowns of $2.9 billion. He expects $1.8 billion in writedowns at Goldman and $1.7 billion at Morgan Stanley. 

Citigroup's Bhatia cut his earnings estimates for Goldman to $2.50 a share from $4.50, and for Morgan Stanley to 75 cents a share from 76 cents.
 
  He widened his third-quarter loss view for Lehman to $3.25 a share from 41 cents a share.

Fed Acted on Lehman Rumor - WSJ 

In an apparent attempt to prevent a repeat of the cascading rumors that helped sink Bear Stearns Cos., the Federal Reserve last month quietly called one major bank to see if it had pulled a credit line from Lehman Brothers Holdings Inc., people familiar with the matter said.
 
  Responding to a July rumor that Credit Suisse Group planned to pull a line of credit to Lehman, Federal Reserve officials called to see if it was in fact true, according to these people. Credit Suisse told Fed officials there was no truth to the rumor and it had no intention of pulling the line of credit, the people said.....