> British financial regulators ... declared Lehman's assets frozen As did the US regulators. What the FSA did was refuse to allow the assets in the UK to be re

> British financial regulators ... declared Lehman's assets frozen As did the US regulators. What the FSA did was refuse to allow the assets in the UK to be repatriated to the US head office. They did this on the, not unreasonable, basis that once the money was back in the US, the chances of UK creditors getting paid was next to zero. What Lehman's did do was, as you say, speed up the inter-bank liquidity crisis. It also put the clearing houses at risk. That's really what tipped things over the edge and force the governments to step in bug time.