Lehman to Raise $6 Billion, Shares Plummet

Moody's Investors Service responded by lowering Lehman's outlook to negative from stable and Fitch Ratings lowered its long- and short-term issuer default ratings to A-plus from double-A negative. Fitch maintained a negative outlook.

Lehman shares had dipped nearly 12% before a 10 a.m. conference call with Lehman CFO Erin Callan, but rose slightly as Callan said that Lehman's liquidity remains strong and provided details on asset sales, which total $130 billion. Liquidity is now $45 billion, compared to $34 billion at the end of the first quarter.

Despite these assurances, Lehman's share price dropped briefly during the question and answer session, as analysts began picking apart some of the data she provided. Shares closed down 8.7% lower at $29.48.

Lehman will formally announce results June 16. The firm has increasingly been viewed on the Street as the logical next shoe to drop, in the wake of Bear Stearns' demise. Bear had to be rescued by the Federal Reserve and sold at a cut-rate price to JPMorgan Chase(JPM Quote) in a deal that Bear shareholders approved last month.

When Life Hands You Lehman, Use Options

Though Lehman looked around the world for investors, most were U.S. institutions in the end, The Wall Street Journal reported. These included C.V. Starr and the New Jersey Division of Investment, the paper reported.

Lehman's shares have plummeted more than 50% in 2008 as investors have grown concerned about its financial health and the extent of its exposure to toxic subprime mortgages.

Other financials, including Merrill Lynch(MER Quote), Goldman Sachs(GS Quote) and Morgan Stanley(MS Quote), also were down fractionally in recent trading.