Lehman Brothers, Barclays Reach Deal: Report

Government officials, including Treasury Secretary Henry Paulson, had said they were reluctant to provide funding or guarantees for a Lehman rescue.

The government is finding itself increasingly on the hook for the credit crisis that began to envelope financial institutions last summer. Last week, it took over troubled mortgage giants Fannie Mae (FNM Quote) and Freddie Mac(FRE Quote), and earlier this year, the Fed agreed to backstop JPMorgan Chase's (JPM Quote) purchase of failing investment bank Bear Stearns.