A New York Times story said the transaction was part of a regular currency swap of euros for
dollars
that had to be approved by several parts of the bank. Unfortunately
Lehman left KfW in the lurch, accepting the €300 million, but never
sending back the dollars.
The gaffe, being described by KfW as an "automated transfer," has made the bank not only the object
of ridicule in the press, but brought on swift retribution from politicians.
Two of KfW's managing directors and the head of the risk-control
department have already been suspended by the bank's administrative
board, which is composed of politicians and business leaders, with German finance minister, Peer Steinbrück, saying "That's not the final word." -
George WhiteSee story from The New York Times
See Crisis on Wall Street Dealwatch
Heads are rolling at German government-owned bank KfW Bankengruppe as it transferred €300 million ($426 million) into Lehman Brothers Holdings Inc. on the same day the investment bank filed for Chapter 11 bankruptcy protection.
