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Deutsche Bank has been named Global Derivatives House of the Year by the editors of DW Online/Derivatives Week.

Bankruptcies of this size are just not supposed to happen. At 5.30am London time this Monday, Lehman Brothers — one of the remaining investment banking giants of Wall Street — announced it was filing for Chapter 11 bankruptcy.

Barclays Capital provided a small glimmer of hope for the thousands of Lehman Brothers staff in Asia this morning, with the news that it may acquire some of the bankrupt firm’s Asian operations. But some warned that Lehman’s Asian capital markets business may not be Barcap’s number one priority.

Asia’s financial markets were reeling on Tuesday as the full impact of the spectacular collapse of Lehman Brothers became clear.

Lehman’s worst mistake was to get its timing wrong — six months ago it might have been saved by Hank Paulson. But Bear Stearns and the US mortgage agencies used up the Treasury’s willpower and that left Lehman horribly exposed and alone.

Korea Development Bank pulled out of negotiations to buy a stake in embattled Lehman Brothers on Tuesday, sparking a week of intense activity amid concern over Lehman’s future.

• $3.9bn Q3 loss racked up after Alt-A hedging failure • $30bn plan to spin-off REI comes too late • Fannie and Freddie bailout euphoria wiped out Lehman Brothers was front, back and centre of events in the credit market this week and at the close in New York yesterday rumours gathered strength that Bank of America is poised to rescue the ailing investment bank.

Lehman Brothers began the week reshuffling its senior management in global fixed income and across the European investment bank as it attempted to put in place a team that could guide it through an independent future.

Korea Development Bank has re-emerged as a potential bidder for a stake in Lehman Brothers, despite comments from Korea’s top financial regulator last week that such an investment was too risky for a state-owned institution.

A noose of market speculation and rumour tightened around Lehman Brothers this week pushing five year default protection on the venerable New York investment bank wider by 70bp to 375bp — equivalent to a lowly double B rated credit.

Credit Investments News is again looking to take the temperature of the market in its second annual Summer Survey that asks the market anonymously where spreads, OIDs, trading levels and other trends will be heading.

Foreign investors are angry at what they see as short-sighted and loose monetary policies in many emerging markets, despite a rally in emerging market bonds this week.