Odds On: Next financial services company to shut down or be sold

Odds On: Next financial services company to shut down or be sold With the yo-yo performance of the U.S. financial markets, the never-ending mortgage crisis and the recent near collapse of Bear Stearns, one thing is clear - only people outside of Wall Street suffer the consequences. But now the online bookmaker BodogLife is giving its punters the opportunity to cash in on the downfall of Wall Street with its latest business betting props and when the next financial service company or bank collapses (or gets sold), hopefully you'll come out a winner. That's right, BodogLife is offering betting odds on the next company to follow Bear Stearns. And considering the following quote from Bloomberg's Craig Torres "America's financial system faces its biggest overhaul since the Great Depression", another acquisition or even bankruptcy appears quite possible.

The bookie has posted odds on seven financial service providers to go belly-up or be sold by June 30th of 2008 and right off the bat Lehman Brothers Holdings (NYSE:LEH) shapes as the worst business of all seven, listed with odds 2/1 to collapse or be sold by the end of June. The New York based company's stock closed at $42.49 on Wednesday and has seen better and worse days. The 52-week high is $82.05 and the 52-week low is $20.25. A good call by the bookmaker, considering the shares of Lehman Brothers slumped last week, after DBS Group Holdings Ltd., Southeast Asia's largest bank, sent an e-mail to several traders instructing them not to conduct any new dealings with Lehman Brothers or Bear Stearns Cos. Now we all know what happened to Bear Stearns, and although the shares of Lehman Brothers have recovered a bit since, the 2/1 bet seems to be a safe one. The current credit crunch will likely tie up Lehman Brothers Holdings Inc.'s balance sheet with illiquid assets and lower global sales, an analyst at Oppenheimer's Whitney said this Monday while downgrading the investment bank from "outperform" to "perform".

Meanwhile, Citigroup Inc. (NYSE:C), despite trading close to its 52-week low of $17.99 (Citigroup stock closed at $22.05 on Wednesday) is the underdog, which in this case is a good thing, listed with odds 10/1 to shut down or be sold by the end of June at BodogLife. Citigroup just settled a lawsuit over the bank's alleged role in Enron's 2001 collapse, reaching a $1.66 billion agreement with Enron Creditors Recovery Corp., Enron's successor corporation, which will put a dent in the company's wallet but nothing compared to the $18 billion in damages (with additional $3 billion in prebankruptcy payments) Enron was looking for. Either way, from Lehman Brothers Holdings to Citigroup Inc., there is a good chance for another collapse. Here is the full list of betting odds on the next bank to shut down or be sold by the end of June 2008, as published at BodogLife:

Morgan Stanley - 7/2

Lehman Brothers Holdings - 2/1

Goldman Sachs - 3/1

Merrill Lynch - 6/1

Citigroup - 10/1

UBS - 6/1

Barclays Capital - 8/1

Published on 03/27/2008