Jefferies Projects Limited Losses From First Brands Exposure

2025-10-13 02:00:41

(MENAFN- AsiaNet News)

Jefferies Financial Group (JEF) said that its projected financial losses from auto supplier First Brands are relatively low in an effort to ease concerns around its dealings with the bankrupt firm.

The lender said Jefferies' investments in the troubled auto parts firms effectively comprise $43 million, or 5.9%, of Point Bonita's accounts receivable purchased from First Brands and a small interest in First Brands' bank loans through Jefferies Finance's Apex platform.

“We are confident that any losses or expenses from these investments or otherwise in respect of First Brands can readily be absorbed and do not threaten our financial condition or business momentum,” Jefferies said in a statement.

Last week, Jefferies revealed that its Leucadia Asset Management fund, through its credit fund Point Bonita, held about $715 million in receivables linked to First Brands. The company filed for bankruptcy protection in late September after its creditors began investigations due to alleged financial irregularities.

Retail Sentiment on Stocktwits about Jefferies was in the 'bearish' territory at the time of writing.

JEF's Sentiment Meter and Message Volume as of 12:45 a.m. ET on Oct. 13, 2025 | Source: Stocktwits

“We believe there has been an impact on our equity market value and credit perception that is meaningfully overdone, and we expect this to correct soon as the facts and range of outcomes are better understood,” the Wall Street lender said in a statement.

Jefferies also stated that no one at the firm was aware of any fraudulent activity at First Brands, noting that it had served as the financial advisor for only one deal over the past decade. In other instances, it has been engaged with different companies that were making a deal with First Brands.

Jefferies' stock fell 18.7% over the past week, erasing hundreds of millions of dollars in market valuation from the fallout of the bankruptcy of First Brands and subprime lender Tricolor Holdings.

Investors have raised concerns about the booming private credit market, which has helped firms such as First Brands to raise funds for their aggressive growth strategy.

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