Lehman in talks to sell mortgage assets: reports

NEW YORK (Reuters) - Lehman Brothers Holdings Inc LEH.N is in talks with prospective buyers, including BlackRock Inc, to sell mortgage assets and other hard-to-value securities, according to reports on Friday.

The reports lifted Lehman's shares by 7.55 percent to

$18.65.

The New York Post reported Lehman was in preliminary talks to sell some $30 billion of commercial mortgages and other assets to a domestic or foreign entity. The bank might provide funding for the sale, the paper said.

Financial news network CNBC reported BlackRock was talking to Lehman about buying mortgages and collateralized debt obligations.

A sale would follow a deal earlier this week from Merrill Lynch & Co Inc MER.N, which said on Monday it agreed to sell $30.6 billion of CDOs for 22 cents on the dollar.

The New York Post, which did not say how it obtained the information, also said the investment bank may have hired Lazard Ltd (LAZ.N) for advice.

The exact reason for hiring the boutique advisory firm could not be learned, NY Post said.

Lehman spokesman Mark Lane declined to comment on the reports. Lazard spokeswoman Judi Mackey declined to comment, as did BlackRock spokeswoman Bobbie Collins.

Wall Street banks have been battered by their exposure to mortgage-backed securities and other risky instruments, which have triggered more than $400 billion of write-downs and credit losses for financial institutions globally.

Investors have been speculating about the fate of Lehman, the smallest of the major Wall Street banks, sharply pushing down its share price after the collapse of rival Bear Stearns in March.

(Reporting by Dan Wilchins and Jennifer Ablan in New York, Additional reporting by Purwa Naveen Raman and Dinesh Nair in Bangalore; Editing by David Holmes and Braden Reddall)