INSTANT VIEW: Lehman posts large loss, cuts dividend

NEW YORK (Reuters) - Lehman Brothers Holdings Inc posted a larger-than-expected third-quarter loss of $5.92 per share and slashed its annual dividend, as it plans to sell a majority stake in its investment management division and spin off commercial real estate assets.

The following are reactions from industry analysts and other market participants:

DOUG ROBERTS, CHIEF INVESTMENT STRATEGIST AT CHANNEL CAPITAL RESEARCH, SHREWSBURY, NEW JERSEY

"Right now I would say this is more talk than anything else. What you are dealing with is a confidence issue. They really have to be forthcoming on how they are going to deal with this.

"Unless the overhang is dispelled at this point, I don't see a huge difference on the market. There is still an underlying level of uncertainty as to what Lehman's future is. Essentially, what people are saying is that there has been no resolution of the problem."

THOMAS DI GALOMA, HEAD OF U.S. GOVERNMENT BONDS, JEFFERIES & CO., NEW YORK

"At the end of the day, they may have to find a partner to continue.

"This is reminiscent of Bear Stearns (situation), but Lehman has the Fed (discount) window behind them. That allows them to get cash as needed. They are in a better position than Bear was.

"We did business with them (Lehman) yesterday ... I don't see any reason not to do business with them today."

THOMAS RUSSO, PARTNER AND PORTFOLIO MANAGER, GARDNER, RUSSO & GARDNER, LANCASTER, PA.

"I think most of this has been expected. The amount of risk that crept into the system over the past two years without being properly transparent leaves the market today with the need to process steps that would have been unheard of a year ago.

"The losses from mortgages have overwhelmed the capital at Lehman and the steps required, including the sale of Neuberger, are really quite a drastic turnaround for business.

"It's a remarkable chapter in an awfully strong story over time. So much of what has swept over at Lehman happened quite late. The commercial real estate, the residential apartments and then the swell in the mortgage exposure happened over the last 18 months.

"They cut the dividend. And they placed that commercial real estate in a sort of a runoff sale.

"All of those are in the context of a remarkable downturn from grace for a business that had really done a phenomenal, careful job over the last 15 years.

"It's so hard to really measure the loss in a situation like this because a lot of it has to do with the asset valuation that's kind of directly correlated to the urgency through which the markets have to clear these assets. It is very hard to peg."

ANGUS CAMPBELL, HEAD OF SALES AT CAPITAL SPREADS, LONDON

"Initial thoughts are that they've managed to do all right, but the underlying fact remains that they are seriously struggling as an institution.

"They require someone to help them remain afloat at the moment."

JIM WOOD-SMITH, HEAD OF RESEARCH AT WILLIAMS DE BROE, EXETER, ENGLAND

"Most of the market had worked out (that the results would be bad) but it's still a shock when it happens. With the precedent set at Bear Stearns, the Treasury will have to try to work out how to keep the business going and who to sell it to."

KEITH BOWMAN, EQUITY ANALYST, HARGREAVES LANSDOWN STOCKBROKERS, LONDON

"Initially, the figures have been taken reasonably well. Some expected action or initiatives are being put into place. A bit below expectation in terms of the level of losses and some people read some reassurance into that -- management have gone through a very thorough process in terms of trying to establish the necessary losses.

"Everyone appreciates that they're in a very tight corner. Selling assets in the current environment is not easy. The one thing people do take comfort from is the fact that the Federal Reserve discount window is now open, and that wasn't the scenario when we had the shenanigans with Bear Stearns a few months ago."

"For the time being, it doesn't improve (banks') sentiment to any great degree. Obviously details on Freddie and Fannie ... the market is still coming to grips with those details to some extent, so Lehman following hard onto that, doesn't necessarily suggest a quick recovery is in prospect. At the moment, I don't think it significantly adds to the difficulties."