Thousands of employees, who had turned up as usual for work on Monday in London's Canary Wharf, filed out of the building ashen-faced after finding they no longer had a job.
But even Lehman's woes did not grab the headlines for long. Those of other major financial institutions soon overshadowed them.
Bank of America bought Merrill Lynch, one of Wall Street's proudest names, in what most investment professionals are viewing as a rescue operation. Meanwhile, insurance giant AIG had to be bailed out to the tune of $85billion (£48 billion) by the US Federal Reserve.
The Fed was not the only central bank to be digging deep this week, however. The Bank of England injected £5billion into the markets, while the European Central Bank pumped in €30billion (23.8billion). Others, such as the Bank of Japan, also delved into their reserves in a desperate bid to stem the turmoil that engulfed financial markets as traders took in the news.
Unfortunately for Halifax and Bank of Scotland owner HBOS, this was not enough to prevent its shares plunging to the extent that it was forced to accept an emergency takeover offer from high street rival Lloyds TSB.
Under normal circumstances, it seems unlikely that competition authorities would have approved the merger of these two banks. HBOS was already the UKs biggest mortgage lender, while Lloyds TSB led the pack in the current account arena.
Given the potentially catastrophic impact of an HBOS collapse, however, the deal was rushed through in a matter of hours creating a banking giant worth 30 billion.
One reason HBOS found itself in so much trouble was that traders keen to make a quick buck were short selling its shares, which is when investors borrow shares from another investor, and then sell them on hoping the price will fall. The aim is then to buy back the asset at a lower price and return it to its owner, pocketing the difference.
However, City watchdog the Financial Services Authority has now stepped in to prevent any other financial services firms suffering the same fate as HBOS by imposing a temporary ban on the short selling of 29 stocks.
Its efforts were rewarded with a rebound in the stock market fortunes of Britains biggest banks and US financial regulator the Securities and Exchange Commission was quick to follow suit.
US officials are also working on a plan to help rid US banks of their bad debts after Wall Street giants Morgan Stanley and Goldman Sachs became the latest to have their shares punished by
Whether or not these steps prove enough to prevent any further disasters, one thing is certain: The financial services industry will never be the same again.