While the deterioration of economic conditions in the United States and Western Europe and the increase in bad assets were gradually proceeding, Lehman Brothers went bankrupt, triggering a sharp decline of confidence in U.S. and European financial institutions, which are mutually involved in a web of complex trade, and this led to a chain of failures and poor performance of financial institutions in the United States and Western Europe.
In addition, these financial institutions had an important role channeling funds to emerging economies in regions such as Central and Eastern Europe and in Latin America. With the outbreak of financial crises in the United States and Western Europe, these institutions suddenly scaled back their exposures to emerging economies, creating problems for these economies too.