Profits at Lehman Brothers tumbled 31% in the second quarter after a sharp fall in revenues in investment banking and particularly proprietary equities trading, setting a miserable tone for the first round of quarterly reporting by Wall Street firms this week.

Net income at Lehman from March to the end of May was $296m (€329m) compared to $369m in the firm's fiscal second quarter in 2001. Every main business line saw revenues fall in the second quarter with the exception of fixed income, which posted a 2% increase in secondary business and flat revenues in debt underwriting, and private clients, where revenues rose nearly 8%.