NEW YORK (AP) — Lehman Brothers Holdings Inc. shares plunged to their lowest level in more than a decade amid investor concerns yesterday that the battered investment bank is running out of options to raise capital.

Investors, anxious about the possibility of a bank failure after the near-collapse of Bear Stearns in March, punished the stock in early afternoon trading. The stock plunged $4.16, or 29.4 percent, to $9.99 — the lowest level Lehman's stock has hit since the collapse of hedge fund Long-Term Capital Management in 1998.

The nation's fourth-largest securities firm has been seeking to boost liquidity after suffering $8.2 billion in write-downs and credit losses since the financial crisis began last year. Lehman had hoped to find a major investor before announcing third-quarter results on September 18, when it is widely expected to take another round of steep losses.

Uncertainty about Lehman's financial position has prompted speculation that the investment bank might announce quarterly results early, a move that could also stem the stock's slide. Prashant Bhatia, an analyst with Citigroup, said Lehman could release details about the third quarter as soon as this afternoon.

"At that point, we expect more clarity around where they are in terms of both earnings for the quarter and any strategic initiatives," Bhatia said. "A pre-announcement will likely be a catalyst to stabilise the stock."

Lehman could report a loss of between $2 billion and $4 billion, according to analysts. That would be on top of a $2.8 billion second-quarter loss, which was the first since Lehman spun off from American Express Co. in 1994.

In addition, Lehman Brothers is also working to quell criticism from major credit rating agencies. Yesterday, Standard & Poor's put Lehman's debt on CreditWatch Negative because of the steep stock decline, which means the agency may lower the company's ratings within months. Such a move would increase the amount of money Lehman pays to issue debt.

"The CreditWatch listing stems from heightened uncertainty about Lehman's ability to raise additional capital, based on the precipitous decline in its share price in recent days," said Standard & Poor's credit analyst Scott Sprinzen.

The steep decline in Lehman's shares began shortly after Dow Jones Newswires reported that the head of South Korea's financial regulator said talks about a possible investment had ended. Lehman chief executive Richard Fuld had been in negotiations with state-owned Korea Development Bank for several weeks about a capital infusion.

However, it appears that report itself is being disputed. Yoo Jae-hoon, a spokesman for South Korea's Financial Supervisory Commission, flatly denied any such statement was made. He said the regulator was "not in a position" to "broadcast how the deal is going".

Mark Lane, a spokesman for Lehman Brothers, declined to comment. A spokesman for KDB could not immediately be reached for comment.

Like other investment banks, Lehman has been hit hard by deterioration in the credit and mortgage markets since the middle of 2007. Global banks during the past year have lost more than $300 billion from mortgage-backed securities and other risky investments.

In addition to securing an investment from KDB, speculation has also centered on Lehman selling its asset management division Neuberger Berman, and spinning off a portion of the company — such as its troubled mortgage-assets. Analysts have said Neuberger could fetch $7 billion to $8 billion in a sale.

Ladenburg Thalmann analyst Richard Bove wrote in a research note that the company might be asking too high a price for an investment or asset sales. The stock is down more than 80 percent so far this year, and traded at $67.72 one year ago.

"Buyers seem to believe that Lehman is overvaluing its assets and refuse to hit the bid," Bove wrote in a research note. "The net result is no action."