Lehman Brothers Holdings Inc. reported record net income of US$1.15 billion for the first quarter ended February 28, up 6% from the first quarter of fiscal 2006.

The firm also reported record net revenues in the Capital Markets and Investment Management segments. And, it said it enjoyed record net revenues in both Europe and Asia. Overall net revenues were a record US$5.0 billion, up 13% from the same period a year ago.

Chairman and CEO Richard Fuld, Jr. said, “By expanding our global footprint, building our capabilities and partnering with our clients, we have again posted record net revenues, net income and earnings per share. Our results clearly demonstrate that we are better positioned than ever to create value for our clients and our shareholders.”

Capital Markets record net revenues were up 15% from the first quarter of fiscal 2006, driven by strong performances in both Fixed Income and Equities Capital Markets. Fixed Income Capital Markets reported net revenues of US$2.2 billion, its second highest revenue quarter and an increase of 3% from US$2.1 billion in the first quarter of fiscal 2006, reflecting record results in credit products as well as a strong performance in real estate, partially offset by declines in securitized products due to weakness in the U.S. residential mortgage sector and in interest rate products. Equities Capital Markets reported record net revenues of US$1.3 billion, an increase of 42% from US$944 million in the first quarter of fiscal 2006, driven by continued growth in execution services and prime brokerage activities, as well as solid customer flow activities and strong equity markets.

Investment Banking reported its second highest revenue quarter, increasing 2% to US$850 million from US$835 million in the first quarter of fiscal 2006. These revenues were driven by record debt origination, which increased 4% to US$428 million from US$410 million in the first quarter of fiscal 2006, and strong merger and acquisition advisory revenues, which increased 9% to US$247 million from US$226 million in the first quarter of fiscal 2006, partially offset by lower revenues in equity origination as compared to the first quarter of fiscal 2006.

Investment Management reported record net revenues of US$695 million, an increase of 20% from US$580 million in the first quarter of fiscal 2006. This performance was driven by record revenues in both Asset Management, which increased 13% to US$416 million from US$368 million in the first quarter of fiscal 2006, and Private Investment Management, which increased 32% to US$279 million from US$212 million in the first quarter of fiscal 2006. Assets under management grew to a record US$236 billion.

The firm’s pre-tax margin was 33.7% for the first quarter of fiscal 2007, compared to 34.8% for the first quarter of fiscal 2006. Return on average common equity was 24.4% for the first quarter of fiscal 2007, compared with 26.7% for the first quarter of fiscal 2006.