Shares of Lehman Brothers Holdings Inc. are down sharply on Monday after the Wall Street bank reported a US$2.8 billion loss in the second quarter against an expected loss of around US$300 million.

It was the first ever loss for Lehman as a public company, and was triggered by marking assets to market and losses in proprietary trading.

Lehman pre-released its earnings in order to raise new capital. The company said it plans to raise $6 billion through the issue of 2 million convertible shares and 143 million common shares. CNBC reported the common shares will be priced at $28 per share and that the deal is oversubscribed. Details should be released at around 10 a.m. EDT on Monday.

On Friday, Lehman closed at $32.29, but is down to $30.50 in pre-market trading.

Lehman's loss per share was $5.14, against the consensus mean estimates for 0.375 cents.

By Adam Button and edited by Cristina Markham