New York's Metropolitan Transportation Authority is looking for swap counterparties that it hopes will be able to take over derivative contracts with a subsidiary of bankrupt Lehman Brothers Holdings Inc., the agency said yesterday.

The MTA is seeking to replace swap counterparty Lehman Brothers Special Financing, which filed for bankruptcy in October, rather than have them chosen by the courts. A bankruptcy court in Manhattan today will hold a hearing on the fate of 930,000 outstanding derivative contracts involving Lehman Brothers.

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