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NEW YORK–Lehman Brothers Holdings Inc. shook up its management yesterday, removing two top executives in a concession that attempts to quell Wall Street anger over recent losses.

The U.S.’s fourth-largest investment bank said chief financial officer Erin Callan and chief operating officer Joseph Gregory have been removed from their positions, days after the company announced a $3 billion (U.S.) quarterly loss.

Investors were shaken after the company disclosed on Monday that it needed $6 billion of fresh capital to offset that loss, its first since going public in 1994.

"When you have a stumble of this magnitude, change is not a bad thing," said Lauren Smith, an analyst with Keefe, Bruyette & Woods. "I view the change, on the margin, as a good thing, but this runs a lot deeper than just changing a few high-level managers."

Since March, Callan had been taking on an increasingly more prominent profile as the face of Lehman during the credit crisis. She regularly met with analysts and appeared at investor conferences to talk up the company.

On Monday, Callan again waved the flag – telling analysts on a telephone call that Lehman’s books were in order and that the fresh dose of capital would allow traders to pursue new opportunities. But her pep talk failed and shares began to plummet toward a record low.

The lack of confidence in Lehman’s leadership has been hanging over the company for weeks http://paydayloans-on.com. It was unclear if the management upheaval will be enough to satisfy critics.

The uncertainty was compounded by the near-collapse of Bear Stearns under the weight of similar rumours last March. The Federal Reserve later stepped in to negotiate the investment bank’s sale to JPMorgan Chase & Co.

Callan and Gregory join a long list of executives who have lost their job since global banks and brokerages began writing down nearly $300 billion of bad investments stemming from bad bets on mortgage-backed securities. Others include Merrill Lynch CEO Stanley O’Neal, Citigroup CEO Charles Prince and Morgan Stanley co-president Zoe Cruz.

Callan, who took the CFO spot last September, will remain with Lehman in its investment banking division, where she previously ran a hedge-fund group. Gregory will also remain with the firm in an undetermined position. He will be succeeded by Herbert McDade, previously the global head of the company’s equities division. Ian Lowitt, the current co-chief administrative officer, will become CFO.

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