Jeremy Isaacs, the long-serving chief executive of Lehman Brothers's international operations, is leaving the troubled US investment bank as part of a wider shake-up of its senior management.

London-based Mr Isaacs, who is credit with spearheading Lehman’s expansion in Europe and Asia in his 12 years at the bank, will step down at the end of the year.

Benoit Savoret, chief operating officer for Europe and the Middle East, and Andrew Morton, who runs the bank’s fixed income division — traditionally its cornerstone — are also leaving.

The departures are announced as Lehman seeks to repair its balance sheet after sustaining heavy losses from the credit crunch.

It has already taken $7 billion (£3.9 billion) in credit-related writedowns since the start of the credit crisis and is expected to announce further losses when it publishes its quarterly results.

Lehman's shares have dropped more than 75 per cent this year but bounced last week amid suggestions that it has found private equity buyers for some of its assets.

It has been talking to Korea Development Bank about buying a stake and is thought to have come close to a deal with Royal Bank of Canada this summer to acquire it outright.

Mr Isaacs had been expected to leave after missing out in June on taking over as president of Lehman — a job that has gone to Bart McDade, head of the bank’s equities division.

Last year, Lehman drew more that half of its $6 billion income from outside America.

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