By Pedro Nicolaci da Costa and Mathieu Robbins (Reuters)

NEW YORK/LONDON - The Federal Reserve has already dug so deep into its policy toolbox during the credit crisis that any future bank rescue like that of Bear Stearns might be more difficult to engineer.

Fears of another Wall Street flare-up simmered this week after the Wall Street Journal reported Lehman Brothers Holdings Inc (LEH) would have to raise as much as $4 billion or more to cover possible losses, and Standard & Poor's cut the company's bond rating.

Bankers say a sale like that of Bear Stearns earlier this year to JP Morgan, or any sale at all, is unlikely for Lehman in the near term because the bank is on much stronger footing than its fallen counterpart. Moreover, its potential acquirers have their own problems.

"It's a very different situation from Bear Stearns," said one senior investment banker.

Without extra help, analysts say the ongoing crisis makes Lehman unattractive to any potential buyer, despite a drop of more than 50 percent in the U.S.-based investment bank's share price so far this year.

Luckily for the Fed, many investors believe Bear Stearns was a one-time debacle that will not likely be repeated. Less favorably, the chances of mimicking the Bear bailout plan, which involved providing $30 billion for JP Morgan to buy it, are much slimmer this time around.

"Is Lehman going to have problems? I wouldn't be shocked," said William Fleckstein, president of Fleckstein Capital in Seattle, Washington. "If it gets to that point, I don't know what the Fed is going to do."

One big problem is a lack of probable candidates. Many of the deep-pocketed U.S. commercial banks have problems of their own. Two of the biggest, JP Morgan and Bank of America, are already making hefty acquisitions, with BofA set to take over Countrywide.

This leaves European banks as potential bargain-hunters. Among candidates to acquire Lehman, the name of British bank Barclays Capital often comes up, as do those of HSBC (HSBA) and Swiss banks Credit Suisse (CSGN) and UBS (UBSN).

However, these banks, too, have recently come under strain. Credit Suisse warned in March it could report its first quarterly loss in five years. UBS, meanwhile, has fired thousands of staff and taken several write-downs over its exposure to the credit crunch.

HSBC has also faced losses from its exposure to the U.S. mortgage market and is coming under increasing pressure to break itself up.

Wachovia, meanwhile, jettisoned its chief executive earlier this week, prompting speculation that loan losses linked to the purchase of a big mortgage lender could widen.

"There is just no likely buyer out there at the moment," said the same banker. "Until earlier this week Wachovia would have been a possible but that's no longer the case. The two Swiss have their own problems, as do HSBC."

Broader investor skittishness is also an obstacle to large M&A transactions, barring situations like Bear Stearns, where the asset was cheap enough to minimize the buyer's risk.

Still, there was a sense of inevitability in the markets that suggested somehow, some way, Lehman would eventually be up for grabs.

"The very likely outcome for Lehman is that it's going to be bought," said Chip Hanlon, president of Delta Global Advisors in Huntington Beach, Calif.

Hanlon does not believe Fed policy-makers would have to intervene either, citing Bear Stearns' role as a dominant clearinghouse for Wall Street trades as a possible source of the central bank's worry about systemic risk.

"Bear was unique in that way," said Hanlon.

Unique or not, the Fed's response to Bear was certainly unprecedented. Not only did the central bank directly expose its balance sheet to credit risk by taking on assets of questionable value, but it also broadened access to its discount window for emergency borrowing to investment banks. Until March, such a privilege was only granted to depository institutions.

Those steps are now seen as a watershed moment in the crisis, and they have helped many assets like corporate bonds and financial company stocks recover from their lows.

They may also help prevent another Bear from ever occurring, some analysts believe. In fact, there are those who say that access to the discount window at an earlier moment might have prevented Bear from coming to the brink of bankruptcy, although policy-makers deny that is true.