Japan's largest brokerage group Nomura Holdings is considering buying a stake in US investment bank Lehman Brothers, reports said on Saturday.

Nomura has funds exceeding $1.87 billion for investment in US and European financial institutions and is considering Lehman as one of its investment candidates, Nomura president Kenichi Watanabe was quoted as saying by the Japanese newspaper Yomiuri.

Nomura plans to confirm Lehman's earnings results for the July-August quarter, expected as early as next week, and will study subsequent share price movements before making a final decision on whether to make an investment offer, the Yomiuri said.

Speculation has been rife in recent weeks that subprime mortgage-hit Lehman could try to reach a deal that would provide a capital injection.

Earlier this week, South Korean media reported that state-controlled Korea Development Bank had made a proposal to acquire 25 per cent of Lehman for as much as $5.3 billion.

Media reports also mentioned China's CITIC Securities or sovereign wealth funds from Abu Dhabi and Qatar as possible alternatives to the Korean bank.