Two top executives are leaving Lehman Brothers. Rich McKinney, who was the head of American securitzed products business for Lehman, and Ted Janulis, the head of the mortgage capital division, plan to leave the firm, sources with knowledge of the matter said.

Both men worked for divisions closely tied to some of the most precarious sectors of the credit markets. The market in structured products has severely contracted as underlying mortgages have begun to default at unprecedented rates and banks have written-down billions in losses. And we probably don't even need to explain that mortgage capital division of Lehman is in trouble. They aren't originating any mortgages anywhere right now.

Ted Janulis was moved to head the firm's mortgage capital division two years, before that business fell off the cliff. Prior to that he ran the global asset management division, a business which he helped build with the acquisition of Neuberger Berman and the fixed income division of Lincoln Capital. He's been with the firm for 23 years, and on the executive committee for 4 years. Until very recently, Lehman's website listed him as part of the firm's "senior management." Now his entry has been removed. Janulis had a reputation as an excellent manager and is well liked at the firm. He is said to be considering his options, including possibly retiring.

McKinney is taking up a buyside position with another firm. He will be replaced on the structured products desk by Charlie Spero, a trader at the firm.

The departures will likely be read by short-sellers and critics as another sign that Lehman is set to announce huge write-downs and another quarter of losses when it wraps up its third quarter. The departure of Janulis may indicate that Lehman is close to a deal to sell parts of its investment management division, a business that Janulis helped build for the firm. Lehman Brothers declined to comment on the record for this story.

[Editor's note: Yes. This is what we were mumbling about this morning. Absinthe, beer and pretzels are to blame for the delayed reporting.]

Update: Bloomberg and the New York Times chime in on the story!