"With the benefit of hindsight, I can now say that I and many others were wrong," Fuld said Monday in testimony before the U.S. House of Representatives Government Reform Committee.

Fuld said Lehmann relied, in part, on Federal Reserve Chairman Ben Bernanke's relatively mild assessments of problems in the real estate market, The Wall Street Journal reported. He also said Lehman Brothers had attempted to transform itself from an investment bank to a holding company, a move that was unsuccessful.

"Had these changes been made sooner, they would have been extraordinarily helpful to Lehman Brothers," Fuld said.

Rumors about the firm's liquidity problems caused Lehman Brothers to release earnings statements before it could finalize a deal to raise capital, he said,, referring to a deal with the Korean Development Bank that never materialized.

Asked about his executive salary, Fuld said when the firm did well, executives did well and when the firm did poorly, executives didn't do well.