LONDON, Sept. 16 (UPI) -- British bank Barclays said Monday it was talking with Lehman Brothers about buying some of the firm's core business assets.

Lehman Brothers filed for Chapter 11 bankruptcy protection Monday in a historic day on Wall Street that included Merrill Lynch accepting a rescue offer from Bank of America (NYSE:BAC) .

U.S. Secretary of the Treasury Henry Paulson Jr., set up talks between Barclays and Lehman Brothers over the weekend but Barclays backed away after learning the U.S. government wasn't interested in providing a guarantee in Lehman Brother's massive debt, The Times of London reported Tuesday.

Barclays said a deal was contingent on shareholder approval and offered "no assurance" a deal could be struck. It wasn't considering any purchase of Lehman Brother's international businesses, The Times reported.

"What's going on in New York is a private sector effort," Paulson said Monday. "We're working through a difficult period in our financial markets right now as we work off some off the past excesses."

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