New York (CNN Business) MSNBC host Lawrence O'Donnell on Wednesday night retracted and apologized for reporting a thinly sourced story about President Trump's finances on his prime time show, saying he was "wrong" to have done so.

"Tonight, we are retracting the story," O'Donnell said, adding, "It wasn't ready for broadcast, and for that I apologize."

The about-face came after an attorney for Trump and the Trump Organization sent a letter to NBC demanding the network "immediately and prominently" retract and apologize for what the attorney described as "false and defamatory" reporting.

O'Donnell on Tuesday night offered his audience an explosive story on Trump's finances -- a story he later stressed came from a single source, that NBC had not verified, and that would "require a lot more verification" to be confirmed as fact.

On his program, O'Donnell reported that Trump received loans from Deutsche Bank that had been co-signed by " Russian billionaires close to Vladimir Putin."

The MSNBC anchor cited a "source close to Deutsche Bank" for his reporting.

While discussing his reporting, O'Donnell repeatedly said he wanted to stress that "if true" it would be a huge development.

"I stress 'if true,' because this is a single source," O'Donnell said at one point.

Later in his program, O'Donnell plainly said NBC News had not verified his reporting.

"I want to stress that is a single source, that has not been confirmed by NBC News," O'Donnell said. "I have not seen any documentation from Deutsche Bank that supports this and verifies this. This is just a single source who has revealed that to me."

O'Donnell then added, "And that's where it stands at this point, its going to require a lot more verification before that can be a confirmable fact."

On Wednesday afternoon, after Trump's attorney threatened legal action, O'Donnell tweeted that he "made an error in judgment" by reporting the item.

It's not clear how O'Donnell's reporting made it to air, given that NBC News was unable to verify his reporting.

Usually, at networks, journalists must clear anonymously sourced reports with the network before reporting them on-air or online — a process O'Donnell acknowledged he didn't follow in his Wednesday tweet.

Asked how O'Donnell's reporting made it to air, given how thinly sourced it was and given that the network has not been able to confirm it, a spokesperson for NBC and MSNBC declined to comment.

No other network or news organization, including CNN, has corroborated O'Donnell's reporting. Notably, there was no mention of anything resembling O'Donnell's reporting in the report issued earlier this year by Special Counsel Robert Mueller.

Deutsche Bank would not say publicly Tuesday whether it is in possession of Trump's tax returns. But the bank did acknowledge that US House of Representatives would see people's tax returns if the bank fulfilled a subpoena related to Trump.