The day has come for Freddie Mac (NYSE: FRE) and Fannie Mae (NYSE: FNM). Freddie Mac has notified the New York Stock Exchange of its intent to delist its common stock from NYSE trading. It is also affecting the 20 listed classes of its preferred stock which trade on the NYSE. The issue is going to affect Fannie Mae as well and both stocks were halted.
This notice was made after a directive by the Federal Housing Finance Agency (FHFA), Freddie Mac’s conservator. The directive requires Freddie Mac to delist its common and preferred securities from the NYSE, and this will affect Fannie Mae as well it appears as the FHFA issued similar directives to both Freddie Mac and Fannie Mae.
Freddie Mac intends to file a Notification of Removal from Listing on or about June 28, 2010 and it anticipates that the delisting of its common and preferred stock from the NYSE will become effective on or about July 8, 2010.
Freddie Mac notes: After the delisting of our equity securities from the NYSE, we expect that our common stock and the classes of preferred stock that were previously listed on the NYSE will be traded in the over-the-counter market and quoted on OTC Bulletin Board (OTCBB) under a ticker symbol that has yet to be assigned.
What is funny is that the FHFA thinks this is a mere mechanical event:
- “FHFA’s determination to direct each company to delist does not constitute any reflection on either Enterprise’s current performance or future direction, nor does delisting imply any other findings or determination on the part of FHFA as regulator or conservator,” said FHFA Acting Director Edward J. DeMarco. “The determination to direct delisting is related to stock exchange requirements for maintaining price levels and curing deficiencies,” DeMarco said.
In short, if you own Freddie Mac (and Fannie Mae) you own an OTC stock now rather than just an NYSE penny stock.
The FHFA release is here. Adios!
JON C. OGG
Sponsor: 3 Recovery Stocks to Own Now – Get the names of the best cheap stocks to rebuild your wealth in 2010 and beyond.
Sponsored: Find a Qualified Financial Advisor
Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to 3 fiduciary financial advisors in your area in 5 minutes. Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests. If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.