WALL STREET – The stock prices of mortgage giants Fannie Mae and Freddie Mac plummeted Wednesday after announcing they had been ordered to delist from the New York Stock Exchange.
Fannie Mae’s stock was down 45% Wednesday morning to 51 cents and Freddie Mac’s stock was down 47% to 65 cents.
The Federal Housing Finance Agency, the federal regulator for the two secondary mortgage market giants, said the delisting order was not taken due to the companies' performance.
The two companies have been hemorrhaging red ink and have tapped more than $145 billion combined in federal aid. They have an open credit line with the Treasury Department through 2012.
OTC trading of shares of the two companies is expected to start approximately July 8.
Fannie Mae said in a statement the switch should not affect its ability to provide liquidity and stability to the mortgage market, or its focus on foreclosure-prevention and refinancing under the Making Home Affordable Program.
Freddie Mac said it expects its shares will be quoted on the OTC Bulletin Board "so long as market makers demonstrate an interest" in trading the securities.
