Fremont Faces Delisting from NYSE
Troubled banking outfit Fremont General (FMT) said Tuesday that the New York Stock Exchange was likely to delist the company's common stock over a failure to maintain a high enough stock price. Stocks that trade below one dollar for 30 consecutive days are deemed to fail the so-called "quantitative continued listed standard" established by the Exchange. The stock closed Monday at 48 cents, and has traded below the $1 benchmark since the beginning of March. The troubled lender has seen its stock plummet more than 90 percent during the past year, after the bank nearly collapsed as the subprime mess first began; the Brea, Calif.-based operation maintains $8.8 billion in assets and 22 branches in California. Fremont's latest round of troubles began in late February, saying that write-downs and loss reserve charges had eroded its capital base; since that time, it has defaulted on loan purchase contracts worth $3.15 billion and delayed an interest payment on $169 million in debt. The FDIC stepped in during late March and ordered the troubled lender to capitalize or sell itself within 60 days. Disclosure: The author owned no positions in FMT when this story was originally published. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.