NYSE suspends $1 rule Posted Feb 27th 2009 10:50AM by Zac Bissonnette Filed under: Good news, Amer Intl Group (AIG) The New York Stock Exchange has decided to temporarily suspend (subscription required) a rule requiring that companies be kicked off the exchange when their shares fall below $1 for 30 consecutive days. With the stock market in free fall, many once proud companies have seen their shares dive into that bargain basement, and the NYSE has decided it doesn't want to add fuel to the fire by sending them off to Casino Pink Sheets. The exchange also said that it would maintain its relaxed minimum market cap standard of $15 million -- down from the usual $25 million. Both new policies will be in effect until June 30th, unless they are renewed. This new rule probably won't have too much effect on investors because most NYSE-traded companies that tank below $1 are probably headed to zero anyway -- companies like American International Group (NYSE: AIG). But the relaxed listing standards will give distressed issuers one less thing to worry about, even if it does come at the expense of the prestige of the NYSE. Here's my question: Will the NYSE really be able to follow through with its plan to restore heightened listing standards as soon as the beginning of July? Barring a miraculous market comeback, there will still be many, many companies set to be kicked off the exchange when that deadline hits. As of right now there are 56 NYSE-listed companies trading below $1.
Nice of them to change the rules to protect the innocent. This makes the NYSE look like fools and that should help consumer confidence.