It was probably only a matter of time, but Freddie Mac (FRE) said Tuesday afternoon in a filing with the Securities and Exchange Commission that it intends to recover its share price above the $1.00 per share floor before the middle of next year, in an effort to remain on the New York Stock Exchange. Under applicable rules, the GSE has until May 18, 2009 to boost its share price, or face suspension and delisting from the Big Board. Freddie Mac said it is currently working with its conservator, the Federal Housing Finance Agency, to determine the specific action or actions that Freddie Mac will take to cure the deficiency. Like Fannie Mae (FNM) last week, however, the only option the GSE may have is a reverse stock split; both GSEs have now signaled an intention to execute the reverse split next year to boost share prices. “Freddie Mac expects to determine the actual number of shares that will produce one share of common stock as a result of any reverse stock split based on both the market price of Freddie Mac’s common stock prior to announcement of the split and additional input from FHFA and Treasury,” the GSE said in a press statement. Fannie warned that it would likely pursue a reverse stock split on Dec. 1. Write to Paul Jackson at [email protected]. Disclosure: The author held no relevant investment positions when this story was published. Indirect holdings may exist via mutual fund investments. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.

More: