NEW YORK, Jan 23: The New York Stock Exchange will temporarily lower the minimum market capitalisation required for listed companies due to the recent “extreme volatility and an overall decline” in stocks.

The Big Board, operated by NYSE Euronext, said on Friday it will require companies to maintain a market cap of $15 million, down from $25 million, over a 30-day period in order to avoid delisting.

The rule change, effective through April 22, comes as exchanges worldwide struggle to avoid a crush of costly delistings caused by the credit crisis and subsequent market sell-off.

NYSE, the largest exchange by the market cap of its listings, has never before suspended its listing requirements.

The number of stocks tripping NYSE’s delisting threshold has “been significantly higher than the historical norm,” and many remain suitable for continued listing, NYSE’s oversight body said in a statement.

“The exchange believes that, in many cases, these companies have experienced precipitous stock price declines because of these unusual market conditions, rather than company-specific problems,” NYSE Regulation said in a statement.

NYSE delisted 53 companies last year because they failed to meet minimum listing requirements. It was the most since 2002, the last year of the dot-com sell-off.

NYSE dropped another four companies this month, including Nortel Networks Corp, which tripped the exchange’s minimum share price requirement at the same time that the telecom firm filed for bankruptcy protection.NYSE’s main US rival, Nasdaq OMX’s Nasdaq Stock Market, suspended its minimum-price listing requirement for similar reasons in October. Nasdaq’s suspension is effective through April 20.

Andrew Brenner, co-head of corporate bonds and emerging markets at MF Global, said NYSE’s move reflects the sharp decline in market valuations and the exchange’s desire to retain listings.

“It’s just a sign of the times the fact that valuations of companies have gone down and if they were adhere to their past procedures they would lose a lot of companies,” Brenner said. —Reuters