Moody's drops Edison Funding

Moody's Investors Service said it downgraded the senior unsecured notes of Edison Funding Co. to Ba3 from Ba1, concluding the review for downgrade that was initiated on Aug. 13.

The outlook is stable.

According to the agency, the downgrade reflects the increased probability that Edison Funding will breach a financial covenant of a minimum net worth test in its financing documents based upon the disclosure by parent company Edison International in its March 31 10-Q that a substantial after-tax write-off of around $550 million to $600 million would occur at Edison Capital and its subsidiaries.

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