Moody's downgrades Ohio Power

Moody's Investors Service said it downgraded Ohio Power Co.'s senior unsecured rating to Baa1 from A3 and its preferred stock to Baa3 from Baa2.

This concludes a review for possible downgrade begun in January, and the outlook is stable.

The agency said the downgrade primarily reflects its expectation that Ohio Power's financial credit metrics will remain in a range that is more appropriate for the Baa-ratings category over the near to intermediate term horizon. These financial credit metrics include a ratio of cash flow from operations before working capital adjustments to debt in the high teens to 20% range.

The Baa1 rating also reflects the positive attributes associated with being a rate-regulated electric utility in Ohio, the near to intermediate-term regulatory certainty associated with the recent settlement regarding the Electric Security Plan entry on rehearing, an adequate over-all liquidity profile and the status of being one of the core principal operating utility subsidiaries of American Electric Power Co., Moody's said.

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