Moody’s lifts Ohio Power, bonds to A2

Moody's Investors Service said it upgraded Ohio Power Co.’s long-term issuer rating and senior unsecured bonds to A2 from Baa1, and revised the outlook for its parent company American Electric Power Co., Inc. (AEP Baa1), to positive from stable.

The outlook was changed to stable from positive.

Concurrently, the agency affirmed the ratings of AEP, including its Baa1 senior unsecured rating and its Prime-2 rating for commercial paper.

Moody’s said the upgrade of Ohio Power reflects the utility's strong financial performance and the supportive regulatory relationship that has been demonstrated in recent years as Ohio looks to finally complete the transition of its electricity markets to deregulation.

The two-notch upgrade reflects the agency’s general view of the supportive regulatory trend in Ohio, and Ohio Power’s strong and predictable financial profile, which includes a ratio of cash from operations excluding changes in working capital (CFO pre-WC) to debt in the low 20% range over the long-term.

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