Fitch upgrades PG&E

Fitch Ratings said it upgraded the long-term issuer default ratings of PG&E Corp. (PCG) and its primary operating utility subsidiary, Pacific Gas and Electric Co. (PG&E), to A- from BBB+.

Fitch also said it upgraded PCG's senior unsecured debt to A- from BBB+ and PG&E's senior unsecured debt to A from A-.

The short-term issuer default ratings on both companies were affirmed at F2.

The outlook also was revised to stable from positive.

The ratings reflect the group’s strong and improving EBITDAR and FFO leverage metrics despite of its financial exposure to large fines and penalties at PCG's gas operations, Fitch said.

The ratings also consider the continuation of credit-supportive California and federal regulation, along with the effective execution of PG&E's large capital program, the agency said.

The company continues with a balanced issuance of debt and equity to meet external funding requirements and maintain PG&E's 52% statutory equity ratio, Fitch noted.

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