Fitch rates Potomac Electric bonds A-

Fitch Ratings said it assigned an A- rating to Potomac Electric Power Co.'s proposed new $400 million issue of first mortgage bonds due March 15, 2024.

The outlook is stable.

Proceeds will be used to repay at maturity $175 million, 4.65% senior notes due April 15, 2014 (the notes were secured by a like amount of first mortgage bonds), to repay outstanding commercial paper and for general corporate purposes.

Fitch said credit metrics are relatively well positioned within the current rating category. Going forward, the agency anticipates FFO to debt to range between 18% and 19% and FFO/interest and EBITDA/interest in the 4.5x - 5.0x range. The one measure that is moderately weak for the rating is debt/EBITDA, which is expected to estimate 4.0x over the next few years, the agency said.

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