S&P gives FirstEnergy units’ bonds BBB

S&P said it assigned its BBB issue-level rating and 1+ recovery rating to the senior secured first-mortgage bonds at Potomac Edison, West Penn Power and Pennsylvania Power Co. The agency also placed the ratings on CreditWatch with negative implications. The 1+ recovery rating indicates S&P’s highest expectation of full recovery, resulting from significant over-collateralization, at least 150%, for lenders in default.

S&P said it plans to resolve the CreditWatch placement on the subsidiaries and parent FirstEnergy Corp. in the coming months, pending the outcomes of multiple investigations, criminal allegations and civil lawsuits at FirstEnergy.

“All of our other ratings on the companies are unchanged, including the BB issuer credit rating at the three companies,” S&P said.

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