Fitch keeps Edison International on negative watch

Fitch Ratings said it maintained Edison International's and Southern California Edison Co.'s A- issuer default ratings and individual securities ratings on rating watch negative.

The action primarily reflects potential financial exposure to destructive California wildfires that raged across the state in 2017, causing significant damage in Southern California Edison's service territory and regulatory uncertainty with regard to recovery of such costs, the agency said.

Fitch originally placed the ratings on negative watch on Feb. 26.

The agency said it believes rating pressures associated with wildfire liabilities are unlikely to exceed two notches.

“While the cause of the fires are yet to be determined, a finding that SCE equipment was involved in igniting the fires could potentially expose the utility to third party liabilities under claims based on the theory of inverse condemnation or, if inverse is not applied by the Superior Court, negligence,” Fitch said in a news release.

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