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BALTIMORE GAS & ELECTRIC 'A+' SENIOR DEBT, PREFERRED AFFIRMED BY FITCH -- FITCH FINANCIAL WIRE --

BALTIMORE GAS & ELECTRIC 'A+' SENIOR DEBT, PREFERRED AFFIRMED BY FITCH
 -- FITCH FINANCIAL WIRE --
 NEW YORK, Sept. 22 /PRNewswire/ -- Baltimore Gas & Electric Co.'s (BG&E) 'A+' first refunding mortgage bonds and preferred stock are affirmed by Fitch. The company's outstanding 'A' preference stock is also affirmed. The credit trend is stable.
 Due to supportive regulation, improved nuclear performance, and cost cutting measures, BG&E's financial health has rebounded from problems experienced in the 1989-1991 period, when outages at its two-unit Calvert Cliffs nuclear plant impaired credit quality. BG&E has returned both units to service, improved their performance, reduced costs, and received favorable rate orders.
 With both units operating, BG&E eliminated approximately $350,000 per day per unit in replacement power costs. Other cost savings were achieved through fuel cost reductions, an early retirement program, and the refinancing of over $300 million of high-cost debt. The company also received rate decisions in 1990 and 1991 which permitted it to raise electric and gas rates by $200 million annually. It also issued in excess of $150 million of equity capital in February 1992.
 Continued modest sales growth, ongoing cost control and regulatory support, and good performance of the Calvert Cliffs units should gradually strengthen credit quality measures to a level appropriate for current ratings. Consolidated pre-tax interest coverage is about 2.5 times and should reach the 3.0x-3.5x range within the next several years. Consolidated common equity, roughly 41% of total capitalization, should improve after the completion of a pending common stock offering of up to 7.5 million shares. Additional improvement could be hindered by further fuel write-offs.
 Ultimate recovery of the $458 million in replacement energy costs incurred during the Calvert Cliffs outage remains uncertain, preventing an improving credit trend. The Maryland Public Service Commission is conducting an investigation and is not likely to issue a decision on recovery before late 1993.
 Due to poor performance ad write-downs in the real estate and financial investment segment, BG&E's Constellation Holdings non-utility subsidiary produced a meager return in 1991. Over the long-term, management is redirecting efforts away from poorly performing areas, especially real estate, into the energy segment. Future non-utility activities are not expected to detract from utility credit quality.
 -0- 9/22/92
 /CONTACT: Ed King of Fitch, 212-908-0574/
 (BGE) CO: Baltimore Gas & Electric Co. ST: Maryland IN: UTI SU: RTG


PS -- NY059 -- 2198 09/22/92 12:36 EDT
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Date:Sep 22, 1992
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