S&P; Reduces Edison’s Credit Rating : Utility: The downgrade follows similar moves by two other agencies. The firm says no dividend cut is planned.

Standard & Poor’s Corp. on Wednesday joined two other financial rating agencies in downgrading Southern California Edison’s credit rating.

Also Wednesday, Edison said the company is not considering a cut in dividends because of this week’s financial setbacks.

S&P; lowered Edison’s rating two notches, from AA to A+. Fitch Investors Service and Duff & Phelps Credit Rating Co. made equivalent downgrades to Edison’s rating Tuesday. Lower credit ratings can increase the interest rates charged to borrow money.

The downgrades were prompted in large part by a decision Monday by the state Public Utilities Commission to reduce the allowable return on equity--a utility’s equivalent of profit margin--for Edison and five other California utilities in 1993.

The commission also denied Edison’s request to increase its share of equity compared to debt from 46% to 48% as another means to decrease the utility’s risk in credit markets. Standard & Poor’s cited both decisions in downgrading Edison’s rating.

“The support of California regulators (for utilities’ financing needs), which is strongly influenced by the state’s economic downturn, has deteriorated significantly,” Cheryl E. Richer, an S&P; corporate finance director, said in a statement.

PUC senior financial specialist Carol A. Siegal said the commission had to consider the effect not only on investors, but on ratepayers and the overall public interest--including environmental and business-climate concerns.

“I think the commission would be very supportive of giving another look at the issue,” Siegal added, if a utility can “fairly well demonstrate . . . that there are real benefits to a higher debt rating supported by a higher return on equity.” As to Edison’s common stock dividend, the company will announce any changes after the board meeting scheduled for June 17, 1993.

Edison “is not contemplating a reduction in its dividend” because of Monday’s PUC decision, said Alan J. Fohrer, vice president and chief financial officer. Any decisions about future dividend increases will be based on the larger factors of Edison’s business performance and long-term outlook, Fohrer added.

In recent years, the utility has maintained an annual dividend increase of 8 cents a share. “We’re going to evaluate that in June when we look at the dividend,”said W. James Scilacci, manager of corporate finance and investor relations.