Calpine Credit Rating Lowered by S

Calpine Corp.’s unsecured credit rating was cut three levels by Standard & Poor’s after the U.S. power-plant developer pledged assets to its bankers in return for credit lines.

S&P; lowered Calpine’s unsecured bond rating to B+, four levels below investment grade.

Calpine pledged assets such as its U.S. and Canadian gas assets and its Saltend power plant in the U.S. to persuade its bankers to extend $2 billion of credit. Holders of Calpine’s unsecured bonds now rank behind bankers in terms of payment if the company were ever to file for bankruptcy.

Shares of San Jose-based Calpine fell 23 cents to $13.68 on the NYSE.