Fitch downgrades three Colombia regions

Fitch Ratings said it downgraded the long-term local-currency issuer default ratings on Bogota, Capital District of Colombia and the municipality of Medellin to BBB from BBB+.

The agency also said it affirmed their long-term foreign-currency issuer default ratings at BBB.

The outlooks on these three governments in Colombia also were revised to negative from stable.

Fitch also affirmed the BBB rating on Bogota’s $300 million 9¾% Colombian peso-denominated notes due 2028.

The review follows the recent downgrade of the sovereign rating, the agency said.

The negative outlooks mirror the outlook on Colombia due to the increasing vulnerability of investor sentiment and external financing conditions as the current account deficit reached 6.4% of GDP in 2015, Fitch said.

The agency noted Bogota’s solid operating performance and manageable debt levels, the agency added.

Medellin was noted for its relevant role in the Colombian economy with high and dynamic collection of municipal taxes and significant cash flow, Fitch said.

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