Although, the rating agency took the Independent Credit Profile of the municipality managed by Rafael López Aliaga to negative terrain.
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Fitch Ratings maintained the long-term foreign and local currency issuer default rating (IDR) of the Metropolitan Municipality of Lima (MML) at negative.
It is worth noting that since November of last year the MML — now managed by Rafael López Aliaga — saw its reputation diminish as a result of the deterioration of Peruvian political stability.
In addition, Fitch downgraded MML’s Independent Credit Profile (SCP) from -aa to bbb+, which according to the agency remains above Peru’s sovereign rating (BBB/negative).
“Their negative outlook reflects the Outlook on the sovereign’s IDRs,” they added in a statement.
Fitch concludes that the lower SCP is mainly due to the change in the risk profile of the municipality, and with it, the risk profile of the Municipality of Lima is similar to that of other Latin American local and regional governments.
A month ago, Moody’s also reduced the outlook for the Municipality of Lima’s credit rating to negative due to uncertainty about the ability to manage Rafael Lopez Aliaga to improve their resource holdings over the next 2-3 years, “which increases liquidity risks.”
Source: Larepublica
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