S&P cuts Petroperú’s outlook to negative and downgrades its rating to “junk”

This Tuesday, Standard & Poor’s (S&P) downgraded Petroperú’s long-term rating from BBB- to BB+, one notch where junk bonds are located. This level is where S&P Global Ratings classifies those companies that are at risk of default.

The rating agency also changed the state oil company’s outlook from stable to negative. Fitch Ratings also recently downgraded Petroperú’s credit rating and upgraded its long-term issuer default rating to BBB- from BBB. This is Fitch’s seventh seat, just one step away from those notes that are considered speculative.

Finch argued that the downgrade of the outlook to negative (RWN) as well as the review of the rating reflects the lack of financial transparency and the weakening of Petroperú’s governance.

With information from Bloomberg.