S&P lowers four Colombia companies

S&P said it lowered the long-term corporate credit rating on Ecopetrol SA (Grupo de Inversiones Suramericana SA), Oleoducto Central, SA (Ocensa), Interconexion Electrica SA ESP (ISA) and Isagen, SA ESP to BBB- from BBB.

The outlook is stable.

The agency also said it lowered the ratings on Ecopetrol, Gruposura Finance and Ocensa to BBB- from BBB.

The downgrades on these companies follow a similar rating action on the Republic of Colombia, S&P said.

The agency said it believes that these companies won't be able to overcome a sovereign default stress test scenario.

If a sovereign's foreign-currency default occurs, there is a high likelihood that these companies would default as well, S&P explained.

The downgrade of Colombia mainly reflect that its economy continues to suffer from the knock-on effects of lower commodity prices, reflected in the high level of external debt and pronounced volatility in the country's terms of trade, the agency said.

The combination of weaker-than-expected growth in 2017 and reliance on one-off revenues this year to offset revenue underperformance from the 2016 tax reform also demonstrate the difficulty of gradually reducing the general government deficits to comply with Colombia's fiscal rule, S&P said.

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