Standard & Poor’s (S&P) has lowered the rating on Mercantile Mutual Insurance after the company was acquired by QBE. The $740 million purchase of ING’s 50% stake in Mercantile Mutual was finalised on June 30.

In keeping with normal S&P practice, Mercantile Mutual’s rating was set at the same level as its parent. And now that Merc Mut doesn’t have Dutch financial giant ING in the owner’s seat, that means a downgrade from AA- to A+.

S&P insurance analyst Michael Vine says the downgrade aligns the ratings on Mercantile Mutual with the principal operating subsidiaries of QBE, including QBE Insurance Australia.