The Singapore government intervened to stop a proposed deal between Income Insurance and German-based insurance giant Allianz, with three Cabinet ministers explaining the rationale.
German insurer Allianz announced in July it was planning to buy a majority stake in Singapore's Income Insurance . The decision came after the Ministry of Culture, Community and Youth raised concerns over how the Singapore insurer’s cash pile of about S$2 billion would have been handled.
The key concern was that the move would undermine Income's social mission, and would see workers and Singaporeans’ interests abandoned if it became part of a profit-driven international player.The idea of a foreign entity owning a majority stake in Income Insurance, with which Singaporeans have deep emotional ties, also unsettled some.
Prime Minister Lawrence Wong also wrote on Facebook that the government's concerns were with the structure and terms of this specific transaction,"particularly in the context of assurances which Income had given to MCCY when the former was corporatised in 2022".
This proposed capital reduction so soon after the transaction “runs counter” to the premise for why the exemption was given, said Mr Tong. “On the contrary, it may strengthen it by ensuring capital is more efficiently deployed, hence enhancing returns to shareholders,” he said. “The relationships between prudential considerations and social mission can be complementary although there may be areas of tension,” he said.
Following Mr Tong’s announcement, Income said it respects the government's decision and appreciates its understanding of both the purpose of its 2022 corporatisation exercise and its plans to partner with Allianz.
NTUC Allianz Edwin Tong Chee Hong Tat CNA Explains
Philippines Latest News, Philippines Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Singapore government blocks Income-Allianz deal as it is 'not in public interest'The Singapore government has stepped in to stop the proposed deal between NTUC Income and German insurer Allianz. It's also introducing new measures to safeguard future deals that involve insurers with a social mission, like Income.
Read more »
Allianz to consider revising Income offer after current deal blocked by Singapore GovtIncome and NTUC Enterprise said that they will work closely with relevant stakeholders to decide on the next course of action.
Read more »
Allianz-Income Deal in Singapore Scrapped Amid Public Interest ConcernsThe proposed acquisition of a controlling stake in local insurer Income Insurance by German insurer Allianz has been called off due to concerns over the deal's structure and potential impact on Income's social mission. The Singaporean government, after reviewing the transaction, decided it was not in the public interest to proceed with the deal in its current form.
Read more »
Allianz to consider revising proposed Income deal; respects Singapore government's positionIncome Insurance also said that it "respects" the government's decision and will work closely with the relevant stakeholders to "study and decide on the next course of action", taking into account the upcoming amendments to the Insurance Act.
Read more »
Allianz to consider revising proposed Income deal; respects Singapore government's positionIncome Insurance also said that it "respects" the government's decision and will work closely with the relevant stakeholders to "study and decide on the next course of action", taking into account the upcoming amendments to the Insurance Act.
Read more »
Commentary: What the surprise decision on Income-Allianz deal says about the Singapore government’s prioritiesThe Singapore government’s decision to block the Income-Allianz deal is telling of the new leadership’s willingness to act when there are important principles at stake, says former veteran newspaper editor Han Fook Kwang.
Read more »