They see it as a launch pad to South-east Asia.
SINGAPORE - Singapore’s insurance sector is drawing foreign players seeking to grow their footprint in the Republic and in South-east Asia.
Allianz entered the fray on July 17 with its offer to take a majority 51 per cent stake in Income, another home-grown player. He added that it is therefore not a surprise that major foreign insurers, which do not have a significant presence in the region, embark on acquisitions as a quick way to scale up and gain market share in Singapore.They will have positive impact if they result in economies of scale, knowledge transfer as well as better pricing for consumers, noted Professor Sumit Agarwal, who specialises in finance, economics and real estate at the NUS Business School.
“As long as we do not lose employees, there is no impact on consumers, there is no monopoly power, and the prices for consumers are going down, I think these mergers are good,” he added. Similarly, if Allianz’s offer for Income goes through, Income will benefit from the scale and balance sheets of Allianz, Mr Pigg noted. This will put both insurers in a better position to establish their foothold in the market, he added.
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