Singapore’s Minister for Transport and Second Finance Minister Chee Hong Tat said the Ministry of Culture, Community and Youth (MCCY) had commented on Income Insurance’s social mission and the rationale for the NTUC Enterprise and Allianz deal.
Minister Chee said the focus would be on regulatory aspects. Monetary Authority of Singapore (MAS).
Former NTUC Income CEO Tan Suu Kyi raised In an open letter to the Monetary Authority of Singapore (MAS), NTUC Income raised concerns about corporate governance issues and how the sale to Allianz could undermine the company’s social mission.
Allianz last month announced plans to buy a 51% stake in Singapore’s Income Insurance for about S$2.2 billion (EUR1.5 billion).
The MAS assessment highlighted the regulator’s role in promoting a healthy financial sector, with a focus on insurers’ risk management and protecting long-term insurance policies.
When assessing a change in beneficial ownership, criteria such as track record, financial strength and suitability are considered.
The Minister confirmed that MAS was satisfied with Income’s board’s process in managing conflicts of interest in relation to the transaction.
Ronald Ong, Chairman, Income Insurance Limited I declined From the Board of Directors’ decision to appoint Morgan Stanley as financial advisor to the Allianz acquisition transaction.
The move was made to avoid a potential conflict of interest, as the chairman also serves as a senior executive at Morgan Stanley.
Minister Chee asserted that fostering a competitive insurance market is key to ensuring affordable insurance options.
Allianz is a large global insurer but has a small presence in retail and small business insurance in Singapore, which does not have a significant overlap with Income’s business.
The Minister highlighted the competitiveness of Singapore’s insurance market, with over 50 insurers offering a range of products.
He pointed out that Income doesn’t always offer the cheapest prices compared to other insurers, citing life insurance and Integrated Shield plans as examples.
Addressing concerns about existing policyholders and employees, the Minister said approval of the deal would not change the terms and conditions of existing insurance policies.
Regulators expect Income to meet its obligations, and Allianz has publicly committed to respecting existing policies.
MAS has regulations in place to ensure it has adequate capital reserves, strong governance and fair treatment of customers.
Participating policyholders are protected by limitations on the distribution of profits to shareholders.
With regard to employees, MAS does not regulate employment decisions but expects fair treatment and compliance with employment law.
Minister Chee concluded:
“MAS encourages all insurers, both domestic and international, to continuously innovate, adopt best practices and ensure robust risk management.
This will foster competitive insurance markets that provide choice, value and stability to protect policyholders’ interests.”
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