Congress gave new powers Monetary Authority of Singapore (MAS) Blocking transactions involving insurance companies tied to cooperatives.
The move comes as Allianz Europe seeks to become Income Insurance’s largest shareholder, with concerns raised about the structure of the deal and its potential impact on Income Insurance’s social mission.
Insurance (Amendment) Bill; passed The law of 16 October 2024 will enable the MAS to seek input from the Ministry of Culture, Communities and Youth (MCCY) before approving transactions involving insurance companies associated with cooperatives .
The bill was introduced after Allianz’s attempt. Acquired 51% stake in Income Insurance for S$2.2 billionfollowing the corporatization of Income in 2022.
The government has raised concerns about the structure of the deal, particularly the potential return of S$1.85 billion in capital to shareholders, and how Income’s S$2 billion surplus inherited from incorporation will be used. A question arose about this.
This uncertainty has raised concerns about whether the deal will be able to uphold Income’s social mission commitments when it transitions from a co-operative.
Transport Minister and Second Minister of Finance Chee Hong Tat introduced the bill on behalf of Deputy Prime Minister Gan Kim Yong.
The government did not challenge Allianz’s eligibility, but stressed the need to protect the social purpose of co-operative insurers like Income.
Under the new law, MAS will need to obtain ministerial approval before proceeding with such a transaction.
This aims to ensure that broader public interest concerns are addressed and protect the social mission of cooperative insurers.
The bill also removes the right to appeal MAS decisions pending approval, given the urgency of the Allianz-Income transaction, which Income shareholders are still actively considering. , which will speed up decision-making.
Both NTUC Enterprises and Allianz, which own Income, expressed respect for the government’s position.
allianz shown It said it would work with stakeholders to consider the next steps for the transaction.
