Seah Kian Peng needs to comment on impending sale of Income as former NTUC Enterprise CEO

The impending sale of Income Insurance to the German multinational Allianz has stirred significant controversy and public concern.

Allianz announced on 17 July its intention to purchase 51% of Income Insurance’s shares, offering S$40.58 (US$30.20) per share, with a transaction value of S$2.2 billion.

NTUC Enterprise, currently holding a 72.8% stake in Income Insurance, will remain a substantial shareholder—but a minority—if the sale proceeds.

Voices of Concern

This move has sparked backlash, with critics fearing it may compromise Income’s commitment to Singapore’s workers. Notable Singaporean figures have expressed their reservations about the planned sale of NTUC Income to German insurer Allianz, arguing that the core values of NTUC Income and Fairprice should remain intact.

Mr Tan Suee Chieh, who served as NTUC Income CEO from 2007 to 2013, criticized the sale, emphasizing that it contradicts the commitments made to shareholders during the corporatisation of Income Insurance in 2022.

He highlighted the broken promise that NTUC Enterprise would remain the majority shareholder and called for a fairer distribution of equity gains for shareholders who invested before NTUC Enterprise’s capital injection.

Shareholders were told at the May 2022 Annual General Meeting that “post-corporatisation, NTUC Enterprise will continue to be the majority shareholder of the new company.”

In a Facebook post last week, Mr Tan Suee Chieh quoted Allianz Group CEO Oliver Bäte, who stated in a Business Times article, “We’re not in Asia to buy top line; we want to build a resoundingly profitable business.”

He contrasted this with the values of NTUC Income under his and Mr Tan Kin Lian’s leadership, stating, “We maximised value to policyholders, but they must be sustainable and make business sense. We wanted to have as much reach to Singaporeans, not to maximise profits but to maximise social impact.”

Mr Tan Suee Chieh urged Singaporeans to speak up, saying, “I hope our leaders are making sound decisions to benefit Singaporeans in the long term. I hope things may still change if there is a public outcry. So speak up now or forever hold your peace.”

Commenting on Mr Tan Suee Chieh’s post, former GIC economist, Yeoh Lam Keong wrote, “To sell off controlling interest to Allianz, a profit maximizing international financial firm after achieving such a strong and sustainable financial and market position after decades of competent local trade union and government linked ownership is in my humble opinion a strategic policy error that needs serious reconsideration.”

In a Facebook post last Tuesday, Dr Tommy Koh, Ambassador-At-Large at the Ministry of Foreign Affairs and Chairman of the Institute of Policy Studies, voiced his opposition to the proposed sale.

Dr Koh highlighted the origins of NTUC Income, stating, “INCOME started life as a cooperative of NTUC like Fairprice. The idea was to offer insurance to the people at affordable rates. A few years ago, it was made into a company and ceased to be a cooperative. Now we are told that it may be sold to a German insurance company.”

He further emphasized the social mission of NTUC Income, saying, “I don’t think it’s a good idea to sell INCOME. It was founded to serve a social purpose and a social need. They remain valid today. I wish to argue that INCOME and Fairprice should never be sold.”

NTUC Income, established in 1970, was created to provide insurance protection to the masses at a time when life insurance was primarily accessible only to the higher income group.

In January 2022, NTUC Income announced plans to convert its legal structure from a co-operative to a company governed by the Companies Act, aiming to strengthen its position amidst growing industry competition.

The corporatisation was intended to provide NTUC Income with greater flexibility to raise funds for expansion and to offer more competitive products. The corporatisation was completed on 1 September 2022.

Missing from the Picture: Seah Kian Peng

Amidst the controversy and vocal criticisms, missing from the picture is Mr Seah Kian Peng, a People’s Action Party (PAP) Member of Parliament for Marine Parade GRC, served as the CEO of NTUC Fairprice from 2010 to 2022 and was the group chief executive officer of NTUC Enterprise until August 2023.

He stepped down from his role at NTUC Enterprise in August 2023 to take up the position of Speaker of Parliament following the resignation of former Speaker Tan Chuan-Jin after his extramarital affair with a fellow PAP MP came to light.

His silence on the matter is particularly conspicuous, given Mr Seah held the role of CEO at NTUC Enterprise during the corporatisation of NTUC Income in 2022, where assurances were made to shareholders about maintaining NTUC Enterprise’s majority shareholding in Income Insurance.

Seah’s predecessor, Mr Tan Suee Chieh, has come out to voice his disagreement with the sale. So, what about Seah?

Even though Mr Seah left his appointment last year, his silence on the matter thus far leaves a significant gap in accountability. As someone who was at the helm during the time these commitments were made, his perspective and explanation are essential.

Addressing the controversy is not only a matter of upholding the promises made to shareholders but also reinforcing principles of good corporate governance and public trust. As a politician, Mr Seah’s responsibility to the public is heightened.

The public deserves to understand the rationale behind Mr Seah’s considerations of allowing NTUC Income to corporatise and how they align with the commitments made to stakeholders.