INSURER AIA Singapore laid off about 20 employees from two of its divisions on Thursday as part of its efforts to trim fat.
The affected employees included chief marketing officer Lance Tay, who oversaw the Life Profit Centre (LPC), and Mr Stanz Tan, the head of LPC and AIA's vice-president.
Sources said that Thursday's cuts are unlikely to be the last among the 800-strong workforce. It is believed that there will be more job losses, either through retrenchment, re-deployment, outsourcing or natural attrition. There are no plans to reduce its life agency strength.
The axings come just six weeks after AIA's US parent AIG almost collapsed under the weight of massive liabilities.
It was bailed out by the US taxpayer to the tune of almost US$123 billion (S$182 billion) but the uncertainty affected operations here and sparked two days of panic with policyholders besieging the Singapore office demanding their money back.
The crisis raised the spectre of cost-cutting among some staff here. One told The Straits Times yesterday: 'There are so many changes here. But when you work in a corporate, these things do happen and we just have to move on.'
But a senior employee said the firings were not unexpected as he had been forewarned by bosses three months ago that there would be some manpower cuts.
'It's part of downsizing and cutting costs. It's good for AIA,' he said. 'There has been so much fat accumulated in the last few years. Sometimes, a new team is hired just because there is a new project, so some functions are duplicated.'
AIA said the job cuts affected fewer than 20 staff and the exercise was a result of a review of ongoing business strategy. The aim is to transform itself into a 'more nimble, efficient and growth-oriented company for the long term'.
'We are laying the building blocks for a more exciting future that will benefit generations of customers, agents, distribution partners and employees,' it said.
The moves mean the LPC and Accident & Health (A&H) units have ceased to exist. Their functions are expected to be taken over by the Life division.
The LPC used to support AIA's 4,000 life agents by launching new products and preparing marketing materials.
AIA's cost-cutting began well before the crisis that hit AIG. In the past months, some departments have been outsourced and the affected staff re-deployed or hired by the outsourced contractors.
The cheque-processing unit was outsourced six months ago while the property maintenance division and mailing room were both outsourced two months ago, said a source.
He added that AIA's call centre, which employs about 40 Filipino contract workers here, is likely to be next in the outsourcing pipeline.
Thursday's layoffs have also closed a chapter for Mr Tay, an industry veteran. He was an agency superintendent at AIA about 20 years ago but left to join another firm. Before returning to the AIA fold in 2004, he was deputy chief executive at US-based insurer John Hancock in Singapore.
On a broader front, AIG in the United States must repay the US$123 billion in government loans and speculation has been rife over which assets it would dispose to raise funds.
It announced early last month that it would retain its US property and foreign general insurance businesses but would seek 'minority strategic investors' to take slices of its foreign life insurance operations, including those in Singapore and other Asian centres.
