And I did have a few professors which considered it a problem if more than half of their class passed the first time they took the exam.
They have to fail a number of students so that his class size maintains the numbers to avoid unwanted attention from the administration.
If let's say the normal class size was about 20, but you only get about 15 new students each semester, so you fail 5 of them (or more accounting for dropouts) to make up the numbers.
today, the only analog to such a selection criteria in Singapore would be combat pilot selection. Every year probably a few thousand apply, about 200 manage to pass medicals, aptitudes etc, to go basic wings and only about 15-20 make the final cut.
That doesn’t happen in academia today though. A certificate doesn’t guarantee you a job, fewer tenure positions available, school fees rising, less govt support, administration getting more powerful due to corporatization etc. The certificate is seen as default end product, not a trophy for the top performers.