DIV deal guarantees security for deposits

Prime Minister Nguyen Tan Dung has signed a decision to set up the Deposit Insurance of Viet Nam (DIV) in a bid to provide security to depositors.

The decision will see the implementation of a deposit insurance policy to ensure the stability of Viet Nam's credit system and development of the banking sector.

DIV, a state non-profit financial institution, will have a charter capital of VND5 trillion (US$238 million) funded by the State Budget. DIV's activities will also be tax-exempt under the provisions.

DIV will provide development strategy for deposit insurance and provide submissions to the central bank and the Prime Minister for approval.

The company will also participate in management and disposal of assets and the recovery of insurance payable by institutions.

The PM also approved the charter and operation of DIV, which provides the chairman of the board of directors will act as the company's legal representative.

The board will have up to seven members, including a chairman appointed by the PM. Remaining members will be appointed by the Governor of the State Bank of Viet Nam.

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