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Bank, depository centre to support ETFs

Update: September, 26/2012 - 10:25

HA NOI  (VNS)— Standard Chartered Bank will support the Viet Nam Securities Depository Centre in providing transfer services to open-ended funds under a memorandum of understanding signed on Monday. The services will include managing investor accounts and establishing ownership of fund certificates.

Standard Chartered has agreed to support the depository centre in technical systems consistent with international practices and to establish technical infrastructure for these services, said centre director Phuong Hoang Lan Huong.

"This is a foundation for diversifying the nascent Vietnamese fund management sector," Huong added.

According to Standard Chartered CEO Louis Taylor, the co-operation would facilitate long-term capital inflows for the development of Viet Nam's economy.

Considerable investor interest has swirled around the development of exchange-traded funds (ETFs) since the State Securities Commission issued a draft circular to govern their operation, said the head of the commission's fund management division Nguyen Thanh Long

"There are now favourable conditions for the introduction of these funds, including the effective operation of the VN30 and HNX30 indices," Long said. "If open funds are soon established, they will likely be able to contribute to reducing bad debt levels and cross-ownership within the banking system."

Domestic funds would also be able to improve their effectiveness through competition with foreign rivals, and the operation of ETFs would help attract more foreign investment to the stock market, he added. — VNS

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