BANDAR SERI BEGAWAN (Brunei) - BRUNEI said on Wednesday it would join other Asian countries to guarantee all bank deposits for the next two years, and urged financial institutions to manage risks more responsibly amid the global economic crisis.

The Ministry of Finance said banks and other financial institutions in this oil-rich sultanate on Borneo island remained stable and retained public confidence because they were 'well capitalised, strongly regulated and supervised on a continuous basis'.

Nevertheless, the ministry said the government will fully guarantee all Brunei dollars and foreign currency deposits in banks and financial companies until December 2010 in line with similar moves by authorities elsewhere in the region.

Australia, Hong Kong, Indonesia, Malaysia, New Zealand and Singapore were among countries that announced measures recently to guarantee bank deposits.

Brunei 'needs to take similar pre-emptive and precautionary measures to ensure a level international playing field for its financial institutions', the ministry said in a statement issued through domestic media.

The ministry stressed that institutions should 'conduct their business responsibly, prudently and with due care, especially in respect to assuming and managing risk'.

Officials will introduce measures to strengthen the regulatory system and closely monitor institutions to ensure the protection of deposits will not be abused, it added.

Analysts say the guarantees in Asia are meant to pre-empt the possibility of rumor-sparked bank runs, rather than a sign of fundamental weakness in the region's banks, which are largely better capitalised and have less debt than their US and European counterparts. -- AP