ICBC Standard Bank is buying Barclays’ London precious metals vault, giving the Chinese bank the capacity to store gold worth more than US$80bn in the secret location.
The vault is one of the largest in Europe, with a capacity to hold 2,000 tonnes of gold, silver, platinum and palladium. It has been operational since 2012.
ICBC Standard Bank said on Monday it has signed an agreement to buy the vaulting business and transfer the associated contracts, subject to consent. The deal is expected to complete in July.
ICBC Standard Bank specialises in commodities, fixed income, currencies and equities and was formed in February 2015 when Industrial and Commercial Bank of China bought a 60% stake in Standard Bank’s London-based global markets business.
Barclays’ modern vault holds precious metals for pension funds, central banks, sovereign wealth funds and other investors. Most ‘over-the-counter’ gold and silver trading is cleared through the London market, and clearing banks provide services for clients to settle their gold and silver trades, and ultimately have to have access to reserves of physical metal.
ICBC Standard Bank will become the first Chinese bank to operate its own vault in the UK, joining a small group to have the facility.
Mark Buncombe, ICBC Standard Bank’s head of commodities, said the deal is part of its plan to become one of the largest Chinese banks in the precious metals market.
Full article: China’s ICBC buys Barclays’ London gold vault (TruNews)