ICBC to Purchase Barclays Precious Metal Vault Storage in London
ICBC Standard Bank, which is a subsidiary of Industrial and Commercial Bank of China agreed to purchase Barclays PLC’s precious metal vault storage business in London. Once the acquisition is complete, ICBC China the largest commercial lender by assets will be the first Chinese bank to have a vault in London which is one of the largest precious metal vaults in Europe that can contain around 2,000 tons of gold and other precious metals such as platinum, silver and palladium.
Owning a precious metal vault, ICBC Standard Bank is now capable of providing precious metal clearing service and offers customized services ranging from supply to inspection of precious metals. This will enable the bank to better execute their strategy of becoming one of the largest Chinese banks in the precious metal market. Acquiring the precious metal vault allows the banks to expand services in clearing and processing. ICBC will have the ability to provide a one stop precious metal services across the entire process that includes clearing, pricing, fixing, market making, vaulting and risk management. The bank will be able to carry out both retail and wholesale business on precious metals no matter if its paper or physical. Earlier, ICBC Standard Bank was given the approval to join a precious metal clearing system that is operated by London Precious Metals Clearing Ltd. and became the first Chinese bank to provide clearing services.
ICBC is the first banking group that is admitted to London Precious Metal Clearing since 2005, joining other five members Barclays, JPMorgan Chase and Co., HSBC Holdings PLC, the Bank of Nova Scotia and UBS AG. The admittance gave China a louder voice and improves its international status in the international precious metal market.
Aside from the clearing service, ICBC Standard Bank has the opportunity in playing an important part in providing precious metal commodity leasing and financing intermediary services. Since the start of the precious metal business in 2009, ICBC recorded around 730,000 tons of metal trading volumes with values exceeding 7 trillion yuan in transactions. The bank created a global investment management platform for precious metals and commodities that steadily push forward the business in core international financial market.