Monday, May 16, 2016

China preparing takeover of physical gold markets through purchases of London gold vaults

A few years ago, China acquired the largest gold vault outside of Fort Knox when they purchased J.P. Morgan's former headquarters directly across from the New York Federal Reserve building.  And with that purchase came the underground vault and tunnel that was shared between the two banks.

And now in 2016, China is preparing for the eventual takeover of the Western physical gold markets through purchases of two new vaults, which are located in the City of London.

We thought that ICBC would be content with its purchase of one of London's biggest vaults but that appears to not have been the case. Earlier today, ICBC Standard Bank reported that it was also 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, which can store 2,000 tons of gold and other precious metals such as silver, platinum, palladium, was opened by Barclays in 2012 and took more than a year to build. The location of the vault is secret, but the lender has said it’s within the M25 road that orbits London. 
"This is an exciting acquisition for the Bank. This enables us to better execute on our strategy to become one of the largest Chinese banks in the precious metals market,” Mark Buncombe, head of commodities at ICBC Standard Bank, said in the statement. "The acquisition of a precious metals vault allows us to expand our services in clearing and processing." 
Barclays' decision to exit the business comes as U.S. and European Union regulators investigate whether at least 10 banks, including Barclays, JPMorgan Chase & Co. and Deutsche Bank AG -- manipulated prices of precious metals such as silver and gold. - Zerohedge


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