Banks & WGC Seeking Proposals To Standardize Gold Clearings
$GS, $MS, $C, $ICE, $CME, $GLD
A group of 5 banks, including Goldman Sachs Group Inc. (NYSE:GS) and Morgan Stanley (NYSE:MS), have asked exchanges for proposals on how to start standardized central clearing and listed derivatives for the London Gold market.
The request was sent last week to the London Metal Exchange (LME).
It was also sent to the London Stock Exchange, Intercontinental Exchange Inc. (NYSE:ICE) and CME Group Inc.(NASDAQ:CME).
The letter was sent by the banks, which also include Societe Generale SA, ICBC Standard Bank Plc and Citigroup Inc.(NYSE:C), and the London-based World Gold Council (WGC).
The WGC said in a letter last month to London’s precious metals associations that it and the banks are talking about making changes to improve the market. London uses OTC (over-the-counter) trading, rather than having set contracts on an exchange, such as the COMEX in New York. Separately, the London Bullion Market Association earlier this month invited proposals on how to improve the market and suggested more detailed reporting of trades.
The LME declined to comment.
CME Group, ICE and the LSE and the banks did not immediately reply to phone messages or e-mails.
The producer-funded Gold council said that it continues to talk with banks and the wider industry to explore ways to modernize the market, without elaborating.
Proposals are expected back by the end of the month.
Have a terrific week.
HeffX-LTN
Paul Ebeling
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