China's ICBC has big dreams for bullion business
By Fayen Wong
SHANGHAI May 28 (Reuters) - Industrial and Commercial Bank of China Ltd is seeking membership of overseas exchanges and aims to become a major global bullion market maker, a senior executive said on Monday.
The world's biggest bank by market value, ICBC is the top player by volume on China's gold and futures exchanges, but its participation in foreign markets is limited to over-the-counter trading, which reached a total $90 billion last year.
Emboldened by Beijing's ambitions to have a bigger say in global commodity prices, ICBC now has an eye on bourses such as COMEX and on joining the 11 market makers of the London Bullion Market Association (LBMA).
These quote continuous two-way bid and offer prices for gold, silver, platinum and palladium throughout the London day, providing a liquid market in which to trade.
"We hope to play a bigger role in the global precious metals market and become a major market maker, like Barclays," Shen Shisheng, ICBC vice-general manager of financial markets, told Reuters on the sidelines of a conference in Shanghai.
Barclays Capital is among the gold fixing members on the LBMA.
The newest LBMA market maker, Merrill Lynch, was appointed in January last year. ICBC became an ordinary member of the LBMA late last year, the first commercial bank in China to join the association.
Given the bank's large trading volume, Shen said that ICBC has recently started price quotation for gold transactions on the Shanghai Gold Exchange and has begun acting as an agent for non-member clients. Continued...