Even as China yesterday approved the listing of gold ETF's domestically, investors are increasingly interested in owning physical gold directly. Deutsche Bank has just opened a vault in Singapore, where JP Morgan and the the Singapore Mercantile Exchange have one, and Morgan is reopening its New York vault and Baclays's is opening a new one in London. (see article below.) Gold is moving from the more speculative ETFs to longer term holders.
Lincoln
From the FT:
"Deutsche opens Singapore gold vault for wealthy investors
By Josh Noble in Hong Kong
"Deutsche Bank has become the latest bank to tap the growing appetite for precious metals vaults, opening a safe deposit in Singapore capable of holding up to 200 tonnes of gold to meet storage demand in Asia.
"The opening of the vault comes as banks seek to tap into rising demand from wealthy investors for direct access to physical bullion rather than holding exchange traded funds, futures and options on the metal.
"Over the past two years, JPMorgan has reopened an old vault in Manhattan and built a facility in Singapore. Barclays, meanwhile, opened a precious metals vault in London late last year.
"Mark Smallwood, Deutsche’s head of wealth management in Asia, said investors globally were now paying closer attention to where their gold was stored, and that the new facility would help meet the changing demands of Asian investors.
'“Until now, our private clients have traded and invested in significant amounts of gold through the London spot market and exchange traded funds,” said Mr Smallwood. “There is a growing recognition among investors that they might want to have at least part of their allocation in physical bars.”
"
"Deutsche’s decision to locate its new vault in Singapore is a boost for the city-state’s efforts to become the regional centre for gold trading. Last year Singapore removed sales tax on gold investment in an effort to boost its role in the market.
"Many Asian investors have used the recent falls in the spot price to load up on the precious metal. Fevered retail buying in April left many banks, jewellers and even the Hong Kong gold exchange without enough stock to meet demand.
"Deutsche Bank expected to see strong demand from wealthy clients looking to use physical gold as collateral for other trading activity, added Mr Small-wood.
'“Asian clients like to make all their assets work very hard for them. Even though they may be holding gold for a potential catastrophic event, they recognise that it might not happen tomorrow,” Mr Small-wood said.
"The new facility will be located in the Singapore Freeport, already home to storage facilities run by auction house Christie’s and wine investment manager Stamford Cellars.
"Other banks, such as JPMorgan, already have gold vaults in Singapore, which are largely focused on institutional clients. . . "
.
"The opening of the vault comes as banks seek to tap into rising demand from wealthy investors for direct access to physical bullion rather than holding exchange traded funds, futures and options on the metal.
"Over the past two years, JPMorgan has reopened an old vault in Manhattan and built a facility in Singapore. Barclays, meanwhile, opened a precious metals vault in London late last year.
"Mark Smallwood, Deutsche’s head of wealth management in Asia, said investors globally were now paying closer attention to where their gold was stored, and that the new facility would help meet the changing demands of Asian investors.
'“Until now, our private clients have traded and invested in significant amounts of gold through the London spot market and exchange traded funds,” said Mr Smallwood. “There is a growing recognition among investors that they might want to have at least part of their allocation in physical bars.”
"
"Deutsche’s decision to locate its new vault in Singapore is a boost for the city-state’s efforts to become the regional centre for gold trading. Last year Singapore removed sales tax on gold investment in an effort to boost its role in the market.
"Many Asian investors have used the recent falls in the spot price to load up on the precious metal. Fevered retail buying in April left many banks, jewellers and even the Hong Kong gold exchange without enough stock to meet demand.
"Deutsche Bank expected to see strong demand from wealthy clients looking to use physical gold as collateral for other trading activity, added Mr Small-wood.
'“Asian clients like to make all their assets work very hard for them. Even though they may be holding gold for a potential catastrophic event, they recognise that it might not happen tomorrow,” Mr Small-wood said.
"The new facility will be located in the Singapore Freeport, already home to storage facilities run by auction house Christie’s and wine investment manager Stamford Cellars.
"Other banks, such as JPMorgan, already have gold vaults in Singapore, which are largely focused on institutional clients. . . "
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