Bank of China is approved to launch individual gold trading
The Bank of China (BOC) officially announced it has received full approval from the China Banking Regulatory Commission (CBRC) to launch individual gold trading. The BOC was also granted permission to start spot gold trading for individual clients, an official surnamed Miao with the press department of the BOC confirmed to Interfax. The bank is one of the four leading state-owned commercial banks in China.
In contrast to the China Merchants Bank (CMB), which has China's largest individual gold trading network, the BOC does not sell gold bars but Olympic themed gold products.
According to the announcement of the BOC, as a sponsor for Beijing 2008 Olympic Game, the BOC will sell gold products with the theme of the Olympic Games, "to promote the Olympic spirit to the Chinese people" and provide an opportunity for customers to collect and invest in gold products, which could be regarded as type of gold trading. Clients can also sell those gold products back to the BOC to make profits. However, the announcement did not explain procedures for spot gold trading.
The BOC has actually already started trial operation of individual gold trading in its Shanghai Branch at the end of 2003, using the "Huang Jin Bao" system, meaning Gold Passbook. However, "Huang Jin Bao" is a type of virtual gold trading without real gold involved, operating on a passbook system where purchases and sales of gold are recorded in a ledger but no actual gold changes hands. Each transaction must be at least 10 grams of gold.
When asked whether the BOC was cooperating with any gold producer to supply the individual market, Miao declined to disclose any information. The China Merchants Bank (CMB) works with Gaosai'er Gold & Silver Co., Ltd (Gaosai'er) to sell Gaosai'er gold bars. "Gaosai'er has no intention in collaborating with the BOC to sell gold bars right now, " an official with the PR department of Gaosai'er declared to Interfax.
However, he revealed that the BOC would introduce "Huang Jin Bao" trading format, not the Olympic gold products as its main trading form around the country, as the Shanghai Branch of the BOC had used the "Huang Jin Bao" system for almost a year.
Actually, the BOC will continue to authorize other branches to launch "Huang Jin Bao" style trading in the following months, including Beijing in January 2005, according to information from the Ministry of Commerce (MOFCOM).
Although the CMB has a larger network, the BOC was actually the first bank be authorized by the CBRC to conduct individual trading. "The BOC was the only bank to be granted gold trading (to companies) before 2001. After the BOC, other banks including Industrial and Commercial Bank of China (ICBC) were permitted," Miao said.
interfax.com |
