SINGAPORE (Reuters) - Deutsche Bank plans to open a new precious metals vault in London next year, seeking to cash in on booming investor demand for physical gold and silver, the Financial Times reported on Tuesday.
In London, centre of the global bullion market, vault space is running low even as the growth in exchange-traded funds backed by physical precious metals has led to a steep rise in demand for vaults.
A growing number of banks and logistics companies are rushing to break into the market. Clients are looking to diversify where they place their physical holdings of precious metals, the paper quoted Raymond Key, Deutsche’s global head of metals trading, as saying.
The new vault will be built and managed by G4S, the logistics company, the paper reported, citing Deutsche Bank.
While the bank only confirmed that the new facility would be UK-based, industry executives said it would certainly be in London or the vicinity, according to the report.
Barclays Capital said last year it will open a precious metals vault in London this summer, while JPMorgan reopened its old one in New York and built a new one in Singapore, another indicator of the rising demand for vault space, the paper said.
U.S. logistics firm Brink’s Co (BCO.N), which opened a vault last year, is also considering adding another facility, the paper said, citing a report by the London Bullion Market Association last year.
Reporting by Rujun Shen; Editing by Ramya Venugopal