- What You Don’t Know! Scotiabank is About to Completely Withdraw from the LBMA
by Sam Briggs, Kinesis, via https://www.silverdoctors.com/
Upon exiting the market, Scotiabank will be made to square up all gold and silver paper market positions, but questions linger whether they have the…
Word from behind closed doors at the Scotiabank, reveals the key market maker is set to withdraw completely from the London Bullion Market Association (LBMA), and close its doors permanently by the end of the year.
The major Canadian financial institution had previously announced a winding down of some bullion banking provision, assuring the industry that the bank’s role as a key market maker would remain unaffected. Scotiabank’s u-turn and sharp exit from the bullion banking space could have far-reaching implications across the gold and silver markets.
Suspicions of Scotiabank’s hushed departure first arose when associate LMBA member, Bullion Management Group, BMG, declared the financial institution would no longer act as their custodian. The Canadian bank’s unexplained withdrawal from the risk-free and profitable income of custodianship sounded the first alarm among industry experts.
What are the reasons behind Scotiabank’s closure?
Termination notices sent out to Scotiabank employees first detailed the bank’s impending closure, the cause of which still remains unclear. According to industry experts, the imminent shutdown bears all the hallmarks of a forced regulatory decision, leading on from the market rigging lawsuit filed against the bank in March. The US court filing showed that Scotiabank provided 800,000 pages of evidence for regulators probing the metals trading of investment bank, JPMorgan.
Does Scotiabank have the physical bullion to back its paper positions?