Scotiabank Keeping Its ScotiaMocatta Bullion Desk
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(Kitco News)- It appears that the Bank of Nova Scotia has been unable to seal a deal to sell its precious metals trading business as it announced that it plans to keep a slimmed-down version of its ScotiaMocatta bullion division.
"Most of our key services and our key markets and key clients will be continuing," said Dieter Jentsch, group head of global banking and markets at Scotiabank. "We will be exiting some markets, we will be simplifying our product suite, and we'll be much more judicious about our allocation of capital and liquidity."
The announcement was made Tuesday, as the Canadian bank reported better-than-expected earnings for the fourth quarter.
The bank's latest announcement ends years-long speculation surrounding the fate of one of the world's oldest bullion trading banks. Scotiabank hired JPMorgan in 2016 to help with a potential sale.
According to market reports, at one point four banks showed interest in the bank's bullion business: Japanese trading house Sumitomo, Australian bank ANZ, Goldman Sachs Group and Citi. Only last month Goldman Sachs and Citi group were seen as the two major contenders and were reported to be undertaking due diligence checks.
According to some analysts, the potential sale of Scotiabank's bullion desk was overshadowed by ongoing lawsuits bullion banks are facing. ScotiaMocatta was a member of the century-old London Gold Fix, and now faces lawsuits, alleging that the group manipulated gold and silver prices during the auction process.
By Kitco NewsFor Kitco News
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