The roster of banks that help set the global benchmark gold price is expanding further with the addition of another Chinese bank to the process, the Intercontinental Exchange (ICE) said in a statement on Monday.
The Industrial and Commercial Bank of China (ICBC) has been approved by ICE Benchmark Administration (IBA) to participate in the auction that is used to determine the new global benchmark, LBMA Gold Price. The ICBC, which is the third Chinese bank to join the price setting process, will join on May 16.
IBA reports that, with the addition of the ICBC, the number of direct participants in the benchmark setting process will reach 13; up from just four firms when it took over the benchmark in March 2015. It has also adopted a number of new measures to enhance the auction, including enhanced governance, independent oversight, and improved surveillance including daily transparency reports.
These measures stem from global efforts to improve the quality and integrity of financial benchmarks generally in the wake of the LIBOR market manipulation scandal.
“The continued growth and interest of firms to become direct participants demonstrates the global significance of the LBMA Gold Price benchmark and the importance of the auction as the key point of liquidity for physical spot gold,” says Finbarr Hutcheson, president of IBA, in a statement.