News Column

Gold Held by China's Banking Up 55%

September 3, 2014

BEIJIN, September 3, SinoCast -- Total value of precious metals held by China's big four banks, ICBC, China Construction Bank, Agricultural Bank of China and Bank of China, totaled CNY 378 billion by the end of the second quarter of this year, with a growth higher than the international benchmark gold price growth of 7.5%.

According to the World Gold Council, calculated based on CNY 261.86 per gram at Shanghai Gold Exchange on June 30, the gold held by China's banking sector is equivalent to 1,445 tons, growing 55% year on year and higher than gold reserves of 1,054 tons held by China's central bank.

As the real estate market becomes weak and bad debts increase, China's banking sector is controlling credit risks through improving borrowing costs and limiting loans to high-risk industries, so banks began to increase the holding of precious metals to expand the gold leasing business. For this business, there is not upper limit for financing.

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Source: Sinocast Banking & Credit Beat (China)

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