Six Firms to Participate in Friday's Electronic Gold Fix, Says ICE

By Matthew Cowley

LONDON--Six banks will participate in the auction to set the new electronic gold price that will launch on Friday, according to Intercontinental Exchange Inc., which manages the new platform.

Four of the banks--Barclays PLC (BCS), HSBC Holdings PLC (HSBC), Bank of Nova Scotia (BNS) and Societe Generale S.A. (GLE.FR)--participate in the existing conference call that is used to determine the daily fixes. The newcomer unveiled by ICE on Thursday is Swiss bank UBS AG (UBSN.EG); the sixth name wasn't disclosed.

ICE will manage the gold price on behalf of the London Bullion Market Association, which will hold the intellectual property rights to the fixes. The LBMA Gold Price will be will be set twice daily--at 1030 GMT and 1500 GMT--in dollars, euros and sterling.

The U.S. Mint said on Thursday it would use the LBMA gold price to price and settle all of its gold bullion orders, effective Monday.

On Thursday, the gold fix was set for the last time by private telephone conference call between the group of four banks--the system has been in place since 1919.

The gold market has a daily turnover of around $150 billion, making it the largest precious metals market. The silver price made the move to an electronic platform in August last year, with a system that is jointly managed by CME Group Inc. (CME) and Thomson Reuters Corp. (TRI).

Platinum and palladium prices went electronic in December. Their platform is managed by the London Metal Exchange--owned by Hong Kong Exchanges & Clearing Ltd. (0388.HK).

Write to Matthew Cowley at [e-mail]

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