At least 15 firms seeking to run new London gold benchmark-sources

Thu Sep 18, 2014 11:27am EDT
 
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* Deadline for proposals set for October

* LBMA to hold seminar to present shortlisted proposals

* Search for new chairperson scrapped

By Clara Denina

LONDON, Sept 18 (Reuters) - At least 15 companies have expressed interest in replacing the century-old London gold benchmark, with a new system seen in place by the end of 2014 as banks effectively call time on the current process, two sources familiar with the matter said.

Representatives from a handful of banks have been running the gold "fix" since 1919. The twice-daily price they agree is used by producers, consumers and investors to trade the metal and value their holdings.

The London Bullion Market Association (LBMA) and the four banks currently administering the price-setting mechanism by conferring in London by telephone had said earlier this month that their choice for a new operator would be announced in October, but the process is likely to take longer.

Bank of Nova Scotia, HSBC, Societe Generale and Barclays currently set the benchmark. Deutsche Bank withdrew in May after two decades.

The LBMA launched a consultation with market participants this month, including central banks and miners, to assess how they want prices to be derived. It will hold a seminar in October for shortlisted proposals.   Continued...