By Chris Wright
Forbes
This week reports emerged that South Africa’s Standard Bank was in negotiations to take Deutsche Bank’s seat at something known as the London fix: the group of banks who chair the price-setting mechanism for the global gold benchmark.
On first glance it looked interesting and perhaps practical that South Africa, as a leading gold producer, should seek a seat at this particular table. But that is to miss the point. What is much more interesting is that Standard Bank is 20% owned by China’s Industrial and Commercial Bank of China (ICBC) — which is also in the process of buying a majority stake in Standard’s UK-based markets business, including commodities.
To understand the significance of this step, let’s take a look at the various elements of the story.