Singapore to woo central banks with gold custody services from October

Singapore is set to offer gold storage services to foreign central banks and sovereign entities starting this October, a strategic move designed to cement its position as a premier regional hub for gold trading and custody. The initiative was announced by Deputy Prime Minister Gan Kim Yong at a forum on Monday.

Gan, who also serves as Minister for Trade and Industry, noted that the new service will complement the city-state's existing commercial vaulting capacity, which already exceeds 2,000 tonnes and serves clients such as bullion banks, institutional investors, and high-net-worth individuals. To facilitate the active management of these gold holdings, the Monetary Authority of Singapore will provide gold accounts to a select group of Singapore-based bullion banks, enhancing their ability to offer gold-related services and liquidity. "This strengthens Singapore’s proposition as a jurisdiction where reserve assets can be securely held, actively managed and connected to wider market liquidity during Asian trading hours," Gan said.

The move is seen as giving Singapore a competitive advantage. David Tait, CEO of the World Gold Council, told The Business Times, "Singapore probably has an edge (over Hong Kong) because it’s ... offering itself to the central banks of the world for custody, which I think is going to be pivotal." He added, "If central banks are willing to deposit their (gold) reserves here, it adds a degree of confidence in the overall running of the market and everything."

Gan also detailed further measures to bolster Singapore’s role in the global gold market. The Singapore Exchange is slated to establish an over-the-counter gold clearing system by the end of 2026, with interbank trading anticipated to expand from 2027. "By streamlining trade processing, enhancing transparency and supporting more efficient clearing and settlement, it will give market participants greater confidence to transact in Singapore," Gan stated. He confirmed the system "will support both large bars and kilobars, enabling standardized settlement during Asian trading hours."

Large bars are defined as the 400-troy-ounce (approximately 12.4 kg) standard used for institutional settlement in London, while kilobars are the 1-kilogram standard preferred in Asian markets and accepted for delivery in U.S. Comex gold futures contracts. Six major banks—DBS, Deutsche Bank, ICBC Standard Bank, JPMorgan, OCBC, and UOB—have been named as founding clearing members and will assist in developing Singapore’s gold market.