To avoid the risk of price fluctuation, more than 10 banks suspend the opening of precious metal trading

 To avoid the risk of price fluctuation, more than 10 banks suspend the opening of precious metal trading

Lou Feipeng, a researcher at the postal savings bank, told the Securities Daily that in the long run, the price of precious metals is on the rise as a whole. However, the price fluctuation of precious metal market is not a normal phenomenon. After the market price trend is relatively stable, banks can restart new account opening.

Risk of precious metal trading business

In recent years, the price fluctuation of international precious metal market has increased, and the risk of precious metal business for individual customers has increased. On the afternoon of November 27, several banks including industry, agriculture, construction, communications, China Merchants, Ping An and other banks successively issued announcements, saying that since November 28, the account of precious metal trading and other business customers signing up to open accounts will not be affected.

The precious metal trading business of the bank mainly includes account precious metal and personal precious metal trading business acting for Shanghai gold exchange. Account precious metals are also known as paper gold and paper silver, while the other is trading on behalf of Shanghai Gold Exchange precious metal spot and precious metal spot extension (i.e. precious metal T + D).

After combing the announcements of several banks, Securities Daily found that the reasons for the suspension of new account opening were the increase of price fluctuation in the international precious metal market and the rising risk of precious metal business for individual customers. There are also a number of banks in the announcement that the normal transactions of customers who have opened accounts will not be affected.

In fact, before many banks suspend new account opening, some banks have already done the risk warning of precious metal business. In early November, the postal savings bank, the Bank of China and the Bank of communications, as well as some joint-stock banks such as China Merchants Bank, Ping An Bank and China CITIC Bank, issued early warnings to remind investors that the risks in the precious metal and foreign exchange markets may increase.

Some people in the banking industry told reporters, this years precious metal market has experienced several waves of large fluctuations. When the market is good in the first half of the year, the number of new customers and transactions are large. However, with the market fluctuations intensified, the number of customer complaints has increased. Therefore, banks have strengthened the corresponding risk control.

Dealing with market risks

In an interview with Securities Daily, Wang Yanxing, a senior researcher at Chongyang School of finance, Renmin University of China, said that there were four main reasons why many banks issued announcements to suspend customers account opening and trading of precious metals. First, the price fluctuation in the international precious metal market has increased in recent years, and the risk of precious metal business for individual customers has increased. Second, due to the changes of global political and economic situation and epidemic situation, the risk of uncertainty in the precious metal market has increased significantly. Third, the market risk is unprecedented, and it is more difficult for banks to protect the rights and interests of investors. Fourth, the income and risk of precious metal transactions in bank accounts are not matched and asymmetric. Therefore, it is an effective way to deal with risks by suspending the new contract opening, controlling the position of the existing business and improving the awareness of prevention.

Jiang Shu, chief analyst of Beijing Jinyang Mining Co., Ltd., told reporters that the account commodity trading of domestic banks is an investment variety in the international market that connects domestic investors and dollar pricing. When the international market price fluctuates greatly, it often brings psychological impact to domestic investors who participate in bank account commodity trading. Therefore, the domestic commercial banks have to take risk control measures such as suspending trading when facing some abnormal price fluctuations.

Compared with the risk management mechanism written by domestic and foreign commodity or futures exchanges, the patching or temporary intervention measures taken by domestic commercial banks on account commodities, such as suspending open positions, are still unsatisfactory. The more strict risk management measures agreed in advance may be the direction for future improvement. According to Jiang Shu.

Source: Securities Author: Li Wen, trainee reporter, Yu Junyi, editor in charge: Wang Xiaowu_ NF