THE government has allowed three more banks, including a foreign lender, to import gold, sources with direct knowledge of the matter said, as the world’s top gold buyer gears up for its strongest effort yet to gain pricing power of the metal.

    The move, which brings the number of firms allowed to import gold into China to 15, comes ahead of the launch in September of a new international bullion exchange in Shanghai with which China hopes to become a price-discovery center.

    China and other Asian gold trading centers such as Singapore are calling for more localized pricing of the precious metal as they seek alternatives to the so-called London fix, the global benchmark for spot gold prices, which is being investigated by regulators on suspicion that it may have been manipulated.

    Standard Chartered, Shanghai Pudong Development Bank and China Merchants Bank were given regulatory approval recently to import gold, five sources with direct knowledge of the matter told Reuters.

    “We were given the license earlier this month. We haven’t started importing yet but we will soon,” said a source at one of the three banks, speaking on condition of anonymity as the news has not yet been publicly announced.

    Trading data from the Shanghai Gold Exchange (SGE) — the platform for all physical trades in China — show Shanghai Pudong Development Bank was ranked among the top 10 trading members every month from January to July, while China Merchants was among the top 10 for five out of seven months.

    “We are active traders on the SGE and have been waiting for the gold import license for more than a year now,” said a source at China Merchants Bank.

    Allowing more banks to import is a sign of willingness by regulators to open up the market, especially to foreign firms, but the move does not necessarily mean import volumes into China would increase significantly in the near term given current weak demand.

    China has increased the pace of liberalization of the gold market over the past year, with the approval last year of the country’s first gold-backed exchange-traded funds, extended trading hours and the granting of import licenses to foreign players.

    ANZ and HSBC were granted import licenses late last year.

    China approached foreign banks, gold producers and refiners to participate in SGE’s international bourse, sources told Reuters earlier in the year, to boost its position as a price-discovery center for gold. It plans to launch three physically-backed gold contracts.

    (SD-Agencies)