Russian bank to supply 100 tonnes of gold per year to China

VTB Bank, the second largest bank in Russia, will supply 80 to 100 tonnes of gold to China on an annual basis. The bank announced this on Tuesday well-known, after the first delivery of the gold bars. This makes it the first Russian bank to supply physical gold directly to China on a structural basis.

"The first transaction has a total volume of one tonne of gold. It was sold directly to one of the largest financial institutions in China this month", VTB Bank writes in a statement to the news agency Reuters.

Russia supplies gold to China

VTB intends to further expand its gold shipments over the next twelve months. The bank also wants to attract more buyers in China, so that it can become one of the most important suppliers to the Chinese gold market.

Russia is one of the top five countries with the largest gold mine production. In 2015, the country's gold mining sector extracted a total of 289.5 tonnes of gold from the ground. In Russia, it is common for the mines to resell their precious metals to local banks. VTB Bank also systematically buys gold from the mines and also has good connections with the Chinese banking sector. In a statement, Yuri Soloviev of VTB Bank says the following:

"VTB has a strong position in the Chinese financialële market and the start of physical gold supply to China is an important step within the regional strategy. We believe that the Chinese market also offers long-term opportunities for Russian companies. VTB wants to contribute as much as possible to the development and facilitation of the trade relationship between our countries."

VTB Bank to sell gold to China

Chinese gold market

In October 2015, VTB Bank was offered membership in the Shanghai Gold Exchange (SGE), which allows the bank to trade gold directly with other banks in the Shanghai Free Trade Zone. This is probably also the platform where VTB will offer 80 to 100 tons of gold annually. Last week it was announced that Russia and China have a joint Trading platform for gold want to set up.

VTB Bank already has experience in exporting gold, as it has also been supplying precious metals for the Indian market for some time.

VTB Bank wants to supply 80 to 100 tonnes of gold per year