Bank of Nova Scotia is selling its precious and base metals business, ScotiaMocatta, the Financial Times reported Oct. 18, citing "people in the market."
The decision to sell was reportedly triggered by issues surrounding Dallas-based refinery Elemetal and its consequent removal from the London Bullion Market Association's "Good Delivery List." Workers at Elemetal's subsidiary, NTR Metals, had been accused of money laundering involving gold smuggled from Peru. In light of the charges and their repercussions, those who hold Elemetal gold are finding it hard to sell the metal.
Scotiabank is one of Elemetal's largest lenders, the FT noted; it is also one of just five banks settling gold trades in the London market.
Scotiabank reportedly has Chinese buyers in mind and has engaged the services of JPMorgan for the sale.