Off The Wire
Wells Fargo expands in precious metals after Scotiabank exit
LONDON (Reuters) - U.S. bank Wells Fargo said it has expanded its precious metals trading business, filling gaps in the market left by the withdrawal of Bank of Nova Scotia (Scotiabank).
Scotiabank was for years the biggest global lender to the physical precious metals industry. It decided in 2018 to downsize and last year to exit the sector.
Wells Fargo in January hired from Scotia a trader and a sales woman in metals, including gold, silver, platinum and palladium, according to the bank and profiles on LinkedIn.
Other banks to have taken on Scotia staff since it began to shrink include Canada's Bank of Montreal (BMO) and Royal Bank of Canada (RBC).
Wells Fargo is focusing on corporate clients, including manufacturers, chemicals producers and refineries in the United States and does little business with hedge funds and other investors, Ryan Moffett, the bank's head of metals and agricultural commodities, said.
"Our expectation is to grow the precious metals business and, as we do, we will add headcount as needed,” Troy Black, its head of commodities, said.
Investment banks have seen a revival in profits from precious metals following market turmoil triggered by the novel coronavirus outbreak, supply issues, rising prices and heightened interest from investors in gold and silver.
Reporting by Peter Hobson; editing by Barbara Lewis