(Kitco News) Turbulent times of first trying to sell, then downsizing its bullion desk, Canadian Bank of Nova Scotia (Scotiabank) (TSX: BNS.TO) now appears to be closing its metals business, according to Reuters.
Reports came to light on Tuesday with Reuters citing two sources familiar with the matter. “Scotia had a global call with all its metals staff and said it was shutting down its metals business,” one source said. “The plan is to unwind the metals business,” said another one.
The goal is to reportedly wind down all existing metals business by the beginning of 2021, the sources added. The move could mean more challenges for the gold market that has already seen a supply crunch and wide price spreads between spot and futures prices, analysts told Kitco News.
“The Scotiabank shuttering of its metals business is a sign of these historic times of markets upheaval. However, such is not a shock to the metals marketplace that has in recent weeks already seen many companies and mines so severely impacted by the Covid-19 pandemic,” said Kitco’s senior technical analyst Jim Wyckoff.
“From my perspective the Comex futures market has at least temporarily overshadowed the spot, or cash, gold market in terms of accurate daily price discovery, given the significant slowing of spot business and spot market-making.