China’s ICBC Standard Bank, the world’s biggest bank by assets, has agreed to buy a massive vault in London

China’s ICBC Standard Bank, the world’s biggest bank by assets, has agreed to buy a massive vault in London

It will be the first Chinese lender to own a vault in London as it looks to grow its precious metals business

The vault, which is in a secret location and is being sold by Barclays, can hold up to 2,000 metric tons of gold, silver, platinum and palladium

The deal will give ICBC more influence over trading, pricing and storage of precious metals

No financial details were given but the deal is expected to be completed in July

China accounts for more than a quarter of global gold demand but trading of the yellow metal remains centred out of London and New York. Around $5tn (3.5tn pounds) in transactions were handled in London’s bullion market last year

ICBC Standard Bank’s head of commodities Mark Buncombe said the purchase "enables us to better execute on our strategy to become one of the largest Chinese banks in the precious metals market"

Last week, ICBC became a member of London’s precious metals clearing system, which is where trades are settled

As ICBC takes on more Western clients, the bank needs infrastructure close by to store the physical gold or metals

Barclays, meanwhile, is exiting the precious metals business as part of a restructuring aimed at making the bank smaller and more focused

The vault is one of the largest in Europe and took more than a year to build

It was opened in 2012 by Barclays, which says it is located within the M25 motorway that circles London

The London bullion market has seven providers of vault storage services, including the Bank of England, HSBC and JPMorgan Chase