Bank Precious Metals Business Tightens Further, How Should Investors Allocate?

Source: International Financial News

Author: Li Ruohan

Since the end of 2025, international gold prices have experienced a rollercoaster market, and banks have increased the frequency of adjustments to precious metals.

According to observations by the International Financial News reporter, in addition to the continuously rising investment thresholds and risk level requirements for stored gold, many institutions have recently explicitly stopped agency physical precious metals deferred trading or announced trading limits on stored gold businesses.

Experts interviewed pointed out that banks’ measures are partly to proactively control customer risks under extreme market fluctuations and partly to implement investor suitability management. With gold prices fluctuating at high levels, it is expected that bank precious metals businesses will shift from simple trading channels to comprehensive wealth management services.

Tighter Risk Control in Precious Metals Business

From the official websites of various banks, the current bank precious metals businesses mainly include physical precious metals sales, stored gold products, and agency for Shanghai Gold Exchange personal precious metals trading.

Notably, Postal Savings Bank of China and China Minsheng Bank recently issued announcements stating they will cease agency for Shanghai Gold Exchange personal precious metals trading.

According to Postal Savings Bank’s announcement, based on their February 11 business adjustment notice, from that day until March 13, 2026, at 0:00, they will stop agency for Shanghai Gold Exchange personal precious metals trading, including contracts such as Au99.99, Au100g, etc. Customers holding these contracts or with physical inventory are warned that if they do not sell or close their positions by March 27, 2026, at 0:00, their accounts will be subject to forced actions.

Minsheng Bank stated that since market close on July 22, 2022, they have already closed buy and open trading functions for this type of business. Due to recent severe market volatility, they remind individual clients who have not yet terminated contracts to promptly handle contract extensions, inventory sales, withdrawals, and terminations.

It is worth noting that at the end of February this year, several state-owned major banks proactively implemented risk management measures, raising the margin ratio for individual clients’ deferred contracts on the Gold Exchange to 100%.

Additionally, some institutions’ stored gold businesses have also implemented quota management after multiple threshold increases. On March 15, a social media user shared a screenshot of a failed purchase of stored gold from a certain bank with the message: “Stored gold reached the limit for the day, please try again tomorrow.”

In early March, China Construction Bank announced that to further strengthen risk control, they would implement dynamic trading limits on CCB Gold (including Easy Storage Gold) starting March 4. Meanwhile, Industrial and Commercial Bank of China (ICBC) clearly stated in their latest Ruyi Gold stored gold business agreement that they would dynamically manage quotas based on market conditions, risk management needs, business requirements, and regulatory demands. Quota types include daily stored or redeemed amounts per customer, single transaction limits, etc.

An industry insider told the reporter that these measures are partly to proactively control customer risks amid extreme market fluctuations and partly to implement investor suitability management.

“Gold prices hit record highs in early 2026, with volatility significantly increasing. Banks stopping or limiting related businesses aim to avoid clients’ risk of margin calls during sharp market moves. Additionally, some individual investors may engage in irrational speculative behaviors like chasing high prices, so tightening business policies also serve to fulfill the responsibility of protecting financial consumers,” the expert explained.

Transition to Comprehensive Wealth Management Services

“Since March 3, international spot gold prices have been volatile, falling from $5,321.43 per ounce to $4,813.53 on March 18, a decline of 9.54%. This counterintuitive trend mainly stems from the significant suppression of safe-haven logic by interest rate dynamics,” said Qu Rui, Senior Deputy Director of the Research and Development Department at Orient Securities.

Qu Rui believes that gold prices will show a pattern of “short-term pressure, medium- to long-term improvement.” In the short term, high crude oil prices will keep the Federal Reserve’s high interest rate stance and a strong dollar, continuing to suppress gold prices. However, if conflicts persist longer, inflation and economic growth will be more significantly impacted, increasing demand for gold. In the medium to long term, as oil prices’ upward effect diminishes and inflation gradually recedes, the Fed’s rate cut cycle, though delayed, will not be absent. Coupled with ongoing global de-dollarization, steady central bank gold purchases, and weakening dollar credit, gold prices are expected to rebound amid volatility.

In response to current changes in the precious metals investment market, the banking industry has issued frequent risk warnings, advising investors to enhance risk awareness, invest rationally and prudently based on their financial situation and risk tolerance, maintain balanced and moderate allocations of precious metals, and reasonably control positions to avoid blind follow-the-market operations.

With gold prices fluctuating at high levels, how will banks adjust their precious metals businesses in the future?

Liu Youhua, Director of Wealth Research at Paipai.com, believes that future bank precious metals businesses are expected to shift from simple trading channels to comprehensive wealth management services. The focus will turn to products that can smooth out volatility and suit long-term allocation, utilizing technology to enhance risk disclosure and optimize business structure.

“For investors, it is recommended to abandon high-leverage derivatives and short-term speculation, view gold as a long-term ‘stabilizer’ in their asset portfolio rather than a short-term trading tool, and use tools like gold ETFs for long-term, phased allocation to mitigate timing risks and share long-term trends. Additionally, it is important to reasonably set the proportion of gold assets within total personal assets to achieve risk diversification,” Liu concluded.