By Ese Erheriene 

LONDON--ICBC Standard Bank PLC said on Monday it is buying Barclays PLC's precious-metals vault, in the latest move by the Chinese bank to increase its role in the market's infrastructure.

The move makes parent ICBC, the world's biggest bank, the first Chinese lender to own a vault in London and extends its influence in precious metals from pricing to storage. With China the largest consumer of many metals, the country's banks have increasingly bid to own or help run the infrastructure in these markets.

The vault, one of the largest in Europe, stores gold, silver, platinum and palladium.

"This is an exciting acquisition for the Bank," said Mark Buncombe, head of commodities at ICBC. "This enables us to better execute on our strategy to become one of the largest Chinese banks in the precious metals market."

The deal is expected to be completed in July.

Last week, ICBC Standard Bank became the first new bank in over a decade to join the London precious metals clearing system, joining banks such as Barclays, HSBC PLC, J.P. Morgan Chase & Co. and UBS Group AG.

In early April, ICBC said it would join the twice-daily electronic auctions that set the LBMA Gold Price benchmark. The Bank of China and China Construction Bank already help set this benchmark.

Around 407 million ounces of gold was settled between members of the London Bullion Metal Association in March, down 1% year-over-year, according to data from the association.

There are seven providers of vault services to the London bullion market, including the Bank of England and HSBC PLC. London is the world's biggest metals trading hub, though futures exchanges in Shanghai are increasing their trading volumes at a fast pace.

"If anything that kind of reconfirms London's centrality," said Adrian Ash, head of research at BullionVault, an online bullion marketplace. "If you want to be a dominate player in gold, then it would make sense for you have some involvement [in London]."

Like many banks, Barclays has been moving out of the precious metals market. The British bank announced in late January that it was exiting metal trading, following in the wake of several high-profile banks and trading houses, including Deutsche Bank AG and Switzerland-based Gunvor Group.

Write to Ese Erheriene at ese.erheriene@wsj.com

 

(END) Dow Jones Newswires

May 16, 2016 10:31 ET (14:31 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
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