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| FILE PHOTO: An employee holds gold bars before the refining process at AGR (African Gold Refinery) in Entebbe, Uganda, October 4, 2018. REUTERS/Baz Ratner/File Photo |
LONDON (Reuters) — JPMorgan has earned record revenue of around $1 billion so far this year from trading, storing and financing precious metals, vastly outperforming rival banks, two sources familiar with the matter told Reuters.
The coronavirus has created a bonanza for investment banks dealing in gold, silver and other precious metals by triggering massive investor purchases and rupturing the normal workings of the market.
But JPMorgan has dominated, growing its share of the market.
The U.S. bank’s revenue by mid-November accounts for at least half of the $1.7 billion to $2 billion that consultancy McKinsey CIB Insights estimates the top 10 investment banks combined will make this year from precious metals, mostly gold.
Its commodities division is on track to bring in more than $1.5 billion this year and could challenge Goldman Sachs for the title of top earner, the sources said.
JPMorgan and Goldman Sachs declined to comment.
Individual investment banks have rarely made more than $1 billion in commodities in recent years, and none has ever before earned more than around $600 million in precious metals in a single year, said George Kuznetsov at McKinsey CIB Insights.
Source: Peter Hobson | Reuters
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