For many years the clearing of gold and silver in the London market was facilitated by the clearing members of The London Bullion Market (“LBMA”) exchanging bullion transfer instructions by telephone, facsimile and SWIFT authenticated messages.
In the mid 1990s it was decided that given the way and speed with which financial markets in general were developing and changing, combined with the trend of market supervisors to require more vigorous audit trails and reconciliations, the London bullion market would look at developing the electronic matching system.
Initial exploratory work in this connection was undertaken by The London Bullion Market Association (“LBMA”) Physical Committee, which comprised the clearing members. However, it was subsequently decided that the most effective way of carrying the electronic matching system project forward would be for the clearing members to form a separate company specifically for the purpose of developing and administering such a system. As a result LPMCL was formed in April, 2001.
The LPMCL began to clear platinum and palladium on a loco London basis with effect from 1st September 2009, and since then any transaction maturing on or after the 1st September 2009, dealt on a loco London basis, will be cleared through the five members of LPMCL.
LPMCL is a company limited by shares and its Equity and User Members comprise those bullion clearers that successfully apply for membership.
The founding members were:
The Bank of Nova Scotia
Credit Suisse First Boston International (resigned on 18th, October, 2001, following its withdrawal from precious metals dealing in the London market)
Deutsche Bank A.G. (London Branch) (resigned 18th August, 2015)
HSBC Bank USA N.A. (London Branch) (resigned 17th February, 2015. HSBC Bank plc became a member of LPMCL on 15th November, 2011)
JPMorgan Chase Bank N.A. (London Branch)
N.M.Rothschilds & Sons Limited (resigned on 14th June, 2004 following its withdrawal from precious metals dealing in the London market)
UBS A.G. (London Branch).
Barclays Bank PLC became a member of LPMCL on 9th September 2005. Barclays Bank PLC resigned as a member of LPMCL on 12th September, 2016.
ICBC Standard Bank Plc became a member of LPMCL on 3rd June, 2016.