Singapore is significantly bolstering its position as a global gold hub, with DBS Bank announcing a substantial expansion of its gold vault. This move is part of a broader strategy by the city-state to attract more of Asia's considerable gold market, which accounts for about 70% of annual global consumer demand. The expanded vault capacity at DBS is expected to support increased trading and storage of physical gold, catering to growing institutional and retail interest in the precious metal.
The push includes a range of initiatives beyond physical storage. The Singapore Exchange (SGX) is set to launch an over-the-counter (OTC) gold clearing system by the end of 2026, with interbank trading expected to ramp up from 2027. This system will support both large bars and kilobars, standardizing settlement during Asian trading hours. Participating banks include major players like JPMorgan, Deutsche Bank, DBS, OCBC, UOB, and ICBC Standard Bank.
Furthermore, the Monetary Authority of Singapore (MAS) will introduce gold-vaulting services for foreign central banks and sovereign entities by October 2026, offering gold accounts to select Singapore-based bullion banks to provide gold-related services and liquidity. MAS is also removing the 5% cap on physical investment precious metals under tax incentive schemes for funds, allowing eligible funds and family offices greater flexibility in diversifying their portfolios with physical gold. The SGX is also exploring the relaunch of a physically deliverable gold futures contract to enhance price discovery and risk management, complementing new offerings like tokenized gold by DBS and OCBC-LionGlobal.
