Australia's first physical bullion Exchange to open

The Australian Bullion Exchange (ABX), Australia’s first physical bullion exchange, will begin operations 24 October 2011.

The ABX is an Australian domiciled over-the-counter (OTC) spot market for investment-grade gold, silver and platinum bullion. The exchange is a principal-to-principal investment market formed through a member structure of finance and bullion industry participants.

The ABX will be an efficient and globally recognised OTC bullion market in Australia, making direct bullion ownership available to retail and institutional investors. Bullion will be bought and sold on the ABX through listed brokers, or Members. Applications for Membership are currently open. The ABX is currently targeting a number of large financial institutions to register as Members.

Thomas Coughlin, CEO of the ABX, said: “The ABX is an exchange for physical bullion, much like the ASX is an exchange for equities; it connects buyers and sellers of precious metals.

“Given the strength of the physical bullion investment market, a central exchange is critical to provide a fair and efficient marketplace for all participants. Australia is the second largest gold producer in the world; we should have a globally recognised exchange to accompany this position.

“Precious metals hold significant value as an investment asset class, but at the moment the holistic options for direct ownership of bullion are limited in Australia. The ABX strips away all financial engineering to provide a marketplace that is simple, secure and highly accessible and, at the same time, improves competition and market efficiency.”

The market will be priced on the ABX Australian spot price for gold, silver and platinum bullion in nine different currencies. This price is set by demand and supply forces for Australian bullion. The ABX will also set a Fix Price at 10:30am and 3pm each business day via a teleconference with five elected Members of the Exchange.

“We offer a holistic end-to-end facility for investors wanting exposure to precious metals based on world best practice quality assurance frameworks, security arrangements, technology systems and governance structures,” said Mr Coughlin.

Significant investment has been made in systems and technology to create a robust and reliable investment platform. The ABX will also offer custodial services for investors who do not want to store
the bullion themselves.

Brady plc, a leading global supplier of trading, risk management and settlement solutions to the metals, energy and soft commodity sectors, was recently selected to supply to ABX’s core
infrastructure system.

The ABX has adopted the London Bullion Market Association (LBMA) principles for assessing bullion, widely recognised as world best practice. This is supported by a rigorous audit regime provided by
global bullion inspection and audit leader, Inspectorate.

The ABX’s formal advertising campaign launches today.