"Those with Money Have Already Moved Their Gold"... Holdings Surge 16-Fold as Wealthy Investors Flock to 'This Country'

Private gold holdings up 16-fold since 2014
War, fiscal and political uncertainty drive diversification of storage locations

Wealthy investors from the United States, Europe and the Middle East are choosing Singapore as a place to store physical gold. As war, fiscal instability and political uncertainty intensify, they are weighing not only the value of gold itself but also the security of where it is stored.

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War and Fiscal Uncertainty Push Singapore Into the Spotlight as a 'Safe Haven' for Physical Gold

According to Bloomberg on October 21 (local time), Singapore precious metals dealer J. Rotbart & Co. estimates that private gold holdings in Singapore have increased about 16-fold since 2014, surpassing 800 metric tons last year. Most of the increase came from Europe, and holdings are expected to continue rising this year and next.

The vault capacity of Le Freeport, a facility also known as Asia's Fort Knox, is at least 1,700 metric tons. In May, Le Freeport said that most of its underground vaults were full as demand for gold storage increased.

The Reserve, another major vault facility in Singapore, is also seeing a rapid increase in demand from overseas customers. The gold holdings of customers participating in its gold storage program have tripled since early 2020, reaching 8.6 metric tons as of September this year. About 90% of that gold is owned by overseas customers.

Manish Tibrewal, co-founder of Farro Capital, a multi-family office that provides financial advisory services to ultra-high-net-worth families in Singapore, said, "Wealthy families that previously stored physical gold in other countries are moving some of their holdings to Singapore. Families that did not previously own physical gold are also buying it through private banks or precious metals dealers and storing it in Singapore."

Although gold prices have recently come under downward pressure, gold remains attractive as a safe-haven asset, supported by inflation concerns, uncertainty over long-term interest rates and central banks' gold purchases. With geopolitical risks compounded by fiscal and political instability at home, wealthy investors are also focusing on the stability of the countries where they store their gold.

Singapore is attracting attention as a long-term store of wealth thanks to its stable system of governance, sound fiscal conditions and defense capabilities. Gregor Gregerson, founder of The Reserve, said, "People looking to store gold for the long term, for 30 to 40 years, generally prefer countries that are wealthy, face no imminent pension-system crisis and can defend themselves. Singapore is exactly that kind of country."

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Gold Demand Surges Among Western Wealthy Investors... Public and Private Sectors Race to Expand Trading and Storage Infrastructure

In particular, wealthy investors in the West are showing greater interest amid growing concerns about the U.S. fiscal deficit and political uncertainty.

According to J. Rotbart & Co., online inquiries from Western customers have tripled over the past year. The United States accounted for the most inquiries, followed by Canada, the United Kingdom and Australia. Singapore precious metals trading and storage platform Indigo Precious Metals also said that demand for gold from high-net-worth individuals in Europe and the United States rose about 25% over the same period.

Another precious metals platform, Gold, said that about 40% of its European customers had either moved some of their gold previously stored in Switzerland to Singapore or purchased new gold and decided to store it there. Some investors reportedly reconsidered their views of Switzerland's neutrality after Western countries froze the assets of Russia, which is subject to sanctions.

The Singapore government is also leveraging this trend to expand infrastructure and establish the country as a gold trading hub in Asia. Singapore Exchange plans to introduce a clearing system for over-the-counter gold trading by the end of this year. The Monetary Authority of Singapore provides gold storage services to foreign central banks and sovereign-related institutions. It has also expanded tax incentives for qualifying funds that invest in physical investment-grade precious metals and for family offices.

Financial institutions are also strengthening their related businesses. Nomura International Wealth Management launched physical gold custody services in Singapore in response to requests from customers, including those in the Middle East. Oversea-Chinese Banking Corporation (OCBC) also expanded its physical gold business this year, following an increase of more than 40% from the end of last year in gold holdings among customers of Bank of Singapore, OCBC's private banking arm.

This content was produced with the assistance of AI translation services.