We provide safe custody for the United Kingdom’s gold reserves, and for other central banks. This supports financial stability by providing central banks with access to the liquidity of the London gold market. We also provide gold accounts to certain commercial firms that facilitate access for central banks to the London gold market.
How the Bank of England provides safe-keeping for the UK's gold reserves.
Below the Bank of England is one of the largest stores of gold anywhere in the world. We look after more than 400,000 gold bars worth billions of pounds.
The gold is kept in nine underground vaults, and we guard it very carefully. Our customers are the UK government, banks and other governments around the world. Each gold bar costs hundreds of thousands of pounds.
Their value can go up and down. Our customers can trade the gold bars with other customers at the Bank. When a customer trades gold, it usually doesn't move. Instead, the name of the owner will change on our system.
Not many people are allowed to visit our vaults. However, her late Majesty Queen Elizabeth II, and the then Prince Charles, have had a look around.
Even though we look after lots of gold, we only own two bars.
You can see them in our museum. And if you're feeling strong, you can try to lift one.
Some interesting facts. Did you know that an ounce of gold can be stretched a distance of over 50 miles? All of the gold mined so far in the world would fill more than three Olympic sized swimming pools.
In the past you could exchange banknotes for the equivalent value in gold at the Bank of England, but this has not been possible since the early 1930s.
You can, however, hold a real gold bar in the Bank of England Museum.
We only own two gold bars. Both of these are on display in our museum. Instead, we store the UK’s gold reserves on behalf of HM Treasury, and we also store gold bars on behalf of other central banks and certain commercial firms.
Gold is an important asset of foreign exchange reserves. By providing safe gold custody we are supporting central bank reserve management and thus international financial stability.
London is the global centre for gold trading. We support financial stability by providing central banks with access to the liquidity of the London gold market. We also provide gold accounts to certain commercial firms that facilitate access for central banks to the London gold market.
Gold that we hold on behalf of our customers does not appear on our balance sheet. This is because we provide gold storage on an allocated basis, meaning that the customer retains the title to specific gold bars in our vaults, rather than a claim on the Bank for a certain weight of gold.
The following article, from the LBMA’s magazine “The Alchemist” features Victoria Cleland talking about the Bank’s role in the Gold market.