The London Bullion Market Association's vision is to increase its power to be able to act, as a voice of the market, and represent its members should the need arise, CEO Ruth Crowell told Platts Wednesday.
Crowell was responding to recent criticism from certain quarters that -- as the industry body -- it has been slow to respond to some situations.
The CEO said that the LBMA has an open door policy to all its members, urging them to "pick-up the phone" should they have any issues or concerns.
"My message to our members would be to call me anytime," she said.
The LBMA said February 4 that five service providers had made the final cut to submit a "request for proposal" to increase transparency in the London bullion market, widely believed to be CME Group, the London Metal Exchange, IntercontinentalExchange, Autilla/Cinnobar and Markit/ABS.
None of the parties, nor the LBMA, would comment on the specifics of the matter.
According to the trade body, "the purpose of these new services is to address the immediate regulatory, cost and growth requirements of the market, which will connect via a technology interface called the LBMA-i."
Regarding the current RfP process, Crowell said there is still a lot of work to be done, "if there were a simple solution, it would be implemented already."
Responding to suggestions that the LME, World Gold Council and LBMA are currently in discussions to reform the market, the CEO said it was no secret that the LBMA and WGC collaborate on certain market issues, to pool resources and knowledge.
However, talk of a collaboration with the LME was played down as nothing more than market chatter.
There was market talk last year of a partnership between the LBMA and WGC.
The LBMA said Wednesday that this wasn't a likely outcome, and that working together on specific projects was more feasible.
WGC INITIATIVE Last October, the WGC confirmed it was in talks with certain parties to modernize the London market.
Market sources said that -- separate to the RfP process -- the WGC is in discussions with banks including Morgan Stanley, Societe Generale, Goldman Sachs, ICBC/Standard Bank and Citigroup.
None of the banks would comment on the matter.
Crowell said that as part of the RfP process the LBMA is in talks with all relevant parties, and that any solution could see more than one suitor as the preferred bidder.
Regarding talk that the LME is a front-runner, the LBMA said that it is impossible for there to be a favorite as no proposals have yet been submitted.
FRAGMENTATION
There are some concerns that the whole process could lead to a fragmented London bullion market, with whoever isn't chosen by the LBMA going against the solution provider and offering alternative products.
Crowell said that fragmentation of the London market did not concern her, as she doesn't see that eventuality playing out.
"There are lots of different stakeholders, with different needs. Some work in the physical market, others in the futures," she said.
The result of the RfP should create a platform that creates future growth for the London market.
"[The] LBMA intends for the new services to be able to support the introduction of future services -- for example over-the-counter clearing -- subject to the appropriate market regulatory conditions and LBMA membership demand," the industry body's website reads.
Looking specifically at the recent issues with the LBMA Silver Price -- operated and administered by CME/Thomson Reuters -- Crowell reiterated her vision that the benchmarks, not the entire London OTC market, should move to central clearing.
"The silver price needs members to step up and increase participation," Crowell said.
She was under no illusion of the reputational damage issues with the prices could have to the trade organization. However, she underlined that the Financial Conduct Authority regulated administrator, Thomson Reuters, had to be the official voice ahead of the LBMA.
The LBMA owns the intellectual property of the London gold, silver, platinum and palladium prices.
The gold price is operated/administrated by IBA, the benchmark arm of IntercontinentalExchange, platinum and palladium by the London Metal Exchange and silver by a partnership between CME Group/Thomson Reuters.
Some have been questioning the LBMA's role in the market, suggesting it needs to decide if it's a regulator or a trade body.
"We are both a trade association, and a regulator for refiners, as we have always been," was Crowell's response.
