Shanghai Gold Exchange to name new chairman ahead of benchmark launch

Oct 13 The Shanghai Gold Exchange (SGE) is likely to name Jiao Jinpu, an official from China's central bank, as its new chairman, two sources said, in a move that could pave the way for the planned launch this year of a yuan-denominated gold benchmark.

The SGE, the world's largest physical gold exchange, has been without a chairman for nearly six months since former head Xu Luode was appointed executive vice president of Bank of China .

The arrival of Jiao is expected to prompt the exchange to push ahead with the launch of a Chinese gold benchmark that has been in the works since early 2015 as the country seeks more say over the pricing of the precious metal.

"There hasn't been a lot of big moves (by the exchange) recently because there was no chairman," said one of the sources with direct knowledge of the matter.

"(Jiao) is a respected figure in the Chinese financial industry. Once he settles in, we should see things move."

The SGE said in June that the benchmark would be launched this year.

Jiao has held several positions with the People's Bank of China (PBOC), and was most recently the head of the central bank's financial consumer protection agency. The SGE is an arm of the PBOC.

A spokeswoman for the SGE said the exchange will have a board meeting "very soon" to vote on the appointment of a new chairman, declining to comment on names.

The sources, who did not want to be named as they were not authorised to speak to the media, said Jiao has already started work at the exchange.

China, the top producer and consumer of gold, has been ramping up efforts to open up its bullion market to foreign players and play a bigger role in pricing.

"The exchange will continue with the internationalisation of the Chinese gold market. That should not change because it is not just the ex-chairman's policy but also state policy," the source said.

The SGE launched an international platform of the bourse last year, allowing foreign players to trade yuan-denominated gold contracts for the first time.

The push comes at a time when the global benchmark set in London has come under fire for alleged manipulation.

The PBOC has been supportive of reforms in the gold market. Pan Gongsheng, a PBOC deputy governor, said in June the central bank would continue to support "speedy and healthy growth of the China gold market" and its internationalisation. (Reporting by A. Ananthalakshmi; Editing by Richard Pullin)