A Brief History of the London Bullion Market

Many of us only dream to have access of such vast amounts of wealth, however, for those of us in the UK the trade of gold and silver tends to only be for those of who are members of the London Bullion Market Association.  The LBMA is an association that is loosely overseen by the Bank of England and only deals with bullion dealers or refiners and international banks and manages the ‘over the counter’ trade between bullion dealers.

How it all began

You can trace the London bullion market back to 1600’s with the partnership of Moses Mocatta and The East India Company. Moses Mocatta was the founder of ‘Mocatta and Goldsmid’ in 1961, which is one of the oldest bullion brokerage firms in the world today. During the 17th Century, whilst Isaac Newton was leading the Royal Mint, the gold in England became much more freely circulated than silver, which led to England producing many gold based coins whilst the rest of Europe were still dealing in silver until the late 19th Century.

The Gold Rush

In the 17th Century, The East India Company brought gold from Brazil to London and housed it in a London vault, which was set up by the Bank of England. This subsequently became a housing facility, which was used to serve the rest of Europe. The Bank of England’s involvement with setting up the purpose built vault became a key player in the distribution and management of the gold, especially after the influx of events such as the famous gold rush in California, Australia and Africa. At this time, approximately 60% of the world’s trade of gold passed through London.


In 1749, the Royal Mint John Lucas, who was an assayer, to oversee the quality of the gold coming into the London vault, which ultimately led to having a ‘Good Delivery’ list. This list of specific gold refineries ensured that the gold coming into London was that of a high standard from a trusted source. Samuel Plumb and Browne were the first gold refineries to be added to this list in 1754. By 1850, there were fiver refineries on the list that dealt with the trade and quality of gold coming in and out of London. These companies consisted of Mocatta and Goldsmid, N M Rothschild & Sons, Sharps Wilkins, Samuel Montagu & Co and Pixley & Abell.

The London Gold Market

The Good Delivery List that consists of these refineries has remained unchanged over the years, however the set up became slightly more different in the 20th Century. These refineries would eventually oversea the entire gold market coming into London, whilst also making sure that the companies responsible for maintenance and the assayers were appropriate and of a high standard.

The Gold Market Fixing Company

The Gold Fixing Market refers to the arrangement made between the Bank of England and N M Rothschild and Sons in the early 20th Century where it would be agreed upon for the formation of the free gold market where there would be an official set price on any one day. The original five refineries on the Good Delivery List would perform the first fix in 1919 and form the Gold Market Fixing Company between the five of them.

Inflow to the US

The Wall Street crash in 1929 saw the expansion of the Good Delivery List when large amounts of gold and silver were being melted down which all had to be sorted into ‘Good Delivery’ status. However, with a new fixed price set in America in 1934, the inflow increased. This prompted the even bigger expansion of the Good Delivery List, which eventually extended to 20 refineries and mints in 8 different countries.

London Bullion Market Association

Due to the vast increases and decreases of the fixed gold price and the constant maintenance of the Good Delivery List and other resulting lists, the Bank of England felt that this scale of business would need to be looked after by an independent body. In 1987 the London Bullion Market Association was formed, and their job is to, amongst many things, oversea the whole process of gold and silver trade and maintain the good delivery list and deal with traders. The Bank of England still remains loosely involved with the LBMA as the facilitator. To be considered for Good Delivery Status, it is now required by LBMA to assure Responsible Gold Guidance.

You may not be able to get your hands on those much desired gold and silver bars, but if you have any gold or silver coins (or notes for that matter!) that you need exchanging, or simply need a quote, then we would love to help. Please don’t hesitate to get in touch with our experienced team for advice.

Send your coins to us now

Leave a Reply

Our clients