LONDON (Reuters) - Bank of Nova Scotia (Scotiabank) is restructuring its metals business and several senior staff in London and New York are leaving after the Canadian bank was unable to sell the ScotiaMocatta unit, four sources familiar with the matter said.
Scotiabank, which declined to comment on Wednesday, began a strategic review of ScotiaMocatta in 2016 after a string of lawsuits related to the manipulation of gold and silver price benchmarks and due to dissatisfaction over its performance, sources previously told Reuters.
Goldman Sachs and Citibank had both declined to buy ScotiaMocatta, and Scotiabank said in February it would instead slim down one of London’s main gold trading banks, whose origins date back to the 17th century.
The bulk of ScotiaMocatta’s business is in precious metals, where market sources say it had annual revenues of $100-$180 million, and it is one of five banks that clear bullion in London’s $5 trillion a year gold market, the world’s biggest.
ScotiaMocatta says it employs more than 160 people in 10 offices around the world.
Staff in London were told on Tuesday that Steven Lowe, managing director of base and precious metals in Europe, was leaving, two sources said. Lowe did not respond to several attempts by Reuters to contact him for comment.
Matthew Campbell, ScotiaMocatta’s global head of base metals sales based in London, was also leaving, along with a handful of other staff in London and New York, the sources said. Campbell declined to comment.
ScotiaMocatta will be incorporated into Scotia’s broader global commodities business and run from Canada under the management of Brian Manson, managing director and global head of commodity derivatives and G10 foreign exchange, sources said.
The move was likely to be the first of a series of changes that will sharply shrink the metals business, the sources added.
“This is the first step,” said one.
Reporting by Peter Hobson; additional reporting by Pratima Desai; Editing by Veronica Brown and Alexander Smith