The Banking Executive Magazine - May 2024 Issue

World Gold Resources COUNTRIES WITH LARGEST GOLD RESERVES The United States holds the world's largest stockpile of gold reserves by a considerable margin. The country's government has almost as many re- serves as the next three largest gold- holding countries combined (Germany, Italy, and France). Russia rounds out the top five. The Interna- tional Monetary Fund (IMF) is one of the top gold reserve holders with 2,814.10 metric tons (3,102.01 stan- dard tons). Below we overview countries with the largest gold reserves in the world: • United States: The United States holds 8,133.46 tons of gold in its reserves. During the height of the Bretton Woods in- ternational exchange system, when the US offered to house and pro- tect other countries' gold in ex- change for dollars, it was reported that between 90% and 95% of the entire world's gold reserves lay in American vaults. Decades later, the U.S. still holds the most. Gold makes up over 75% of its foreign reserves. • Germany: As much as 3,352.65 tons of gold are held in Germany's reserves. This represents two-thirds of its for- eign reserves. The country's gov- ernment keeps its gold reserves in several locations, including: Deutsche Bundesbank in Frankfurt am Main, U.S. Federal Reserve Bank branch in New York, Bank of England in London, Banque de France in Paris. • Italy: Italy falls in the third spot with 2,451.84 tons of gold. The euro- zone crisis led some to call for Italy's government to sell some of its gold reserves to raise funds, but no such plans ever materialized. The country stores the majority of its gold bullion, more than 87%, in the Bank of Italy's head office and the United States. The remainder is divided between vaults in Switzer- land the United Kingdom. Accord- ing to the central bank, it stores gold in different locations for his- torical reasons and to minimize risk. • France: With 2,436.97 tons, France has the fourth-largest gold reserves in the world. Former President of France Charles de Gaulle was partially re- sponsible for the collapse of the Bretton Woods system when he called the US bluff and began trad- ing dollars in for gold from the Fort Knox reserves. Then-president Richard Nixon, who knew that the fixed rate of $35 per gold ounce was too low, was eventually forced to take the US off the gold stan- dard, ending the dollar's automatic convertibility into gold. • Russian Federation: Russia overtook China as the fifth- largest holder of the yellow metal in 2018 with 2,332.74 tons. Rus- sia's increase in its gold stores was seen as an attempt to diversify be- yond American investments. Rus- sia mainly sold US Treasury bonds to buy the bullion. GOLD HISTORICAL VALUE Gold has long been viewed as one of the best stores of value. Gold is re- spected around the world for its value and rich history, which has ISSUE 185 MAY 2024 the BANKING EXECUTIVE 11