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Who Has the Most Gold?

The price of gold eclipsed $1,800 per ounce in August, rising 26.0% in 2011, following uncertainty in the equity markets and the global economy as a whole.

The biggest individual holders of gold—central banks, international entities and governments—are believed to account for approximately 16.5 percent of the world’s gold, holding about 30,700 tons.

The numbers are taken from the monthly report produced by the World Gold Council, which is the gold industry’s key market development body. The holdings presented here are as of WGC’s August 2011 report, unless otherwise noted.

So, who holds the most gold? Let’s go to find out!

15. Portugal

Value of reserves: $24.6 billion
Holdings total: 421.5 tons

The westernmost nation in mainland Europe is home to the 15th largest gold reserve in the world. At 421.5 tons, Portugal’s holdings are overseen by Banco de Portugal and are valued at roughly $24.6 billion, accounting for 84.8 percent of the country’s foreign reserves.

14. Taiwan

Value of reserves: $27.2 billion
Holdings total: 466.8 tons

Renowned for its technology industry and robust economic growth, Taiwan also boasts one of the largest gold reserves in the world.

The Central Bank of the Republic of China (Taiwan) manages the island nation’s foreign reserves, which have been reported at 466.8 tons. These holdings are worth $27.2 billion at today’s prices and comprise approximately 5.0 percent of the country’s foreign reserves.

13. The European Central Bank

Value of reserves: $32.23 billion
Holdings total: 553.3 tons

Established in 1998 by the European Union, the European Central Bank (ECB) is responsible for the monetary policy of the member nations of the euro zone and is headquartered in Frankfurt.

The ECB’s 553.3 tons of gold accounts for 31.3 percent of the bank’s foreign reserves and would be worth $32.23 billion in today’s market.

12. India

Value of reserves: $35.79 billion
Holdings total: 614.6 tons

Shooting up in the rankings in the past few years is India. The second most populous nation in the world maintains the 12th largest gold reserves. The size of India’s holdings were bolstered in November 2009 by a $6.9 billion purchase of 200 tons of gold from the International Monetary Fund.

The Reserve Bank of India currently oversees the country’s 614.6 tons of gold, which are valued at $35.76 billion, comprising 8.7% of its foreign reserves. India’s current ranking may also continue to move upwards, as the government has asked the Geological Survey of India to mine previously untapped gold reserves in many of its states.

11. The Netherlands

Value of reserves: $39.3 billion
Holdings total: 674.9 tons

The Netherlands has the 11th largest reserve on the list, with 674.9 tons of gold. The Netherland Bank manages the country’s national finances, including the gold reserves, which amount to approximately $39.3 billion and account for 58.9 percent of the country’s foreign reserves.

10. Japan

Value of reserves: $49.11 billion
Holdings total: 843.3 tons

Although Japan is ninth on the list, its 843.3 tons of gold account for only 3.3 percent of total foreign reserves. On the open market, Japan’s gold reserves would be worth around $49.11 billion, and are overseen by the Bank of Japan.

9. Russia

Value of reserves: $53.7 billion
Holdings total: 922 tons

The Central Bank of the Russian Federation is in charge of the country’s 922 tons of gold, which are valued at $53.7 billion and comprise 7.7 percent of the country’s foreign reserves.

In 2009, Russia increased its gold production by 21 percent, due in part to the launch of several new mines. Last year, the country overtook Japan in total holdings, adding more than 140 tons to its stockpile in 2010 alone.

8. Switzerland

Value of reserves: $66.75 billion
Holdings total: 1,146.2 tons

The Swiss National Bank conducts Switzerland’s monetary policy and manages the country’s 1,146.2 tons of gold.

With the world’s eighth largest reserve of the precious metal, Switzerland’s supply is worth approximately $66.75 billion in today’s gold market. It accounts for 17.8 percent of the country’s foreign reserves, though this is down significantly from a year earlier.

7. China

Value of reserves: $67.65 billion
Holdings total: 1,161.6 tons

At 1,161.6 tons, the world’s most heavily populated country has the world’s seventh largest gold reserve. Expect it to be higher on the list? Well, bear in mind that China’s gold only accounts for 1.6 percent of its foreign reserves. With a population of 1.34 billion, the country holds about $50.49 worth of gold per person, totaling $67.65 billion.

6. SPDR Gold ETF (GLD)

Value of holdings: $70.7 billion
Holdings total: 1,213.9 tons

Unlike other major gold holdings, this is one that investors can actually buy in to. As the price of gold fluctuates, so does the value of SPDR Gold Trust, also known the GLD. The fund held 38,845,889 ounces, or 1,213.9 tons of gold as of its 10-Q filing on June 30, 2011.
Although gold is off it’s all time highs, during the week of August 22, 2011, the SPDR Gold Trust surpassed the heavily-traded S&P 500 SPDR (SPY) for the first time. Like many investors, the ETF has indicated they have increased their holdings of gold since their most recent filing.

Pictured: Gold bars are displayed at the GLD Fifth Anniversary Celebration Hosted By SPDR Gold Shares in New York

5. France

Value of reserves: $156.31 billion
Holdings total: 2,683.8 tons

The French National Bank, Banque De France, is home to the country’s gold holdings, which comprise 66.2 percent of its foreign reserves. With 2,683.8 tons of gold in reserve, France’s holdings are worth approximately $156.31 billion.

4. Italy

Value of reserves: $157.36 billion
Holdings total: 2,701.9 tons

The Banca D’Italia manages Italy’s foreign reserves, which have been reported at 2,701.9 tons by the World Gold Council and comprise the fourth largest gold reserve in the world.

These holdings are worth $138.33 billion and account for 71.2 percent of the country’s foreign reserves.

3. The International Monetary Fund

Value of reserves: $180.6 billion
Holdings total: 3,101 tons

The International Monetary Fund (IMF) oversees international economic operations of 185 member countries. Its gold policies have changed in the last 25 years, but the reserves remain to stabilize international markets and aid national economies.

In one such instance, the IMF sold a portion of its reserves in December 1999 to aid the Heavily Indebted Poor Countries Initiative. The 3,101 tons of IMF Gold would fetch roughly $180.6 billion in the open market.

2. Germany

Value of reserves: $218.28 billion
Holdings total: 3,747.9 tons

The Deutsche Bundesbank, Germany’s central bank, has 3,747.9 tons of gold reserves, which are valued at about $218.28 billion. According to the World Gold Council, Germany’s gold coffers account for 71.4 percent of total foreign reserves.

1. United States

Value of reserves: $522.16 billion
Holdings total: 8,965.6 tons

The United States Bullion Depository in Kentucky—otherwise known as Fort Knox—is the most famous gold stockpile in the world. It holds the majority of the nation’s gold reserves, the remainder of which is held at the Philadelphia Mint, the Denver Mint, the West Point Bullion Depository and the San Francisco Assay Office.

Altogether, the total gold reserves of the U.S. equal 8,965.6 tons and would be valued at approximately $522.16 billion in today’s market.

Source: World Gold Council, with conversions by CNBC | Photo: Cliff

Central banks, net buyers of gold for the first time in a generation, are likely to retain their holdings even if they need to raise cash to counter an escalating debt crisis, according to Morgan Stanley.

Currency Credibility

“The European central banks won’t sell their gold because while it may be a means to raise cash, it definitely won’t be enough to settle their debts,” said Duan Shihua, head of corporate services at Haitong Futures Co., China’s largest brokerage by registered capital. “Besides, none of the central banks believe in the currencies of other countries.”

In 2010, central banks became net buyers for the first time in two decades, adding 87 metric tons in purchases by countries including Bolivia and Mauritius, according to World Gold Council data. In the second quarter of 2011, central bank and government-institution buying rose almost fivefold to 69.4 tons, taking the first-half total to 192.3 tons, the council said last week. The banks will remain net buyers this year, it said.

Central banks have been “active buyers” of gold in recent months, Edel Tully, an analyst at UBS AG, wrote in a note to clients on Aug. 8. The banks should also buy platinum as they boost gold holdings amid concern about the global economy, Citigroup Inc. said in a report the same day.

Credit-Rating Downgrades

The debt crisis in Europe that started in Greece has hobbled economic growth and prompted downgrades of the credit ratings of Greece, Portugal and Ireland. Still, the euro has strengthened against the currencies of 14 of 16 trading partners this year as the European Central Bank bought government bonds.

German Chancellor Angela Merkel yesterday rejected a call by Labor Minister Ursula von der Leyen for states to put up gold as collateral for emergency loans. That disagreement may underscore risks over a second Greek aid package.

In August 2009, central banks in Europe agreed to a third five-year cap on gold sales. The European Central Bank and 18 others agreed to sell no more than a combined 400 tons a year through September 2014. Germany, Italy, France, the Netherlands, the European Central Bank, Portugal, Spain and Austria are among the top 20 holders, according to council data.

IMF Sales

“Notwithstanding the worst sovereign-debt crisis, particularly in Europe, where there are very large, concentrated holdings of gold, the central-bank agreement has been striking by the fact the only people who have been selling has been the IMF,” said Richardson, referring to the Washington-based International Monetary Fund.

The IMF sold 403.3 tons between October 2009 and December 2010 as part of a plan to shore up its finances and lend at reduced rates to low-income countries. More than half of that was acquired by central banks, according to the fund.

The Bank of Korea, which purchased 25 tons over a one-month period from June to July, said “holding gold helps reduce investment risks in terms of reserve management,” according to a statement earlier this month after the move was disclosed.

To contact the reporter on this story: Glenys Sim in Singapore at gsim4@bloomberg.net

To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net

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