Recently, Shanghai Pudong Development Bank announced it will halt its precious metals agency services for individual clients through the Shanghai Gold Exchange, becoming the latest institution to exit this arena this year. A review shows that since 2026, at least nine major state-owned and joint-stock banks have scaled back their individual precious metals trading operations by fully discontinuing services or sharply raising margin requirements. This round of adjustments covers the entire spectrum of precious metals contracts, including spot and deferred delivery products. From Postal Savings Bank of China's early-year clearance to several major banks' mid-year closures of trading permissions and higher leverage thresholds, the pace of industry exits has accelerated. Industry experts attribute this concentrated tightening to a structural business adjustment driven by heightened market risks, evolving regulatory directives, and an imbalanced risk-return profile for banks.

On September 8, Shanghai Pudong Development Bank released a notice clarifying it will suspend individual precious metals agency services for the Shanghai Gold Exchange after September 25, 2026, and will close trading access via mobile banking, online banking, and branch counters. Once access is revoked, clients with open positions will face restrictions on liquidation, selling, and physical delivery operations. The bank also urged existing holders to complete their transactions before September 25, 2026, to avoid potential trading restrictions. This move further expands the roster of banks exiting individual precious metals business this year. According to statistics, since 2026, at least nine state-owned and joint-stock banks have introduced tightening measures, primarily through two channels: fully discontinuing services or substantially raising margin ratios, covering all categories of precious metals contracts such as spot and deferred delivery.

The earliest adjustment came from Postal Savings Bank of China, which officially announced in March the suspension of all individual precious metals agency services, including products like Au99.99, Au100g, Au99.95, PGC30g, Au(T+D), mAu(T+D), Ag(T+D), Au(T+N1), and Au(T+N2), with mandatory liquidation for clients who failed to act by the deadline. June to July marked the peak window for this round of industry adjustments, as several major state-owned banks executed closures in succession. ICBC, China Construction Bank, and Bank of Communications issued notices to close all individual precious metals agency trading functions after the settlement on July 24. Following suit, Bank of China fully discontinued related services starting July 31. Among joint-stock banks, Ping An Bank shut down spot contract trading permissions, while China Guangfa Bank, China Merchants Bank, and Hua Xia Bank also completed their contractions and exits, with some banks retaining only lower-risk alternatives like gold accumulation plans.

Beyond outright closures, multiple banks have tightened leverage risk by increasing margin requirements. ICBC has repeatedly strengthened its risk controls, raising the margin ratio for precious metals deferred contracts from 100% to 190% this year, with forced-liquidation margins climbing to 170%. China Guangfa Bank also lifted margins for gold and silver deferred contracts uniformly to 140%, significantly compressing leverage trading capacity. A Beijing investor surnamed Li, with years of trading experience, told reporters, "Leveraged gold trading carries risks far beyond ordinary wealth management products, and average retail investors struggle to withstand such volatility."

Commenting on this wave of bank retrenchment, Xue Hongyan, a special researcher at Sushang Bank, noted that this adjustment stems from a dual choice: pressure from gold price fluctuations and banks' proactive risk management. "Deferred delivery contracts involve leverage and margin features, which under extreme market conditions can trigger forced liquidation, negative account balances, client defaults, and disputes. As agency institutions, banks also bear the burden of clearing, risk control, and reputational exposure, while trading commission income remains relatively modest, diminishing the business's risk-return profile," he said. He added that regulators have consistently strengthened investor suitability management and curbed high-risk derivative businesses, providing clear direction for banks to exit, making this round a combined result of regulatory guidance and proactive bank risk controls.

Tian Lihui, a finance professor at Nankai University, echoed this view, stating, "The core driver is the triple convergence of extreme gold price volatility, tighter regulatory rules, and an imbalanced risk-return structure for banks." He explained that international gold prices have fallen sharply from highs, sharply increasing the risk of account breaches in leveraged deferred trading, forcing banks to cover clearing shortfalls and suffer reputational damage. Meanwhile, new derivatives regulations restrict over-the-counter activities to professional investors, making the regulatory direction irreversible. Additionally, agency commission income is limited, yet banks must invest heavily in systems, clearing, and compliance, creating a severe mismatch between returns and risks. He stressed, "This round of closures is both an industry-wide proactive risk control measure and a strategic contraction aligned with regulatory directives—two sides of the same coin."

The businesses being scaled back are primarily banks' agency services for individual precious metals trading via the Shanghai Gold Exchange, which serve as a main channel for retail investors to access exchange-traded gold. These services include deferred delivery contracts like Au(T+D), mAu(T+D), and Ag(T+D), as well as spot contracts such as Au99.99 and Au100g, each with complex trading rules and distinct risk profiles. Among them, deferred delivery contracts carry leverage, allowing investors to control several times their margin amount, meaning even small gold price movements can lead to multiplied gains or losses, concentrating risk. In contrast, spot contracts like Au99.99 lack leverage but impose high thresholds for physical withdrawal and involve intricate procedures such as physical delivery and inventory transfers, demanding significant expertise and capital from ordinary investors.

Addressing the risks of leveraged precious metals trading, Xue Hongyan noted that margin mechanisms amplify both profits and losses. "When gold prices swing significantly, investors may face margin calls or forced liquidation within a short period. In cases of overnight gaps, insufficient market liquidity, or price limits, even willing investors may not execute at expected prices, and losses can exceed their initial margin," he warned. He pointed out that precious metals prices are influenced by multiple variables, including dollar movements, Federal Reserve interest rate policies, geopolitical tensions, and market sentiment, making short-term forecasting difficult. Ordinary investors often lack the ability to monitor markets continuously, manage capital, or hedge risks, and may misinterpret gold's long-term allocation value as short-term upside potential, turning investment into frequent speculation.

Tian Lihui further dissected the deep risks of leveraged gold trading. "Leverage magnifies price swings, and overnight gaps or concentrated forced liquidations can wipe out principal in an instant, or even leave investors owing money," he said. He also highlighted platform moral hazards, where unregulated off-exchange platforms lure investors with low deposits and high leverage, only to seize funds through fake trades, forced closures, or outright disappearance. "Ordinary investors often see only the amplified returns but underestimate tail risks and liquidity risks, and they lack professional stop-loss or hedging capabilities," Tian emphasized. He stated that leveraged precious metals trading is a risk tool for professional investors, not a wealth management vehicle for the general public. Once involved, investors face not just market volatility but also systemic harm from opaque platform practices and rule uncertainties.

With individual leveraged gold channels gradually closing, how should ordinary investors build a steady gold allocation strategy? Xue Hongyan suggested that tighter leveraged gold channels do not preclude gold investment. For residents with average risk tolerance and long-term allocation goals, options include bank gold accumulation plans, gold ETFs and their feeder funds, or purchasing investment-grade gold bars through legitimate channels. "Regardless of the method, investors should use their own idle funds, treat gold as a diversification tool to spread asset risk, and avoid borrowing to invest, chasing rallies, or concentrating allocations," he advised. Tian Lihui recommended that ordinary investors adhere to principles of no leverage, standardized products, and long-term allocation. "On-exchange options like gold ETFs and feeder funds offer low fees and good liquidity, suitable for regular investment plans; bank gold accumulation plans feature low entry thresholds, incremental buying, and flexible redemption, fitting long-term small-scale savings; physical gold bars suit long-term holding but entail storage and liquidity costs," he explained. He reminded the public to view gold as a stabilizer within a portfolio, not a short-term arbitrage instrument.