Our investment strategy on industrial metals
Beyond precious metals, the bank now accepts tokenized industrial metals and commodities as collateral, and deploys its own treasury strategy on these assets. Here, in full transparency, is how it works and the action plan being followed.
Target of the bank's own treasury strategy on these assets, not a guarantee, and with no effect on the calculation of your credit. The automatic repayment of your credit remains the one described above: the real appreciation of your collateral, capped at 60%.
Cash & Carry Arbitrage
Buying the tokenized metal on the spot market, simultaneously selling an equivalent futures contract: the position is neutral to price risk and captures the financing spread (contango).
Collateralization & triangular lending
The tokenized metal is deposited as collateral (a prudent LTV, 50% maximum) with an institutional protocol, to borrow stablecoins reinvested in low-risk treasury funds.
Selected liquidity provision
A minority share of the capital feeds targeted liquidity pools, earning a share of the transaction fees paid by market participants.
How these figures are obtained
Illustrative example of a $10M treasury deployment on Platinum, at the scale of the bank, not of your individual collateral.
| Flow | Basis of calculation | Annual amount | Impact |
|---|---|---|---|
| Native yield on Platinum (physical appreciation) | 1.5% on $10M | +150 000 $ | +1,50% |
| Basis trade / contango on futures | 3.5% on $10M | +350 000 $ | +3,50% |
| Yield on invested borrowed stablecoins (BUIDL) | 5.0% on $5M | +250 000 $ | +2,50% |
| Cost of borrowing stablecoins | -3.2% on $5M | -160 000 $ | -1,60% |
| Operational costs, custody & insurance | 0.4% on $10M | -40 000 $ | -0,40% |
| Total net yield | $10M capital | +550 000 $ | +5,50% |
By reallocating a share of the treasury toward liquidity provision (Pillar C), this net yield can rise up to the 10.2% target, at the top of the 8 to 14% indicative range shown above, with no additional leverage and no guarantee of results.
12-month roadmap
Structuring & compliance
Legal framework, selection of licensed custodians, issuer audits.
Pilot project
$5M pilot allocation on Platinum, first arbitrage circuits.
Scale-up
Capital extended to $25M, expansion to Palladium and Copper.
Industrialisation
Real-time reporting and end-to-end accounting integration.
Identified risks & protective measures
Bimonthly Proof of Reserve audits by independent firms.
Exclusively multiple-audited protocols, covered by institutional insurance.
Direct redemption agreement with physical issuers, maximum 48-hour notice.
Strict over-collateralization ratio (LTV ≤ 50%) with automated rebalancing.
Governance & separation of funds
Capital committed
This strategy is run on the bank's own treasury, never on the assets deposited as collateral by clients. A client's collateral is used exclusively to secure their own credit (see Yield); it is never lent out or committed to the arbitrage or market making described above.
Supervision
Overseen by the Financial Markets Division, reported to the Investment Committee and Executive Management at every phase change (see roadmap above), with daily internal monitoring of actual performance against the indicative target shown.
Frequently asked questions
Is my collateral used for this strategy?
No. Your collateral remains exclusively allocated to your own credit. This strategy runs on the bank's own treasury, a separate pool of capital.
What happens if the strategy loses money?
The loss is absorbed by the bank's treasury, with no effect whatsoever on client accounts or on credit already granted: this risk is never transferred to the client.
Is the 8 to 14% target already met?
It's a medium-term target, not a month-by-month guaranteed result: see the case study above for a detailed example of the net yield calculation.
Why do only industrial metals have this target?
Gold, silver and ETH already benefit from the real automatic repayment described on the Yield page. This indicative target is specific to the treasury strategy on industrial assets, a separate and additional mechanism.