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Vault-to-Vault Transfer

A vault-to-vault transfer is the controlled relocation of physical bullion between two accredited storage facilities while maintaining verified ownership and continuous custody.
It enables institutions to optimize logistics, settlement, and jurisdictional positioning of gold holdings without breaking the chain of custody or compromising audit integrity.

Vault-to-vault transfers form a key component of institutional bullion operations, connecting global storage networks across London, Zurich, Dubai, Hong Kong, and Singapore.

Definition and Purpose

A vault-to-vault transfer involves the physical movement of gold bars from one authorized vault to another, typically between custodians, sub-custodians, or institutional clients.
The process is used to:

  • Reposition holdings closer to counterparties or regional markets;
  • Consolidate or segregate reserves across jurisdictions;
  • Facilitate delivery under settlement agreements;
  • Support collateralization or reallocation of custody accounts.

Each transfer must preserve legal continuity of ownership — meaning the metal remains under the control of a regulated custodian throughout the entire process.

Custody Chain and Documentation

The transfer is initiated through a Vault Transfer Instruction (VTI) issued by the asset owner or custodian.
Documentation typically includes:

  • A detailed barlist specifying serial numbers, weights, and fineness;
  • Transfer order defining the origin and destination vaults;
  • Insurance certificate confirming continuous all-risk coverage;
  • Transport manifest and airway bill (if moved across borders);
  • Reconciliation statement upon delivery and re-entry into custody.

Both vaults — the dispatching and receiving — must acknowledge the transaction and provide signed confirmation of delivery.
Digital records are synchronized between custodians, ensuring that the bar’s serial number and ownership record remain traceable and unbroken.

Logistics and Security Protocols

Physical movement is executed by licensed secure logistics providers, such as Brinks, Ferrari Group, or Loomis International.
The bullion is sealed in tamper-evident containers, transported via dedicated vehicles or air cargo, and accompanied by armed security or bonded courier staff.

Core safeguards include:

  • Dual-control handover between vault and carrier;
  • GPS tracking and route monitoring;
  • Customs documentation and clearance where required;
  • Continuous insurance coverage during transit;
  • Verification and weighing upon arrival at the receiving vault.

The gold never leaves the regulated custody environment, ensuring compliance with both AML and trade regulations.

Accounting and Settlement Treatment

In institutional accounting, vault-to-vault transfers are treated as asset relocations, not asset disposals.
The transaction does not affect valuation or ownership unless the transfer coincides with a change of beneficiary under a settlement contract.
Settlement instructions may authorize delivery “vault-to-vault” as final discharge of an obligation between two counterparties, replacing the need for physical collection or re-minting.

All reconciliations are reflected in the custody ledger and verified by internal or external auditors.

Regulatory and Compliance Framework

Vault transfers between LBMA-accredited facilities follow the Good Delivery Rules and LPMCL clearing procedures.
Cross-border transfers comply with customs declarations, export licenses, and OECD due diligence standards on responsible sourcing.

Custodians maintain full audit trails of movement, ownership, and insurance continuity.
FATF AML/KYC and sanctions-screening requirements apply to all counterparties involved in the transaction.

Institutional Role

Vault-to-vault transfers enable the global circulation of physical gold within a transparent and regulated system.
They allow financial institutions to realign reserves, settle trades, or respond to geopolitical and liquidity shifts while retaining auditability and insurance protection.
In practice, this mechanism ensures that every bar held within the global custody network remains both physically traceable and legally accountable, regardless of where it is stored.

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