NBD introduces gold savings certificates

National Bank of Dubai has issued gold savings certificates in paper format to offer customers a convenient way to balance their portfolios.

This is the first time in the Middle East a bank is offering customers opportunity to invest in gold products without the need to physically buy or store the precious metal. Since gold rises in value as the US dollar falls, it represents an opportunity to offset other investment products, NBD said.

With an increasing number of the UAE population investing in the gold and jewellery, the commodity is considered an integral part of economic life.

"NBD is a pioneer of investment products and our customers demand innovative solutions that help minimise risk and manage their portfolios," said R. Douglas Dowie, general manager of the bank.

Customers will be able to buy certificates in 500gm or 10kg denominations with a one-off fee of Dh50 and an annual storage charge of 0.30 per cent. They will be issued for five years from the date of purchase and customers will be able to redeem their investment at any time, in either gold bars or cash.

"The certificate can be used as a hedging instrument and a risk diversifier. The launch of the gold savings certificate in association with the World Gold Council will give investors who have a keen interest in gold a new product offering to satisfy their needs," said Moaz Barakat, World Gold Council managing director for Middle East, Turkey and Pakistan.