London Good Delivery - Silver

London Good Delivery - Silver

A primary function of the London Bullion Market Association (LBMA) is facilitating the international distribution and acceptability of their silver bars. Historically, members of the London bullion market compiled lists of accredited smelters and assayers whose silver bars they would accept without question in settlement against transactions conducted between each other and with acceptable counterparties.1

LBMA Good Delivery accreditation has become an internationally accepted standard of quality. Refiners of silver have to satisfy the Physical Committee of the LBMA that their bars meet the stringent requirements outlined in the “LBMA Good Delivery List.” For this reason, the on-going review and maintenance of this list is a core function of the LBMA. The assaying capabilities of refiners on the Good Delivery List are periodically checked under the LBMA’s Proactive Monitoring system.1

Good Delivery rules for refiners

Refiners wishing to apply for Good Delivery status submit applications to the LBMA Chief Executive, who in turn consult members of the Physical Committee to assess the refineries. The main requirements to be considered for listing are normally:2

  • The applicant has been in existence for not less than five years and has been involved in refining operations of the metal for which it is applying for Good Delivery status for not less than three years prior to the application
  • The applicant has an established annual refining production (which need not be in the form of standard bars) of not less than 30 tonnes of silver
  • The applicant has a tangible net worth of not less than the equivalent of £15 million or such figure as the LBMA may from time to time determine
  • The applicant’s ownership, financial standing and reputation would allow it to satisfy the KYC (Know Your Customer) tests practised in the London bullion market

Good Delivery rules for silver bars

Details of the specific standards required for inclusion on the LBMA Good Delivery List are published by the LBMA in the “Good Delivery Rules for Gold and Silver Bars,” available on the LBMA website.

Generally, to qualify as Good Delivery metal, silver bars must conform to the following specifications:2

  • Form: plate or ingot

  • Weight: maximum 1,100 troy ounces (approximately 34 kilograms), minimum 750 troy ounces (approximately 23 kilograms)
    • However, it is recommended that ideally refiners aim to produce bars within the following weight range: maximum 1,050 troy ounces (approximately 33 kilograms), minimum 900 troy ounces (approximately 29 kilograms)
    • Bars produced prior to January 1, 2008 having a weight in former weight range of 500 to 1,250 troy ounces is accepted, but will be eventually phased out6
  • Purity: the minimum acceptable fineness is 999.0 parts per thousand silver
  • Appearance: smooth, free from cavities, holes, or blisters and easy to handle
  • Markings (each plate or ingot must bear):
    • The assay stamp of refiner
    • Fineness (to three or four significant figures)
    • A serial number
    • Year of manufacture

Proactive Monitoring

In 2004 the LBMA introduced Proactive Monitoring, a system for monitoring the quality of the production and assaying ability of refiners on the Good Delivery list. Prior to its introduction, a refiner only had to demonstrate its refining and assaying ability at the time of its application for admission to the list.4 Currently, refiners on the List are monitored on a regular basis, helping to ensure that the most stringent requirements continue to be met – further enhancing the list’s reputation and that of the refiners on it.

Supervisors witness the dip-sampling operations that provide samples for testing by the LBMA’s referees. Apart from newly-listed refiners, refiners are subject to full monitoring once every three years.4 As of 1 January 2012 all current Good Delivery refiners are required to submit their production and audited financial data on an annual basis to the LBMA Chief Executive.2

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