NEW YORK (
said Friday that it will explore the sale of its physical commodities business.
Other strategic alternatives include a spin-off or a strategic partnership.
During the process, it will continue to operate the business as a going concern. The bank also remains committed to traditional activities in the commodities market, including financial derivatives and the vaulting and trading of precious metals, it said.
The Commodities Futures and Trading Commission (CFTC) recently began a probe on Wall Street's role in the metals warehousing business following complaints that banks and traders are distorting supplies and artificially inflating prices.
Last week, the
said it was reviewing a 2003 decision that allowed banks to trade in physical commodities markets.
Wall Street's role in the warehousing of physical commodities has attracted scrutiny in the past week after
The New York Times
was profiting from the warehousing of aluminum. JPMorgan, it said, had made equally deep forays into the copper market.
Since 2010, four of the six largest warehouses at the London Metal Exchange have been bought by investment banks or traders, according to a
-- Written by Shanthi Bharatwaj in New York.
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