Safe deposit box provider says investors buying gold ‘to protect savings and pensions’

Merrion Vaults says demand for safe deposit boxes and gold surged in 2020

Co-founder of Merrion Vaults Seamus Fahy says clients are spending an average of between €7,000 and €10,000. Photograph: Mark Nixon

Co-founder of Merrion Vaults Seamus Fahy says clients are spending an average of between €7,000 and €10,000. Photograph: Mark Nixon

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Irish people are spending more on gold as they buy the precious metal to safeguard wealth against Covid-19’s economic impact, according to one major seller.

Gold sales by Irish business Merrion Vaults, which provides safe deposit boxes in Ireland and Britain, multiplied four times in 2020, the company said on Tuesday.

Seamus Fahy, Merrion’s co-founder, says clients are spending an average of between €7,000 and €10,000 as a result.

According to the company, experts say gold bullion sales continue to increase in Europe and throughout Ireland despite an all-time high price for the metal of $2,035 (€1,669) an ounce.

“Clients are buying gold to protect their savings and pensions,” Mr Fahy notes. He adds that Merrion is seeing this demand in the Republic as well as in Glasgow and Edinburgh in Scotland, and Newcastle and Liverpool in England, where Merrion has safe deposit box centres.

“Irish buyers like Krugerrands and single kilo bars. In the UK, gold sovereigns are very popular,” Mr Fahy says.

Merrion sources the gold for clients from its suppliers in return for a margin on the transaction. The company often provides safe deposit boxes to customers to store the gold.

Its customers bought about €20 million worth of gold last year, it is understood.

Overall demand for its safe deposit boxes also grew in 2020, pushing up turnover in Merrion’s core business by 20 per cent.

Expand further

This has prompted the company to expand further this year. It hopes to open a new safe deposit box centre in Barcelona in Spain shortly.

Merrion also plans centres in Belfast, as well as Bristol and Redding in England. The expansion will create about 35 jobs, the company predicts.

The company last year noticed a rise in the number of individuals and households storing valuables and heirlooms in safe deposit boxes.

“Research shows a rise in burglaries, many of them aggravated, in family homes and businesses,” says Mr Fahy.

“We are seeing more householders coming to us in all our outlets to store valuables and investments away from the home.”

He adds that companies and other organisations are also increasingly using safe deposit boxes to store confidential information off their premises, to comply with regulatory and insurance requirements.

A more recent trend is for investors to store bitcoin codes and information in Merrion’s boxes to keep them offline where they cannot be hacked.

The business is in talks with suppliers about allowing clients to use the cryptocurrency to buy gold, another trend that emerged in 2020.

Nervousness

Covid-19 followed a few years where nervousness sparked by political instability brought about by Brexit and other events also increased demand for safe deposit boxes.

Mr Fahy co-founded Merrion Vaults with colleague David Walsh in 2013 after finding it difficult to find such a service himself for his other business, Voltaire Diamonds, as banks no longer offer it.

It began with a facility in Dublin city centre and subsequently expanded into Britain.

Each centre features tough security with alarms and sensors monitored by local police. 

This article was edited on May 6th, 2021

* The Press Ombudsman has upheld a complaint made by Mr Alan Redd that The Irish Times breached Principle 1 (Truth and Accuracy) of the Code of Practice of the Press Council of Ireland. Other parts of the complaint were not upheld.

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