LONDON (Reuters) - Goldman Sachs Group GS.N is among around five bidders for ScotiaMocatta, the metals trading arm of Canada's Bank of Nova Scotia BNS.TO, for which it is seeking up to $1 billion, sources with knowledge of the matter told Reuters.

FILE PHOTO: The logo of Goldman Sachs is displayed in their office located in Sydney, Australia, May 18, 2016. REUTERS/David Gray/File Photo - RC19970BB830

Scotiabank began a review of its ScotiaMocatta metals business in 2016 following a string of lawsuits related to the manipulation of gold and silver price benchmarks and due to dissatisfaction over its performance, sources said.

It has since hired JPMorgan in New York to help with the sale process, with the aim of completion before the end of March 2018, they added.

The bulk of ScotiaMocatta’s business is in precious metals and it is one of five banks that clear bullion in London’s $5 trillion a year gold market, the world’s biggest.

Goldman Sachs has been seeking to turn around its struggling commodities unit by hiring a number of executives after reporting the weakest commodities results in its history as a public company in the second quarter.

Goldman and four other banks were part of a group that invested several million dollars in designing and building gold and silver contracts launched by the London Metal Exchange in July.

Three sources said Goldman had put in a non-binding bid for Scotiabank’s metals unit at an auction in mid-November.

“Taking the opposite approach to any other bank, which would scale back after a tough 18 months period ... Goldman is keen across all the commodity business to expand their physical franchise and wants to be aggressive on market share and pricing to expand their position,” one of the sources said.

Two of the sources said other bidders included Japanese trading house Sumitomo 8053.T and Australian bank ANZ (Australia and New Zealand Banking Group) ANZ.AX. The unit also attracted the interest of two Chinese banks, they said.

Scotiabank, Goldman and ANZ declined to comment. Sumitomo was not immediately available to comment.

ScotiaMocatta is one of London's main gold trading banks with a history dating back to the 17th century. It was acquired by Scotiabank from Standard Chartered STAN.L in 1997 and employs more than 160 people in 10 offices around the world, according to its website.

Market sources put Scotiabank’s annual revenues from the precious metals unit at $100-$180 million with operating margins of around 25 percent.

Sources said Scotiabank was seeking up to $1 billion for ScotiaMocatta.

“A factor in the discussions is whether the buyer gets an indemnity for legal risks as Scotia still has litigation hanging over them,” one source said.

“The purchase price will be affected by whether the buyer assumes that risk or they manage to ring-fence it or leave it with Scotia,” the source added.

U.S. investors sued Scotiabank alongside other four banks in 2014, claiming that they conspired to fix gold prices from 2004 to 2013,

A separate suit was pursued by silver investors against banks including Scotiabank.

Deutsche Bank DBKGn.DE agreed to pay a combined $98 million settlement on both suits.

The cases are only some of the lawsuits in which investors accused banks of conspiring to rig rates and prices in financial and commodities markets following revelations in 2012 that the London Interbank Offered Rate (Libor) had been rigged by British banks.