Macau: Concern Over Crackdown Sends Shares at Casinos Falling
The largest gambling hub in the world, Macau moved Friday to clarify it did not tightened the daily withdrawals limits of cash for gamblers from China, after fears of a big crackdown on illicit outflows of money sent shares tumbling for casino operators.
An English language newspaper in China citing a source in the finance industry, reported on Thursday that China’s Monetary Authority of Macau would cut in half the amount in cash that cardholders of China UnionPay could withdraw from any territorial automated teller machine or ATM.
The daily said that crackdown would mean cutting the daily cap in half for clients of the largest provider of bankcards in China to $626 or 5,000 patacas.
The authority in Macau however said that withdrawals had been limited for each transaction to 5,000 patacas starting on Friday, but the daily limit had not been changed.
The international arm of UnionPay also announced that it did not change policy on cash withdrawals overseas using cards that were issued from the mainland saying the daily limit remained 10,000 yuan or $1,450, with a cap for the year of 100,000 yuan.
Withdrawals at ATMs are not a big source of cash for the majority of gamblers from China, especially for those who are high rollers.
Many of the average players use UnionPay to purchase goods, and then return them for a refund in cash, which in turn gets used for gambling.
However, the change reported was looked at as a signal of worry, alarming investors still in a recovering mode from a long running campaign of anti-graft under the current central government led by President Jinping.
Revenues for the month from Macau started showing growth since August, aided by more resorts bringing in the casual gambler.
Shares of groups in the gaming industry such as Las Vegas Sands Corp, Wynn Resorts and Melco Crown Entertainment were down by over 10% on concerns over a crackdown.
China is increasing measures to stop the outflows of capital and analysts that brushed off limited action on Friday from Macau, warned that a broader concern still remained.
The risk of additional control measures on capital outflow cannot be ignored, said an analyst on Wall Street, noting it could limit the recovery in revenues from gaming during 2017.
In many locations it looked like business as usual at Macau casinos on Friday, as the gamblers and the business owners did not let the prospect of the withdrawal limits of cash spook them like it did investors.
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