Skip to main content
gambling

A croupier sits at a baccarat gaming table at the Sands Cotai Central in Macau Thursday, Sept. 20, 2012.The Associated Press

Casino stocks dove after the South China Morning Post reported that China is cutting in half the amount of money China UnionPay Co.'s account holders can withdraw from ATMs in Macau, the world's largest gambling market.

The limit imposed by the Monetary Authority of Macau takes effect Saturday, cutting the withdrawal limit to 5,000 patacas ($626), the newspaper reported. Shares of Wynn Resorts Ltd. fell as much as 12 per cent, Las Vegas Sands Corp. dropped 14 per cent and MGM Resorts International sank 7 per cent. Melco Crown Entertainment Ltd. plunged as much as 17 per cent. Las Vegas Sands declined to comment, while other casino operators didn't immediately respond to requests for comment.

China has been tightening its capital controls as depreciation pressure builds on the yuan. The measures have included a pause on some foreign acquisitions and bigger administrative hurdles to taking yuan overseas, people familiar with the steps have told Bloomberg News.

The limit on withdrawals in Macau is designed to further tighten rules on the use of UnionPay, the Morning Post said. Law enforcement officials have scrutinized UnionPay transactions as a way for people to illegally take cash out of China.

The development strikes a blow to casino operators just as the Chinese betting enclave of Macau was starting to recover. Betting in the world's largest gambling market, the only part of China where casino gambling is legal, had risen for the past three months, emerging from a two-year slump. Almost a million Chinese tourists visited the former Portuguese enclave in the first seven days of October for Golden Week, the most in at least a decade.

Macau's government began restricting UnionPay debit cards in 2014, ordering jewelry shops and pawnshops on casino floors to remove the company's card terminals. Four people were arrested in the gambling enclave last year on suspicion of illegally using altered UnionPay terminals to obtain cash for clients. In Hong Kong, UnionPay account holders were blocked in October from using their cards to buy insurance, which gave them another potential way to move money overseas by swiping the cards multiple times.

Macau is in the midst of a surge in new casino construction, with new billion-dollar resorts popping up that target casual gamblers instead of the high rollers that form the bulk of its gambling customers.

Wynn opened its most expensive casino in Macau, the $4.2-billion Wynn Palace, in August. Sheldon Adelson's Las Vegas Sands opened the $2.9-billion Parisian Macau in September, and MGM is planning to open the $3.1-billion MGM Cotai next year.

This content appears as provided to The Globe by the originating wire service. It has not been edited by Globe staff.

Report an error