Macau’s central bank to clarify policy after casino shares tumble
The Monetary Authority of Macau said on Friday it would clarify its policy after a report that the gambling mecca would limit certain ATM withdrawals sent casino shares tumbling.
The selloff's trigger was a South China Morning Post report that the special administrative region (SAR) was planning to enforce a daily ATM withdrawal limit cut from 10,000 to 5,000 patacas (or about $1,250 to $626) by China UnionPay customers.
This will take effect on Saturday, the SCMP reported, after a finding that 10 billion patacas in China UnionPay ATM withdrawals were made in one month alone.
The Monetary Authority of Macau told CNBC it would issue a statement later on Friday to clarify matters.
Separately, China UnionPay, the mainland's largest bank-card issuer, said in a statement, initially cited by Reuters, that it had not changed its policy on overseas withdrawal limits for mainland-issued cards, which were set at 10,000 yuan ($1,449) a day.
The reaction for shares of listed casino companies was stark. Wynn Macau (Hong Kong Stock Exchange: 1128-HK) fell 7.8 percent, Sands China (Hong Kong Stock Exchange: 1928-HK) dropped 6.4 percent, Melco International (Hong Kong Stock Exchange: 200-HK) plunged 8.79 percent and Galaxy (Hong Kong Stock Exchange: 27-HK) shed 6.37 percent by 11:44 a.m. HK/SIN. That followed losses of as much as 10 percent in their U.S.-listed counterparts overnight.
Alex Bumazhny, senior director of gaming, lodging and leisure at Fitch Ratings, told CNBC's "Squawk Box" on Friday that it would be hard to determine how casinos would be impacted by the restrictions.
While he noted that the government has previously issued other restrictions on UnionPay machines, it would be difficult to parse the hit from the new measures from other factors affecting the market, such as the mainland's corruption crackdown and its general economic fundamentals.
He added that players have managed to work around previous restrictions as well.
"This may actually impact revenues and we may have to reassess our forecasts for 2017, but it's just so hard to determine at this point. This really will impact the mass market, which is really where the growth will be coming from," he said, noting that the mass-market segment makes up about 50 percent of the total market.
"The VIP players will still continue to get their money from junkets, from the casinos as credit so this really will impact the best part of the market, the mass market."
—Rachel Cao and Jeff Daniels contributed to this article.
—By CNBC.Com's Leslie Shaffer; Follow her on Twitter @LeslieShaffer1
Follow CNBC International on Twitter and Facebook.
More From CNBC
