Halister News

(Bloomberg) -- Macau casino operators, including 4-U.S. listed names (Wynn Resorts, MGM, Las Vegas Sands, Melco Resorts), as well as those listed in Hong Kong (Wynn Macau, Sands China, MGM China, Galaxy, SJM) may come under pressure after one of Macau’s largest junket operators warned customers, key staff of "liquidity channel impairment, advised clients to withdraw money from affected bank accounts," Daiwa analyst Jamie Soo writes in note.

• Junket operator memo highlighted increased enforcement of anti- money laundering initiatives in both China and Macau, Soo said, citing channel checks
  • Enforcement actions included large-scale investigations into questionable money transfers, freezing of numerous bank accounts
• Soo believes move likely followed "impairment of the junket’s affiliated cross-border funding channels such as underground banks"
• View of expected further heightening of enforcement "continues to be reaffirmed given the events we have witnessed over the past six months"
• View on sector is neutral, with Sands China the only buy-rated stock
• LVS drops 2.3% pre-market; WYNN, MLCO, MGM haven’t traded
• NOTE: July 13, Gaming-related crime situation in Macau remains “serious”, the director of Judiciary Police Chau Wai Kuong said in a speech on Wednesday: GGR Asia website
  • Chau said police have strengthened patrols, have seen "increase in the number of cases of unlawful detention related to loan-sharking operations”
• NOTE: July 3, Macau gaming shares may move as UnionPay cardholders can only get cash at ATMs installed with facial-recognition software in Macau from July 4
• NOTE: July 2, Macau Casino Revenue Growth Misses as Xi Visits HK: Street Wrap

To contact the reporters on this story: Janet Freund in New York at jfreund11@bloomberg.net; Daniela Wei in Hong Kong at jwei74@bloomberg.net To contact the editors responsible for this story: Arie Shapira at ashapira3@bloomberg.net Janet Freund