Pawning UnionPay out of the casinos
There has been a lot of speculation that the Macau Government wants UnionPay retail outlets off the casino floors. When the UnionPay issue surfaced last month we had heard that a couple of casinos moved those shops in to lobby and mall areas. Recently, Bloomberg reported that the Macau Monetary Authority (MMA) actually notified the shops individually that they need to move by July 1st. The only confirmation of this came from SJM CEO, Ambrose this week.
As you can see from the following chart, most of the big casinos maintained UnionPay retail outlets on their casino floors with the exception of Wynn Macau and MGM. SJM’s Grand Lisboa apparently removed the UnionPay logos from pawn shops located on the casino floor. It should be noted that Grand Lisboa offers a number of UnionPay options all around the casino. This should be the model going forward.
Aside from the minor inconvenience, there shouldn’t be a major impact to the casinos’ GGR should the pawn shops be forced off the casino floor. Wynn Macau and MGM should experience no impact, presumably. Plenty of UnionPay options will remain and unless the MMA forces UnionPay completely out of the buildings, we see little sustainable impact from the rumored restrictions. We believe the likelihood of a UnionPay ban altogether as very unlikely.