Singapore Casinos Not Harmed by Recent Money-Laundering Scandal
LISTEN TO THIS ARTICLE:The recent high-profile money laundering case that saw Singapore authorities seize over SG$2.8 billion (US$2.1 billion) in cash, cryptocurrencies and other assets has failed to have any discernible impact on the country's casinos. Despite initial concerns that the case might lead to a decline in high-roller activity, a Maybank analyst's note revealed that Genting Singapore, operator of Resorts World Sentosa (RWS), has not experienced the anticipated fallout.
Resorts World Sentosa Recovers
The revelation comes in the wake of Genting Singapore witnessing a 13% dip in its share price since the money laundering case made headlines. Investors were apprehensive that the incident might prompt high-profile individuals, particularly VIPs, to steer clear of casinos. However, Maybank analyst Samuel Yin Shao Yang, in a note published on Wednesday, asserted that the feared decline in casino patronage has not materialized.
According to Yang's findings, discussions with Genting Singapore indicate that both VIP and mass market gaming segments are not only resilient but also showing signs of growth. Contrary to market anxieties, Genting Singapore's VIP volume is expected to stabilize at 87% of 2019 levels by the end of this year. Moreover, the mass market gross gaming revenue (GGR) is projected to reach 105% before witnessing a further uptick to 120% in 2024.
Despite the severity of the case and its potential to impact the gaming industry, Genting Singapore's robust performance indicates a certain level of resilience. The company's ability to weather the storm is attributed to the stability of both VIP and mass market gaming, defying expectations that the money laundering scandal would deter high-value players.
Money Laundering Scandal Continues
The money laundering case, which unfolded in mid-August, involved the arrest of 10 individuals with alleged links to forgery, money laundering and resistance to lawful apprehension. The group, comprised of members holding passports from China, Cambodia, Cyprus, Turkey and Vanuatu, was found to be associated with illegal online gaming sites catering primarily to customers in mainland China.
The ongoing investigations involve multiple entities, including the Singapore Monetary Authority, banks and real estate developers. Transactions worth millions of dollars are now under scrutiny, possibly bringing to an end the country's rapid growth as a safe haven for the wealthy.
As Singaporean authorities continue their investigations, the casino industry's ability to remain largely unaffected raises questions about the overall resilience and regulatory strength of the country's gaming sector. The Maybank analyst's optimistic outlook for Genting Singapore's gaming segments suggests that, despite external challenges, the allure of the country's casinos remains intact, paving the way for continued growth in the coming years.
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