Nobody noticed, but casinos in tiny Macau passed a new milestone: third-quarter revenue from VIP baccarat tables alone hit 13.668 billion patacas or US$1.738 billion, for the first time edging past the US$1.69 billion in total winnings at all the mega-resorts on the Las Vegas Strip.
This means you can forget the 11,510 slot machines and some 3,000 mass-market gaming tables that fill the glitzy and increasingly vast public areas of all the casinos in Macau; winnings from private, backroom high-roller salons have overtaken the 38 casinos and slot halls that line the iconic stretch of Las Vegas Boulevard in the US gaming capital.
Still, the joker's share of revenue in Macau's VIP segment doesn't go to the casinos. Instead it goes to the junket agents who bring in the high rollers, lend them money and collect gambling debts in exchange for commission on chip sales.
Junkets purchase chips from casinos with cash and lend them to players on credit and as the bankrollers of the gaming boom they have had to maintain increasingly deeper pockets. In the first nine months, VIP baccarat revenue soared 53 per cent to 38.875 billion patacas, accounting for 67 per cent of all casino winnings.
Keeping high rollers rolling is expensive. As a result, junkets are turning to the Hong Kong stock market for funds.
This year, firms including Dore Holdings, China Star Entertainment and Neptune Group have paid nearly HK$5 billion to Macau junkets at the Sands Macao, Wynn Macau, Venetian Macao, Grand Lisboa and Galaxy Starworld casinos in exchange for stakes in the profit from their gaming operations. The junkets use the windfall to finance their operations and buy more chips from the casinos.