Hull City have paid out almost £22m servicing the club’s debts in the last eight years, according to figures published during the Allam family’s reign as owners.
That brought a reduction in net interest paid from £2.6m to £1.8m, the lowest figure reported since 2010-11 but almost the same as spent on player recruitment during the 12-month period.
City’s debt levels have now been halved from the highest point of £100m in 2015-16 but those years in the red have come at a cost.
Since 2011-12, the first full season with Assem and Ehab Allam in charge, City have now paid out £21.9m in net interest.
The latest set of accounts offer no detail into the structure of interest paid on loans during 2018-19 but in both 2011-12 and 2012-13 it was reported that five per cent interest was paid on the parent company loan to Allamhouse. By 2014-15 that had been cut to four per cent.
The net interest paid by City last season accounted for 3.7 per cent of the club’s total income of £48.4m.
Neither Assem nor Ehab Allam have ever received a salary from City through a directors’ remuneration in their reign spanning almost nine years but their investment in the club has brought a yield.
“If you borrowed that money from a bank then it’s probably par for the course but as a rule banks are very reluctant to lend money to football clubs,” said Kieran Maguire, lecturer in football finance at the University of Liverpool.
Hull City's turnover since 2009-10
“The risks of relegation and the fact most Championship clubs are losing crazy sums of money mean lending to football clubs has risks.
“The alternative is interest-free loans from owners. If you look at Stoke City, they get interest-free loans. Huddersfield and Brighton have benefitted in the same way.
“Owners who put the money and don’t charge interest, that’s as good as it gets.”
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