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.
City filed their latest set of accounts over the weekend to reveal money owed had been cut from £63m to £50m during the 2018-19 campaign.
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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