RBS Declares Liverpool Debt Toxic

It seems that the Hicks and Gillett
regime at Anfield is nearing its
inevitable conclusion.
A club that only 3 years ago had
around £15M of debt, is now
wading in around £400M of
debt. However it is the £260M+
debt that is owed to the Royal
Bank of Scotland that is likely to
cause the dissolution of the
American owners reign.
According to The Guardian,
Liverpool ’s loan has been
reclassified and moved in to it’s
Global Restructuring Group. This
group is effectively the ‘bad bank’
part of the organisation, created
to pile in all the toxic assets from
the recent worldwide financial
crisis.
The bank is in the unfortunate
position (for itself) of being
almost fully owned by the UK
taxpayer – meaning that ethically
and politically it can no longer
continue to milk Liverpool for
£1M almost every week in
interest payments, to enlarge a
loan it will never get back.
A number of bidders have
expressed interest in Liverpool FC
but have walked away from the
table as they believe the valuation
of the club to be too high. It now
looks highly unlikely that the
bank will once again extend
Liverpool FC ’s loan.
The Guardian cites a source at
the bank as saying:
“If it has been taken out of
the hands of the corporate
banking department they ’ll
have a much more ruthless
approach on 6 October. ”
RBS would then hope to
engineer a quick sale at a
reduced rate to ensure they get
as much of their loan back as
possible.
They could well enforce
administration on two of
Liverpool ’s parent companies (set
up by the owners as part of the
mysterious money flow) and also
George Gillett Jnr ’s Football UK –
another holding company.
If this second approach were to
happen the Premier League
would be left with no choice but
to hand Liverpool a 9 point
Premier League penalty
deduction – making the chance
of European CL qualification even
slimmer.
The storm clouds may continue
to gather but hopefully sooner or
later the crippling LFC debt will be
removed.
The Hicks and Gillett years at
Liverpool have brought shame
on the club, embarrassment to
the fans and everyone connected
with the club, created divisions
between sections of fans in how
to deal with the mess. In a couple
of months – Liverpool FC may
well, once again, be all about the
football.
Liverpool’s loan with RBS runs
out on October 6th.