The Royal Bank of Scotland has issued a letter to Liverpool fans who have been urging them not to allow a new re-financing deal to the club’s co-owners Tom Hicks and George Gillett.
Liverpool FC owed the Royal Bank of Scotland and American bank Wachovia a combined total of £350million, including the loan used to purchase the club in February 2007.
The current loan deal has an expiry date of July 24th, however it now looks ever more likely that a new deal will be made.
Recently, outraged fans have protested against the RBS, pleading with them not to extend the loan to the American tycoons.
But RBS responded today with this statement:
‘œIn our view and that of the executive management of the club, it is financially healthy and able to service comfortably its debt obligations from cash flow generated by its playing and commercial activities.
‘œIt is in our commercial interest to support the club’¦ so that it can continue to perform successfully on and off the pitch.
‘œRBS is the main banker to the club including all of its operating accounts, cash management, online banking, automated payments, and credit card processing to facilitate ticket sales and retail merchandising.
‘œWe also lent money to the club’s parent, Kop Football Limited, so that it could repay debt which was on the balance sheet of the club at the time of its acquisition by George Gillett and Tom Hicks.
‘œThis is the only portion of Kop Football’s bank debt for which the Club is legally responsible. We took great care when making our original loan in early 2007 and when refinancing it last January to distinguish between obligations of the Club, primarily those outlined above, and obligations of its parent company, the latter being secured by personal guarantees and collateral from the owners and a pledge of the shares they own in the Club.’
Kop Holdings pay over £35million a year on the loan every year.
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