Kieran Maguire makes new ‘exorbitant’ West Brom admission
Football finance expert Kieran Maguire has labelled the interest rates on potential loans at West Brom as “exorbitant.”
The Baggies parent company took out a £2million loan from Warmfront Holdings earlier in 2023, before immediately loaning that same amount of money to another company at a lower rate of interest [Kieran Maguire, 6 April].
Discussing the nature of clubs receiving loans from outside companies and whether or not it is a safe process, Maguire explained the nature of the Baggies’ loan immediately after discussing the “clown-show years” that saw Bolton Wanderers enter financial trouble.
Speaking on The Price of Football [25 September] Mature said: “We’ve got West Bromwich Albion who have borrowed from a company called Warmfront Holdings and they’re paying interest on that loan. Presently assuming the loan has not been repaid at five per cent a month
“If you compound that, that works out at 77 per cent interest a year. That is into the realm of loan sharking in terms of the rates. It also potentially reflects the degree of risk that lenders would give to an institution of West Bromwich Albion under the ownership of Guochuan Lai which is a separate issue.
“West Brom is in a fairly precarious position. So there is regulation in relation to certain types of borrowing from football clubs, but it’s still possible to borrow from the owner or third parties at exorbitant rates.”
Worrying
When discussing the business aspects of football clubs, there are a few names that you don’t want to fall alongside and one of the top names on that list will be Ken Anderson’s Bolton Wanderers, but worryingly that’s exactly where West Brom sit currently.
Anderson and Bolton’s loan from Sports Shield was only at an interest rate of four per cent, compared to the Baggies five per cent and it is a demonstration of just how financially reckless those in charge at The Hawthorns are currently being.
If this continues, West Brom’s financial and footballing future could be dragged into an incredibly worrying place that could spell danger for everyone associated with the Albion.
Conservative MP Nicola Richards has already spoken about her conversations with Sports Minister Stuart Andrew to discuss how an independent regulator could help clubs like the Baggies [12 September].
But currently, the asking price to secure a Baggies takeover sits at £50million and given the financial uncertainty at The Hawthorns, there won’t be many people willing to pay that sort of fee, despite interest from the United States and the Middle East [Daily Mail, 20 September].
Something needs to happen quickly to stop this spiralling even further out of control.
In other West Brom news, Alex Palmer has revealed his pride at playing for the Baggies as he looks to make history