Finance

€190m wage cut, or bankruptcy - Barcelona's precarious financial situation

The coronavirus crisis has decimated the club's finances and there must be a drastic reduction or else severe consequences

 
5:15pm on Monday 2nd November 2020
By
Paul Macdonald

Barcelona are amidst a financial crisis.

The board must find €190m in the next week in order to stave off bankruptcy threats and moves are in place to find the funds from the first-team playing squad.

The players have been in consultation over a projected 30% pay cut across the board in order to ensure that the future of the club in its current form is secured for the remainder of the season.

Managing Committee Chairman Carles Tusquets said of the situation: “Our main concern is the cub's finances.

"The pandemic has affected Barcelona particularly hard. The club depends on tourism and now, all of that income has been lost; the situation is not very comfortable, we have to take on the ideas of the previous board to find a way of addressing the problems we are facing."

READ MORE:

Champions League Team of the Week: Hat-trick off the bench for Rashford

Barcelona: Squad, FC Ratings, Matches, Formations

2020/21 Champions League: Groups, Matches, Team Stats, Player Stats

Barcelona bankruptcy

How could Barcelona have possibly reached this point?

1) Coronavirus losses

Barca have lost a secure, regular income stream from visitors to the city buying merchandise and visiting the stadium. All of that is gone.

Furthermore, the broadcasting revenue has been reduced, and the gate receipts have been reduced to effectively zero, while it remains abundantly unclear where any fans will be allowed back in.

Both of these ongoing developments have left Barca with a gaping hole in their finances, despite topping the Deloitte Rich List for 2019.

2) Huge salaries

The reason why the squad have been targeted for a reduction in salary is because many of them are on huge sums of money, not least Lionel Messi, who, it is reported, collects in the region of €1m per week from the club before bonuses or image rights.

Luis Suarez, Ivan Rakitic and Arturo Vidal were already allowed to leave to remove them from the wage bill, but it's simply not enough. The cuts must go deeper, and harder, or else more serious ramifications will be felt.

3) Transfer mismanagement

Despite receiving €220m for Neymar, the club's transfer activities across the past five years is nothing short of disastrous. Numerous deals haven't worked out, and players have been purchased at a premium, while others were sold for a discount.

Barcelona's transfers - breaking down every bad deal as 1Bn is wasted

Ousmane Dembele, Philippe Coutinho and Antoine Griezmann cost in the region of 400m between them and none of them have provided any tangible performances on the pitch. It is this gross layout, as well as some of the smaller deals, which have led to this moment.

Latest news

Predicted XI

Rotation from Lampard? How Chelsea could line-up against Sevilla

The Blues have already secured qualification for the next round, but top spot is still up for grabs against the Spanish side

  • 13 minutes
Predicted XI

De Jong in defence? How Barcelona could line-up against Ferencvaros

The Blaugrana are currently in the middle of a personnel crisis at the back and could be forced to play the Dutchman as a centre-back

  • 27 minutes
Champions League

Neymar back, De Gea out? - How Man United and PSG could line-up in the Champions League

Manchester United manager Ole Gunnar Solskjaer will have to contend with a fully-fit PSG side and injury concerns of his own.

  • 38 minutes
Champions League

Stephanie Frappart: The history-making ref who will lead Juve v Dynamo Kyiv

Stephanie Frappart will become the first female to referee a male Champions League match on Wednesday - and her appointment has been achieved purely on merit.

  • 13 hours
Premier League

Ederson and Klopp back calls for concussion substitutions

There should be more leeway for clubs to make substitutions for players suffering potentially serious head injuries, Ederson and Jurgen Klopp have argued.

  • 14 hours
La Liga

Atletico Madrid reach nearly A BILLION euros in debt

The Spanish giants are recording major revenue losses with debt continuing to escalate.

  • 19 hours

Most read