The Unicaja Foundation has announced that it will considerably reduce its funding of the basketball club of the same name based in Malaga. The group’s president, Braulio Medel, said on Monday that the foundation’s trustees had come to a unanimous decision to reduce its grant to the club to just over 600,000 euros a season - only enough to fund the academy’s activities, leaving the first-team facing a bleak future.
This comes as a huge blow to the basketball team, even though the Unicaja bank itself will continue to provide 3.5 million euros for the team annually. This means that the club will now be more reliant on other sources of income, such as membership fees, ticket sales, advertising and television money. In essence, the decision puts the club’s plans for the future in jeopardy and could create difficulties in fulfilling player contracts, many of which run for multiple seasons.
President offers resignation
The board of directors was only informed of the decision on Monday, with club president Eduardo García soon offering his resignation. Further departures could take place in the coming days.
For context, Fundación Bancaria is the majority shareholder of Unicaja bank. But due to the pandemic, the European Central Bank recommended that banks should not distribute dividends, meaning that the foundation did not receive money from the bank. This created problems during lockdown as the club struggled to pay its players’ salaries. At that point, the bank took charge and funded the entirety of this season’s budget of 9.5 million euros.
Despite taking into account the sporting and social role the Unicaja club plays in the city, the decision to end financial support was unanimous. This has created discontent among some club employees, who say they were unaware of the impact the decision would have. One member of the board of trustees was critical that “such an important decision had been taken without any debate being held”.
A spokesperson for the foundation said that, in these challenging times, difficult decisions had to be made on where the group could invest money.
All of this creates a very uncertain future for the Malaga club, who have already made significant budget cuts. During the 2006-07 season, in which they reached the EuroLeague semi-finals, their budget had been 18.5 million euros.