Fallen Russian giants Dynamo Moscow face financial crisis

Years of spending and little success has left Dynamo Moscow with a debt of 13 billion rubles ($200 million).

By: AP | Moscow | Updated: November 21, 2016 10:23 pm
russian football, dynamo moscow, dynamo moscow cash crunch, dynamo moscow crisis, dynamo moscow russia, russian football clubs, football news, sports news Chants echoed around the mostly-empty stadium in a pale imitation of Dynamo’s fierce rivalry with Zenit, traditionally a major security risk given the animosity between the fans. (Source: AP)

It’s been the team of KGB spies, goalkeeping great Lev Yashin and Putin-era state capitalists. Despite its rich history, though, Dynamo Moscow is in deep trouble.

Only a few thousand fans braved freezing temperatures to watch Saturday’s drab 0-0 draw against the Zenit St. Petersburg reserve team in the Russian second division. Chants echoed around the mostly-empty stadium in a pale imitation of Dynamo’s fierce rivalry with Zenit, traditionally a major security risk given the animosity between the fans.

Until a humbling relegation this year, Dynamo had never dropped out of the Soviet or Russian top division. And for much of its 93-year history, the very idea was impossible given Dynamo’s powerful political protectors, such as Stalin’s right-hand man and secret police chief Lavrenty Beria. On the field, Dynamo was renowned for the goalkeeping skills of Yashin – the “Black Spider” – and the innovative “passovotchka” short-passing style of the post-war years, a prelude to modern tiki-taka.

The collapse of the Soviet Union curtailed Dynamo’s clout, and a solitary Russian Cup title in 1995 has been the only consolation for the 11-time Soviet champions. Still, Dynamo often remained in touching distance of a title, buoyed in recent years by a flood of cash from the state-owned VTB bank.

VTB is now in the process of pulling out after years of big spending and few successes, leaving behind debts estimated by Dynamo general director Evgeny Muravyev at 13 billion rubles ($200 million). For a club with small crowds and minimal TV revenue, that’s a daunting sum.

Muravyev told Russian agency R-Sport this month that Dynamo is trying to pay off some debts and restructure others but “new obligations are piling up related to the fact that we don’t have many sources of funding at the moment. We’re not in a great state financially.”

The cash crisis is serious enough that the government has issued a declaration that it won’t allow Dynamo to die.

Until recently, Dynamo had been notorious for overspending in the transfer market. After Portugal reached the final of the 2004 European Championship, Dynamo swiftly signed seven Portuguese players, most of whom made little impact, as did former Germany striker Kevin Kuranyi, signed in 2010 for a reported 6 million euros ($6.4 million) a year. All that spending created vast losses, attracting a financial fair play sanction last year from UEFA which barred Dynamo from European competition.

A spending plan published by the club earlier this year shows more unusual spending for a struggling club, with $93,000 earmarked in January for a mascot which has yet to appear and up to $140,000 per game budgeted for VIP travel packages.

It’s not clear, however, how much was spent.

Still, not all is lost for Dynamo. The draw against the Zenit reserves ensured that it will go into the winter break in the promotion places. But even if Dynamo makes it back to the Russian Premier League, it will not be the same free-spending Dynamo as before, and wary of repeating the fate of another famed Moscow club, Torpedo, now toiling in the third division after repeated financial problems.