THE region's top football clubs have seen up to £150m wiped off their stock market values after predicted increases in profitability failed to materialise.

Since 1997, Newcastle United has seen its value in the City fall from about £200m to £50.85m, while Sunderland's market worth fell from £61.3m to £37.44m.

Financial experts argue a major surge in interest in football clubs had come about due to predicted increases in revenue from such things as television deals and merchandise.

But, although the increase came about, Vinay Bedi, director at Newcastle stockbrokers Wise Speke, said profits had barely increased - partly because of a massive rise in players' wages.

"Not unexpectedly, the City began to think that those increased revenues would lead to increased profitability in football clubs," he said. "That hasn't proved to be the case.

"Increased revenues have been swallowed up, primarily through increased wage bills."

Mr Bedi said the City had lost faith in the clubs' abilities of managing their businesses, leading to the drop in values.

Even Manchester United has lost value on the stock market, but, having fallen from a reported £465m to £428.62m, it is still worth some £370m more than the second most valuable club, Chelsea.

Middlesbrough are one of the few clubs not to have floated, but Mr Bedi reckons Newcastle and Sunderland both have specific goals they need to aim for to increase their value.

He said Sunderland had shown good growth and report-ed promising figures recently.

But the club now needs to prove itself as a lasting force in the FA Carling Premiership, establish itself as "one of the elite", and keep performing on and off the field.

The club's chief executive, Hugh Roberts, agrees and a presentation was taken to the City last week to show how Sunderland had grown.

He said: "The City needs to see that the club can control that vital ratio, so the money doesn't go in the top and go straight out of the other end.

"The important thing is to get respect in the City."

As for Newcastle, Mr Bedi argues the club was one of the later teams to float on the market and it did so at a high price.

"Unfortunately, their management team has created credibility problems that David Stonehouse, the new chief executive, is trying desperately to correct," he said.

A spokesman for Newcastle United said it would be inappropriate to comment on the issue with its interim results due in the next few weeks