Celtic will not be allowed to fall into the same financial turmoil which is currently enveloping Old Firm rivals Rangers, according to Parkhead chairman John Reid.

Reid and chief executive Peter Lawwell met shareholders at the club's AGM at Celtic Park on Friday morning, where they rejected accusations that failure to bolster the squad sufficiently in January had cost the club their fourth Clydesdale Bank Scottish Premier League title in succession.

Reid pointed to the troubles of their rivals, who are reportedly around £30million in debt and, according to boss Walter Smith, being run by the club's bankers Lloyds.

While Lloyds subsequently denied that claim, the search for a new owner continues at Ibrox.

Former Home Secretary Reid returned to darker financial days at Celtic Park 15 years ago as he discussed the issue of clubs in serious debt.

He said: "In the past week alone that could apply to Hull, Portsmouth and Rangers and in principle it could apply to the Royal Bank of Scotland, to anywhere else.

"That's why I say look around you, great institutions are falling apart or finding themselves in hock to others, from banks to commercial concerns and governments.

"You don't become dependant on a financial institution because you borrow some money from it.

"You become controlled by a financial institution and utterly dependant on it if your level of debt to that institution is greater than you can afford.

"You can't just borrow endless amounts of money to try and make up for the financial advantages that your competitors have.

"That way lies ruin.

"The vast majority of fans and shareholders know that.

"You have to make sure you don't fall in to the populist trap of trying to buy an easy ride for the next few months by selling the future of the club and that is what we won't do."

Reid added: "I think we ought to remember the video shown at the AGM, it showed Celtic 15 years ago on the bank of bankruptcy.

"The experience of being three hours from bankruptcy and administration, as we were in 1994, is something that those of us whose hearts belong to Celtic will never forget.

"That is what motivates us, not the fear of debt. We have learned our lesson in the past.

"If you spend money you don't have to such an extent that you get debts that you can't afford, then you lose control of your own destiny.

"This board is going to do everything we can to make sure that never happens again to Celtic."

While assuring manager Tony Mowbray that money will be available to strengthen the side in January, Lawwell concurred with Reid's ideas on fiscal frugality.

He said: "The objective of the club is that it remains under the custodianship of the people which holds the values and traditions.

"But we are flexible about the debt, it is not an obsession.

"If you do the right things elsewhere the debt looks after itself and we have proved that over the years.

"But we know what can happen when clubs actually go beyond that line.

"This week it is Hull, Portsmouth and other clubs that are local and who have had a lot of publicity.

"But that is irrelevant to us, we have to get on with our own business."

Reid, who hit out last year at Rangers fans for singing 'The Famine Song' - which refers to events which killed an estimated one million people in the 19th century and led to a mass migration from Ireland - claimed racist behaviour from visiting fans at Celtic Park was still a problem.

However, the Celtic chairman used as evidence the recent Europa League home game to Bundesliga side Hamburg.

He said: "It still goes on and we heard it in the Hamburg game the other night.

"I have two uncles who died fighting a poisonous regime, at the heart of which was racism. They were called Nazis.

"So since I was 17 or 18 I have held the view that the vast majority of British people do, that you judge someone according to their inherent values and actions not their races, or background or colour.

"Nobody is saying that anyone has a monopoly on offensive singing but the worst type is racism, whether against people because of their colour, religion or ethnic origins."

Most of the AGM was good-natured with one shareholder calling for Mowbray to tell striker Georgios Samaras to get his hair cut.

Another, to great cheers, said defender Gary Caldwell should have been sent home on the day of the Europa League game against Hapoel Tel Aviv in Israel last month for discussing his contract demands with the media.

When a spokesperson from the Celtic Supporters Trust complained about the atmosphere, Reid, with another jibe at Rangers, replied: "If you want a boring crowd of Holy Willies, go over to the other side of the city."