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West Bromwich Albion Holdings took over the £5m debt owed to West Bromwich Albion by controlling shareholder Guochuan Lai after auditors impaired the loan, which was due to be repaid by beneficiaries Wisdom Smart Corporation.

Lai borrowed £4.95m from West Bromwich Albion Group in March 2021 during their most recent Premier League season to help Wisdom Smart, whose business has been affected by covid.

Having initially set himself a September 2021 deadline and then New Year’s Eve 2022 to pay the cash, Lai still owes Albion the outstanding sum.

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Since Wisdom Smart is now unlikely to return the cash, there is a guarantee from WBA Holdings, a wholly owned subsidiary of Yunyi Guokai (Shanghai) Sports Development Limited, another Lai company, that the money, along with the lump sum of interest, will be returned from that source. It remains to be seen when that will happen.

In a recent correspondence with a shareholder, the group’s director, Xu Ke, confirmed Lai’s intention to repay the money owed, which he had earlier promised could be spent on January transfers, without the need to declare a dividend. He added that he was taking appropriate steps to protect the Group’s position in relation to the refund.

In the club’s statement on Thursday, Albion added: “Majority shareholder and chairman Guochuan Lai has reiterated his assurance to the club that the loan and accrued interest will be repaid.”

Elsewhere in Albion’s published accounts, they posted a pre-tax profit of £5.4m, an increase of £5.3m on the previous year, while turnover declined to £65.4m due to the relegation and the associated loss of Premier League revenue and sponsorship.

Staff costs fell from £76.9m to £42.4m, mainly due to a reduction in gaming staff salaries. Following these accounts, it was also noted that the Group had received a £20 million loan from MSD Holdings, which the club had received in full.

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