Peace borrowed £3.7million from the club – with that money going into his own company, WBA Holdings.
That debt was then transferred to current owner Guochuan Lai when he took over the club in 2016.
Shareholders For Albion (S4A), which represents the majority of small shareholders who own 12 per cent of the club, have long called for an independent investigation into the loan.
And back in May, the Express & Star revealed Baggies chief executive Xu Ke had held talks with their minority shareholders about potentially commissioning a review.
That investigation will be one of the items under discussion at a general meeting taking place at The Hawthorns next week.
It has previously been claimed by S4A that Peace may have used the loan from the club to WBA Holdings to assist a bid he had made, three months earlier, to purchase shares in WBA Group, the club’s parent company.
Peace increased his stake in WBA Group from around 65 per cent to 88 per cent in 2014. Two years later he sold the club to Lai for around £175m.
Using the loan to increase his own shareholding is something Peace has always strenuously denied. The ex-chairman has also always maintained the loan was “competitively advantageous” to the club.
And now the former chairman has spoken about the loan for the first time and welcomed calls for an investigation.
He told The Times newspaper: “Certain independent shareholders have been grumbling for years since I sold shares in 2016, when they know that they have no basis for complaint.
“I want to make it clear that money was not borrowed from the football club to buy shares.
“There was nothing untoward or improper in respect of any of my dealings with West Bromwich Albion.
“I welcome an investigation to put an end, once and for all, to the baseless comments of a small group of shareholders.
“The loan made to West Bromwich Albion Holdings by the football club was on arm’s length and commercially attractive terms at a time when cash deposits elsewhere were (and still are) earning a much lower rate of interest.”
The Express & Star revealed back in January the interest for that loan, which Lai has not repaid, has now surpassed the £1 million mark – meaning the Baggies are now owed in the region of £5 million.
At the meeting next week, S4A will call for an ‘independent investigation into all the circumstances surrounding and leading up to the making of the loan.’
They are also expected to put forward a resolution that has the aim of ‘establishing whether or not each director at the club complied fully with their respective fiduciary obligations in relation to the loan.’