LONDON —  A major U.K. central bank loan for Midland has put an end to the town’s bankruptcy, putting it on a path to profitability, a new report said Monday.

The midland funds are the largest local loan program in the world, lending at least $9 billion to small towns in England and Wales.

But the loan, the first of its kind, came amid mounting political pressure to overhaul the government’s role in town finances, particularly after the midlands fund announced its biggest annual loss since 2009.

A statement from the midlander fund said that after a review of the financial statements, the board had concluded that Midland’s finances are sound and that it will be a safe place to operate and that the town can recover from its financial difficulties in the long term.

Midland’s financial woes began when the town lost $6 million in tax revenue in 2009, then lost $20 million more in 2010, when a new city council voted to cut services and reduce services to the public, the Midland Fund said.

Since then, the town has struggled with debt, with debts rising to $12 million by late June.

Despite its troubles, the fund said Midland was “well-positioned to recover.”

The town, which has about 3,000 residents, has been trying to keep afloat by cutting services, reducing its staff and increasing spending on public amenities, including the sale of a $2 million house for a homeless man.

As of the end of May, Midland had $4.7 million in cash, up from $3.8 million a year earlier.

Its debts, including debts to the central bank, the central government and the county council, total $9,890,836, the midlanders fund said.

Midland owes $2.7 billion to private investors, according to the fund.

Last week, Midlands board voted unanimously to borrow $1.9 billion from the central fund, which would allow the town to stay afloat.

This year, the council will also use a loan from the London fund, as it has done in the past, the statement said.

The loan would not be guaranteed and the loan amount would depend on the town being able to raise more money from private investors.

While Midland is on a recovery path, it remains in a precarious position, the city said.

“The midlands funding will be available to the board to ensure Midland returns to full operating capacity and profitability,” it said.

The council has said it expects to borrow about $2 billion in the coming year.

Middlesex central bank chief John Grant said he expects Midland to recover by next year, but the fund’s statement does not say when.

“The balance sheet is strong and Midland remains one of the largest and most profitable local authorities in the United Kingdom,” he said.

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