Key facts
- The EU will use €1.4 billion from interest on frozen Russian assets to aid Ukraine.
- The funds were transferred to the EU on August 3.
- 95% of the proceeds will go to the Ukraine Loan Cooperation Mechanism.
- The remaining 5% will be allocated via the European Peace Facility for military needs.
- This is the fourth transfer of such funds.
The European Union has received €1.4 billion ($1.6 billion) in profits generated from immobilized Russian central bank assets, the European Commission announced. The funds, transferred on August 3, stem from interest accumulated on assets frozen following Russia's invasion of Ukraine.
European Commission President Ursula von der Leyen stated that Russia must pay for the destruction it has caused and that these proceeds will ensure that. She added that the €1.4 billion will support Ukraine's continued resistance against Russia's war.
According to the Commission, 95% of the proceeds will be channeled through the Ukraine Loan Cooperation Mechanism to help Kyiv service loans from the EU and G7 partners. The remaining 5% will be allocated via the European Peace Facility to address Ukraine’s military and defense needs, supporting its armed forces and public services.
This transfer is part of the broader sanctions framework against Russia. While the assets themselves remain frozen, the EU has authorized the use of profits generated from them. This marks the fourth such transfer, with previous tranches delivered in 2024 and 2025. EU leaders also recently agreed on a separate €90 billion loan package for Ukraine for 2026-2027.
Despite the EU having immobilized over €200 billion in Russian assets, member states have differing views on their direct use due to legal and financial risks. Countries like Belgium, Hungary, and Slovakia have expressed concerns or skepticism, leading the EU to proceed with joint borrowing while debating longer-term mechanisms involving Russian assets. EU rules adopted in 2024 require financial institutions holding Russian state assets to set aside profits, and legal measures approved in May 2024 allow these proceeds to be redirected to Ukraine.