Key facts
- Nine countries, including Canada, Albania, Belgium, Greece, Latvia, Luxembourg, Romania, Turkey, and Ukraine, have committed to the new Defence, Security and Resilience Bank (DSRB).
- The DSRB aims to provide up to £100 billion (€117bn) for defence projects by borrowing cheaply on international markets.
- Major European military and economic powers such as Britain, Germany, and France have not yet joined the initiative.
- The UK is leading a separate proposal, the Multilateral Defence Mechanism (MDM), which is more of a joint procurement vehicle.
- The DSRB is scheduled to launch in 2027, with its headquarters in Canada and a European base in Luxembourg.
A new multilateral bank, the Defence, Security and Resilience Bank (DSRB), has been launched with the backing of nine countries, aiming to finance Western rearmament efforts. Announced by Canadian Prime Minister Mark Carney at the NATO summit in Ankara, the DSRB is designed to provide cheaper loans and guarantees to governments and defence companies struggling to secure affordable financing in an era of expanding military budgets.
The initiative, proposed in 2024 by former NATO advisers, military figures, and bankers, seeks to pool members' capital to achieve a triple-A credit rating, enabling it to borrow at lower costs on international markets. The goal is to raise up to £100 billion (€117bn) for defence projects, complementing national defence budgets and potentially reshaping how Western nations fund their military build-ups, similar to the roles of the European Investment Bank or the World Bank.
However, the DSRB's ambition is tempered by the notable absence of Europe's largest military and economic powers, including Britain, Germany, and France. Analysts suggest this hesitancy could limit the bank's financial reach. Germany is participating as an observer, while talks are ongoing with South Korea. The UK, in particular, is pursuing a potentially rival initiative, the Multilateral Defence Mechanism (MDM), which focuses on joint procurement and stockpiling of equipment off national balance sheets. Despite this, the UK states it is working with Canada on both initiatives, positioning the DSRB to support smaller supply-chain firms.
The existence of overlapping structures, including the EU's own defence loan instrument, highlights the urgent and experimental approach Western governments are taking to mobilise private capital for defence. The DSRB's ultimate impact will depend on whether these major economies eventually join, back rival projects, or continue with existing mechanisms.