EU hands Ukraine €1.4bn in interest from frozen Russian assets following deadly attack on Kyiv

by · EUobserver

The announcement by the EU Commission on Wednesday came after a series of missile and drone attacks killed at least 17 people and wounded 44 in Kyiv overnight. (Source: Ukraine’s government)

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By Benjamin Fox,

The EU will use €1.4bn generated by the interest on the cash balances originating from immobilised assets of the Central Bank of Russia (CBR) to provide financial support for Ukraine.  

In a statement on Wednesday (5 August), the European Commission said that the interest had been accrued in the first six months of 2026 from some €210bn in Russian central bank reserves that were frozen by the EU after Moscow’s full-scale invasion in 2022 and are currently held by Central Securities Depositories (CSDs). 

“Russia must pay for the destruction it has caused. And we are using the proceeds from the immobilised Russian assets to make sure it does,” said European Commission president Ursula von der Leyen.

“This will support Ukraine’s continued resistance against Russia’s illegal war,” she added.

The broader question of what to do with the billions of euros in Russian assets that were frozen as part of the EU’s sanctions regime against president Putin’s regime remains unresolved.

The EU commission had proposed that the assets be used to guarantee the EU’s financial support for Ukraine via a ‘reparations loan’ and to help finance its post-war reconstruction.

However, Belgium, whose Brussels-based depositary Euroclear holds around 90 percent of the funds, opposed this plan on the grounds that it could face legal challenges and be held liable by the Kremlin.  

But the interest from the frozen funds can be used. 

The EU executive said the new €1.4bn tranche was the fifth transfer of its kind, adding that the Russian assets have generated a total of €8bn in windfall profits since 2022. 

However, only five percent of the cash, equivalent to €70m, will be used to finance military assistance for Kyiv via the European Peace Facility. 

The remaining €1.33 billion will be funnelled through the Ukraine Loan Cooperation Mechanism to help service loans extended to Ukraine via the EU and G7. 

The announcement by the EU Commission on Wednesday came after a series of missile and drone attacks killed at least 17 people and wounded 44 in Kyiv overnight. 

Ukrainian president Volodymyr Zelensky said on social media that additional missile interceptors “could have saved lives” and blamed delays in Western air-defence deliveries. 

"Partners who are not ready to help more actively with interceptor supplies right now can assist with new sanction measures," Zelensky said, arguing that much of Russia's ballistic missile production remains outside existing sanctions.

"New steps are needed from the G7 and the EU," he added.

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The announcement by the EU Commission on Wednesday came after a series of missile and drone attacks killed at least 17 people and wounded 44 in Kyiv overnight. (Source: Ukraine's government)

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Author Bio

Benjamin Fox is our trade and geopolitics editor. His reporting has also been published in the Guardian, the East African, Euractiv, Private Eye and Africa Confidential, among others. He is based in Nairobi, Kenya, although he often reports from London.

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