How can Europe take greater advantage of Russia’s immobilised reserve assets?

The discussion of a reparations loan, opened by European Commission President Ursula von der Leyen in her State of the Union speech on 10 September, is the fourth chapter of the Russian reserves story – one which has already supported Ukraine’s war effort. 

First, in late February 2022, the European Union immobilised reserve assets held under its jurisdiction by the Bank of Russia, denying Russia access to these resources. That included around €180 billion of securities held at Euroclear Bank, the Brussels-based securities depository. Second, in early 2024, the EU appropriated the interest income that Euroclear was making on the cash deposits that had accumulated as those securities matured. Third, in late 2024, the EU and its pro-Ukraine allies agreed to borrow against future proceeds of that interest income, in the form of so-called Extraordinary Revenue Acceleration (ERA) loans totalling around €45 billion. 

The proposed Reparations Loan would have Euroclear lend the full amount (now around €185 billion) at zero interest, leaving around €140 billion for Ukraine after reimbursing the ERA loans. This new loan would be guaranteed by EU member states, giving Euroclear credible reassurance of repayment no matter how the war evolves or ends. If Russia pays reparations, these will directly repay the loan (hence its name); in that case, the national guarantees will not be triggered. 

This scheme squares the circle of providing Ukraine more resources without confiscating the Russian reserves, an action that would be detrimental both to the global monetary order and to Europe’s place in it. Assuming the crucial small print is finalised in the next few months, disbursements to Ukraine could start in the first half of 2026.