Euroclear Cautions About Potential Dangers of Seizing Russian Assets
According to Euroclear’s CEO, if the frozen assets are seized for the benefit of Ukraine, the associated liabilities ought to be transferred as well, he shared with Bloomberg. Read Full Article at RT.com.
TroibNews 
The topic of utilizing frozen funds has resurfaced amid growing concerns regarding the future of US aid to Ukraine with Donald Trump poised to take office.
Euroclear, the Belgian-based clearinghouse that manages most of Russia’s frozen assets, has expressed its reluctance to take on liability if the EU moves forward with confiscating these funds and transferring them to Ukraine. Euroclear froze an estimated €197 billion in assets belonging to the Russian central bank due to sanctions linked to Ukraine, which have resulted in €5.15 billion in interest during the first three quarters of this fiscal year.
Earlier this year, the EU opted to allocate a portion of that interest to Ukraine but refrained from tapping into the frozen assets themselves, leading to renewed accusations of theft from Russia.
Euroclear's CEO, Valerie Urbain, stated to Bloomberg on Tuesday that any proposal for asset seizure must also encompass all associated liabilities. "We cannot be in the situation whereby the assets have been seized, but, in a couple of years, Russia comes and knocks at the door and says, ‘I want to recoup my securities,’ while the securities assets would have been gone,” she explained. “If there is a confiscation of assets, everything should move, liabilities included.”
In July, Euroclear disclosed that it had made an initial payment of approximately €1.55 billion to the European Fund for Ukraine, drawn from the interest accrued on the Russian assets. That same month, the European Commission announced a €1.5 billion allocation to Kiev as the first installment of aid.
In October, the European Parliament endorsed a loan of up to €35 billion to Ukraine, with repayment expected through future revenue generated by the Russian funds. This loan forms part of a broader package agreed upon by the G7 in June, aimed at providing up to $50 billion in financial assistance to Ukraine. The Biden administration recently confirmed the transfer of its share of the loan to Kiev, amounting to $20 billion, which the Treasury Department noted is “paid for by the windfall proceeds earned from Russia’s own immobilized assets.”
Bloomberg highlighted that, due to Donald Trump’s intentions to cut aid to Ukraine, discussions on directly utilizing these assets might re-emerge. Urbain cautioned that such a measure could jeopardize the euro’s status as a reserve currency and destabilize the financial framework of the bloc. This sentiment was echoed earlier by Christine Lagarde, the president of the European Central Bank.
On Tuesday, a delegation from the European Parliament arrived in Kiev to engage in discussions about the EU’s financial aid to Ukraine. The head of the delegation, Iratxe Garcia, announced that he had urged High Representative Kaja Kallas to “put forward a legal proposal to use the €200 billion of frozen Russian state assets in order to arm and reconstruct Ukraine.”
During the meeting, President Zelensky reiterated Ukraine’s plea to access the immobilized Russian funds to finance weaponry, asserting that $30 billion would be sufficient to “fully cover our skies.”
Max Fischer contributed to this report for TROIB News
Euroclear, the Belgian-based clearinghouse that manages most of Russia’s frozen assets, has expressed its reluctance to take on liability if the EU moves forward with confiscating these funds and transferring them to Ukraine. Euroclear froze an estimated €197 billion in assets belonging to the Russian central bank due to sanctions linked to Ukraine, which have resulted in €5.15 billion in interest during the first three quarters of this fiscal year.
Earlier this year, the EU opted to allocate a portion of that interest to Ukraine but refrained from tapping into the frozen assets themselves, leading to renewed accusations of theft from Russia.
Euroclear's CEO, Valerie Urbain, stated to Bloomberg on Tuesday that any proposal for asset seizure must also encompass all associated liabilities. "We cannot be in the situation whereby the assets have been seized, but, in a couple of years, Russia comes and knocks at the door and says, ‘I want to recoup my securities,’ while the securities assets would have been gone,” she explained. “If there is a confiscation of assets, everything should move, liabilities included.”
In July, Euroclear disclosed that it had made an initial payment of approximately €1.55 billion to the European Fund for Ukraine, drawn from the interest accrued on the Russian assets. That same month, the European Commission announced a €1.5 billion allocation to Kiev as the first installment of aid.
In October, the European Parliament endorsed a loan of up to €35 billion to Ukraine, with repayment expected through future revenue generated by the Russian funds. This loan forms part of a broader package agreed upon by the G7 in June, aimed at providing up to $50 billion in financial assistance to Ukraine. The Biden administration recently confirmed the transfer of its share of the loan to Kiev, amounting to $20 billion, which the Treasury Department noted is “paid for by the windfall proceeds earned from Russia’s own immobilized assets.”
Bloomberg highlighted that, due to Donald Trump’s intentions to cut aid to Ukraine, discussions on directly utilizing these assets might re-emerge. Urbain cautioned that such a measure could jeopardize the euro’s status as a reserve currency and destabilize the financial framework of the bloc. This sentiment was echoed earlier by Christine Lagarde, the president of the European Central Bank.
On Tuesday, a delegation from the European Parliament arrived in Kiev to engage in discussions about the EU’s financial aid to Ukraine. The head of the delegation, Iratxe Garcia, announced that he had urged High Representative Kaja Kallas to “put forward a legal proposal to use the €200 billion of frozen Russian state assets in order to arm and reconstruct Ukraine.”
During the meeting, President Zelensky reiterated Ukraine’s plea to access the immobilized Russian funds to finance weaponry, asserting that $30 billion would be sufficient to “fully cover our skies.”
Max Fischer contributed to this report for TROIB News
