International depository Euroclear received €4.4 billion in interest income from frozen Russian assets. This is 80% of the depositoryʼs net interest income.
This is stated in Euroclearʼs annual report.
Frozen Russian assets lead to the accumulation of cash on the balance sheet of Euroclear Bank. At the end of 2023, the bankʼs balance sheet increased by €38 billion compared to the previous year and amounted to €162 billion.
Cash balances are reinvested to minimize risks and capital requirements. And the interest received from the reinvestment is the net interest income received by Euroclear. Thus, the depository received €4.4 billion.
Including Belgian corporate tax, these profits will generate almost €1.1 billion in tax revenue for the Belgian budget in 2023. Future income will depend on changes in interest rates and the size of cash balances (this is affected by the development of sanctions).
In total, Euroclear incurred additional direct costs of €62 million in 2023 from managing the Russian sanctions, as the depository "commits significant time, resources and capital to managing market challenges, potential risks and the consequences of sanctions."
Who can transfer frozen assets to Ukraine
Since the beginning of the war in Ukraine, the EU has frozen the assets of the Russian Central Bank for more than €200 billion. A significant part of these funds is kept in the depository of Euroclear. In addition, the EU has frozen €24.1 billion in assets belonging to Russians and Russian companies under sanctions. Recently, the USA froze another $8 billion of Russian assets.
Currently, the United States and the European Union are looking for legal opportunities to use all $300 billion of frozen Russian assets for the benefit of Ukraine. Meanwhile, Ukraine expects to receive $300-500 billion from such assets.
- On January 29, the EU agreed on a proposal to use surplus profits (interest) from frozen Russian assets for the benefit of Ukraine. And back in October, the Prime Minister of Belgium Alexander De Croo announced that in 2024, his country would transfer €1.7 billion in taxes from revenues from frozen Russian assets to help Ukraine.