International depository Euroclear received €3 billion in interest income from frozen Russian assets.
This is stated in Euroclearʼs report on financial results for 9 months of 2023.
According to the depository, the profit from Russian assets is caused by two factors:
- high interest rates;
- the amount of money that Euroclear is obliged to invest.
Therefore, future profits will depend on changes in rates and the size of invested funds against the background of the developing sanctions regime. At the same time, Euroclear expects that the growth of the monetary balance "will begin to stabilize" as the rates of accumulation of blocked payments and repayments decrease.
The Euroclear Board notes that the European Commission is considering various options for using the proceeds from sanctioned assets to finance the reconstruction of Ukraine.
Bloomberg notes that these data are likely to intensify discussions in the EU regarding the proposal to introduce a tax on profits from the investment of Russian assets and transfer the proceeds to the reconstruction of Ukraine.
According to Politico, the European Union postponed the decision to introduce a special tax due to the disagreement of several members of the bloc, including Germany and France. In total, more than 200 billion euros of assets of the Russian Central Bank are blocked in the EU countries, most of them are kept in the Belgian clearing bank Euroclear.
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 Euroclear depository and has already brought almost €750 million in profit in the first quarter of 2023. 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 September 7, the United States announced that, for the first time, it would transfer the confiscated assets of Russian oligarchs to Ukraine. We are talking about $5.4 million, which will go to support Ukrainian veterans. After that, Estonia announced that it plans to become the first country in the EU to transfer confiscated Russian assets (approximately €38 million) to Ukraine.