Overview

• At an informal summit in Copenhagen, leaders voiced broad backing for a European Commission concept to leverage immobilized Russian central bank assets for a zero‑interest loan to Ukraine, while noting legal questions still to resolve.
• The draft design envisions moving assets into a special‑purpose vehicle in exchange for zero‑coupon European Commission bonds, guaranteed by a coalition of participating states, with Ukraine repaying only if Russia pays reparations.
• Belgium and Euroclear seek strong, shared guarantees and the European Central Bank warns about risks to the euro’s credibility, as capitals weigh unanimity constraints, potential vetoes from Hungary and Slovakia, and a possible coalition‑of‑the‑willing route.
• EU officials are debating whether to steer part of the facility toward purchases of European‑made weapons, with Germany, Sweden and Finland supportive, while others prefer broader budget support for Kyiv.
• Concurrent moves include a fresh €4 billion ERA disbursement to Ukraine from EU/G7 interest proceeds, a G7 finance ministers call that stopped short of joint action on assets, the EU’s push for U.S. and Japanese participation, and Kremlin threats of legal retaliation alongside a U.S. Senate draft urging $10 billion monthly transfers from frozen assets.