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EU Push to Use Frozen Russian Assets Draws Warnings on Euro’s Reserve Status

Legal risk warnings from investors, the IMF, plus the ECB point to potential damage to confidence in euro assets.

Overview

  • The European Commission is pursuing EU approval to repurpose €185–€210 billion in immobilized Russian sovereign assets as a conditional loan for Ukraine.
  • FT reports that fund managers caution confiscation could erode property-rights protections and force a geopolitical risk premium on euro-denominated securities.
  • The IMF says any action must comply with international and national law and safeguard the international monetary system, while the ECB has voiced serious legal and financial doubts.
  • Belgium remains cautious over using Euroclear-held funds and is seeking concrete EU guarantees, with roughly €180 billion tied up at the Brussels-based clearer.
  • Norway shows reluctance to asset seizure, according to Russia’s ambassador in Oslo, who cited precedent risks for the country’s global sovereign wealth fund.