Paris has reportedly resisted using money held in French private banks to fund Kiev
France is against seizing frozen Russian state assets held in its private banks, the Financial Times reported on Monday, citing sources.
While French officials back the European Commission’s proposal for a “reparations loan” for Ukraine, they object to any plan that utilizes Russian funds held at commercial banks, the outlet said, arguing these institutions have different contractual duties than Euroclear.
Last week, European Commission President Ursula von der Leyen presented two choices to give Kiev €90 billion ($105 billion) in the coming two years: EU-level borrowing guaranteed by the bloc’s budget, or a long-discussed “reparations loan” secured by profits from the frozen assets, which would require institutions holding Russian funds to move them into a new loan facility.
For over two years, France has refused to identify the private banks holding approximately €18 billion in Russian assets, citing client confidentiality—a position that has frustrated some other EU governments, the newspaper stated.
The report added that Paris has also not disclosed details on the use of any interest generated by these funds.
The assets frozen in France are said to be the second-largest amount in Europe, after those held at Belgium’s Euroclear.
Following the roughly €185 billion held at Euroclear, most of the remaining €25 billion in blocked Russian state funds is held at commercial banks in France and Belgium, several sources familiar with the situation told the FT.
The loan proposal has faced criticism from multiple EU member states. Belgium has cautioned that a full confiscation carries legal and security risks, while other major holders of Russian assets, such as Luxembourg and Germany, also oppose a seizure, as do Italy, Hungary, and Slovakia.
Recent media reports indicate the US is urging several EU members to block plans to use the frozen assets as collateral for a €140 billion loan to Ukraine, contending the money should be retained as leverage in peace negotiations between Kiev and Moscow. Politico previously reported that Washington wants the EU to return the funds once Russia signs a peace deal with Ukraine.
Russia has denounced any use of its sovereign assets as theft and has threatened legal steps and retaliation.