Major EU clearinghouse Euroclear has revealed that it accrued almost $5 billion in profit from frozen Russian assets last year.
In its financial results for 2023 published on Thursday, the Belgium-based company reported that net interest earnings amounted to €5.5 billion ($5.9 billion), of which €4.4 billion “relate to interests linked to Russian sanctions.”
The company explained that the profits were driven by factors such as the prevailing interest rates and the amount of cash balances that Euroclear is required to invest.
It’s estimated that the clearing house is holding €196.6 billion (nearly $220 billion) worth of Russian assets, the vast majority of which belong to the country’s central bank. In total, the EU has frozen €207 billion (just over $231 billion) of Russian assets and reserves since the beginning of the Ukraine conflict.
EU leaders have repeatedly called for using the funds “to rebuild Ukraine” and agreed last year to develop a scheme to use the windfall profits generated by the funds. However, a number of officials, including ECB President Christine Lagarde, have warned that a windfall tax could undermine the euro and cause concern among those keeping reserves in the currency.
Underscoring the persisting uncertainties over attempts to implement profit-siphoning schemes, Euroclear said that it “considers it necessary to separate the estimated sanction-related earnings from the underlying financial results when assessing the company’s performance and resources.”
Earlier this week, the Belgian presidency of the EU Council announced that the bloc’s member states had reached an agreement that would allow Brussels to transfer the income generated by Russia’s frozen central bank reserves to Kiev.
“EU Ambassadors just agreed in principle on a proposal on the use of windfall profits related to immobilised assets to support Ukraine’s reconstruction,” the Belgian presidency said in a post on X (formerly Twitter).
The Financial Times, meanwhile, reported that EU envoys had approved a plan to set aside the profits generated from the frozen assets with no dividends to be paid to shareholders until members of the bloc unanimously opt to set up a “financial contribution to the [EU] budget that shall be raised on these net profits to support Ukraine.”
Moscow has repeatedly warned that any actions taken against its assets by the US or its allies would amount to “theft,” stressing that seizure of the funds or any similar move would violate international law and undermine reserve currencies, the global financial system, and the world economy.
For more stories on economy & finance visit RT’s business section