France Withholds Location of €18bn in Frozen Russian Assets as EU Debates Ukraine Loan

France has declined to disclose where roughly €18bn of Russian assets frozen under EU sanctions are being held, a move that has complicated EU negotiations over a proposed mechanism to guarantee a large loan for Ukraine.

Most of the French-held assets are understood to be held by commercial banks. Paris has argued that private lenders should not be exposed to a proposed €140bn “reparations-style” loan for Kyiv, creating friction with other EU capitals that back using frozen Russian funds to underwrite aid.

What the Plan Entails

The broader EU proposal would use part of about €210bn in Russian assets frozen across European banks and clearing houses to guarantee a loan to Ukraine for the next two years. Under the mechanism, Ukraine would either repay the loan using reparations obtained from Russia, or the EU could — in principle — appropriate frozen assets directly.

Legal And Practical Concerns

Belgium, home to the Euroclear securities depository that holds roughly €185bn of the frozen assets, has raised concerns that it could face legal liability if Russia mounts international challenges. Insiders also say there are unresolved questions about the emergency powers the European Commission has proposed to seize or use the frozen funds.

French officials participating in Brussels talks have cited confidentiality rules in refusing to reveal which domestic banks hold the €18bn. “This is market-sensitive information – it’s the same as if doctors would be publicly discussing medical records,” a European Commission spokesman told the Financial Times.

“This is market-sensitive information – it’s the same as if doctors would be publicly discussing medical records,” a European Commission spokesman told the Financial Times.

It is not publicly confirmed which French banks hold the assets, though BNP Paribas, France’s largest lender, is believed to hold a significant share. The revelation is likely to draw scrutiny of President Emmanuel Macron, who has positioned himself as a prominent European backer of Ukraine. He is expected to be questioned about the decision when EU leaders meet at a summit in Brussels later this month, which has been framed as a deadline for agreement on future financing for Kyiv.

Next steps: EU capitals will continue negotiating liability protections, the legal basis for using frozen assets, and safeguards for commercial banks as they seek a compromise ahead of the leaders’ summit.