Nicosia: On 3rd of August, the European Union received £1.4 billion in windfall profits generated by the interest on cash balances originating from immobilised assets of the Central Bank of Russia (CBR) held by Central Securities Depositories (CSDs). This marks the fifth such transfer, following a previous tranche delivered in March 2026, covering revenues accumulated during the first half of 2026. Since their immobilisation, Russian assets have generated a total of £8 billion in windfall profits.
According to Cyprus News Agency, European Commission President Ursula von der Leyen stated that the proceeds from these immobilised Russian assets would be used to ensure accountability for the destruction caused by Russia. The European Union plans to allocate an additional £1.4 billion to support Ukraine's continued resistance against Russia's actions.
These funds originate from CBR assets immobilised under EU sanctions, imposed in response to Russia's aggression against Ukraine. While the assets remain immobilised, the interest on the cash balances does not belong to Russia. Upon the proposal by the Commission and the High Representative, the Council decided the net profits should support Ukraine, as part of the EU's ongoing commitment.
A significant 95% of the proceeds will support Ukraine via the Ukraine Loan Cooperation Mechanism (ULCM), while the remaining 5% will be allocated through the European Peace Facility (EPF). The ULCM assists Ukraine in repaying the EU macro-financial assistance loan disbursed throughout 2025 and loans provided by G7 bilateral lenders under the G7 'Extraordinary Revenue Acceleration (ERA) Loans' initiative, totaling £45 billion. Meanwhile, the EPF addresses Ukraine's military and defense needs.
In response to Russia's invasion of Ukraine, the EU adopted several restrictive measures against Russia. These sanctions led to the immobilisation of CBR assets held in the EU. The prohibition on transactions involving these assets resulted in the accumulation of cash and deposits on CSDs' balance sheets, generating extraordinary revenues.
Following proposals by the Commission and the High Representative, the Council decided in February 2024 that central securities depositories holding more than £1 million in assets and reserves of the Central Bank of Russia, immobilised due to EU sanctions, must set aside these extraordinary cash balances. They may not dispose of the resulting net revenues.
Further proposals led to the adoption of legal acts on 21 May 2024, enabling the use of these net profits for Ukraine's benefit. In December 2025, the Council prohibited transfers of immobilised CBR assets back to Russia based on Regulation 2025/2600, using Article 122 TFEU as a legal basis.