On August 11, the European Commission announced the transfer of €1.6 billion to Ukraine, sourced from interest earnings on funds originating from russian Central Bank assets frozen under sanctions imposed over Russia’s full-scale war against Ukraine
The funds will be used to service Ukraine’s debt obligations and finance its defense needs. According to the Commission, this is the third such tranche: the first was transferred in July 2024, and the second in April 2025. The current amount reflects revenues accumulated during the first half of 2025.
“This step is part of the EU’s ongoing commitment to support Ukraine for as long as necessary,” the European Commission stressed.
Previously, 90% of the proceeds were channeled through the European Peace Facility (EPF). Now, 95% will be directed via the Ukraine Loan Coordination Mechanism (ULCM) to provide non-repayable funding for servicing loans from the EU and bilateral creditors. The remaining 5% will be allocated for military and defense purposes via the EPF. The total loan support committed under the ULCM stands at €45 billion.
