BERLIN, December 8. /TASS/. The so-called "reparation loan" for Ukraine is a doubtful idea from the legal standpoint, CEO of Belgium-based Euroclear depository Valerie Urbain said in an interview with the Frankfurter Allgemeine Zeitung newspaper.

"Reserves of the Central Bank of Russia, as distinct from reserves held with private banks, belong to the Russian state. They are protected by law because they fall under the sovereign immunity principle in accordance with the international law. These funds can be frozen judicially. But everything going beyond this framework casts doubt over the country’s sovereignty and hence the international law. From our point of view, ‘no’ is the brief answer," Urbain said, answering the question whether the "reparation loan" is acceptable from the legal point of view and whether the EU can dispose of what is not belonging to it.

"There is no free money for the European Union from Euroclear," the depository CEO said. "These are Euroclear funds and they are pegged to reimbursement claims of the Central Bank of Russia. Anyone believing the EU may use it is indulged in wishful thinking. It is merely impossible without significant risks," Urbain noted.

She said at the same time that the "reparation loan" is "an absolutely uncharted territory". Russia "will never agree to the access to its loans without protest," the Euroclear chief noted. "I am concerned of tit-for-tat actions from the Russian side," Urbain said. "The reparation loan poses real risk for financial stability. If the impression is formed with global investors that their money is not safe in Europe anymore, it will harm the investment climate," the chief executive said, adding that she received inquiries from other central banks holding reserves in the depository about safety of their deposits.

"Persons making political decisions should realize risks of their policy and know how to avoid them," Urbain said. "It seems to me the European Commission and the capitals believe too strong that risks can be eliminated by a single stroke of a pen by adopting a law. But financial markets do not work this way. They depend on perception, expectations and trust. And when politics undermine this trust, the markets respond - and usually it is too late then," she added

On December 3, the European Commission presented its plan to expropriate Russian sovereign assets blocked in Europe under the guise of the "reparation loan" scheme for Kiev. It suggested embezzling all the 210 bln euro frozen in the territory of Europe, with 185 bln held at accounts with Euroclear and no official information available about the other 25 bln. The Commission intends to establish control over 165 bln euro and finance Ukraine in 2026-2027 out of this money, and direct 45 bln euro more to cover loans already extended to Kiev in 2024 against interests from revenues from reinvesting Russian assets.