The U.S. will provide Ukraine with a $20 billion loan funded by frozen Russian assets.

The U.S. Department of the Treasury has announced its decision to allocate $20 billion to Ukraine as part of the G7 initiative to provide $50 billion to the country from the revenues generated by frozen Russian assets.

“The U.S. Treasury is today announcing the allocation of $20 billion for Ukraine as part of the G7 initiative for $50 billion in loans using revenues from assets,” the department's statement reads.

“This amount will be repaid using revenues from frozen Russian assets,” clarified U.S. Secretary of the Treasury Janet Yellen.

Previously, the Cabinet of Ministers of Ukraine approved the terms of an agreement under which the American Federal Financing Bank (FFB) will provide a 40-year loan of up to $20 billion in accordance with the previously agreed G7 initiative to allocate $50 billion to Ukraine from the revenues of frozen Russian assets.

The loan amount will accrue interest at a rate of 1.3% per annum plus the current average rate on U.S. 10-year Treasury securities, with repayments made from the revenues obtained from the frozen assets of the Russian Federation.

As reported, in June 2024, participants at the G7 summit in Italy reached a political agreement on using the revenues from frozen Russian assets to assist Ukraine. The discussion involved providing Kyiv with $50 billion in loans by the end of this year.

It is anticipated that the U.S. will contribute approximately $20 billion, the European Union $20 billion, Japan 471.9 billion yen ($3.1 billion), and the United Kingdom $3 billion.

Background. It is worth noting that earlier, France announced it would supply weapons to Ukraine using frozen Russian assets. This includes providing Kyiv with Mistral air defense missiles and other military equipment.