After months of wrangling, a first tranche of money could be disbursed as early as July if Brussels can secure approval of member states, officials said. The proposal is expected before a summit of EU leaders next week.

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Commission president Ursula von der Leyen has called for the funds to be used for military support, rather than postwar reconstruction as had been originally envisaged — a contentious approach for some capitals.

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About €190bn in Russian sovereign assets have been immobilised at Euroclear since Moscow’s full-scale invasion of Ukraine in 2022, generating €3.85bn in profits.

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The latest plans would provide between €2bn and €3bn to Ukraine this year, depending on interest rates, the officials said. The total profits siphoned from Euroclear could reach €20bn by 2027, according to EU officials.

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The hotly debated question of whether to use Russian funds tied up in Brussels-based Euroclear to aid Ukraine has become more pressing as the war has entered its third year and international aid has dwindled.

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The depository holds the bulk of the €260bn in Russian central bank assets frozen by western sanctions.

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With G7 countries split over whether to seize the underlying assets and hand them over to Ukraine, the EU proposed a parallel track of using only the profits.

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The EU initially planned to use some of the Euroclear funds for Ukraine’s postwar reconstruction, but with further US military aid blocked by Republicans in Congress, the focus has moved to military support.

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Von der Leyen last month floated the idea of using the profits to buy weapons for Ukrainian forces, but this suggestion is likely to face opposition from member states, including Viktor Orbán’s Hungary.

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According to the Kyiv finance ministry, only about half of the $37bn needed from international partners this year has been committed by the EU and the IMF. Officials in Ukraine have reached out to other partners and are hoping the profits on frozen assets could help fill that gap.

The EU could use the profits to buy weapons for Ukraine through an existing fund for which member states are currently negotiating a €5bn top-up, or to invest in the Ukrainian defence industry.

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According to a draft of the commission’s internal proposal seen by the Financial Times, Brussels could appropriate 97 per cent of the net profits derived from frozen Russian assets held by Euroclear, and transfer them to the EU budget.

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The money would then be paid out every quarter or twice a year and “could be used to the benefit of Ukraine according to different arrangements”, the draft says.

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The proposal needs final commission approval and the backing of member states.

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The EU’s plans would not apply retroactively, and the nearly €4bn in profits already accrued will be kept by Euroclear, mostly to cover legal fees from litigation with Russia.

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Euroclear is already facing more than 100 lawsuits in Russia over individual investors’ immobilised assets, and Russian courts could order the seizure of some €33bn in western assets blocked at Russia’s central securities depository, the National Settlement Depository, EU officials said.

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Euroclear, which last year handled €37.7tn in assets, is regarded as having systemic relevance for the international financial system, and handles significant amounts of assets from other countries including China.