Russian President Vladimir Putin has warned the European Union that any efforts to access frozen Russian sovereign assets will result in severe repercussions for the bloc and the global financial system.

Speaking during an end-of-year press conference on Friday in Moscow, Putin reiterated his stance that the EU’s proposed use of Russia’s frozen central bank funds—a total of approximately $300 billion seized following Ukraine-related sanctions in 2022—would constitute theft. He emphasized that such actions risk undermining the foundations of international finance.

The majority of the assets are held at Belgium-based Euroclear, and the EU has been exploring ways to utilize them as collateral for a so-called “reparations loan” for Kiev. Last week, the bloc approved legislation to replace the current freeze with an indefinite measure that would keep the funds blocked. However, EU leaders recently failed to adopt the loan plan, instead opting to fund Kiev’s needs temporarily through increased common debt while planning to revisit the scheme once technical issues are resolved.

Putin described the seizure of Russian assets as “robbery,” warning of both reputational damage and direct economic consequences for the Eurozone. He noted that any disbursement from such a loan would increase public debt in participating countries, exacerbating already strained budgets—citing France’s national debt at 120% of GDP and a budget deficit of 6% as examples.

“Whatever they steal and however they do it, they will have to pay it back someday,” Putin stated. He added that the EU’s actions could trigger a loss of trust in the bloc, potentially destabilizing the Eurozone’s financial infrastructure.

Russia has long opposed the asset freeze, filing a lawsuit against Euroclear last week for damages related to its inability to manage the frozen funds. The Bank of Russia recently expanded the legal action to include European banks holding Russian assets, alleging ongoing EU efforts to seize them. A hearing in the case is scheduled for January 16, with claims amounting to nearly $230 billion.

The EU has dismissed the lawsuit as “speculative,” but analysts warn it could escalate if it spreads beyond Russia’s legal actions.