European Union executive blocks €1.5bn loan to Ukraine, Bloomberg writes.

According to the publication, European officials fear that in the event of a default, our country will not be able to return the borrowed money..

“A loan offered to Ukraine has been blocked by the budget department of the European Commission due to concerns about its financial reliability,” officials told the publication on condition of anonymity..

The European Investment Bank (EIB), the lending arm of the EU, has offered a loan to Kyiv to support a war-torn country facing rising war costs and falling incomes..

The commission normally guarantees EIB loans for non-EU operations, with guarantee reserves typically amounting to 9% of total financing.

But in this case, the commission wants to secure 70% of the total, as it did with the previous €1 billion offer for Ukraine, officials said..

According to them, the commission puts forward such a requirement in case the country cannot return the funds..

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Commission spokesman said EU needs to make sure they can make amends if Ukraine defaults. The Commission is looking for alternative solutions where EU or EIB member states share some of the additional risk associated with these loans, the official added..

A number of bloc allies privately criticized the EU at a donor conference in Lugano earlier this week for failing to meet its previous commitments of nearly €9 billion and urging it to do so immediately, sources say..

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Finance Ministry in Kyiv is running out of funding opportunities as the war drags on, leaving the country increasingly dependent on foreign aid. Ukrainian officials are exploring debt restructuring as a way to lighten the burden of credit while remaining on good terms with international investors.

Earlier it was reported that the World Bank provided financial support to Ukraine in the amount of €446.8 million. The UK is the guarantor.