Canada Backs €100 Billion Global Defence Bank

Canadian Prime Minister Mark Carney is backing a proposed global defence bank designed to help allied nations finance military expansion, although several major economies have yet to join ahead of a planned charter signing this autumn.

The Defence, Security and Resilience Bank (DSRB), which is expected to be based in Canada, aims to mobilize about €100 billion ($116 billion). The institution plans to provide low-cost loans to governments and defence contractors while offering guarantees to lenders financing smaller companies considered higher-risk borrowers.

Canada, Albania, Belgium, Greece, Latvia, Luxembourg, Romania, Turkey and Ukraine have pledged support. Officials involved in the project said the DSRB had secured roughly €5 billion in commitments by August. Its target includes around €20 billion in paid-in capital and another €80 billion available when required.

However, Germany, Britain and other G7 economies have not committed, potentially complicating the DSRB's ambition to obtain a triple-A credit rating and secure cheaper borrowing costs.

William Perraudin, managing director at Risk Control, said participation from several substantial governments would strengthen the bank's case with ratings agencies. Potential members have also raised questions about upfront capital requirements, governance, project selection and whether the DSRB can provide cheaper financing than highly rated governments.

The proposed institution also faces potential overlap with existing defence financing programs. The European Union launched its €150 billion Security Action for Europe (SAFE) initiative in 2025, while Britain is developing a Multilateral Defence Mechanism with the Netherlands, Finland and Poland.

DSRB founder Rob Murray argues the bank could provide a permanent financing platform as NATO allies increase defence spending amid growing geopolitical risks. Larger members have reportedly been asked to contribute about €1 billion, payable over three years.

Canada is also seeking British participation. Prime Minister Andy Burnham has discussed the DSRB with Carney, while British and German defence industry groups have encouraged their governments to join.

Around a dozen financial institutions, including JPMorgan and Deutsche Bank, have reportedly provided approximately $10 million in funding or services to support the DSRB's creation.

Ottawa is prepared to launch the defence bank with its existing supporters, allowing additional countries to become members later.