Nine countries have formally committed to backing a new multilateral defense bank, a move Canada announced that could mark the largest institutional shift in NATO military financing since the alliance's founding.
The Defence, Security and Resilience Bank, or DSRB, is targeting up to £100 billion ($133 billion) in capital. The institution is designed as a dedicated lender that would issue AAA-rated bonds and offer guarantees to reduce risk for commercial banks financing defense contractors and governments.
Canada will host the institution, with Luxembourg serving as the European headquarters. Prime Minister Mark Carney is championing the initiative, with Isabelle Hudon, CEO of the Business Development Bank of Canada, acting as lead negotiator.
Founding members are expected to be revealed at the NATO summit in Ankara, Turkey, in July. Preliminary discussions involved 18 to 19 nations, with long-term plans to expand to 40 countries.
The bank aims to address a key financing gap for small and medium-sized defense supply chain companies that struggle to access capital due to ESG screening concerns. Institutional backing includes Canada's Big Six banks alongside global financial players like JPMorgan, ING, and Deutsche Bank.