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Banks Change Course on Weapons Finance as Defense Spending Soars

  • Commerzbank, SEB signal openness to arms industry amid war
  • Germany says Russian war ushers in ‘new era’ for military
A convoy of armored vehicles of the German armed forces arrive at the NATO enhanced Forward Presence Battle Group Battalion in Rukla, Lithuania on Feb. 17.

A convoy of armored vehicles of the German armed forces arrive at the NATO enhanced Forward Presence Battle Group Battalion in Rukla, Lithuania on Feb. 17.

Photographer: Petras Malukas/AFP/Getty Images
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After years spent treating weapons manufacturers with caution, bankers in Europe are now positioning themselves for closer relations with the defense industry.

Russia’s war on Ukraine has led Germany -- Europe’s biggest economy -- to abandon its decades-old aversion to military spending, and instead embrace what Chancellor Olaf Scholz has called a “new era” of investment. For banks and asset managers, the development means a group of clients that until recently had been kept at arm’s length is now being invited to seek financing.