LONDON / TORONTO — Britain will not join the Canada-led Defence Security and Resilience Bank (DSRB), according to a source familiar with the matter, Reuters reported on Sunday (October 25). The two countries said they would instead develop a framework for cooperation between their respective defence-funding initiatives.

Source: Reuters, Oct 25

In a joint statement on Sunday, the two governments said they had agreed to establish two distinct but complementary institutions to support each other on investment opportunities and strategic challenges. 'We have been working closely to consider how the Multilateral Defence Mechanism (MDM) and Defence, Security and Resilience Bank (DSRB) can best advance our shared objectives. We have agreed to develop a framework of cooperation that works in the interest of both institutions,' the statement said.

Source: UK–Canada joint statement, quoted by Reuters, Oct 25

Where they could not agree

According to another source cited by Reuters, the two governments were unable to agree on key issues including the location of the headquarters of the new bank, the level of joint procurement, lending to members, and the rules around new members joining in the future. Reuters said the DSRB has faced challenges securing support from larger European nations, and Britain had previously distanced itself from the project.

The source said Britain's MDM will focus on accelerating defence investment and joint procurement through financing, bringing together demand across NATO allies to reduce procurement costs, while Canada's DSRB will complement it by supporting investment in defence industries and supply chains, focusing more on single sovereign lending.

Britain and Canada said the MDM and DSRB will be designed to work in close partnership, so they can support each other on emerging industrial priorities, investment opportunities and strategic financing challenges. For Canada — home to a large Punjabi and Indian diaspora with deep interest in Ottawa's defence and foreign policy — the outcome means its flagship defence bank will proceed without Britain as a member, but with a formal cooperation link to London's separate mechanism.