While the Catholic Church continues to repent for certain moral and legal wrongdoings, the institution finds itself struggling financially. Among the efforts to make the financial dealings of the Vatican more transparent, Vatican bank chief Ernst von Freyberg will step down and French financier Jean-Baptiste de Franssu will take his place.
Von Freyberg was appointed head of the bank under former Pope Benedict just before he retired, during a scandal alleging that the Vatican bank had been used in a money laundering scheme. As Pope Francis seeks to remove corruption and financial abuses from his church, it seems appropriate that a new bank head would be appointed.
With this shift, the bank will also give up investment activities. Instead, it will focus on religious orders and charities. The banking system will also become more transparent. The Vatican has created a new economic affairs department, which will be led by Cardinal George Pell. Cardinal Pell previously headed the Catholic Church in Australia. Pell will oversee all financial dealings and report to the Pope regularly. For the last year, he has been cleaning up existing Vatican accounts. "Our ambition is to become something of a model for financial management rather than cause for occasional scandal," Cardinal Pell told BBC News.
Right now, the Vatican bank is suffering from major financial woes. In 2012, they had profits of 86.6 million euros. In 2013, profits were just 2.9 million euros. This massive loss is attributed to investments, bringing in anti-money laundering experts, and 3,000 customers leaving the bank.
Holy See, the administrative branch of the Catholic Church, also faced a deficit last year of 24.2 million euros. The Vatican City state was able to turn a hefty profit though. Thanks to ticket sales from their museums, they profited 32.3 million euros in 2013.
Pope Francis has made it very clear he wants the Catholic Church to shape up financially. In 2013, he suspended German Bishop Franz-Peter Tebartz-van Elst for his lavish spending, which included a $20,000 bathtub and $1.1 million garden.
This article is from the archive of our partner The Wire.