| VATICAN CITY, July 7
VATICAN CITY, July 7 The Vatican bank will soon
hive off its investment activities and transform itself into an
institution dedicated mostly to payment services for the Roman
Catholic Church, Vatican sources said on Monday.
The details of the down-sizing will be announced on
Wednesday by Australian Cardinal George Pell, who heads the
Secretariat of the Economy set up earlier this year to oversee
Vatican finances and stem scandals that have embarrassed the
Church for decades.
The sources said French businessman Jean-Baptise de Franssu
is expected to be named as the new head of the bank, formally
known as the Institute for Works of Religion (IOR). He will
succeed German Ernst von Freyberg, who is leaving after
instituting major reforms..
Under the expected changes, the IOR will no longer have
asset management functions. Its remit will be restricted to
providing payment services and financial advice for religious
orders, charities and Vatican employees.
The Holy See's assets are expected to be managed by a newly
created department, the sources added. The radical overhaul of
the bank will be announced a day after the IOR publishes its
performance numbers for 2013 on Tuesday.
The new statues of the bank are expected to make the
chairman's job a full-time residential position.
Freyberg, who was appointed to the bank in 2013 in one of
the last decisions made by former Pope Benedict before he
resigned, had been dividing his time between Germany and Rome.
AT CENTRE OF SCANDALS
Under Freyberg's leadership, the IOR closed hundreds of
accounts, instituted strict anti-money laundering regulations
and launched several investigations into suspicious activities.
The changes in the IOR were finalised by Pell and the pope's
other economic advisors last Saturday.
Francis, who was elected in March, 2013, had considered
closing the bank but he decided to keep it operative but with a
programme of continuing reforms.
Francis also appointed a Council for the Economy, a
15-member group of prelates and lay people from around the world
that will set economic policy for the Holy See and for the
Secretariat for the Economy. De Franssu has been appointed to
The IOR has been at the centre of scandals in recent years.
Monsignor Nunzio Scarano, who worked as a senior accountant
in another Vatican department for 22 years with close ties to
the IOR, is now on trial accused of plotting to smuggle millions
of dollars into Italy from Switzerland to help rich friends
Scarano has also been indicted on charges of laundering
millions of euros through the IOR. He says the money in his
accounts at the IOR were donations, which Italian magistrates
dispute. He was arrested in June 2013.
(Reporting By Philip Pullella; Editing by Tom Heneghan)