Vatican bank president praises institute’s soundness

May 31, 2013

In a lengthy interview with Vatican Radio, the new head of the Institute for Religious Works (IOR), popularly known as the Vatican bank, praised the institute’s financial and ethical soundness and said that public relations has been his principal task.

“My dream is a very clear one,” said Ernst von Freyberg. “My dream is that our reputation is such that people don’t think of us any more, when they think about the Vatican, but that they listen to what the Pope says.”

“We are not a bank,” he explained. “We do not lend money, we do not make direct investments, we do not act as financial counterparts so you cannot get a swatch or a hedge from us. We do not speculate in currency or commodities, our core is we receive money as deposits and we then invest it in government bonds, some corporate bonds and in the inter-banking market where we deposit with other banks, for a slightly higher interest rate than we receive in order to be able to give it back to our customers whenever they want it.”

“We contribute on average 55 million Euro ($71.7 million) to the budget of the Vatican and are one of the important economic pillars,” Freyberg continued. “There are 112 people in the IOR who have 19.000 customers. By far the largest amount of them are nuns or clergy, and very often they know the person who deals with them at the IOR for 20 or 30 years. We know exactly what they need, they have a trusted person here and it is this personal relationship which makes them come here.”

“The IOR is highly capitalized, it has an equity of roughly 800 million on a balance sheet of 5 billion,” he said. “That is double of what you would get at banks outside the Vatican. During the financial crisis we were never in trouble. No government had to bail us out; we are very, very safe.”

“We haven’t rendered a good service to the Holy Father with the reputation we have and this reputation obscures the message,” Freyberg added. “And that I consider my first and most important task to address.”

Describing the IOR as “a well-managed, clean financial institution,” he explained that

We can improve on all areas as can everybody else and we are trying to be as good as the comparable institutes are. Then we need to communicate. In the past we haven’t spoken with anyone, beginning with our own closest constituents. We haven’t spoken to the cardinals in a systematic way, we haven’t spoken to the curia, we haven’t spoken to the Church.

It is the right of every member of the Catholic Church around the world to be well informed about this institution. What do we do now? We start speaking to the media, we speak inside the Church and inform in a systematic way our key constituencies, and we will publish an annual report as any other financial institution would do and we will put that on the internet on the 1st of October, on our own website.

 

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Further information:

• Interview with IOR President, Ernst von Freyberg (Vatican Radio)
• New president named for Vatican bank (CWN, 2/13)