The Vatican announced Wednesday sweeping changes that will affect its pension and money management operations, creating a new money manager in the process.
Assets under management at the Vatican bank Istituto per le Opere di Religione, which provides money management services to Vatican employees, will shift to the new Vatican Asset Management, “in order to overcome duplication of efforts in this field among Vatican institutions,” said a news release from the Vatican.
Over the next three years, IOR will be redesigned with the aim of strengthening its business foundation and refocusing its efforts on financial advice and payment services for clergy, congregations, dioceses and lay Vatican employees.
“We are working so that international financial standards will be followed in all the … sections of the Holy See,” said Cardinal George Pell at a news conference Wednesday. “Our ambition is to become something of a model of financial management, rather than a cause for occasional scandal.”
Also on Wednesday, Jean-Baptiste de Franssu, former president of the European Fund and Asset Management Association, was appointed president of the IOR, replacing Ernst von Freyberg.
The IOR, which had €3.3 billion ($4.5 billion) of assets under management as of Dec. 31, invests more than 95% of its assets internally across fixed interest securities, government bonds and money market accounts — with the remainder invested in externally managed funds and equities.
Six new lay members have been appointed to the board of the IOR, including Sir Michael Hintze, founder and CEO of hedge fund CQS.
At the news conference, Mr. Pell, the cardinal prefect of the Secretariat for the Economy at the Vatican, said the changes were necessary following recommendations by a special commission, known as COSEA.
“There are many challenges and much work ahead,” the cardinal said in the Vatican news release. “It is clear from the work of COSEA that a number of issues, such as the … pension fund … and IOR need to be addressed urgently.”
Mr. Pell also announced the formation of a technical committee to look at the pension fund and to make proposals by the end of the year. The news release said, “the fund needs to ensure there are sufficient funds for future generations in a changing environment.” The size of the pension fund could not be learned by press time.
Spokesman for IOR and the Vatican could not be reached for comment by press time.