Pope Cuts Scandal-prone Vatican Bank down to Size

By Rachel Sanderson
Financial Times
July 7, 2014

http://www.ft.com/intl/cms/s/0/24a7e7ea-05df-11e4-9baa-00144feab7de.html#axzz36oK0VL4B

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The Institute for Religious Works, the official name of the scandal-prone Vatican bank, is set to be radically slimmed down as part of Pope Francis's mission to refocus the Catholic Church to supporting the poor and needy, according to insiders.

The overhaul, due to be unveiled this week alongside the publication of the bank’s annual report – only its second ever – is expected to strip the 127 year-old institution of most of its powers to manage assets. The bank, where decades of corruption and mismanagement did much to tarnish the image of the Vatican, will return to its original purpose of sending funds to missionaries and Church groups around the world.

By removing the asset management functions Vatican officials hope to cut out the source of the much of the scandal that has plagued the bank since the 1980s when Roberto Calvi, dubbed “God’s banker”, was found hanged under Blackfriars Bridge in London.

Jean-Baptiste de Franssu, former chief executive of Investco Europe, is on the shortlist to be named the new head of the Vatican bank in an attempt to boost its reputation for financial discipline, according to a person familiar with the matter.

“We cannot have any more scandal,” said a person close to the pope.