Institute for the Works of Religion

The Institute for the Works of Religion, commonly known as the Vatican Bank, is a financial institution that is situated inside Vatican City and run by a Board of Superintendence, which reports to a Commission of Cardinals and the Pope. It is not a private bank, as there are no owners or shareholders; it has been established in the form of a juridical canonical foundation, pursuant to its statutes. Since 9 July 2014, its president is Jean-Baptiste de Franssu. The IOR is regulated by the Vatican's financial supervisory authority, the Autorità di Supervisione e Informazione Finanziaria.
The Institute was founded in June 1942 by papal decree of Pope Pius XII. In June 2012, the IOR gave the first presentation of its operations. In July 2013, the Institute launched its own website. On 1 October 2013, it also published its first-ever annual report.
On 24 June 2013, Pope Francis created a special investigative Pontifical Commission to study IOR reform. On 7 April 2014, Pope Francis approved recommendations on the IOR's future which were jointly developed by the CRIOR and COSEA commissions and the IOR's management. "The IOR will continue to serve with prudence and provide specialized financial services to the Catholic Church worldwide", as the Vatican release stated. On 7 April 2014, Pope Francis approved a proposal on the Institute's future, "reaffirming the importance of the IOR's mission for the good of the Catholic Church, the Holy See and the Vatican City State". On 30 January 2023, with a Chirograph published on March 7, Pope Francis revised the Statute, reaffirming that the purpose of the Institute is "to provide for the custody and management of movable and immovable assets transferred or entrusted to it by individuals or legal entities, intended for works of religion or charity."
On 23 August 2022 Pope Francis signed a Rescript establishing that all financial resources of the Holy See and its associated institutions must be transferred to the Institute for the Works of Religion, which is to be considered the sole and exclusive entity responsible for asset management activities and the custodian of the Holy See's movable assets, as well as those of its departments, offices, and affiliated entities.

Origin and mission

The Istituto per le Opere di Religione was founded on 27 June 1942 by Pope Pius XII. It absorbed the Amministrazione per le Opere di Religione, which had originated in the Commission for Works of Charity established by Pope Leo XIII on 11 February 1887. The IOR is not a department of the Roman Curia, the central administrative structure of the Roman Catholic Church, nor is it a central bank.
The purpose of the IOR is "to provide for the safekeeping and administration of movable and immovable property transferred or entrusted to it by physical or juridical persons and intended for works of religion or charity".
In 2014, the Vatican officially confirmed the IOR's mission as provider of "specialized financial services to the Catholic Church worldwide." Furthermore, it was affirmed by the Vatican that the "valuable services that can be offered by the Institute assist the Holy Father in his mission as universal pastor and also aid those institutions and individuals who collaborate with him in his ministry".

Corporate governance

According to its Statutes, in effect since 2023, the IOR is composed of four bodies:
A Commission of Cardinals with five members, appointed for renewable five-year terms, who elect their president. As announced on 21 September 2020 the Commission's members, appointed for two years ad experimentum, are:

Christoph Schönborn, former Archbishop of Vienna – President
Luis Antonio Tagle, Pro-Prefect for the Section of Evangelization of Dicastery for Evangelization
Konrad Krajewski, Papal Almoner
Giuseppe Petrocchi, Archbishop of L'Aquila
Emil Paul Tscherrig, former nuncio to Italy and San Marino 2024.
Ángel Fernández Artime, S.D.B., Pro-Prefect of the Dicastery for Institutes of Consecrated Life and Societies of Apostolic Life

Pietro Parolin's office of Secretary of State was omitted from the new Commission.
The Prelate of the IOR, Mgr. Battista Ricca, appointed by the Supervisory Commission of Cardinals with the Pope's approval, acts as secretary of the Commission and attends meetings of the Board of Superintendence.
A Board of Superintendence, defining the strategy and ensuring oversight of operations.

Jean-Baptiste de Franssu, President
Javier Marín Romano
Georg Freiherr von Boeselager
Bernard Brenninkmeijer
François Pauly
Sheila Marie L. Uriarte-Tan
Elizabeth McCaul

A Directorate, in charge of operational activities and accountable to the Board of Superintendence.

Gian Franco Mammì – General Director
Financial information

Table with a comparison of IOR's financial performance over the last years.

Year	Total Equity	Net profit	Intermediation margin	Operating expenses	TIER 1 Ratio	Clients	Coverage of Catholic ethics principles
2024	731.915	32.759	51.506	23.752	69.4%		100%
2023	667.561	30.598	49.655	22.908	59.78%	12361	100%
2022	578.497	29.583	33.264	20.865	46.14%	12759	100%
2021	649.315	18.091	34.395	19.237	38.54%	14519	100%
2020	673.234	36.375	45.483	19.340	39.74%	14991	100%
2019	668.292	38.012	56.068	17.665	82.40%	14996	100%
2018	654.567	17.518	14.694	16.007	86.36%	14953	n.a.
2017	659.119	31.934	49.938	18.727	68.26%	14945	n.a.
2016	672.600	36.001	42.595	19.086	64.53%	14960	n.a.
2015	670.278	16.127	42.843	23.428	60.65%	14801	n.a.

Controversies

Historical allegations

When the Holy See, whose tax-exempt status on income from Italian investments was revoked in 1968, decided to diversify its holdings, it employed as financial adviser Michele Sindona. Once among the country's most powerful businessmen, subsequent investigations into his business affairs brought to light questionable associations with the Mafia as well as the secret P2, a Masonic lodge that the Italian Parliament classified as a subversive organization. The 1974 failure of Sindona's Franklin National Bank and the subsequent collapse of his financial empire, into which he had channeled part of the Holy See's investments, entailed losses for the Vatican estimated by one source at 35 billion Italian lire.
In 1982, a political and financial scandal connected with the collapse of Banco Ambrosiano involved the head of IOR from 1971 to 1989, Archbishop Paul Marcinkus, who allegedly had given "letters of patronage" on behalf of the IOR in support of the failed bank. In 1987, an Italian court issued a warrant against Marcinkus, whom they accused of being an accessory to fraudulent bankruptcy. Marcinkus evaded arrest by staying inside Vatican City until the warrant was dismissed in 1991, whereupon he returned to his home country, the United States. Chairman of the Banco Ambrosiano and member of the illegal Masonic lodge P2, Roberto Calvi was convicted of violating Italian currency laws and fled on a false passport to London where he was found murdered under Blackfriars Bridge in London some days after he went missing from Milan. The Istituto per le Opere di Religione, then a 10% shareholder of Banco Ambrosiano, denied legal responsibility for the Banco Ambrosiano's downfall but acknowledged "moral involvement", and paid US$224 million to creditors.
Several works published during the 1980s and 1990s were highly critical of the Institute for the Works of Religion's historical relations with anti-communist governments.
In reference other alleged covert activities, Tony Abse, writing in The Weekly Worker, an organ of the Communist Party of Great Britain, has said that the CIA used the Institute for the Works of Religion to funnel funds to the Solidarity Polish trade union "as part of the final offensive against the Soviet Union". The organization American Atheists says covert United States funds were channelled in the same way both to Solidarity and to Contra guerrillas.
Alperin v. Vatican Bank was a class action suit by Holocaust survivors against the Institute for the Works of Religion filed in San Francisco, California on 15 November 1999. The case was dismissed as a political question by the District Court for the Northern District of California in 2003, but reinstated in part by the Ninth Circuit Court of Appeals in 2005. That ruling has attracted attention as a precedent at the intersection of the Alien Tort Claims Act and the Foreign Sovereign Immunities Act. The complaint against the Vatican Bank was dismissed in 2007 on the basis of sovereign immunity.

Judicial events and reorganisation (2010–2018)

In 22 September 2010, Italian magistrates seized €23 million from the IOR, on the grounds that the anti-money laundering laws in force had been violated. The money was originally to be transferred from the Italian Credito Artigiano to JPMorgan Chase and another Italian bank,. Both the origin and destination of the funds were accounts under the control of the IOR. It was furthermore declared that Gotti Tedeschi and another IOR manager were under investigation for money laundering charges. On 31 May 2011, Rome's attorney general released the €23 million in assets which had been seized in September, apparently in acknowledgment of the steps taken in the following months to conform the Institute to international standards.
On 24 May 2012, Ettore Gotti Tedeschi was ousted as Head of the Vatican Bank because of his alleged "failure to fulfill the primary functions of his office". In July 2013, the money laundering case against Gotti Tedeschi was dropped. In March 2014, he was again acquitted by the Roman court that followed the public prosecutor's position and relieved Gotti Tedeschi from any responsibility in that operation.
On 15 June 2013, with the approval of Pope Francis, the Cardinals' Commission appointed Monsignor Battista Mario Salvatore Ricca as the Institute's Prelate ad interim. There was also speculation that opponents of reform might have withheld information about possible scandals in Ricca's past or that they might have made up unfounded rumours about Ricca's past. It was reported that Ricca had offered his resignation because of the controversy, but the head of the Holy See's Press Office declared the accusations as "not credible" and Pope Francis himself informed journalists that an inquiry "found nothing".
On 28 June 2013, three persons were arrested by the Italian police on suspicion of corruption and fraud. Allegedly, they had planned to smuggle €20 million in cash from Switzerland into Italy. One of the arrested was Monsignore Nunzio Scarano, previously senior accountant at APSA, the Vatican's Administration of the Patrimony of the Apostolic See. Subsequently, he was indicted with corruption and slander and set under house arrest.
On 21 January 2014, he was further charged with money laundering through IOR accounts in yet another investigation. According to a police statement, millions of euros in "false donations" from offshore companies had moved through Scarano's accounts. Already in July 2013, the IOR had frozen the money in Scarano's accounts. As news agency Reuters reported, Elena Guarino, the Salerno magistrate who led the investigation, told reporters "the Vatican was fully cooperative and gave her much information on Scarano's bank movements.". In January 2016, Scarano was acquitted of allegations of corruption, but was given a two-year sentence after being convicted of lesser charges of making false allegations. His money laundering trial in his hometown of Salerno was still pending at this time. The other person arrested was a bank person and a former secret service agent.
In February 2017, a court in Rome convicted two former top Vatican Bank officials Paolo Cipriani and Massimo Tulliof for omissions in communications involving three small transfers. Cipriani was a former Vatican bank director and Tulliof was Cipriani's former deputy. They were, however, acquitted of a more serious money laundering charge, which involved $60 million in transfers, and were sentenced to four months and ten days in prison. They were also forced to return $6,000 each.
In 2018, Vatican prosecutors indicted former Vatican Bank President Angelo Caloia, and an attorney, Gabriele Liuzzo, for embezzling $62 million, using a real estate scam, between 2001 and 2006. The trial is still pending.