Most people expected Pope Leo XIV to run the Vatican in a different manner than his predecessor, Pope Francis, and we’re now starting to get some insight into one area where he is making a change: Leo is rolling back some of the reforms made by Francis concerning the Catholic Church’s finances. While Francis was considered one of the most liberal popes in history, his financial reforms created controversy. Some believed they concentrated too much power in the Vatican, which has long generated questions about its economics. But Leo may be taking the church in a different direction.
What is Leo doing about the Vatican’s finances?
The pope is working to change some of the rules that have caused financial stress within the church. Leo has started “correcting some of Pope Francis’ more questionable financial reforms and decisions,” said The Associated Press. The most notable of these is the repealing of a 2022 law that had “concentrated financial power in the Vatican bank.”
This law had stated that the Catholic Church’s assets were to be managed by the Institute of Religious Works (IOR), the Vatican’s official bank. But Leo’s decree now says the church should “use the IOR, but can turn to non-Vatican banks in other countries” if the church deems it “more efficient or convenient,” said the AP. This marks the “clearest sign yet that Leo is starting to fix some of Francis’ more problematic decisions and is recalibrating the Vatican’s centers of power.”
Francis’ decision to sign this law was “widely understood to be a response to the financial scandals around the Secretariat of State, and to a mounting liquidity crisis,” said Catholic news outlet The Pillar. But it had also “taken many in the Vatican by surprise since it appeared to contradict the Holy See’s founding constitution,” said the AP, as the “constitution says the patrimony office, APSA, is responsible for administering the Vatican’s real estate and financial holdings,” not the IOR.
How could this affect the Catholic Church?
Leo is trying to shore up some of the “Vatican’s infamously troubled finances,” said Fortune, and hopes that decentralizing all power in the church’s central bank will be the first step toward this. The Catholic Church’s “financial reputation has been tarnished in past decades by its opaque finances and cases of corruption, embezzlement, and other crimes,” said Reuters. While the church wanted to make moves to counter this reputation, some officials in the Vatican thought Francis’ law had “given the bank too much power over other Vatican departments, which could not even have investments in banks in nearby Italy.”
Even Francis “realized the problem and had intended to fix it, Vatican officials said, but died in April before he could,” said the AP. And it seems that Leo agrees; while the pope has some similar viewpoints on major church issues as his predecessor, he has “quietly distanced himself from one of Francis’ more centralizing financial measures,” said The Catholic Herald.
Leo’s decision may signify a significant turning point for the Vatican. His choice to undo Francis’ law “restores a measure of flexibility, allowing the Vatican Bank to play a more active role and permitting the use of external financial intermediaries when deemed appropriate,” said the Herald. This “marks the first real step in Vatican finances under Leo — but it’s unclear which direction things are headed,” said The Pillar.
Leo has been working to change some decisions made by his predecessor
