ROME -- Pope Francis has given his backing to the Vatican's scandal-ridden bank, Vatican officials said Monday, quashing months of speculation that he might close it down as part of wide-ranging reforms at the Holy See.
In a statement, the Vatican said the bank "will continue to serve with prudence and provide specialized financial services to the [Roman] Catholic Church worldwide."
Set up in 1942 to offer accounts to priests, nuns, religious orders and Vatican employees, the bank has been embroiled in a series of scandals over alleged money-laundering and tax-dodging.
Francis, who has called for a "poor church" that eschews wealth and luxury and who once declared that "St. Paul did not have a bank account," said in July that he was undecided what to do with the bank, which is known by its Italian acronym, the IOR.
"I don't know what will become of the bank," he said. "Some say it is better that it is a bank, others that it should be a charitable fund and others say close it."
The pope's decision to save the IOR reflects the promising results of a transparency drive launched by his predecessor, Benedict XVI, which has seen the bank adopt internationally approved standards and procedures. An investigation of the bank's 18,900 accounts is due to conclude this summer; dozens of lay account holders who do not match the bank's new tightened-up customer profile have been ordered to close their accounts.
In December, Moneyval, a Europe-wide monitoring committee, said the Vatican had made real progress in its reform program since the committee's first report in 2012.
The Vatican statement said Francis had reaffirmed "the importance of the IOR's mission for the good of the Catholic Church, the Holy See and the Vatican City State." Improvements made to date in compliance were "critical" for the bank's future, the statement added.
The road to transparency has not been smooth. Last month, Italian magistrates said that two former senior managers at the bank, Paolo Cipriani and Massimo Tulli, would stand trial on charges of violating money-laundering regulations. The two managers were allegedly close to senior prelate Nunzio Scarano, a Vatican functionary who is on trial on charges of trying to smuggle the equivalent of about $27.5 million into Italy in a tax-dodging scam.
The statement said that the IOR would continue to be monitored by a supervisory body known as the Financial Information Authority, launched in 2011 by Benedict and given extra powers last year by Francis.
Max Hohenberg, a spokesman for the bank, said the announcement on Monday "represents a powerful endorsement of our very mission and the hard work accomplished over the past 12 months."
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Kington is a special correspondent.
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