Lay Directors Named to Run Vatican Bank Rocked by ’82 Scandal

In a major shake-up prompted by the scandal that depleted its coffers, the Vatican on Tuesday announced appointments to an international board of lay directors that will run the Vatican bank.

Vatican spokesman Joaquin Navarro-Valls said the board, or Supervisory Council, would meet for the first time on July 18, when U.S. Archbishop Paul Marcinkus was expected to formally end his involvement with the bank after 18 years as president.

Marcinkus was caught up in the damaging 1982 scandal in which the bank, known officially as the Institute for Religious Work, was linked to the alleged fraudulent collapse of Italy’s private Banco Ambrosiano.

A statement said the board of five bankers and businessmen from Italy, Spain, Switzerland, West Germany and the United States had been named by a control commission of cardinals appointed by Pope John Paul II as the bank’s supreme authority.

It is the first time in the 47-year history of the bank that laymen have exerted such powerful control over its affairs.

The board will be responsible for the administration and management of the bank and will oversee its financial activities in much the same way as the board of a commercial bank, Navarro-Valls said.

It will also nominate a lay director and deputy director to be responsible for day-to-day operations, replacing the post of president, and three lay auditors.

The board members, all Catholics, are Angelo Caloia, president of Italy’s Mediocredito Lombardo; Thomas Macioce, a New York lawyer and chairman of Allied Stores Corp.; Jose Angel Sanchez Asiain, president of the Spanish Banco Bilbao Vizcaya; Philippe de Weck, a former president of Union de Banques Suisses, and Theodor Pietzcer, a director of West German Deutsche Bank.

The sweeping reforms were first announced in outline form in March after a commission of 15 Roman Catholic cardinals met to discuss the Vatican’s mounting budget deficit.

The changes are widely regarded as a response to calls for greater transparency at the Institute for Religious Work, whose links to the Banco Ambrosiano affair prompted a drop in contributions to Vatican coffers from Catholics around the world.

The Vatican bank owned a small part of Banco Ambrosiano, whose Chairman Roberto Calvi was found hanging under London’s Blackfriars Bridge shortly after his bank collapsed with $1.2 billion in debts.

The Vatican denied any responsibility for the scandal but paid $250 million to Ambrosiano creditors in what it called a good-will gesture.

Italy’s constitutional court last year definitively quashed arrest warrants against Marcinkus and two Vatican bank executives on charges of fraudulent bankruptcy in the Banco Ambrosiano case.

Marcinkus was asked in March to help with the transition of the bank but his future has not been formally announced. Vatican sources say they expect him to devote his time to another job he already holds as governor of Vatican City.

Tuesday’s statement said the control commission of cardinals had also appointed Italian Monsignor Donato de Bonis to act as prelate to the Institute for Religious Work under the new statutes.

De Bonis, currently listed as the bank’s secretary general, will essentially be a liaison between the control commission and the board, but Navarro-Valls said he would have no executive powers.