New Leadership at Vatican Bank

The Pope has named a new team to oversee the Holy See’s financial dealings. Remembering Archbishop Marcinkus, and St. Anselm…

By Robert Moynihan, reporting from America

When Pope Benedict XVI became Pope at the age of 78 in 2005, some wondered if he would make any substantial changes in the Roman Curia.

At first, the answer was no.

Indeed, following the pattern common in Bavaria, where a new parish priest makes no changes at all for a full year out of respect for the previous pastor, Benedict, born and raised in Bavaria, made very few changes during his first year.

After that, he started making small changes, here and there, generally bringing in men he knew personally to serve as “his” men in the Curia.

And now, after four and half years, he has started to make some serious changes.

Yesterday, it was time for the Vatican bank.

“No man can serve two masters: Ye cannot serve God and Mammon.” —Jesus of Nazareth, Gospel of Matthew 6:24, Gospel of Luke 16:13

It is the first rule of journalism to “follow the money,” and there is much to be said for that rule.

Money means all the forms of wealth this world contains.

“Mammon,” Jesus called it.

He referred to it as the alternative to God.

He said that human beings often come to a crossroads and must decide whom they will serve, God or Mammon — and they cannot serve both.

So the handling of the Church’s money, the Vatican’s money, is not a minor matter.

It is an important matter.

And it is a matter easily mishandled, and it has been mishandled, often, in the past.

Here are excerpts from the Wall Street Journal’s report on the story today, with a link to the entire article:

Vatican Revamps Its Bank’s Ranks

By Stacy Meichtry
VATICAN CITY, SEPTEMBER 24, 2009 — The Holy See announced a sweeping overhaul of the Vatican bank’s management as part of Pope Benedict XVI’s push for greater transparency at one of the world’s most secretive financial institutions.

In a statement Wednesday, the Holy See said it had appointed Ettore Gotti Tedeschi, who headed an Italian unit of Banco Santander SA, as the new head of the Vatican bank, which is called the Istituto per le Opere di Religione, or IOR. The Holy See also replaced the IOR’s management board.

The appointment marks the end of Angelo Caloia’s two decades at the helm of the IOR — a run that made him one of the Vatican’s most powerful and deeply entrenched officials. Mr. Caloia, an Italian banker and economist, was the first noncleric to run the IOR…

In his new post, Mr. Gotti Tedeschi will lead the IOR’s “management board,” a body of laymen who oversee the bank’s operations. The Holy See also named new members to the supervisory board, including Carl Anderson, chief executive of the Knights of Columbus, a Catholic group based in New Haven, Conn., and a member of several Vatican advisory bodies.

—Davide Berretta contributed to this article.

The same story was reported with a slightly different emphasis by Catholic News Service, the news service of the US bishops, which led with the American angle. (I find CNS generally reliable, and read it with great attention, but it sometimes has an “American” slant — as is natural — and this story shows that. The story leads with the Anderson appointment, and then mentions the Tedeschi appointment. And it adds a second name not mentioned in the Wall Street Journal report: that of Renaldo Hermann Schmitz):

Knights of Columbus leader named to Vatican bank supervisory panel

By John Thavis, Catholic News Service

VATICAN CITY (CNS) — The head of the Knights of Columbus has been named by Pope Benedict XVI to a five-member council that supervises the activities of the Vatican bank.

Supreme Knight Carl A. Anderson, who heads the 1.7 million-member fraternal organization, was among three new council members announced by the Vatican Sept. 23…

Leaving his post on the council was Virgil Dechant, who stepped down as head of the Knights of Columbus in 2000.

The Pope also named a new president of the council, Ettore Gotti Tedeschi, an Italian banker and a professor of financial ethics at the Catholic University of the Sacred Heart in Milan, and a new vice president, Ronaldo Hermann Schmitz, a retired German business manager…

Anderson, 58, also runs the Knights of Columbus insurance program, which has more than $14 billion in assets and $71 billion worth of insurance in force…

The Dow Jones news wire gave an even briefer report:

ROME (Dow Jones)–Ettore Gotti Tedeschi, head of the Italian unit of Spanish lender Banco Santander SA (STD), will replace Angelo Caloia as chairman of the Vatican bank Istituto per le Opere di Religione, the Holy See said Wednesday.

In a statement, the Vatican said IOR’s new vice-chairman is Ronaldo Hermann Schmitz.

Caloia has been the chairman of the Vatican bank for more than 20 years.


Let’s look a little bit closer at the backgrounds of the men chosen to handle the Vatican’s finances.

First, Tedeschi.

<jpeg>Here is a brief summary of the man and his work from the Italian Wikipedia website:

“Cattolico e liberale, Ettore Gotti Tedeschi (photo) ha scritto, con Rino Cammilleri, un libro che ha per titolo: Denaro e Paradiso. L’economia globale e il mondo cattolico, rivendica «la superiorità di un capitalismo ispirato alla morale cristiana».

“Avverso alle teorie keynesiane e all’idea che l’economia sia una scienza tout court, ritiene, sulla scorta delle ricerche degli economisti medievali Giovanni Ceccarelli eGiacomo Todeschini, che il capitalismo sia nato “con il saio” nell’Italia del XIII secolo, teorizzato da teologi francescani e che è invece il protestantesimo, il responsabile dei suoi successivi difetti: affarismo, decisionismo, laissez-faire, legge del più forte.

“Fra le sue dichiarazioni emerge un ruolo molto forte nella sua conversione di Alleanza Cattolica. E’ considerato da decenni, uno degli economisti più vicini all’Opus Dei. E’ intellettuale gradito alla destra cattolica italiana.”

Here is a quick, rough English translation:

“Catholic and liberal, Ettore Gotti Tedeschi has written, with Rino Cammilleri, a book entitled Money and Paradise: The Global Economy and the Catholic World, claiming ‘the superiority of a capitalism inspired by Christian morality.’

“Opposed to the Keynesian theories and to the idea that the economy (or economics) is a science tout court, he holds, in light of his research into the scholars of medieval economic history Giovanni Ceccarelli and Giacomo Todeschini, that capitalism was born “with a Franciscan robe” in Italy in the 1200s — that is, invented by Franciscan theologians — and that it is rather Protestantism that is responsible for its (capitalism’s) successive defects: focusing on profit to the exclusion of everything else, running rough-shod over others, no (legal) restrictions on one’s activity, survival of the fittest.

“Among his declarations emerges a very strong role in his conversion to Alleanza Cattolica (Note: an orthodox Catholic group in Italy founded in 1960 to defend Catholic values; here is a link to their website: He has been considered for decades, one of the economists closest to Opus Dei. He is an intellectual pleasing to the Italian right.”

Second, Schmitz.

We are told by CNS that Ronaldo Schmitz is “a retired German business manager.”

However, a quick internet search reveals a bit more detail: Schmitz was born in Brazil, and he is a director of the Cabot Corporation in Boston, Massachusetts. He is also a former director of Deutsche Bank AG, one of the world’s largest banks, and also of GlaxoSmithKline plc, one of the world’s largest pharmaceutical corporations, and also of BASF AG, one of the world’s largest chemical companies,

Here is the “index card” on Schmitz posted on the Forbes website:

Ronaldo H. Schmitz

Cabot Corporation
Boston, MA
Sector: BASIC MATERIALS / Specialty Chemicals

70 Years Old
Ronaldo H. Schmitz, Business Experience: Deutsche Bank AG (banking): Former Executive Director Deutsche Bank Group; Member of the Group Board – 1991 to 2000 (retired); Executive Vice President – 1990. BASF AG (chemicals company): Member of the Board of Managing Directors – 1980 to 1990. Directorships: GlaxoSmithKline plc, Legal & General Group plc, Rohm and Haas Company and Sick AG.

(Here is the link: )

Another website, contains an additional piece of information.

(The site says: “What is NNDB? NNDB is an intelligence aggregator that tracks the activities of people we have determined to be noteworthy, both living and dead. Superficially, it seems much like a “Who’s Who”… But it mostly exists to document the connections between people, many of which are not always obvious. A person’s otherwise inexplicable behavior is often understood by examining the crowd that person has been associating with.” Note: NNDB has no entry for Ettore Gotti Tedeschi).

The new bit of information is at the end of the entry for Schmitz:

Ronaldo H. Schmitz
Born: 30-Oct-1938
Birthplace: Porto Alegre, Brazil

Gender: Male
Race or Ethnicity: White
Occupation: Business

Nationality: Germany
Executive summary: CFO of BASF, 1984-90

University: University of Cologne (1962)
University: MBA, INSEAD

Deutsche Bank EVP (1990-)
BASF CFO (1984-90)
Member of the Board of BASF (1989-90)
Member of the Board of Cabot (2001-)
Member of the Board of Deutsche Bank (1991-2000)
Member of the Board of GlaxoSmithKline (2000-)
Member of the Board of Glaxo Wellcome (-2000)
Member of the Board of Legal & General Group plc (2000-)
Member of the Board of Rohm and Haas (1992-)
Institute for Advanced Study Trustee
Trilateral Commission

(Here is the link:

Therefore, it seems that Schmitz is a member of the Trilateral Commission.

This is not to say what that might mean. It is simply a fact to be noted.

Schmitz is clearly an accomplished banker, capable of effectively and rapidly expanding a bank’s business, as the following May 6, 1992 article from the New York Times explains.

“Two years after having left BASF to become one of 13 managing directors at Deutsche Bank, the 54-year-old Mr. Schmitz is pushing the American branch to diversify its business and grow in areas more in demand among corporations — and more profitable for the bank,” the report said.

“Mr. Schmitz, who is based in Germany but spends much time in the United States running North American operations, is bold enough to foresee a time, several years hence, when the bank’s American business will be bolstered by a listing on the New York Stock Exchange and perhaps the acquisition of a major American bank or securities firm.

“Instead of a staid lender, the Deutsche Bank being assembled by Mr. Schmitz in North America will provide corporate customers a fuller package of services, including offerings of securities and financial advice.

“Mr. Schmitz acknowledges that his models are Bankers Trust and J. P. Morgan, two New York companies that have thrived by concentrating on trading and financial advisory services for large corporations and wealthy individuals.”


Many years ago, I often interviewed in Rome the American Archbishop at the center of the Vatican bank-Banco Ambrosiano scandal, Paul Marcinkus (photo), head of the Vatican bank in the 1970s and 1980s.

<jpeg>Archbishop Marcinkus, who was about 6 feet 6 inches tall and towered over almost everyone else at the Vatican, used to slap me on the back, and he helped me generously on several occasions when I was in a jam.

In the end, he told me, just before he left Rome in the early 1990s, to come to visit him “someday, before I die,” and that then “I will tell you things that will make your hair curl.”

I called the archbishop in February of 2006, and spoke with him at his residence in Sun City, Arizona. We had a good conversation, and I asked if I might come to visit him to have that conversation he had proposed almost 20 years before.

He died a few days later, on February 20.

<jpeg>(Here is a link to the Wikipedia summary of his life and work:

(Photo: Pope John Paul II with Archbishop Marcinkus in front of him.)

One must first believe in order to understand God’s truth, says Pope

During the Pope’s General Audience yesterday, September 23, in Rome, Pope Benedict said that understanding God will never come from study alone — one must first believe.

Theologians and Christians who wish to deepen their faith “cannot count on just their intelligence, but must cultivate a profound experience of faith at the same time,” he said.

The Pope’s catechesis was dedicated to the life and teachings of St. Anselm of Canterbury, an 11th-century Benedictine and Doctor of the Church.

According to Anselm, Benedict explained, people who wish to better understand the Christian tradition can carry out “a healthy theological quest” by following three steps.

First, one must have faith, which is “a free gift from God to be welcomed with humility.”

The second step is experience, which entails incorporating the word of God in one’s everyday life.

The final step is “true understanding, which is never a result of ascetic reasoning, but of contemplative intuition,” Benedict said.

The Pope then cited St. Anselm’s most famous phrase: “Nor do I seek to understand that I may believe, but I believe so that I may understand.”

The Pope concluded by saying that Anselm showed how the journey to understand God is never fully complete, at least here on earth.

(Here is a link to the text of the Pope’s remarks:

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