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Church in Malta Reports €8.8 Million Deficit

Church in Malta Reports €8.8 Million Deficit
by
August 8, 2023
in Banking, Business News, NEWS Malta
288

In the year 2022, the Archdiocese of Malta faced a financial challenge, registering a deficit of €8.79 million. This deficit was a result of a tumultuous year for investments, driven by factors such as inflation, rising interest rates, and the ongoing conflict in Ukraine. Despite these financial hardships, the Archdiocese demonstrated its commitment to charitable activities by more than doubling its donations to those in need and increasing subsidies to various entities by 20%.

A Challenging Financial Landscape

Addressing the media during a press conference about the annual financial report of the Church in Malta, Administrative Secretary Michael Pace Ross explained that the negative global economic circumstances had a significant impact on the Archdiocese’s income. The losses and provisions for impairment on investments accounted for a substantial portion, totaling €5.21 million of the deficit.

Aiding Those in Need

The Archdiocese, comprising over 100 entities and employing 1,302 staff members, maintained its focus on its charitable mission. Despite the challenges, Pace Ross emphasized that the Church extended its pastoral efforts by employing more workers in this capacity. Notably, even with the closure of Dar Sagra Familja in Naxxar the previous year, no one lost their employment.

To address the increasing needs, the Church doubled its donations and provided assistance for basic necessities within Maltese parishes. These contributions amounted to a total of €1.21 million, reflecting the Church’s commitment to supporting its community.

Rising Income and Expenditure

Both the Church’s income and expenditure saw notable increases. Operating income surged by €1.58 million in 2022. The total income recorded was €10,276,873, up from €7.8 million in 2021. The increase in investment income was particularly significant, driven by dividends received from APS bank. Investment income rose to €8.39 million, with €5.19 million attributed to dividends from APS bank.

Collections and donations received by parishes experienced a 17% increase compared to the previous year, amounting to €1.6 million. This growth was fueled by an uptick in mass attendance and the return of feasts following the pandemic, although they did not reach pre-pandemic levels.

Challenges and Dilution of Shareholding

While the Archdiocese faced a decrease of €0.45 million in inheritances and a 23% drop in income from fundraising activities, Pace Ross noted the dilution of the Church’s shareholding in APS bank following the initial public offering in June 2022. The shareholding was reduced from 80% to 55%, impacting the Archdiocese’s ability to make cash injections into the bank.

Expenditure and Assistance

The Archdiocese’s expenditure increased to €55.8 million in 2022 from €48.5 million in 2021. Notably, renumeration to priests and lay employees accounted for 60% of all expenditure, amounting to €33.6 million. Over €1.2 million were distributed among vulnerable groups. The Archdiocese also incurred a one-time expense of €902,741 for the papal visit.

Government assistance related to Covid-19 reached €1.59 million in 2022, up from €1.24 million in the previous year. Government funding also increased by €2.57 million, primarily benefiting the Archbishop’s Seminary and Sacred Heart schools.

Curia’s Financial Position

Pace Ross also provided insights into the financial position of the Archbishop’s Curia in 2022, which recorded a net deficit of €2 million compared to €2.3 million in 2021. This deficit factored in losses, provisions for impairment on investments, and subsidies to various diocesan entities. The Curia’s income increased by €2.43 million, with the main contributor being investment income from APS bank.

Commitment to Service

Amid financial challenges, the Curia remained committed to its mission. It allocated €900,000 for the papal visit and subsidized its media section with €321,159. The subsidies primarily supported children’s homes, the Foundation for Theological Studies, and homes for the elderly.

In conclusion, the Archdiocese of Malta’s financial report for 2022 paints a portrait of resilience, commitment to charity, and adaptation in the face of economic complexities.

Frequently Asked Questions about the Archdiocese’s Financial Report

What contributed to the Archdiocese’s deficit in 2022?

The deficit in 2022 was primarily driven by losses and provisions for impairment on investments, which accounted for €5.21 million of the deficit.

How did the Archdiocese respond to increasing needs within the community?

Despite financial challenges, the Church doubled its donations and provided assistance for basic necessities in Maltese parishes, totaling €1.21 million.

What factors led to the increase in the Church’s income in 2022?

Investment income, particularly dividends from APS bank, played a significant role in the increase in the Church’s income in 2022.

How did the Archdiocese’s shareholding in APS bank change in 2022?

Following the initial public offering in June 2022, the Archdiocese’s shareholding in APS bank was diluted from 80% to 55%.

What efforts did the Archdiocese make to address challenges posed by the pandemic?

The Archdiocese provided government Covid-19 assistance, which increased to €1.59 million in 2022, and government funding also increased, primarily benefiting educational institutions.

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