Church of Greece Plans Digital Bank, Wants Diaspora Deposits

Source: The National Herald

By TNH Staff

ATHENS – With investment opportunities growing in everything from bitcoins to online lenders, the Church of Greece is readying an application for a license to establish a digital bank in the next few months.

It’s been planned quietly for several years, said Kathimerini, a source not named saying that it’s created debate among the clergy and whether it’s appropriate for the church to be involved in the field that includes lending and sometimes foreclosures.

The report said the documents would be submitted to the Bank of Greece by May or early June, moving swiftly to get into the field, and that it would be for just a digital bank online with no physical branches, customers using phones or computers only.

“It will be a very modern electronic bank and it will not use Church assets as collateral,” a source emphasized, rejecting speculation that it would function as a so-called “Holy Bank.”

But it has created a division, with some church officials supporting the idea in a country where up to 90 percent of the population identifies with the Greek Orthodox Church, creating an instant devoted constituency.

The Church is not contributing financial capital, wanting investors to put their money in. If approved, the bank is expected to expand operations beyond Greece, targeting Greek diaspora communities worldwide.

There’s skepticism within the church. “Let’s see when results start emerging if Bishops will gradually want to become shareholders,” one insider not named told the paper, and there’s concern about how Greece’s other banks will view the Church being a competitor.

“We are not becoming the Vatican,” a Church source said, saying there’s no comparison with the Holy See, where there have been a number of financial scandals involving top Catholic church leaders.

The Greek Church initiative is backed by Financial Innovation Holding, with former Postal Savings Bank President Angelos Filippidis the leading proponent, five years after fraud charges were dropped against him over bad loans.

There was no evidence, a prosecutor said, to suggest the defendant had deceived the bank’s board into approving hundreds of unsecured loans but no explanation of 400 million euros ($432.18 million) went before the bank was liquidated.

Filippidis also was accused at one point of having accepted bribes for issuing his approvals, the German state broadcaster Deutsche Welle said in 2014 when the scandal broke, involving 39 people who were then questioned.

Filippidis was detained in Constantinople, leading to speculation, the news site said, that he had put money in Turkish banks and as prosecutors were looking into allegations of secret accounts in Switzerland and Montenegro.The Greek national bank had warned the Postbank against making unnecessarily risky investments but those were ignored, leading the national stability mechanism to subsidize the losses but the bank still failed.