Holy orders lose €1.5m in Lehman crash
The financial crisis has had some unexpected victims, it was revealed last week. The Flemish religious order the Brothers of Love lost €500,000 in the collapse of US bank Lehman Brothers, while the Sisters of St Vincent, whose nunnery is in Gijzegem, lost €1 million.
Cloistered orders are non-profit partnerships like any other, explained managing director of the Brothers, Raf De Rycke. “We have money to invest. It would be a sign of bad management if we were to leave it sitting in the bank while awaiting a missionary project.”
The order invested in Lehman products without realising how risky the derivatives were, De Rycke said. “We are very cautious investors. We have a committee which screens our investments for risk. Nobody saw the failure of Lehman Brothers coming,” he said.
In Gijzegem, meanwhile, the Sisters declined to comment on their case. Religious orders are forced to invest wisely in large part because their members are getting older, and young people are not joining up to keep things going.
The Brothers of Love have no intention of turning their backs on the investment market, De Rycke said. “It would not be wise to stop investing. We simply have to make sure we don’t put all our eggs in one basket.”