A CATHOLIC Church diocese yesterday admitted it has lost millions of euro as a result of the financial markets crash.The Bishop of Killaloe, Dr Willie Walsh, revealed the diocese is in dire financial straits and has lost as much as €7m as stocks and shares plummeted.
And many other dioceses around the country have suffered due to investments plummeting in value.
The Archdiocese of Dublin, the largest in the country, has already instituted a pay freeze.
But Killaloe is understood to be the worst hit and Dr Walsh confirmed he and the diocese's 100 priests had taken a pay cut after an "unprecedented" shortfall in funds emerged.
The paper loss in the diocese's bank shares could amount to as much as €6m to €7m.
"What was done over the years was that the money was invested safely as we all believed -- most of it in bank shares," Dr Walsh said.
"Bank shares were regarded as a safe investment. We wouldn't be gambling or anything like that. We got dividends from bank shares each year," he said.
Dr Walsh estimated the value of their investment portfolio had slumped to around €2m, including a diocesan benevolent fund, compared to a value of between €8m and €9m at the height of the stock market boom.
The share value and annual dividends had allowed the diocese to give away land valued at €8m to €9m a couple of years ago for sheltered housing schemes.
A number of the other 25 dioceses throughout the country confirmed their investment income had been hit. But the problem did not appear to match the "unprecedented" shortfall identified in Killaloe.
Salaries
Killaloe is the second largest in the country, in geographical terms, spanning part of counties Clare, Offaly, Tipperary, Laois and Limerick.
The 8pc to 12pc reduction in priests' salaries in Killaloe, which amount to between €20,000 to €25,000 a year, will result in a saving of more than €200,000.
Each parish has also agreed to increase their diocesan contribution out of its collections from 12.5pc to 18pc of their income.
"The response from the parishes has been very good. They accepted the fact even the wisest people, who have more knowledge than us of the stock market, lost money through shares," he said.
Over the past 100 years the diocese invested in shares from the monies it received in wills from individuals, who had attached conditions to their bequests that it be used for a specific purpose or particular charity.
Philosophical about the loss, Dr Walsh said: "We will survive, there are none of us going to go hungry."
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