Finnish Lutheran church is doing fine financially

Assets worth around EUR 2.7 billion

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The overall financial situation of the 421 parishes of the Evangelical Lutheran Church of Finland is comfortably in balance, even though the Church has been losing some of its membership.
     
The Church's tax revenues have been growing over the past four years because of higher taxable incomes following pay rises and the good financial results of businesses.
      According to a recent annual report, the financial result of the Church was in surplus by EUR 64 million in 2005.
      "It looks fine, the combined solvency of the parishes is good", says Maija-Liisa Hietakangas, who is in charge of financial planning at the Church Council.
      However, the economic inequality of the parishes is reportedly large. Moreover, one in four parishes had a negative financial result in 2005, and many of them were forced to accept financial support from the Central Church Fund.
     
The economic indicators have remained more or less the same since the turn of the millennium.
      The equity/assets ratio is close to a hundred which is a very good result. The parishes are almost or entirely free of debts. Furthermore, the 23 parishes showing a negative financial result at the end of the 2005 accounting period were able to cover their deficits through the surpluses accrued for the previous year.
      Moreover, the Church's major assets make the situation even better: buildings, forests, plots for development, and shares and securities.
      For example, the parishes own a total of 3,510 square kilometres of forest and land, which is roughly 19 times the land-area of the City of Helsinki.
      The total assets of the parishes have grown by EUR 250 million in the course of three years, currently totalling EUR 2.7 billion.
     
The process of combinig municipalities inevitably leads to parish mergers. The economic pressures facing some smaller parishes as well as changes in municipal divisions are the most important reasons for parish mergers.
      "If the solvency of a parish is poor, we would recommend either cooperation or a merger with a neighbouring parish", Hietakangas notes.
      "The selling off of property is not sustainable development", she argues.
     
The good financial situation is also attributable to the Church's investment in shares. The investment portfolio of the Evangelical Lutheran Church parishes was already worth EUR 481 million at the end of last year.
      Investments controlled by the Church's pension fund totalled EUR 655 million.
      The Evangelical Lutheran Church of Finland follows certain ethical principles in their investments. "Immoral lines of business include tobacco, alcohol, adult entertainment, and weapons."


Links:
  The Evangelical Lutheran Church of Finland

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