The Vatican is set to streamline the financial investments of its institutions, in a bid by Pope Francis to reform the financial and investment arm that has tarnished the reputation of the Catholic church in recent times.

Last month, the Vatican has been rocked by a scandal centred around the costly purchase of a prestigious building in London as part of the Holy See’s investment activities. The Holy See spent €350 million (£290 million) on the property, while the previous owner had bought it for £129 million. According to reports, much of those Vatican funds came in form of donations.

With new measures announced on Tuesday, all Vatican bodies, ministries and organizations will have to transfer their financial assets or cash balances to the Administration of the Patrimony of the Apostolic See, or APSA, which acts as the Vatican’s central bank. There, the funds will be managed in line with the church’s principles and “contribute to a more just and sustainable world.”

The policy, as first reported by Bloomberg, states that, in general, investments in complex financial and structured products will be avoided, and that “strict compliance with international standards and official regulators’ guidelines” will be followed.

Going forward, the Vatican will refrain from investment in sectors that are contrary to church doctrines, such as defence and gambling. Sectors like oil and mining, nuclear energy and alcoholic beverages “are not excluded but should generally be avoided.”

The Vatican has since long held negative views about gambling and complex financial instruments. “Legalizing gambling fuels addictions, creates more and more compulsive gamblers, and using the industry as a source of tax revenue is unethical,” said Dicastery for Promoting Integral Human Development, a dicastery of the Roman curia in 2018.

In 2018, Pope said credit default swaps “encouraged the growth of a finance of chance and of gambling on the failure of others, which is unacceptable from the ethical point of view”. The instruments, he said, were “a ticking time bomb”.