The financial industry, assailed from every side for its role in the global recession, has found an unlikely defender — the Church of England.
Yes, some sectors needed to be more closely monitored, but the church thinks hedge funds are still necessary, The Financial Times reported.
Addressing the House of Lord’s EU select committee, church commissioners raised “serious concerns” about EU plans to crack down on hedge funds.
Last year the CoE came out against short-sellers, via Bloomberg:
Short-Sellers `Clearly Bank Robbers,' Says Archbishop
Following the Archbishop's comments the Daily Mail reported:
'Practice what you Preach'
So there you go.
What could cause this type of hypocritical behaviour in an irrelevant (check attendance any Sunday) institution? From Ekklesia, Nov. 6, 2008:
Church of England faces investment gloom
The Church of England is expected to be praying for a big interest rate cut this morning from the Bank of England, as it faces further gloom over its investments.
The Church Commissioners had £13m invested in Man Group at the end of last year, the largest listed hedge fund manager. However, this morning the company was down 30% in early trading after its profits slumped - potentially wiping £4 million off the value of the Church's investment, overnight.
The Commissioners have announced an average return on the Church of England's investments of just under 10% a year over the last ten years. But most of its investments are in property and equities, which have both taken a hammering over the last year as markets have fallen, meaning that the next set of annual figures are unlikley to be so rosy.
The Church raised its stake in both types of investment in 2007, although last year its investments in shares lagged behind the performance of the stockmarket as a whole by about 3%.
In order to offset its risky investments abroad, the Church has also set up a currency hedging programme to short-sell the British pound. But its extensive property portfolio, which includes investments ranging from new shopping centres and retail warehouses to apartments in Manhattan looks likely to take a battering.
Despite an Ethical Advisory Group which helps the Church make its investment decisions, the Church's largest shareholdings have been in oil companies, and included at the end of last year £180 million in Shell, and £144 million in BP. Both benefitted from the speculation which drove up oil prices to around $160 dollars a barrel, but have declined since the beginning of the year by close to 20% - potentially losing the Church £65 million....MORE
The Church seems to have lost both its way and its money.