No Mercy: Nuns Feel Spanish Bank's Cuts

Feb. 6, 2014 5:04 p.m. ET

Convent of San Juan of Penitencia in Alcalá de Henares, near Madrid. Sarah Tennant

ALCALÁ DE HENARES, Spain—Spain’s financial distress has trickled down to a secluded back office of one of its largest banks—the convent where Sister Mariuca Mesones sorts and labels the lender’s outgoing mail.
After Mass most mornings, she and 10 other cloistered members of the Order of St. Clare file into an L-shaped office of the Roman Catholic retreat and become bank employees. They enter data into the bank’s computer network on flat-screen terminals, store documents or process refunds on unused airline tickets bought with the bank’s credit cards.
Their clerical jobs are part of an unusual, little-known pairing of Spanish institutions. Banco Popular Español SA, POP.MC -0.85% Banco Popular Espanol S.A. Spain: Madrid €5.26 -0.04 -0.85% Feb. 7, 2014 3:13 pm Volume : 12.11M P/E Ratio N/A Market Cap €10.31 Billion Dividend Yield N/A Rev. per Employee €380,087 02/06/14 No Mercy: Nuns Feel Spanish Ba… 01/31/14 Spanish Banks Still Battling B… 01/31/14 Europe’s Stocks to Watch: BBVA… More quote details and news » POP.MC in Your Value Your Change Short position the country’s fifth-largest bank by assets, has long relied on the Convent of San Juan of Penitencia, home of the St. Clare order’s nuns, and about 20 other Spanish nunneries to handle routine administrative tasks.
Both partners in that relationship are hurting these days. Six years after Spain’s real-estate bust shredded their loan portfolios, Banco Popular and some other lenders are still shuttering offices and shedding employees. That means less pay-by-the-hour work for the nuns, according to Banco Popular and nuns at some of the convents. “We need to work to survive,” said Sister Mariuca, whose wages help pay for the convent’s meals and upkeep of the 400-year-old building. “We can’t live from nothing.”
Southern Europe’s banking woes are rippling into other communities across the region, hurting more than borrowers. Italy’s Banca Monte dei Paschi di Siena SpA cut sponsorships for sports teams. National Bank of Greece since 2009 has more than halved its budget for social programs such as archaeological exhibits. In Spain, Bankia SA shuttered many public libraries it had funded.
Nuns and monks at Spain’s 874 cloistered retreats have limited contact with the world beyond their walls. They get little financing from the church hierarchy. Spaniards, hit by falling wages and high unemployment, are buying less of the artisan pastries, liquors and other products that nuns and monks traditionally sell from their entryways to support themselves. In recent decades, the ranks of the cloistered have thinned and aged, making self-sufficiency all the more challenging.

No public data on the finances of Spain’s enclosed orders exist, but many convents “can’t subsist anymore,” said Mónica Artacho, director of DeClausura, a nonprofit organization that helps sell their products.
Banco Popular began hiring nuns in the late 1970s. The bank does more business with the Catholic Church than any other Spanish lender, said bankers who work with religious institutions. It is unclear how many Spanish banks work with convents. Spokesmen for the other big banks said their companies don’t.
The workload also has declined for the nuns at the Monasterio de San Benito who stuff envelopes for Ibercaja for about €1,200 a month, said a spokeswoman for the small bank in northern Spain and a nun at the convent. The bank increasingly is sending fewer envelopes because it contacts clients by email.
A spokesman for Popular said the bank pays nuns for back-office work because they do it to perfection and their convents need the money. “We have a very satisfactory relationship with them,” he said.
As in other convents, Popular helped equip an office at San Juan of Penitencia, in this city about 20 miles northeast of Madrid. Except for the framed portraits of St. Clare and St. Pancras on the walls, it resembles any white-collar workplace—with computer monitors, wide desks, photocopiers and fax machines.
“They call us the techie nuns because we work a lot with computers,” Sister Mariuca said.
Neither the bank nor the nuns would say how much the nuns earn. The bank spokesman said they are paid a “market price.” Bank employees who perform similar tasks and are covered by collective-bargaining agreements are paid at a rate of just over €7 an hour.
The use of convent labor fits with Popular management’s traditionally conservative ethos. While larger rivals invested heavily in Latin America in the past two decades, Popular focused on boosting profitability at home. Consulting firm Arthur D. Little named Popular the most cost-efficient bank in Europe in the mid-2000s.
But then Popular’s bets on real estate backfired when the property market collapsed in 2008. For 2012, Popular reported a record annual loss and was forced to raise billions of euros in new capital.
Nuns working with Popular say their workload has dwindled since then.
Instead of working four hours a day, the nuns at San Juan of Penitencia now finish their tasks in less than two hours.
Sister Mariuca, who has worked for the bank since joining the convent in 1998, worries about her aging sisters’ health.
“You know what they say, ‘Sloth is the enemy of the soul,’” she said.
The convent’s money concerns have mounted. The roof leaks. Mold grows on the ground-floor walls.
The building consumes three-fourths of the money 11 of the convent’s 13 nuns earn from bank wages, retirement pensions of those who are 65 years or older and the convent’s dwindling donations, she said.
Thrift is imperative. They lower the heat at night and save on food costs by cooking lentils and other legumes in big batches. Before Spain’s current hard times, the sisters sometimes treated themselves to store-bought pastries for breakfast.
“Now, that’s unthinkable,” Sister Mariuca said. “We’ve got it into our heads that we need to save money.”
Write to Ilan Brat at ilan.brat@wsj.com and Christopher Bjork at christopher.bjork@wsj.com

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