Herr Tietmeyer, who headed the Bundesbank from 1993 to 1999, studied theology before switching to economics and is a member of the Pontifical Academy of Social Sciences. He has two brothers who are priests.

Herr Tietmeyer, 75, would succeed Angelo Caloia, an Italian banker brought in 15 years ago by Pope John Paul II to “clean up” the Vatican Bank, or Institute for Religious Works, after scandals linking it to Mafia financiers such as Michele Sindona, who died of a mysterious poisoning in prison in 1986.

An earlier attempt to replace Signor Caloia with Herr Tietmeyer in 2000 was thwarted by the Italian’s allies, including Stanislaw Dziwisz, John Paul II’s private secretary. Pope Benedict, however, is said to favour a fellow German at the helm of the Vatican’s finances. “The war for the succession to God’s Banker is on,” Panorama magazine said.

Vatican finances are also being reshuffled. It emerged last week that the Congregation of the Children of the Immaculate Conception, based in Rome and subject to papal law, has bought a Pfizer drug unit. Nerviano Medical Systems (NMS), one of Europe’s largest oncological research centres, is dedicated to developing antitumour drugs. Bankers believe that the Congregation may seek a stock market listing for NMS in the future.

The change at the Vatican Bank would be part of a wider reshuffle of the Pope’s team. On Wednesday Cardinal Angelo Sodano, the Secretary of State (Prime Minister), is replaced by Cardinal Tarcisio Bertone, the Archbishop of Genoa and the former Cardinal Joseph Ratzinger’s deputy at the Congregation for the Doctrine of the Faith.

The Pope has also drawn up a short list of potential successors to Archbishop Giovanni Lajolo — who in June was named the new governor of Vatican City — as Vatican Foreign Minister and Cardinal Camillo Ruini as Vicar of Rome and head of the Italian Bishops.

Pope Benedict’s priority on returning from his trip to his German homeland this week is to reshape his top team, a year and a half after his election.

Vatican finances have moved healthily into the black, with the Holy See marketing images from its rich art collection and recording a profit from property and commercial investments.

The Pope plans to merge two other key Vatican financial institutions, the Administration of the Patrimony of the Apostolic See (APSA) and the Prefecture of Economic Affairs. The changes are reportedly resisted by Cardinal Attilio Nicora, head of APSA and a longstanding ally of Signor Caloia.

Times Recommends

• Minister in talks with Saudis to protect creditors
• Premier Inn hits back in £29-a-room row
• Bankers hit back at 'populist' bonus supertax