Moneyval, a European anti-money-laundering watchdog, commended on Thursday, December 12, the Vatican's efforts to improve its cleaning up process of the Holy See's opaque financial dealings, according to a report by the Wall Street Journal.

The cleanup boosted Pope Francis' efforts to overhaul the Vatican's finances after the Holy See has been criticized for financial scandals.

"We are very satisfied with the progress made," John Ringguth, executive secretary of Moneyval, said in an interview. The Vatican 'addressed almost all the areas that were required.'"

However, a 120-page Moneyval report backed by financial experts of the Council of Europe, criticized the world's smallest state for its bank's loose regulatory oversight specifically pointing the shortcomings of the Vatican's Financial Intelligence Authority (IFA). According to Moneyval, the IFA failed to inspect the Vatican bank that manages a massive portfolio that range from real estate to financial assets. Moneyval's report said the inspections are expected to end January 2014.

Since his election to the Papacy, Pope Francis made the cleanup of the bank one of his priorities. He has set up a special committee who will review the Vatican bank and established a group of eight cardinals who will serve as advisers on how to reform the Curia, the Vatican's administrative body. The council will discuss the Vatican's financial institutions in February 2014.

February, the council will discuss the Holy See's financial institutions.

"The report is very positive," Rev. Federico Lombardi, Vatican spokesman, said in an interview. "It explicitly recognizes the measures introduced and it is a stimulus to continue in the path undertaken."

Pope Francis has made the cleaning up of the Vatican's financial dealings one of his priorities. He has set up a special committee to review the Vatican bank.

The 126-year-old Vatican bank has been trying to overcome decades of scandals, most notably the 1982 collapse of Banco Ambrosiano, in which it was a main shareholder. In 2010, Italian prosecutors placed two top Vatican banks officials under investigation over possible failure to comply with rules against money laundering. The investigation is ongoing. The Vatican denies wrongdoing.