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November 04, 2009 |
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BofA Overhauls Philanthropic Products |
(Dow Jones)--To gain market share and compete with top players in the
donor-advised fund space, Bank of America Merrill Lynch is overhauling
its donor-advised funds and other philanthropic product offerings.
The company announced a host of new capabilities to an
expanded group of philanthropic investors and their financial advisers
Wednesday, including reducing the minimum amount to open a
donor-advised fund to $5,000 and creating an online portal to view
investment options, track balances and work with financial advisers on
a giving strategy.
Offering these services to clients of Merrill Lynch advisers
and U.S. Trust, as well as lowering the price point of entry, "gives us
scale and make these products accessible to a broader population," said
Cary Grace, national philanthropic management executive for Bank of
America Merrill Lynch.
Currently, Bank of America Merrill Lynch Philanthropic
Management distributes more than $300 million in grants to charitable
organizations annually on behalf of its clients, and serves as trustee,
co-trustee or grant-making agent for more than 30,000 philanthropic
accounts.
The company would not disclose the donor-advised funds'
assets under management, but experts say they do not yet compare to
those at bigger outfits such as Fidelity Investments' Fidelity
Charitable Gift Fund and Schwab Charitable, a unit of Charles Schwab
Corp. (SCHW), with $3.6 billion and $1.7 billion under management as of
August, respectively.
With resources coming from its acquisition of U.S. Trust in
2007 and Merrill Lynch in 2008, the Bank of America Charitable Gift
Fund is able to accept a wide range of specialty assets, such as
residential and commercial real estate, farmland, timberland, oil and
gas properties, collectibles, and private businesses at the time of
liquidation, and convert them into cash donations.
"Particularly in this economic environment, wealthy donors
are looking for innovative ways to give beyond cash and stock, and many
specialty assets were less affected by the downturn," said Gillian
Howell, national private philanthropy executive for Bank of America
Merrill Lynch.
The Merrill Lynch Community Charity Fund will also be
available to donors looking to create a donor-advised fund in concert
with a community foundation and a Merrill Lynch financial adviser.
"This fund is particularly suitable for donors who are
looking to be philanthropic locally but haven't identified the
charities they want to support," Howell said.
Separately, Bank of America's Foundation Services are now
available to Merrill Lynch clients who are looking for broader services
ranging from back office and management to a family foundation to
simply drafting a mission statement for family giving. Currently,
philanthropic management provides investment and philanthropic services
to more than 10,000 individuals, foundations, endowments and other
nonprofit organizations with more than $55 billion in assets.
Grace said the company conducted internal training for
financial advisers around the new products, as well as philanthropic
research.
"We wanted to make sure our advisers are up to speed with
the most efficient and effective strategies, particularly as donors
head into the fourth quarter when most of the giving occurs," she said.
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