Magazine article American Banker

Merrill Eyes Donor-Advised Fund for Charitable Giving

Magazine article American Banker

Merrill Eyes Donor-Advised Fund for Charitable Giving

Article excerpt

Merrill Lynch & Co. says it will start a donor-advised fund in April that will link the New York brokerage firm with a national network of community foundations to boost its charitable-giving assets.

The Merrill Lynch Community Charitable Fund is intended to let private clients making a minimum investment of $25,000 work with individual money managers and specific community foundations. Merrill has signed agreements with 13 community foundations and says it has 60 foundations prepared to sign up.

H. King McGlaughon Jr., the director of Merrill's Center for Philanthropy and Nonprofit, told a press briefing Tuesday that he believes Merrill will accumulate $1 billion to $1.5 billion of assets in the donor-advised funds within two years. In that time, he said, 100 community foundations will each open 250 to 300 donor-advised accounts.

Mr. McGlaughon said Merrill's program is the first to offer a uniform donor-advised program through community foundations nationally.

"Typically, each community foundation sold individual donor-advised funds, and that left people comparing apples to oranges to pears to peaches when it came to giving," Mr. McGlaughon said. "If investment firms want to engage investors in real philanthropy, then each program has to look and behave the same way."

Mr. McGlaughon said customers would have access to Merrill's money managers and a group of 11 non-Merrill portfolio managers.

Bank investment executives say the popularity of donor-advised funds is rising. The Chronicle of Philanthropy has reported that the number of people who established donor-advised funds rose by 25.9% in 2001 and assets grew 20%, to $12.3 billion.

Larry Jones, a vice president in Wilmington Trust's philanthropic services group, said more investment managers are offering the products.

Twelve donor-advised funds have been started this year, Mr. …

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