December 9, 2004 | Read Time: 2 minutes
A growing number of private banks are now offering advice to the wealthy on how to give their money away, notes Worth magazine (December).
In the past six years, the magazine says, the banks have stepped up their efforts to compete with financial planners, lawyers, accountants, and professional philanthropy advisers.
One of those competitors, H. Peter Karoff, founder of the Philanthropic Initiative, a nonprofit group that provides advice to donors, says he is glad that banks are offering such services, but he is not impressed with the quality of what they deliver. “The problem is that philanthropic advisers are somewhat marginalized within their institutions,” Mr. Karoff tells the magazine. “Within a bank, philanthropy is not the main event. These so-called soft services are, well, soft.”
Private banks admit that they are not attempting to provide the same comprehensive services as full-time philanthropy advisers.
However, they are trying to bolster their offerings, the magazine says. For instance, the philanthropic advisory service of Citigroup Private Bank last year organized a trip to Mozambique and South Africa called “A Journey to Africa: Getting Engaged With Your Philanthropy” that attracted 16 of its clients.
Jay Steenhuysen, managing director of philanthropy services at Charitable Entity Administration, a for-profit company in Providence, R.I., says donors considering working with private banks should ask hard questions to determine the institution’s expertise.
Among the questions he suggests donors should ask: “Where did the advisers get their philanthropic education? Did they come out of a legal background, an accounting background, insurance, investment, or philanthropy?”
The philanthropic planning available in private banks is “a positive trend for all involved, even at its most basic level,” Mr. Steenhuysen tells the magazine, “as long as it does not stop there.”
