In the upcoming issue of my e-newsletter, The Planned Giving Key, scheduled for publication this Tuesday, August 4th, I make reference to a former client and one of my favorite nonprofits. This organization, which never (to my knowledge) raised more than mid-seven figures prior to the recession, is in the process of receiving an extremely large bequest. 

Distribution to them begins shortly and will probably save quite a few jobs and salaries, not to mention valuable programs. I'm guessing some of the windfall will also go towards their endowment because it was hurt like everyone else's, and I have to think that my constant harping on planned gifts going to endowment was heard. 

Occasionally, nonprofits receive bequests and they're surprised because they can't identify the deceased.  This nonprofit has been actively soliciting bequests and other planned gifts for many years and I can say with certainty the surprise in this case was definitely the amount.  It 's possibly the biggest such gift they've ever received, and I'm so happy for them.  Good times or bad, this is a wonderful gift.

Do you think any of the banks that are choosing to close so called "smaller" planned giving accounts gave any thought to the possibility of my former client's situation occurring for their soon to be "orphaned" nonprofits? It's hard to understand the reasoning in throwing out a client that already exists. Even if they're small, surely they're expected to grow and those assets would presumably remain with the bank.  If these banks want to only open larger accounts in the future, OK-that's certainly one method of upgrading assets under management.  But why get rid of business already on the books? I'm guessing it's not that the assets are too small, only the fees generated. 

Let's face it - banks think BIG - not necessarily smart but definitely BIG. This morning, the headline of a lead article in today's NY Times Business Section read something like: Bankers Reaped Lavish Bonuses During Bailouts "Thousands of top traders and bankers on Wall Street were awarded huge bonuses and pay packages last year, even as their employers were battered by the financial crisis".

I have more than 17 years of over-the-counter trading for various Wall Street firms and banks under my belt - I firmly believe in earned bonuses. It seems to me that banking's commitment to serve nonprofit clients should be at least as strong as its determination to pay outrageous "unearned" bonuses to those who have really hurt them. We know the reason for not wanting a nonprofit's small account, but what's the reason behind wanting to pay a lavish, unwarranted bonus?  

I'm somewhat reassured and gratified that there are several other banks that handle planned giving investment and administration that are scurrying to find these rejected nonprofits. I hope every nonprofit planned giving account thrown out by a bank due to its size receives a staggering bequest or planned gift after it finds a new home. I'll be happy to work on it for them!

What do you think?


P.S. You can subscribe to The Planned Giving Key^TM on my website www.breakthroughphilanthropy.com