Bank of America Merrill Lynch raises $13.5m for New York social impact program

A new payment-for-results anti-recidivism social impact programme from Bank of America Merrill Lynch in partnership with New York State and impact investment group Social Finance Inc. has raised $13.5m (€10m) from institutional and private investors.
Proceeds will be used for a five-and-a-half-year programme to offer re-employment services to 2,000 former prisoners in New York City and Rochester.
The investment was available only to high net worth and institutional clients of Merrill Lynch and Bank of America’s wealth management subsidiary US Trust, as well as other investors identified by Social Finance.
It’s the latest project following on from the well-known Peterborough Prison Bond in the UK.
“One of the most pronounced trends among our clients is for their investments to not only earn a return but also to help drive social change,” said Andy Sieg, head ofGlobal Wealth and Retirement Solutions at Bank of America Merrill Lynch. He added the new deal was an “important step toward a scalable new marketplace” for social finance.
The proceeds of the project will finance programs delivered by the Center for Employment Opportunities, which provides training and employment services to people with recent criminal convictions.
Tracy Palandjian, chief executive and co-founder of Social Finance said the investment focused on prevention; the outcomes of the programme will be validated by Annapolis, Maryland-based Chesapeake Research Associates.
The Rockefeller Foundation provided a $1.32m guaranty facility to the project, which will cover 10% of investors’ principal. Link