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Wall Street philanthropy picks up, but not for all

At a charity live auction in December for babies born into poverty, Stephanie Astic noted a heavy Wall Street presence in the room -- the extent of which she had not seen since 2007.
/ Source: Reuters

At a charity live auction in December for babies born into poverty, Stephanie Astic noted a heavy Wall Street presence in the room -- the extent of which she had not seen since 2007.

"They were bidding things up," said Astic, who produces fundraising events for "Room To Grow" and other non-profits at posh Manhattan venues such as Christie's and Gotham Hall.

"I thought, they're finally feeling more confident, bonus time is coming," she said.

After the global financial crisis of 2008 rocked Wall Street, prompted massive layoffs and diminished bonuses, non-profits in New York struggled in 2008 and 2009 and through the first half of 2010.

That lower level of giving was not surprising since Wall Street accounts for about 35 percent of pay in the city. Now with banks back in profit and their denizens flush with big bonuses once more, some charities are seeing a difference.

Astic said in the past three months, business has picked up considerably, but it is still about a third less than in 2007.

The phones, at least, are ringing, she said, noting she is getting two to three calls from potential new clients a week.

"Those 18 months seemed like a drought," she said, with only a handful of calls from prospective non-profit clients seeking to hold fundraising events. "Now there's more energy."

Galas and auctions are key fundraising events for charities. Most pick wealthy honorees for galas, who are then expected to raise a certain sum of money, be it $100,000 or $200,000, from their network, Astic said.

During the crisis, many Wall Street executives declined to be honorees, concerned their jobs were not secure or that they would have trouble raising the money, she said.


United Way of New York City, which focuses on helping people in need, said it expects a 30 percent increase in giving from the financial industry for the 2010-2011 fiscal year.

"The financial services industry is sending signs they are feeling better about their ability to give back," said United Way of New York chief executive Gordon Campbell. "But we are not out of the woods yet."

Terry Sears of Tuesday's Children, a non-profit that supports children of 9/11 victims, said 2008 was "excruciating" and 2009 "challenging," but donations are picking up again.

"It's hard to figure out if the increased interest is because of the economy or that the 10-year anniversary of 9/11 is coming up," she said.

But not all non-profits are seeing a pick-up in Wall Street generosity. The New York Botanical Garden said it has not seen any significant change in contributions from Wall Street yet.

According to Blackbaud, which produces a monthly index of giving, giving overall rose by 0.3 percent in the three months ending November 2010, compared to a year-earlier.

"Philanthropy tends to lag recessions by six months to two years. I expect there to be a slow recovery, I don't see giving taking off," said Chuck Longfield of Blackbaud.

Phil Orlando of Federated Investors said he cut back on giving to charities other than those on whose boards he sits during the past two years.

"If my bonus turns out to be nice and the markets continue to recover, I will certainly be more generous," he said.

Chris Page, who advises individuals and companies on philanthropy, said he has seen a cautious increase in giving among his Wall Street clients, especially to help the needy.

"The strongest interest may be in areas that need the most help in the economic recovery, such as social services," said Page, who works at Rockefeller Philanthropy Advisors.

"It may be that arts and culture organizations are seeing less interest from those type of donors," he said.

Astic said she has noticed the Wall Street set is scaling back on the number of non-profit boards they sit on.

Another difference compared to before the crisis; a tight budget for events, as donors want to see their money spent on the cause rather than the decor.

"It's still seen as somewhat in bad taste to spend too much," Astic said.