Goldman Sachs makes loan to NYC bike program
Goldman Sachs has committed to investing in New York City, in large part because it wants to maintain an image as a bank interested in the greater social good.
At the same time, since it's now a registered commercial bank, it is also CRA-bound to invest locally. The best example of a socially conscious local investment--certainly one that generated massive media coverage--was its move to issue $10 million in social impact bonds in the form of a loan to a city agency. The proceeds will be used to reduce recidivism by former prison inmates.
The bank has just launched another civic program, a $41 million loan to finance the start of a bike-sharing program. The loan will support a program that Citigroup is also involved with. Goldman Sachs has also pledged millions to get the Citibike program up and running. Goldman Sachs' loan will be used as seed money, according to the Financial Times.
The plans call for "10,000 rental bicycles at hundreds of docking stations in Manhattan, Brooklyn and Queens, which would make it one of the largest schemes of its type."
Superstorm Sandy has pushed back the start date to around May. The loan from Goldman Sachs will be repaid by operating revenue from the program, which will include sponsorship payments from Citi.
"Goldman's UIG, which aims to profit at the same time as doing good, has already poured money into projects ranging from single-family housing in hurricane-ravaged New Orleans to solar panel installations on the roofs of not-for-profit organisations in New Jersey," FT notes.
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Goldman Sachs a socially conscious investment idea