BNP Paribas, as Administrative Agent and lead bank, recently closed a credit facility for the State of Connecticut’s first Pay-for-Success Project (the “Connecticut Family Stability Pay for Success Project”), launched by the Connecticut Department of Children and Families. BNP Paribas is supporting this project in partnership with Social Finance Inc., Family-Based Recovery at the Yale Child Study Center, University of Connecticut Health Center, the Harvard Kennedy School Government Performance Lab, White & Case, Jones Day, and other participating lenders.
Pay-for-Success contracts, also known as “Social Impact Bonds,” are innovative public-private partnerships that combine nonprofit expertise, private sector funding, and independent evaluation to transform the way governments respond to chronic social problems. Through this model, private capital is raised to cover upfront costs for high impact programs while repayment to private investors only occurs if the program meets predetermined performance outcomes. Independent evaluators measure the effects of the program based on specific metrics that benefit both individuals and society.
The Connecticut Family Stability Pay for Success Project provides $11.2 million of private capital to support new intervention teams delivering “Family-Based Recovery” treatment to families with children aged six years or younger. Each team will visit a client’s home several times per week to promote positive parent-child interactions, increase parental understanding of child development, and assist parents on their path to substance use recovery. The project is designed to help ensure family stability and keep children with their parents.
Jean-Yves Fillion, CEO of BNP Paribas USA and Head of the Americas, Corporate & Institutional Banking said, “Our aim is to drive social change by creating well-structured and targeted investments as solutions to pressing social, economic and environmental issues. This innovative pay-for-success model demonstrates our ability to impact local communities and underscores our mission as a sustainable and responsible financial institution.”
In addition to BNP Paribas, participating lenders include QBE Insurance Group Limited, The Reinvestment Fund, Doris Duke Charitable Foundation, Laura and John Arnold Foundation, Nonprofit Finance Fund, and two anonymous family foundations.
BNP Paribas is committed to financing sectors that have significant positive impacts on local job creation and the strengthening of society. As of June 30, 2016, BNP Paribas had €840 million of commitments in support of social entrepreneurship and microfinance, serving approximately 900 clients and partners. In 2015, BNP Paribas also provided 470,900 people with access to financial education programs.
About BNP Paribas Group
BNP Paribas is a leading bank in Europe with an international reach. It has a presence in 75 countries, with more than 189,000 employees, including more than 146,000 in Europe. The Group has key positions in its three main activities: Domestic Markets and International Financial Services (whose retail-banking networks and financial services are covered by Retail Banking & Services) and Corporate & Institutional Banking, which serves two client franchises: corporate clients and institutional investors. The Group helps all its clients (individuals, community associations, entrepreneurs, SMEs, corporate and institutional clients) to realize their projects through solutions spanning financing, investment, savings and protection insurance. In Europe, the Group has four domestic markets (Belgium, France, Italy and Luxembourg) and BNP Paribas Personal Finance is the leader in consumer lending. BNP Paribas is rolling out its integrated retail-banking model in Mediterranean countries, in Turkey, in Eastern Europe and a large network in the western part of the United States. In its Corporate & Institutional Banking and International Financial Services activities, BNP Paribas also enjoys top positions in Europe, a strong presence in the Americas as well as a solid and fast-growing business in Asia-Pacific. www.group.bnpparibas
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