Endowment down 16.1%

Columbia officials released a statement on Friday—shortly after Harvard’s and Yale’s announcements of endowment losses—indicating that the University’s endowment losses for the year ending June 30 was 16.1 percent, leaving a preliminary unaudited endowment value estimate at slightly more than $5.7 billion.

As reported in May, Columbia’s endowment was down 22 percent for the first nine months of the fiscal year ending March 31, but the announcement of the 16.1 percent figure indicates that Columbia’s losses have slowed recently, which Senior Executive Vice President Robert Kasdin attributed to “stronger market conditions” in an interview.

“The investment performance of our endowment’s managed asset portfolio for the year ending June 30 2009 was negative 16.1%, which reflects the normal quarter lag in private equity and real assets,” the statement read. “Although comparative data with the full set of our peers for FY09 is not yet available, over the previous five years Columbia’s investment performance ranked within the top quartile of large university endowments and private foundations.”

According to Kasdin, the 16 percent figure considers investments, not donations and gifts. The decline refers to finances over the period beginning July 1, 2008 and ending June 30, 2009. The 22 percent decline reflected finances until the end of March, and the recent announcement shows that that loss had decreased overall by 6 percentage points by the end of June 2009. Kasdin noted that endowment strategies are long-term, and did not change over the period.

“The investment team produced very successful returns when the market was strong, and relative success when it was weak,” Kasdin said.

A fuller set numbers will be reported in the University’s audited financial statements in October, but the preliminary unaudited endowment value estimate is currently at slightly more than $5.7 billion, after standard endowment spending of about 4 to 5 percent annually, said Kasdin. The fund was valued at $7.1 billion as of June 30, 2008.

While these recent reports indicate that the University’s losses are slowing, previous plans to constrain its spending habits—Bollinger announced in January that each “budget unit” of the University should plan for an 8 percent decrase in the amount of funds that they would receive in the next fiscal year from endowment funds—will continue as planned.

“The country, including the university, is going through a period of scarcer resources that were available earlier in the decade,” said Kasdin. “Each school has responded in accordance with its own budgetary circumstances.”

“It’s really a call on departments and schools to think about how they can do their jobs, protect their core missions, with less resources than they’ve had in the past,” Stephen Rittenberg, senior vice provost, said in a May interview.

“President Bollinger identified the strategy we were doing last year and we’re going through with it,” said Kasdin. “Each school and budget center is expected to balance its budget and that’s the challenge that remains in front of Columbia and the rest of the country.”

Harvard announced that its endowment lost 27.3 percent of its value, down to $26 billion by June 30 from $37 billion one year before that, Bloomberg News reported. Yale’s endowment has declined by 30 percent, leaving the endowment at approximately $16 billion, more than double the value of Columbia’s.

Joy Resmovits contributed reporting to this article.