The University's endowment lost $740 million in the 12 months ending with June 30, falling to just over $2 billion, President Ruth Simmons said at a faculty meeting on Wednesday. But the discouraging endowment picture was tempered by relatively robust fundraising, Simmons said.
In fiscal year 2009, the endowment lost 26.6 percent of its market value. During that period, the endowment paid out $132 million and the University received $44 million in endowment gifts, Simmons said. On June 30, the endowment was worth $2.038 billion.
The endowment's real asset investments, such as real estate and commodities, fared the worst, falling almost 40 percent in the year, Simmons said. In contrast, the endowment's fixed income investments increased 7 percent.
"I'm happy to say that things are going very well," Simmons told the faculty, adding that worst-case economic scenarios had been avoided, both worldwide and for the University.
"We did not have to cancel (faculty) searches or do some of the more draconian things being done" at peer institutions, Simmons said.
The endowment's value at the end of June roughly matches the administration's "working assumption," announced in January, that the once-$2.8 billion endowment would be worth roughly $2 billion when the turbulent fiscal year was over.
Administrators will meet with members of the Corporation's committee on the financial crisis on Friday "to get their advice about the next steps," Simmons told the faculty. "We'll keep you informed and involved as much as we can."
Fundraising strong in down year
The "odd thing" is, Simmons said, that "in spite of a horrendous year otherwise" for the University's finances, the school raised $193.4 million — an all-time record for total cash giving.
The Campaign for Academic Enrichment also reached a landmark in 2009, exceeding its $1.4 billion goal more than a year ahead of schedule. The drive had raised $1.421 billion as of August 28, according to the campaign Web site.
Though new gifts and pledges to the campaign dropped 25 percent from last year, Brown still fared better than its peers. New gifts and pledges fell an average of 33 percent among peer schools, Marisa Quinn, vice president for public affairs and University relations, wrote in an e-mail.
The Brown Annual Fund finished the fiscal year with nearly $35 million, 0.4 percent below last year's total. The Parents Annual Fund's total was 48 percent greater than its total last year.
"One wonders where we would be if not for the campaign," Simmons said.
Wednesday's faculty meeting was the first for Professor of Physics Chung-I Tan as the new chair of the Faculty Executive Committee.