U.Va. endowment parallels recovery
NACUBO, Commonfund partner to deliver report; University ranked 19th among 839 institutions
The University has the 19th largest endowment of the 838 colleges in the United States and Canada included in a survey released Monday by the National Association of College and Business Officers (NACUBO) and Commonfund..
The University's endowment, managed by the University's Management Company, increased by 28.4 percent to $4.76 billion from its 2010 value of $3.7 billion.
This growth reflects the net impact of withdrawals to fund institutional operations and capital expenses, the payment of endowment management and investment fees, additions from donor gifts and other contributions, and investment gains or losses.
"Before the economic downturn, we used to say that the endowment was the icing on the cake at the University," University spokesperson Carol Wood said. "It gave us the additional things that we wanted to do that we didn't have the money for."
The funds are invested to generate income for salary enhancements for faculty, financial aid and support for academic athletic programs, Wood added.
The institutions included in the NACUBO study had an average return rate of 19.2 percent this past year, compared to the 2010 rate of 11.9 percent.
Ken Redd, director of research and policy analysis at NACUBO, however, warned against being too quick to celebrate the news, as most colleges and universities have not fully recovered from losses incurred in the 2008 financial crisis.
"I think it's important to note that while endowment returns are up, we still have about half of the schools that participated in our survey that have not fully recovered from the endowment losses that occurred in the financial crisis in 2008," Redd said.
Redd said it would be a few years before endowment funds at colleges and universities return to pre-2008 levels.
"We'll still need to see another year or two of healthy, strong endowment returns before schools can say they have recovered," Redd said.
Wood said the University depends more heavily on the endowment for daily purposes now than it did previously, which makes securing a healthy endowment important.
"[The endowment] is a perpetual source of strength for the University," she said.
NACUBO has published the list showing institutions' endowment performance annually since fiscal year 2002.