University of Oregon 2019 Annual Financial Report
Notes to the Financial Statements
For the Year Ended June 30, 2019 (dollars in thousands)
Investments of the UO Foundation are summarized at
June 30, 2019 as follows:
Fair Value at June 30,
Corporate Stocks, Bonds, Securities and
Mutual Funds
Investment in Common Stock, Voting
Trust and Partnerships
Money Market Funds and Certificates of Deposit
Other
Total Investments
Credit Risk
2019
2018
$ 273,273 $
261,322
934,196
41,078
2,290
$ 1,250,837
$
881,823
65,450
2,252
1,210,847
Credit risk is the risk that the issuer of a debt security
fails to fulfill its obligations. The UO has separate
credit criteria for each segment of the cash and
investment pool. See the table below for the UO's
investment credit quality ratings at June 30, 2019.
2019
US Government Notes & Bonds
US Government Agency Issues
Corporate Notes
Foreign Issues
Municipal Issues
Credit Rating (S&P)
Fair Value
AAA
AA
A
BBB
Unrated
$ 12,820 $
12.154
331
23,224
$ 12,820 $
11,823
2,241
S
$
12,587
8,397
12,196
8,669.
3,527
15,603
3,987
2,479
150
6,964
150
2,173
Fair Value at June 30, 2019:
$ 76,147 $ 12,988. $ 29,363
Asset-Backed Securities.
Custodial Credit Risk
$ 19,701 $ 10,569 $ 3,527
Custodial credit risk refers to the UO's investments that
are held by others and not registered in the UO's or the
state treasury's name. Currently, all investments are
held by the UO and in the UO's name.
Custodial credit risk typically occurs in repurchase
agreements or securities lending transactions where
one transfers cash to a broker-dealer in exchange for
securities, but a separate trustee in the name of the
broker-dealer holds the securities. The UO does not
directly participate in securities lending transactions.
However, any funds on deposit with the state treasury
may be included in their securities lending program. The
state treasury and the Oregon Investment Council have
established policy provisions around securities lending
to control this risk. See Section C. Securities Lending in
this note for additional information. The UO's investment
policy and procedures permit repurchase agreements but
none existed as of June 30, 2019.
Concentration of Credit Risk
Concentration of credit risk refers to potential losses
if total investments are concentrated with one or few
issuers.
For the year ended June 30, 2019 the UO held
investments, excluding the U.S. Government and its
agencies, that were greater than or equal to 5 percent of
total investments with the following issuers:
Issuer
T3 Investment Pool
Amount
$ 75,504
%
48
The T3 investment pool is a limited liability company
(LLC) which is managed 100% for the benefit of the
UO. Concentration risk within the pool is managed
such that on a cost basis, no more than 20% of the pool
may be allocated to a single manager.
Foreign Currency Risk
Foreign currency risk is the risk that investments may
lose value due to fluctuations in foreign exchange
rates. At June 30, 2019, the UO had no securities
denominated in any foreign currency.
Interest Rate Risk
Investments in fixed income securities are subject to
the risk that changes in interest rates will adversely
affect the fair value of the investments. The UO's
policies and procedures permit Tier 1 cash and
investments a maximum duration of nine months and
a maximum maturity of three years. Tier 2 of the cash
and investment pool permits a maximum duration
of three years and a maximum maturity of five years.
Tier 3 of the cash and investment pool is invested as a
quasi-endowment, and consequently has no duration
or maturity limits.
As of June 30, 2019, the UO held $76,616 in fixed
income securities, including accrued income of $469.
US Government Notes & Bonds
US Government Agency Issues
Corporate Notes
Asset-Backed Securities
Foreign Issues
Municipal Issues
Fair
Value
Average
Duration
$ 12,820
3.13
12,154
2.27
23,224
2.80
12,196
1.40
15,603
2.23
150
1.46
Fixed Income Investments $ 76,147
Fixed Income Weighted Average Duration:
2.43
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