The University of Washington has formed an internal investment company to manage its $3 billion endowment.
The university’s board of regents approved the establishment of the University of Washington Investment Management Company (UWINCO) at a finance and asset management committee meeting Thursday.
With the creation of UWINCO, Washington joins the ranks of the University of Texas and the University of Virginia as a public institution with its endowment overseen by a separate investment company. Private universities including Harvard and Stanford also utilize management companies.
A meeting agenda stated moving to an internal investment management company would “ensure continuing strong investment performance” and provide “enhanced oversight, stability and access.”
The university also stated in a release that the new structure would help attract expertise and “best-in-class” investment ideas.
Keith Ferguson, who was hired as the endowment’s first CIO in 2004 as the university began to create a professional staff focused solely on investments, will continue to oversee his team of 19. As CIO of UWINCO, Ferguson will begin reporting directly to the university president.
The current investment management advisory committee, which includes Cascade Investment (Gates Foundation) CIO Michael Larson, will be replaced by an expanded advisory board as part of the reorganization.
The board will oversee administrative duties of the investment program, while focusing on advising the university’s regents on the endowment’s portfolios.
“These changes reflect the maturation of the university’s investment program over the past quarter century,” said regent board chair Bill Ayer. “We want the financial community to view us as an investment company with a robust structure that is well suited to our growing and increasingly sophisticated portfolio.”
The University of Washington’s consolidated endowment fund totaled $3.3 billion as of June 30, 2015, with five- and ten-year returns of 10% and 7.5%, respectively. Until now, the investment committee formed in 2001 by the board of regents has overseen investing.