2008 Woodie Awards
Trustees voice concern over university investments
J. Breen Mitchell, News Editor
Issue date: 6/19/08 Section: News
Trustee John Pogue, an attorney, said the university is invested this way because of the need to raise funds.
"We need the money," Pogue said.
Shebak ended his presentation by recommending no changes to the university's investment portfolio.
"These investments are very prudent for a state university to own," he said.
Trustee and former Ohio state senator Harry Meshel said that this type of portfolio is similar to that of a state government with a surplus of funds, and is probably standard for state universities as well.
"I think it's traditional with most state universities," Meshel said.
Schulick said that his main concern was that 37.2 percent of the portfolio, or $16 million out of $40 million, is backed by mortgage- and asset-backed securities. He said that this may be too risky.
"Last time I checked, $40 million is still a lot of money," Schulick said.
Meshel agreed that maybe the money should move to more secure investments.
Garg agreed, saying that the portfolio is probably safe, but that because it is university money, it may need to be more secure.
"If it were my own investment, myself, I probably would go with what you say," Garg said to Shebak.
Pogue said that the goal of the portfolio was to increase yield because of a decrease in state funds and a reluctance to raise tuition.
He said that the discussion was about losing some cash in favor of higher quality investments.
"We've hired Allegiant to do a job," Shebak said, adding that the committee should look over their shoulder and second-guess them.
"They're still gonna blame us for you," Schulick said to Shebak of the possibility of a financial crisis.
Shebak advised meeting with other custodians and digesting what they have to offer, but not to make any decisions yet.
"It is prudent to consider additional managers alongside Allegiant," Shebak said, offering JP Morgan as a potential suggestion.
The committee decided to meet again in July to reassess the state of the university investments.
"We need the money," Pogue said.
Shebak ended his presentation by recommending no changes to the university's investment portfolio.
"These investments are very prudent for a state university to own," he said.
Trustee and former Ohio state senator Harry Meshel said that this type of portfolio is similar to that of a state government with a surplus of funds, and is probably standard for state universities as well.
"I think it's traditional with most state universities," Meshel said.
Schulick said that his main concern was that 37.2 percent of the portfolio, or $16 million out of $40 million, is backed by mortgage- and asset-backed securities. He said that this may be too risky.
"Last time I checked, $40 million is still a lot of money," Schulick said.
Meshel agreed that maybe the money should move to more secure investments.
Garg agreed, saying that the portfolio is probably safe, but that because it is university money, it may need to be more secure.
"If it were my own investment, myself, I probably would go with what you say," Garg said to Shebak.
Pogue said that the goal of the portfolio was to increase yield because of a decrease in state funds and a reluctance to raise tuition.
He said that the discussion was about losing some cash in favor of higher quality investments.
"We've hired Allegiant to do a job," Shebak said, adding that the committee should look over their shoulder and second-guess them.
"They're still gonna blame us for you," Schulick said to Shebak of the possibility of a financial crisis.
Shebak advised meeting with other custodians and digesting what they have to offer, but not to make any decisions yet.
"It is prudent to consider additional managers alongside Allegiant," Shebak said, offering JP Morgan as a potential suggestion.
The committee decided to meet again in July to reassess the state of the university investments.
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