Alum to manage UW's $1.2 billion fund

Kayla Webley
2005-01-06
The Daily

Keith Ferguson became the first person to hold the position of chief investment Officer (CIO) at the UW Monday, making him responsible for the UW's endowment, valued at more than $1.2 billion.

As CIO, Ferguson will be responsible for taking the money donated into the endowment and investing it. Funds will finance programs that the donors, typically individuals and corporate foundations, want to fund.

"An endowment is given such that the organization's gift will last in perpetuity," said V'Ella Warren, vice president for financial management and treasurer of the Board of Regents. "A portion of the return from the investment of the original money goes to fund programs that are of interest to [the donors]."

When the UW endowment reached $1 billion dollars in 2004, administrators decided it was time to hire someone with the knowledge to manage such a large sum. The result was Ferguson.

"It's at about the billion dollar range when universities seek more specialized expertise in the staff," said Warren.

Ferguson, a Seattle native returning to the UW, where he completed two masters' degrees in 1991 -- one in international studies and one in business administration, he said.

"Seattle is my hometown and I am very excited to be back," said Ferguson. "It is very nice to work for my alma mater in a job where I can I try to add value to the greater good of the University."

For the past eight years, Ferguson has worked for Fidelity Investments and served in Hong Kong as the CIO for the Asia and Pacific region for more than three years.

"Of the candidates, we considered [Ferguson] to be the best for the position because he is very experienced in the investment market, has a proven track record and a sense of what the UW is trying to achieve," said Weldon Ihrig, UW executive vice president.

When money comes into an individual entity -- such as the UW Medical Center, which received the largest amount of donations in 2004 -- it is put into the overall UW endowment and distributed among stocks and bonds in both global and domestic markets. Every year 5 percent of the return comes back to the individual groups in the proportion in which it was invested.

The groups use the money to fund various internal programs, such as building projects and scholarship funds.

"The money is helping with things around what the students do," said Ferguson. "It helps with the overall running of the University."

Ferguson said high investment performance of the endowment funds is his top priority.

"The saying goes 'a university of a 1,000 years,'" said Ferguson. "Meaning this is a very long term investment where we can ride the ups and downs of the market. We can research and spend the time to get it right."

After spending a portion of his career abroad, Ferguson is quick to point out the importance of keeping the investment team focused on watching both international as well as national markets.

"The team is fantastic, nothing's broken," said Ferguson. "But I am going to try to make the whole team and process a bit more market aware, both domestically and globally."

A gross majority of the endowment -- 80 percent -- is invested in domestic markets, leaving 20 percent to be invested internationally. Ferguson said he plans to invest more overseas due to the current boom in investments there.

"We will look at opportunities outside of our normal pool," said Ferguson. "Everyone knows there is a lot more growth going on in Asia right now than in the U.S."