University distributes largest portion of endowment to student financial aid
Observer Staff Report | Wednesday, October 16, 2019
Notre Dame’s spending distribution from its endowment amounted to $426 million for the 2019 fiscal year, with nearly one-third of the total going to student financial aid, according to an Oct. 15 press release from the University.
For the 2019-2020 academic year, Notre Dame will distribute more than $154 million in need-based aid for undergraduate students. This amount of grant aid has more than doubled since 2009, the release said.
According to the release, almost half of undergraduate Notre Dame students receive financial aid from the University endowment pool, with the median grant amount for first-year students with demonstrated financial need currently at $42,600. This grant aid does not require repayment.
While the pool began with a value of $13.1 billion, the endowment pool returned 7.2% for the 2019 fiscal year, so the year will close with a value of $13.8 billion.
Over the past 20 years, Notre Dame has ranked among the highest institutional investors, according to the release, earning an annualized endowment pool return of 10%. In addition to the high annualized return, a 60/40 index blend of stocks and bonds returned 5.5%, also over the past 20 years.
Notre Dame’s actively managed investment program, headed by Scott Malpass, created value-added compared to the 60/40 index blend of $8.3 billion for the 20 years. Over the same time, spending distributions in support of the University’s mission grew at an annualized rate of 9.5%, amounting to $4.6 billion, the press release said.
Malpass, vice president and chief investment officer, said in the release Notre Dame works carefully to distribute the money in the endowment in a manner that effectively utilizes University benefactor gifts.
“We are committed to outstanding stewardship of our donors’ generosity with prudent investment and spending policies,” Malpass said in the release. “The growth of the endowment provides ever-increasing resources for financial aid, and also for the great work being done by our students and faculty around the world.”
Correction: An earlier version of this report incorrectly stated Notre Dame’s endowment amounted to $429 million. That amount is the spending distribution from the endowment. The Observer regrets this error.