Page 16 of the January Banner has a notice about a mutual separation of a senior financial officer attached to a college owned by the CRCNA. This it appears after a 100 million (yes you read right 100,000,000) dollars worth of "payments" are required in 2017(??). Where are the overseers of this officer? Where are the auditors? Here I thought the CRCNA had a very thorough and conservative Investment Policy in place. I also remember commenting to a senior financial officer of the CRCNA how it was that CC could have $200MM in investments and still have $124MM in notes payable. My experience as a career Banker is that organizations like CRCNA will panic and make the losses much worse than need be. I trust the church or CC will engage outsiders to clean up this mess and not leave it to those who in ANY way were close to this fiasco.
Comments
The financial issues facing Calvin College have be the cause for many misstatements of fact that make the situation look like a "fiasco" compared to the actual issue.
Calvin College does have over $100 million in debt that was related to the significant construction program they undertook over the last few years. What comes due in 2017, however, is not the full $100 million plus, but simply a scheduled payment on the debt.
The Christian Reformed Church Investment Policy is fairly conservative, but has nothing to do with Calvin College's decision to follow common practice and fund construction with low-cost bonds.
To place a $100 million worth of Bonds would have taken some doing and lots of fees. How are these secured? How were interest rates set and were futures involved in hedging the rates? Depending on the timing this process could have resulted in steep losses. The fact that Calvin undertook a $100 million worth of building projects is quite suprising but I suspect it's over a number of years.I do not need answers to these questions but am a bit nervous about $100 million in debt.
If there have been "misstatement" of facts can we please have those corrected so we have the real story.
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