In 2022, the stock and bond markets will fluctuate, and the Hang Seng Index will repeatedly fall to a multi-year low.
Four universities in Hong Kong recently released their annual reports as of the end of June 2022. Affected by the unstable investment market, the investment and interest income of the four universities turned from profit to loss, with a total loss of 3.9 billion yuan.
Among them, Hong Kong University lost the most, with a total loss of 2.16 billion yuan; City University lost 1.21 billion yuan, which wiped out the profit of the previous year.
Some universities explain why in their annual reports.
Among them, CityU said that it was due to fluctuations in the investment market; EdU said that the loss was mainly from stocks, and pointed out that the stock market had a large adjustment last year, which was due to the market's worries about monetary tightening and interest rate hikes in the United States and Europe, which may cause economic recession and affect listings The company is profitable.
4University investment and interest turn from profit to loss
Across 2022, many universities in Hong Kong have released their 2022 annual reports in recent months, including HKU, CityU, PolyU and EdU.
Checking the financial status of the 4 universities’ annual reports, the 4 universities recorded a turn from profit to loss in terms of investment and interest, and 3 universities lost hundreds of millions of yuan. The total loss of the 4 universities in the entire year in terms of investment and interest was nearly 39 billion.
HKU to earn $3.3 billion in profit in 2021
According to the annual report, the University of Hong Kong lost more than 21.6 yuan in investment and interest, and recorded a profit of 3.3 billion yuan in 2021. However, the overall income still recorded 10.63 billion yuan from government subsidies, tuition fees and donations.
As for CityU’s interest and net investment return, it also recorded a loss of 1.21 billion, and its comprehensive income recorded a loss of 1.43 billion.
PolyU’s investment and interest recorded a deficit of RMB 480 million. Taking into account other income, there was still about RMB 6.6 billion in income for the year, and there was still a surplus of RMB 3.2 billion after deducting expenses; EdU also recorded a loss of RMB 40.832 million in investment and interest.
CityU: Abnormal fluctuations in the investment market EdU: Major adjustments in the stock market
Some universities have explained the situation in their annual reports. Among them, City University pointed out that due to the abnormal fluctuations in the investment market, it recorded a negative investment return of 1.21 billion yuan in this fiscal year. Since the investment return in the previous fiscal year increased by 1.24 billion yuan, it means that in the past two years Return on investment is close to zero growth.
The Education University stated that the interest and net investment income items recorded a loss of about 41 million yuan in the year. The loss mainly came from the stocks in the investment portfolio. The substantial adjustment of the stock market in the past year was due to market concerns about the United States and Europe. Monetary tightening and interest rate hike policies may cause economic recession and affect the profitability of listed companies.
The dividend market in Hong Kong was unstable last year.
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(Photo by Zhang Haowei)
Although PolyU did not mention losses, it said that the investment and interest income from the University’s working capital is an important source of income for PolyU, which allows PolyU to establish a more stable financial foundation, but the risks generally faced by investments involve interest rates, markets, and exchange rates , and credit, the university has strengthened the governance of investment through the establishment of an investment committee.
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