SEI Quick Poll: Higher Education Institutions Feel Investment Portfolios Impacting Credit Ratings

Most Think Lack of Diversification and Liquidity Could Result in Downgrade

OAKS, Pa., March 9, 2009 – An SEI (NASDAQ: SEIC) Quick Poll released today shows that nearly all (97 percent) higher education institutions polled - public and private – feel that current financial metrics have put them at risk for a credit downgrade. Metrics tied to the endowment’s investment portfolio concern most, as 84 percent said lack of diversification could cause a downgrade. Lack of liquidity in the investment portfolio (65 percent) is another concern yet nearly half (46 percent) of respondents said their institutions lack a formal liquidity management policy.

The poll, completed by 57 executives overseeing asset pools ranging in size from $25 million to over $1 billion, demonstrates that despite the lack of a formal liquidity policy, many organizations have significant allocations to illiquid asset classes such as private equity, venture capital, and private real estate. Nearly two-thirds (60 percent) of the participants said despite ongoing volatility they still prefer active management over indexing.

“A lack of alignment between investment strategies and the overall financial strategies of the organization is causing significant challenges in a time of great market volatility,” said Carolyn McLaurin, Vice President and Managing Director of SEI’s Nonprofit Group. “It is crucial that endowments evaluate traditional processes and find better ways to manage the impact that changing capital markets have on spending and growth.”

The poll shows that while credit ratings remain a concern for both public and private institutions, private institutions fared worse in terms of performance. In fact all (100 percent) of the public or state universities with a credit rating reported a rating of Aa or better, while only 38 percent of private institutions reported ratings of Aa or better. Additionally, one-third (33 percent) of private institutions with a rating said their rating was Baa or worse. Higher education institutions see numerous factors that could lead to possible downgrades including operating performance (74 percent), multiple or large borrowing programs (69 percent), decrease in fundraising income (31 percent), and increased financial aid spending (18 percent).

A complete summary of the poll is available by emailing seiresearch@seic.com.

About SEI’s Institutional Group

SEI’s Global Institutional Group delivers integrated retirement, healthcare and nonprofit solutions to over 340 U.S. institutional clients and 500 global institutional clients in six different countries. SEI enables clients to meet financial objectives, reduce business risk, and fulfill their due diligence requirements through implemented strategies for the management of defined benefit plans, defined contribution plans, endowments, foundations and other balance sheet assets. For more information, visit http://www.seic.com/institutions.

About SEI

SEI (NASDAQ:SEIC) is a leading global provider of outsourced asset management, investment processing and investment operations solutions. The company’s innovative solutions help corporations, financial institutions, financial advisors, and affluent families create and manage wealth. As of December 31, 2008, through its subsidiaries and partnerships in which the company has a significant interest, SEI administers $380 billion in mutual fund and pooled assets and manages $134 billion in assets. SEI serves clients, conducts or is registered to conduct business and/or operations, from more than 20 offices in over a dozen countries. For more information, visit www.seic.com.