Finance Committee Report
                                                         December 13, 1966

   Members, Board of Trustees:

                             INVESTMENT COUNSEL

   Recommendation: that the President be authorized to engage the Chase Manhattan
   Bank, New York, as investment counsel to the Trustees and the University
   Administration for all investments of the University of Kentucky and its affiliated,
   non-profit corporations, and that the President be authorized to appropriate the
   funds necessary for payment of such counsel from the general funds of the Uni-

   Background: With the advent of an organized development program for the
   University and an expected significant increase in permanent endowment and annual
   gifts, the task of conducting the several procedures associated with prudent in-
   vestment will increase markedly.

   The University has a three-fold requirement in its investment policy: the security
   of its investment; annual income to meet commitments; and a growth of the princi-
   pal which will keep the income meaningful in future years.

   Too, the donor of the large gift to be invested this way desires assurance that his
   money will be wisely handled and that the University program which captured his
   interest will receive the greatest benefit possible.

   Of possible investment advisory services investigated in Louisville., Cincinnati,
   and New York, the service provided by the Chase Manhattan Bank of New York is
   recommended as most appropriate to the program of the University of Kentucky.
   The Chase Manhattan Bank as an organization experienced in providing investment
   counsel for university endowment funds and recognized widely for its soundness
   and success would meet all of the needs noted above. The service provided by the
   bank would include investment advice, investment research, and the custody of
   securities. The approach of the bank is aggressive, but is not designed for short-
   term fluctuations or speculation.

   Responsibility for investment decision would remain with the Trustees.

   For these several reasons, to provide as much operating money as possible, to
   provide expertise in investment counsel, to provide continual review and super-
   vision of a rapidly growing portfolio, and to assure the donor of sound stewardship,
   it is desired that the recommendation be approved.

.Act:on: Approved    X     Disapproved          Other_

December 13; 19 66