The University of Calgary's endowment fund has lost $78 million since last March because of the downturn in the financial markets.

The endowment fund, which is now worth $348 million according to university officials, is used to fund scholarships and other programs specified by donors.

Roman Cooney, a spokesman for the university, said officials are optimistic the university will weather the financial storm, just as it did in 2001.

"The university draws down its investment income on what is called a four-year rolling average," he said, "So if you have a bad year or two bad years, you essentially draw from those years where you've had good years.

"But, I have to say if this goes on for an extended period of time – one, two, three, four years  – then I think the university would have to consider reducing the amount that it draws down the endowment fund."

No scholarships or programs funded through the endowment have been affected so far.