Harvard’s endowment grew $3.3 billion during the fiscal year ending June 30, 2006,  reaching an all-time high of $29.2 billion, according to figures released today.

The Harvard Management Company (HMC), the internal arm responsible for managing the University’s endowment, returned 16.7 percent on its investments. While this year’s performance was slightly above the median return for the 25 largest university endowments, it is down from last year’s 19.2 percent return and the 21.1 percent return achieved in 2004.

The endowment growth comes during a transition period for HMC after the Sept. 2005 departure of former chief Jack R. Meyer. Meyer and over 30 of his employees left HMC to form the hedge fund Convexity Capital Management. New chief Mohamad A. El-Erian took over in Feb. 2006.

“The most important issue is, did we meet the University's target which is to maintain the value of the endowment and take into account distributions and inflation?” El-Erian said. “Yes, we came in at double that amount.”

HMC outperformed its benchmarks in all but two asset classes, with particularly strong performance from international equities, emerging equities, and commodities. Emerging markets earned the highest returns, at 37.8 percent, in line with HMC’s increased emphasis on a global outlook.

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—Staff writer Cyrus M. Mossavar-Rahmani can be reached at crahmani@fas.harvard.edu.