Solid at Home

Of course, we’ve also been very focused on our core business here in the U.S. While we were not immune to the financial pressures caused by the volatility in the markets and have certainly done some belt-tightening as would be expected, participants can be assured of CBIS’ financial solidity. Our portfolios were not exposed to the reckless derivative trading or lending that has imperiled some financial institutions. We suspended securities lending for cash collateral in late 2007 due to our concern about the quality of collateral we would have received, and we strategically sought to minimize the risk of net asset value (NAV) deterioration and counterparty risk in anticipation of major investment banks failing or recapitalizing. Participant assets are safe and liquid, and CBIS is not at risk of financial failure.

I’m also pleased to report on the continued good work of the FSC Foundation. CBIS, the foundation’s primary benefactor, formed the FSC Foundation in 1987, and donates a portion of our profits whenever possible to support its vitally important work. The foundation offers financial aid for educational programs that serve poor and marginalized members of society victimized by prejudice based on social status, language or other characteristics. In 2008, our support for the FSC Foundation funded 71 grants totaling $191,000 for 35 domestic and 36 foreign recipients. Though the individual grants are not large, they serve communities which do not have access to funding from large foundations, and many grants enable innovative and creative educational programs that fall outside traditional classroom settings. Since its founding in 1987, the FSC Foundation has made 1,236 grants and distributed more than $3 million in grant monies. I’m sorry to say that we will not be able to fund the FSC Foundation this year due to the financial pressures of 2008, but we will resume our support as soon as possible.