FUND NEWS                               Jan 22, 2008

Permanent Fund still ahead after turbulent second quarter

JANUARY 22 - The Alaska Permanent Fund lost a little ground in the second quarter of fiscal year 2008, with a total return of -0.5%, ahead of the benchmark return of -0.6%. This brought the Fund`s return to 2.0% for the fiscal year-to-date with a value of $38.9 billion on December 31, 2007.

The Alaska Permanent Fund lost a little ground in the second quarter of fiscal year 2008, with a total return of -0.5%, ahead of the benchmark return of -0.6%. This brought the Fund`s return to 2.0% for the fiscal year-to-date with a value of $38.9 billion on December 31, 2007.

"Essentially we`re a little ahead of where we started at the beginning of the fiscal year, and our portfolios still have the unrealized gains that we`ve accumulated since 2003," said Michael Burns, Chief Executive Officer. "We`re not happy to see a period of down markets, but we`re not surprised after the rapid expansion we saw over the last few years."

Rallies in the global stock markets started at the end of the first quarter and carried into October, but the continued effects of failures in the subprime mortgage market and rising oil prices caused markets to falter.

The Permanent Fund`s U.S. stock portfolio returned -3.1% for the quarter, the non-U.S. stock portfolio returned 0.4% for the quarter, and the global stock portfolio returned -2.1% for the quarter. While the U.S. stock portfolio is down for the fiscal year-to-date, the non-U.S. and global portfolios are effectively even, with returns below 1.0%.

Bonds, on the other hand, have had solid returns, with the U.S. portfolio returning 2.6% for the quarter and 5.4% for the year-to-date, while the non-U.S. portfolio returned 2.7% for the quarter, and 8.0% for the year-to-date. The Fund`s real estate was down for the quarter at -1.7%, but positive returns in the first quarter helped the asset class hold steady at 0.5% for the year-to-date. The Fund`s absolute return investments returned 1.8% for the quarter and 2.2% for the year-to-date.

As of December 31, the Permanent Fund had earned $2.1 billion in statutory net income, the amount used to calculate the dividend. This Permanent Fund`s median case projection is $2.5 billion for the full fiscal year.