FUND NEWS                               Jul 28, 2006

Permanent Fund returns 10.98% for FY06

JULY 28 - The Alaska Permanent Fund earned 10.98% for the fiscal year ending June 30, 2006 according to audited figures. The Fund ended the fiscal year with a value of $32.9 billion, $2.9 billion over the ending value on June 30, 2005. That value accounts for statutory transfers out of the Fund for fiscal 2006.

The Alaska Permanent Fund earned 10.98% for the fiscal year ending June 30, 2006 according to audited figures released by the Corporation.

The Fund ended the fiscal year with a value of $32.9 billion, $2.9 billion over the ending value on June 30, 2005. This ending value already accounts for statutory transfers out of the Fund for fiscal 2006, which did not take place until July. $688.6 million was transferred to the Permanent Fund Dividend Division and $36.7 million in Amerada Hess settlement income was transferred to the Department of Revenue to be deposited in the Alaska Capital Income Fund.

Final returns show that the Fund’s non-domestic stock and real estate portfolios had the strongest returns, at 26.1% and 19.96% respectively. Domestic stocks also performed well, returning 10.0% for the year and the absolute return strategies investments returned 11.5%. The bond portfolios had poor returns, with domestic bonds returning -0.3% and non-domestic bonds returning 0.6%. However, both portfolios performed better than their benchmarks of -0.8% and 0.2%, respectively.

Overall, the year was one of strong growth for the first three quarters, despite concerns that Hurricane Katrina, rising fuel prices and global issues would dampen the U.S. economy. The anticipated slowdown came in the final quarter, as stocks took a sharp downturn and the total fund returned -0.9% for the period.

The Permanent Fund returned 10.4% in fiscal 2005, and 14.2% in fiscal 2004.