Belmont University tapped Goldman Sachs Group Inc. for a margin loan this summer to raise cash, in a sign that even larger universities are facing budget strains.
The Nashville-based institution, which has almost 9,000 undergrad and grad students, entered into a "margin loan agreement" in May against its unrestricted investment advisory accounts at Goldman, according to bond documents released in August.
The proceeds "were used to provide short-term cash management and liquidity," the documents said. Belmont then used $59 million of board-designated endowment funds, which are used to support operations, to repay the loan on July 30.
Even highly-rated, well-known institutions are dealing with more financial pressure due to a shrinking pool of undergraduates. Summer can be an especially difficult time as schools wait for tuition revenue to come in for the fall semester. Across the country, more colleges are turning to their endowments to smooth budgets and fill in deficits.
Since 2017, Belmont has been spending on sprucing up its 93-acre campus located two miles from downtown Nashville. The school disclosed details around the margin loan in the documents for a $126 million debt sale, with the proceeds to be used for financing costs of construction for new facilities.
The university used the margin loan after significant campus investment, according to a statement from Julia Copeland, a spokesperson for Belmont.
"This strategic, one-time transfer from unrestricted investments was intended to improve liquidity and cash management strategies and better align the investment in long-term assets with long-term funding," the statement said. "The temporary credit facility served its intended purpose and has been fully repaid and closed."
A spokesperson for Goldman declined to comment.
Belmont, a Christian institution, is known for its ties to country music and even launched
The school said in bond documents that it's working to improve its financial performance, including through partnerships like Dolly U. It's also reining in expenses and has added more staff to a budget office. Belmont reported that cash dropped to about $8.9 million in fiscal 2025, down from $18.7 million the prior year.
The school's endowment and similar funds totaled $434 million in 2025. That includes funds restricted by donors for certain uses as well as unrestricted funds that university officials have discretion over. More than 70% of the endowment is restricted.
Belmont is just the latest school to disclose challenges. New York's Syracuse University, for example, said it's
Belmont expects revenue to exceed expenses in fiscal 2026.
Bolstering Finances
S&P Global Ratings downgraded Belmont in late July to A-minus from A, citing "significant" increases in debt. Analysts led by Travis Nauert also cited "softer operating margins relative to historical levels that we expect will continue given its growth in operating expenses."
Belmont's stable enrollment, budget surpluses and competent management earned the school a stable outlook from the rating agency, which had dropped
Its most recently audited financial report shows that the school has about $390 million in total liabilities, not including this month's bond sale.
Enrollment has remained strong, but revenue shrank slightly in 2025. Fewer students are paying to live on campus and the school is handing out more aid to cover tuition, with college-funded grants and scholarships growing by more than 50% since 2021.
"Belmont remains in a strong financial position, with an A-minus credit rating with stable outlook from S&P, strong investor demand for its recent bond issuance, and ongoing efforts by the University to preserve and strengthen operating performance," the university's spokesperson said.
Goldman served as an underwriter on the university's muni bond offering in August. Debt due in 2041 priced to yield 4.46%, 86 basis points higher than AAA debt.
