The financially strapped University of California system is losing about $6 million each year due to risky bets on interest rates.
The Orange County Register reports that the UC system already has lost tens of millions of dollars on complex contracts known as interest-rate swaps.
Under the contracts, future losses would be reduced only if interest rates rise from their historically low levels.
The university's chief financial officer, Peter Taylor, told the newspaper he is confident interest rates will eventually rise, reversing the losses.
The losses come as administrators of the 10-campus system have sharply increased tuition and fees in recent years, angering many students who say they are being priced out of a public education.