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<PAGE> PAGE 2
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SIGNATURE NANCY D. CELICK
TITLE PRESIDENT
To the Shareholders and Board of Trustees
of Hotchkis and Wiley Variable Trust
In planning and performing our audit of the financial
statements of the Equity Income VIP Portfolio, the
International VIP Porfolio and the Low Duration VIP
Portfolio (three of the four portfolios of Hotchkis
and Wiley Variable Trust, the "Funds") for the period
ended December 31, 1998, we considered its internal
control, including control activities for safeguarding
securities, in order to determine our auditing procedures
for the purpose of expressing our opinion on the
financial statements and to comply with the requirements
of Form N-SAR, not to provide assurance on internal control.
The management of the Funds is responsible for establishing
and maintaining internal control. In fulfilling this
responsibility, estimates and judgments by management are
required to assess the expected benefits and related costs
of control activities. Generally, control activities that are
relevant to an audit pertain to the entity's objective of
preparing financial statements for external purposes that
are fairly presented in conformity with generally accepted
accounting principles. Those control activities include
the safeguarding of assets against unauthorized acquisition,
use or disposition.
Because of inherent limitations in internal control, errors
or irregularities may occur and not be detected. Also,
projection of any evaluation of internal control to future
periods is subject to the risk that it may become inadequate
because of changes in conditions or that the effectiveness
of the design and operation may deteriorate.
Our consideration of internal control would not necessarily
disclose all matters in internal control that might be
material weaknesses under standards established by the
American Institute of Certified Public Accountants.
A material weakness is a condition in which the design or
operation of any specific internal control components does
not reduce to a relatively low level the risk that errors
or irregularities in amounts that would be material in
relation to the financial statements being audited may
occur and not be detected within a timely period by employees
in the normal course of performing their assigned functions.
However, we noted no matters involving internal control,
including control activities for safeguarding securities,
that we consider to be material weaknesses as defined above
as of December 31, 1998.
This report is intended solely for the information and use
of management and the Securities and Exchange Commission.
PRICEWATERHOUSECOOPERS LLP
Milwaukee, Wisconsin
February 18, 1999
HOTCHKIS AND WILEY VARIABLE TRUST
#77. O) Transactions Subject to Rule 10f-3
Equity Income VIP Portfolio
Name of Issuer: USEC, Inc.
Type of Security: Common Stock
Trade Date: 07/22/98
Maturity Date: N/A
Interest Rate: N/A
Total Shares Purchased: 500
Total Purchase: $7,125
Aggregate shares of offering: 100,000,000
Aggregate value of offering: $1,425,000,000
Securities acquired from: Morgan Stanley
Underwriting Syndicate's Members: Merrill Lynch, Pierce, Fenner
& Smith, Inc.
Morgan Stanley & Co. Inc.
M.R. Beal & Company
Janney Montgomery Scott, Inc.
Lehman Brothers, Inc.
Prudential Securities Inc.
Smith Barney, Inc.
International VIP Portfolio
Name of Issuer: Sonera OYJ
Type of Security: Common Stock
Trade Date: 11/10/98
Maturity Date: N/A
Interest Rate: N/A
Total Shares Purchased: 24,842
Total Purchase: 1,117,890 FIM
Aggregate shares of offering: 100,150,000
Aggregate value of offering: 4,506,750,000 FIM
Securities acquired from: Kleinwort & Benson
Underwriting Syndicate's Members: Credit Suisse First Boston
Goldman Sachs International
