<PAGE> 1
- -------------------------------------------------------------------------------
-
PROVIDENT
- -------------------------------------------------------------------------------
INSTITUTIONAL
FUNDS
-
------------------------------------------------------------------
400 Bellevue Parkway, Wilmington, DE 19809 - Phone:
302-792-2555 - Fax: 302-792-5876
G. Willing Pepper
Chairman TRUST FOR FEDERAL SECURITIES
June 16, 1997
Dear Shareholder:
We are pleased to present the Semi-Annual Report to Shareholders of Trust
for Federal Securities for the period ended April 30, 1998. The accompanying
Investment Adviser's Report provides information on the economy, money markets,
and our Funds.
Provident Institutional Funds offer a variety of high quality Taxable and
Tax-Exempt Money Market Funds to meet the varied needs of our investors. Please
contact your account representative or call our Client Service Center at (800)
821-7432 to discuss your investment options. We welcome the opportunity to serve
you.
Sincerely,
[G. Willing Pepper signature]
G. Willing Pepper
Chairman
<PAGE> 2
TRUST FOR FEDERAL SECURITIES
SEMI-ANNUAL INVESTMENT ADVISER'S REPORT
The U.S. economy finished 1997 in strong style, as fourth quarter gross
domestic product (GDP) demonstrated that the Asian crisis had less of a
dampening effect than was initially anticipated. With a recently revised
estimate of 4.8% GDP growth, first quarter reports continued to depict strong
business activity and low inflation. In fact, for the twelve months ended April
30, 1998 prices at the wholesale level declined 1.2%, while consumer prices
increased by only 1.4%. New home sales led first quarter growth, which benefited
from low interest rates, heightened job security and surging personal wealth. In
response to this best of both worlds environment, the Federal Reserve has not
changed monetary policy in over a year. We predict that the outlook for
short-term interest rates will largely depend on the Asian situation with a
slight easing of policy if the economy slows, and a small tightening if it
continues to grow at better than a 3.5% pace. In the meantime, we anticipate
that rates should remain near current levels, with overnight yields around
5.50%. The short-term yield curve should also remain quite flat, with only
modest incremental yield opportunity in six to twelve-month agency obligations.
Treasury bills and short coupons will probably remain expensive, with even
one-year yields offered below overnight repurchase agreement rates.
The treasury and agency money market curves flattened in early 1998 amid
favorable reports on inflation and prospects for slower growth due to the Asian
financial crisis. Assets of FedFund and T-Fund were primarily invested in
overnight repurchase agreement during this period due to its yield advantage
over alternative instruments. Consequently, the average weighted maturities of
such funds were generally at the lower end of their target ranges. A reversal in
sentiment occurred after Federal Reserve Chairman Alan Greenspan's
Humphrey-Hawkins testimony in late February. While the Fed remained on hold
throughout the remainder of the period, a temporary increase in yields and a
steepening of the treasury and agency money market curves prompted investments
in securities at the longer end of the curves and an extension in average
weighted maturities. Treasury Trust followed a similar strategy of extending its
average weighted maturity upon the steepening of the curve, with cash management
bills providing an important source of liquidity. Federal Trust and Treasury
Trust retained their AAA Standard & Poor's ratings, while T-Fund remained
AAA-rated from both Standard & Poor's and Moody's. Finally, FedFund received a
Moody's rating of Aaa in April.
BLACKROCK INSTITUTIONAL MANAGEMENT CORPORATION
2
<PAGE> 3
FEDFUND PORTFOLIO
Trust for Federal Securities
Statement of Net Assets
April 30, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PAR
MATURITY (000) VALUE
-------- -------- --------------
<S> <C> <C> <C>
U.S. GOVERNMENT AGENGY & INSTRUMENTALITY OBLIGATIONS--57.5%
Federal Farm Credit Bank Variable Rate Notes+
5.534%............ 05/01/98 $ 30,000 $ 29,987,716
--------------
Federal Home Loan Bank Bonds
5.96.............. 06/09/98 20,000 20,001,129
5.78.............. 07/07/98 10,000 9,997,981
5.725............. 09/08/98 13,335 13,330,349
5.80.............. 10/27/98 27,000 27,021,851
5.81.............. 11/04/98 8,735 8,736,582
5.825............. 12/17/98 16,500 16,496,751
5.385............. 01/22/99 6,500 6,490,247
5.43.............. 02/24/99 17,750 17,729,496
5.555............. 02/26/99 19,000 19,000,000
5.595............. 03/10/99 27,895 27,891,527
5.605............. 03/12/99 15,000 14,995,650
5.56.............. 03/25/99 10,000 9,989,385
--------------
191,680,948
--------------
Federal Home Loan Mortgage Corporation
Variable Rate Notes+
5.4463............ 05/20/98 17,500 17,497,801
--------------
Federal National Mortgage Association Bonds
5.84.............. 06/10/98 25,000 25,000,324
5.84.............. 06/18/98 14,000 13,999,403
5.63.............. 08/14/98 15,000 14,990,507
6.10.............. 09/04/98 5,105 5,110,025
5.37.............. 02/26/99 10,000 9,980,350
5.60.............. 04/22/99 10,000 9,985,820
--------------
79,066,429
--------------
Federal National Mortgage Association
Variable Rate Notes+
5.324............. 05/05/98 58,000 58,000,000
5.543............. 05/05/98 20,000 19,990,603
5.4775............ 05/18/98 30,000 29,981,160
--------------
107,971,763
--------------
Student Loan Marketing Association Bonds
6.25.............. 06/30/98 6,000 6,004,940
5.63.............. 08/06/98 20,000 19,999,170
5.775............. 09/09/98 10,000 9,998,797
5.79.............. 09/16/98 5,000 5,000,893
--------------
41,003,800
--------------
</TABLE>
<TABLE>
<CAPTION>
PAR
MATURITY (000) VALUE
-------- -------- --------------
<S> <C> <C> <C>
Student Loan Marketing Association
Variable Rate Notes+
5.263%............ 05/05/98 $ 58,545 $ 58,524,951
5.273............. 05/05/98 10,000 10,000,000
5.283............. 05/05/98 20,000 20,001,274
5.448............. 05/05/98 25,000 24,991,562
5.473............. 05/05/98 25,000 25,000,000
5.573............. 05/05/98 20,000 19,996,183
--------------
158,513,970
--------------
Total................................ 625,722,427
--------------
REPURCHASE AGREEMENTS--42.3%
Goldman Sachs & Co
5.53.............. 05/01/98 200,000 200,000,000
(Agreement dated 04/30/98 to
be repurchased at
$200,030,722,
collateralized by
$299,705,560 Federal Home
Loan Mortgage Corporation
Bonds and Federal National
Mortgage Association Bonds
5.937% to 6.80% due from
10/25/18 to 10/15/27. The
market value is
$206,000,000.)
Greenwich Capital Markets, Inc.
5.52.............. 05/01/98 25,000 25,000,000
(Agreement dated 04/30/98 to
be repurchased at
$25,003,833,
collateralized by
$45,548,000 Resolution
Funding Corporation STRIPS
due 07/15/05 to 10/15/10.
The market value is
$25,750,162.)
</TABLE>
3
<PAGE> 4
FEDFUND PORTFOLIO
Statement of Net Assets (Concluded)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PAR
MATURITY (000) VALUE
-------- -------- --------------
<S> <C> <C> <C>
REPURCHASE AGREEMENTS (CONTINUED)
Morgan Stanley & Co
5.5625%........... 05/01/98 $200,000 $ 200,000,000
(Agreement dated 04/30/98 to
be repurchased at
$200,030,903,
collateralized by
$221,054,000 Federal Home
Loan Mortgage Corporation
Bonds, Federal National
Mortgage Association Bonds
and Medium Term Notes,
Resolution Funding
Corporation Notes and U.S.
Treasury Bills from 0.00%
to 8.90% due from 12/10/98
to 07/15/20. The market
value is $206,585,499.)
5.5125............ 05/01/98 34,500 34,500,000
(Agreement dated 04/30/98 to
be repurchased at
$34,505,283,
collateralized by
$85,935,000 U.S. Treasury
STRIPS due from 08/15/98
to 05/15/21. The market
value is $35,200,462.)
--------------
Total..............................
459,500,000
--------------
</TABLE>
<TABLE>
<CAPTION>
VALUE
--------------
<S> <C> <C> <C>
TOTAL INVESTMENTS IN SECURITIES
(Cost $1,085,222,427*)....... 99.8% $1,085,222,427
OTHER ASSETS IN EXCESS OF
LIABILITIES.................. 0.2 1,772,444
------ --------------
</TABLE>
<TABLE>
<CAPTION>
VALUE
--------------
<S> <C> <C> <C>
NET ASSETS(equivalent to $1.00
per share based on
1,059,706,607 FedFund and
27,590,863 FedFund Dollar
Shares of beneficial interest
outstanding)................. 100.0% $1,086,994,871
====== ==============
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE
($1,086,994,871 divided by 1,087,297,470)..... $1.00
=====
</TABLE>
- ---------------
* Also cost for federal income tax purposes.
+ Variable rate obligations--the rate shown is the rate as of April 30, 1998,
and the maturity date shown is the longer of the next interest readjustment
date or the date the principal amount can be recovered upon demand.
FEDFUND PORTFOLIO
Maturity Schedule of Portfolio
April 30, 1998
(Unaudited)
<TABLE>
<CAPTION>
MATURITY
PERIOD PAR PERCENTAGE
------------- ------------ ----------
<S> <C> <C> <C> <C>
1- 30 Days $773,545,000 71.3%
31- 60 Days 59,000,000 5.4
61- 90 Days 16,000,000 1.5
91-120 Days 35,000,000 3.2
121-150 Days 33,440,000 3.1
Over 150 Days 168,380,000 15.5
Average Weighted Maturity--56 Days
- -------------------------------------------------
</TABLE>
See accompanying notes to financial statements.
4
<PAGE> 5
T-FUND PORTFOLIO
Trust for Federal Securities
Statement of Net Assets
April 30, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PAR
MATURITY (000) VALUE
-------- -------- --------------
<S> <C> <C> <C>
U.S. GOVERNMENT SECURITIES--25.1%
U.S. Treasury Notes
5.375%............ 05/31/98 $ 19,000 $ 18,997,020
6.00.............. 05/31/98 20,000 20,005,584
6.25.............. 06/30/98 39,000 39,037,919
8.25.............. 07/15/98 15,000 15,072,625
6.25.............. 07/31/98 57,000 57,088,894
5.875............. 08/15/98 50,000 50,026,851
9.25.............. 08/15/98 25,000 25,251,670
4.75.............. 08/31/98 19,000 18,948,172
4.75.............. 09/30/98 74,000 73,729,736
5.875............. 10/31/98 34,000 34,040,331
5.50.............. 11/15/98 30,000 29,978,478
5.875............. 01/31/99 75,000 75,175,785
5.00.............. 02/15/99 10,000 9,958,714
8.875............. 02/15/99 25,000 25,639,800
5.50.............. 02/28/99 25,000 24,991,781
6.25.............. 03/31/99 50,000 50,324,844
7.00.............. 04/15/99 20,000 20,256,343
6.375............. 04/30/99 122,000 123,018,442
--------------
Total................................ 711,542,989
--------------
REPURCHASE AGREEMENTS--74.7%
Barclay De Zoet Wedd Securities, Inc.
5.51.............. 05/01/98 125,000 125,000,000
(Agreement dated 04/30/98 to
be repurchased at
$125,019,132,
collateralized by
$128,520,000 U.S.
Inflation Indexed
Securities 3.625% due
4/15/28. The market value
is $127,504,043.)
Deutsche Morgan Grenfell, Inc.
5.44.............. 05/01/98 125,000 125,000,000
(Agreement dated 04/30/98 to
be repurchased at
$125,018,889,
collateralized by
$126,167,000 U.S. Treasury
Notes 5.875% to 6.625% due
from 10/31/98 to 06/30/01.
The market value is
$127,502,224.)
Goldman Sachs & Co.
5.43.............. 05/06/98 150,000 150,000,000
(Agreement dated 02/05/98 to
be repurchased at
$152,036,250,
collateralized by
$158,498,400 U.S. Treasury
Bills and Notes 0.00% to
5.625% due from 11/03/98
to 02/04/99. The market
value is $153,000,316.)
</TABLE>
<TABLE>
<CAPTION>
PAR
MATURITY (000) VALUE
-------- -------- --------------
<S> <C> <C> <C>
5.52%............. 05/01/98 $100,000 $ 100,000,000
(Agreement dated 04/30/98 to
be repurchased at
$100,015,333,
collateralized by
$105,665,600 U.S. Treasury
Bills and Notes 0.00% to
5.625% due from 11/30/98
to 02/04/99. The market
value is $102,000,211.)
Greenwich Capital Markets, Inc.
5.52.............. 05/01/98 250,000 250,000,000
(Agreement dated 04/30/98 to
be repurchased at
$250,038,333,
collateralized by
$200,052,000 U.S.
Inflation Indexed
Securities and Treasury
Bonds 3.625% to 13.875%
due from 08/15/05 to
04/15/28. The market value
is $255,001,928.)
Hong Kong Shanghai Bank
Securities, Inc.
5.47.............. 05/01/98 125,000 125,000,000
(Agreement dated 04/30/98 to
be repurchased at
$125,018,993,
collateralized by
$99,416,000 U.S. Treasury
Bonds 10.375% due
11/15/09. The market value
is $127,501,020.)
Lehman Brothers, Inc.
5.52.............. 05/01/98 200,000 200,000,000
(Agreement dated 04/30/98 to
be repurchased at
$200,030,667,
collateralized by
$175,656,000 U.S. Treasury
Bonds and Notes 6.00% to
11.75% due from 05/31/02
to 08/15/26. The market
value is $204,001,472.)
5.52.............. 05/01/98 100,000 100,000,000
(Agreement dated 04/30/98 to
be repurchased at
$100,015,333,
collateralized by
$98,425,000 U.S. Treasury
Notes 6.25% due 06/30/02.
The market value is
$102,002,574.)
</TABLE>
5
<PAGE> 6
T-FUND PORTFOLIO
Statement of Net Assets (Concluded)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PAR
MATURITY (000) VALUE
-------- -------- --------------
<S> <C> <C> <C>
REPURCHASE AGREEMENTS (CONTINUED)
Merrill Lynch Government
Securities, Inc.
5.41%............. 05/14/98 $150,000 $ 150,000,000
(Agreement dated 04/14/98 to
be repurchased at
$150,676,250,
collateralized by
$278,462,000 U.S. Treasury
Notes and STRIPS 5.875% to
8.875% due from 01/31/99
to 11/15/27. The market
value is $153,000,986.)
Morgan (J.P.) Securities, Inc.
5.50.............. 05/01/98 125,000 125,000,000
(Agreement dated 04/30/98 to
be repurchased at
$125,019,097,
collateralized by
$115,269,000 U.S. Treasury
Bonds 6.25% to 7.125% due
from 02/15/23 to 08/15/23.
The market value is
$127,500,725.)
Morgan Stanley & Co., Inc.
5.5125............ 05/01/98 315,600 315,600,000
(Agreement dated 04/30/98 to
be repurchased at
$315,648,326,
collateralized by
$307,279,000 U.S. Treasury
Bills, Bonds and Notes
0.00% to 9.25% due from
08/06/98 to 08/15/23. The
market value is
$323,069,265.)
Salomon Brothers, Inc.
5.52.............. 05/01/98 125,000 125,000,000
(Agreement dated 04/30/98 to
be repurchased at
$125,019,167,
collateralized by
$95,400,000 U.S. Treasury
Bonds 8.75% due 08/15/20.
The market value is
$127,559,951.)
SBC Warburg Dillon Read, Inc.
5.25.............. 05/01/98 97,000 97,000,000
(Agreement dated 04/30/98 to
be repurchased at
$97,014,146,
collateralized by
$81,731,000 U.S. Treasury
Bonds and Notes 5.75% to
10.375% due from 04/30/03
to 08/15/25. The market
value is $99,716,564.)
</TABLE>
<TABLE>
<CAPTION>
PAR
MATURITY (000) VALUE
-------- -------- --------------
<S> <C> <C> <C>
UBS Securities, Inc.
5.52%............. 05/01/98 $125,000 $ 125,000,000
(Agreement dated 04/30/98 to
be repurchased at
$125,019,167,
collateralized by
$124,095,000 U.S. Treasury
Notes 5.625% to 7.125% due
from 05/15/99 to 02/29/00.
The market value is
$127,500,825.)
--------------
Total.............................. 2,112,600,000
--------------
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
TOTAL INVESTMENTS IN SECURITIES
(Cost $2,824,142,989*).......... 99.8% 2,824,142,989
OTHER ASSETS IN EXCESS OF
LIABILITIES................... 0.2 4,260,154
------ --------------
NET ASSETS (equivalent to $1.00
per share based on
2,221,526,511 T-Fund and
606,938,121 T-Fund Dollar
Shares of beneficial interest
outstanding.)................. 100.0% $2,828,403,143
====== ==============
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE
($2,828,403,143 divided by 2,828,464,632).. $1.00
=====
</TABLE>
- ---------------
* Also cost for federal income tax purposes.
- --------------------------------------------------
T-FUND PORTFOLIO
Maturity Schedule of Portfolio
April 30, 1998
(Unaudited)
<TABLE>
<CAPTION>
MATURITY
PERIOD PAR PERCENTAGE
------------- -------------- ----------
<S> <C> <C> <C> <C>
1- 30 Days $2,112,600,000 74.9%
31- 60 Days 39,000,000 1.4
61- 90 Days 54,000,000 1.9
91-120 Days 132,000,000 4.7
121-150 Days 19,000,000 0.6
Over 150 Days 465,000,000 16.5
Average Weighted Maturity--55 Days
- --------------------------------------------------
</TABLE>
See accompanying notes to financial statements.
6
<PAGE> 7
FEDERAL TRUST FUND PORTFOLIO
Trust for Federal Securities
Statement of Net Assets
April 30, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PAR
MATURITY (000) VALUE
-------- ------- ------------
<S> <C> <C> <C>
U.S. GOVERNMENT AGENCY & INSTRUMENTALITY OBLIGATIONS--100.2%
Federal Farm Credit Bank Discount Notes
5.37%................ 05/11/98 $10,000 $ 9,985,083
5.3799............... 05/12/98 15,000 14,975,342
5.40................. 05/12/98 1,360 1,357,756
5.37................. 05/15/98 31,437 31,371,349
5.38................. 05/20/98 4,200 4,188,075
5.38................. 08/20/98 20,000 19,668,233
------------
81,545,838
------------
Federal Farm Credit Bank
Variable Rate Notes+
5.534................ 05/01/98 15,000 14,993,857
------------
Federal Home Loan Bank Bonds
5.72................. 07/07/98 15,000 15,006,700
5.775................ 10/30/98 1,680 1,681,429
------------
16,688,129
------------
Federal Home Loan Bank Discount Notes
5.36................. 05/13/98 11,400 11,379,632
5.36................. 05/15/98 25,000 24,947,889
5.35................. 06/19/98 30,000 29,781,542
------------
66,109,063
------------
Federal Home Loan Bank
Variable Rate Notes+
5.31................. 05/01/98 15,000 14,993,399
------------
Student Loan Marketing Association
Discount Notes
5.43................. 05/01/98 30,000 30,000,000
------------
Student Loan Marketing Association
Variable Rate Notes+
5.263................ 05/05/98 5,000 4,993,939
5.273................ 05/05/98 30,000 30,000,000
5.308................ 05/05/98 1,000 999,259
------------
35,993,198
------------
Tennessee Valley Authority Discount Notes
5.4199............... 06/12/98 25,000 24,841,917
5.34................. 06/16/98 10,000 9,931,767
------------
34,773,684
------------
</TABLE>
<TABLE>
<CAPTION>
VALUE
------------
<S> <C> <C> <C>
TOTAL INVESTMENTS IN SECURITIES
(Cost $295,097,168*)............. 100.2% $295,097,168
LIABILITIES IN EXCESS OF OTHER
ASSETS........................... (0.2) (469,550)
------- ------------
NET ASSETS (equivalent to $1.00 per
share based on 261,722,717
Federal Trust and 33,102,722
Federal Trust Dollar Shares of
beneficial interest
outstanding)..................... 100.0% $294,627,618
====== ============
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE
($294,627,618 / 294,825,439)............... $1.00
=====
</TABLE>
- ---------------
* Also cost for federal income tax purposes.
+ Variable Rate Obligations--the rate shown is the rate as
of April 30, 1998, and the maturity date shown is the
longer of the next interest readjustment date or the date
the principal amount can be recovered upon demand.
- ------------------------------------------------
FEDERAL TRUST FUND PORTFOLIO
Maturity Schedule of Portfolio
April 30, 1998
(Unaudited)
<TABLE>
<CAPTION>
MATURITY
PERIOD PAR PERCENTAGE
------------- ------------ ----------
<S> <C> <C> <C> <C>
1- 30 Days $194,397,000 65.7%
31- 60 Days 65,000,000 21.9
61- 90 Days 15,000,000 5.1
91-120 Days 20,000,000 6.7
Over 150 Days 1,680,000 0.6
Average Weighted Maturity--28 Days
- ------------------------------------------------
</TABLE>
See accompanying notes to financial statements.
7
<PAGE> 8
TREASURY TRUST FUND PORTFOLIO
Trust for Federal Securities
Statement of Net Assets
April 30, 1998
(Unaudited)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PAR
MATURITY (000) VALUE
-------- -------- --------------
<S> <C> <C> <C>
U.S. GOVERNMENT SECURITIES--99.3%
U.S. Treasury Bills
3.75%............. 05/07/98 $ 65,000 $ 64,959,375
4.40.............. 05/21/98 100,000 99,755,556
4.50.............. 05/21/98 100,000 99,750,000
3.75.............. 05/28/98 68,000 67,808,750
3.9999............ 05/28/98 40,000 39,880,000
4.5399............ 05/28/98 100,000 99,659,500
4.56.............. 05/28/98 40,000 39,863,200
4.86.............. 06/11/98 25,000 24,861,625
4.7799............ 06/18/98 15,000 14,904,400
4.9849............ 10/15/98 40,000 39,075,006
--------------
590,517,412
--------------
U.S. Treasury Notes
6.125............. 05/15/98 63,730 63,749,161
9.00.............. 05/15/98 78,640 78,753,994
5.375............. 05/31/98 100,000 99,989,583
6.00.............. 05/31/98 95,000 95,046,929
8.25.............. 07/15/98 50,000 50,299,479
6.25.............. 07/31/98 28,570 28,636,599
5.875............. 08/15/98 80,000 80,109,445
9.25.............. 08/15/98 10,000 10,109,065
4.75.............. 08/31/98 25,000 24,948,678
6.125............. 08/31/98 50,000 50,120,010
6.00.............. 09/30/98 15,000 15,037,556
5.875............. 10/31/98 10,000 10,015,369
5.875............. 02/28/99 25,000 25,065,755
--------------
631,881,623
--------------
</TABLE>
<TABLE>
<CAPTION>
VALUE
--------------
<S> <C> <C> <C>
TOTAL INVESTMENTS IN SECURITIES
(Cost $1,222,399,035*)............. 99.3% $1,222,399,035
OTHER ASSETS IN EXCESS OF
LIABILITIES...................... 0.7 8,071,804
------ --------------
NET ASSETS (equivalent to $1.00 per
share based on 784,468,705
Treasury Trust and 446,329,701
Treasury Trust Dollar Shares of
beneficial interest
outstanding)..................... 100.0% $1,230,470,839
====== ==============
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
($1,230,470,839 divided by 1,230,798,406).. $1.00
=====
</TABLE>
- ---------------
* Also cost for federal income tax purposes.
- -------------------------------------------------
TREASURY TRUST FUND PORTFOLIO
Maturity Schedule of Portfolio
April 30, 1998
(Unaudited)
<TABLE>
<CAPTION>
MATURITY
PERIOD PAR PERCENTAGE
------------- ------------ ----------
<S> <C> <C> <C> <C>
1- 30 Days $655,370,000 53.5%
31- 60 Days 235,000,000 19.2
61- 90 Days 50,000,000 4.1
91-120 Days 118,570,000 9.7
121-150 Days 75,000,000 6.1
Over 150 Days 90,000,000 7.4
Average Weighted Maturity--53 Days
- -------------------------------------------------
</TABLE>
See accompanying notes to financial statements.
8
<PAGE> 9
TRUST FOR FEDERAL SECURITIES
Statements of Operations
Six Months Ended April 30, 1998
(Unaudited)
<TABLE>
<CAPTION>
FEDERAL TREASURY
TRUST TRUST
FEDFUND T-FUND FUND FUND
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- ----------- ---------- -----------
<S> <C> <C> <C> <C>
Investment Income:
Interest income........................................... $35,289,084 $75,644,208 $7,870,825 $33,200,921
----------- ----------- ---------- -----------
Expenses:
Investment advisory fee................................... 788,341 1,703,136 177,378 775,433
Administration fee........................................ 788,341 1,703,136 177,378 775,433
Trustees' fees and officer's salary....................... 15,439 29,304 3,478 14,016
Transfer agent fee........................................ 28,562 56,142 6,171 32,570
Custodian fee............................................. 106,143 173,561 34,831 105,368
Shareholder computer access program....................... 5,472 8,145 -- 2,887
Legal and audit........................................... 14,052 31,553 3,152 13,758
Registration fees and expenses............................ 11,772 7,119 7,145 8,117
Printing.................................................. 2,628 5,486 1,628 2,743
Other..................................................... 15,310 28,027 5,565 15,865
----------- ----------- ---------- -----------
1,776,060 3,745,609 416,726 1,746,190
Service Organization fees--Dollar Shares.................. 86,962 651,461 48,293 455,315
----------- ----------- ---------- -----------
1,863,022 4,397,070 465,019 2,201,505
Less fees waived.......................................... (519,196) (1,032,059) (132,927) (507,885)
----------- ----------- ---------- -----------
Total expenses.......................................... 1,343,826 3,365,011 332,092 1,693,620
----------- ----------- ---------- -----------
Net investment income..................................... 33,945,258 72,279,197 7,538,733 31,507,301
Realized gain (loss) on investments:
Net realized gain (loss) from security transactions....... 2,574 3,997 13,383 (85,497)
----------- ----------- ---------- -----------
Net increase in net assets resulting from operations...... $33,947,832 $72,283,194 $7,552,116 $31,421,804
=========== =========== ========== ===========
</TABLE>
See accompanying notes to financial statements.
9
<PAGE> 10
TRUST FOR FEDERAL SECURITIES
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
FEDFUND PORTFOLIO T-FUND PORTFOLIO
----------------------------------- -----------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1998 OCTOBER 31, 1997 APRIL 30, 1998 OCTOBER 31, 1997
---------------- ---------------- ---------------- ----------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C>
Increase (decrease) in net assets:
Operations:
Net investment income............................. $ 33,945,258 $ 75,164,053 $ 72,279,197 $ 109,434,440
Net gain (loss) on investments.................... 2,574 (23,331) 3,997 8,808
--------------- ---------------- ---------------- ----------------
Net increase in net assets resulting from
operations...................................... 33,947,832 75,140,722 72,283,194 109,443,248
--------------- ---------------- ---------------- ----------------
Distributions to shareholders:
From net investment income:
FedFund Shares.................................. (32,145,267) (71,336,960) -- --
FedFund Dollar Shares........................... (1,799,991) (3,827,093) -- --
T-Fund Shares................................... -- -- (58,917,891) (87,961,168)
T-Fund Dollar Shares............................ -- -- (13,361,306) (21,473,272)
--------------- ---------------- ---------------- ----------------
Total distributions to shareholders........... (33,945,258) (75,164,053) (72,279,197) (109,434,440)
--------------- ---------------- ---------------- ----------------
Capital share transactions (at $1 per share):
Sale of shares.................................... 3,694,446,575 10,159,957,992 14,352,365,523 22,232,918,782
Reinvestment of dividends......................... 7,850,479 15,153,501 14,352,195 24,571,259
Repurchase of shares.............................. (3,952,477,544) (10,359,191,055) (13,819,742,440) (21,834,949,208)
--------------- ---------------- ---------------- ----------------
Increase (decrease) in net assets derived from
capital share transactions...................... (250,180,490) (184,079,562) 546,975,278 422,540,833
--------------- ---------------- ---------------- ----------------
Total increase (decrease) in net assets....... (250,177,916) (184,102,893) 546,979,275 422,549,641
Net assets:
Beginning of period................................. 1,337,172,787 1,521,275,680 2,281,423,868 1,858,874,227
--------------- ---------------- ---------------- ----------------
End of period....................................... $ 1,086,994,871 $ 1,337,172,787 $ 2,828,403,143 $ 2,281,423,868
=============== ================ ================ ================
</TABLE>
See accompanying notes to financial statements.
10
<PAGE> 11
TRUST FOR FEDERAL SECURITIES
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
FEDERAL TRUST TREASURY TRUST
FUND PORTFOLIO FUND PORTFOLIO
----------------------------------- -----------------------------------
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1998 OCTOBER 31, 1997 APRIL 30, 1998 OCTOBER 31, 1997
---------------- ---------------- ---------------- ----------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C>
Increase (decrease) in net assets:
Operations:
Net investment income............................. $ 7,538,733 $ 14,504,526 $ 31,507,301 $ 61,147,163
Net gain (loss) on investments.................... 13,383 (8,037) (85,497) 32,503
------------- --------------- --------------- ---------------
Net increase in net assets resulting from
operations...................................... 7,552,116 14,496,489 31,421,804 61,179,666
------------- --------------- --------------- ---------------
Distributions to shareholders:
From net investment income:
Federal Trust Shares............................ (6,553,696) (12,745,296) -- --
Federal Trust Dollar Shares..................... (985,037) (1,759,230) -- --
Treasury Trust Shares........................... -- -- (22,565,764) (43,994,646)
Treasury Trust Dollar Shares.................... -- -- (8,941,537) (17,152,517)
------------- --------------- --------------- ---------------
Total distributions to shareholders........... (7,538,733) (14,504,526) (31,507,301) (61,147,163)
------------- --------------- --------------- ---------------
Capital share transactions (at $1 per share):
Sale of shares.................................... 716,925,305 1,113,408,997 4,563,296,752 8,110,835,799
Reinvestment of dividends......................... 929,726 1,777,322 9,133,224 20,130,709
Repurchase of shares.............................. (691,233,123) (1,147,812,970) (4,459,927,985) (8,204,831,424)
------------- --------------- --------------- ---------------
Increase (decrease) in net assets derived from
capital share transactions...................... 26,621,908 (32,626,651) 112,501,991 (73,864,916)
------------- --------------- --------------- ---------------
Total increase (decrease) in net assets....... 26,635,291 (32,634,688) 112,416,494 (73,832,413)
Net assets:
Beginning of period................................. 267,992,327 300,627,015 1,118,054,345 1,191,886,758
------------- --------------- --------------- ---------------
End of period....................................... $ 294,627,618 $ 267,992,327 $ 1,230,470,839 $ 1,118,054,345
============= =============== =============== ===============
</TABLE>
See accompanying notes to financial statements.
11
<PAGE> 12
TRUST FOR FEDERAL SECURITIES
Financial Highlights
(For a Share Outstanding Throughout Each Period)
<TABLE>
<CAPTION>
FEDFUND SHARES
----------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR ENDED OCTOBER 31,
APRIL 30, --------------------------------------------------------------
1998 1997 1996 1995 1994 1993
----------- ---------- ---------- ---------- ---------- ----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Period..... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ---------- ----------
Income From Investment
Operations:
Net Investment Income... .0269 .0530 .0529 .0571 .0377 .0308
Net Capital Gains....... -- -- -- -- -- .0001
---------- ---------- ---------- ---------- ---------- ----------
Total From Investment
Operations.......... .0269 .0530 .0529 .0571 .0377 .0309
---------- ---------- ---------- ---------- ---------- ----------
Less Distributions:
Dividends to
Shareholders from:
Net Investment Income... (.0269) (.0530) (.0529) (.0571) (.0377) (.0308)
Net Capital Gains....... -- -- -- -- -- (.0001)
---------- ---------- ---------- ---------- ---------- ----------
Total Distributions... (.0269) (.0530) (.0529) (.0571) (.0377) (.0309)
---------- ---------- ---------- ---------- ---------- ----------
Net Asset Value,
End of Period........... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== ========== ========== ========== ==========
Total Return............. 5.51%(2) 5.43% 5.41% 5.86% 3.84% 3.12%
Ratios/Supplemental Data:
Net Assets, End of Period
$(000).................. $1,059,436 $1,220,857 $1,407,529 $1,377,175 $1,557,562 $1,290,971
Ratio of Expenses to
Average Daily Net
Assets(1)............... .20%(2) .20% .19% .18% .18% .20%
Ratio of Net Investment
Income to Average
Daily Net Assets........ 5.40%(2) 5.30% 5.29% 5.71% 3.76% 3.08%
<CAPTION>
FEDFUND DOLLAR SHARES
------------------------------------------------------------------
SIX MONTHS
ENDED YEAR ENDED OCTOBER 31,
APRIL 30, ----------------------------------------------------
1998 1997 1996 1995 1994 1993
----------- -------- -------- -------- -------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value,
Beginning of Period..... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- -------- -------- --------
Income From Investment
Operations:
Net Investment Income... .0256 .0505 .0504 .0546 .0352 .0283
Net Capital Gains....... -- -- -- -- -- .0001
-------- -------- -------- -------- -------- --------
Total From Investment
Operations.......... .0256 .0505 .0504 .0546 .0352 .0284
-------- -------- -------- -------- -------- --------
Less Distributions:
Dividends to
Shareholders from:
Net Investment Income... (.0256) (.0505) (.0504) (.0546) (.0352) (.0283)
Net Capital Gains....... -- -- -- -- -- (.0001)
-------- -------- -------- -------- -------- --------
Total Distributions... (.0256) (.0505) (.0504) (.0546) (.0352) (.0284)
-------- -------- -------- -------- -------- --------
Net Asset Value,
End of Period........... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======== ======== ========
Total Return............. 5.26%(2) 5.18% 5.16% 5.61% 3.59% 2.87%
Ratios/Supplemental Data:
Net Assets, End of Period
$(000).................. $27,559 $116,316 $113,747 $213,177 $135,769 $169,877
Ratio of Expenses to
Average Daily Net
Assets(1)............... .45%(2) .45% .44% .43% .43% .45%
Ratio of Net Investment
Income to Average
Daily Net Assets........ 5.15%(2) 5.05% 5.04% 5.46% 3.51% 2.83%
</TABLE>
- ---------------
(1) Without the waiver of advisory and administration fees, the ratio of
expenses to average daily net assets would have been .28% (annualized) for
the six months ended April 30, 1998 and .29%, .30%, .29%, .30% and .27%,
respectively, for the years ended October 31, 1997, 1996, 1995, 1994, and
1993 for FedFund Shares, and .53% (annualized) for the six months ended
April 30, 1998 and .54%, .55%, .54%, .55% and .52%, respectively, for the
years ended October 31, 1997, 1996, 1995, 1994 and 1993 for FedFund Dollar
Shares.
(2) Annualized
See accompanying notes to financial statements.
12
<PAGE> 13
TRUST FOR FEDERAL SECURITIES
Financial Highlights
(For a Share Outstanding Throughout Each Period)
<TABLE>
<CAPTION>
T-FUND SHARES
----------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR ENDED OCTOBER 31,
APRIL 30, --------------------------------------------------------------
1998 1997 1996 1995 1994 1993
----------- ---------- ---------- ---------- ---------- ----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning
of Period.................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ---------- ----------
Income From Investment
Operations:
Net Investment Income...... .0266 .0528 .0528 .0565 .0368 .0303
---------- ---------- ---------- ---------- ---------- ----------
Total From Investment
Operations............. .0266 .0528 .0528 .0565 .0368 .0303
---------- ---------- ---------- ---------- ---------- ----------
Less Distributions:
Dividends to Shareholders
from:
Net Investment Income...... (.0266) (.0528) (.0528) (.0565) (.0368) (.0303)
---------- ---------- ---------- ---------- ---------- ----------
Total Distributions...... (.0266) (.0528) (.0528) (.0565) (.0368) (.0303)
---------- ---------- ---------- ---------- ---------- ----------
Net Asset Value, End of
Period..................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
========== ========== ========== ========== ========== ==========
Total Return................ 5.46%(2) 5.41% 5.40% 5.80% 3.75% 3.07%
Ratios/Supplemental Data:
Net Assets, End of Period
$(000)..................... $2,221,474 $1,765,332 $1,507,603 $1,211,220 $1,012,977 $1,361,624
Ratio of Expenses to Average
Daily Net Assets(1)........ .20%(2) .20% .19% .18% .18% .20%
Ratio of Net Investment
Income to Average Daily Net
Assets..................... 5.37%(2) 5.28% 5.26% 5.66% 3.65% 3.03%
<CAPTION>
T-FUND DOLLAR SHARES
---------------------------------------------------------------
SIX MONTHS
ENDED YEAR ENDED OCTOBER 31,
APRIL 30, -------------------------------------------------
1998 1997 1996 1995 1994 1993
----------- -------- -------- ------- ------- -------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning
of Period.................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- -------- -------- ------- ------- -------
Income From Investment
Operations:
Net Investment Income...... .0254 .0503 .0503 .0540 .0343 .0278
-------- -------- -------- ------- ------- -------
Total From Investment
Operations............. .0254 .0503 .0503 .0540 .0343 .0278
-------- -------- -------- ------- ------- -------
Less Distributions:
Dividends to Shareholders
from:
Net Investment Income...... (.0254) (.0503) (.0503) (.0540) (.0343) (.0278)
-------- -------- -------- ------- ------- -------
Total Distributions...... (.0254) (.0503) (.0503) (.0540) (.0343) (.0278)
-------- -------- -------- ------- ------- -------
Net Asset Value, End of
Period..................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======= ======= =======
Total Return................ 5.21%(2) 5.16% 5.15% 5.55% 3.50% 2.82%
Ratios/Supplemental Data:
Net Assets, End of Period
$(000)..................... $606,929 $516,092 $351,271 $82,502 $22,195 $13,328
Ratio of Expenses to Average
Daily Net Assets(1)........ .45%(2) .45% .44% .43% .43% .45%
Ratio of Net Investment
Income to Average Daily Net
Assets..................... 5.12%(2) 5.03% 5.01% 5.41% 3.40% 2.78%
</TABLE>
- ---------------
(1) Without the waiver of advisory and administration fees, the ratio of
expenses to average daily net assets would have been .28% (annualized) for
the six months ended April 30, 1998 and .29%, .30%, .29%, .29% and .28%,
respectively, for the years ended October 31, 1997, 1996, 1995, 1994 and
1993 for T-Fund Shares, and .53% (annualized) for the six months ended April
30, 1998 and .54%, .55%, .54%, .54% and .53%, respectively, for the years
ended October 31, 1997, 1996, 1995, 1994 and 1993 for T-Fund Dollar Shares.
(2) Annualized
See accompanying notes to financial statements.
13
<PAGE> 14
TRUST FOR FEDERAL SECURITIES
Financial Highlights
(For a Share Outstanding Throughout Each Period)
<TABLE>
FEDERAL TRUST SHARES
------------------------------------------------------------------
SIX MONTHS
ENDED YEAR ENDED OCTOBER 31,
APRIL 30, ---------------------------------------------------
1998 1997 1996 1995 1994 1993
----------- ------- ------- ------- ------- -------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of
Period........................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- ------ ------ ------ ------ ------
Income From Investment Operations:
Net Investment Income............ .0265 .0521 .0523 .0563 .0380 .0302
Net Capital Gains................ -- -- -- -- -- .0001
-------- ------ ------ ------ ------ ------
Total From Investment
Operations................... .0265 .0521 .0523 .0563 .0380 .0303
-------- ------ ------ ------ ------ ------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income............ (.0265) (.0521) (.0523) (.0563) (.0380) (.0302)
Net Capital Gains................ -- -- -- -- -- (.0001)
-------- ------ ------ ------ ------ ------
Total Distributions............ (.0265) (.0521) (.0523) (.0563) (.0380) (.0303)
-------- ------ ------ ------ ------ ------
Net Asset Value, End of Period.... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ====== ====== ====== ====== ======
Total Return...................... 5.43%(2) 5.33% 5.35% 5.77% 3.87% 3.06%
Ratios/Supplemental Data:
Net Assets, End of Period
$(000)........................... $261,528 $229,292 $273,752 $237,718 $317,769 $257,125
Ratio of Expenses to Average
Daily Net Assets(1).............. .20%(2) .20% .19% .18% .18% .18%
Ratio of Net Investment
Income to Average Daily
Net Assets....................... 5.36%(2) 5.21% 5.22% 5.61% 3.85% 3.02%
<CAPTION>
FEDERAL TRUST DOLLAR
SHARES
----------------------
SIX MONTHS
ENDED YEAR ENDED OCTOBER 31,
APRIL 30, -----------------------------------------------------
1998 1997 1996 1995 1994 1993
----------- ------- ------- ------- ------- -------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of
Period........................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
------- ----- ----- ----- ----- -----
Income From Investment Operations:
Net Investment Income............ .0253 .0496 .0498 .0538 .0355 .0277
Net Capital Gains................ -- -- -- -- -- .0001
------- ----- ----- ----- ----- -----
Total From Investment
Operations................... .0253 .0496 .0498 .0538 .0355 .0278
------- ----- ----- ----- ----- -----
Less Distributions:
Dividends to Shareholders from:
Net Investment Income............ (.0253) (.0496) (.0498) (.0538) (.0355) (.0277)
Net Capital Gains................ -- -- -- -- -- (.0001)
------- ----- ----- ----- ----- -----
Total Distributions............ (.0253) (.0496) (.0498) (.0538) (.0355) (.0278)
------- ----- ----- ----- ----- -----
Net Asset Value, End of Period.... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======= ===== ===== ===== ===== =====
Total Return...................... 5.18%(2) 5.08% 5.10% 5.52% 3.62% 2.81%
Ratios/Supplemental Data:
Net Assets, End of Period
$(000)........................... $33,100 $38,700 $26,875 $28,402 $8,278 $1,025
Ratio of Expenses to Average
Daily Net Assets(1).............. .45%(2) .45% .44% .43% .43% .43%
Ratio of Net Investment
Income to Average Daily
Net Assets....................... 5.11%(2) 4.96% 4.97% 5.36% 3.60% 2.77%
</TABLE>
- ---------------
(1) Without the waiver of advisory and administration fees, the ratio of
expenses to average daily net assets would have been .29% (annualized) for
the six months ended April 30, 1998 and .31%, .31%, .32%, .31% and .29%,
respectively, for the years ended October 31, 1997, 1996, 1995, 1994 and
1993 for Federal Trust Shares, and .54% (annualized) for the six months
ended April 30, 1998 and .56%, .56%, .57%, .56% and .54%, respectively, for
the years ended October 31, 1997, 1996, 1995, 1994 and 1993 for Federal
Trust Dollar Shares.
(2) Annualized
See accompanying notes to financial statements.
14
<PAGE> 15
TRUST FOR FEDERAL SECURITIES
Financial Highlights
(For a Share Outstanding Throughout Each Period)
<TABLE>
TREASURY TRUST SHARES
-------------------------------------------------------------------
SIX MONTHS
ENDED YEAR ENDED OCTOBER 31,
APRIL 30, -----------------------------------------------------
1998 1997 1996 1995 1994 1993
----------- ------- ------- ------- ------- -------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of
Period.............................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- ------ ------ ------- ------- -------
Income From Investment Operations:
Net Investment Income............... .0256 .0504 .0508 .0545 .0359 .0292
-------- ------ ------ ------- ------- -------
Total From Investment
Operations...................... .0256 .0504 .0508 .0545 .0359 .0292
-------- ------ ------ ------- ------- -------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income............... (.0256) (.0504) (.0508) (.0545) (.0359) (.0292)
-------- ------ ------ ------- ------- -------
Total Distributions............... (.0256) (.0504) (.0508) (.0545) (.0359) (.0292)
-------- ------ ------ ------- ------- -------
Net Asset Value, End of Period....... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ====== ====== ======= ======= =======
Total Return......................... 5.24%(2) 5.16% 5.20% 5.59% 3.65% 2.96%
Ratios/Supplemental Data:
Net Assets, End of Period $(000)..... $784,205 $786,556 $897,659 $1,101,834 $1,016,635 $1,188,412
Ratio of Expenses to Average Daily
Net Assets(1)....................... .20%(2) .20% .19% .18% .18% .18%
Ratio of Net Investment
Income to Average
Daily Net Assets.................... 5.15%(2) 5.04% 5.08% 5.45% 3.57% 2.92%
<CAPTION>
TREASURY TRUST DOLLAR
SHARES
---------------------
SIX MONTHS
ENDED YEAR ENDED OCTOBER 31,
APRIL 30, -------------------------------------------------
1998 1997 1996 1995 1994 1993
----------- ------- ------- ------- ------- -------
(UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of
Period.............................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
-------- ------ ------ ------ ------ ------
Income From Investment Operations:
Net Investment Income............... .0244 .0479 .0483 .0520 .0334 .0267
-------- ------ ------ ------ ------ ------
Total From Investment
Operations...................... .0244 .0479 .0483 .0520 .0334 .0267
-------- ------ ------ ------ ------ ------
Less Distributions:
Dividends to Shareholders from:
Net Investment Income............... (.0244) (.0479) (.0483) (.0520) (.0334) (.0267)
-------- ------ ------ ------ ------ ------
Total Distributions............... (.0244) (.0479) (.0483) (.0520) (.0334) (.0267)
-------- ------ ------ ------ ------ ------
Net Asset Value, End of Period....... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ====== ====== ====== ====== ======
Total Return......................... 4.99%(2) 4.91% 4.95% 5.34% 3.40% 2.71%
Ratios/Supplemental Data:
Net Assets, End of Period $(000)..... $446,266 $331,498 $294,228 $223,272 $181,934 $258,206
Ratio of Expenses to Average Daily
Net Assets(1)....................... .45%(2) .45% .44% .43% .43% .43%
Ratio of Net Investment
Income to Average
Daily Net Assets.................... 4.90%(2) 4.79% 4.83% 5.20% 3.32% 2.67%
</TABLE>
- ---------------
(1) Without the waiver of advisory and administration fees, the ratio of
expenses to average daily net assets would have been .28% (annualized) for
the six months ended April 30, 1998 and .30%, .30%, .29%, .29% and .28%,
respectively, for the years ended October 31, 1997, 1996, 1995, 1994 and
1993 for Treasury Trust Shares, and .53% (annualized) for the six months
ended April 30, 1998 and .55%, .55%, .54%, .54% and .53%, respectively, for
the years ended October 31, 1997, 1996, 1995, 1994 and 1993 for Treasury
Trust Dollar Shares.
(2) Annualized
See accompany notes to financial statements.
15
<PAGE> 16
Notes to Financial Statements
(Unaudited)
A. Trust for Federal Securities (the Company) was established as a Pennsylvania
business trust under a Declaration of Trust originally dated as of May 14, 1975,
and is registered under the Investment Company Act of 1940, as amended, as a
diversified open-end management investment company. The Company consists of four
separate portfolios, FedFund, T-Fund, Federal Trust Fund and Treasury Trust
Fund.
The FedFund portfolio has two classes of shares, FedFund Shares and FedFund
Dollar Shares. The T-Fund portfolio has three classes of shares, T-Fund Shares,
T-Fund Dollar Shares, and T-Fund Plus Shares. Federal Trust Fund portfolio has
two classes of shares, Federal Trust Shares and Federal Trust Dollar Shares.
Treasury Trust Fund portfolio also has two classes of shares, Treasury Trust
Shares and Treasury Trust Dollar Shares. Each portfolio's classes of shares are
identical in all respects, except that Dollar Shares and Plus Shares are sold to
institutions (Service Organizations) which provide support services to their
customers who beneficially own such shares, in consideration of the Company's
payment of 0.25% (on an annualized basis) of the average daily net asset value
of the Dollar Shares or Plus Shares held for the benefit of their customers. The
Service Organization fee is charged to the earnings of the respective Dollar
Shares or Plus Shares. The T-Fund Plus Shares also bear distribution fees of
0.15% (on an annualized basis) of their average daily net asset value payable to
the Company's distributor, Provident Distributors, Inc. (PDI), for distribution
and sales support services. No T-Fund Plus Shares have been sold as of April 30,
1998.
B. Significant accounting policies are as follows:
Use of Estimates--The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statement and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from these
estimates. The following is a summary of significant accounting policies
consistently followed by the Company in the preparation of its financial
statements
Security Valuation--Portfolio securities are valued under the amortized cost
method which approximates current market value. Under this method, securities
are valued at cost when purchased and thereafter a constant proportionate
amortization of any discount or premium is recorded until maturity of the
security. Regular review and monitoring of the valuation is performed in an
attempt to avoid dilution or other unfair results to shareholders. The Company
seeks to maintain the net asset value per share of each portfolio at $1.00.
Repurchase Agreements--The Company may purchase, for FedFund and T-Fund, money
market instruments from financial institutions, such as banks and non-bank
dealers, subject to the seller's agreement to repurchase them at an agreed upon
date and price. Collateral for repurchase agreements may have longer maturities
than the maximum permissible remaining maturity of portfolio investments,
provided the repurchase agreements themselves mature in one year or less. The
seller will be required on a daily basis to maintain the value of the securities
subject to the agreement at no less than the repurchase price. Repurchase
agreements with maturities in excess of seven days are subject to a seven day
put feature.
Dividends to Shareholders--Dividends are declared daily and paid monthly.
Dividends payable are recorded on the dividend record date. Net income for
dividend purposes includes interest accrued, discount earned and net realized
short term gains on portfolio securities, less the amortization of market
premium and applicable expenses. Capital gains, if any, are distributed at least
once a year.
16
<PAGE> 17
Notes to Financial Statements (Continued)
Federal Taxes--No provision is made for federal taxes as it is the Company's
intention to have each portfolio continue to qualify as a regulated investment
company and to make the requisite distributions to its shareholders which will
be sufficient to relieve it from federal income and excise taxes.
Other--Investment transactions are accounted for on the trade date and the
cost of investments sold is determined by use of the specific identification
method for both financial reporting and income tax purposes. Expenses not
directly attributable to a specific portfolio are allocated among the portfolios
based on their relative net assets.
C. Under agreements among the Company, PNC Bank, National Association (PNC Bank)
and Blackrock Institutional Management Corporation (BIMC), an indirect majority
owned subsidiary of PNC Bank, BIMC manages the Company's portfolios and
maintains their financial accounts. PNC Bank is the Company's sub-advisor and
custodian and PFPC Inc. (PFPC) is the Company's transfer agent.
In March 1998, BIMC (formerly known as PNC Institutional Management
Corporation) assumed the responsibilities of PNC Bank, as sub-advisor, to
provide research, credit analysis and recommendations with respect to the Fund's
investments and supply certain computer facilities, personnel and other
services. The personnel, facilities, and expenses related to these services have
been transferred to BIMC and BIMC's obligation to pay to PNC Bank a portion of
the advisory fee has been terminated.
PDI serves as the Company's distributor. No compensation is payable by the
Company to PDI for its distribution services, except that the T-Fund Plus Shares
pay PDI a distribution fee of 0.15% of their average net assets per annum for
distribution and sales support services.
The Company has entered into an Administration Agreement with PFPC and PDI
(the Administrators) for certain administrative services.
In return for their advisory and administrative services, the Company pays
BIMC and the Administrators each a fee, computed daily and payable monthly,
based upon an annualized percentage of the combined average net assets of each
portfolio as follows: .175% of the first $1 billion, .15% of the next $1
billion, .125% of the next $1 billion, .10% of the next $1 billion, .095% of the
next $1 billion, .09% of the next $1 billion, .085% of the next $1 billion and
.08% of net assets in excess of $7 billion.
If expenses borne by any portfolio in any fiscal year exceed the applicable
expense limitation imposed by state securities regulations, the Administrators
and BIMC will each reimburse the portfolio for one-half of any excess expense up
to the amount of fees payable to it (except where such regulations require
reimbursement regardless of the fees payable to it).
The Administrators and BIMC have also agreed to reduce their fees, on an equal
basis, to the extent necessary to ensure that the total operating expenses
(excluding Service Organization fees) of each portfolio do not exceed .20% of
their respective average net assets. For the six months ended April 30, 1998,
the Administrators and BIMC waived, on an equal basis, a total of $519,196 of
the administration and advisory fees payable to them with respect to FedFund,
$1,032,059 with respect to T-Fund, $132,927 with respect to Federal Trust Fund
and $507,885 with respect to Treasury Trust Fund.
Service Organization fees of $533,468 were paid to affiliates of PNC Bank for
the six months ended April 30, 1998.
D. The Company's Declaration of Trust permits the Trustees to authorize the
issuance of an unlimited number of full and fractional shares of beneficial
interest (shares) in the Company and to classify or reclassify any unissued
shares into one or more additional classes of shares.
17
<PAGE> 18
Notes to Financial Statements (Continued)
Transactions in shares of the Company are summarized as follows:
<TABLE>
<CAPTION>
FEDFUND PORTFOLIO
-------------------------------------
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1998 OCTOBER 31, 1997
---------------- ----------------
(UNAUDITED)
<S> <C> <C>
Shares sold:
FedFund................................................ 3,310,719,890 7,982,671,603
FedFund Dollar......................................... 383,726,685 2,177,286,389
Shares issued in reinvestment of dividends:
FedFund................................................ 6,161,818 11,985,551
FedFund Dollar......................................... 1,688,661 3,167,950
Shares repurchased:
FedFund................................................ (3,478,304,686) (8,181,306,912)
FedFund Dollar......................................... (474,172,858) (2,177,884,143)
-------------- --------------
Net decrease in shares............................... (250,180,490) (184,079,562)
============== ==============
</TABLE>
<TABLE>
<CAPTION>
T-FUND PORTFOLIO
------------------------------------
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1998 OCTOBER 31, 1997
---------------- ----------------
(UNAUDITED)
<S> <C> <C>
Shares sold:
T-Fund................................................. 11,759,299,726 18,993,277,228
T-Fund Dollar.......................................... 2,593,065,797 3,239,641,554
Shares issued in reinvestment of dividends:
T-Fund................................................. 11,801,590 21,093,890
T-Fund Dollar.......................................... 2,550,605 3,477,369
Shares repurchased:
T-Fund................................................. (11,314,962,315) (18,756,649,706)
T-Fund Dollar.......................................... (2,504,780,125) (3,078,299,502)
--------------- ---------------
Net increase in shares............................... 546,975,278 422,540,833
=============== ===============
</TABLE>
18
<PAGE> 19
Notes to Financial Statements (Continued)
<TABLE>
<CAPTION>
FEDERAL TRUST FUND PORTFOLIO
------------------------------------
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1998 OCTOBER 31, 1997
---------------- ----------------
(UNAUDITED)
<S> <C> <C>
Shares sold:
Federal Trust........................................... 588,047,757 883,098,652
Federal Trust Dollar.................................... 128,877,548 230,310,345
Shares issued in reinvestment of dividends:
Federal Trust........................................... 812,694 1,604,400
Federal Trust Dollar.................................... 117,032 172,922
Shares repurchased:
Federal Trust........................................... (556,635,577) (929,156,412)
Federal Trust Dollar.................................... (134,597,546) (218,656,558)
------------ ------------
Net increase (decrease) in shares.................... 26,621,908 (32,626,651)
============ ============
</TABLE>
<TABLE>
<CAPTION>
TREASURY TRUST FUND PORTFOLIO
-----------------------------------
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 1998 OCTOBER 31, 1997
---------------- ----------------
(UNAUDITED)
<S> <C> <C>
Shares sold:
Treasury Trust.......................................... 3,345,005,739 6,033,944,270
Treasury Trust Dollar................................... 1,218,291,013 2,076,891,529
Shares issued in reinvestment of dividends:
Treasury Trust.......................................... 2,689,401 8,360,341
Treasury Trust Dollar................................... 6,443,823 11,770,368
Shares repurchased:
Treasury Trust.......................................... (3,349,983,379) (6,153,431,801)
Treasury Trust Dollar................................... (1,109,944,606) (2,051,399,623)
-------------- --------------
Net increase (decrease) in shares.................... 112,501,991 (73,864,916)
============== ==============
</TABLE>
On April 30, 1998, two shareholders held approximately 25% of the outstanding
shares of T-Fund, two shareholders held approximately 45% of the outstanding
shares of Federal Trust Fund and one shareholder held approximately 16% of the
outstanding shares of Treasury Trust Fund.
19
<PAGE> 20
Notes to Financial Statements (Concluded)
E. At April 30, 1998, net assets consisted of:
<TABLE>
<CAPTION>
FEDERAL TREASURY
TRUST TRUST
FEDFUND T-FUND FUND FUND
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
-------------- -------------- ------------ --------------
<S> <C> <C> <C> <C>
Paid-in capital........................ $1,087,297,470 $2,828,464,632 $294,825,439 $1,230,798,406
Accumulated net realized loss on
security transactions................ (302,599) (61,489) (197,821) (327,567)
-------------- -------------- ------------ --------------
$1,086,994,871 $2,828,403,143 $294,627,618 $1,230,470,839
============== ============== ============ ==============
</TABLE>
F. At October 31, 1997, FedFund, T-Fund, Federal Trust, and Treasury Trust had
capital loss carryovers amounting to $305,173, $52,014, $211,204 and $235,332,
respectively, expiring at various times from 2001 to 2005. The capital loss
carryovers are available to offset possible future capital gains of the
corresponding portfolios.
20
<PAGE> 21
BOARD OF TRUSTEES
G. Willing Pepper
Chairman
G. Nicholas Beckwith III
Philip E. Coldwell
Robert R. Fortune
Jerrold B. Harris
Rodney D. Johnson
OFFICERS
Thomas H. Nevin
President
Lisa M. Buono
Treasurer
W. Bruce McConnel, III
Secretary
INVESTMENT ADVISER
BlackRock Institutional Management Corporation
400 Bellevue Parkway
Wilmington, DE 19809
CO-ADMINISTRATORS
PFPC Inc.
400 Bellevue Parkway
Wilmington, DE 19809
Provident Distributors, Inc.
Four Falls Corporate Center
6th Floor
West Conshohocken, PA 19428
DISTRIBUTOR
Provident Distributors, Inc.
Four Falls Corporate Center
6th Floor
West Conshohocken, PA 19428
TRANSFER AGENT
PFPC Inc.
P.O. Box 8950
Wilmington, DE 19885-9628
This report is submitted for
the general information of the
shareholders of the Company.
It is not authorized for
distribution to prospective
investors unless accompanied
or preceded by effective
prospectuses for each
portfolio of the Company,
which contain information
concerning the investment
policies of the portfolios as
well as other pertinent
information.
PIF-SA-003
FEDFUND
T-FUND
FEDERAL TRUST FUND
TREASURY TRUST FUND
Investment Portfolios
Offered by
Trust for Federal Securities
[PFPC LOGO]
Semi-Annual Report
to Shareholders
April 30, 1998
