(Logo of Lion on Braided Rope)
LETTER FROM THE CHAIRMAN
THE PACIFIC CAPITAL FUNDS
OF
CASH ASSETS TRUST
SEMI-ANNUAL REPORT
November 7, 1995
Dear Investor:
We are pleased to provide you with the Semi-Annual Report for The
Pacific Capital Funds of Cash Assets Trust (the "Trust") for the six-month
period ended September 30, 1995.
ECONOMIC REVIEW
The Federal Reserve succeeded in its relentless determination to
temper the pace of business activity in 1994 by raising short-term interest
rates seven times between February 1994 and February 1995. As a result, the
late 1994 - early 1995 robust growth period was replaced by a slower yet
more sustainable growth pattern during the Trust's current report period.
Concurrent with this slower-growth economy has been a relatively low rate of
inflation at both the wholesale and consumer levels. In our judgement, the
restrictive Fed monetary policy pursued during 1994 and the subsequent
easing, if successful, will enable the Fed to execute their desired "soft
landing" of the economy.
MANAGEMENT DISCUSSION
The Trust is comprised of three separate portfolios - Pacific
Capital Cash Assets Trust, Pacific Capital Tax-Free Cash Assets Trust and
Pacific Capital U.S. Treasuries Cash Assets Trust - each with two classes of
shares. While each fund adheres to their own investment objective, they all
share a common theme. That is, there is absolutely no substitute for quality
in maintaining a high level of safety for the cash reserves entrusted to each
fund.
Indeed, to adhere to this policy, Hawaiian Trust Company, Ltd.,
the Trust's Investment Adviser, has continuously acted with great prudence in
examining the creditworthiness and marketability of all issuers of securities
utilized in each funds' investment portfolio. Naturally, concern has also
been excercised to provide a sufficient measure of liquidity within each
portfolio so as to provide whatever ready cash needs exist for our
shareholders.
As a result of this conservative investment policy, each fund
continues to provide its shareholders with competitive yields as compared to
alternative money market investments.
We believe you can take considerable comfort in this investment
management approach.
We wish to thank you for the continued support and confidence you
have placed in The Pacific Capital Funds of Cash Assets Trust.
Sincerely,
/s/ Lacy B. Herrmann
Lacy B. Herrmann
President and Chairman
of the Board of Trustees
<PAGE>
COMMENTS BY THE INVESTMENT ADVISER
PACIFIC CAPITAL CASH ASSETS TRUST
During the first six months of the current fiscal year, Pacific
Capital Cash Assets Trust (the "Cash Fund") continued to provide competitive
returns to alternative short-term investment opportunities without wavering
from its conservative investment approach. This accomplishment was achieved
without sacrificing quality but by paying close attention to market
opportunities and varying the composition of money market securities in the
portfolio. At the end of the current report period, the Cash Fund maintained
a near maximum weighted average maturity, thereby locking in higher yields in
anticipation of further possible interest rate cuts by the Federal Reserve.
PACIFIC CAPITAL TAX-FREE CASH ASSETS TRUST
Like the investment strategy pursued with the Cash Fund, the
Investment Adviser also extended the weighted average days to maturity of
Pacific Capital Tax-Free Cash Assets Trust (the "Tax-Free Fund"). During the
first six months of the current fiscal year, the Tax-Free Fund's average
maturity increased from 52 days to 72 days by September 30, 1995. This
strategy enabled the Tax-Free Fund to maintain a positive yield spread over
comparable tax-free money market funds.
The continuing deterioration in asset quality and profitability
of Japanese banks also affected the Adviser's investment strategy. The
Adviser made the decision to divest the portfolio of its one remaining
security backed by a letter of credit from a Japanese bank, even before the
latest wave of downgrades of these banks by the rating agencies. It's worth
noting that over the past three years, the Adviser has taken a pro-active
position by reducing, when necessary, the Tax-Free Fund's exposure to certain
municipal issues supported by letters of credit or other enhancements from
Japanese banks. Since safety of shareholder principal is paramount, the
Adviser will continue to emphasize the strict adherence of using only
tax-exempt money-market securities of high-quality standards and minimal
credit risks.
PACIFIC CAPITAL U.S. TREASURIES CASH ASSETS TRUST
Investors continue to look at Pacific Capital U.S. Treasuries
Cash Assets Trust (the "Treasuries Fund") as a source of exceptionally high
security for investment of their cash reserves. As most of you are aware,
income derived from investments in U.S. Treasury obligations, in addition to
carrying the full faith and credit of the U.S. Treasury, has the added
benefit of being exempt from State income taxes. Consequently, the Adviser
will attempt to maintain, to the maximum extent possible, as high a
percentage of the portfolio invested in direct obligations of the U.S.
Treasury. Such an investment approach, which shelters income from State
income taxes, increases the overall level of net return that an investor can
achieve through the Treasuries Fund.
2
<PAGE>
<TABLE>
<CAPTION>
PACIFIC CAPITAL
CASH ASSETS TRUST
STATEMENT OF INVESTMENTS
SEPTEMBER 30, 1995 (unaudited)
<C> <S> <C>
Face
Amount Commercial Paper (59.1%) Value
Automotive (2.7%)
$ 10,000,000 Toyota Motor Credit, 5.670%, 10/2/95 $ 9,998,425
Beverages (4.1%)
15,000,000 Coca-Cola Company, 5.630%, 11/16/95 14,892,092
Electrical & Electronic (4.0%)
14,729,000 Hewlett Packard Co., 5.630%, 11/7/95 14,643,772
Finance (24.6%)
15,000,000 National Rural Utilities Cooperative Finance Corp.,
5.720%, 10/12/95 14,973,784
15,000,000 A.I. Credit Corp., 5.650%, 10/17/95 14,962,333
15,000,000 General Electric Capital Corp., 5.733%, 12/27/95 15,000,000
15,000,000 New South Wales Treasury Corp., 5.620%, 12/21/95 14,810,325
15,000,000 Associates Corporation Of North America, 5.758%, 1/26/96 15,000,000
15,000,000 Abbey National North America Corp., 5.600%, 1/8/96 14,769,000
89,515,442
Insurance (6.9%)
10,000,000 USAA Capital Corp., 5.660%, 10/5/95 9,993,711
15,000,000 Safeco Credit Company, 5.620%, 10/13/95 14,971,900
24,965,611
Office Equipment & Services (4.1%)
15,000,000 Pitney Bowes Credit Corp., 5.640%, 11/2/95 14,924,800
Diversified (4.1%)
15,000,000 Cargill, Inc., 5.670%, 10/3/95 14,995,275
Retail (4.1%)
15,000,000 Toys R Us, 5.700%, 10/4/95 14,992,875
Utilities (4.5%)
16,500,000 Southwestern Bell Telephone, 5.630%, 11/28/95 16,350,336
Total Commercial Paper (cost $215,278,628) 215,278,628
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
PACIFIC CAPITAL
CASH ASSETS TRUST
STATEMENT OF INVESTMENTS
<C> <S> <C>
Face
Amount Notes (16.3%) Value
U.S. Government Agencies (12.2%)
$ 100,000 Student Loan Mortgage Association, Variable
Rate Note, 5.689%,
11/01/96 (Resets Weekly-Next Reset 10/3/95) $ 100,000
15,000,000 Federal Home Loan Bank, 5.430%, 2/2/96 14,719,450
15,000,000 Federal Home Loan Mortgage Corp., 5.530%, 10/6/95 14,988,478
15,000,000 Federal National Mortgage Association, 5.420%, 2/20/96 14,679,317
44,487,245
Insurance (4.1%)
15,000,000 Providian Life And Health Insurance Company
Variable Rate Note, 6.260%, 12/29/95(1) 15,000,000
Total Notes (cost $59,487,245) 59,487,245
Repurchase Agreements (24.9%)
45,835,000 Goldman Sachs Group, L.P., 5.900%, due 10/2/95 45,835,000
(Proceeds of $45,857,536 to be received at maturity)
Collateral: $37,405,000 U.S. Treasury Bonds,
8.875%, due 8/15/17
Collateral Market Value $47,129,792
45,000,000 Barclays de Zoete Wedd Securities, Inc., 5.800%, due 10/2/95 45,000,000
Collateral: $24,515,000 U.S. Treasury Bonds, 7.500%,
due 2/29/96 and
$20,000,000 U.S. Treasury Bonds, 6.875%,
due 8/15/25
Collateral Market Value $45,900,773
Total Repurchase Agreements (cost $90,835,000) 90,835,000
Total Investments - 100.3% (cost $365,600,873*) 365,600,873
Liabilities in excess of other assets - (0.3%) (1,404,197)
Net Assets - 100% $364,196,676
</TABLE>
(*) Cost for Federal tax purposes is identical.
(1) Illiquid security. The security is considered
illiquid because it may not be sold and may be
redeemed only upon at least ninety days notice to the
issuer.
4
<PAGE>
<TABLE>
<CAPTION>
PACIFIC CAPITAL
TAX-FREE CASH ASSETS TRUST
STATEMENT OF INVESTMENTS
SEPTEMBER 30, 1995 (unaudited)
<C> <S> <C> <C>
Rating
Face Moody's/
Amount Municipal Securities (99.6%) S&P Value
Arizona (4.7%)
$ 1,000,000 Maricopa County Arizona United High School, 3.750%, 7/1/96 Aa/AA $ 1,000,000
5,100,000 Maricopa County Arizona-PCR-Ref Arizona Public Service, 4.390%,
5/1/29, Putable 10/2/95 P-1/A1+ 5,100,000
Total Arizona 6,100,000
Colorado (0.9%)
1,155,000 Regional Transportation District, Colorado, 4.500%,
6/1/99, Putable 10/9/95 NR/A1+ 1,155,000
Florida (3.7%)
2,755,000 Jacksonville Florida Electric Authority Revenue,
5.000%, 10/1/96 Aa1/AA 2,784,345
2,000,000 Jacksonville Electric Authority Series D1, 3.600%, 12/8/95 P-1/A1+ 2,000,000
Total Florida 4,784,345
Hawaii (38.0%)
1,000,000 Hawaii State General Obligation, 7.800%, 11/1/95 Aa/AA 1,002,909
2,000,000 Hawaii State General Obligation Ref-Ser BG, 6.000%,
11/1/95 Aa/AA 2,003,869
1,000,000 Hawaii State General Obligation Series BH, 5.500%,
3/1/96 Aa/AA 1,005,420
3,000,000 Hawaii State General Obligation Series BW, 6.000%,
3/1/96 Aa/AA 3,027,930
2,000,000 Hawaii State General Obligation Series CA, 4.750%,
1/1/96 Aa/AA 2,003,132
1,000,000 Hawaii State General Obligation Series CD, 3.850%,
2/1/96 Aa/AA 1,000,434
2,000,000 Hawaii State General Obligation Series C, 3.600%,
7/1/96 Aa/AA1,991,032
2,000,000 Hawaii State Department Budget & Finance, 7.700%,
7/1/08, Pre-refunded 7/1/96 @ 102 Aaa/AAA 2,095,954
2,000,000 Honolulu Hawaii City & County Ref Series A, 7.100%,
7/1/96 Aa/AA2,047,330
3,000,000 Honolulu Hawaii City & County Refund & Impt-Ser B,
3.600%, 10/1/95 Aa/AA 3,000,000
520,000 Maui County Hawaii Series A, 3.600%, 6/1/96 Aaa/AAA 520,000
200,000 Hawaii Housing Finance & Development Corporation,
4.400%, 7/1/24, Putable 10/9/95 MIG1/NR 200,000
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
PACIFIC CAPITAL
TAX-FREE CASH ASSETS TRUST
STATEMENT OF INVESTMENTS
<C> <S> <C> <C>
Rating
Face Moody's/
Amount Hawaii (continued) S&P Value
$ 7,400,000 State Of Hawaii Housing Finance & Development Corp.
Revenue, Series A, 4.450%, 7/1/27, Putable 10/9/95 MIG1/NR $ 7,400,000
7,540,000 Hawaii State Department Budget & Finance,
3.750%, 3/1/14, Putable 3/1/96 NR/A1+ 7,540,000
5,000,000 State Of Hawaii Department Of Budget & Finance, 4.250%,
12/1/15, Putable 10/1/95 MIG1/NR 5,000,000
1,000,000 Honolulu City & County General Obligation, 3.700%,
10/3/95 P-1/A1+ 1,000,000
1,550,000 Honolulu City & County General Obligation, 3.550%, 11/1/95 P-1/A1+ 1,550,000
2,000,000 Honolulu City & County General Obligation, 3.600%, 12/1/95 P-1/A1+ 2,000,000
2,000,000 Honolulu City & County General Obligation, 3.850%, 12/6/95 P-1/A1+ 2,000,000
3,300,000 Hawaii State Airports System Revenue Ref, 4.750%, 7/1/96 Aaa/AAA 3,318,895
Total Hawaii 49,706,905
Idaho (4.9%)
6,465,000 Idaho Health Facilities Authority Revenue, 4.800%,
5/1/22, Putable 10/2/95 MIG1/NR 6,465,000
Illinois (2.3%)
3,000,000 Chicago Illinois Adjustable-Tender Notes-Series A, 4.600%,
10/31/96, Putable 10/2/95 MIG1/A1+ 3,000,000
Indiana (7.0%)
4,335,000 City Of Indianapolis, Indiana-Jewish Federation, 4.500%,
4/1/05, Putable 10/4/95 MIG1/NR 4,335,000
1,755,000 Purdue University, Series E, 4.350%, 7/1/11, Putable
10/4/95 MIG1/A1+ 1,755,000
3,100,000 Gary Industrial Environmental Improvement, U.S. Steel
Corp. Project, 4.040%, 7/15/02, Putable 10/15/95 P-1/A1+ 3,100,000
Total Indiana 9,190,000
Iowa (0.5%)
700,000 Indianola Industrial Development Revenue, Hy-Vee Food
Stores, 3.740%, 12/01/04, Putable 10/1/95 NR/A1+ 700,000
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
PACIFIC CAPITAL
TAX-FREE CASH ASSETS TRUST
STATEMENT OF INVESTMENTS
<C> <S> <C> <C>
Rating
Face Moody's/
Amount Kentucky (3.3%) S&P Value
$ 1,815,000 Daviess County, Kentucky Solid Waste Disposal Facilities
Revenue Scott Paper Company Project A, 4.600%,
12/1/23, Putable 10/2/95 MIG1/A1+ $ 1,815,000
2,450,000 Warsaw, Kentucky Industrial Building Rev, 4.500%,
8/1/09, Putable 10/9/95 NR/A1+ 2,450,000
Total Kentucky 4,265,000
Michigan (1.9%)
2,460,000 Farmington Hills, Michigan Hospital Finance Authority,
4.850%, 2/15/16, Putable 10/2/95 MIG1/A1 2,460,000
Minnesota (1.9%)
2,520,000 Minnesota State Housing Finance Agency, 5.250%,
7/1/20, Putable 1/16/96 MIG1/A1+ 2,520,000
New Hampshire (2.1%)
2,700,000 New Hampshire State Individual Development Authority
Revenue Pollution Control Connecticut, 4.500%, 8/1/18,
Putable 10/9/95 NR/A1+ 2,700,000
New Mexico (1.5%)
2,000,000 New Mexico State Highway Commission, 3.800%, 6/15/96 Aa1/AAA 2,000,916
New York (6.3%)
2,500,000 New York, Series B, 4.650%, 10/1/21, Daily Reset, Putable
10/2/95 MIG1/A1+ 2,500,000
2,700,000 City Of New York, New York, Series B, 4.650%, 10/1/22,
Daily Reset, Putable 10/2/95 MIG1/A1+ 2,700,000
3,000,000 New York City Government Obligation Bonds, 4.650%,
8/15/21, Daily Reset, Putable 10/2/95 MIG1/A1+ 3,000,000
Total New York 8,200,000
Ohio (5.0%)
1,895,000 Ohio State Building Authority State Facility, 4.400%,
10/1/95 Aaa/AAA 1,895,000
2,565,000 Ohio State University Series B, 4.400%, 12/1/01,
Putable 10/5/95 MIG1/A1+ 2,565,000
2,030,000 Ohio State University, 4.400%, 12/1/06, Putable 10/5/95 MIG1/A1+ 2,030,000
Total Ohio 6,490,000
</TABLE>
7
<PAGE>
<TABLE>
<CAPTION>
PACIFIC CAPITAL
TAX-FREE CASH ASSETS TRUST
STATEMENT OF INVESTMENTS
<C> <S> <C> <C>
Rating
Face Moody's/
Amount Tennessee (0.6%) S&P Value
$ 820,000 Memphis Tennessee General Obligation, 3.650%, 8/1/96 Aa/AA $ 818,645
Texas (8.4%)
2,500,000 Lower Neches Valley Authority Chevron USA Inc. Project,
3.750%, 2/15/17, Putable 2/15/96 NR/A1+ 2,500,000
1,000,000 Houston Texas Ref-Series A, 4.700%, 3/1/96 Aa/AA 999,794
3,000,000 Texas State Tax & Revenue Anticipation Notes,
4.750%, 8/30/96 MIG1/SP1+ 3,018,443
4,500,000 Port Arthur, Texas Naval District, Star Enterprises Project,
4.500%, 4/1/14, Putable 10/9/95 NR/A1+ 4,500,000
Total Texas 11,018,237
Utah (0.1%)
100,000 Utah Housing Agency Single Familty Mortgage, 4.450%,
1/1/27, Putable 10/9/95 MIG1/NR 100,000
Vermont (2.1%)
2,800,000 Vermont Student Assistance Corporation, 3.900%, 1/1/04,
Putable 10/1/95 MIG1/NR 2,800,000
Wisconsin (4.4%)
1,595,000 Wisconsin State Health Facilities Authority, 4.400%,
1/1/16, Putable 10/4/95 MIG1/A1+ 1,595,000
4,155,000 Wisconsin State Health Facility Authority, 4.400%,
1/1/16, Putable 10/4/95 MIG1/A1+ 4,155,000
Total Wisconsin 5,750,000
Total Investments - 99.6% (cost $130,224,048*) 130,224,048
Other assets in excess of liabilities - 0.4% 574,467
Net Assets - 100% $ 130,798,515
(*) Cost for Federal tax purposes is identical.
</TABLE>
See accompanying notes to financial statements.
8
<PAGE>
<TABLE>
<CAPTION>
PACIFIC CAPITAL
U.S. TREASURIES CASH ASSETS TRUST
STATEMENT OF INVESTMENTS
SEPTEMBER 30, 1995 (unaudited)
<C> <S> <C>
Face
Amount U.S. Treasury Bills (81.0%) Value
$ 6,000,000 5.445%, due 10/19/95 $ 5,983,665
6,000,000 5.330%, due 11/16/95 5,959,137
6,000,000 5.430%, due 12/14/95 5,933,030
3,000,000 5.650%, due 10/5/95 2,998,117
4,000,000 5.690%, due 10/12/95 3,993,046
6,000,000 5.405%, due 11/2/95 5,971,173
6,000,000 5.680%, due 11/9/95 5,963,080
6,000,000 5.285%, due 12/7/95 5,940,984
6,000,000 5.195%, due 1/11/96 5,911,685
6,000,000 5.330%, due 1/25/96 5,896,953
6,000,000 5.225%, due 2/22/96 5,874,600
Total U.S. Treasury Bills (cost $60,425,470) 60,425,470
Repurchase Agreements (19.4%)
9,438,000 Goldman Sachs Group, L.P., 5.900%, due 10/2/95 9,438,000
(Proceeds of $9,442,640 to be received at maturity)
Collateral: $7,480,000 U.S. Treasury Bond, 9.250%, due 2/15/16
Collateral Market Value $9,696,865
5,000,000 Barclays de Zoete Wedd Securities, Inc., 5.800%, 10/2/95 5,000,000
(Proceeds of $5,002,417 to be received at maturity)
Collateral: $3,765,000 U.S. Treasury Bond, 10.375%, due 11/15/12
Collateral Market Value $5,107,100
Total Repurchase Agreements (cost $14,438,000) 14,438,000
Total Investments - 100.4% (cost $74,863,470*) 74,863,470
Liabilities in excess of other assets - (0.4%) (316,289)
Net Assets - 100% $74,547,181
</TABLE>
<TABLE>
(*) Cost for Federal tax purposes is identical.
See accompanying notes to financial statements.
9
<PAGE>
THE PACIFIC CAPITAL FUNDS
OF CASH ASSETS TRUST
STATEMENTS OF ASSETS AND LIABILITIES
SEPTEMBER 30, 1995 (unaudited)
<S> <C> <C> <C>
Cash Tax-Free Treasuries
Fund Fund Fund
ASSETS
Investments, at value $ 365,600,873 $ 130,224,048 $ 74,863,470
(cost: $365,600,873, $130,224,048,
and $74,863,470, respectively)
Cash 406 2,246 494
Interest receivable 237,145 944,292 2,353
Due from Adviser and Administrator 8,694 2,735 1,413
Prepaid expenses and other assets 95,281 25,500 11,171
Total Assets 365,942,399 131,198,821 74,878,901
LIABILITIES:
Dividends payable 1,580,825 333,709 293,124
Adviser and Administrator fees payable 146,257 38,822 17,672
Distribution fees payable 3,581 1,998 813
Accrued expenses 15,060 25,777 20,111
Total Liabilities 1,745,723 400,306 331,720
NET ASSETS $ 364,196,676 $ 130,798,515 $ 74,547,181
NET ASSETS CONSIST Of:
Capital Stock - Authorized an unlimited number
of shares, par value $.01 per share $ 3,650,301 $ 1,307,985 $ 745,472
Additional paid-in capital 361,379,816 129,490,530 73,801,709
Accumulated net realized loss on investments (833,441) _ -
364,196,676 $ 130,798,515 $ 74,547,181
SHARES OF BENEFICIAL INTEREST:
Original Shares Class:
Net Assets $340,252,343 $ 119,152,368 $ 69,753,138
Shares outstanding 341,030,989 119,152,368 69,753,138
Net asset value per share $1.00 $1.00 $1.00
Service Shares Class:
Net Assets $ 23,944,333 $ 11,646,147 $ 4,794,043
Shares outstanding 23,999,128 11,646,147 4,794,043
Net asset value per share $1.00 $1.00 $1.00
</TABLE>
See accompanying notes to financial statements.
10
<PAGE>
<TABLE>
<CAPTION>
THE PACIFIC CAPITAL FUNDS
OF CASH ASSETS TRUST
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1995 (unaudited)
<S> <C> <C> <C>
Cash Tax-Free Treasuries
Investment Income: Fund Fund Fund
Interest income $ 12,840,853 $ 2,603,954 $ 1,940,108
Expenses:
Investment Adviser fees (note C) 758,801 184,124 92,274
Administrator fees (note C) 311,447 73,413 41,232
Legal fees 49,000 16,500 16,000
Trustees fees and expenses 47,000 20,000 15,600
Registration fees and dues 28,500 8,000 8,000
Audit and accounting fees 17,000 14,500 14,000
Shareholders reports and proxy statements 17,500 5,000 4,000
Transfer and shareholder servicing agent fees 12,000 9,000 8,000
Custodian fees (note F) 7,500 9,000 6,400
Insurance 8,300 1,500 1,200
Distribution fees (note C) 14,130 8,052 2,643
Miscellaneous 21,080 4,602 11,328
Total expenses 1,292,258 353,691 220,677
Investment Advisory fees waived (note C) _ _ (28,049)
Administration fees waived (note C) _ _ (9,350)
Net expenses 1,292,258 353,691 183,278
Net investment income 11,548,595 2,250,263 1,756,830
Net realized gain from securities transactions 52,811 _ -
Net increase in net assets resulting from operations $11,601,406 $ 2,250,263 $ 1,756,830
</TABLE>
See accompanying notes to financial statements.
11
<PAGE>
<TABLE>
<CAPTION>
THE PACIFIC CAPITAL FUNDS
OF CASH ASSETS TRUST
STATEMENTS OF CHANGES IN NET ASSETS
(unaudited)
<S> <C> <C> <C> <C> <C> <C>
Cash Fund Tax-Free Fund Treasuries Fund
Six Months Year Six Months Year Six Months Year
Ended Ended Ended Ended Ended Ended
Sept. 30, March 31, Sept. 30, March 31, Sept. 30, March 31,
1995 1995 1995 1995 1995 1995
Increase (Decrease) in Net Assets
Operations:
Net investment income $ 11,548,595 $ 18,849,202 $ 2,250,263 $ 3,895,789 1,756,830 $ 3,076,562
Net realized gain from
securities transactions 52,811 (886,200) - - - -
Net increase in net
assets resulting from
operations 11,601,406 17,963,002 2,250,263 3,895,789 1,756,830 3,076,562
Dividends to shareholders
from net investment income:
Original Shares (11,261,307) (18,837,970) (2,146,986) (3,893,392) (1,704,328) (3,075,242)
Service Shares* (287,288) (11,232) (103,277) (2,397) (52,502) (1,320)
Total dividends to
shareholders from net
investment income (11,548,595) (18,849,202) (2,250,263) (3,895,789) (1,756,830) (3,076,562)
Capital Share Transactions
(at $1.00 per share):
Proceeds from shares sold:
Original Shares 601,848,070 1,449,062,869 167,556,764 522,439,235 159,088,456 330,815,501
Service Shares* 76,346,278 5,517,939 14,875,348 1,729,095 6,832,441 551,733
678,194,348 1,454,580,808 182,432,112 524,168,330 165,920,897 331,367,234
Net asset value of
shares issued in
reinvestment of dividends:
Original Shares 114,076 99,733 72,804 140,087 39,018 27,199
Service Shares* 227,725 2,049 64,793 177 38,380 9
341,801 101,782 137,597 140,264 77,398 27,208
Cost of shares redeemed:
Original Shares (748,471,869) (1,368,709,646) (186,811,880) (498,137,324) (153,408,209) (358,550,736)
Service Shares* (56,076,286) (2,018,578) (4,672,064) (351,202) (2,582,505) (46,015)
(804,548,155) (1,370,728,224) (191,483,944) (498,488,526) (155,990,714) (358,596,751)
Net increase (decrease)
in net assets from
capital share
transactions (126,012,006) 83,954,366 (8,914,235) 25,820,068 10,007,581 (27,202,309)
Total increase (decrease)
in net assets (125,959,195) 83,068,166 (8,914,235) 25,820,068 10,007,581 (27,202,309)
NET ASSETS:
Beginning of period 490,155,871 407,087,705 139,712,750 113,892,682 64,539,600 91,741,909
End of period $ 364,196,676 $ 490,155,871 $ 130,798,515 $139,712,750 $ 74,547,181 $ 64,539,600
</TABLE>
*New class of shares established on January 20, 1995 and commenced
operations on February 1, 1995.
See accompanying notes to financial statements.
12
<PAGE>
THE PACIFIC CAPITAL FUNDS
OF CASH ASSETS TRUST
NOTES TO FINANCIAL STATEMENTS
(unaudited)
Note A - Organization:
Cash Assets Trust (the Trust) was organized on May 7, 1984 as a
Massachusetts business trust and is registered under the Investment Company
Act of 1940 (the 1940 Act) as an open-end investment company.
The Trust consists of the following three investment portfolios (referred
to individually as a Fund and collectively as the Funds): Pacific Capital
Cash Assets Trust (a diversified portfolio which commenced operations on
December 5, 1984), Pacific Capital Tax-Free Cash Assets Trust (a
non-diversified portfolio which commenced operations on April 4, 1989), and
Pacific Capital U.S. Treasuries Cash Assets Trust (a diversified portfolio
which commenced operations on April 4, 1989). The Trust is authorized to
issue for each Fund an unlimited number of shares of $.01 par value in two
classes of shares; the Original Shares Class and the Service Shares Class.
The Original Shares Class includes all currently outstanding shares of each
Fund that were issued prior to January 20, 1995, the date on which the
Capital structure was changed to include two clases rather than one. The two
classes of shares are substantially identical, except that Service Shares
bear the fees that are payable under the Trusts Distribution Plan.
Note B - Significant Accounting Policies:
The following is a summary of significant accounting policies followed by
the Funds in the preparation of their financial statements. The policies are
in conformity with generally accepted accounting principles for investment
companies.
(1) Portfolio valuation: Each Funds portfolio securities are valued by the
amortized cost method permitted in accordance with Rule 2a-7 under the
Investment Company Act of 1940 (the 1940 Act), which, after considering
accrued interest thereon, approximates market. Under this method, a portfolio
security is valued at cost adjusted for amortization of premiums and
accretion of discounts. Amortization of premiums and accretion of discounts
are included in interest income.
(2) Securities transactions and related investment income: Securities
transactions are recorded on the trade date. Realized gains and losses from
securities transactions are reported on the identified cost basis. Interest
income is recorded daily on the accrual basis and is adjusted for
amortization of premiums and accretion of discounts as discussed in the
preceding paragraph.
(3) Determination of net asset value and calculation of expenses: The net
asset value per share for each class of the Funds shares is determined as of
4:00 p.m. New York time on each day that the New York Stock Exchange is open
by dividing the value of the assets of the Fund allocable to that class less
Fund liabilities allocable to the class and any liabilities charged directly
to the class, exclusive of surplus, by the total number of shares of the
class outstanding. Investment income, realized and unrealized gains and
losses, if any, and expenses other than class specific expenses, are
allocated daily to each class of shares based upon the proportion of net
assets of each class. Class specific expenses are borne by the affected
class. Service fee payments under Rule 12b-1 are borne solely by and charged
to the Service Shares based on net assets of that class.
13
<PAGE>
THE PACIFIC CAPITAL FUNDS
OF CASH ASSETS TRUST
NOTES TO FINANCIAL STATEMENTS (continued)
(unaudited)
(4) Federal income taxes: It is the policy of each Fund to qualify as a
regulated investment company by complying with the provisions of the Internal
Revenue Code applicable to certain investment companies. Each Fund intends to
make distributions of income and securities profits sufficient to relieve it
from all, or substantially all, Federal income and excise taxes.
(5) Repurchase agreements: It is each Funds policy to monitor closely the
creditworthiness of all firms with which it enters into repurchase
agreements, and to take possession of, or otherwise perfect its security
interest in, securities purchased under agreements to resell. The securities
purchased under agreements to resell are marked to market every business day
so that the value of the collateral is at least equal to the value of the
loan (repurchase agreements being defined as loans in the 1940 Act),
including the accrued interest earned thereon, plus sufficient additional
market value as is considered necessary to provide a margin of safety.
Note C - Management Fee and Other Transactions with Affiliates:
Hawaiian Trust Company, Limited (the Adviser) serves as Investment
Adviser to the Trust. In this role, under Investment Advisory Agreements, the
Adviser supervises the Funds investments and provides various services. The
Funds also have Administration Agreements with Aquila Management Corporation
(the Administrator, formerly Sub-Adviser and Administrator) to provide all
administrative services to the Funds other than those relating to the
investment portfolio and the maintenance of the accounting books and records.
Specific details as to the nature and extent of the services provided by the
Adviser and the Administrator are more fully defined in the Prospectus and
Statement of Additional Information of the Funds. For their services, the
Adviser and the Administrator each receive a fee which is payable monthly and
computed as of the close of business each day on the net assets of each Fund
at the following annual rates:
Pacific Capital Cash Assets Trust - On net assets up to $325 million, the
fee is paid to the Adviser and the Administrator at the rate of 0.33% and
0.17%, respectively and on net assets above that amount at the rate of 0.43%
and 0.07%, respectively. For the six months ended September 30, 1995, the
Fund incurred fees under the Advisory Agreement and the Administration
Agreement of $758,801 and $311,447, respectively.
Pacific Capital Tax-Free Cash Assets Trust - On net assets up to $95
million, the fee is paid to the Adviser and the Administrator at the rate of
0.27% and 0.13%, respectively and on net assets above that amount at the rate
of 0.33% and 0.07%, respectively. For the six months ended September 30,
1995, the Fund incurred fees under the Advisory Agreement and the
Administration Agreement of $184,124 and $73,413, respectively.
Pacific Capital U.S. Treasuries Cash Assets Trust - On net assets up to
$60 million, the fee is paid to the Adviser and the Administrator at the rate
of 0.27% and 0.13%, respectively and on net assets above that amount at the
rate of 0.33% and 0.07%, respectively. For the six months ended September 30,
1995, the Fund incurred fees under the Advisory Agreement and the
Administration Agreement of $92,274 and $41,332, respectively, of which the
Adviser and the Administrator voluntarily waived $28,049 and $9,350,
respectively.
14
<PAGE>
THE PACIFIC CAPITAL FUNDS
OF CASH ASSETS TRUST
NOTES TO FINANCIAL STATEMENTS (continued)
(unaudited)
The Adviser and the Administrator each agrees that the above fees shall
be reduced, but not below zero, by an amount equal to its proportionate share
(determined on the basis of the respective fees computed as described above)
of the amount, if any, by which the total expenses of a Fund in any fiscal
year, exclusive of taxes, interest and brokerage fees, shall exceed the
lesser of (i) 2.5% of the first $30 million of average annual net assets of
the Fund plus 2% of the next $70 million of such assets and 1.5% of its
average annual net assets in excess of $100 million, or (ii) 25% of the
Funds total annual investment income. The payment of the above fees at the
end of any month will be reduced or postponed so that at no time will there
be any accrued but unpaid liability under this expense limitation. No such
reduction in fees was required during the six months ended September 30,
1995.
Under a Distribution Agreement, Aquila Distributors, Inc. (the
Distributor) serves as the exclusive distributor of the Funds shares. No
compensation or fees are paid to Aquila Distributors, Inc. for such share
distribution.
Each Fund has adopted a Distribution Plan (the Plan) pursuant to Rule
12bb1 under the 1940 Act. A part of the Plan authorizes payment of certain
distribution or service fees by the Service Shares class of the Fund. Such
payments are made to Designated Payees-broker-dealers, other financial
institutions and service providers who have entered into appropriate
agreements with the Distributor and which have rendered assistance in the
distribution and/or retention of the Funds Service Shares or in the servicing
of Service Share accounts. The total payments under this part of a Funds Plan
may not exceed 0.25 of 1% of its average annual assets represented by Service
Shares. No such payments will be made by the Original Share class. Specific
details about each Plan are more fully defined in the Prospectus and
Statement of Additional Information of the Funds.
Note D - Distributions:
The Funds declare dividends daily from net investment income and make
payments monthly in additional shares at the net asset value per share or in
cash, at the shareholders option.
Note E - Guarantees of Certain Commercial Paper:
Various banks and other institutions have issued irrevocable letters of
credit or guarantees for the benefit of the holders of certain commercial
paper. Payment at maturity of principal and interest of certain commercial
paper held by the Funds is supported by such letters of credit or guarantees.
Note F - Custodian Fees:
The Funds have an agreement with their custodian to receive credit toward
the reduction of custodian fees whenever there are uninvested cash balances.
During the six months ended September 30, 1995, credits of $4,200, $900 and
$500 were used to offset custodian fees of the Cash Fund, the Tax-Free Fund
and the Treasuries Fund, respectively.
15
<PAGE>
<TABLE>
<CAPTION>
PACIFIC CAPITAL FUNDS
CASH ASSETS TRUST
FINANCIAL HIGHLIGHTS
(unaudited)
For a share outstanding throughout each period
<S> <C> <C> <C> <C> <C> <C> <C> <C>
SERVICE SHARES(1) ORIGINAL SHARES(2)
Six Months Period Six Months Year ended March 31,
Ended Ended Ended
Sept. 30, March 31, Sept. 30,
1995 1995** 1995 1995 1994 1993 1992 1991
Net Asset Value,
Beginning of Period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Income from Investment
Operations:
Net investment
income 0.03 0.01 0.03 0.04 0.03 0.03 0.05 0.07
Less Distributions:
Dividends from net
investment income (0.03) (0.01) (0.03) (0.04) (0.03) (0.03) (0.05) (0.07)
Net Asset Value,
End of Period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Total Return 2.59%# 0.85%# 2.72%# 4.40% 2.74% 3.15% 5.20% 7.73%
Ratios/Supplemental Data
Net Assets,
End of Period
(in millions) $23.9 $3.5 $340.3 $486.7 $407.1 $268.0 $275.7 $367.3
Ratio of Expenses
to Average
Net Assets 0.84%* 0.83%* 0.59%* 0.59% 0.59% 0.61% 0.60% 0.58%
Ratio of Net Investment
Income to Average
Net Assets 5.01%* 5.26%* 5.37%* 4.40% 2.71% 3.13% 5.19% 7.51%
</TABLE>
(1) New class of shares established on January 20, 1995.
(2) Designated as the Original Shares class of shares on January 20, 1995.
** For the period from February 1, 1995 (commencement of operations)
to March 31, 1995.
# Not annualized.
* Annualized.
See accompanying notes to financial statements.
16
<PAGE>
<TABLE>
<CAPTION>
PACIFIC CAPITAL
TAX-FREE CASH ASSETS TRUST
FINANCIAL HIGHLIGHTS
(unaudited)
For a share outstanding throughout each period
<S> <C> <C> <C> <C> <C> <C> <C> <C>
SERVICE SHARES(1) ORIGINAL SHARES(2)
Six Months Period Six Months Year ended March 31,
Ended Ended Ended
Sept. 30, March 31, Sept. 30,
1995 1995** 1995 1995 1994 1993 1992 1991
Net Asset Value,
Beginning of Period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Income from Investment
Operations:
Net investment income 0.02 0.01 0.02 0.03 0.02 0.02 0.04 0.05
Less Distributions:
Dividends from net
investment income (0.02) (0.01) (0.02) (0.03) (0.02) (0.02) (0.04) (0.05)
Net Asset Value,
End of Period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Total Return 1.64%# 0.52%# 1.76%# 2.74% 2.02% 2.52% 3.91% 5.55%
Ratios/Supplemental Data
Net Assets,
End of Period
(in millions) $11.6 $1.4 $119.2 $138.3 $113.9 $69.3 $100.0 $85.8
Ratio of Expenses
to Average
Net Assets 0.78%* 0.77%* 0.53%* 0.55% 0.56% 0.54% 0.42% 0.32%
Ratio of Net
Investment
Income to Average
Net Assets 3.16%* 3.22%* 3.48%* 2.74% 1.99% 2.52% 3.89% 5.44%
</TABLE>
For the years 1994, 1993, 1992 and 1991, investment income per share and the
ratios of income and expenses to average net assets without the Advisers and
Administrators voluntary waiver of fees would have been:
<TABLE>
<S> <C> <C> <C> <C>
Net Investment Income $0.02 $0.02 $0.04 $0.05
Ratio of Expenses to Average
Net Assets 0.58% 0.59% 0.56% 0.55%
Ratio of Net Investment
Income to Average Net
Assets 1.97% 2.47% 3.75% 5.21%
</TABLE>
(1) New class of shares established on January 20, 1995.
(2) Designated as the Original Shares class of shares on January 20, 1995.
** For the period from February 1, 1995 (commencement of operations) to
March 31, 1995.
# Not annualized.
* Annualized.
See accompanying notes to financial statements.
17
<PAGE>
<TABLE>
<CAPTION>
PACIFIC CAPITAL
U.S. TREASURIES CASH ASSETS TRUST
FINANCIAL HIGHLIGHTS
(unaudited)
For a share outstanding throughout each period
<S> <C> <C> <C> <C> <C> <C> <C> <C>
SERVICE SHARES(1) ORIGINAL SHARES(2)
Six Months Period Six Months Year ended March 31,
Ended Ended Ended
Sept. 30, March 31, Sept. 30,
1995 1995** 1995 1995 1994 1993 1992 1991
Net Asset Value,
Beginning of Period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Income from Investment
Operations:
Net investment income 0.02 0.01 0.03 0.04 0.03 0.03 0.05 0.07
Less Distributions:
Dividends from net
investment income (0.02) (0.01) (0.03) (0.04) (0.03) (0.03) (0.05) (0.07)
Net Asset Value,
End of Period $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Total Return 2.54%# 0.94%# 2.66%# 4.20% 2.59% 2.90% 5.20% 7.56%
Ratios/Supplemental Data
Net Assets,
End of Period
(in millions) $4.8 $0.5 $69.8 $64.0 $91.7 $26.1 $40.3 $40.6
Ratio of Expenses
to Average
Net Assets 0.78%* 0.85%* 0.54%* 0.54% 0.52% 0.61% 0.34% 0.23%
Ratio of Net
Investment
Income to Average Net
Assets 4.89%* 5.09%* 5.22%* 4.04% 2.58% 2.96% 5.28% 7.10%
</TABLE>
Net investment income per share and the ratios of income and expenses to
average net assets without the Advisers and Administrators voluntary waiver
of fees would have been:
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net Investment Income $0.02 $0.01 $0.03 $0.04 - $0.03 $0.05 $0.07
Ratio of Expenses
to Average
Net Assets 0.90%* 0.98%* 0.65%* 0.59% _ 0.66% 0.60% 0.63%
Ratio of Net Investment
Income to Average Net
Assets 4.78%* 4.96%* 5.11%* 3.99% _ 2.90% 5.01% 7.05%
</TABLE>
(1) New class of shares established on January 20, 1995.
(2) Designated as the Original Shares class of shares on January 20, 1995.
** For the period from February 1, 1995 (commencement of operations) to
March 31, 1995.
# Not annualized.
* Annualized.
See accompanying notes to financial statements.
18
<PAGE>
(Left Column)
Investment Adviser
HAWAIIAN TRUST COMPANY, LIMITED
Financial Plaza of the Pacific
P.O. Box 3170
Honolulu, Hawaii 96802
Administrator
AQUILA MANAGEMENT CORPORATION
380 Madison Avenue, Suite 2300
New York, New York 10017
Board of Trustees
Lacy B. Herrmann, Chairman
Vernon R. Alden
Arthur K. Carlson
William M. Cole
Thomas W. Courtney
Richard W. Gushman, II
Stanley W. Hong
Theodore T. Mason
Russell K. Okata
Douglas Philpotts
Oswald K. Stender
Thelma Chun-Hoon Zen
Officers
Lacy B. Herrmann, President
William C. Wallace, Vice President
Diana P. Herrmann, Vice President
Charles E. Childs, III, Vice President
John M. Herndon, Vice President
Sherri Foster, Assistant Vice President
Rose F. Marotta, Chief Financial Officer
Richard F. West, Treasurer
Edward M.W. Hines, Secretary
Kenneth L. MacRitchie, Assistant Secretary
Distributor
AQUILA DISTRIBUTORS, INC.
380 Madison Avenue, Suite 2300
New York, New York 10017
Transfer and Shareholder Servicing Agent
ADMINISTRATIVE DATA MANAGEMENT CORP.
10 Woodbridge Center Drive
Woodbridge, New Jersey 07095-1198
Custodian
NATIONAL WESTMINSTER BANK NJ
Two Montgomery Street
Jersey City, New Jersey 07302
Independent Auditors
KPMG PEAT MARWICK LLP
345 Park Avenue
New York, New York 10154
Further information is contained in the Prospectus,
which must precede or accompany this report.
(Right Column)
Semi-Annual
Report
September 30, 1994
THE PACIFIC CAPITAL FUNDS
OF
CASH ASSETS TRUST
Pacific Capital Cash Assets Trust
Pacific Capital Tax-Free
Cash Assets Trust
Pacific Capital U.S. Treasuries
Cash Assets Trust
(Logo of Lion on Braided Rope)
A cash management investment
<PAGE>
