<PAGE> 1
NATIONS
FUNDS
Investments For A Lifetime(SM)
MONEY
MARKET
FUNDS
ANNUAL REPORT FOR THE YEAR ENDED MARCH 31, 1997
<PAGE> 2
<TABLE>
<S> <C>
NOT MAY LOSE VALUE
FDIC-
INSURED NO BANK GUARANTEE
</TABLE>
NATIONS FUNDS DISTRIBUTOR: STEPHENS INC. STEPHENS INC., WHICH IS NOT AFFILIATED
WITH NATIONSBANK, N.A., IS NOT A BANK AND SECURITIES OFFERED BY IT ARE NOT
GUARANTEED BY ANY BANK OR INSURED BY THE FDIC. STEPHENS INC., MEMBER NYSE-SIPC.
NATIONS FUNDS INVESTMENT ADVISER: NATIONSBANC ADVISORS, INC.
NATIONS FUNDS INVESTMENT SUB-ADVISERS: TRADESTREET INVESTMENT ASSOCIATES, INC.
AND GARTMORE GLOBAL PARTNERS.
<PAGE> 3
NATIONS FUNDS
DEAR SHAREHOLDER:
We are pleased to present the Nations Funds annual report for the fiscal year
ended March 31, 1997. Overall, domestic equity markets rewarded investors with
strong returns. In fact, during this period the U.S stock market reached record
levels. More recently, the markets have experienced increasing volatility as
concerns have surfaced about strong economic growth leading to inflation. When
markets experience fluctuations like this, it is often unsettling. Investors
should be cautioned, however, not to confuse short-term volatility with
long-term trends.
The last two years marked a period that most investors (particularly equity
investors) will look back upon with great satisfaction. Domestic equity returns
averaged better than 18% during 1996; and for the last two years, have exceeded
50%(1). Several factors contributed to 1996's favorable market results: 1) The
continued strength in the U.S. economy; 2) No real evidence of inflationary
pressures; 3) U.S. corporations experiencing continued profit growth; and 4)
Record cash inflow into equity mutual funds. Investors should note that returns
on stocks have been exceptional and well above the historical average of
10.7%.(2)
Looking out into 1997, the investment environment continues to read as if it
were being scripted to enhance financial assets -- moderate but persistent
economic growth, low inflation and strong earnings. Although the duration of
this economic expansion is six years and counting, there does not appear to be
anything on the horizon that would move the economy off its current track.
Importantly, after a long period of outperformance by stocks, investors should
pay particular attention to their current allocation relative to their
objectives and risk tolerance. We are expecting that future advances in the
markets will be accompanied by increased volatility and periodic corrections as
the market adjusts to factors such as recent changes in monetary policy. While
we believe that markets will reach significant new highs before the end of the
millennium, markets do not go straight up and there will be periods of decline
along the way.
Thank you for your continued confidence in the Nations Funds family of funds.
Sincerely,
[LOGO] [LOGO]
A. Max Walker Mark H. Williamson
President and Chairman of the Board President, NationsBanc Advisors, Inc.
March 31, 1997
(1) AS MEASURED BY THE S&P 500 INDEX.
(2) IBBOTSON ASSOCIATES, STOCKS, BONDS, BILLS AND INFLATION 1997 YEARBOOK
<PAGE> 4
THE NATIONS FUNDS ADVANTAGE
A family of mutual funds provides investors with a number of advantages,
including the ability to shift investment assets among funds as their financial
objectives or market conditions change. The Nations Funds family of mutual
funds includes a broad array of professionally managed domestic and
international stock, bond and money market funds advised by NationsBanc
Advisors, Inc. The family was designed to accommodate a wide variety of
investment objectives across the risk/reward spectrum.
POTENTIAL RETURN
<TABLE>
<CAPTION>
LONGER TERM
MONEY SHORTER INTERMEDIATE DOMESTIC EQUITY
MARKET MATURITY MATURITY AND GLOBAL BALANCED INCOME
FUNDS BOND FUNDS BOND FUNDS BOND FUNDS FUNDS FUNDS
<S> <C> <C> <C> <C> <C>
* Nations * Nations Short- * Nations * Nations Global * Nations * Nations
Prime Fund Intermediate Strategic Fixed Government Balanced Equity Income
Government Income Fund Income Fund Assets Fund Fund
* Nations Fund
Government * Nations * Nations
Money Market * Nations Intermediate Diversified
Fund Short-Term Municipal Income Fund
Income Fund Bond Fund
* Nations * Nations
Treasury Fund * Nations Short- * Nations Government
Term Municipal State-Specific Securities Fund
* Nations Tax Income Fund Intermediate
Exempt Fund Municipal * Nations
Bond Funds Municipal
Income Fund
* Nations State-
Specific Long-
Term Municipal
Bond Funds
GROWTH & INCOME (ARROW RIGHT)
CURRENT INCOME (ARROW RIGHT)
(ARROW LEFT) STABILITY RISK (VARIABILITY) (ARROW RIGHT)
</TABLE>
For specific information on developing an investment portfolio that will
more closely target your investment objectives, contact your investment
representative or Nations Fund for fund brochures and prospectuses at
(800) 982-2271.
The Nations Funds family also includes Nations Equity Index Fund, which
seeks to match the performance of the S&P 500 before fees and expenses.
2
<PAGE> 5
<TABLE>
<CAPTION>
GROWTH LARGE SMALLER REGION-SPECIFIC
AND INCOME CAPITALIZAITON CAPITALIZATION INTERNATIONAL INTERNATIONAL
FUNDS GROWTH FUNDS GROWTH FUNDS EQUITY FUNDS FUNDS
<S> <C> <C> <C> <C>
* Nations * Nations * Nations * Nations * Nations
Value Fund Disciplined Emerging International Emerging
Equity Fund Growth Fund Equity Fund Markets Fund
* Nations Capital * Nations
Growth Fund Pacific Growth
Fund
AGGRESSIVE GROWTH (ARROW RIGHT)
GROWTH (ARROW RIGHT)
</TABLE>
SPECIALTY FUNDS
MANAGED INDEX FUNDS
Nations Managed SmallCap Index Fund
Nations Managed Index Fund
3
<PAGE> 6
NATIONS FUNDS
Nations Prime Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS MARCH 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL MATURITY VALUE
AMOUNT DATE (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
BANK
OBLIGATIONS --
16.7%
CERTIFICATES OF DEPOSIT --
DOMESTIC -- 1.9%
Bankers Trust Company
of New York:
$ 15,000,000 5.580%................ 10/30/97 $ 14,961,519
20,000,000 5.910%................ 03/12/98 19,994,577
40,000,000 6.000%................ 03/24/98 39,953,316
10,000,000 Mellon Bank
Corporation,
6.030%................ 09/23/97 9,996,099
------------
84,905,511
------------
CERTIFICATES OF DEPOSIT --
YANKEE -- 14.8%
Bank of Tokyo Mitsubishi,
(New York):
30,000,000 5.600%................ 04/16/97 30,000,000
35,000,000 5.570%................ 04/30/97 35,000,000
15,000,000 5.590%................ 05/05/97 15,000,000
30,000,000 5.800%................ 06/30/97 30,000,000
10,000,000 5.560%................ 07/18/97 10,000,000
40,000,000 5.700%................ 09/30/97 40,000,000
Bayerische Landesbank
AG, (New York):
100,000,000 5.6625%+.............. 08/01/97 100,000,000
50,000,000 5.6550%............... 12/19/97 50,000,000
25,000,000 5.7500%............... 12/19/97 25,000,000
50,000,000 Canadian Imperial Bank,
(New York),
5.330%................ 04/30/97 50,000,399
20,000,000 Deutsche Bank,
(New York),
5.860%................ 03/10/98 19,992,808
National Bank of Canada,
(New York):
20,000,000 5.850%................ 02/27/98 20,000,000
20,000,000 5.940%................ 03/06/98 20,000,000
30,000,000 6.030%................ 03/18/98 29,997,244
Sanwa Bank Ltd. of
New York:
50,000,000 5.530%................ 04/14/97 50,000,323
50,000,000 5.510%................ 05/19/97 50,001,316
50,000,000 5.640%................ 07/15/97 50,000,000
20,000,000 5.660%................ 09/11/97 20,000,000
------------
644,992,090
------------
TOTAL BANK OBLIGATIONS
(Cost $729,897,601)............ 729,897,601
============
CORPORATE
OBLIGATIONS --
53.7%
COMMERCIAL PAPER -- 38.1%
30,000,000 AC Acquisition Holding
Company, Discount
note(a)............... 04/28/97 29,880,075
Aetna Services, Inc.:
20,000,000 Discount note......... 04/10/97 19,971,000
20,000,000 Discount note......... 04/11/97 19,967,667
30,000,000 Bankers Trust Company,
Discount note......... 04/15/97 29,937,350
45,417,000 Columbia/HCA Healthcare
Corporation,
Discount note(a)...... 04/01/97 45,417,000
Dynamic Funding
Corporation:
35,936,000 Discount note......... 04/11/97 35,881,098
3,995,000 Discount note......... 04/14/97 3,987,022
23,415,000 Discount note......... 04/15/97 23,364,463
24,748,000 Discount note......... 04/24/97 24,657,086
<CAPTION>
PRINCIPAL MATURITY VALUE
AMOUNT DATE (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
CORPORATE
OBLIGATIONS --
(CONTINUED)
COMMERCIAL PAPER --
(CONTINUED)
Dynamic Funding
Corporation (continued):
Finova Capital
Corporation:
$ 25,000,000 Discount note......... 04/08/97 $ 24,973,993
20,000,000 Discount note......... 04/14/97 19,961,578
17,500,000 Discount note......... 04/17/97 17,458,389
General Motors
Acceptance Corporation:
30,000,000 Discount note......... 06/23/97 29,624,425
25,000,000 Discount note......... 07/09/97 24,626,000
30,000,000 Discount note......... 08/25/97 29,350,300
GTE Corporation:
27,000,000 Discount note......... 04/03/97 26,991,975
31,000,000 Discount note......... 04/08/97 30,967,691
24,000,000 Discount note......... 04/08/97 23,974,940
International
Securitization
Corporation:
13,594,000 Discount note(a)...... 04/10/97 13,575,750
40,000,000 Discount note(a)...... 04/17/97 39,904,356
12,494,000 Discount note(a)...... 04/21/97 12,456,865
50,000,000 Discount note(a)...... 04/24/97 49,830,695
30,000,000 Discount note(a)...... 05/15/97 29,801,267
9,874,000 Discount note(a)...... 05/27/97 9,791,826
20,731,000 Discount note(a)...... 06/23/97 20,462,384
11,911,000 Discount note(a)...... 06/24/97 11,762,033
10,278,000 Discount note(a)...... 08/18/97 10,067,275
Lehman Brothers
Holdings Inc.:
150,000,000 Discount note......... 04/01/97 150,000,000
35,000,000 Discount note......... 04/25/97 34,874,583
22,000,000 Discount note......... 06/06/97 21,780,183
40,000,000 Discount note......... 11/21/97 38,479,000
National Bank of Canada:
35,000,000 Discount note......... 06/02/97 34,650,992
30,000,000 Discount note......... 06/06/97 29,702,725
25,000,000 Discount note......... 07/01/97 24,665,069
25,000,000 Newell Company,
Discount note(a)...... 04/01/97 25,000,000
Nynex Corporation:
17,000,000 Discount note......... 04/04/97 16,992,435
29,000,000 Discount note......... 04/07/97 28,974,190
30,000,000 Discount note......... 04/09/97 29,964,400
12,500,000 Discount note......... 04/29/97 12,448,083
ODC Capital Corporation:
28,500,000 Discount note(b)...... 04/09/97 28,466,117
45,000,000 Discount note(b)...... 04/11/97 44,933,125
Renault Credit
International:
25,000,000 Discount note......... 04/07/97 24,977,667
25,000,000 Discount note......... 04/14/97 24,951,070
8,000,000 SRD Finance Inc.,
(Bank of Tokyo
Mitsubishi, Ltd LOC),
Discount note......... 04/24/97 7,970,509
Sumitomo Corporation
of America:
50,000,000 Discount note......... 04/01/97 50,000,000
23,000,000 Discount note......... 04/15/97 22,951,700
20,000,000 Discount note......... 04/23/97 19,934,000
25,000,000 Discount note......... 05/12/97 24,847,104
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
4
<PAGE> 7
NATIONS FUNDS
Nations Prime Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) MARCH 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL MATURITY VALUE
AMOUNT DATE (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
CORPORATE
OBLIGATIONS --
(CONTINUED)
COMMERCIAL PAPER --
(CONTINUED)
Sumitomo Corporation of
America (continued):
$ 15,000,000 Discount note......... 06/23/97 $ 14,812,212
15,000,000 Discount note......... 07/09/97 14,775,187
15,000,000 Discount note......... 08/11/97 14,704,100
25,000,000 Discount note......... 08/13/97 24,497,500
TI Group Inc.:
10,000,000 Discount note(a)...... 04/15/97 9,979,000
9,000,000 Discount note(a)...... 04/24/97 8,968,950
29,024,000 Towson Town
Center, Inc.,
(Bank of Tokyo
Mitsubishi, Ltd. LOC),
Discount note......... 04/15/97 28,961,357
Tri-Lateral Capital
(USA) Inc.:
17,965,000 Discount note(b)...... 04/21/97 17,909,308
46,200,000 Discount note(b)...... 05/19/97 45,867,360
25,380,000 Discount note(b)...... 06/24/97 25,043,630
Tribune Company:
60,000,000 Discount note(a)...... 04/29/97 59,738,666
35,000,000 Discount note(a)...... 05/02/97 34,829,715
5,000,000 WCP Funding, Inc.,
Discount note(a)...... 04/14/97 4,990,394
------------
1,660,284,834
=============
CORPORATE NOTES -- 15.6%
Bankers Trust Company
of New York:
76,000,000 5.680%+(b)............ 04/01/97+++ 75,989,216
15,000,000 5.680%+(b)............ 04/01/97+++ 14,995,736
Bear Stearns & Company,
Inc.:
50,000,000 5.690%+............... 04/01/97+++ 50,000,000
25,000,000 5.710%+............... 04/01/97+++ 25,000,000
35,000,000 5.488%+............... 04/04/97+++ 35,000,000
Beta Finance Inc.:
25,000,000 5.760%+(b)............ 04/01/97+++ 25,000,000
75,000,000 5.870%+(b)............ 04/01/97+++ 75,000,000
20,000,000 5.800%(b)............. 03/03/98 20,000,000
10,000,000 Chrysler Financial
Corporation,
6.390%................ 10/03/97 10,009,541
25,000,000 CS First Boston,
5.690%+............... 04/01/97+++ 25,000,000
50,000,000 General Motors
Acceptance Corporation,
5.690%+............... 04/01/97+++ 49,995,994
14,000,000 Goldman Sachs Group,
L.P.,
6.100%................ 04/15/98 13,982,220
International Business
Machines Credit
Corporation:
30,000,000 5.720%+............... 04/01/97+++ 30,000,000
35,000,000 5.720%+............... 04/01/97+++ 35,000,000
50,000,000 5.720%+............... 04/01/97+++ 50,000,000
<CAPTION>
PRINCIPAL MATURITY VALUE
AMOUNT DATE (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
CORPORATE
OBLIGATIONS --
(CONTINUED)
CORPORATE NOTES --
(CONTINUED)
Lehman Brothers
Holdings Inc.:
$ 18,530,000 8.3750%............... 04/01/97 $ 18,530,000
50,000,000 5.5375%+.............. 04/08/97+++ 50,000,000
Merrill Lynch &
Company Inc.:
50,000,000 5.670%+............... 04/01/97+++ 50,000,000
25,000,000 5.680%+............... 04/01/97+++ 25,000,000
------------
678,502,707
------------
TOTAL CORPORATE
OBLIGATIONS
(Cost $2,338,787,541).......... 2,338,787,541
=============
GUARANTEED
INVESTMENT
CONTRACTS --
13.1%
Allstate Life Insurance
Company:
25,000,000 5.587%**+............. 06/27/97# 25,000,000
25,000,000 5.587%**+............. 06/27/97# 25,000,000
25,000,000 Anchor National Life
Insurance Company,
5.683%**+............. 06/27/97# 25,000,000
Commonwealth Life
Insurance Company, Inc.:
10,000,000 5.640%**+............. 09/29/97# 10,000,000
62,000,000 5.640%**+............. 09/29/97# 62,000,000
50,000,000 General American Life
Insurance Company,
5.580%**+............. 04/07/97# 50,000,000
60,000,000 Life Insurance Company
of Georgia,
5.663%**+............. 09/29/97# 60,000,000
Life Insurance Company
of Virginia:
50,000,000 5.369%**+............. 04/07/97# 50,000,000
25,000,000 5.392%**+............. 04/07/97# 25,000,000
25,000,000 5.392%**+............. 04/07/97# 25,000,000
100,000,000 New York Life
Insurance Company,
5.652%**+............. 10/06/97+++ 100,000,000
Peoples Security Life
Insurance Company:
20,000,000 5.690%**+............. 12/04/97+++ 20,000,000
20,000,000 5.640%**+............. 09/29/97# 20,000,000
50,000,000 Sun Life Insurance
Company of America,
5.743%**+............. 09/29/97# 50,000,000
25,000,000 Travelers Life
Insurance Company,
5.518%**+............. 05/01/97+++ 25,000,000
------------
TOTAL GUARANTEED
INVESTMENT CONTRACTS
(Cost $572,000,000)............ 572,000,000
============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
5
<PAGE> 8
NATIONS FUNDS
Nations Prime Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) MARCH 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL MATURITY VALUE
AMOUNT DATE (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL BONDS
- -- 4.1%
$ 28,800,000 Illinois (State of),
Student Assistance
Commission, First
National Bank
of Chicago LOC,
5.670%+............... 04/02/97+++ $ 28,800,000
24,800,000 Indiana (State of),
Financing Authority,
Economic Development
Revenue, Qualitech
Steel, National City
Bank, Indiana LOC,
5.660%+............... 04/02/97+++ 24,800,000
24,500,000 Missouri (State of),
Economic Development
Revenue, Export and
Infrastructure Board,
(Biocraft Laboratories
Inc. Project), PNC
Bank LOC,
5.850%+............... 04/02/97+++ 24,500,000
100,000,000 Virginia (State of),
Housing Development
Authority,
5.600%+............... 04/02/97+++ 100,000,000
------------
TOTAL MUNICIPAL BONDS
(Cost $178,100,000)............ 178,100,000
============
U.S. GOVERNMENT
OBLIGATIONS --
7.1%
Federal Home Loan Bank:
50,000,000 5.670%+............... 04/01/97+++ 50,000,000
18,000,000 4.621%++.............. 04/29/97+++ 18,000,000
Student Loan Marketing
Association Floating
Rate Notes:
20,000,000 5.580%+............... 04/01/97+++ 20,000,000
11,600,000 5.600%+............... 04/01/97+++ 11,570,671
12,000,000 5.600%+............... 04/01/97+++ 12,000,000
21,000,000 5.620%+............... 04/01/97+++ 20,990,166
47,500,000 5.620%+............... 04/01/97+++ 47,371,212
70,000,000 5.710%+............... 04/01/97+++ 70,000,000
10,000,000 5.760%+............... 04/01/97+++ 10,000,000
50,000,000 5.790%+............... 04/01/97+++ 50,000,000
------------
TOTAL U.S. GOVERNMENT
OBLIGATIONS
(Cost $309,932,049)............ 309,932,049
============
TIME DEPOSIT --
DOMESTIC --
0.3%
(Cost
$15,000,000)
15,000,000 Societe Generale,
6.000%................ 04/01/97 15,000,000
============
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
REPURCHASE
AGREEMENT --
4.6%
(Cost
$200,000,000)
$200,000,000 Agreement with Morgan (J.P.)
Securities Inc., 6.600%
dated 03/31/97 to be
repurchased at $200,036,667 on
04/01/97, collateralized
by $204,000,822
Qualified First Tier
Money Market
Instruments,
5.910% -- 6.050% due
06/20/97 -- 09/18/97......... $200,000,000
============
<CAPTION>
SHARES
- -----------
<C> <S> <C>
MONEY MARKET
FUNDS -- 0.3%
10,077,000 AIM Liquid Asset Portfolio..... 10,077,000
106,000 AIM Prime Fund................. 106,000
1,820,000 Dreyfus Cash Management Plus
Fund........................... 1,820,000
39,000 Fidelity Institutional
Cash Portfolio................. 39,000
TOTAL MONEY MARKET FUNDS
(Cost $12,042,000)............. 12,042,000
============
TOTAL INVESTMENTS
(Cost $4,355,759,191*).............. 99.9% 4,355,759,191
OTHER ASSETS AND
LIABILITIES (NET)................... 0.1 3,377,128
------------
----
NET ASSETS.......................... 100.0% $4,359,136,319
===== ==============
</TABLE>
- ---------------
* Aggregate cost for Federal tax purposes.
** Restricted security (Note 5).
+ Floating/variable rate note. The interest rate shown reflects the rate in
effect at March 31, 1997.
++ Variable rate security. The interest rate shown is tied to the Cost of Funds
Index and resets on a delayed basis.
+++ Reset date. Interest rates reset either daily, weekly, monthly, quarterly or
semi-annually.
# Security subject to a demand feature which allows the Fund to put the
security back to the issuer from 7 to 180 calendar days.
(a) Securities are not registered under the Securities Act of 1933. These
securities may be resold in transactions exempt from registration to
qualified institutional buyers.
(b) Security exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be resold in transactions exempt from
registration to qualified institutional buyers.
ABBREVIATION:
LOC Letter of Credit
SEE NOTES TO FINANCIAL STATEMENTS.
6
<PAGE> 9
NATIONS FUNDS
Nations Government Money Market Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS MARCH 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL MATURITY VALUE
AMOUNT DATE (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
U.S.
GOVERNMENT
AGENCY
OBLIGATIONS --
95.9%
FEDERAL FARM CREDIT BANK -- 11.8%
$ 3,350,000 Discount note.......... 04/01/97 $ 3,350,000
6,500,000 Discount note.......... 04/04/97 6,497,156
4,800,000 Discount note.......... 04/09/97 4,794,400
8,000,000 Discount note.......... 04/15/97 7,983,636
8,000,000 Discount note.......... 04/17/97 7,981,476
8,000,000 Discount note.......... 04/22/97 7,975,593
6,000,000 Discount note.......... 07/21/97 5,902,135
------------
44,484,396
------------
FEDERAL FARM CREDIT BANK
FLOATING RATE NOTES -- 10.7%
20,000,000 5.510%+................ 04/01/97+++ 19,997,042
20,000,000 5.510%+................ 04/01/97+++ 19,998,992
------------
39,996,034
------------
FEDERAL FARM CREDIT BANK
NOTES -- 6.7%
15,000,000 5.600%................. 06/03/97 14,996,375
10,000,000 5.840%................. 06/18/97 9,996,729
------------
24,993,104
------------
FEDERAL HOME LOAN
BANK -- 19.4%
39,945,000 Discount note.......... 04/01/97 39,945,000
10,000,000 Discount note.......... 04/10/97 9,986,950
5,000,000 Discount note.......... 05/08/97 4,973,021
5,000,000 Discount note.......... 05/29/97 4,957,789
8,000,000 Discount note.......... 07/14/97 7,878,204
5,000,000 Discount note.......... 08/06/97 4,901,751
------------
72,642,715
------------
FEDERAL HOME LOAN BANK
FLOATING RATE NOTES -- 8.5%
25,000,000 5.670%+................ 04/01/97+++ 25,000,000
7,000,000 4.621%++............... 04/29/97+++ 7,000,000
------------
32,000,000
------------
FEDERAL HOME LOAN BANK
NOTES -- 8.2%
8,000,000 5.850%................. 11/06/97 8,000,000
8,000,000 5.625%................. 12/26/97 8,000,000
8,000,000 5.675%................. 02/12/98 7,987,512
6,900,000 5.875%................. 02/12/98 6,900,000
------------
30,887,512
------------
<CAPTION>
PRINCIPAL MATURITY VALUE
AMOUNT DATE (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
U.S.
GOVERNMENT
AGENCY
OBLIGATIONS --
(CONTINUED)
STUDENT LOAN MARKETING
ASSOCIATION FLOATING
RATE NOTES -- 27.9%
$25,000,000 5.550%+................ 04/01/97+++ $ 24,997,160
25,000,000 5.580%+................ 04/01/97+++ 25,000,000
14,800,000 5.600%+................ 04/01/97+++ 14,800,000
20,000,000 5.710%+................ 04/01/97+++ 19,999,915
20,000,000 5.790%+................ 04/01/97+++ 20,000,000
------------
104,797,075
------------
STUDENT LOAN MARKETING
ASSOCIATION
STRUCTURED NOTE -- 2.7%
10,000,000 5.870%................. 06/30/97 10,003,494
------------
TOTAL U.S. GOVERNMENT
AGENCY OBLIGATIONS
(Cost $359,804,330).............. 359,804,330
===========
<CAPTION>
SHARES
- ----------
<C> <S> <C>
MONEY MARKET FUND -- 3.5%
(Cost $13,228,500)
13,228,500 Dreyfus Treasury Prime Cash
Management Fund................ 13,228,500
-----------
TOTAL INVESTMENTS
(Cost $373,032,830*)............... 99.4% 373,032,830
OTHER ASSETS AND
LIABILITIES (NET).................. 0.6 2,280,880
---- ------------
NET ASSETS........................... 100.0% $375,313,710
===== ============
</TABLE>
- ---------------
* Aggregate cost for Federal tax purposes.
+ Variable rate security. The interest rate shown reflects the rate in effect
at March 31, 1997.
++ Variable rate security. Interest rate shown is tied to the Cost of Funds
Index and resets on a delayed basis.
+++ Reset date. Interest rates reset either daily, weekly or monthly.
SEE NOTES TO FINANCIAL STATEMENTS.
7
<PAGE> 10
NATIONS FUNDS
Nations Treasury Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS MARCH 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL MATURITY VALUE
AMOUNT DATE (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
U.S. TREASURY
OBLIGATIONS --
15.8%
U.S. TREASURY BILLS -- 8.6%
$ 20,000,000 Discount note#.......... 04/03/97 $ 19,994,111
35,000,000 Discount note#.......... 04/10/97 34,955,156
50,000,000 Discount note#.......... 05/01/97 49,777,708
30,000,000 Discount note#.......... 08/21/97 29,346,800
25,000,000 Discount note#.......... 10/16/97 24,264,031
25,000,000 Discount note#.......... 11/13/97 24,176,041
50,000,000 Discount note#.......... 01/08/98 47,924,167
40,000,000 Discount note#.......... 02/05/98 38,167,556
------------
268,605,570
------------
U.S. TREASURY NOTES -- 7.2%
65,000,000 6.500%#................. 04/30/97 65,037,745
20,000,000 6.125%#................. 05/31/97 20,012,316
50,000,000 5.875%#................. 07/31/97 50,090,513
25,000,000 5.750%#................. 09/30/97 25,006,295
40,000,000 5.625%#................. 10/31/97 40,008,845
25,000,000 6.125%.................. 03/31/98 25,062,238
------------
225,217,952
------------
TOTAL U.S. TREASURY OBLIGATIONS
(Cost $493,823,522)............... 493,823,522
===========
<CAPTION>
REPURCHASE
AGREEMENTS --
96.5%
<C> <S> <C>
REPURCHASE AGREEMENTS --
FIXED RATE -- 93.3%
50,000,000 Agreement with Bankers Trust N.Y.
Corporation, 6.000% dated
03/31/97 to be repurchased at
$50,008,333 on 04/01/97
collateralized by $50,000,462
U.S. Treasury Notes, 5.625% --
7.750% due 01/31/00 --
02/15/05...................... 50,000,000
720,000,000 Agreement with Bankers Trust N.Y.
Corporation, 6.500% dated
03/31/97 to be repurchased at
$720,130,000 on 04/01/97
collateralized by: $40,391,422
U.S. Treasury Bills, due
04/24/97 -- 10/16/97;
$370,423,295 U.S. Treasury
Bonds, 6.500% -- 12.750% due
11/15/10 -- 02/15/27;
$323,879,487 U.S. Treasury
Notes, 5.125% -- 8.000% due
09/30/97 -- 02/15/07........... 720,000,000
150,000,000 Agreement with BZW Securities
Corporation, 6.400% dated
03/31/97 to be repurchased at
$150,026,667 on 04/01/97
collateralized by: $33,605,183
U.S. Treasury Bill due
07/03/97; $119,395,558 U.S.
Treasury Notes, 5.875% -- 6.625%
due 05/15/97 -- 03/31/02....... 150,000,000
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
REPURCHASE
AGREEMENTS --
(CONTINUED)
REPURCHASE AGREEMENTS -- FIXED
RATE -- (CONTINUED)
$471,921,000 Agreement with CS First Boston
Corporation. Interest is
payable monthly. The agreement
is terminable by the Fund
daily. The final maturity date
of the agreement is 07/01/97
collateralized by: $40,945,854
U.S. Treasury Strips, Principal
Only, due 08/15/98 -- 02/15/25;
$442,679,429 U.S. Treasury
Strips, Interest Only, due
08/15/97 -- 02/15/23##......... $ 471,921,000
20,000,000 Agreement with Dean Witter,
Reynolds, Inc., 4.750% dated
03/31/97 to be repurchased at
$20,002,639 on 04/01/97
collateralized by: $8,861,977
U.S. Treasury Bills due
05/01/97 -- 02/05/98;
$11,538,943 U.S. Treasury
Notes, 4.750% -- 8.750% due
05/15/98 -- 08/15/05........... 20,000,000
150,000,000 Agreement with Dresdner Bank
Inc., 6.320% dated 03/31/97 to
be repurchased at $150,026,333
on 04/01/97 collateralized by
$153,002,738 U.S. Treasury
Notes, 4.750% -- 9.250% due
11/15/97 -- 11/15/98........... 150,000,000
150,000,000 Agreement with First Union
Corporation, 6.400% dated
03/31/97 to be repurchased at
$150,026,667 on 04/01/97
collateralized by: $21,515,592
U.S. Treasury Bills due
04/03/97 -- 02/05/98;
$9,359,610 U.S. Treasury Bonds,
6.250% -- 10.625% due
08/15/15 -- 08/15/23;
$119,396,890 U.S. Treasury
Notes, 5.250% -- 7.250% due
12/31/97 -- 08/15/03........... 150,000,000
150,000,000 Agreement with Goldman, Sachs &
Company, 6.650% dated 03/31/97
to be repurchased at
$150,027,708 on 04/01/97
collateralized by $153,033,010
GNMA, 6.500% -- 7.125% due
08/20/23 -- 10/20/26........... 150,000,000
50,000,000 Agreement with HSBC Securities,
6.250% dated 03/31/97 to be
repurchased at $50,008,681 on
04/01/97 collateralized by
$51,001,141 GNMA, 6.500% --
9.000% due 09/15/09 --
03/20/27....................... 50,000,000
100,000,000 Agreement with HSBC Securities,
6.650% dated 03/31/97 to be
repurchased at $100,018,472 on
04/01/97 collateralized by:
$44,881,983 GNMA, 5.000% --
13.250% due 08/20/16 --
10/20/26; $57,122,892 U.S.
Treasury Bonds, 8.375% --
13.250% due 08/15/05 --
08/15/14....................... 100,000,000
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
8
<PAGE> 11
NATIONS FUNDS
Nations Treasury Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) MARCH 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
REPURCHASE
AGREEMENTS --
(CONTINUED)
REPURCHASE AGREEMENTS -- FIXED
RATE -- (CONTINUED)
$150,000,000 Agreement with Lehman Brothers
Inc., 6.450% dated 03/31/97 to
be repurchased at $150,026,875
on 04/01/97 collateralized by
$152,953,072 U.S. Treasury
Notes, 6.250% -- 7.500% due
02/28/02 -- 05/15/04........... $ 150,000,000
150,000,000 Agreement with Merrill Lynch
Securities, 6.500% dated
03/31/97 to be repurchased at
$150,027,083 on 04/01/97
collateralized by $153,000,273
GNMA, 5.500% -- 7.125% due
12/20/17 -- 05/20/26........... 150,000,000
150,000,000 Agreement with Morgan (J.P.)
Securities Inc., 6.350% dated
03/31/97 to be repurchased at
$150,026,458 on 04/01/97
collateralized by $153,000,659
U.S. Treasury Note, 3.375% due
01/15/07....................... 150,000,000
150,000,000 Agreement with Morgan Stanley
Group Inc., 6.500% dated
03/31/97 to be repurchased at
$150,027,083 on 04/01/97
collateralized by $146,760,115
GNMA, 5.500% -- 8.000% due
09/15/25 -- 11/20/26........... 150,000,000
150,000,000 Agreement with Smith Barney,
Inc., 6.580% dated 03/31/97 to
be repurchased at $150,027,417
on 04/01/97 collateralized by:
$80,627,195 GNMA, 7.000% --
9.000% due 01/01/00 -- 03/15/27;
$18,131,330 U.S. Treasury Bond,
11.625% due 11/15/04;
$7,176,875 U.S. Treasury Note,
5.875% due 01/31/99;
$32,550,339 U.S. Treasury
Strips, Interest Only, due
11/15/14 -- 02/15/19;
$14,514,278 U.S. Treasury
Strips, Principal Only, due
02/15/99....................... 150,000,000
150,000,000 Agreement with UBS Securities,
Inc., 6.500% dated 03/31/97 to
be repurchased at $150,027,083
on 04/01/97 collateralized by
$153,000,328 GNMA, 6.500% --
7.125% due 11/20/24 --
10/20/25....................... 150,000,000
--------------
2,911,921,000
--------------
REPURCHASE AGREEMENTS --
TERM -- 3.2%
100,000,000 Agreement with CIBC Wood Gundy
Securities Corporation, 5.300%,
with a final maturity date of
04/01/97. Interest receivable
as of March 31, 1997 was
$191,389, collateralized by
$102,004,466 U.S. Treasury
Notes, 5.875% -- 7.250% due
02/15/98 -- 06/30/98........... 100,000,000
--------------
TOTAL REPURCHASE AGREEMENTS
(Cost $3,011,921,000).......... 3,011,921,000
==============
<CAPTION>
VALUE
SHARES (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
MONEY MARKET
FUNDS -- 3.3%
40,782,000 AIM Treasury Fund................ $ 40,782,000
39,399,000 Dreyfus Treasury Cash Management
Fund........................... 39,399,000
23,225,000 Fidelity Institutional Cash
Portfolio...................... 23,225,000
--------------
TOTAL MONEY
MARKET FUNDS
(Cost $103,406,000).............. 103,406,000
===========
TOTAL INVESTMENTS
(Cost $3,609,150,522*).............. 115.6% 3,609,150,522
OTHER ASSETS AND
LIABILITIES (NET)................... (15.6) (485,708,774)
------ --------------
NET ASSETS............................ 100.0% $3,123,441,748
====== ==============
</TABLE>
- ---------------
* Aggregate cost for Federal tax purposes.
# Denotes security subject to repurchase under reverse repurchase agreement as
of March 31, 1997 (Note 1).
## Securities segregated as collateral for reverse repurchase agreement.
ABBREVIATION:
GNMA Government National Mortgage Association
SEE NOTES TO FINANCIAL STATEMENTS.
9
<PAGE> 12
NATIONS FUNDS
Nations Tax Exempt Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS MARCH 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL
BONDS AND
NOTES --
99.8%
ALABAMA -- 4.1%
Alabama (State of), Housing
Finance Authority, Multi-family
Housing,
AmSouth Bank N.A., Birmingham
LOC:
$ 6,200,000 (Ski Lodge III), Series A,
3.450% 03/01/15+............... $ 6,200,000
6,000,000 (Turtle Lake Project), Series F,
3.550% 09/01/23+............... 6,000,000
4,300,000 Alabama (State of), Private
Colleges and Universities
Facilities Authority Revenue,
Series A, FGIC Insured,
Southtrust Bank SBPA,
3.400% 07/01/05+............... 4,300,000
1,650,000 Birmingham, Alabama, Industrial
Development Board, (Avondale --
Phase III), AmSouth Bank N.A.,
Birmingham LOC,
3.750% 06/01/00+............... 1,650,000
27,000,000 Birmingham, Alabama, Medical
Clinic Board Revenue,
(University of Alabama Health
Services), Morgan Guaranty
Trust Company, New York LOC,
3.950% 12/01/26++.............. 27,000,000
3,475,000 Gadsden, Alabama, Industrial
Development Board, Industrial
Development Revenue, (Keystone
Foods Corporation Project),
AMT, Bank of Scotland LOC,
3.750% 05/01/04+(a)............ 3,475,000
7,200,000 Homewood, Alabama, Educational
Building Authority Revenue,
Educational Facilities,
(Samford University), Bank of
Nova Scotia LOC,
3.850% 12/01/21++.............. 7,200,000
4,000,000 Mobile, Alabama, Industrial
Development Board, (IB Chemical
Company Project), Industrial
Bank of Japan Ltd. LOC,
3.650% 12/01/97+(a)............ 4,000,000
2,000,000 Opelika, Alabama, Industrial
Development Board, (Flowers
Baking Company Project),
SunTrust Bank LOC,
3.500% 12/01/99+(a)............ 2,000,000
5,700,000 Stevenson, Alabama, Industrial
Development Board,
Environmental Improvement
Revenue, (Mead Corporation
Project), AMT, Societe Generale
LOC,
3.900% 01/01/31++.............. 5,700,000
--------------
67,525,000
--------------
ARIZONA -- 6.0%
Apache (County of), Arizona,
Industrial Development
Authority, PCR, (Tuscon
Electric Power):
5,500,000 Series 83A, Barclays Bank Plc
LOC,
3.500% 12/15/18+............... 5,500,000
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL
BONDS AND
NOTES --
(CONTINUED)
ARIZONA -- (CONTINUED)
Apache (County of), Arizona,
Industrial Development Authority,
PCR, (Tuscon Electric
Power) (continued):
$29,300,000 Series A, Chase Bank LOC,
3.500% 06/15/20+............... $ 29,300,000
5,400,000 Goodyear, Arizona, Industrial
Development Authority, (Walle
Corporation Project), AMT, PNC
Bank LOC,
3.750% 05/01/15+(a)............ 5,400,000
1,500,000 Maricopa (County of), Arizona,
PCR, (Arizona Public Service
Company), Series F, Bank of
America LOC,
3.850% 05/01/29++.............. 1,500,000
Maricopa (County of), Arizona,
Unified School District:
10,000,000 No. 210 Phoenix, Tax Anticipation
Notes, Series A,
4.400% 07/31/97................ 10,012,778
5,000,000 No. 213 Tempe, Tax Anticipation
Notes, Series A,
4.400% 07/31/97................ 5,006,389
Pima (County of), Arizona,
Industrial Development
Authority, (Tuscon Electric),
Series A:
33,800,000 Bank of America LOC,
3.450% 07/01/22+............... 33,800,000
7,700,000 Societe Generale LOC,
3.500% 06/15/22+............... 7,700,000
--------------
98,219,167
--------------
ARKANSAS -- 0.2%
3,250,000 Lowell, Arkansas, Industrial
Development Revenue, (Little
Rock Newspapers Inc. Project),
AMT, Bank of New York LOC,
3.550% 06/01/31+(a)............ 3,250,000
--------------
CALIFORNIA -- 1.9%
Los Angeles, California, Regional
Airports Improvement
Corporation, (Los Angeles
International Airport), Societe
Generale LOC:
3,900,000 Facilities Sublease Revenue,
3.800% 12/01/25++.............. 3,900,000
4,500,000 Terminal Facilities Completion
Revenue,
3.900% 12/01/25++.............. 4,500,000
5,000,000 San Diego, California, Tax
Anticipation Notes, Series A,
4.500% 07/02/97................ 5,009,099
16,900,000 Student Education Loan Marketing
Corporation, Student Loan
Revenue, Series A, Dresdner
Bank LOC,
3.450% 11/01/02+............... 16,900,000
--------------
30,309,099
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
10
<PAGE> 13
NATIONS FUNDS
Nations Tax Exempt Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) MARCH 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL
BONDS AND
NOTES --
(CONTINUED)
COLORADO -- 4.1%
$13,000,000 Colorado (State of), Housing
Finance Authority, Multi-family
Housing Revenue, (Grants
Plaza), Series A, Bankers Trust
Company LOC,
3.525% 11/01/09+............... $ 13,000,000
2,000,000 Colorado (State of), Post
Secondary Educational
Authority, Economic Development
Revenue, Bank One LOC,
3.550% 06/01/11+(a)............ 2,000,000
Denver (City & County of),
Colorado, Airport Revenue, AMT:
3,500,000 Series F, Bank of Montreal LOC,
3.600% 11/15/25+............... 3,500,000
5,000,000 Series G, Credit Local de France
LOC,
3.600% 11/15/25+............... 5,000,000
2,205,000 El Paso (County of), Colorado,
Multi-family Housing Revenue,
(Briarglen Apartments Project),
General Electric Capital
Corporation Guaranty LOC,
3.450% 12/01/24+(a)............ 2,205,000
1,440,000 Englewood, Colorado, Industrial
Development Revenue, (Swedish
Mob Project), Bank of Tokyo;
Mitsubishi Bank Ltd. LOC,
3.550% 12/01/10+............... 1,440,000
32,000,000 Moffat (County of), Colorado,
PCR, CFC Guarantee, AMBAC
Insured, Societe Generale SBPA,
3.400% 07/01/20+............... 32,000,000
Pitkin (County of), Colorado,
Industrial Development Revenue,
(Aspen Skiing Company Project),
First National Bank of Chicago
LOC:
3,000,000 Series A,
4.000% 04/01/16++(a)........... 3,000,000
5,400,000 Series B, AMT,
4.000% 04/01/14++(a)........... 5,400,000
--------------
67,545,000
--------------
CONNECTICUT -- 0.1%
2,100,000 Connecticut (State of), Housing
Finance Authority, AMT,
3.650% 04/10/97................ 2,100,000
--------------
DELAWARE -- 1.5%
24,000,000 Delaware (State of), Economic
Development Authority Revenue,
Hospital Billing, Series C,
MBIA Insured, Morgan Stanley
Group, Inc. SBPA,
3.500% 12/01/15+............... 24,000,000
--------------
DISTRICT OF COLUMBIA -- 0.8%
4,600,000 District of Columbia, GO,
(Georgetown University), Series
B, Bayerische Landesbank LOC,
3.400% 04/01/04+............... 4,600,000
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL
BONDS AND
NOTES --
(CONTINUED)
DISTRICT OF COLUMBIA -- (CONTINUED)
$ 4,900,000 District of Columbia, GO, Series
B-1, Union Bank of Switzerland
LOC,
3.900% 06/01/03++(a)........... $ 4,900,000
2,900,000 District of Columbia, Hospital
Revenue, (Columbia Women's
Hospital), Series A, Bank of
Tokyo; Mitsubishi Bank Ltd.
LOC,
3.650% 07/01/20+............... 2,900,000
--------------
12,400,000
--------------
FLORIDA -- 8.3%
12,810,000 Broward (County of), Florida,
Housing Finance Authority,
Multi-family Housing Revenue,
(Fishermans Project),
Continental Casualty Surety
Bond,
3.650% 11/01/07+............... 12,810,000
Dade (County of), Florida,
Industrial Development
Authority:
2,200,000 (Dolphins Stadium Project),
Series C, Societe Generale LOC,
3.450% 01/01/16+(a)............ 2,200,000
4,220,000 (Phase II Furniture Corporation
Project), AMT, SunTrust Bank
LOC,
3.550% 11/01/14+(a)............ 4,220,000
14,998,500 Florida (State of), Board of
Education, Capital Outlay,
BTP-179, Bankers Trust Company
SBPA,
3.550% 06/01/01+(a)............ 14,998,500
Florida (State of), Housing
Finance Agency, Multi-family
Housing Revenue:
14,800,000 (Clear Lake Project), Series D,
Continental Casualty Surety
Bond,
3.650% 01/01/34+............... 14,800,000
3,100,000 (Lake of North Dale Project),
Southtrust Bank LOC,
3.550% 06/01/07+............... 3,100,000
5,000,000 (Lakeside Project), Series B,
Bankers Trust Company LOC,
3.525% 08/01/06+(a)............ 5,000,000
7,000,000 (Woodlands Project), Citibank
LOC,
3.450% 12/01/07+............... 7,000,000
7,000,000 Indian River (County of),
Florida, Hospital Revenue,
Kredietbank LOC,
3.450% 10/01/15+............... 7,000,000
3,600,000 Jacksonville, Florida, Health
Facilities Authority, Hospital
Revenue, (Baptist Health
Properties Project), Barnett
Bank, Florida LOC,
3.750% 06/01/20++.............. 3,600,000
7,000,000 Jacksonville, Florida, Hospital
Revenue, (Baptist Medical
Center Project), First Union
National Bank, Charlotte LOC,
3.500% 06/01/09+............... 7,000,000
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
11
<PAGE> 14
NATIONS FUNDS
Nations Tax Exempt Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) MARCH 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL
BONDS AND
NOTES --
(CONTINUED)
FLORIDA -- (CONTINUED)
$ 4,800,000 Jacksonville, Florida, Parking
Systems Revenue, (University of
North Florida Foundation Inc.,
Project), SunTrust Bank LOC,
3.450% 05/01/22+(a)............ $ 4,800,000
2,500,000 Key West, Florida, Community
Redevelopment Agency Revenue,
(Pier House Joint Venture), PNC
Bank, Ohio LOC,
3.600% 01/01/98+(a)............ 2,500,000
11,350,000 Orange (County of), Florida,
Health Facilities Authority
Revenue, (SHCC Services Inc.
Project), SunTrust Bank LOC,
3.500% 12/01/23+(a)............ 11,350,000
5,000,000 Orange (County of), Florida,
Housing Finance Agency, Series
B, AMT,
3.650% 04/01/97................ 5,000,000
3,250,000 St. Lucie (County of), Florida,
Industrial Development
Authority, (Florida
Convalescent Centers Project),
Series A, Toronto Dominion Bank
LOC,
3.500% 01/01/11+++............. 3,250,000
St. Lucie (County of), Florida,
PCR, (Florida Power and Light
Company):
8,025,000 3.500% 06/05/97.................. 8,025,000
7,000,000 3.500% 06/05/97.................. 7,000,000
3,800,000 4.000% 03/01/27++................ 3,800,000
4,200,000 University Athletic Association
Inc., Capital Improvement
Revenue, (University of Florida
Stadium Project), SunTrust Bank
LOC,
3.700% 02/01/20++.............. 4,200,000
4,775,000 University of Northern Florida,
Capital Improvement Revenue,
First Union National Bank of
North Carolina LOC,
3.450% 11/01/27+(a)............ 4,775,000
--------------
136,428,500
--------------
GEORGIA -- 5.2%
10,000,000 Albany-Dougherty, Georgia,
Payroll Development Authority,
PCR, (Philip Morris Company
Inc. Project),
3.500% 10/01/05+(a)............ 10,000,000
6,385,000 Clayton (County of), Georgia,
Housing Authority, Multi-family
Housing Revenue, (Chateau
Forest Apartments), Series E,
Barclays Bank Plc LOC,
3.400% 01/01/21+............... 6,385,000
2,655,000 Cobb (County of), Georgia,
Industrial Development
Authority Revenue, (Datagraphic
Inc. Project), AMT, Southtrust
Bank LOC,
3.550% 05/01/05+............... 2,655,000
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL
BONDS AND
NOTES --
(CONTINUED)
GEORGIA -- (CONTINUED)
$ 3,800,000 Cobb (County of), Georgia,
Residential Care Facilities for
the Elderly Authority, (North
Georgia Presbyterian Homes,
Inc. Project), SunTrust Bank
LOC,
3.500% 08/01/18+(a)............ $ 3,800,000
4,000,000 Columbia (County of), Georgia,
Residential Care Facilities for
the Elderly Authority, (Augusta
Residential Center on Aging),
SunTrust Bank LOC,
3.500% 01/01/21+(a)............ 4,000,000
2,250,000 Columbus, Georgia, Housing
Authority, Multi-family Housing
Revenue, (Quail Ridge Project),
Columbus Bank & Trust Company
LOC,
3.750% 02/01/05+............... 2,250,000
3,755,000 Columbus, Georgia, Industrial
Development Revenue, (Parisian
Inc. Project), Columbus Bank &
Trust Company LOC,
3.800% 04/01/07+(a)............ 3,755,000
3,960,000 Dekalb (County of), Georgia,
Hospital Authority, Revenue
Anticipation Certificates,
(Dekalb Medical Center
Project), SunTrust Bank LOC,
3.500% 09/01/09+(a)............ 3,960,000
Dekalb (County of), Georgia,
Housing Authority, Multi-family
Housing Revenue:
2,800,000 (Camden Brook Project), FNMA
Insured,
3.450% 06/15/25+............... 2,800,000
5,430,000 (Haystack Apartment Projects),
AMT, General Electric Capital
Corporation LOC,
3.550% 12/01/20+(a)............ 5,430,000
6,875,000 (Stone Mill Run Apartments
Project), Series A, AMT, First
Tennessee Bank LOC,
3.600% 08/01/27+............... 6,875,000
5,000,000 (Terrace Club Project), Series B,
Southtrust Bank LOC,
3.550% 11/01/15+............... 5,000,000
3,000,000 Fulton (County of), Georgia,
Development Authority Revenue,
(Spelman College Project),
SunTrust Bank LOC,
3.500% 06/01/16+............... 3,000,000
2,400,000 Greene (County of), Georgia,
Industrial Development
Authority Revenue, (Chipman-Union
Inc. Project),
Series A, AMT, SunTrust Bank
LOC,
3.550% 03/01/05+(a)............ 2,400,000
3,700,000 Gwinnett (County of), Georgia,
Industrial Development Revenue,
(United Stationers Company
Project), PNC Bank LOC,
3.600% 12/31/02+(a)............ 3,700,000
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
12
<PAGE> 15
NATIONS FUNDS
Nations Tax Exempt Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) MARCH 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL
BONDS AND
NOTES --
(CONTINUED)
GEORGIA -- (CONTINUED)
$ 1,400,000 Hapeville, Georgia, Development
Authority, Industrial
Development Revenue, Hapeville
Hotel Ltd., Deutsche Bank LOC,
4.000% 11/01/15++.............. $ 1,400,000
3,000,000 Henry (County of), Georgia,
Development Authority Revenue,
(Georgia-Pacific Corporation
Project), SunTrust Bank LOC,
3.500% 05/01/04+(a)............ 3,000,000
5,000,000 Smyrna, Georgia, Multi-family
Housing Authority Revenue,
(Post VY Project), FNMA
Collateralized,
3.450% 06/01/25+............... 5,000,000
4,000,000 Tallapoosa, Georgia, Development
Authority Revenue, (U.S. Canada
Company Project), Bank of
Montreal; Harris Trust &
Savings Bank LOC,
3.500% 02/01/15+(a)............ 4,000,000
5,000,000 Thomaston-Upson (County of),
Georgia, Industrial Development
Revenue, (Quad/Thomaston
Project), First Union National
Bank, Charlotte LOC,
3.500% 04/01/00+(a)............ 5,000,000
--------------
84,410,000
--------------
HAWAII -- 0.5%
8,300,000 Hawaii (State of), Housing
Finance and Development
Corporation, Rental Housing
System Revenue Bonds, Series
89A, Banque Nationale de Paris
LOC,
3.550% 07/01/24+............... 8,300,000
--------------
IDAHO -- 0.6%
9,000,000 Idaho (State of), Tax
Anticipation Notes, GO,
4.500% 06/30/97................ 9,012,308
--------------
ILLINOIS -- 15.6%
6,275,000 Chicago, Illinois, Industrial
Development Revenue, (Eli's
Chicago's Finest Inc.), AMT,
First Bank LOC,
3.650% 11/01/26+(a)............ 6,275,000
Chicago, Illinois, O'Hare
International Airport, American
Airlines Inc.:
9,000,000 Series A, Westdeutsche Landesbank
LOC,
3.850% 12/01/17++.............. 9,000,000
12,200,000 Series C, Royal Bank of Canada
LOC,
3.850% 12/01/17++.............. 12,200,000
6,800,000 Series D, Royal Bank of Canada
LOC,
3.850% 12/01/17++.............. 6,800,000
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
- ------------------------------------------------------------------
<C> <S> <C>
MUNICIPAL
BONDS AND
NOTES --
(CONTINUED)
ILLINOIS -- (CONTINUED)
$ 3,300,000 Chicago, Illinois, O'Hare
International Airport, Second
Lien, Series C, Societe
Generale LOC,
3.500% 01/01/18+............... $ 3,300,000
Illinois (State of), Development
Finance Authority:
3,920,000 (Chicago Academy of Sciences),
American National Bank & Trust
Company LOC,
3.500% 01/01/31+............... 3,920,000
26,100,000 (Chicago Symphony Orchestra),
Northern Trust Company LOC,
3.500% 12/01/28+............... 26,100,000
18,000,000 (Chicago Symphony Project), Bank
of America LOC,
3.500% 06/01/31+(a)............ 18,000,000
6,500,000 (Illinois Power Company Project),
Canadian Imperial Bank of
Commerce LOC,
3.600% 09/12/97................ 6,500,000
21,500,000 (Lyric Opera Chicago Project),
Northern Trust Company; NBD
Bank N.A.; Harris Trust &
Savings Bank; and Caisse
National de Credit Agricoli
LOC,
3.500% 12/01/28+............... 21,500,000
5,000,000 (Presbyterian Home Lake), Series
A, ABN-AMRO Bank LOC,
3.500% 09/01/31+............... 5,000,000
9,000,000 (Roosevelt University Project),
American National Bank & Trust
Company LOC,
3.500% 04/01/25+............... 9,000,000
5,900,000 (YMCA of Metropolitan Chicago
Project), Series A, Harris
Trust & Savings Bank LOC,
3.500% 06/01/26+............... 5,900,000
2,000,000 Illinois (State of), Development
Finance Authority, Economic
Development Revenue, (Addison
450 LP Project), AMT, American
National Bank & Trust Company
LOC,
3.600% 12/01/09+............... 2,000,000
Illinois (State of), Development
Finance Authority, Industrial
Development Revenue:
2,000,000 (MTI Project), AMT, Industrial
Bank of Japan Ltd., NY LOC,
3.800% 01/01/09+(a)............ 2,000,000
3,200,000 (Randolph Pickle Corporation),
AMT, American National Bank &
Trust Company LOC,
3.700% 06/01/12+............... 3,200,000
2,415,000 (Xavier University), American
National Bank & Trust Company
LOC,
3.500% 10/01/12+............... 2,415,000
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
13
<PAGE> 16
NATIONS FUNDS
Nations Tax Exempt Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) MARCH 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
------------------------------------------------------------
<S> <C>
MUNICIPAL BONDS AND NOTES -- (CONTINUED)
ILLINOIS -- (CONTINUED)
Illinois (State of), Development
Finance Authority, PCR:
$ 3,700,000 (Diamond Star Meters Project),
Bank of Tokyo; Mitsubishi Bank
Ltd. LOC,
3.950% 12/01/08++(a)........... $ 3,700,000
7,100,000 (Edison Company Project), Series
C, ABN-AMRO Bank LOC,
3.450% 03/01/09+............... 7,100,000
9,300,000 (Illinois Power Company Project),
AMT, Series B, Bank of Tokyo;
Mitsubishi Bank Ltd. LOC,
3.650% 03/01/17+............... 9,300,000
Illinois (State of), Educational
Facilities Revenue:
6,400,000 (Chicago Historical Society),
Northern Trust Company LOC,
3.500% 12/01/25+(a)............ 6,400,000
14,900,000 (Illinois Institute of
Technology), Series A, NBD Bank
N.A.; Northern Trust Company
LOC,
3.500% 09/01/25+............... 14,900,000
11,675,000 (University Pooled Financing
Program), FGIC Insured, NBD
Bank N.A. SBPA,
3.500% 12/02/05+............... 11,675,000
Illinois (State of), Health
Facilities Authority Revenue:
5,600,000 (Childrens Memorial Hospital
Project), Series B, National
Bank of Detroit LOC,
3.500% 11/01/15+............... 5,600,000
7,900,000 (Condell Memorial Hospital
Project), Bank of Tokyo;
Mitsubishi Bank Ltd. LOC,
3.700% 11/01/05+(a)............ 7,900,000
(Evanston Hospital Corporation
Project):
5,000,000 3.650% 10/31/97.................. 5,000,000
7,000,000 3.750% 01/15/98.................. 7,000,000
5,000,000 Series 96,
3.950% 08/15/97................ 5,000,000
3,000,000 (Park Plaza Retirement Center
Project), ABN-AMRO Bank LOC,
3.500% 09/15/20+............... 3,000,000
6,700,000 (The Streeterville Corporation
Project), First National Bank
of Chicago LOC,
3.500% 08/15/24+............... 6,700,000
4,500,000 Kane (County of), Illinois,
Revenue Bonds, (Glenwood School
For Boys), Harris Trust &
Savings Bank, Illinois LOC,
3.500% 02/01/28+............... 4,500,000
4,600,000 Orland Park, Illinois, Industrial
Development Revenue, (Panduit
Corporation Project), AMT,
Wachovia Bank, Georgia LOC,
3.550% 04/01/31+(a)............ 4,600,000
PRINCIPAL VALUE
AMOUNT (NOTE 1)
------------------------------------------------------------
MUNICIPAL BONDS AND NOTES -- (CONTINUED)
ILLINOIS -- (CONTINUED)
$ 7,195,000 Richton Park, Illinois,
Industrial Development Revenue,
(Sinter Metals Inc. Project),
AMT, Mellon Bank LOC,
3.650% 04/01/16+............... $ 7,195,000
1,800,000 Southwestern Illinois Development
Authority, Industrial
Development Revenue, (Robinson
Steel Company Inc. Project),
AMT, American National Bank &
Trust Company LOC,
3.600% 12/01/06+............... 1,800,000
--------------
254,480,000
--------------
INDIANA -- 2.4%
5,400,000 Duneland, Indiana, (Chesterton
School Corporation), Tax
Anticipation Time Warrants,
4.100% 12/31/97................ 5,417,598
Indiana (State of), Development
Finance Authority, Economic
Development Revenue:
2,100,000 (Fischer Enterprises Ltd.
Project), PNC Bank LOC,
3.750% 11/01/01+(a)............ 2,100,000
2,400,000 (Walker-Williams Lumber Company,
Inc.), AMT, Columbus Bank &
Trust Company LOC,
3.800% 01/01/09+(a)............ 2,400,000
Indianapolis, Indiana, Economic
Development Revenue:
1,750,000 (Art Center of Indianapolis
Project), Bank One, Indiana
LOC,
3.550% 02/01/98+(a)............ 1,750,000
2,900,000 (Edgcomb Metals Company Project),
Banque Nationale de Paris LOC,
3.450% 12/01/08+............... 2,900,000
Indianapolis, Indiana,
Multi-family Housing Revenue:
1,300,000 (Canal Square Project), Societe
Generale LOC,
3.500% 12/01/15+............... 1,300,000
3,200,000 (El Beulah Retirement Village),
National Bank of Detroit LOC,
3.550% 03/01/21+(a)............ 3,200,000
3,000,000 Princeton, Indiana, PCR, (PSI
Energy Inc. Project), Canadian
Imperial Bank of Commerce LOC,
3.850% 03/01/19++.............. 3,000,000
Purdue University, Indiana,
University Revenue, Student
Fee:
3,000,000 Series H,
3.450% 07/01/17+............... 3,000,000
3,500,000 Series K,
3.450% 07/01/20+............... 3,500,000
1,500,000 Rockport, Indiana, PCR, (AEP
Generating Company Project),
Series B, AMBAC Insured, Bank
of New York LOC,
3.850% 07/01/25++.............. 1,500,000
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
14
<PAGE> 17
NATIONS FUNDS
Nations Tax Exempt Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) MARCH 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
------------------------------------------------------------
<S> <C>
MUNICIPAL BONDS AND NOTES -- (CONTINUED)
INDIANA -- (CONTINUED)
$ 9,500,000 Vigo (County of), Indiana, School
Corporation Warrants,
4.000% 12/30/97................ $ 9,513,752
--------------
39,581,350
--------------
IOWA -- 0.5%
7,000,000 Iowa (State of), Corporation
Warrant Certificates, Series A,
FSA Insured-State Aid
Withholding,
4.750% 06/27/97#............... 7,012,831
1,400,000 Iowa (State of), Finance
Authority, Solid Waste Disposal
Revenue, (Cedar River Paper
Company Project), Series A,
AMT, Swiss Bank LOC,
4.250% 06/01/24++.............. 1,400,000
--------------
8,412,831
--------------
KANSAS -- 2.4%
9,600,000 Kansas (State of), Development
Finance Authority, (Seaboard
Projects), Series A, AMT, Bank
of New York LOC,
3.550% 12/02/25+(a)............ 9,600,000
22,580,000 Olathe, Kansas, Educational
Facilities Revenue, (Kansas
Independent College
Association), Series A, Midland
Bank Plc LOC,
3.450% 07/01/24+............... 22,580,000
2,800,000 Wichita, Kansas, Industrial
Revenue, (Brenner Tank Inc.
Project), AMT, Bank One LOC,
3.650% 12/01/05+(a)............ 2,800,000
5,000,000 Winfield, Kansas, Industrial
Development Revenue, Morgan
Guaranty Trust Company, New
York; Birrey & Smith LOC,
3.400% 11/01/07+............... 5,000,000
--------------
39,980,000
--------------
KENTUCKY -- 2.9%
13,000,000 Daviess (County of), Kentucky,
Solid Waste Disposal Facilities
Revenue, (Scott Paper Company
Project), Series A, AMT,
Kimberly Clark Guaranty LOC,
3.900% 12/01/23++.............. 13,000,000
1,800,000 Hopkinsville, Kentucky,
Industrial Building Revenue,
(Brazeway Inc. Project), AMT,
NBD Bank, N.A. LOC,
3.750% 06/01/04+(a)............ 1,800,000
5,000,000 Jefferson (County of), Kentucky,
Board of Education, Revenue
Anticipation Notes, Series N,
3.970% 06/30/97................ 5,000,832
2,455,000 Kentucky (Rural), Economic
Development Authority,
Industrial Building Revenue,
(Technos Corporation Project),
AMT, Industrial Bank of Japan,
Ltd. LOC,
3.800% 12/01/09+............... 2,455,000
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
------------------------------------------------------------
<S> <C>
MUNICIPAL BONDS AND NOTES -- (CONTINUED)
KENTUCKY -- (CONTINUED)
$ 7,500,000 Kentucky (State of), Economic
Development Finance Authority,
Hospital Facilities Revenue,
(Baptist Healthcare Systems
Project), Canadian Imperial
Bank of Commerce LOC,
3.450% 08/15/31+............... $ 7,500,000
3,500,000 Lebanon, Kentucky, Industrial
Development Revenue, (Wallace
Computer Services Inc.), AMT,
Wachovia Bank, Georgia LOC,
3.650% 06/01/19+(a)............ 3,500,000
4,525,000 Lexington-Fayette, Kentucky,
Psychiatric Hospital Revenue,
(Charter Ridge Hospital
Project), Bankers Trust Company
LOC,
3.400% 03/01/05+(a)............ 4,525,000
Lexington-Fayette, Kentucky,
Urban County Airport
Corporation Revenue, AMT,
Credit Local de France LOC:
1,100,000 Series A,
3.950% 04/01/24++.............. 1,100,000
3,100,000 Series B,
3.950% 04/01/24++.............. 3,100,000
5,630,000 Louisville and Jefferson
(Counties of), Kentucky,
Visitors and Convention
Commission, FSA Insured,
HypoBank SBPA,
3.550% 01/01/24+(a)............ 5,630,000
--------------
47,610,832
--------------
LOUISIANA -- 3.5%
8,000,000 Ascension Parish, Louisiana, PCR,
(Borden Inc. Project), Credit
Suisse LOC,
3.500% 12/01/09+............... 8,000,000
6,550,000 Caddo Parish, Louisiana,
Industrial Development Board,
(Frymaster Corporation
Project), Chemical Bank LOC,
3.550% 01/01/03+............... 6,550,000
11,385,000 Jefferson Parish, Louisiana,
Hospital Service Revenue,
District Number 1, (West
Jefferson Medical Center),
Rabobank Nederland LOC,
3.500% 01/01/26+............... 11,385,000
5,100,000 Louisiana (State of), Public
Facilities Authority, Hospital
Revenue, (Charter Forest
Hospital Project), Bankers
Trust Company LOC,
3.600% 12/01/13+............... 5,100,000
20,225,000 Louisiana (State of), Public
Facilities Authority, PCR,
(Ciba-Geigy Corporation
Project), Swiss Bank LOC,
3.500% 12/01/04+............... 20,225,000
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
15
<PAGE> 18
NATIONS FUNDS
Nations Tax Exempt Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) MARCH 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
------------------------------------------------------------
<S> <C>
MUNICIPAL BONDS AND NOTES -- (CONTINUED)
LOUISIANA -- (CONTINUED)
$ 5,480,000 Upper Pontalba, Louisiana,
Building Restoration
Corporation Revenue, (Upper
Pontalba Project), Bank One
LOC,
3.550% 12/01/16+............... $ 5,480,000
--------------
56,740,000
--------------
MAINE -- 1.4%
18,150,000 Maine (State of), Solid Waste
Resources Recovery Revenue,
Series K, AMT, Midland Bank Plc
LOC,
3.500% 07/01/12+............... 18,150,000
5,000,000 Maine (State of), Tax
Anticipation Notes,
4.500% 06/27/97................ 5,007,166
--------------
23,157,166
--------------
MARYLAND -- 1.0%
3,300,000 Baltimore (City of), Maryland,
Port Facilities Authority,
(Occidental Petroleum Company),
NatWest LOC,
3.400% 10/14/11+++............. 3,300,000
4,750,000 Maryland (State of), Economic
Development Revenue, (General
Binding Corporation Project),
AMT, Harris Trust & Savings
Bank LOC,
3.650% 03/01/26+(a)............ 4,750,000
2,300,000 Maryland (State of), Industrial
Development Finance Authority,
(Rock-Tennessee Converting
Company), AMT, Trust Company
Bank LOC,
3.550% 05/01/06+(a)............ 2,300,000
6,400,000 Montgomery (County of), Maryland,
Housing Opportunities
Commission, Multi-family
Housing Revenue, Series A, AMT,
3.700% 11/13/97................ 6,400,000
--------------
16,750,000
--------------
MICHIGAN -- 1.7%
Dearborn, Michigan, Economic
Development Corporation
Revenue, (Oakbrook Common
Project), Mellon Bank LOC:
3,500,000 3.450% 03/01/23+................. 3,500,000
2,800,000 3.450% 03/01/25+................. 2,800,000
3,310,000 Jackson (County of), Michigan,
Economic Development
Corporation, Industrial
Development Revenue, (Jackson
Association LLC), Bank One,
Dayton LOC,
3.550% 10/01/14+(a)............ 3,310,000
8,000,000 Michigan (State of), Hospital
Financing Authority Revenue,
(St. Mary Hospital of Livonia),
Series A, Comerica Bank LOC,
3.450% 07/01/17+............... 8,000,000
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
------------------------------------------------------------
<S> <C>
MUNICIPAL BONDS AND NOTES -- (CONTINUED)
MICHIGAN -- (CONTINUED)
$ 3,000,000 Michigan (State of), Housing
Development Authority, Limited
Obligation Revenue, (Pine Ridge
Project), NatWest LOC,
3.500% 10/01/07+............... $ 3,000,000
1,800,000 Michigan (State of), Strategic
Funding Ltd. Obligation
Revenue, (Uni Boring Company
Inc.), National Bank of Detroit
LOC,
3.700% 12/01/98+(a)............ 1,800,000
4,700,000 Wayne Charter (County of),
Michigan, Airport Revenue,
(Detroit Metropolitan County),
Series A, AMT, Bayerische
Landesbank LOC,
3.500% 12/01/16+............... 4,700,000
--------------
27,110,000
--------------
MINNESOTA -- 0.7%
6,050,000 Minneapolis, Minnesota, Community
Development Agency Revenue,
(Arena Acquisition Project),
Series A, First Bank of America
LOC,
3.550% 10/01/24+............... 6,050,000
6,160,000 Minneapolis, Minnesota, Housing
Development Revenue, (Symphony
Place Project), Citibank LOC,
3.450% 12/01/14+............... 6,160,000
--------------
12,210,000
--------------
MISSISSIPPI -- 0.9%
6,200,000 Lawrence (County of),
Mississippi, PCR,
(Georgia-Pacific Corporation
Project), Bank of Tokyo;
Mitsubishi Bank Ltd. LOC,
3.525% 12/01/00+............... 6,200,000
Mississippi Business Finance
Corporation, Industrial
Development Revenue:
2,800,000 (Choctaw Maid Farms Inc.
Project), Rabobank Nederland
LOC,
3.550% 03/01/10+............... 2,800,000
2,700,000 (Mmars 2nd Program Project),
Series A, AMT, Midland Bank
LOC,
3.700% 06/01/05+(a)............ 2,700,000
3,000,000 (Nitek Metal Services Inc.
Project), AMT, Bank of Tokyo
LOC,
3.650% 03/01/05+(a)............ 3,000,000
--------------
14,700,000
--------------
MISSOURI -- 0.3%
5,000,000 Kansas City, Missouri, Industrial
Development Revenue, (Owens-
Illinois Inc. Project),
Industrial Bank of Japan Ltd.
LOC,
3.425% 12/31/08+(a)............ 5,000,000
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
16
<PAGE> 19
NATIONS FUNDS
Nations Tax Exempt Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) MARCH 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
------------------------------------------------------------
<S> <C>
MUNICIPAL BONDS AND NOTES -- (CONTINUED)
MONTANA -- 0.8%
Forsyth, Montana, PCR, AMT:
$ 1,500,000 (Pacificorp Colstrip Project),
Deutsche Bank LOC,
3.950% 12/01/16++(a)........... $ 1,500,000
11,000,000 (Portland General Electric
Company), Banque Nationale de
Paris LOC,
4.000% 12/01/16++.............. 11,000,000
--------------
12,500,000
--------------
NEBRASKA -- 0.2%
4,000,000 York, Nebraska, Industrial
Development Revenue, (Sunstrand
Corporation Project), AMT,
United Bank of Switzerland LOC,
3.700% 08/01/17+............... 4,000,000
--------------
NEW JERSEY -- 0.3%
5,000,000 Jersey City, New Jersey, Bond
Anticipation Notes,
4.500% 09/26/97................ 5,010,539
--------------
NEW MEXICO -- 0.2%
3,100,000 Albuquerque, New Mexico, (Charter
Hospital Inc. Project), Bankers
Trust Company LOC,
3.600% 03/01/14+............... 3,100,000
--------------
NEW YORK -- 0.2%
3,000,000 Erie (County of), New York,
Industrial Development Agency,
Civic Facilities Revenue,
(Depaul Community Facilities
Inc. Project), Key Bank LOC,
3.550% 11/01/16+(a)............ 3,000,000
--------------
NORTH CAROLINA -- 2.3%
8,000,000 Bladen (County of), North
Carolina, Industrial Facilities
and Pollution Control Financing
Authority, (BCH Energy LP
Project), AMT, Bank of Tokyo;
Mitsubishi Bank Ltd. LOC,
3.700% 11/01/20+............... 8,000,000
10,855,000 Charlotte (County of), North
Carolina, Housing Authority,
Multi-family Housing Revenue,
(Merrywood Senior Adult
Project), AMT, Branch Banking
and Trust Company LOC,
3.700% 06/01/11+............... 10,855,000
2,865,000 Iredell, (County of), North
Carolina, Industrial Facilities
and Pollution Control Financing
Authority, (Sullivan
Corporation Project), AMT, Bank
One LOC,
3.650% 01/01/11+(a)............ 2,865,000
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
------------------------------------------------------------
<S> <C>
MUNICIPAL BONDS AND NOTES -- (CONTINUED)
NORTH CAROLINA -- (CONTINUED)
Mecklenburg (County of), North
Carolina, Industrial Facilities
and Pollution Control Finance
Authority:
$ 2,000,000 (Sterigenics International
Project), AMT, Comerica Bank,
California LOC,
3.700% 03/01/16+(a)............ $ 2,000,000
1,875,000 (Virkler Company Project), AMT,
First Union National Bank,
Charlotte LOC,
3.550% 12/01/04+(a)............ 1,875,000
4,400,000 Randolph (County of), North
Carolina, Industrial Facilities
and Pollution Control Financing
Authority, (Wayne Steel Inc.),
AMT, Bank One, Akron LOC,
3.650% 09/01/05+(a)............ 4,400,000
3,300,000 Stanley (County of), North
Carolina, Industrial
Development Authority, PCR,
(General Signal Corporation),
Wachovia Bank, Georgia LOC,
3.650% 12/01/00+............... 3,300,000
3,810,000 Winston-Salem, North Carolina,
(Risk Acceptance Management
Corporation Project),
Certificates of Participation,
Series 1988, NatWest SBPA,
3.450% 07/01/09+(a)............ 3,810,000
--------------
37,105,000
--------------
OHIO -- 2.2%
2,340,000 Defiance (County of), Ohio,
Industrial Development Revenue,
(Isaac Property Company),
Series A, Key Bank LOC,
3.550% 07/01/00+(a)............ 2,340,000
3,600,000 Lorain (County of), Ohio,
Hospital Revenue, (Humility of
Mary Health Care Corporation
Hospital), Series B, PNC Bank
LOC,
3.600% 12/15/03+............... 3,600,000
Ohio (State of), Air Quality
Development Authority Revenue:
10,000,000 (Duquesne Power), United Bank of
Switzerland LOC,
3.950% 07/16/97................ 10,000,000
9,600,000 (JMG Funding Limited
Partnership), Series A, AMT,
Societe Generale LOC,
3.500% 04/01/28+............... 9,600,000
3,500,000 Ohio (State of), Water
Development Authority, (Ohio
Edison Company Project), AMT,
United Bank of Switzerland LOC,
3.800% 05/01/97................ 3,500,000
5,050,000 Ohio State University, General
Receipts, Series B,
3.200% 12/01/12+............... 5,050,000
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
17
<PAGE> 20
NATIONS FUNDS
Nations Tax Exempt Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) MARCH 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
------------------------------------------------------------
<S> <C>
MUNICIPAL BONDS AND NOTES -- (CONTINUED)
OHIO -- (CONTINUED)
$ 2,400,000 St. Marys, Ohio, Industrial
Development Revenue, (Setex
Inc. Project), AMT, Industrial
Bank of Japan Ltd. LOC,
3.800% 12/01/01+............... $ 2,400,000
--------------
36,490,000
--------------
OKLAHOMA -- 0.6%
5,000,000 Oklahoma (State of), Development
Finance Authority Revenue,
(Seaboard Farms Inc. Project),
AMT, Bank of New York LOC,
3.550% 03/01/27+(a)............ 5,000,000
4,130,000 Oklahoma (State of), Housing
Finance Agency, Single Family
Housing Revenue, PFloats PT41,
AMT, GNMA Collateralized,
Commerzbank SBPA,
3.650% 08/01/18+(a)............ 4,130,000
--------------
9,130,000
--------------
OREGON -- 1.9%
Oregon (State of), GO, Morgan
Guaranty Trust Company, New
York LOC:
14,600,000 Series 73G,
3.400% 12/01/18+............... 14,600,000
9,800,000 Series 73H,
3.400% 12/01/19+............... 9,800,000
5,500,000 Portland (City of), Oregon,
Multi-family Housing Revenue,
(University Park Apartments
Project), Chase Manhattan Bank
LOC,
3.500% 10/01/11+(a)............ 5,500,000
2,000,000 Washington (County of), Oregon,
Housing Authority, Multi-family
Housing Revenue, (Cedar Mill
Project), AMT, Societe Generale
LOC,
3.600% 09/20/25+............... 2,000,000
--------------
31,900,000
--------------
PENNSYLVANIA -- 4.8%
Allegheny (County of),
Pennsylvania, Industrial
Development Authority, Duquesne
Power:
5,000,000 Canadian Imperial Bank of
Commerce LOC,
3.650% 10/30/97................ 5,000,000
9,700,000 United Jewish Federation, Series
B, PNC Bank LOC,
3.600% 10/01/25+(a)............ 9,700,000
Delaware (County of),
Pennsylvania, Industrial
Development Authority, PCR, (BP
Oil Inc. Project), The British
Petroleum Company Plc LOC:
4,700,000 3.850% 12/01/09++................ 4,700,000
3,400,000 3.850% 10/01/19++................ 3,400,000
Delaware Valley, Pennsylvania,
Regional Finance Authority,
Midland Bank LOC:
10,000,000 Local Government Revenue, Series
C,
3.500% 12/01/20+............... 10,000,000
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
------------------------------------------------------------
<S> <C>
MUNICIPAL BONDS AND NOTES -- (CONTINUED)
PENNSYLVANIA -- (CONTINUED)
$14,700,000 Series 1986,
3.500% 08/01/16+............... $ 14,700,000
5,000,000 Montgomery (County of),
Pennsylvania, Industrial
Development Authority Revenue,
(Plymouth Woods Project), PNC
Bank LOC,
3.600% 09/01/06+(a)............ 5,000,000
4,000,000 Pennsylvania (State of), GO,
(Pennsylvania State University
Project), Series A,
4.500% 11/25/97(a)............. 4,022,021
1,200,000 Pennsylvania (State of), Higher
Education Facilities Authority
Revenue, (Carnegie Mellon
University), Series C, Union
Bank of Switzerland LOC,
3.850% 11/01/29++.............. 1,200,000
10,000,000 Philadelphia, Pennsylvania,
School District, Tax and
Revenue Anticipation Notes,
4.500% 06/30/97................ 10,011,871
5,500,000 Quakertown, Pennsylvania, General
Authority Revenue, (Pooled
Financing Program), Series A,
PNC Bank LOC,
3.500% 07/01/26+............... 5,500,000
4,925,000 Union (County of), Pennsylvania,
Hospital Authority Revenue,
(Evangelical Community
Hospital), Series B, PNC Bank
LOC,
3.600% 10/01/23+............... 4,925,000
--------------
78,158,892
--------------
RHODE ISLAND -- 0.2%
4,000,000 Rhode Island (State of),
Industrial Facilities
Corporation, Industrial
Development Revenue, (Handy &
Harman Electric Project), Bank
of Nova Scotia LOC,
3.550% 04/01/04+(a)............ 4,000,000
--------------
SOUTH CAROLINA -- 1.7%
6,100,000 Charleston, South Carolina,
Hospital Facilities Revenue,
(Brown Schools Charleston),
Bankers Trust Company LOC,
3.600% 06/01/11+............... 6,100,000
5,175,000 Kershaw (County of), South
Carolina, Industrial
Development Revenue, (Deroyal
Textiles Inc. Project), AMT,
SunTrust Bank LOC,
3.550% 12/01/07+(a)............ 5,175,000
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
18
<PAGE> 21
NATIONS FUNDS
Nations Tax Exempt Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) MARCH 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
------------------------------------------------------------
<S> <C>
MUNICIPAL BONDS AND NOTES -- (CONTINUED)
SOUTH CAROLINA -- (CONTINUED)
$ 7,340,000 South Carolina (State of),
Housing Authority, Rental
Housing Revenue, (Hampton
Pointe Apartments Project),
Bank of New York LOC,
3.550% 12/01/07+............... $ 7,340,000
South Carolina (State of), Jobs,
Economic Development Authority,
Health Facilities Revenue:
5,960,000 (Martha Franks Baptist Center
Project), Wachovia Bank,
Columbia LOC,
3.500% 04/01/19+(a)............ 5,960,000
3,400,000 (Specialty Equipment Companies
Project), AMT, Barclays Bank
Plc LOC,
3.650% 11/01/10+(a)............ 3,400,000
--------------
27,975,000
--------------
TENNESSEE -- 1.4%
1,600,000 Bradley (County of), Tennessee,
Industrial Development Board,
Industrial Development Revenue,
(Olin Corporation Project),
Series C, Wachovia Bank,
Georgia LOC,
4.000% 11/01/17++.............. 1,600,000
2,650,000 Chattanooga, Tennessee,
Industrial Development Board,
(Warehouse Row Limited
Project), Credit Suisse LOC,
3.500% 12/15/12+............... 2,650,000
6,969,000 Cumberland (County of),
Tennessee, Industrial
Development Board, Industrial
Development Revenue,
(Crossville Ceramics Company
Project), National Bank of
Detroit LOC,
3.500% 01/01/00+(a)............ 6,969,000
2,300,000 Jackson (County of), Tennessee,
Industrial Development Board,
(Essette Project), Series A,
Bank of America LOC,
3.550% 08/01/00+(a)............ 2,300,000
6,600,000 Metropolitan Nashville (County
of), Tennessee, Airport
Authority, Special Facilities
Revenue, (American Airlines
Inc. Project), Series A, Credit
Suisse LOC,
3.800% 10/01/12++.............. 6,600,000
3,245,000 Shelby (County of), Tennessee,
Health Educational & Housing
Facilities Board, Multi-family
Housing Revenue, (Flag Manor),
AMT, Federal Home Loan Bank,
Indianapolis LOC,
3.600% 01/01/23+(a)............ 3,245,000
--------------
23,364,000
--------------
TEXAS -- 6.4%
3,800,000 Bexar (County of), Texas, (Army
Retirement), Series 85-B,
Rabobank Nederland LOC,
3.400% 07/01/11+............... 3,800,000
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
------------------------------------------------------------
<S> <C>
MUNICIPAL BONDS AND NOTES -- (CONTINUED)
TEXAS -- (CONTINUED)
$ 1,000,000 Brazos River, Texas, Higher
Educational Authority,
(Hoffman-Laroche), Wachovia
Bank, Georgia LOC,
3.425% 04/01/02+(a)............ $ 1,000,000
3,000,000 El Paso, Texas, Multi-family
Housing Finance Corporation,
(Viva Apartments Project), AMT,
General Electric Capital
Corporation LOC,
3.650% 09/01/23+(a)............ 3,000,000
Grapevine, Texas, Industrial
Development Corporation
Revenue, (American Airlines
Inc. Project), Morgan Guaranty
Trust Company, New York LOC:
1,000,000 Series A1,
3.800% 12/01/24++.............. 1,000,000
1,100,000 Series B3,
3.800% 12/01/24++.............. 1,100,000
3,000,000 Greater Texas Student Loan, AMT,
SLMA Collateralized,
3.700% 03/01/98#............... 3,000,000
Harris (County of), Texas, Health
Facilities Revenue, Development
Corporation Hospital Revenue:
6,000,000 (St. Luke's Episcopal Hospital),
Series A, St. Luke's Episcopal
SBPA,
3.850% 02/15/21++.............. 6,000,000
2,500,000 (St. Luke's Episcopal Hospital),
Series D, Morgan Guaranty Trust
Company SBPA,
3.850% 02/15/16++.............. 2,500,000
Harris (County of), Texas,
Industrial Development
Corporation, Industrial
Development Revenue, AMT:
4,000,000 (Forged Products Inc. Project),
Banc One LOC,
3.650% 05/01/03+(a)............ 4,000,000
4,200,000 (Zeon Chemicals Project),
Industrial Bank of Japan, Ltd.
LOC,
3.800% 02/01/09+............... 4,200,000
3,700,000 McAllen, Texas, Health Facilities
Development Revenue, PNC Bank
LOC,
3.450% 12/01/24+............... 3,700,000
7,600,000 Montgomery (County of), Texas,
Industrial Development
Corporation Revenue, (Houston
Area Research Center Project),
Banque National de Paris LOC,
3.550% 12/01/15+............... 7,600,000
9,200,000 Port Development Corporation,
(Pasadena Marine Terminal
Company Project), ABN-AMRO Bank
LOC,
3.650% 12/01/04+............... 9,200,000
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
19
<PAGE> 22
NATIONS FUNDS
Nations Tax Exempt Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) MARCH 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
------------------------------------------------------------
<S> <C>
MUNICIPAL BONDS AND NOTES -- (CONTINUED)
TEXAS -- (CONTINUED)
$ 1,400,000 Sabine River, Texas, PCR, (Texas
Utilities Electric Company),
Series A, Morgan Guaranty Trust
Company, New York LOC,
3.950% 04/01/30++.............. $ 1,400,000
2,000,000 San Antonio, Texas, Industrial
Development Revenue, (Colin
Medical Instruments Corporation
Project), AMT, Sanwa Bank LOC,
3.800% 01/01/99+............... 2,000,000
2,600,000 Sulphur Springs, Texas,
Industrial Development
Authority, (Hon Industrial Inc.
Project), Credit Suisse LOC,
3.550% 12/01/13+(a)............ 2,600,000
40,000,000 Texas (State of), Tax and Revenue
Anticipation Notes, Series A,
4.750% 08/29/97................ 40,127,025
8,400,000 West Side Calhoun (County of),
Texas, Development Corporation
Revenue, (Sohio Chemical
Company Project), British
Petroleum Guaranty,
3.850% 12/01/15++.............. 8,400,000
--------------
104,627,025
--------------
UTAH -- 2.1%
5,000,000 Intermountain Power Agency, Utah,
Power Supply Revenue, Series F,
Morgan Guaranty Trust Company,
New York LOC,
3.930% 06/16/97#............... 5,000,000
2,000,000 Murray (City of), Utah,
Industrial Revenue, (Zevex Inc.
Project), AMT, Bank One LOC,
3.650% 10/01/16+(a)............ 2,000,000
3,200,000 Murray (County of), Utah,
Industrial Development
Authority, (Hunter Douglas
Realty Property), AMT, ABN-AMRO
Bank LOC,
3.550% 09/01/14+(a)............ 3,200,000
14,300,000 Salt Lake (City of), Utah, Health
Care Facilities Revenue, Class
A, Westdeutsche Landesbank SBPA
LOC,
3.450% 01/01/20+............... 14,300,000
4,500,000 Salt Lake (City of), Utah,
Industrial Development Revenue,
(SPS Technologies Inc.
Project), AMT, National
Australia Bank Ltd. LOC,
3.750% 12/01/12+............... 4,500,000
4,200,000 Salt Lake (City of), Utah, PCR,
(Service Station Holdings Inc.
Project), Series B, British
Petroleum Guaranty,
3.850% 08/01/07++.............. 4,200,000
1,200,000 West Valley (City of), Utah,
Industrial Development Revenue,
(Johnson Matthey Inc. Project),
Canadian Imperial Bank of
Commerce LOC,
3.950% 12/01/11++(a)........... 1,200,000
--------------
34,400,000
--------------
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
------------------------------------------------------------
<S> <C>
MUNICIPAL BONDS AND NOTES -- (CONTINUED)
VIRGINIA -- 1.0%
$ 1,000,000 Chesapeake, Virginia, Industrial
Development Authority, (Volvo
Project), AMT, United Bank of
Switzerland LOC,
3.500% 12/01/06+(a)............ $ 1,000,000
2,500,000 Colonial Heights, Virginia,
Industrial Development
Authority, (Philip Morris
Company Project),
3.500% 03/01/05+(a)............ 2,500,000
2,000,000 Fluvanna (County of), Virginia,
Industrial Development
Authority Revenue, (Edgcomb
Metals Company Project), Banque
National de Paris LOC,
3.400% 12/01/09+(a)............ 2,000,000
3,900,000 Greensville (County of),
Virginia, Industrial
Development Authority, PCR,
(Perdue Farms Inc. Project),
AMT, Southtrust Bank LOC,
3.550% 10/01/06+(a)............ 3,900,000
2,000,000 Spotsylvania (County of),
Virginia, Industrial
Development Revenue, (Carlisle
Corporation Project), Trust
Company Bank LOC,
3.500% 06/01/08+(a)............ 2,000,000
5,500,000 Virginia College Building
Authority, Educational
Facilities Revenue, (University
of Richmond Project), Crestar
Bank SBPA LOC,
3.450% 11/01/26+............... 5,500,000
--------------
16,900,000
--------------
WASHINGTON -- 2.3%
2,905,000 Pierce (County of), Washington,
Housing Authority Revenue,
(Eagles Watch Project), Key
Bank LOC,
3.450% 10/01/20+............... 2,905,000
3,500,000 Port Kalama, Washington, Public
Port Facilities Corporation,
(Conagra Inc. Project), Morgan
Guaranty Trust Company, New
York LOC,
3.300% 01/01/04+............... 3,500,000
4,015,000 Washington (State of), GO, Series
A,
6.500% 07/01/97................ 4,040,262
7,075,000 Washington (State of), Housing
Finance Authority, Multi-family
Mortgage Revenue, (Inglenook
Court Project), AMT, Bank of
America LOC,
3.900% 07/01/25++.............. 7,075,000
Washington (State of), Public
Power Supply System, Bank of
America LOC:
5,000,000 (Nuclear Project Number 1),
Series 1A-2,
3.400% 07/01/17+............... 5,000,000
14,625,000 (Nuclear Project Number 3),
Series 3A-1,
3.400% 07/01/18+............... 14,625,000
--------------
37,145,262
--------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
20
<PAGE> 23
NATIONS FUNDS
Nations Tax Exempt Fund
- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS (CONTINUED) MARCH 31, 1997
<TABLE>
<CAPTION>
PRINCIPAL VALUE
AMOUNT (NOTE 1)
------------------------------------------------------------
<S> <C>
MUNICIPAL BONDS AND NOTES -- (CONTINUED)
WEST VIRGINIA -- 2.0%
$10,000,000 Fayette (County of), West
Virginia, County Commission,
Solid Waste Disposal Facilities
Revenue, (Georgia-Pacific
Corporation Project), AMT,
Industrial Bank of Japan Ltd.
LOC,
3.700% 05/01/18+(a)............ $ 10,000,000
22,780,000 West Virginia (State of),
Hospital Finance Authority,
Hospital Revenue, (St. Mary's
Hospital Project), Bank One
LOC,
3.500% 10/01/12+............... 22,780,000
--------------
32,780,000
--------------
WISCONSIN -- 2.6%
5,200,000 Appleton, Wisconsin, Area School
District, Tax and Revenue
Anticipation Promissory Notes,
4.000% 09/26/97................ 5,202,915
Beaver Dam, Wisconsin, Unified
School District, Tax
Anticipation Notes:
3,000,000 3.800% 10/14/97.................. 3,002,763
2,000,000 3.850% 10/14/97.................. 2,001,994
4,000,000 Menomonee Falls, Wisconsin,
Industrial Development
Authority Revenue, (Jemma LLC
Project), AMT, Bank One LOC,
3.650% 09/01/14+(a)............ 4,000,000
Oshkosh, Wisconsin, Area School
District, Tax and Revenue
Anticipation Promissory Notes:
5,000,000 4.250% 08/20/97.................. 5,005,563
4,500,000 4.500% 08/20/97.................. 4,509,196
5,200,000 Pleasant Prairie, Wisconsin,
Industrial Development
Authority Revenue, (Nucon
Corporation Project), AMT,
American National Bank & Trust
Company LOC,
3.650% 02/01/22+............... 5,200,000
5,200,000 Pewaukee, Wisconsin, School
District, Tax and Revenue
Anticipation Notes,
4.500% 09/22/97................ 5,209,950
8,435,000 Wisconsin (State of), Health
Facilities Authority,
(Daughters of Charity),
3.450% 11/01/16+(a)............ 8,435,000
--------------
42,567,381
--------------
TOTAL MUNICIPAL BONDS
AND NOTES
(Cost $1,633,384,352)............ 1,633,384,352
------------
</TABLE>
<TABLE>
<CAPTION>
VALUE
SHARES (NOTE 1)
------------------------------------------------------------
<S> <C>
MONEY MARKET FUNDS -- 0.0%##
50,000 AIM Tax-Exempt Fund.............. $ 50,000
130,000 Fidelity Institutional Tax-Exempt
Cash Fund...................... 130,000
--------------
TOTAL MONEY MARKET FUNDS
(Cost $180,000)................ 180,000
------------
TOTAL INVESTMENTS
(Cost $1,633,564,352*).............. 99.8% 1,633,564,352
OTHER ASSETS AND
LIABILITIES (NET)................... 0.2 2,932,263
----- --------------
NET ASSETS............................ 100.0% $1,636,496,615
---- ------------
</TABLE>
- ---------------
* Aggregate cost for Federal tax purposes.
+ Variable rate demand notes payable upon not more than seven calendar days'
notice. The interest rate shown reflects the rate in effect at March 31,
1997.
++ Variable rate demand notes payable upon not more than one calendar day's
notice. The interest rate shown reflects the rate in effect at March 31,
1997.
+++ Variable rate demand notes payable upon not more than thirty calendar days'
notice. The interest rate shown reflects the rate in effect at March 31,
1997.
# Put date.
## Amount represents less than 0.1%.
(a) Securities are not registered under the Securities Act of 1933. These
securities may be resold in transactions exempt from registration to
qualified institutional buyers.
Nations Tax Exempt Fund had the following industry concentrations greater than
10% at March 31, 1997 (as a percentage of net assets):
<TABLE>
<S> <C>
Medical Facilities Revenue 14.4%
Industrial Facilities Revenue 13.4
Pollution Control Revenue 12.7
Housing Revenue 10.8
</TABLE>
ABBREVIATIONS:
AMBAC American Municipal Bond Assurance Corporation
AMT Alternative Minimum Tax
CFC Cooperative Finance Corporation
FGIC Federal Guaranty Investment Corporation
FNMA Federal National Mortgage Association
FSA Financial Security Assurance
GNMA Government National Mortgage Association
GO General Obligation
LOC Letter of Credit
MBIA Municipal Bond Investors Assurance
PCR Pollution Control Revenue
SBPA Standby Bond Purchase Agreement
SLMA Student Loan Marketing Association
SEE NOTES TO FINANCIAL STATEMENTS.
21
<PAGE> 24
NATIONS FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES MARCH 31, 1997
<TABLE>
<CAPTION>
NATIONS
NATIONS GOVERNMENT NATIONS NATIONS
PRIME MONEY MARKET TREASURY TAX EXEMPT
FUND FUND FUND FUND
------------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS:
Investments, at value (Note 1), See accompanying schedules:
Securities................................................ $4,155,759,191 $373,032,830 $ 597,229,522 $1,633,564,352
Repurchase agreements..................................... 200,000,000 -- 3,011,921,000 --
-------------- ------------ -------------- --------------
Total investments....................................... 4,355,759,191 373,032,830 3,609,150,522 1,633,564,352
Cash........................................................ 687 134 350 37,310
Interest receivable......................................... 28,507,674 3,725,328 4,256,194 8,997,304
Dividends receivable........................................ 161,984 30,944 322,670 11,840
Receivable for Fund shares sold............................. 17,713,455 104,538 436,536 956,719
Prepaid expenses and other assets........................... 311,243 49,714 167,547 94,454
-------------- ------------ -------------- --------------
Total Assets.............................................. 4,402,454,234 376,943,488 3,614,333,819 1,643,661,979
-------------- ------------ -------------- --------------
LIABILITIES:
Payable for reverse repurchase agreements (Note 1).......... -- -- 471,921,000 --
Payable for Fund shares redeemed............................ 14,898,259 57,119 9,053,376 1,320,344
Payable for investment securities purchased................. 14,378,381 -- -- 2,000,000
Investment advisory fee payable (Note 2).................... 640,851 47,450 407,806 238,000
Administration fee payable (Note 2)......................... 292,403 25,230 186,237 112,358
Shareholder servicing and distribution fees payable (Note
3)........................................................ 487,829 17,865 411,557 81,148
Transfer agent fees payable (Note 2)........................ 122,690 3,839 98,285 74,010
Custodian fees payable (Note 2)............................. 67,982 8,823 58,203 29,190
Dividends payable........................................... 12,136,973 1,430,614 8,559,512 3,197,525
Accrued Trustees'/Directors' fees and expenses (Note 2)..... 189,761 25,138 123,699 82,857
Accrued expenses and other payables......................... 102,786 13,700 72,396 29,932
-------------- ------------ -------------- --------------
Total Liabilities......................................... 43,317,915 1,629,778 490,892,071 7,165,364
-------------- ------------ -------------- --------------
NET ASSETS.................................................. $4,359,136,319 $375,313,710 $3,123,441,748 $1,636,496,615
------------ ------------ ------------ ------------
Investments, at cost........................................ $4,355,759,191 $373,032,830 $3,609,150,522 $1,633,564,352
------------ ------------ ------------ ------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
22
<PAGE> 25
NATIONS FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES (CONTINUED) MARCH 31, 1997
<TABLE>
<CAPTION>
NATIONS
NATIONS GOVERNMENT NATIONS NATIONS
PRIME MONEY MARKET TREASURY TAX EXEMPT
FUND FUND FUND FUND
------------------------------------------------------------------
<S> <C> <C> <C> <C>
NET ASSETS CONSIST OF:
Undistributed net investment income......................... $ -- $ 13,157 $ 10,103 $ 5,737
Accumulated net realized loss on investments sold........... (469,796) (61,569) (38,754) (70,413)
Paid-in capital............................................. 4,359,606,115 375,362,122 3,123,470,399 1,636,561,291
-------------- ------------ -------------- --------------
$4,359,136,319 $375,313,710 $3,123,441,748 $1,636,496,615
------------ ------------ ------------ ------------
NET ASSETS:
Primary A Shares............................................ $2,533,688,089 $299,394,439 $1,345,584,624 $1,184,312,571
------------ ------------ ------------ ------------
Primary B Shares............................................ $ 184,021,014 $19,450,413 $ 55,169,928 $ 13,150,633
------------ ------------ ------------ ------------
Investor A Shares........................................... $1,157,723,645 $18,717,398 $ 719,198,716 $ 145,337,340
------------ ------------ ------------ ------------
Investor B Shares........................................... $ 381,015,229 $27,749,613 $ 973,297,002 $ 228,600,507
------------ ------------ ------------ ------------
Investor C Shares........................................... $ 93,678,454 $ 2,141,895 $ 13,868,016 $ 62,761,425
------------ ------------ ------------ ------------
Daily Shares (formerly Investor D Shares)................... $ 9,009,888 $ 7,859,952 $ 16,323,462 $ 2,334,139
------------ ------------ ------------ ------------
SHARES OUTSTANDING:
Primary A Shares............................................ 2,533,953,919 299,435,414 1,345,578,004 1,184,359,571
------------ ------------ ------------ ------------
Primary B Shares............................................ 184,040,321 19,453,075 55,169,656 13,151,157
------------ ------------ ------------ ------------
Investor A Shares........................................... 1,157,845,110 18,719,959 719,195,178 145,343,185
------------ ------------ ------------ ------------
Investor B Shares........................................... 381,055,205 27,753,412 973,292,213 228,609,778
------------ ------------ ------------ ------------
Investor C Shares........................................... 93,688,283 2,142,188 13,867,948 62,763,868
------------ ------------ ------------ ------------
Daily Shares................................................ 9,010,833 7,861,028 16,323,382 2,334,257
------------ ------------ ------------ ------------
PRIMARY A SHARES:
Net asset value, offering and redemption price per share.... $1.00 $1.00 $1.00 $1.00
---- ----- ---- ----
PRIMARY B SHARES:
Net asset value, offering and redemption price per share.... $1.00 $1.00 $1.00 $1.00
---- ----- ---- ----
INVESTOR A SHARES:
Net asset value, offering and redemption price per share.... $1.00 $1.00 $1.00 $1.00
---- ----- ---- ----
INVESTOR B SHARES:
Net asset value, offering and redemption price per share.... $1.00 $1.00 $1.00 $1.00
---- ----- ---- ----
INVESTOR C SHARES:
Net asset value, offering and redemption price per share.... $1.00 $1.00 $1.00 $1.00
---- ----- ---- ----
DAILY SHARES:
Net asset value, offering and redemption price per share.... $1.00 $1.00 $1.00 $1.00
---- ----- ---- ----
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
23
<PAGE> 26
NATIONS FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED MARCH 31, 1997
<TABLE>
<CAPTION>
NATIONS
NATIONS GOVERNMENT NATIONS NATIONS
PRIME MONEY MARKET TREASURY TAX EXEMPT
FUND FUND FUND FUND
------------------------------------------------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest........................................................... $227,095,179 $22,135,826 $130,669,576 $52,144,752
Dividends.......................................................... 2,758,523 294,368 4,251,717 189,593
------------ ----------- ----------- -----------
Total investment income........................................ 229,853,702 22,430,194 134,921,293 52,334,345
------------ ----------- ----------- -----------
EXPENSES:
Investment advisory fee (Note 2)................................... 8,428,901 1,682,675 5,057,410 5,897,339
Administration fee (Note 2)........................................ 4,175,336 420,667 2,505,101 1,474,335
Transfer agent fees (Note 2)....................................... 588,064 57,640 382,073 231,552
Custodian fees (Note 2)............................................ 426,380 56,271 315,012 159,148
Legal and audit fees............................................... 379,431 52,228 243,521 145,543
Trustees'/Directors' fees and expenses (Note 2).................... 133,784 16,418 85,209 73,117
Other.............................................................. 385,416 101,509 199,831 181,184
------------ ----------- ----------- -----------
Subtotal....................................................... 14,517,312 2,387,408 8,779,157 8,162,218
Shareholder servicing and distribution fees (Note 3):
Primary B Shares................................................. 503,055 55,927 173,395 31,701
Investor A Shares................................................ 3,845,194 98,092 569,207 338,807
Investor B Shares................................................ 858,611 124,523 3,544,545 363,932
Investor C Shares................................................ 208,356 5,154 31,570 87,970
Daily Shares..................................................... 5,018 3,648 3,311 709
Fees waived by investment adviser and administrator (Note 2)....... (1,999,274) (1,127,173) (1,277,277) (3,741,122)
------------ ----------- ----------- -----------
Total expenses................................................. 17,938,272 1,547,579 11,832,908 5,244,215
------------ ----------- ----------- -----------
NET INVESTMENT INCOME.............................................. 211,915,430 20,882,615 123,088,385 47,090,130
------------ ----------- ----------- -----------
NET REALIZED GAIN/(LOSS) ON INVESTMENTS (NOTE 1)................... 2,522 1,339 18,200 (1,480)
------------ ----------- ----------- -----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS............... $211,917,952 $20,883,954 $123,106,585 $47,088,650
============ =========== ============ ===========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
24
<PAGE> 27
NATIONS FUNDS
Nations Treasury Fund
- --------------------------------------------------------------------------------
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED MARCH 31, 1997
<TABLE>
<S> <C> <C>
Cash flows from operating and investing activities:
Investment income received..................................................... $ 118,585,800
Payment of operating expenses.................................................. (11,628,125)
Net purchases and sales of short-term investments.............................. (563,423,562)
----------------
Cash used by operating and investing activities.................................. $(456,465,887)
Cash flows from financing activities:
Proceeds from shares sold...................................................... 13,233,758,448
Payment for shares redeemed.................................................... (12,603,740,214)
Cash used from reverse repurchase agreement.................................... (59,835,000)
Distributions paid*............................................................ (113,717,328)
----------------
Cash provided by financing activities............................................ 456,465,906
-------------
Increase in cash................................................................. 19
Cash at beginning of year........................................................ 331
-------------
Cash at end of year.............................................................. $ 350
=============
RECONCILIATION OF NET INCREASE IN NET ASSETS FROM OPERATIONS TO CASH USED BY
OPERATING AND INVESTING ACTIVITIES:
Net increase in net assets resulting from operations............................. $ 123,106,585
Increase in investments........................................................ $ (581,544,674)
Decrease in interest and dividends receivable.................................. 1,767,419
Decrease in other assets....................................................... 19,636
Increase in accrued expenses................................................... 185,147 (579,572,472)
---------------- -------------
Cash used by operating and investing activities.................................. $(456,465,887)
=============
</TABLE>
- ---------------
* Non-cash activities include reinvestment of dividends of $10,444,427.
SEE NOTES TO FINANCIAL STATEMENTS.
25
<PAGE> 28
NATIONS FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED MARCH 31, 1997
<TABLE>
<CAPTION>
NATIONS
NATIONS GOVERNMENT NATIONS NATIONS
PRIME MONEY MARKET TREASURY TAX EXEMPT
FUND FUND FUND FUND
--------------------------------------------------------------
<S> <C> <C> <C> <C>
Net investment income.................................. $ 211,915,430 $ 20,882,615 $ 123,088,385 $ 47,090,130
Net realized gain/(loss) on investments................ 2,522 1,339 18,200 (1,480)
-------------- ------------ -------------- --------------
Net increase in net assets resulting from operations... 211,917,952 20,883,954 123,106,585 47,088,650
Distributions to shareholders from net investment
income:
Primary A Shares..................................... (127,428,642) (16,005,498) (42,850,726) (35,293,502)
Primary B Shares..................................... (9,968,081) (1,068,560) (3,347,375) (380,490)
Investor A Shares.................................... (53,311,689) (1,292,731) (7,715,087) (4,059,182)
Investor B Shares.................................... (17,025,636) (2,383,399) (68,532,266) (5,532,546)
Investor C Shares.................................... (4,133,462) (98,717) (611,667) (1,820,710)
Daily Shares......................................... (47,920) (33,710) (31,264) (3,700)
Net increase/(decrease) in net assets from Fund share
transactions:
Primary A Shares..................................... 61,206,993 (37,373,510) 524,546,725 105,546,666
Primary B Shares..................................... 87,724,370 (12,131,029) 7,681,748 3,780,463
Investor A Shares.................................... 58,232,248 (30,027,577) 629,610,623 16,923,712
Investor B Shares.................................... 22,368,779 (34,870,084) (551,757,395) 95,689,951
Investor C Shares.................................... 18,857,687 411,437 5,084,728 (3,982,155)
Daily Shares......................................... 8,970,359 7,858,911 16,321,269 2,332,190
-------------- ------------ -------------- --------------
Net increase/(decrease) in net assets.................. 257,362,958 (106,130,513) 631,505,898 220,289,347
NET ASSETS:
Beginning of year...................................... 4,101,773,361 481,444,223 2,491,935,850 1,416,207,268
-------------- ------------ -------------- --------------
End of year............................................ $4,359,136,319 $ 375,313,710 $3,123,441,748 $1,636,496,615
============== ============= ============== ==============
Undistributed net investment income at end of year..... $ -- $ 13,157 $ 10,103 $ 5,737
============== ============= ============== ==============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
26
<PAGE> 29
NATIONS FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE PERIOD ENDED MARCH 31, 1996
<TABLE>
<CAPTION>
NATIONS
NATIONS GOVERNMENT NATIONS NATIONS
PRIME MONEY MARKET TREASURY TAX EXEMPT
FUND(a) FUND(b) FUND(a) FUND(b)
---------------------------------------------------------------
<S> <C> <C> <C> <C>
Net investment income................................. $ 190,945,353 $ 8,158,679 $ 134,105,989 $ 15,271,173
Net realized loss on investments...................... (42,433) (1,658) (46,919) --
-------------- ------------ --------------- --------------
Net increase in net assets resulting from
operations.......................................... 190,902,920 8,157,021 134,059,070 15,271,173
Distributions to shareholders from net investment
income:
Primary A Shares.................................... (130,059,809) (5,993,420) (99,400,052) (11,805,259)
Primary B Shares.................................... (5,121,793) (454,644) (2,534,994) (116,636)
Investor A Shares................................... (39,740,146) (787,770) (5,129,970) (1,347,117)
Investor B Shares................................... (13,005,667) (882,980) (26,681,463) (1,418,100)
Investor C Shares................................... (3,015,901) (39,832) (350,433) (584,042)
Daily Shares........................................ (2,037) (33) (83) (19)
Distributions to shareholders from net realized gain
on investments:
Primary A Shares.................................... -- -- (6,502) --
Primary B Shares.................................... -- -- (176) --
Investor A Shares................................... -- -- (362) --
Investor B Shares................................... -- -- (1,930) --
Investor C Shares................................... -- -- (24) --
Daily Shares........................................ -- -- -- --
Net increase/(decrease) in net assets from Fund share
transactions:
Primary A Shares.................................... (400,652,057) 3,872,972 (2,075,795,502) 173,638,492
Primary B Shares.................................... (29,817,441) 4,458,845 (9,326,431) (2,296,026)
Investor A Shares................................... 401,182,199 22,569,043 (17,889,209) 2,205,180
Investor B Shares................................... 141,690,333 35,541,203 1,472,486,586 46,541,215
Investor C Shares................................... 21,373,710 (2,683,604) 2,410,143 25,335,079
Daily Shares........................................ 38,442 32 82 18
-------------- ------------ --------------- --------------
Net increase/(decrease) in net assets................. 133,772,753 63,756,833 (628,161,250) 245,423,958
NET ASSETS:
Beginning of period................................... 3,968,000,608 417,687,390 3,120,097,100 1,170,783,310
-------------- ------------ --------------- --------------
End of period......................................... $4,101,773,361 $481,444,223 $ 2,491,935,850 $1,416,207,268
============== ============ =============== ==============
Undistributed net investment income at end of
period.............................................. $ -- $ 13,157 $ 10,103 $ 5,737
============== =========== =============== ==============
</TABLE>
- ---------------
(a) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
May 31. The numbers reflected are for the period June 1, 1995 through March
31, 1996.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30. The numbers reflected are for the period December 1, 1995
through March 31, 1996.
SEE NOTES TO FINANCIAL STATEMENTS.
27
<PAGE> 30
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY
Since the Funds have sold, issued as reinvestment of dividends and redeemed
shares only at a constant net asset value of $1.00 per share, the number of
shares represented by such sales, reinvestments and redemptions is the same as
the amounts shown below for such transactions.
<TABLE>
<CAPTION>
NATIONS GOVERNMENT
NATIONS PRIME FUND MONEY MARKET FUND
YEAR ENDED PERIOD ENDED YEAR ENDED PERIOD ENDED
MARCH 31, 1997 MARCH 31, 1996(a) MARCH 31, 1997 MARCH 31, 1996(b)
-----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold................................ $2,571,907,088 $ 2,343,459,930 $ 507,240,424 $ 219,823,787
Issued in exchange for Primary A
Shares of Peachtree:
Prime Fund (Note 7)............... 46,492,996 -- -- --
Government Money Market Fund (Note
7).............................. -- -- 31,480,400 --
Issued as reinvestment of
dividends......................... 852,265 486,972 3,017 --
Redeemed............................ (2,558,045,356) (2,744,598,959) (576,097,351) (215,950,815)
--------------- --------------- ------------- -------------
Net increase/(decrease)............. $ 61,206,993 $ (400,652,057) $ (37,373,510) $ 3,872,972
============== =============== ============= =============
PRIMARY B SHARES:
Sold................................ $1,407,226,085 $ 363,309,249 $ 171,213,079 $ 46,099,378
Issued as reinvestment of
dividends......................... 28,061 -- -- --
Redeemed............................ (1,319,529,776) (393,126,690) (183,344,108) (41,640,533)
--------------- --------------- ------------- -------------
Net increase/(decrease)............. $ 87,724,370 $ (29,817,441) $ (12,131,029) $ 4,458,845
============== =============== ============= =============
INVESTOR A SHARES:
Sold................................ $3,809,109,741 $ 3,357,983,129 $ 87,140,427 $ 60,796,659
Issued as reinvestment of
dividends......................... 51,501,048 37,851,418 1,257,952 766,444
Redeemed............................ (3,802,378,541) (2,994,652,348) (118,425,956) (38,994,060)
--------------- --------------- ------------- -------------
Net increase/(decrease)............. $ 58,232,248 $ 401,182,199 $ (30,027,577) $ 22,569,043
============== =============== ============= =============
INVESTOR B SHARES:
Sold................................ $1,472,078,943 $ 1,738,995,404 $ 259,954,369 $ 111,579,007
Issued as reinvestment of
dividends......................... 13,460,877 9,673,991 1,641,684 617,266
Redeemed............................ (1,463,171,041) (1,606,979,062) (296,466,137) (76,655,070)
--------------- --------------- ------------- -------------
Net increase/(decrease)............. $ 22,368,779 $ 141,690,333 $ (34,870,084) $ 35,541,203
============== =============== ============= =============
INVESTOR C SHARES:
Sold................................ $ 244,058,874 $ 190,895,727 $ 6,143,189 $ 1,909,288
Issued as reinvestment of
dividends......................... 4,008,416 2,613,240 97,541 38,740
Redeemed............................ (229,209,603) (172,135,257) (5,829,293) (4,631,632)
--------------- --------------- ------------- -------------
Net increase/(decrease)............. $ 18,857,687 $ 21,373,710 $ 411,437 $ (2,683,604)
============== =============== ============= =============
DAILY SHARES:
Sold................................ $ 12,949,550 $ 92,585 $ 14,994,192 $ --
Issued as reinvestment of
dividends......................... 47,920 2,069 22,229 32
Redeemed............................ (4,027,111) (56,212) (7,157,510) --
--------------- --------------- ------------- -------------
Net increase........................ $ 8,970,359 $ 38,442 $ 7,858,911 $ 32
============== =============== ============= =============
</TABLE>
- ---------------
(a) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
May 31.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
SEE NOTES TO FINANCIAL STATEMENTS.
28
<PAGE> 31
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
NATIONS TREASURY FUND NATIONS TAX EXEMPT FUND
YEAR ENDED PERIOD ENDED YEAR ENDED PERIOD ENDED
MARCH 31, 1997 MARCH 31, 1996(a) MARCH 31, 1997 MARCH 31, 1996(b)
-----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold............................... $2,911,565,540 $ 4,227,193,042 $1,392,743,346 $ 561,383,700
Issued as reinvestment of
dividends........................ 256,531 10,474 754,137 --
Redeemed........................... (2,387,275,346) (6,302,999,018) (1,287,950,817) (387,745,208)
--------------- --------------- ------------- -------------
Net increase/(decrease)............ $ 524,546,725 $(2,075,795,502) $ 105,546,666 $ 173,638,492
============== =============== ============== =============
PRIMARY B SHARES:
Sold............................... $ 425,279,678 $ 250,262,684 $ 83,563,210 $ 14,219,439
Issued as reinvestment of
dividends........................ 504 -- -- --
Redeemed........................... (417,598,435) (259,589,115) (79,782,747) (16,515,465)
--------------- --------------- ------------- -------------
Net increase/(decrease)............ $ 7,681,747 $ (9,326,431) $ 3,780,463 $ (2,296,026)
============== =============== ============== =============
INVESTOR A SHARES:
Sold............................... $1,502,010,404 $ 355,900,666 $ 430,531,574 $ 116,297,792
Issued as reinvestment of
dividends........................ 4,949,120 4,759,978 3,977,272 1,294,655
Redeemed........................... (877,348,901) (378,549,853) (417,585,134) (115,387,267)
--------------- --------------- ------------- -------------
Net increase/(decrease)............ $ 629,610,623 $ (17,889,209) $ 16,923,712 $ 2,205,180
============== =============== ============== =============
INVESTOR B SHARES:
Sold............................... $8,327,962,057 $ 7,051,467,524 $ 625,042,344 $ 271,059,312
Issued as reinvestment of
dividends........................ 4,638,191 2,333,486 5,290,829 831,949
Redeemed........................... (8,884,357,643) (5,581,314,424) (534,643,222) (225,350,046)
--------------- --------------- ------------- -------------
Net increase/(decrease)............ $ (551,757,395) $ 1,472,486,586 $ 95,689,951 $ 46,541,215
============== =============== ============== =============
INVESTOR C SHARES:
Sold............................... $ 31,620,194 $ 18,619,338 $ 166,459,636 $ 70,804,287
Issued as reinvestment of
dividends........................ 608,852 345,992 1,807,813 569,704
Redeemed........................... (27,144,318) (16,555,187) (172,249,604) (46,038,912)
--------------- --------------- ------------- -------------
Net increase/(decrease)............ $ 5,084,728 $ 2,410,143 $ (3,982,155) $ 25,335,079
============== =============== ============== =============
DAILY SHARES:
Sold............................... $ 35,051,951 $ -- $ 4,211,534 $ --
Issued as reinvestment of
dividends........................ 31,264 82 3,295 18
Redeemed........................... (18,761,946) -- (1,882,639) --
--------------- --------------- ------------- -------------
Net increase....................... $ 16,321,269 $ 82 $ 2,332,190 $ 18
============== =============== ============== =============
</TABLE>
- ---------------
(a) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
May 31.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
SEE NOTES TO FINANCIAL STATEMENTS.
29
<PAGE> 32
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR.
<TABLE>
<CAPTION>
NET
ASSET DIVIDENDS TOTAL
VALUE FROM DIVIDENDS
BEGINNING OF NET INVESTMENT NET INVESTMENT AND
YEAR INCOME INCOME DISTRIBUTIONS
--------------------------------------------------------------------
<S> <C> <C> <C> <C>
NATIONS PRIME FUND
PRIMARY A SHARES
Year ended 03/31/1997........................... $ 1.00 $ 0.0520 $(0.0520) $ (0.0520)
Period ended 03/31/1996(a)...................... 1.00 0.0468 (0.0468) (0.0468)
Year ended 05/31/1995........................... 1.00 0.0519 (0.0519) (0.0519)
Year ended 05/31/1994........................... 1.00 0.0318 (0.0318) (0.0318)
Year ended 05/31/1993........................... 1.00 0.0328 (0.0328) (0.0328)
Year ended 05/31/1992........................... 1.00 0.0506 (0.0506) (0.0506)
Year ended 05/31/1991........................... 1.00 0.0749 (0.0749) (0.0749)
Year ended 05/31/1990........................... 1.00 0.0855 (0.0855) (0.0855)
Year ended 05/31/1989........................... 1.00 0.0839 (0.0839) (0.0839)
Year ended 05/31/1988........................... 1.00 0.0675 (0.0675) (0.0675)
Period ended 05/31/1987*........................ 1.00 0.0277 (0.0277) (0.0277)
PRIMARY B SHARES
Year ended 03/31/1997........................... $ 1.00 $ 0.0495 $(0.0495) $ (0.0495)
Period ended 03/31/1996(a)...................... 1.00 0.0447 (0.0447) (0.0447)
Period ended 05/31/1995*........................ 1.00 0.0474 (0.0474) (0.0474)
INVESTOR A SHARES
Year ended 03/31/1997........................... $ 1.00 $ 0.0485 $(0.0485) $ (0.0485)
Period ended 03/31/1996(a)...................... 1.00 0.0438 (0.0438) (0.0438)
Year ended 05/31/1995........................... 1.00 0.0475 (0.0475) (0.0475)
Year ended 05/31/1994........................... 1.00 0.0283 (0.0283) (0.0283)
Year ended 05/31/1993........................... 1.00 0.0293 (0.0293) (0.0293)
Year ended 05/31/1992........................... 1.00 0.0470 (0.0470) (0.0470)
Period ended 05/31/1991*........................ 1.00 0.0617 (0.0617) (0.0617)
INVESTOR B SHARES
Year ended 03/31/1997........................... $ 1.00 $ 0.0495 $(0.0495) $ (0.0495)
Period ended 03/31/1996(a)...................... 1.00 0.0447 (0.0447) (0.0447)
Year ended 05/31/1995........................... 1.00 0.0493 (0.0493) (0.0493)
Period ended 05/31/1994*........................ 1.00 0.0015 (0.0015) (0.0015)
INVESTOR C SHARES
Year ended 03/31/1997........................... $ 1.00 $ 0.0495 $(0.0495) $ (0.0495)
Period ended 03/31/1996(a)...................... 1.00 0.0447 (0.0447) (0.0447)
Year ended 05/31/1995........................... 1.00 0.0493 (0.0493) (0.0493)
Period ended 05/31/1994*........................ 1.00 0.0155 (0.0155) (0.0155)
DAILY SHARES
Year ended 03/31/1997........................... $ 1.00 $ 0.0470 $(0.0470) $ (0.0470)
Period ended 03/31/1996(a)...................... 1.00 0.0439 (0.0439) (0.0439)
Period ended 05/31/1995*........................ 1.00 0.0173 (0.0173) (0.0173)
</TABLE>
- ---------------
* Nations Prime Fund's Primary A, Primary B, Investor A, Investor B, Investor
C and Daily Shares commenced operations on December 15, 1986, June 16, 1994,
July 16, 1990, May 11, 1994, November 26, 1993 and February 9, 1995,
respectively.
+ Annualized.
++ Total return represents aggregate total return for the period indicated and
does not reflect the deduction of any applicable sales charges.
+++ Unaudited.
(a) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
May 31.
SEE NOTES TO FINANCIAL STATEMENTS.
30
<PAGE> 33
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
NET RATIO OF RATIO OF
ASSET NET ASSETS OPERATING NET INVESTMENT
VALUE END OF EXPENSES TO INCOME TO
END OF TOTAL YEAR AVERAGE NET AVERAGE NET
YEAR RETURN++ (IN 000'S) ASSETS ASSETS
------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
NATIONS PRIME FUND
PRIMARY A SHARES
Year ended 03/31/1997........................... $1.00 5.34% $2,533,688 0.30% 5.21%
Period ended 03/31/1996(a)...................... 1.00 4.79 2,472,469 0.30+ 5.62+
Year ended 05/31/1995........................... 1.00 5.32 2,873,096 0.30 5.23
Year ended 05/31/1994........................... 1.00 3.22 2,883,762 0.30 3.20
Year ended 05/31/1993........................... 1.00 3.33 1,156,266 0.30 3.25
Year ended 05/31/1992........................... 1.00 5.19+++ 500,476 0.30 5.03
Year ended 05/31/1991........................... 1.00 7.75+++ 574,993 0.30 7.47
Year ended 05/31/1990........................... 1.00 8.88+++ 433,298 0.32 8.43
Year ended 05/31/1989........................... 1.00 8.71+++ 115,295 0.35 8.11
Year ended 05/31/1988........................... 1.00 6.94+++ 264,063 0.36 6.73
Period ended 05/31/1987*........................ 1.00 2.79+++ 252,562 0.35+ 5.99+
PRIMARY B SHARES
Year ended 03/31/1997........................... $1.00 5.05% $ 184,021 0.55% 4.96%
Period ended 03/31/1996(a)...................... 1.00 4.57 96,305 0.55+ 5.37+
Period ended 05/31/1995*........................ 1.00 4.84 126,120 0.55+ 4.98+
INVESTOR A SHARES
Year ended 03/31/1997........................... $1.00 4.96% $1,157,724 0.65% 4.86%
Period ended 03/31/1996(a)...................... 1.00 4.48 1,099,490 0.65+ 5.27+
Year ended 05/31/1995........................... 1.00 4.85 698,358 0.75 4.78
Year ended 05/31/1994........................... 1.00 2.86 511,833 0.65 2.85
Year ended 05/31/1993........................... 1.00 2.97 306,376 0.65 2.90
Year ended 05/31/1992........................... 1.00 4.81+++ 281,101 0.65 4.67
Period ended 05/31/1991*........................ 1.00 7.31+++ 144,202 0.65+ 6.69+
INVESTOR B SHARES
Year ended 03/31/1997........................... $1.00 5.05% $ 381,015 0.55% 4.96%
Period ended 03/31/1996(a)...................... 1.00 4.57 358,646 0.55+ 5.37+
Year ended 05/31/1995........................... 1.00 5.03 216,973 0.56 4.97
Period ended 05/31/1994*........................ 1.00 0.15 2 0.55+ 2.95+
INVESTOR C SHARES
Year ended 03/31/1997........................... $1.00 5.05% $ 93,678 0.55% 4.96%
Period ended 03/31/1996(a)...................... 1.00 4.57 74,822 0.55+ 5.37+
Year ended 05/31/1995........................... 1.00 5.03 53,451 0.56 4.97
Period ended 05/31/1994*........................ 1.00 1.58 1,481 0.55+ 2.95+
DAILY SHARES
Year ended 03/31/1997........................... $1.00 4.80% $ 9,010 0.80% 4.71%
Period ended 03/31/1996(a)...................... 1.00 4.49 40 0.67+ 5.25+
Period ended 05/31/1995*........................ 1.00 1.74 2 0.55+ 4.98+
</TABLE>
<TABLE>
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
------------------------------
RATIO OF
OPERATING
EXPENSES TO NET INVESTMENT
AVERAGE NET INCOME
ASSETS PER SHARE
-------------------------------
<S> <C> <C>
NATIONS PRIME FUND
PRIMARY A SHARES
Year ended 03/31/1997........................... 0.35% $ 0.0516
Period ended 03/31/1996(a)...................... 0.37+ 0.0463
Year ended 05/31/1995........................... 0.38 0.0511
Year ended 05/31/1994........................... 0.37 0.0311
Year ended 05/31/1993........................... 0.36 0.0322
Year ended 05/31/1992........................... 0.42 0.0494
Year ended 05/31/1991........................... 0.44 0.0735
Year ended 05/31/1990........................... 0.50+++ 0.0731+++
Year ended 05/31/1989........................... 0.55+++ 0.0819+++
Year ended 05/31/1988........................... 0.56+++ 0.0655+++
Period ended 05/31/1987*........................ 0.65+/+++ 0.0247+++
PRIMARY B SHARES
Year ended 03/31/1997........................... 0.60% $ 0.0491
Period ended 03/31/1996(a)...................... 0.62+ 0.0442
Period ended 05/31/1995*........................ 0.63+ 0.0466
INVESTOR A SHARES
Year ended 03/31/1997........................... 0.70% $ 0.0481
Period ended 03/31/1996(a)...................... 0.72+ 0.0433
Year ended 05/31/1995........................... 0.83 0.0467
Year ended 05/31/1994........................... 0.72 0.0276
Year ended 05/31/1993........................... 0.71 0.0287
Year ended 05/31/1992........................... 0.77 0.0458
Period ended 05/31/1991*........................ 0.79+ 0.0603
INVESTOR B SHARES
Year ended 03/31/1997........................... 0.60% $ 0.0491
Period ended 03/31/1996(a)...................... 0.62+ 0.0442
Year ended 05/31/1995........................... 0.64 0.0485
Period ended 05/31/1994*........................ 0.62+ 0.0015
INVESTOR C SHARES
Year ended 03/31/1997........................... 0.60% $ 0.0491
Period ended 03/31/1996(a)...................... 0.62+ 0.0442
Year ended 05/31/1995........................... 0.64 0.0485
Period ended 05/31/1994*........................ 0.62+ 0.0151
DAILY SHARES
Year ended 03/31/1997........................... 0.85% $ 0.0466
Period ended 03/31/1996(a)...................... 0.74+ 0.0434
Period ended 05/31/1995*........................ 0.63+ 0.0165
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
31
<PAGE> 34
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR.
<TABLE>
<CAPTION>
NET
ASSET DIVIDENDS DISTRIBUTIONS
VALUE FROM FROM
BEGINNING OF NET INVESTMENT NET INVESTMENT NET REALIZED
YEAR INCOME INCOME CAPITAL GAINS
---------------------------------------------------------------------
<S> <C> <C> <C> <C>
NATIONS GOVERNMENT MONEY MARKET FUND
PRIMARY A SHARES
Year ended 03/31/1997........................... $ 1.00 $0.0503 $(0.0503) --
Period ended 03/31/1996(a)...................... 1.00 0.0173 (0.0173) --
Year ended 11/30/1995........................... 1.00 0.0558 (0.0558) --
Year ended 11/30/1994........................... 1.00 0.0375 (0.0375) $ (0.0000)#
Year ended 11/30/1993........................... 1.00 0.0294 (0.0294) --
Year ended 11/30/1992........................... 1.00 0.0358 (0.0358) --
Period ended 11/30/1991*........................ 1.00 0.0571 (0.0571) --
PRIMARY B SHARES
Year ended 03/31/1997........................... $ 1.00 $0.0478 $(0.0478) --
Period ended 03/31/1996(a)...................... 1.00 0.0165 (0.0165) --
Year ended 11/30/1995........................... 1.00 0.0533 (0.0533) --
Period ended 11/30/1994*........................ 1.00 0.0200 (0.0200) $ (0.0000)#
INVESTOR A SHARES
Year ended 03/31/1997........................... $ 1.00 $0.0468 $(0.0468) --
Period ended 03/31/1996(a)...................... 1.00 0.0162 (0.0162) --
Year ended 11/30/1995........................... 1.00 0.0522 (0.0522) --
Year ended 11/30/1994........................... 1.00 0.0340 (0.0340) $ (0.0000)#
Year ended 11/30/1993........................... 1.00 0.0256 (0.0256) --
Year ended 11/30/1992........................... 1.00 0.0358 (0.0358) --
Period ended 11/30/1991*........................ 1.00 0.0571 (0.0571) --
INVESTOR B SHARES
Year ended 03/31/1997........................... $ 1.00 $0.0478 $(0.0478) --
Period ended 03/31/1996(a)...................... 1.00 0.0165 (0.0165) --
Year ended 11/30/1995........................... 1.00 0.0532 (0.0532) --
Period ended 11/30/1994*........................ 1.00 0.0222 (0.0222) $ (0.0000)#
INVESTOR C SHARES
Year ended 03/31/1997........................... $ 1.00 $0.0478 $(0.0478) --
Period ended 03/31/1996(a)...................... 1.00 0.0165 (0.0165) --
Year ended 11/30/1995........................... 1.00 0.0532 (0.0532) --
Period ended 11/30/1994*........................ 1.00 0.0290 (0.0290) $ (0.0000)#
DAILY SHARES
Year ended 03/31/1997........................... $ 1.00 $0.0453 $(0.0453) --
Period ended 03/31/1996(a)...................... 1.00 0.0157 (0.0157) --
Period ended 11/30/1995*........................ 1.00 0.0418 (0.0418) --
<CAPTION>
TOTAL
DIVIDENDS
AND
DISTRIBUTIONS
---------------------------------------------------------------------
<S> <C>
NATIONS GOVERNMENT MONEY MARKET FUND
PRIMARY A SHARES
Year ended 03/31/1997........................... $ (0.0503)
Period ended 03/31/1996(a)...................... (0.0173)
Year ended 11/30/1995........................... (0.0558)
Year ended 11/30/1994........................... (0.0375)
Year ended 11/30/1993........................... (0.0294)
Year ended 11/30/1992........................... (0.0358)
Period ended 11/30/1991*........................ (0.0571)
PRIMARY B SHARES
Year ended 03/31/1997........................... $ (0.0478)
Period ended 03/31/1996(a)...................... (0.0165)
Year ended 11/30/1995........................... (0.0533)
Period ended 11/30/1994*........................ (0.0200)
INVESTOR A SHARES
Year ended 03/31/1997........................... $ (0.0468)
Period ended 03/31/1996(a)...................... (0.0162)
Year ended 11/30/1995........................... (0.0522)
Year ended 11/30/1994........................... (0.0340)
Year ended 11/30/1993........................... (0.0256)
Year ended 11/30/1992........................... (0.0358)
Period ended 11/30/1991*........................ (0.0571)
INVESTOR B SHARES
Year ended 03/31/1997........................... $ (0.0478)
Period ended 03/31/1996(a)...................... (0.0165)
Year ended 11/30/1995........................... (0.0532)
Period ended 11/30/1994*........................ (0.0222)
INVESTOR C SHARES
Year ended 03/31/1997........................... $ (0.0478)
Period ended 03/31/1996(a)...................... (0.0165)
Year ended 11/30/1995........................... (0.0532)
Period ended 11/30/1994*........................ (0.0290)
DAILY SHARES
Year ended 03/31/1997........................... $ (0.0453)
Period ended 03/31/1996(a)...................... (0.0157)
Period ended 11/30/1995*........................ (0.0418)
</TABLE>
- ---------------
* Nations Government Money Market Fund's Primary A, Primary B, Investor A,
Investor B, Investor C and Daily Shares commenced operations on December 3,
1990, June 16, 1994, February 11, 1991, May 17, 1994, March 21, 1994 and
February 10, 1995, respectively.
+ Annualized.
++ Total return represents aggregate total return for the period indicated and
does not reflect the deduction of any applicable sales charges.
+++ Unaudited.
# Amount represents less than $0.0001 per share.
(a) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
SEE NOTES TO FINANCIAL STATEMENTS.
32
<PAGE> 35
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
NET RATIO OF RATIO OF
ASSET NET ASSETS OPERATING NET INVESTMENT
VALUE END OF EXPENSES TO INCOME TO
END OF TOTAL YEAR AVERAGE NET AVERAGE NET
YEAR RETURN++ (IN 000'S) ASSETS ASSETS
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
NATIONS GOVERNMENT MONEY MARKET FUND
PRIMARY A SHARES
Year ended 03/31/1997.................. $1.00 5.18% $299,394 0.30% 5.03%
Period ended 03/31/1996(a)............. 1.00 1.74 336,771 0.30+ 5.20+
Year ended 11/30/1995.................. 1.00 5.72 332,895 0.30 5.58
Year ended 11/30/1994.................. 1.00 3.84 432,729 0.30 3.79
Year ended 11/30/1993.................. 1.00 2.96 475,180 0.30 2.91
Year ended 11/30/1992.................. 1.00 3.63+++ 414,412 0.42 3.55
Period ended 11/30/1991*............... 1.00 5.87+++ 333,979 0.43+ 5.49+
PRIMARY B SHARES
Year ended 03/31/1997.................. $1.00 4.93% $ 19,450 0.55% 4.78%
Period ended 03/31/1996(a)............. 1.00 1.66 31,581 0.55+ 4.95+
Year ended 11/30/1995.................. 1.00 5.45 27,122 0.55 5.33
Period ended 11/30/1994*............... 1.00 2.02 72,747 0.55+ 3.54+
INVESTOR A SHARES
Year ended 03/31/1997.................. $1.00 4.80% $ 18,717 0.65% 4.68%
Period ended 03/31/1996(a)............. 1.00 1.62 48,742 0.65+ 4.85+
Year ended 11/30/1995.................. 1.00 5.34 26,175 0.65 5.23
Year ended 11/30/1994.................. 1.00 3.45 20,173 0.65 3.44
Year ended 11/30/1993.................. 1.00 2.60 10,499 0.61 2.60
Year ended 11/30/1992.................. 1.00 3.63+++ 13,851 0.42 3.55
Period ended 11/30/1991*............... 1.00 5.86+++ 8,949 0.43+ 5.49+
INVESTOR B SHARES
Year ended 03/31/1997.................. $1.00 4.93% $ 27,750 0.55% 4.78%
Period ended 03/31/1996(a)............. 1.00 1.66 62,617 0.55+ 4.95+
Year ended 11/30/1995.................. 1.00 5.45 27,079 0.55 5.33
Period ended 11/30/1994*............... 1.00 2.24 11,955 0.55+ 3.54+
INVESTOR C SHARES
Year ended 03/31/1997.................. $1.00 4.93% $ 2,142 0.55% 4.78%
Period ended 03/31/1996(a)............. 1.00 1.66 1,731 0.55+ 4.95+
Year ended 11/30/1995.................. 1.00 5.44 4,414 0.55 5.33
Period ended 11/30/1994*............... 1.00 2.94 476 0.55+ 3.54+
DAILY SHARES
Year ended 03/31/1997.................. $1.00 4.63% $ 7,860 0.80% 4.53%
Period ended 03/31/1996(a)............. 1.00 1.58 2 0.71+ 4.79+
Period ended 11/30/1995*............... 1.00 4.38 2 0.55+ 5.33+
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
------------------------------
RATIO OF
OPERATING
EXPENSES TO NET INVESTMENT
AVERAGE NET INCOME
ASSETS PER SHARE
- -----------------------------------------------------------------------
<S> <C> <C>
NATIONS GOVERNMENT MONEY MARKET FUND
PRIMARY A SHARES
Year ended 03/31/1997.................. 0.57% $ 0.0476
Period ended 03/31/1996(a)............. 0.59+ 0.0163
Year ended 11/30/1995.................. 0.57 0.0531
Year ended 11/30/1994.................. 0.59 0.0347
Year ended 11/30/1993.................. 0.56 0.0269
Year ended 11/30/1992.................. 0.58 0.0341
Period ended 11/30/1991*............... 0.62+ 0.0551
PRIMARY B SHARES
Year ended 03/31/1997.................. 0.82% $ 0.0451
Period ended 03/31/1996(a)............. 0.84+ 0.0155
Year ended 11/30/1995.................. 0.82 0.0506
Period ended 11/30/1994*............... 0.84+ 0.0186
INVESTOR A SHARES
Year ended 03/31/1997.................. 0.92% $ 0.0441
Period ended 03/31/1996(a)............. 0.94+ 0.0152
Year ended 11/30/1995.................. 0.92 0.0495
Year ended 11/30/1994.................. 0.94 0.0311
Year ended 11/30/1993.................. 0.87 0.0231
Year ended 11/30/1992.................. 0.58 0.0341
Period ended 11/30/1991*............... 0.62+ 0.0551
INVESTOR B SHARES
Year ended 03/31/1997.................. 0.82% $ 0.0451
Period ended 03/31/1996(a)............. 0.84+ 0.0155
Year ended 11/30/1995.................. 0.82 0.0505
Peiod ended 11/30/1994*................ 0.84+ 0.0206
INVESTOR C SHARES
Year ended 03/31/1997.................. 0.82% $ 0.0451
Period ended 03/31/1996(a)............. 0.84+ 0.0155
Year ended 11/30/1995.................. 0.82 0.0505
Period ended 11/30/1994*............... 0.84+ 0.0268
DAILY SHARES
Year ended 03/31/1997.................. 1.07% $ 0.0426
Period ended 03/31/1996(a)............. 1.00+ 0.0147
Period ended 11/30/1995*............... 0.82% 0.0397
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
33
<PAGE> 36
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR.
<TABLE>
<CAPTION>
NET
ASSET DIVIDENDS DISTRIBUTIONS
VALUE FROM FROM
BEGINNING OF NET INVESTMENT NET INVESTMENT NET REALIZED
YEAR INCOME INCOME CAPITAL GAINS
---------------------------------------------------------------------
<S> <C> <C> <C> <C>
NATIONS TREASURY FUND
PRIMARY A SHARES
Year ended 03/31/1997........................... $1.00 $0.0509 $(0.0509) --
Period ended 03/31/1996(a)...................... 1.00 0.0458 (0.0458) $(0.0000)#
Year ended 05/31/1995........................... 1.00 0.0494 (0.0494) (0.0000)#
Year ended 05/31/1994........................... 1.00 0.0297 (0.0297) --
Year ended 05/31/1993........................... 1.00 0.0307 (0.0307) --
Year ended 05/31/1992........................... 1.00 0.0483 (0.0483) --
Year ended 05/31/1991........................... 1.00 0.0721 (0.0721) --
Year ended 05/31/1990........................... 1.00 0.0829 (0.0829) --
Year ended 05/31/1989........................... 1.00 0.0802 (0.0802) --
Year ended 05/31/1988........................... 1.00 0.0630 (0.0630) --
Period ended 05/31/1987*........................ 1.00 0.0262 (0.0262) --
PRIMARY B SHARES
Year ended 03/31/1997........................... $1.00 $0.0484 $(0.0484) --
Period ended 03/31/1996(a)...................... 1.00 0.0437 (0.0437) $(0.0000)#
Period ended 05/31/1995*........................ 1.00 0.0449 (0.0449) (0.0000)#
INVESTOR A SHARES
Year ended 03/31/1997........................... $1.00 $0.0474 $(0.0474) --
Period ended 03/31/1996(a)...................... 1.00 0.0429 (0.0429) $(0.0000)#
Year ended 05/31/1995........................... 1.00 0.0457 (0.0457) (0.0000)#
Year ended 05/31/1994........................... 1.00 0.0262 (0.0262) --
Year ended 05/31/1993........................... 1.00 0.0272 (0.0272) --
Year ended 05/31/1992........................... 1.00 0.0448 (0.0448) --
Period ended 05/31/1991*........................ 1.00 0.0592 (0.0592) --
INVESTOR B SHARES
Year ended 03/31/1997........................... $1.00 $0.0484 $(0.0484) --
Period ended 03/31/1996(a)...................... 1.00 0.0437 (0.0437) $(0.0000)#
Year ended 05/31/1995........................... 1.00 0.0468 (0.0468) (0.0000)#
Period ended 05/31/1994*........................ 1.00 0.0015 (0.0015) --
INVESTOR C SHARES
Year ended 03/31/1997........................... $1.00 $0.0484 $(0.0484) --
Period ended 03/31/1996(a)...................... 1.00 0.0437 (0.0437) $(0.0000)#
Year ended 05/31/1995........................... 1.00 0.0468 (0.0468) (0.0000)#
Period ended 05/31/1994*........................ 1.00 0.0019 (0.0019) --
DAILY SHARES
Year ended 03/31/1997........................... $1.00 $0.0455 $(0.0455) --
Period ended 03/31/1996(a)...................... 1.00 0.0404 (0.0404) --
Period ended 05/31/1995*........................ 1.00 0.0167 (0.0167) --
<CAPTION>
TOTAL
DIVIDENDS
AND
DISTRIBUTIONS
---------------------------------------------------------------------
<S> <C>
NATIONS TREASURY FUND
PRIMARY A SHARES
Year ended 03/31/1997........................... $(0.0509)
Period ended 03/31/1996(a)...................... (0.0458)
Year ended 05/31/1995........................... (0.0494)
Year ended 05/31/1994........................... (0.0297)
Year ended 05/31/1993........................... (0.0307)
Year ended 05/31/1992........................... (0.0483)
Year ended 05/31/1991........................... (0.0721)
Year ended 05/31/1990........................... (0.0829)
Year ended 05/31/1989........................... (0.0802)
Year ended 05/31/1988........................... (0.0630)
Period ended 05/31/1987*........................ (0.0262)
PRIMARY B SHARES
Year ended 03/31/1997........................... $(0.0484)
Period ended 03/31/1996(a)...................... (0.0437)
Period ended 05/31/1995*........................ (0.0449)
INVESTOR A SHARES
Year ended 03/31/1997........................... $(0.0474)
Period ended 03/31/1996(a)...................... (0.0429)
Year ended 05/31/1995........................... (0.0457)
Year ended 05/31/1994........................... (0.0262)
Year ended 05/31/1993........................... (0.0272)
Year ended 05/31/1992........................... (0.0448)
Period ended 05/31/1991*........................ (0.0592)
INVESTOR B SHARES
Year ended 03/31/1997........................... $(0.0484)
Period ended 03/31/1996(a)...................... (0.0437)
Year ended 05/31/1995........................... (0.0468)
Period ended 05/31/1994*........................ (0.0015)
INVESTOR C SHARES
Year ended 03/31/1997........................... $(0.0484)
Period ended 03/31/1996(a)...................... (0.0437)
Year ended 05/31/1995........................... (0.0468)
Period ended 05/31/1994*........................ (0.0019)
DAILY SHARES
Year ended 03/31/1997........................... $(0.0455)
Period ended 03/31/1996(a)...................... (0.0404)
Period ended 05/31/1995*........................ (0.0167)
</TABLE>
- ---------------
* Nations Treasury Fund's Primary A, Primary B, Investor A, Investor B,
Investor C and Daily Shares commenced operations on December 15, 1986, June
16, 1994, July 16, 1990, May 16, 1994, May 11, 1994 and February 9, 1995,
respectively.
+ Annualized.
++ Total return represents aggregate total return for the period indicated and
does not reflect the deduction of any applicable sales charges.
+++ Unaudited.
# Amount represents less than $0.0001 per share.
(a) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
May 31.
SEE NOTES TO FINANCIAL STATEMENTS.
34
<PAGE> 37
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
NET RATIO OF RATIO OF
ASSET NET ASSETS OPERATING NET INVESTMENT
VALUE END OF EXPENSES TO INCOME TO
END OF TOTAL YEAR AVERAGE NET AVERAGE NET
YEAR RETURN++ (IN 000'S) ASSETS ASSETS
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
NATIONS TREASURY FUND
PRIMARY A SHARES
Year ended 03/31/1997........................... $1.00 5.22% $1,345,585 0.30% 5.09%
Period ended 03/31/1996(a)...................... 1.00 4.67 821,030 0.30+ 5.52+
Year ended 05/31/1995........................... 1.00 5.05 2,896,868 0.30 4.99
Year ended 05/31/1994........................... 1.00 2.99 2,679,992 0.30 2.97
Year ended 05/31/1993........................... 1.00 3.12 2,956,796 0.30 3.02
Year ended 05/31/1992........................... 1.00 4.95+++ 1,094,741 0.29 4.82
Year ended 05/31/1991........................... 1.00 7.46+++ 955,186 0.25 7.04
Year ended 05/31/1990........................... 1.00 8.61+++ 392,843 0.25 8.18
Year ended 05/31/1989........................... 1.00 8.33+++ 90,946 0.39 7.93
Year ended 05/31/1988........................... 1.00 6.49+++ 111,414 0.38 6.31
Period ended 05/31/1987*........................ 1.00 2.64+++ 66,221 0.35+ 5.68+
PRIMARY B SHARES
Year ended 03/31/1997........................... $1.00 4.96% $ 55,170 0.55% 4.84%
Period ended 03/31/1996(a)...................... 1.00 4.46 47,488 0.55+ 5.27+
Period ended 05/31/1995*........................ 1.00 4.56 56,815 0.55+ 4.74+
INVESTOR A SHARES
Year ended 03/31/1997........................... $1.00 4.85% $ 719,199 0.65% 4.74%
Period ended 03/31/1996(a)...................... 1.00 4.36 89,584 0.65+ 5.17+
Year ended 05/31/1995........................... 1.00 4.65 107,475 0.67 4.62
Year ended 05/31/1994........................... 1.00 2.67 74,195 0.65 2.62
Year ended 05/31/1993........................... 1.00 2.77 105,828 0.65 2.67
Year ended 05/31/1992........................... 1.00 4.57+++ 90,917 0.64 4.47
Period ended 05/31/1991*........................ 1.00 6.98+++ 37,265 0.61+ 6.53+
INVESTOR B SHARES
Year ended 03/31/1997........................... $1.00 4.96% $ 973,297 0.55% 4.84%
Period ended 03/31/1996(a)...................... 1.00 4.46 1,525,048 0.55+ 5.27+
Year ended 05/31/1995........................... 1.00 4.76 52,564 0.56 4.73
Period ended 05/31/1994*........................ 1.00 0.14 2 0.55+ 2.72+
INVESTOR C SHARES
Year ended 03/31/1997........................... $1.00 4.96% $ 13,868 0.55% 4.84%
Period ended 03/31/1996(a)...................... 1.00 4.46 8,783 0.55+ 5.27+
Year ended 05/31/1995........................... 1.00 4.76 6,373 0.56 4.73
Period ended 05/31/1994*........................ 1.00 0.19 191 0.55+ 2.72+
DAILY SHARES
Year ended 03/31/1997........................... $1.00 4.66% $ 16,323 0.80% 4.59%
Period ended 03/31/1996(a)...................... 1.00 4.09 2 0.64+ 5.18+
Period ended 05/31/1995*........................ 1.00 1.67 2 0.55+ 4.74+
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
------------------------------
RATIO OF
OPERATING
EXPENSES TO NET INVESTMENT
AVERAGE NET INCOME
ASSETS PER SHARE
------------------------------
<S> <C> <C>
NATIONS TREASURY FUND
PRIMARY A SHARES
Year ended 03/31/1997........................... 0.35% $0.0504
Period ended 03/31/1996(a)...................... 0.37+ 0.0453
Year ended 05/31/1995........................... 0.35 0.0489
Year ended 05/31/1994........................... 0.36 0.0292
Year ended 05/31/1993........................... 0.36 0.0302
Year ended 05/31/1992........................... 0.42 0.0470
Year ended 05/31/1991........................... 0.43 0.0703
Year ended 05/31/1990........................... 0.59+++ 0.0693+++
Year ended 05/31/1989........................... 0.58+++ 0.0783+++
Year ended 05/31/1988........................... 0.65+++ 0.0603+++
Period ended 05/31/1987*........................
PRIMARY B SHARES 0.75+/+++ 0.0222+++
Year ended 03/31/1997........................... 0.60% $0.0479
Period ended 03/31/1996(a)...................... 0.62+ 0.0432
Period ended 05/31/1995*........................ 0.60+ 0.0444
INVESTOR A SHARES
Year ended 03/31/1997........................... 0.70% $0.0469
Period ended 03/31/1996(a)...................... 0.72+ 0.0424
Year ended 05/31/1995........................... 0.72 0.0452
Year ended 05/31/1994........................... 0.71 0.0257
Year ended 05/31/1993........................... 0.71 0.0266
Year ended 05/31/1992........................... 0.76 0.0435
Period ended 05/31/1991*........................ 0.83+ 0.0570
INVESTOR B SHARES
Year ended 03/31/1997........................... 0.60% $0.0479
Period ended 03/31/1996(a)...................... 0.62+ 0.0432
Year ended 05/31/1995........................... 0.61 0.0463
Period ended 05/31/1994*........................ 0.61+ 0.0014
INVESTOR C SHARES
Year ended 03/31/1997........................... 0.60% $0.0479
Period ended 03/31/1996(a)...................... 0.62+ 0.0432
Year ended 05/31/1995........................... 0.61 0.0463
Period ended 05/31/1994*........................ 0.61+ 0.0019
DAILY SHARES
Year ended 03/31/1997........................... 0.85% $0.0450
Period ended 03/31/1996(a)...................... 0.71+ 0.0399
Period ended 05/31/1995*........................ 0.60+ 0.0162
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
35
<PAGE> 38
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH YEAR.
<TABLE>
<CAPTION>
NET
ASSET TOTAL
VALUE DIVIDENDS FROM DIVIDENDS
BEGINNING OF NET INVESTMENT NET INVESTMENT AND
YEAR INCOME INCOME DISTRIBUTIONS
--------------------------------------------------------------------
<S> <C> <C> <C> <C>
NATIONS TAX EXEMPT FUND
PRIMARY A SHARES
Year ended 03/31/1997........................... $1.00 $0.0324 $(0.0324) $(0.0324)
Period ended 03/31/1996(a)...................... 1.00 0.0112 (0.0112) (0.0112)
Year ended 11/30/1995........................... 1.00 0.0361 (0.0361) (0.0361)
Year ended 11/30/1994........................... 1.00 0.0257 (0.0257) (0.0257)
Year ended 11/30/1993........................... 1.00 0.0223 (0.0223) (0.0223)
Year ended 11/30/1992........................... 1.00 0.0267 (0.0267) (0.0267)
Year ended 11/30/1991........................... 1.00 0.0422 (0.0422) (0.0422)
Year ended 11/30/1990........................... 1.00 0.0550 (0.0550) (0.0550)
Year ended 11/30/1989........................... 1.00 0.0600 (0.0600) (0.0600)
Period ended 11/30/1988*........................ 1.00 0.0350 (0.0350) (0.0350)
PRIMARY B SHARES
Year ended 03/31/1997........................... $1.00 $0.0300 $(0.0300) $(0.0300)
Period ended 03/31/1996(a)...................... 1.00 0.0104 (0.0104) (0.0104)
Year ended 11/30/1995........................... 1.00 0.0335 (0.0335) (0.0335)
Period ended 11/30/1994*........................ 1.00 0.0116 (0.0116) (0.0116)
INVESTOR A SHARES
Year ended 03/31/1997........................... $1.00 $0.0300 $(0.0300) $(0.0300)
Period ended 03/31/1996(a)...................... 1.00 0.0104 (0.0104) (0.0104)
Year ended 11/30/1995........................... 1.00 0.0335 (0.0335) (0.0335)
Year ended 11/30/1994........................... 1.00 0.0231 (0.0231) (0.0231)
Year ended 11/30/1993........................... 1.00 0.0198 (0.0198) (0.0198)
Year ended 11/30/1992........................... 1.00 0.0266 (0.0266) (0.0266)
Period ended 11/30/1991*........................ 1.00 0.0422 (0.0422) (0.0422)
INVESTOR B SHARES
Year ended 03/31/1997........................... $1.00 $0.0307 $(0.0307) $(0.0307)
Period ended 03/31/1996(a)...................... 1.00 0.0106 (0.0106) (0.0106)
Year ended 11/30/1995........................... 1.00 0.0342 (0.0342) (0.0342)
Period ended 11/30/1994*........................ 1.00 0.0141 (0.0141) (0.0141)
INVESTOR C SHARES
Year ended 03/31/1997........................... $1.00 $0.0311 $(0.0311) $(0.0311)
Period ended 03/31/1996(a)...................... 1.00 0.0107 (0.0107) (0.0107)
Year ended 11/30/1995........................... 1.00 0.0346 (0.0346) (0.0346)
Period ended 11/30/1994*........................ 1.00 0.0203 (0.0203) (0.0203)
DAILY SHARES
Year ended 03/31/1997........................... $1.00 $0.0270 $(0.0270) $(0.0270)
Period ended 03/31/1996(a)...................... 1.00 0.0090 (0.0090) (0.0090)
Period ended 11/30/1995*........................ 1.00 0.0243 (0.0243) (0.0243)
</TABLE>
- ---------------
* Nations Tax Exempt Fund's Primary A, Primary B, Investor A, Investor B,
Investor C and Daily Shares commenced operations on March 14, 1988, June 16,
1994, April 5, 1991, May 17, 1994, March 7, 1994 and February 10, 1995,
respectively.
+ Annualized.
++ Total return represents aggregate total return for the period indicated and
does not reflect the deduction of any applicable sales charges.
+++ Unaudited.
(a) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
SEE NOTES TO FINANCIAL STATEMENTS.
36
<PAGE> 39
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
NET RATIO OF RATIO OF
ASSET NET ASSETS OPERATING NET INVESTMENT
VALUE END OF EXPENSES TO INCOME TO
END OF TOTAL YEAR AVERAGE NET AVERAGE NET
YEAR RETURN++ (IN 000'S) ASSETS ASSETS
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
NATIONS TAX EXEMPT FUND
PRIMARY A SHARES
Year ended 03/31/1997........................... $1.00 3.29% $1,184,313 0.30% 3.25%
Period ended 03/31/1996(a)...................... 1.00 1.12 1,078,764 0.30+ 3.35+
Year ended 11/30/1995........................... 1.00 3.68 905,125 0.30 3.62
Year ended 11/30/1994........................... 1.00 2.60 820,677 0.27 2.59
Year ended 11/30/1993........................... 1.00 2.27 701,403 0.23 2.23
Year ended 11/30/1992........................... 1.00 2.70+++ 329,265 0.40 2.65
Year ended 11/30/1991........................... 1.00 4.31+++ 168,829 0.42 4.23
Year ended 11/30/1990........................... 1.00 5.63+++ 173,834 0.40 5.51
Year ended 11/30/1989........................... 1.00 6.17+++ 145,109 0.40 6.00
Period ended 11/30/1988*........................ 1.00 3.55+++ 143,245 0.40+ 4.97+
PRIMARY B SHARES
Year ended 03/31/1997........................... $1.00 3.04% $ 13,151 0.55% 3.00%
Period ended 03/31/1996(a)...................... 1.00 1.04 9,370 0.55+ 3.10+
Year ended 11/30/1995........................... 1.00 3.39 11,666 0.55 3.37
Period ended 11/30/1994*........................ 1.00 1.17 18,207 0.52+ 2.34+
INVESTOR A SHARES
Year ended 03/31/1997........................... $1.00 3.04% $ 145,337 0.55% 3.00%
Period ended 03/31/1996(a)...................... 1.00 1.04 128,414 0.55+ 3.10+
Year ended 11/30/1995........................... 1.00 3.40 126,207 0.55 3.37
Year ended 11/30/1994........................... 1.00 2.36 151,714 0.52 2.34
Year ended 11/30/1993........................... 1.00 2.00 119,552 0.48 1.98
Year ended 11/30/1992........................... 1.00 2.68+++ 80,158 0.55 2.50
Period ended 11/30/1991*........................ 1.00 4.30+++ 1,690 0.42+ 4.23+
INVESTOR B SHARES
Year ended 03/31/1997........................... $1.00 3.11% $ 228,601 0.50% 3.05%
Period ended 03/31/1996(a)...................... 1.00 1.06 132,914 0.50+ 3.15+
Year ended 11/30/1995........................... 1.00 3.47 86,374 0.50 3.42
Period ended 11/30/1994*........................ 1.00 1.43 3 0.47+ 2.39+
INVESTOR C SHARES
Year ended 03/31/1997........................... $1.00 3.15% $ 62,761 0.45% 3.10%
Period ended 03/31/1996(a)...................... 1.00 1.07 66,743 0.45+ 3.20+
Year ended 11/30/1995........................... 1.00 3.52 41,409 0.45 3.47
Period ended 11/30/1994*........................ 1.00 2.05 25,704 0.42+ 2.44+
DAILY SHARES
Year ended 03/31/1997........................... $1.00 2.73% $ 2,334 0.80% 2.75%
Period ended 03/31/1996(a)...................... 1.00 0.91 2 0.69+ 2.96+
Period ended 11/30/1995*........................ 1.00 2.61 2 0.45+ 3.47+
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
----------------------------
RATIO OF
OPERATING
EXPENSES TO NET INVESTMENT
AVERAGE NET INCOME
ASSETS PER SHARE
- -----------------------------------------------------------------------------
<S> <C> <C>
NATIONS TAX EXEMPT FUND
PRIMARY A SHARES
Year ended 03/31/1997........................... 0.55% $ 0.0298
Period ended 03/31/1996(a)...................... 0.58+ 0.0103
Year ended 11/30/1995........................... 0.57 0.0335
Year ended 11/30/1994........................... 0.59 0.0226
Year ended 11/30/1993........................... 0.59 0.0187
Year ended 11/30/1992........................... 0.57 0.0250
Year ended 11/30/1991........................... 0.60 0.0404
Year ended 11/30/1990........................... 0.75 0.0515
Year ended 11/30/1989........................... 0.74 0.0566
Period ended 11/30/1988*........................ 0.75+ 0.0325
PRIMARY B SHARES
Year ended 03/31/1997........................... 0.80% $ 0.0274
Period ended 03/31/1996(a)...................... 0.83+ 0.0095
Year ended 11/30/1995........................... 0.82 0.0309
Period ended 11/30/1994*........................ 0.84+ 0.0102
INVESTOR A SHARES
Year ended 03/31/1997........................... 0.80% $ 0.0274
Period ended 03/31/1996(a)...................... 0.83+ 0.0095
Year ended 11/30/1995........................... 0.82 0.0309
Year ended 11/30/1994........................... 0.84 0.0199
Year ended 11/30/1993........................... 0.84 0.0162
Year ended 11/30/1992........................... 0.72 0.0248
Period ended 11/30/1991*........................ 0.60+ 0.0404
INVESTOR B SHARES
Year ended 03/31/1997........................... 0.75% $ 0.0281
Period ended 03/31/1996(a)...................... 0.78+ 0.0097
Year ended 11/30/1995........................... 0.77 0.0316
Period ended 11/30/1994*........................ 0.79+ 0.0118
INVESTOR C SHARES
Year ended 03/31/1997........................... 0.70% $ 0.0285
Period ended 03/31/1996(a)...................... 0.73+ 0.0098
Year ended 11/30/1995........................... 0.72 0.0320
Period ended 11/30/1994*........................ 0.74+ 0.0177
DAILY SHARES
Year ended 03/31/1997........................... 1.05% $ 0.0244
Period ended 03/31/1996(a)...................... 0.97+ 0.0081
Period ended 11/30/1995*........................ 0.72+ 0.0225
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
37
<PAGE> 40
NATIONS FUNDS
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
Nations Fund Trust (the "Trust") and Nations Fund, Inc. (the "Company") are
registered under the Investment Company Act of 1940, as amended, (the "1940
Act") as open-end investment companies. As of the date of this report, the Trust
offers thirty-three separate portfolios and the Company offers five separate
portfolios. Information presented in these financial statements pertains only
to: Nations Prime Fund, Nations Government Money Market Fund, Nations Treasury
Fund and Nations Tax Exempt Fund (each a "Fund" and collectively, the "Funds").
The financial statements for the remaining funds of the Trust and the Company
are presented under separate cover. The Funds currently offer six classes of
shares: Primary A Shares, Primary B Shares, Investor A Shares, Investor B
Shares, Investor C Shares and Daily Shares (formerly Investor D Shares).
Shareholders of a Fund have equal voting rights on matters affecting all
shareholders of the Fund. In addition, each class of shares of a Fund has
exclusive voting rights on matters that relate solely to its class and separate
voting rights on matters in which the interests of one class of shares differ
from the interests of any other class.
1. SIGNIFICANT ACCOUNTING POLICIES.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures in the financial statements. Actual
results could differ from those estimates. The following is a summary of
significant accounting policies followed by the Funds in the preparation of
their financial statements.
Securities Valuation: The portfolio securities of each Fund are valued on the
basis of amortized cost, which approximates market value. Amortized cost
valuation involves initially valuing an instrument at its cost and thereafter
assuming a constant amortization to maturity of any discount or premium, as long
as the effect of fluctuating interest rates on the market value of the
instrument is not significant. Restricted securities and other assets are valued
by the Funds' investment adviser under the supervision of the Board of Trustees
or the Board of Directors.
Repurchase Agreements: Each Fund may engage in repurchase agreement
transactions. Under the terms of a typical repurchase agreement, the Fund takes
possession of an underlying debt obligation subject to an obligation of the
seller to repurchase, and the Fund to resell, the obligation at an agreed-upon
price and time, thereby determining the yield during the Fund's holding period.
This arrangement results in a fixed rate of return that is not subject to market
fluctuations during the Fund's holding period. The value of the collateral
should be at least equal at all times to the total amount of the repurchase
obligations, including interest. Generally, in the event of counterparty
default, the Fund has the right to use the collateral to offset losses incurred.
There would be a potential loss to the Fund in the event the Fund is delayed or
prevented from exercising its right to dispose of the collateral securities,
including the risk of a possible decline in the value of the underlying
securities during the period while the Fund seeks to assert its right. Unless
permitted by the Securities and Exchange Commission, the Fund will not enter
into repurchase agreements with the investment adviser, distributor or any of
their affiliates. The Funds' investment adviser, acting under the supervision of
the Board of Trustees or the Board of Directors, monitors the value of
collateral received as well as the creditworthiness of those banks and dealers
with which the Funds enter into repurchase agreements to evaluate potential
risks.
Reverse Repurchase Agreements: The Funds may enter into reverse repurchase
agreements with institutions that the Funds' investment adviser has determined
are creditworthy. Under the terms of a typical reverse repurchase agreement, the
Fund sells securities and agrees to repurchase them at a mutually agreed upon
date and price. At the time the Fund enters into a reverse repurchase agreement,
it establishes a segregated account with its custodian bank in which it will
maintain cash, U.S. Government securities or other liquid high grade debt
obligations at least equal in value to the Fund's obligations arising under the
reverse repurchase agreement. Reverse repurchase agreements involve the risk
that the market value of the securities purchased with the proceeds from the
sale of securities received by the Fund may decline below the price of the
securities that the Fund is obligated to repurchase. Securities subject to
repurchase under reverse repurchase agreements are designated in the Schedule of
Investments.
At March 31, 1997, Nations Treasury Fund had reverse repurchase agreements
outstanding as follows:
<TABLE>
<S> <C>
Maturity Amount................................................................ $471,921,000
Maturity Date.................................................................. 07/01/97
Market Value of Assets Sold Under Agreements................................... $468,761,284
</TABLE>
38
<PAGE> 41
NATIONS FUNDS
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The average daily balance of reverse repurchase agreements outstanding during
the year ended March 31, 1997 was $502,264,029.
The proceeds received by Nations Treasury Fund under the reverse repurchase
agreements were reinvested in a tri-party repurchase agreement. Net fees earned
during the year ended March 31, 1997, representing the difference between
interest rates on the reverse repurchase and repurchase agreements, amounted to
$723,607 and have been included in interest income in the Statements of
Operations.
Securities Transactions and Investment Income: Securities transactions are
accounted for on trade date. Realized gains and losses are computed based on the
specific identification of the securities sold. Interest income, adjusted for
accretion of discounts and amortization of premiums calculated ratably, is
earned from the settlement date and is recorded on the accrual basis. Dividend
income is recorded on the ex-dividend date. Each Fund's investment income and
realized and unrealized gains and losses are allocated among classes based upon
the relative net assets of each class of shares.
Dividends and Distributions to Shareholders: It is the policy of each Fund to
declare dividends daily from net investment income and to pay such dividends
monthly. Each Fund will distribute net realized short-term capital gains
annually after the fiscal year in which earned or more frequently to maintain a
net asset value of $1.00 per share, unless offset by any available capital loss
carryforward. Additional distributions of net investment income and capital
gains may be made at the discretion of the Board of Trustees or the Board of
Directors in order to avoid application of the 4% non-deductible Federal excise
tax. Income distributions and capital gain distributions on a Fund level are
determined in accordance with Federal income tax regulations which may differ
from generally accepted accounting principles. These differences are primarily
due to timing differences and differing characterization of distributions made
by the Fund as a whole.
Reclassifications are made to each Funds' capital accounts to reflect income and
gains available for distribution (or available capital loss carryforwards) under
Federal income tax regulations. Certain reclassification adjustments are made
between paid-in capital and realized loss due to different book and tax
accounting for Post-October losses acquired in the merger with the Peachtree
Funds.
Reclassifications for the year ended March 31, 1997 were as follows:
<TABLE>
<CAPTION>
DECREASE
INCREASE ACCUMULATED NET
PAID-IN CAPITAL REALIZED LOSS
---------------------------------
<S> <C> <C>
Nations Prime Fund................................................ $ 2,333 $ 2,333
</TABLE>
Federal Income Tax: Each Fund intends to qualify as a regulated investment
company by complying with the requirements of the Internal Revenue Code of 1986,
as amended, applicable to regulated investment companies and by distributing
substantially all of its earnings to its shareholders. Therefore, no Federal
income or excise tax provision is required.
Expenses: General expenses of the Trust or the Company are allocated to the
relevant Funds based upon relative net assets. Operating expenses directly
attributable to a Fund or class of shares are charged to such Fund's or class's
operations. Expenses of each Fund not directly attributable to the operations of
any class of shares are prorated among the classes based on the relative net
assets of each class of shares.
Cash Flow Information: Cash, as used in the Statement of Cash Flows, is the
amount reported in the Statements of Assets and Liabilities and represents cash
on hand at custodian banks. The Trust and the Company issue and redeem shares,
invest in securities, and distribute dividends from net investment income and
net capital gains (which are either paid in cash or reinvested at the discretion
of shareholders). These activities are reported in the Statements of Changes in
Net Assets. Information on cash payments is presented in the Statement of Cash
Flows.
2. INVESTMENT ADVISORY FEE, SUB-ADVISORY FEE, ADMINISTRATION FEE AND RELATED
PARTY TRANSACTIONS.
Each of the Trust and the Company has, on behalf of its Funds, entered into an
investment advisory agreement (the "Investment Advisory Agreements") with
NationsBanc Advisors, Inc. ("NBAI"), a wholly-owned subsidiary of NationsBank,
N.A. ("NationsBank"), pursuant to which NBAI provides investment advisory
services to the Funds. Under the terms of these Investment Advisory Agreements,
NBAI is entitled to receive an advisory fee from (i) Nations
39
<PAGE> 42
NATIONS FUNDS
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Government Money Market Fund and Nations Tax Exempt Fund calculated daily and
payable monthly based on the annual rate of 0.40% of the average daily net
assets of such Funds and (ii) Nations Prime Fund and Nations Treasury Fund at
the following annual rates multiplied by the combined average daily net assets
of such Funds, as follows:
<TABLE>
<CAPTION>
FEES ON COMBINED FEES ON COMBINED
ASSETS UP TO ASSETS EXCEEDING
$250 MILLION $250 MILLION
------------------------------------
<S> <C> <C>
Nations Prime Fund............................................. 0.25% 0.20%
Nations Treasury Fund.......................................... 0.25% 0.20%
</TABLE>
Each of the Trust and the Company has, on behalf of its Funds entered into a
sub-advisory agreement (the "Sub-Advisory Agreements") with NBAI and TradeStreet
Investment Associates, Inc. ("TradeStreet"), a wholly-owned subsidiary of
NationsBank. Under the terms of these Sub-Advisory Agreements, TradeStreet is
entitled to receive a sub-advisory fee from NBAI for each Fund at the annual
rate of 0.055% of each Fund's average daily net assets.
Stephens Inc. ("Stephens") serves as the administrator of the Trust and the
Company pursuant to administration agreements (the "Administration Agreements").
First Data Investor Services Group, Inc. ("First Data"), a wholly-owned
subsidiary of First Data Corporation, serves as the co-administrator of the
Trust and the Company pursuant to co-administration agreements (the
"Co-Administration Agreements"). Pursuant to the Administration and
Co-Administration Agreements, Stephens and First Data are entitled to receive a
combined fee, computed daily and paid monthly, at the annual rate of 0.10% of
the average daily net assets of the investment portfolios of the Trust and the
Company and the investment portfolios of Nations Fund Portfolios, Inc. (another
registered investment company which is part of the Nations Funds Family) on a
combined basis. NationsBank serves as the sub-administrator of the Trust and the
Company pursuant to a sub-administration agreement (the "Sub-Administration
Agreement") with Stephens. For the year ended March 31, 1997, Stephens earned
$5,782,621, net of waiver, from the Funds for its administration services, of
which $857,544 was paid to NationsBank for its services as sub-administrator.
The investment adviser, sub-adviser, administrator and co-administrator may,
from time to time, reduce their fees payable by each Fund (either voluntarily or
pursuant to applicable state limitations). For the year ended March 31, 1997,
the investment adviser voluntarily waived fees as follows:
<TABLE>
<CAPTION>
FEES
WAIVED
BY FEES WAIVED
INVESTMENT BY
ADVISER ADMINISTRATOR
--------------------------
<S> <C> <C>
Nations Prime Fund..................................................... $1,579,771 $ 419,503
Nations Government Money Market Fund................................... 1,087,306 39,867
Nations Treasury Fund.................................................. 1,026,792 250,485
Nations Tax Exempt Fund................................................ 3,589,593 151,529
</TABLE>
NationsBank of Texas, N.A. ("NationsBank of Texas") acts as the custodian for
the Funds and, for the year ended March 31, 1997, earned $727,697 for providing
such services. On October 18, 1996, The Bank of New York ("BONY") was appointed
sub-custodian for the Funds.
First Data also serves as the transfer agent for the Funds' shares. NationsBank
of Texas also acts as the sub-transfer agent for the Primary Shares of the Funds
and, for the year ended March 31, 1997, earned approximately $22,742 for
providing such services. Stephens also serves as distributor of the Funds'
shares.
No officer, director or employee of NationsBank, NBAI, TradeStreet, Stephens,
First Data or any affiliate thereof, receives any compensation from the Trust or
the Company for serving as a trustee, director, officer or employee of the Trust
or the Company. The Trust and the Company pay each unaffiliated Trustee or
Director an annual fee of $1,000 ($3,000 for the Chairman of the Board), plus
$500 per Fund and an additional $1,000 for each in-person board meeting and $500
for each telephonic board meeting attended. The Trust and the Company also
reimburse expenses incurred by each unaffiliated Trustee or Director in
attending such meetings.
The Trust's and the Company's eligible Trustees or Directors, respectively, may
participate in a non-qualified deferred compensation and retirement plan which
may be terminated at any time. All benefits provided under these plans are
unfunded and any payments to plan participants are paid solely out of the Funds'
assets. Income earned on each plan
40
<PAGE> 43
NATIONS FUNDS
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
participant's deferral account is tied to the rate of return of the eligible
mutual funds selected by the participants or, if no funds are selected, to the
rate of return of Nations Treasury Fund. The expense for the deferred
compensation plan is included in "Trustees'/Directors' fees and expenses" in the
Statements of Operations.
3. SHAREHOLDER SERVICING AND DISTRIBUTION PLANS.
The Trust and the Company each have adopted shareholder servicing plans
("Servicing Plans") for Primary B Shares, Investor A Shares, Investor B Shares,
Investor C Shares and Daily Shares of each Fund; and a distribution plan
("Distribution Plans") pursuant to Rule 12b-1 under the 1940 Act for Investor A
Shares, Investor B Shares and Daily Shares of each Fund (collectively, the
"Plans"). The Servicing Plans permit the Funds to compensate servicing agents
and selling agents that have entered into a servicing agreement with the Funds
for services provided to their customers that own Primary B Shares, Investor A
Shares, Investor B Shares, Investor C Shares and Daily Shares, respectively. The
Distribution Plans permit the Funds to compensate or reimburse Stephens for any
activities or expenses primarily intended to result in the sale of the Funds'
Investor A Shares, Investor B Shares or Daily Shares, respectively. Payments
under the Plans are accrued daily and paid monthly at a rate set, from time to
time, by the Funds. Fees incurred pursuant to the Plans are charged as expenses
of each Fund directly to the Primary B Shares, Investor A Shares, Investor B
Shares, Investor C Shares and Daily Shares, respectively.
For the year ended March 31, 1997, the effective rates incurred by the Funds, as
a percentage of average daily net assets, pursuant to the Plans were as follows:
<TABLE>
<CAPTION>
PRIMARY B INVESTOR A INVESTOR A INVESTOR B INVESTOR B INVESTOR C DAILY DAILY
SERVICING SERVICING DISTRIBUTION SERVICING DISTRIBUTION SERVICING SERVICING DISTRIBUTION
FUND PLAN PLAN PLAN PLAN PLAN PLAN PLAN PLAN
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Nations Prime Fund..... 0.25% 0.25% 0.10% 0.25% -- 0.25% 0.25% 0.25%
Nations Government
Money Market Fund.... 0.25% 0.25% 0.10% 0.25% -- 0.25% 0.25% 0.25%
Nations Treasury
Fund................. 0.25% 0.25% 0.10% 0.25% -- 0.25% 0.25% 0.25%
Nations Tax Exempt
Fund................. 0.25% 0.25% -- 0.20% -- 0.15% 0.25% 0.25%
</TABLE>
A substantial portion of the fees paid pursuant to the plans described above are
paid to affiliates of NationsBank and NBAI.
4. SHARES OF BENEFICIAL INTEREST.
As of March 31, 1997, an unlimited number of shares without par value were
authorized for the Trust and 420,000,000,000 shares of $.001 par value capital
stock were authorized for the Company. The Trust's Declaration of Trust
authorizes the Board of Trustees to classify or reclassify any authorized, but
unissued shares into one or more additional classes or series of shares. See
Schedule of Capital Stock Activity.
5. RESTRICTED SECURITIES.
The following securities are illiquid and restricted as to resale and,
accordingly, are valued at fair value in good faith by or under the direction of
the Trust's Board of Trustees or the Company's Board of Directors, as
applicable, taking into consideration such factors as the relevant Board deems
appropriate.
The following table shows the acquisition date, the par value, value per unit,
market value, the percentage of Nations Prime Fund's total net assets that each
security comprises as well as the aggregate cost of each such security at March
31, 1997.
41
<PAGE> 44
NATIONS FUNDS
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
<TABLE>
<CAPTION>
VALUE PERCENTAGE
ACQUISITION PER MARKET OF COST AT
SECURITY DATE PAR VALUE UNIT VALUE NET ASSETS 03/31/97
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Allstate Life Insurance Company:
5.587% 06/27/97#.............................. 11/01/96 $25,000,000 $1.00 $ 25,000,000 0.6% $ 25,000,000
5.587% 06/27/97#.............................. 12/01/96 25,000,000 1.00 25,000,000 0.6 25,000,000
Anchor National Life Insurance Company,
5.683% 06/27/97#.............................. 12/01/96 25,000,000 1.00 25,000,000 0.6 25,000,000
Commonwealth Life Insurance Company, Inc.:
5.640% 09/29/97#.............................. 12/01/96 62,000,000 1.00 62,000,000 1.4 62,000,000
5.640% 09/29/97#.............................. 02/02/97 10,000,000 1.00 10,000,000 0.2 10,000,000
Life Insurance Company of Georgia,
5.633% 09/29/97#.............................. 01/01/97 60,000,000 1.00 60,000,000 1.3 60,000,000
New York Life Insurance Company,
5.652% 10/06/97+++............................ 10/07/96 100,000,000 1.00 100,000,000 2.3 100,000,000
Peoples Security Life Insurance Company:
5.690% 12/04/97+++............................ 11/04/96 20,000,000 1.00 20,000,000 0.5 20,000,000
5.640% 09/29/97#.............................. 01/05/97 20,000,000 1.00 20,000,000 0.5 20,000,000
Sun Life Insurance Company of America,
5.743% 09/29/97#.............................. 04/01/96 50,000,000 1.00 50,000,000 1.1 50,000,000
Travelers Life Insurance Company,
5.518% 05/01/97+++............................ 02/03/97 25,000,000 1.00 25,000,000 0.6 25,000,000
- -----------------------------------------------------------------------------------------------------------------------------
$422,000,000 9.7% $422,000,000
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
# Put Date
+++ Reset Date
Certain securities may be sold only pursuant to certain legal restrictions and
may be difficult to sell. No Fund will invest more than 10% of the value of its
net assets in securities that are illiquid.
The following securities of Nations Prime Fund are restricted to resale,
however, they are considered liquid due to the put feature which allows the Fund
to put the security back to the issuer at par value within seven calendar days
notice.
The following table shows the acquisition date, the par value, value per unit,
market value, the percentage of Nations Prime Fund's total net assets that each
security comprises as well as the aggregate cost of each such security at March
31, 1997.
<TABLE>
<CAPTION>
VALUE PERCENTAGE
ACQUISITION PER MARKET OF COST AT
SECURITY DATE PAR VALUE UNIT VALUE NET ASSETS 03/31/97
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
General American Life Insurance Company,
5.580% 04/07/97#.............................. 02/06/97 $50,000,000 $1.00 $ 50,000,000 1.1% $ 50,000,000
Life Insurance Company of Virginia:
5.369% 04/07/97#.............................. 09/02/96 50,000,000 1.00 50,000,000 1.1 50,000,000
5.392% 04/07/97#.............................. 02/01/97 25,000,000 1.00 25,000,000 0.6 25,000,000
5.392% 04/07/97#.............................. 03/01/97 25,000,000 1.00 25,000,000 0.6 25,000,000
- -----------------------------------------------------------------------------------------------------------------------------
$150,000,000 3.4% $150,000,000
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
# Put Date
6. CAPITAL LOSS CARRYFORWARD.
At March 31, 1997, the Funds had available for Federal income tax purposes the
following unused capital losses expiring March 31:
<TABLE>
<CAPTION>
1998 1999 2001 2002 2003 2004 2005
------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Nations Prime Fund.................................. $216,957 $203,217 -- -- -- $24,136 $25,486
Nations Government Money Market Fund................ -- -- -- $ 1,266 $61,599 1,658 --
Nations Treasury Fund............................... -- -- -- -- -- 6,459 24,565
Nations Tax Exempt Fund............................. -- -- $23,264 16,054 29,615 -- 1,480
</TABLE>
42
<PAGE> 45
NATIONS FUNDS
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Under the current tax law, capital losses realized after October 31 may be
deferred and treated as occurring on the first day of the following fiscal year.
For the fiscal year ended March 31, 1997, Nations Treasury Fund has elected to
defer losses occurring between November 1, 1996 and March 31, 1997, under these
rules, in the amount of $7,730.
In connection with the acquisition of Peachtree Government Money Market Fund by
Nations Government Money Market Fund, a capital loss carryforward of $2,954 was
acquired, of which $0 has been used as of March 31, 1997.
7. REORGANIZATION.
On September 27, 1996, certain Nations Funds, as listed below (each an
"Acquiring Fund"), acquired the assets and certain liabilities of the Peachtree
Funds, also listed below (each an "Acquired Fund"), in a tax-free exchange for
shares of the Acquiring Fund, pursuant to a plan of reorganization approved by
the Acquired Fund's shareholders. Total shares issued by the Acquiring Fund, the
value of the shares issued by the Acquiring Fund, the total net assets of the
Acquired Fund and the Acquiring Fund at the acquisition date as well as the
total net assets of each Acquiring Fund after the acquisition are as follows:
<TABLE>
<CAPTION>
SHARES VALUE OF TOTAL NET
ISSUED SHARES ISSUED ASSETS OF TOTAL NET ASSETS
ACQUIRING ACQUIRED ACQUISITION BY ACQUIRING BY ACQUIRING ACQUIRED OF ACQUIRING
FUND FUND DATE FUND FUND FUND FUND
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Nations Prime Peachtree
Fund Prime Money
Market Fund 09/27/96 46,492,996 $46,492,996 $46,490,663 $4,147,941,938
Nations Peachtree
Government Government
Money Market Money Market
Fund Fund 09/27/96 31,480,400 31,480,400 31,477,446 364,861,596
<CAPTION>
TOTAL NET ASSETS
OF ACQUIRING
ACQUIRING FUND AFTER
FUND ACQUISITION
- ----------------------------------------------------------------------------------------------------------------------
<S> <C>
Nations Prime
Fund
$4,194,432,601
Nations
Government
Money Market
Fund 396,339,042
</TABLE>
8. SIGNIFICANT CONCENTRATIONS.
On February 26, 1997, NationsBank Corporation's (the "Corporation") Asset
Management Group announced plans to sell its Institutional Trust, Retirement
Services and Corporate Trust businesses (collectively, the "Businesses"). The
Businesses make significant use of the Nations Family of Funds (the "Nations
Funds") to satisfy their clients' investment needs. It is uncertain at this
point what impact, if any, the sale of these Businesses will have on the Nations
Funds and its shareholders. Currently, however, the investment adviser, does not
believe that a significant impact to the overall financial condition and
operating performance of the Funds will occur.
9. SUBSEQUENT EVENT.
Each of the Trust and the Company, is a party to an Agreement and Plan of
Reorganization with The Pilot Funds (which are advised by Boatmen's Trust
Company, an affiliate of NationsBank Corporation since January 7, 1997) pursuant
to which certain Nations Funds portfolios will acquire the assets of The Pilot
Funds portfolios. The shareholders of The Pilot Funds voted to approve the
proposed reorganizations on or before May 14, 1997. As of March 31, 1997, net
assets of the fourteen funds comprising The Pilot Funds were approximately $6.5
billion. The reorganization involves the following Funds:
<TABLE>
<CAPTION>
NATIONS FUNDS PILOT FUNDS
- ------------------------------------------------------------------------------------------------------
<S> <C>
Prime Fund Short-Term Diversified Assets
Treasury Fund Short-Term U.S. Treasury Fund
Tax Exempt Fund Short-Term Tax-Exempt
and Missouri Short-Term Tax-Exempt
</TABLE>
43
<PAGE> 46
NATIONS FUNDS
- --------------------------------------------------------------------------------
REPORT OF INDEPENDENT ACCOUNTANTS
TO THE SHAREHOLDERS, DIRECTORS AND TRUSTEES OF NATIONS FUNDS
In our opinion, the accompanying statements of assets and liabilities, including
the schedules of investments, and the related statements of operations, the
statement of cash flows for Nations Treasury Fund, the statements of changes in
net assets and the financial highlights present fairly, in all material
respects, the financial position of Nations Prime Fund, Nations Government Money
Market Fund, Nations Treasury Fund and Nations Tax Exempt Fund (collectively
referred to as the "Funds") at March 31, 1997 and the results of each of their
operations, the cash flows for Nations Treasury Fund, the changes in each of
their net assets and their financial highlights for the periods indicated, in
conformity with generally accepted accounting principles. These financial
statements and financial highlights (hereafter referred to as "financial
statements") are the responsibility of the Funds' management; our responsibility
is to express an opinion on these financial statements based on our audits. We
conducted our audits of these financial statements in accordance with generally
accepted auditing standards which require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at March 31, 1997 by
correspondence with the custodian and brokers and the application of alternative
procedures where confirmations from brokers were not received, provide a
reasonable basis for the opinion expressed above.
PRICE WATERHOUSE LLP
Boston, Massachusetts
May 15, 1997
44
<PAGE> 47
NATIONS FUNDS
- --------------------------------------------------------------------------------
TAX INFORMATION (UNAUDITED)
For the period ended March 31, 1997, all of the distributions made from
investment income of Nations Tax Exempt Fund, are tax exempt for regular Federal
income tax purposes. A portion of this income may be subject to Federal
Alternative Minimum Tax.
45
<PAGE> 48
THE NATIONS FUNDS FAMILY
EQUITY FUNDS
GROWTH
Nations Emerging Markets Fund
Nations Pacific Growth Fund
Nations International Equity Fund
Nations Managed Smallcap Index Fund
Nations Emerging Growth Fund
Nations Disciplined Equity Fund
Nations Capital Growth Fund
GROWTH AND INCOME
Nations Value Fund
Nations Managed Index Fund
Nations Equity Index Fund
Nations Equity Income Fund
Nations Balanced Assets Fund
LIFEGOAL PORTFOLIOS
LifeGoal Growth Portfolio
LifeGoal Balanced Growth Portfolio
LifeGoal Income and Growth Portfolio
BOND FUNDS
INCOME
Nations Global Government Income Fund
Nations Diversified Income Fund
Nations Strategic Fixed Income Fund
Nations Government Securities Fund
Nations Short-Intermediate Government Fund
Nations Short-Term Income Fund
TAX-EXEMPT INCOME
Nations Municipal Income Fund
Nations Intermediate Municipal Bond Fund
Nations Short-Term Municipal Income Fund
Nations Florida Municipal Bond Fund
Nations Florida Intermediate Municipal Bond Fund
Nations Georgia Municipal Bond Fund
Nations Georgia Intermediate Municipal Bond Fund
Nations Maryland Municipal Bond Fund
Nations Maryland Intermediate Municipal Bond Fund
Nations North Carolina Municipal Bond Fund
Nations North Carolina Intermediate Municipal Bond Fund
Nations South Carolina Municipal Bond Fund
Nations South Carolina Intermediate Municipal Bond Fund
Nations Tennessee Municipal Bond Fund
Nations Tennessee Intermediate Municipal Bond Fund
Nations Texas Municipal Bond Fund
Nations Texas Intermediate Municipal Bond Fund
Nations Virginia Municipal Bond Fund
Nations Virginia Intermediate Municipal Bond Fund
MONEY MARKET FUNDS
Nations Prime Fund
Nations Government Money Market Fund
Nations Treasury Fund
Nations Tax Exempt Fund
For more complete information on Nations Funds mutual funds, including charges
and expenses, please contact Nations Funds or your Investment Representative for
a current prospectus. Please read the prospectus carefully before you invest or
send money.
<PAGE> 49
This report is submitted for the general information of shareholders of Nations
Funds. This material must be preceded or accompanied by a current Nations Funds
prospectus.
<PAGE> 50
NATIONS BULK RATE
FUNDS U.S. POSTAGE
P.O. Box 34602 PAID
Charlotte, NC 28234-4602 N READING, MA
Toll Free 1-800-982-2271 PERMIT NO.
105
AR2 IN-96117-397
