<PAGE> 1
[NATIONS FUNDS LOGO] [GRAPHIC OF TREE]
INVESTMENTS FOR A LIFETIME(SM)
MUNICIPAL Nations Short-Term
BOND Municipal Income Fund
FUNDS
Nations Intermediate
Municipal Bond Fund
Nations Municipal
Income Fund
Nations FL Intermediate
Municipal Bond Fund
Nations FL Municipal
Bond Fund
Nations GA Intermediate
Municipal Bond Fund
Nations GA Municipal
Bond Fund
Nations MD Intermediate
Municipal Bond Fund
Nations MD Municipal
Bond Fund
Nations NC Intermediate
Municipal Bond Fund
Nations NC Municipal
Bond Fund
Nations SC Intermediate
Municipal Bond Fund
Nations SC Municipal
Bond Fund
Nations TN Intermediate
Municipal Bond Fund
Nations TN Municipal
Bond Fund
Nations TX Intermediate
Municipal Bond Fund
Nations TX Municipal
Bond Fund
Nations VA Intermediate
Municipal Bond Fund
SEMI-ANNUAL REPORT FOR THE PERIOD Nations VA Municipal
ENDED SEPTEMBER 30, 1998 Bond Fund
<PAGE> 2
[BACKGROUND BASKET DEPICTED GRAPHIC]
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.
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.
-----------------
NOT FDIC-
INSURED
-----------------
MAY LOSE VALUE
-----------------
NO BANK GUARANTEE
-----------------
<PAGE> 3
NATIONS FUNDS
DEAR SHAREHOLDER:
Thus far in 1998, equity investors have experienced a "roller-coaster" ride that
has been both dramatic and ugly. Stock mutual funds of almost every stripe and
color fell sharply during the third quarter. According to Lipper Analytical
Services, Inc., the average diversified U.S. stock fund posted a negative 15%
return during the quarter, with small company funds losing over 21%.
International equity funds also experienced downturns over the last three
months, with diversified international funds losing 16% on average and emerging
markets funds sliding a steep 23%.*
The three months ending September 30 represented the worst quarter for U.S.
stock funds since the third quarter of 1990. At that time, we were in a heated
showdown with Saddam Hussein and Iraq. The obvious question on everyone's mind
today is: what are the drivers causing the extreme volatility being experienced
in the markets? We think that the answer may be as simple as a shift in
psychology by investors. From January 1997 through July 1998, investors were
comfortable with assuming risk -- almost too comfortable. Equity valuations
reflected a close to perfect environment. Bond yield comparisons to U.S.
Treasuries also reflected a comfort with credit risk. However, Russia's debt
default in August 1998 was the last in a combination of bad news and
uncertainties that changed the prevailing mind set and compelled investors to
run for cover. Global anxieties were sufficient overall to push investors in one
direction: "risk avoidance."
As we look forward, several thoughts come to mind that lead us to remain
optimistic: 1) interest rates have dropped to thirty-year lows and the U.S.
economy is very rate sensitive; 2) inflation remains in check; 3) corporate
profits, while slowing, should pick up if our economy avoids recession; 4)
Japan's government is attacking its banking crisis with an approach similar to
that used in the U.S. savings and loan crisis in the 1980s, and 5) the Federal
Reserve Board has twice moved in the last month to lower the target on the
Federal Funds rate in an effort to fend off any "credit crunch."
While the risk for recession in 1999 is growing, we believe that conditions in
the U.S. will remain sound and that next year will be another year of positive
economic activity. Consistent monetary policy, a solid fiscal condition, low
inflation, and high employment are important ingredients for our economic
picture. Investors need to remain alert and appreciate the fact that changing
conditions may translate into further market volatility. On behalf of our
shareholders, we will stay vigilant in our work as we pursue the Funds'
objectives.
Sincerely,
/s/ A. Max Walker
A. MAX WALKER
President and Chairman of the Board
/s/ Robert H. Gordon
ROBERT H. GORDON
President, NationsBanc Advisors, Inc.
September 30, 1998
Source for all statistical data: TradeStreet Investment Associates, Inc.
* Lipper Analytical Services, Inc. is an independent fund performance monitor.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
<PAGE> 4
[THIS PAGE INTENTIONALLY LEFT BLANK.]
<PAGE> 5
Table
Of
Contents
<TABLE>
<S> <C>
FINANCIAL STATEMENTS
Statements of Net Assets 2
Statements of Operations 84
Statements of Changes in Net Assets 88
Schedules of Capital Stock Activity 96
Financial Highlights 116
Notes to Financial Statements 154
</TABLE>
<PAGE> 6
NATIONS FUNDS
Nations Short-Term Municipal Income Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 101.5%
ALASKA -- 3.7%
$ 1,490 Alaska State, Industrial
Development Authority,
Revolving Fund, Series A,
(MBIA Insured),
5.000% 04/01/04.......... Aaa AAA $ 1,553
1,000 Alaska State, Student Loan
Corporation, Student Loan
Revenue, Series A, AMT,
(AMBAC Insured),
4.900% 07/01/00.......... Aaa AAA 1,017
2,000 North Slope Borough,
Alaska, GO, Series B,
(CGIC Insured),
6.100% 06/30/99.......... Aaa AAA 2,041
--------
4,611
--------
ARIZONA -- 7.1%
1,700 Arizona, East Valley,
Institute of Technology,
Project of 1994, Series B,
(AMBAC Insured),
6.400% 07/01/00.......... Aaa AAA 1,780
2,125 Maricopa County, Arizona,
School District, Number
006-Washington
Elementary, GO, (Projects
of 1996), Series B, (FGIC
Insured),
5.000% 07/01/00.......... Aaa AAA 2,176
1,370 Maricopa County, Arizona,
School District Number 4,
Mesa University, Series
D, (AMBAC-TCRS Insured),
6.900% 07/01/00.......... Aaa AAA 1,446
3,500 Phoenix, Arizona
Industrial Development
Authority, Single Family
Mortgage Revenue, Series
D, (FGIC Insured),
4.200% 06/01/02.......... NR Sp1+ 3,502
--------
8,904
--------
DISTRICT OF COLUMBIA -- 2.2%
1,750 District of Columbia,
Refunding, GO, Series C,
(FSA-CR Insured),
5.100% 12/01/99.......... Aaa AAA 1,782
1,000 Metropolitan District of
Columbia, Virginia
Apartment Revenue,
Refunding, AMT, Series B,
5.000% 10/01/03.......... Aa3 AA- 1,048
--------
2,830
--------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
GEORGIA -- 0.8%
$ 1,000 Clarke County, Georgia,
School District, GO,
Refunding, (FSA Insured),
5.125% 09/01/00.......... Aaa AAA $ 1,028
--------
GUAM -- 2.0%
Government of Guam:
500 Airport Authority Revenue,
Series A,
5.400% 10/01/99.......... NR BBB 509
2,000 GO, Series A,
5.375% 09/01/00.......... NR BBB 2,012
--------
2,521
--------
HAWAII -- 0.8%
1,000 Hawaii State, GO,
Series BT,
5.700% 02/01/99.......... A1 A+ 1,008
--------
ILLINOIS -- 3.3%
1,000 Chicago, Illinois,
Metropolitan Water
Reclamation District -
Greater Chicago, GO,
Refunding,
4.150% 12/01/99.......... Aa2 AA 1,009
1,000 Chicago, Illinois, O'Hare
International Airport,
General Airport Revenue,
Second Lien, Series A,
AMT, (AMBAC Insured),
5.000% 01/01/02.......... Aaa AAA 1,032
2,000 Illinois Health Facilities
Authority Revenue,
(Ingalls Memorial
Hospital Project),
Pre-Refunded,
(MBIA Insured),
7.000% 01/01/19.......... Aaa AAA 2,121
--------
4,162
--------
INDIANA -- 1.0%
1,280 Indiana State, Health
Facilities Financing
Authority, Hospital
Revenue Refunding,
(Methodist Hospital Inc.
Project),
6.000% 09/15/99.......... A2 NR 1,310
--------
IOWA -- 2.5%
3,000 Iowa Student Loan
Liquidity Corporation,
Student Loan Revenue,
Series B,
4.900% 12/01/05.......... Aaa NR 3,125
--------
MARYLAND -- 2.1%
1,500 Baltimore, Maryland,
Wastewater Utilities
Revenue, Series A,
(MBIA Insured),
6.500% 07/01/20.......... Aaa AAA 1,573
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
2
<PAGE> 7
NATIONS FUNDS
Nations Short-Term Municipal Income Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
MARYLAND -- (CONTINUED)
$ 1,000 Montgomery County,
Maryland, Construction
for Public Improvement,
GO, Refunded, Series B,
6.800% 11/01/08.......... AAA AAA $ 1,056
--------
2,629
--------
MASSACHUSETTS -- 0.8%
1,000 Massachusetts State,
Refunding, GO, Series A,
5.500% 07/01/99.......... A1 A+ 1,016
--------
MICHIGAN -- 4.3%
2,000 Detroit, Michigan,
Convention Facilities
Revenue Refunding, (Cobo
Hall Expansion Project),
4.750% 09/30/00.......... NR A 2,036
1,000 Detroit, Michigan, GO,
Series B,
5.100% 04/01/99.......... Baa2 BBB+ 1,008
1,000 Detroit, Michigan, Self-
Insurance, GO, Series A,
5.600% 05/01/01.......... NR BBB 1,040
1,210 Wayne Charter County,
Michigan, Apartment
Revenue, AMT, Series A,
(MBIA Insured),
5.250% 12/01/04.......... Aaa AAA 1,293
--------
5,377
--------
MINNESOTA -- 1.0%
1,200 Minneapolis, Minnesota,
Hospital Revenue,
Refunded, (Lifespan,
Incorporated - Abbott
Northwestern),
7.000% 12/01/05.......... AAA AAA 1,272
--------
MISSISSIPPI -- 6.4%
3,000 Grenada County,
Mississippi, Revenue,
(Refunding GA-Pacific
Corporation Project),
4.300% 09/01/00.......... Baa2 NR 3,015
5,000 Lawrence County,
Mississippi, Pollution
Central Revenue,
4.300% 12/01/00.......... Baa2 NR 5,040
--------
8,055
--------
MONTANA -- 1.6%
2,000 Forsyth County, Montana,
Pollution Control,
Revenue Refunding,
(Portland General
Electric Company), Series
A,
4.600% 05/01/33.......... A3 A- 2,036
--------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
NEVADA -- 1.7%
$ 1,000 Clark County, Nevada,
Sanitation District, GO,
Series A, (AMBAC
Insured),
5.700% 07/01/99.......... Aaa AAA $ 1,018
1,000 Henderson County, Nevada,
Water Revenue, Series A,
(AMBAC Insured),
6.200% 12/01/09.......... Aaa AAA 1,102
--------
2,120
--------
NEW MEXICO -- 0.9%
1,090 New Mexico Mortgage
Finance Authority,
Single-family Mortgage
Purchase, Refunding,
Series A-1,
5.900% 07/01/99.......... Aa1 AA 1,105
--------
NEW YORK -- 8.2%
5,000 New York City, New York,
Municipal Assistance
Corporation, Series M,
5.000% 07/01/01.......... Aa2 AA 5,178
1,000 New York State, Refunding,
GO, Series B,
6.375% 08/15/00.......... A2 A 1,049
4,000 New York State Thruway
Authority, Service
Contract Revenue, Local
Highways and Bridges,
Refunding,
5.000% 04/01/01.......... Baa1 BBB+ 4,110
--------
10,337
--------
NORTH CAROLINA -- 5.0%
1,000 North Carolina Eastern
Municipal Power Agency,
Power System Revenue,
Refunding, Series A,
5.000% 01/01/99.......... Baa1 BBB 1,003
North Carolina Medical
Care Community Hospital
Revenue, Halifax Regional
Medical Center:
1,120 4.150% 08/15/01.......... Baa1 NR 1,121
1,000 4.300% 08/15/02.......... Baa1 NR 1,004
1,560 4.300% 08/15/03.......... Baa1 NR 1,563
1,630 4.400% 08/15/04.......... Baa1 NR 1,637
--------
6,328
--------
OHIO -- 1.4%
1,740 Ohio Housing Financing
Agency Mortgage Revenue,
Series B, AMT, (GNMA Coll
Insured),
4.800% 09/01/07.......... NR AAA 1,786
--------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
3
<PAGE> 8
NATIONS FUNDS
Nations Short-Term Municipal Income Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
PENNSYLVANIA -- 11.0%
$ 5,425 Dauphin County,
Pennsylvania, General
Authority, School
District Pooled Financing
Program II, (AMBAC
Insured),
4.450% 09/01/32.......... Aaa NR $ 5,520
Greene County,
Pennsylvania, Industrial
Development Authority,
Series B:
1,560 (Monongahela Power
Company),
4.350% 02/01/02.......... A2 A- 1,576
2,200 (Potomac Edison Company),
4.350% 02/01/02.......... A2 A- 2,223
Monroeville, Pennsylvania,
Hospital Authority,
Revenue Refunding,
(Forbes Health System):
1,000 4.875% 10/01/98.......... A3 A- 995
1,000 5.000% 10/01/99.......... A3 A- 970
1,000 5.125% 10/01/00.......... A3 A- 950
1,500 Philadelphia,
Pennsylvania, Water &
Waste Water Revenue,
(FGIC Insured),
5.500% 06/15/03.......... Aaa AAA 1,602
--------
13,836
--------
SOUTH CAROLINA -- 0.8%
1,000 Medical University of
South Carolina, Hospital
Facilities Revenue
Refunding, Series A,
7.000% 07/01/00.......... A3 A+ 1,055
--------
TENNESSEE -- 1.8%
2,100 McMinn County, Tennessee,
Industrial Development
Board, PCR, Refunding,
(Bowater Inc. Project),
6.850% 04/01/01.......... Baa1 BBB 2,241
--------
TEXAS -- 15.2%
1,000 Addison, Texas, Refunding,
GO, (FGIC Insured),
6.100% 09/01/99.......... Aaa AAA 1,002
1,010 Addison, Texas, CTFS
Obligation, (FSA
Insured),
6.250% 02/15/01.......... Aaa AAA 1,069
Brazos, Texas, Higher
Education Authority Inc.,
Revenue Refunding, AMT,
(GTD STD LNS):
950 Senior Lien, Series A-2,
5.850% 06/01/01.......... Aaa NR 993
1,415 Series C-1,
6.000% 11/01/99.......... Aa NR 1,450
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
TEXAS -- (CONTINUED)
$ 1,000 Conroe, Texas, Independent
School District, GO,
Schoolhouse and
Refunding, (MBIA
Insured),
7.000% 02/01/99.......... Aaa AAA $ 1,012
1,000 Dallas-Fort Worth, Texas,
Regional Airport Revenue,
6.000% 11/01/02.......... A1 A+ 1,080
1,650 Harris County, Texas, GO,
Refunding,
5.600% 10/01/01.......... Aa2 AA 1,741
2,450 Houston, Texas, Water and
Sewer System, Revenue
Refunding, Prior Lien,
Series B,
5.250% 12/01/99.......... A3 A 2,500
3,000 Panhandle-Plains, Texas,
Higher Education
Authority Inc., Student
Loan Revenue, Series E,
(GTD STD LNS),
5.550% 03/01/05.......... A NR 3,158
1,880 Texas State, Texas A&M
University Revenue,
5.000% 05/15/02.......... Aa2 AA 1,959
1,000 Texas State College,
Texas, Student Loan
Authority Revenue, GO,
AMT,
5.100% 08/01/01.......... Aa2 AA 1,034
2,000 University of Texas,
Permanent University
Fund, Revenue Refunding,
6.500% 07/01/11.......... AAA AAA 2,184
--------
19,182
--------
VIRGINIA -- 5.0%
1,000 Ashland, Virginia, IDA,
Educational Facilities
Revenue, (Randolph-Macon
College Project),
4.375% 11/01/11.......... NR A- 1,008
2,350 Greenville County,
Virginia, Industrial
Development Authority
Revenue,
4.100% 08/01/00.......... Baa2 NR 2,360
1,000 Virginia Beach, Virginia,
GO, Series A,
6.800% 06/01/99.......... Aa2 AA 1,023
1,825 Virginia Education Loan
Authority, (GTD STD LNS),
6.625% 09/01/03.......... AAA NR 1,972
--------
6,363
--------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
4
<PAGE> 9
NATIONS FUNDS
Nations Short-Term Municipal Income Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
WASHINGTON -- 10.0%
$ 1,000 Conservation and Renewable
Energy System Revenue,
Washington, (Washington
Conservation Project),
5.050% 10/01/98.......... Aa1 AA- $ 1,000
1,570 King County, Washington,
GO, Series A,
9.000% 12/01/98.......... Aa1 AA+ 1,585
2,000 Port Seattle, Washington
State, Passenger Facility
Charge Revenue, AMT,
Series B, (AMBAC
Insured),
5.000% 12/01/04.......... Aaa AAA 2,096
1,000 Washington State, Revenue,
GO, Series B,
Pre-Refunded,
6.600% 08/01/01.......... Aa1 AA+ 1,053
Revenue Refunding,
(Nuclear Project No. 2):
4,000 Series A,
5.000% 07/01/00.......... Aa1 AA- 4,082
1,000 Series C,
7.300% 07/01/00.......... Aa1 AA- 1,058
1,675 (MBIA-IBC Insured),
7.200% 07/01/99.......... Aaa AAA 1,721
--------
12,595
--------
WISCONSIN -- 0.9%
1,115 Kenosha, Wisconsin, GO,
Refunding, Promissory
Notes, Series B,
4.150% 12/01/99.......... A1 AA- 1,118
--------
TOTAL MUNICIPAL
BONDS AND NOTES
(Cost $126,385)........................... 127,950
--------
</TABLE>
<TABLE>
<CAPTION>
VALUE
SHARES (000)
- -------------------------------------------------------------------
<C> <S> <C> <C>
INVESTMENT COMPANY -- 4.4%
(Cost $5,595)
5,595,000 AIM Tax-Exempt Fund......................... $ 5,595
TOTAL INVESTMENTS
(Cost $131,980*).................... 105.9% 133,545
--------
OTHER ASSETS AND LIABILITIES (NET)... (5.9)
Receivable for fund shares sold............. 416
Dividends and interest receivable........... 1,719
Payable for fund shares redeemed............ (286)
Investment advisory fee payable............. (16)
Administration fees payable................. (8)
Shareholder servicing and distribution
fees payable............................... (55)
Dividend payable............................ (408)
Payable for investment securities
purchased.................................. (8,812)
Accrued trustees' fees and expenses......... (6)
Accrued expenses and other liabilities...... (17)
--------
TOTAL OTHER ASSETS AND LIABILITIES (NET).... (7,473)
--------
NET ASSETS........................... 100.0% $126,072
========
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE
PRIMARY A SHARES:
($71,551,000/7,086,462 shares
outstanding)............................... $10.10
========
INVESTOR A SHARES:
($37,070,000/3,671,379 shares
outstanding)............................... $10.10
========
INVESTOR B SHARES:
($14,572,000/1,443,229 shares
outstanding)............................... $10.10
========
INVESTOR C SHARES:
($2,879,000/285,059 shares outstanding)..... $10.10
========
NET ASSETS CONSIST OF:
Undistributed net investment income......... $ 39
Accumulated net realized loss
on investments sold........................ (371)
Net unrealized appreciation of
investments................................ 1,565
Paid-in capital............................. 124,839
--------
NET ASSETS.................................. $126,072
========
</TABLE>
- ---------------
* Federal Income Tax Information: Net unrealized appreciation of investment
securities was comprised of appreciation of $1,647,000 and gross depreciation
of $82,000 for federal income tax purposes. At September 30, 1998, the
aggregate cost of securities for federal income tax purposes was $131,980,000.
Nations Short-Term Municipal Bond Fund had the following insurance concentration
greater than 10% at September 30, 1998 (as a percentage of net assets):
AMBAC 11.03%
SEE NOTES TO FINANCIAL STATEMENTS.
5
<PAGE> 10
NATIONS FUNDS
Nations Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 103.6%
ALABAMA -- 1.8%
$ 2,500 Birmingham, Alabama,
Industrial Water Board,
Industrial Water Supply
Revenue,
6.000% 07/01/07........... NR AAA $ 2,860
2,500 Birmingham, Alabama,
Special Care Facility
Financing Authority
Revenue, (Baptist Medical
Centers), Series A, (MBIA
Insured),
5.500% 08/15/05........... Aaa AAA 2,647
5,750 Courtland, Alabama,
Industrial Development
Board, Solid Waste
Disposal, Series A,
6.375% 03/01/29........... Baaa1 BBB 6,118
3,600 Jefferson County, Alabama,
Sewer Revenue Refunding,
Series A, (FGIC Insured),
5.625% 02/01/18........... Aaa AAA 3,885
--------
15,510
--------
ALASKA -- 2.0%
3,000 Alaska State, Housing
Finance Corporation,
Series A, (MBIA Insured),
5.400% 06/01/08........... Aaa AAA 3,181
Alaska State, Industrial
Development Authority,
Revolving Fund, Refunding,
(MBIA Insured):
2,590 5.250% 04/01/07........... Aaa AAA 2,762
3,345 5.250% 04/01/12........... Aaa AAA 3,504
Alaska State, Student Loan
Corporation, Student Loan
Revenue,
Series A, AMT,
(AMBAC Insured):
3,280 5.250% 07/01/03........... Aaa AAA 3,432
1,500 5.150% 07/01/05........... Aaa AAA 1,576
1,250 5.200% 07/01/06........... Aaa AAA 1,316
2,000 Anchorage, Alaska, GO,
Series A, (AMBAC Insured),
5.100% 08/01/07........... Aaa AAA 2,133
--------
17,904
--------
ARIZONA -- 1.8%
2,250 Arizona State, University,
Revenue Refunding:
6.000% 07/01/07........... A1 AA 2,578
955 Series A,
6.500% 07/01/01........... A1 AA 1,026
1,100 Glendale, Arizona,
Refunding, GO, (FGIC
Insured),
4.950% 07/01/01........... Aaa AAA 1,137
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
ARIZONA -- (CONTINUED)
$ 7,000 Maricopa County, Arizona,
School District No. 4 -
Mesa University, Series D,
(AMBAC-TCRS Insured),
6.900% 07/01/00........... Aaa AAA $ 7,387
300 Maricopa County, Arizona,
Union High School District
No 210 - Phoenix, Series
D,
6.700% 07/01/03........... Aa3 AA 326
400 Pima County, Arizona, Union
School District No.
1 - Tucson, (MBIA
Insured):
6.700% 07/01/04........... Aaa AAA 435
2,125 (Project of 1989), Series
G, GO,
7.300% 07/01/05........... Aaa AAA 2,541
400 Tempe, Arizona, GO,
5.600% 07/01/00........... Aa1 AA+ 410
--------
15,840
--------
ARKANSAS -- 0.9%
7,000 Hot Springs, Arkansas,
Industrial Development
Revenue Refunding,
(Willamette Industries),
6.650% 12/01/02........... NR A- 7,692
--------
COLORADO -- 1.6%
1,500 Arapahoe County, Colorado,
School District No. 5,
(Cherry Creek),
7.000% 12/15/04........... Aa AA 1,621
Denver, Colorado, City and
County GO:
3,445 Series A,
5.700% 08/01/01........... Aa2 AA 3,606
7,000 Series C,
5.750% 08/01/06........... Aa2 AA 7,332
1,500 Northglenn, Colorado,
Refunding, Water and
Sewer, GO, (FSA Insured),
5.250% 12/01/04........... Aaa AAA 1,613
--------
14,172
--------
CONNECTICUT -- 2.8%
Connecticut State, GO:
300 Series A,
6.600% 03/01/04........... AAA AAA 326
1,000 Series B,
4.800% 03/15/01........... Aa3 AA- 1,029
2,500 Series C,
5.500% 08/01/07........... Aa3 AA- 2,783
6,625 Series D,
5.500% 03/15/01........... Aa3 AA- 7,397
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
6
<PAGE> 11
NATIONS FUNDS
Nations Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
CONNECTICUT -- (CONTINUED)
$ 6,140 Connecticut State, Special
Tax Obligation, Revenue
Refunding, (Transportation
Infastructure Project),
Series A, (FGIC-TCRS
Insured),
5.100% 09/01/04........... Aaa AAA $ 6,563
6,465 Connecticut State, Housing
Finance Authority,
5.600% 11/15/21........... Aa2 AA 6,714
--------
24,812
--------
DISTRICT OF COLUMBIA -- 0.5%
District of Columbia,
Hospital Revenue,
Refunding, (Medlantic
Healthcare Group), Series
A, (MBIA Insured):
1,000 6.000% 08/15/06........... Aaa AAA 1,117
1,350 6.000% 08/15/07........... Aaa AAA 1,519
1,500 Metropolitan Washington,
D.C., Airport Authority of
Virginia, General Airport
Revenue, Series A, AMT,
(MBIA Insured),
5.600% 10/01/06........... Aaa AAA 1,637
--------
4,273
--------
FLORIDA -- 6.2%
5,895 Alachua County, Florida,
Public Improvement
Revenue, Refunding, (FSA
Insured),
5.000% 08/01/14........... Aaa AAA 6,080
1,000 Broward County, Florida,
School District,
Refunding,
5.100% 02/15/02........... A1 AA- 1,044
2,700 Duval County, Florida,
Housing Finance Authority
Refunding, (Greentree
Place Project),
6.750% 04/01/25........... NR BBB+ 2,950
4,770 Duval County, Florida,
Housing Finance Authority,
Multi-Family Mortgage
Revenue, Refunding, (The
Cove Project),
6.100% 10/01/02........... NR AAA 5,050
3,035 Florida State Board of
Education, Capital Outlay,
Public Education,
Series A,
5.400% 01/01/06........... Aa2 AA+ 3,302
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
FLORIDA -- (CONTINUED)
$ 3,650 Florida State Division of
Bond Financing, Department
of General Services
Revenue, Department of
Natural
Resources - Preservation
2000, Series A, AMBAC
Insured), 6.200%
07/01/00.................. Aaa AAA $ 3,813
Florida State Housing
Finance Agency, Refunding,
Multi-family Housing:
7,440 (Altamonte Project),
Series C,
7.000% 12/01/24........... NR BBB+ 8,285
2,000 (Andover Project), Series
E,
6.350% 05/01/26........... NR BBB+ 2,172
Jacksonville, Florida,
Electric Authority
Revenue, Refunding, (St.
John River), Issue 2:
300 Series 6-C,
6.400% 10/01/00.......... Aa2 AA 316
Series 10:
5,900 5.000% 10/01/04........... Aa2 AA 6,218
1,500 4.600% 10/01/00........... Aa2 AA 1,528
2,080 Nassau County, Florida,
Pollution Control Revenue
Refunding, (ITT Rayonier
Inc. Project),
5.700% 06/01/01........... Baa2 BBB+ 2,167
Orlando Utilities
Commission, Florida, Water
and Electric Revenue,
Refunding:
1,000 5.200% 10/01/00........... Aa1 AA 1,031
4,000 5.600% 10/01/03........... Aa1 AA 4,333
5,490 Pinellas County, Florida,
Resource Recovery Revenue,
Refunding, Series A, (MBIA
Insured),
6.600% 10/01/00........... Aaa AAA 5,810
600 Tampa, Florida, Guaranteed
Entitlement Revenue,
Refunding, (AMBAC
Insured),
6.500% 10/01/99........... Aaa AAA 619
--------
54,718
--------
GEORGIA -- 3.4%
8,500 Burke County, Georgia,
Development Authority,
PCR, (Oglethorpe Power
Corporation Project),
Series B,
4.900% 01/01/06........... A3 A 8,917
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
7
<PAGE> 12
NATIONS FUNDS
Nations Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
GEORGIA -- (CONTINUED)
$ 3,000 Cartersville, Georgia,
Development Authority,
Revenue Refunding, Sewer
Facilities, (Anheuser
Busch Companies Inc.),
5.625% 05/01/09........... A1 A+ $ 3,284
1,500 Fulco, Georgia, Hospital
Authority Revenue, Revenue
Anticipation Certificates,
St. Joseph's Hospital,
5.100% 10/01/05........... A3 A 1,583
1,105 Fulton County, Georgia,
Development Authority
Revenue, (Clark University
Project), (CONNIE LEE
Insured),
5.100% 01/01/05........... Baa2 AAA 1,168
5,000 Fulton De Kalb, Georgia,
Hospital Authority,
Hospital Revenue
Refunding, (Grady Memorial
Hospital Projects), (MBIA
Insured),
5.250% 01/01/04........... Aaa AAA 5,325
300 Georgia Municipal Electric
Authority, Power Revenue,
Refunded, Series U,
6.800% 01/01/03........... AAA A 326
Georgia State, GO:
2,940 7.250% 09/01/04........... Aaa AAA 3,466
300 Series D,
7.000% 11/01/00........... Aaa AAA 320
Gwinnett County, Georgia,
School District:
1,500 4.500% 02/01/15........... Aa1 AA+ 1,458
4,000 Refunding, Series B,
6.200% 02/01/03........... Aa1 AA+ 4,384
--------
30,231
--------
HAWAII -- 1.6%
Hawaii State, GO:
1,000 Series BU,
5.850% 11/01/01........... Aa A+ 1,060
2,000 Series CJ,
5.625% 01/01/02........... Aa3 A+ 2,107
2,000 Series CL,
5.000% 03/01/03........... Aa3 A+ 2,087
5,000 Series CN, (FGIC Insured),
6.250% 03/01/04........... Aaa AAA 5,553
2,500 Honolulu, Hawaii, City and
County, Refunding, GO,
Series A,
7.350% 07/01/07........... Aa2 AA 3,076
--------
13,883
--------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
ILLINOIS -- 8.2%
$ 2,500 Chicago, Illinois, Gas
Supply Revenue,
6.875% 03/01/15........... Aa3 AA- $ 2,758
Chicago, Illinois,
Metropolitan Water
Reclamation District -
Greater Chicago Capital
Improvement:
2,165 5.750% 12/01/01............ Aa2 AA 2,296
1,100 5.000% 12/01/02............ Aa2 AA 1,151
2,000 Chicago, Illinois, O'Hare
International Airport
Revenue, Passenger
Facility Charge, Series B,
AMT, (AMBAC Insured),
5.000% 01/01/02........... Aaa AAA 2,064
5,000 Chicago, Illinois, Park
District, GO,
6.600% 11/15/14........... A1 AA- 5,713
Chicago, Illinois, School
Financing Authority, GO,
Series A, (MBIA Insured):
2,000 4.800% 06/01/04........... Aaa AAA 2,081
1,160 4.900% 06/01/05........... Aaa AAA 1,216
4,000 Chicago, Illinois, Water
Revenue, (AMBAC Insured),
5.400% 11/01/02........... Aaa AAA 4,234
1,500 Cook County, Illinois,
Capital Improvement, GO,
(FGIC Insured),
5.100% 11/15/03........... Aaa AAA 1,586
2,000 Cook County, Illinois,
Community College District
Number 508, Chicago
Certificates of
Participation, (FGIC
Insured),
8.750% 01/01/07........... Aaa AAA 2,619
Du Page County, Illinois,
GO, Refunded:
100 (Jail Project),
9.000% 01/01/00........... AAA AAA 107
300 (Stormwater Project),
9.000% 01/01/00........... AAA AAA 320
1,145 Du Page County, Illinois,
School District GO, (FGIC
Insured),
6.750% 02/01/11........... Aaa NR 1,399
8,000 Illinois State, EDL
Facilities Authority
Revenues, University of
Chicago, Series B,
4.400% 07/01/25........... Aa1 AA 8,117
1,100 Illinois State, GO,
5.500% 08/01/03........... Aa3 AA 1,179
1,000 Illinois State Health
Facilities Authority
Revenue, (Lutheran General
Health Systems Project),
Series C,
5.250% 04/01/02........... A1 A+ 1,043
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
8
<PAGE> 13
NATIONS FUNDS
Nations Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
ILLINOIS -- (CONTINUED)
$12,500 Illinois State Sales Tax
Revenue Refunding, Series
S,
6.000% 06/15/03........... Aa3 AAA $ 13,658
1,595 Lake County, Illinois, High
School District No. 125,
(Adlai E. Stevenson High
School),
5.000% 01/01/04........... Aa1 NR 1,678
1,050 Lansing, Illinois, Sales
Tax Increment Revenue,
Refunding,
6.500% 12/01/02........... NR BBB 1,145
Metropolitan Pier and
Exposition Authority,
Illinois, Dedicated Tax
Revenue Refunding:
2,400 (MBIA-IBC Insured),
6.500% 06/01/05........... Aaa AAA 2,751
2,000 (McCormick Place Expansion
Project), Series A, (AMBAC
Insured),
6.000% 12/15/06........... Aaa AAA 2,273
Regional Transportation
Authority, Illinois,
Series A,
3,300 (AMBAC Insured), 5.800%
06/01/05.................. Aaa AAA 3,641
1,000 (FGIC Insured),
6.350% 11/01/04........... Aaa AAA 1,096
8,750 Springfield, Illinois,
Airport Authority, Garrett
Aviation Services Project
4.400% 02/01/08........... Aaa AAA 8,843
--------
72,968
--------
INDIANA -- 0.5%
Indiana Health Facilities
Financing Authority,
Hospital Revenue:
2,000 (Clarian Health Partners
Inc. Project), Series A,
5.000% 02/15/04........... Aa3 AA 2,095
(Methodist Hospital Inc.
Project):
1,280 6.200% 09/15/00........... A2 NR 1,340
1,040 6.500% 09/15/02........... A2 NR 1,139
--------
4,574
--------
IOWA -- 1.2%
Iowa Student Loan Liquidity
Corporation, Student Loan
Revenue:
7,000 Series B,
4.900% 12/01/05........... Aaa NR 7,290
3,000 Series C, (AMBAC Insured),
6.500% 12/01/99........... Aaa AAA 3,101
--------
10,391
--------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
KANSAS -- 1.4%
$ 5,000 Kansas State Department of
Transportation, Highway
Revenue
7.250% 03/01/05........... Aa2 AA $ 5,930
5,000 Kansas State Department of
Transportation, Highway
Revenue, (AMBAC Insured)
5.500% 10/01/06........... Aaa AAA 5,520
2,175 Labette County, Kansas,
Single Family Mortgage
Revenue, Refunded,
6.300% 12/01/14++......... AAA A- 1,007
--------
12,457
--------
MAINE -- 0.1%
1,000 Maine State, Municipal
Board Refunding, Series E,
(AMBAC Insured),
5.250% 11/01/04........... Aaa AAA 1,074
--------
MARYLAND -- 2.4%
2,000 Baltimore County, Maryland,
Consolidated Public
Improvement Bonds,
Refunded,
6.900% 04/01/03........... AAA AAA 2,135
1,500 Baltimore, Maryland, Port
Facilities Revenue,
Consolidated Coal Sales,
Series 85,
6.500% 12/01/10........... Aa3 AA 1,661
Maryland State, GO, Third
Series:
4,890 6.250% 07/15/02........... Aaa AAA 5,217
Refunded,
1,500 6.800% 07/15/04........... AAA AAA 1,604
860 Maryland State,
Transportation Authority,
Special Obligation
Revenue, (Baltimore-
Washington D.C.
International Airport
Project), Series A, AMT,
(FGIC Insured),
6.400% 07/01/19........... Aaa AAA 918
1,000 Prince Georges County,
Maryland, Consolidated
Public Improvement, (MBIA
Insured),
5.375% 01/01/09........... Aaa AAA 1,082
3,500 Prince Georges County,
Maryland, Solid Waste
Management Systems
Revenue, (FSA Insured),
5.200% 06/15/06........... Aaa AAA 3,718
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
9
<PAGE> 14
NATIONS FUNDS
Nations Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
MARYLAND -- (CONTINUED)
Washington County,
Maryland, Suburban
Sanitation District
Authority, GO, Refunded:
$ 2,500 Water Supply Revenue,
4.900% 12/01/05........... Aa1 AA $ 2,660
2,000 General Construction
Revenue,
5.000% 06/01/04........... Aa1 AA 2,121
--------
21,116
--------
MASSACHUSETTS -- 4.8%
Massachusetts State,
Refunding, GO:
1,000 Series B,
5.000% 11/01/01........... A1 AA- 1,040
5,000 Series C,
5.000% 08/01/07........... A1 AA- 5,293
12,840 Series C, (AMBAC Insured),
4.950% 08/01/05........... Aaa AAA 13,659
400 Series D, GO,
6.375% 07/01/00........... A1 AA- 419
Massachusetts Educational
Financing Authority,
Educational Loan Revenue,
Issue G, (MBIA Insured):
Series A,
4,500 4.800% 12/01/09............ NR AAA 4,592
Series C:
3,745 4.600% 12/01/08............ NR AAA 3,784
3,325 4.700% 12/01/09............ NR AAA 3,365
6,000 Massachusetts State Water
Resources Authority,
Refunding, Series B, GO,
5.125% 03/01/04........... A A 6,353
2,000 New England Education Loan
Marketing Corporation,
Series A, AMT, GO,
5.700% 07/01/05........... A1 A- 2,133
2,000 University of Lowell,
Building Authority,
Massachusetts Guaranteed
Bond, Series A, (AMBAC
Insured),
5.700% 11/01/09........... Aaa AAA 2,212
--------
42,850
--------
MICHIGAN -- 1.3%
7,500 Detroit, Michigan,
Convention Facilities,
Revenue Refunding, (Cobo
Hall Expansion Project),
(FSA Insured),
5.100% 09/30/04........... Aaa AAA 7,953
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
MICHIGAN -- (CONTINUED)
Detroit, Michigan,
Refunding, GO,
Series B:
$ 1,000 6.750% 04/01/03........... Baa2 BBB+ $ 1,107
2,000 7.000% 04/01/04........... Baa2 BBB+ 2,273
--------
11,333
--------
MINNESOTA -- 1.0%
1,390 Rochester, Minnesota,
Health Care Facilities
Revenue, (Mayo
Foundation/Mayo Medical
Center), Series C,
7.100% 11/15/00........... NR AA+ 1,464
900 St. Paul, Minnesota, Sewer
Revenue Refunding, (AMBAC
Insured),
5.100% 12/01/01........... Aaa AAA 939
Southern Minnesota
Municipal Power Agency,
Power Supply Systems
Revenue, Series B:
2,150 Refunded Balance,
5.800% 01/01/07........... AAA AAA 2,343
3,850 Unrefunded Balance,
5.800% 01/01/07........... A2 A+ 4,146
--------
8,892
--------
MISSISSIPPI -- 1.3%
8,000 Adams County, Mississippi,
Pollution Control Revenue
Refunding, (International
Paper Company), Series A,
5.500% 12/01/05........... A3 A- 8,653
2,370 Mississippi Higher
Education, Series C, (GTD
STD LNS ),
6.400% 01/01/03........... NR A 2,552
--------
11,205
--------
MISSOURI -- 1.8%
4,000 Kansas City, Missouri,
Industrial Development
Authority, Review,
4.900% 12/31/08........... Baa2 NR 4,110
400 Metropolitan Saint Louis,
Missouri, Sewer District,
Mississippi River
Subdistrict, (FGIC
Insured),
6.300% 02/15/01........... Aaa AAA 412
Missouri State: Refunding,
3rd State Building,
Refunding:
300 Series B,
5.500% 11/01/01........... Aaa AAA 317
State Water Pollution
Control, Series B:
200 5.700% 11/01/02........... Aaa AAA 212
300 5.800% 11/01/03........... Aaa AAA 319
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
10
<PAGE> 15
NATIONS FUNDS
Nations Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
MISSOURI -- (CONTINUED)
$ 400 Missouri State Board of
Public Buildings, State
Office Buildings, Special
Obligation,
5.900% 12/01/01........... Aa AA $ 426
1,000 Missouri State
Environmental Improvement
and Energy Resource
Authority, Pollution
Control Revenue,
(Association of Electrical
Cooperation Thomas Hill)
5.500% 12/01/05........... A3 A- 1,097
Missouri State Health and
Educational Facilities
Authority:
300 (Baptist Medical Center),
Series A, 7.300%
07/01/99.................. NR NR 309
5,000 (BJC Health System),
5.000% 08/15/28........... Aa2 AA 4,939
(Christian Health),
Series A, (FGIC Insured):
300 6.400% 02/15/00........... Aaa AAA 311
600 6.600% 02/15/02........... Aaa AAA 651
700 (Sisters of Mercy), Series
E,
7.000% 06/01/99........... Aa1 AA+ 716
1,500 (SSM Health Care),
Series AA, (MBIA Insured),
5.400% 06/01/00........... Aaa AAA 1,540
600 St. Louis County, Missouri,
GO, Pattonville R-3 School
District, (FGIC Insured),
5.700% 02/01/01........... Aaa AAA 628
--------
15,987
--------
MONTANA -- 0.9%
8,000 Forsyth County, Montana,
PCR, Portland General
Electric Company,
Refunding,
4.600% 05/01/34........... A3 A- 8,145
--------
NEBRASKA -- 0.1%
1,000 Nebraska Public Power
District Revenue, Power
Supply System,
5.300% 01/01/02........... A1 A+ 1,047
--------
NEVADA -- 2.0%
6,500 Clark County, Nevada, GO:
(FGIC Insured),
6.900% 09/01/99........... Aaa AAA 6,708
Nevada State, Municipal GO:
1,000 (BD Bank Project), Series
39-A,
6.000% 07/01/01........... NR AA 1,061
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
NEVADA -- (CONTINUED)
$ 5,000 (BD Bank Project 66 & 67),
Series A, (FGIC Insured),
5.000% 05/15/28........... Aaa AAA $ 4,992
1,000 ETM, Refunded,
7.000% 01/01/03........... Aaa AAA 1,069
1,000 Series A,
5.800% 05/01/00........... Aa2 AA 1,033
2,910 Reno, Nevada, GO, Series A,
(FGIC Insured),
5.300% 04/01/05........... Aaa AAA 3,091
--------
17,954
--------
NEW JERSEY -- 1.5%
1,100 Bergen County, New Jersey,
Utilities Authority, Water
Pollution Control Revenue,
Series B,
5.500% 12/15/02........... Aaa AAA 1,175
3,230 Monmouth County, New
Jersey, Refunded,
5.000% 12/01/04........... Aaa AA+ 3,439
5,000 New Jersey State, GO,
Series D,
5.500% 02/15/04........... Aa1 AA+ 5,407
1,100 New Jersey State,
Transportation Trust Fund
Authority, Transportation
System, Refunded, Series
A, (AMBAC Insured),
5.200% 12/15/00........... AAA AAA 1,137
University of Medicine and
Dentistry, New Jersey,
Revenue Bonds, Series C:
1,000 7.000% 12/01/00........... A3 AA- 1,057
1,000 7.000% 12/01/01........... A3 AA- 1,060
--------
13,275
--------
NEW MEXICO -- 0.8%
1,400 Albuquerque, New Mexico,
GO, Series A,
4.700% 07/01/00........... Aa3 AA 1,427
New Mexico Mortgage
Financial Authority, AMT,
(Single Family Mortgage
Project):
1,355 Series C-2
5.950% 07/01/17........... Aaa NR 1,444
2,175 Series E-2,
5.600% 07/01/17........... NR AAA 2,264
2,000 New Mexico State, GO,
(Capital Projects),
5.250% 09/01/03........... Aa1 AA+ 2,053
--------
7,188
--------
NEW YORK -- 5.9%
Metropolitan Transit
Authority, New York,
Commuter Facilities
Revenue:
10,000 5.250% 07/01/17........... Baa1 BBB+ 10,172
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
11
<PAGE> 16
NATIONS FUNDS
Nations Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
NEW YORK -- (CONTINUED)
Series A,
$ 3,235 5.250% 07/01/08............ Baa1 BBB+ $ 3,469
3,000 Municipal Assistance
Corporation for the City
of New York, Series J, (GO
of Corp),
5.750% 07/01/03........... Aa2 AA 3,255
4,565 New York, New York, Series
E, (MBIA Insured),
5.800% 05/15/05........... Aaa AAA 4,971
1,500 New York, New York, City
Municipal Water Finance
Authority,
5.000% 06/15/08........... A2 A- 1,587
1,100 New York State, Serial
Bonds, GO,
6.700% 11/15/99........... A2 A 1,140
5,950 New York State, Refunding,
GO, Series F,
5.000% 09/15/06........... A2 A 6,344
New York State Dormitory
Authority Revenue:
5,000 City University, Series B,
5.250% 07/01/06........... Baa1 BBB+ 5,351
7,000 State University
Educational Facilities,
Series A,
5.400% 05/15/04........... A3 A- 7,496
Westchester County, New
York, GO, Series D:
2,960 4.625% 11/15/07............ Aaa AAA 3,112
1,720 4.625% 11/15/15............ Aaa AAA 1,720
1,680 4.625% 11/15/16............ Aaa AAA 1,670
1,565 4.625% 11/15/17............ Aaa AAA 1,555
--------
51,842
--------
NORTH CAROLINA -- 3.9%
Mecklenburg County, North
Carolina, GO:
3,000 Public Improvement,
Refunding,
6.200% 01/01/04........... AAA AAA 3,252
8,000 Revenue Refunding,
5.750% 03/01/03............ Aaa AAA 8,547
North Carolina Medical Care
Community, Health Care
Facilities Revenue:
4,000 Carolina Medicorp
Project), 5.125%
05/01/16.................. Aa3 AA 4,037
2,500 Duke University Health
System, Series B
4.500% 06/01/07............ Aa3 AA 2,563
Pitt County Memorial
Hospital, Series A:
2,560 5.000% 12/01/07............ Aa3 AA- 2,708
3,135 4.400% 12/01/08............ Aa3 AA- 3,149
5,000 North Carolina State, GO,
Series A,
4.750% 04/01/15........... Aaa AAA 5,080
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
NORTH CAROLINA -- (CONTINUED)
$ 3,550 North Carolina State,
Prison Facilities, Series
B,
4.500% 06/01/07........... Aaa AAA $ 3,683
1,000 Wake County, North
Carolina, Special
Obligations, (Solid Waste
Management Projects),
5.000% 02/01/05........... Aa2 AA 1,063
--------
34,082
--------
OHIO -- 0.4%
3,000 Ohio State, Highway Capital
Improvements, GO, Series
B,
5.000% 05/01/07........... Aa1 AAA 3,228
300 Ohio State, Water
Development Authority
Revenue, Refunded, (Pure
Water Project), Series I,
(MBIA Insured),
7.000% 06/01/99........... Aaa AAA 307
--------
3,535
--------
OKLAHOMA -- 0.6%
5,000 Tulsa County, Oklahoma,
Industrial Authority,
Health Care Revenue, (St.
Francis Hospital Inc.),
Series B,
5.150% 12/15/18........... NR AA 5,256
--------
OREGON -- 0.7%
3,000 Multnomah County, Oregon,
School District Number
1J - Portland, GO,
5.50% 06/01/05............ Aa AA- 3,287
1,300 Portland, Oregon, Sewer
System Revenue, Series A,
5.450% 06/01/03........... A1 A+ 1,390
1,300 Washington County, Oregon,
Sewer Revenue, Series A,
(AMBAC Insured),
5.300% 10/01/01........... Aaa AAA 1,361
--------
6,038
--------
PENNSYLVANIA -- 3.9%
2,890 Erie, Pennsylvania, Water
Authority, Water Revenue,
7.125% 12/01/11........... NR BBB- 3,181
2,000 Geisinger Authority,
Pennsylvania, Health
Systems Revenue, Series A,
6.000% 07/01/01........... Aa2 AA 2,113
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
12
<PAGE> 17
NATIONS FUNDS
Nations Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
PENNSYLVANIA -- (CONTINUED)
Pennsylvania Housing
Finance Agency, Single
Family Mortgage:
$ 9,180 Series 61A,
5.450% 10/01/21............ Aa2 AA+ $ 9,363
Series 62A, AMT:
1,490 5.100% 10/01/10............ Aa2 AA+ 1,537
1,580 5.200% 10/01/11............ Aa2 AA+ 1,630
3,985 Philadelphia, Pennsylvania,
Authority for Industrial
Development Apartment
Revenue, Philadelphia
Apartment System Project -
Series A, (FGIC Insured),
5.000% 07/01/08........... Aaa AAA 4,195
2,500 Philadelphia, Pennsylvania,
Industrial Development
Authority, Industrial
Development Revenue
Refunding, (Ashland Oil
Inc. Project),
5.700% 06/01/05........... Baa2 NR 2,684
9,000 Philadelphia, Pennsylvania,
Water and Wastewater
Systems, (FGIC Insured),
5.500% 06/15/03........... Aaa AAA 9,613
--------
34,316
--------
RHODE ISLAND -- 0.4%
800 Pawtucket, Rhode Island,
GO, (FGIC Insured),
5.250% 04/15/01........... Aaa AAA 830
3,000 Rhode Island State,
Consolidated Capital
Development Loan, Series
A,
5.400% 08/01/06............ A1 AA- 3,152
--------
3,982
--------
SOUTH CAROLINA -- 2.2%
3,210 Greenville Hospital System,
South Carolina, Hospital
Facilities Revenue, Series
B,
5.500% 05/01/08........... Aa3 AA 3,506
Piedmont Municipal Power
Agency, South Carolina,
Electric Revenue, (FGIC
Insured):
2,580 Series A,
6.1250% 01/01/03.......... Aaa AAA 2,798
5,160 Series B,
6.000% 01/01/07........... Aaa AAA 5,806
3,665 Richland County, South
Carolina, Solid Waste
Disposal Facilities
Revenue, (Union Camp
Corporation Project),
Series A,
6.750% 05/01/22........... A1 A- 4,015
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
SOUTH CAROLINA -- (CONTINUED)
$ 3,000 Spartanburg County, South
Carolina, Health Services
District Inc., Hospital
Revenue, Series B, (MBIA
Insured),
5.125% 04/15/17........... Aaa AAA $ 3,049
--------
19,174
--------
SOUTH DAKOTA -- 1.0%
9,000 Education LNS Inc., South
Dakota, (GTD STD LNS),
4.950% 06/01/10........... Aaa NR 9,167
--------
TENNESSEE -- 1.7%
4,500 McMinn County, Tennessee,
Industrial Development
Board, Pollution Control
Revenue, (Calhoun
Newsprint Co. Project),
7.400% 12/01/22........... Baa1 BBB 5,027
1,000 Metropolitan Government,
Nashville and Davidson
County, Tennessee, Health
and Educational Facilities
Board Revenue, Refunding
and Improvement, (Meharry
Medical College Project),
(AMBAC Insured),
6.000% 12/01/08........... Aaa AAA 1,150
2,000 Metropolitan Government,
Nashville and Davidson
County, Tennessee,
Refunding, GO,
5.100% 05/15/14........... Aa2 AA 2,086
5,555 Tennessee State, GO, Series
A,
7.000% 03/01/05........... Aaa AA+ 6,525
--------
14,788
--------
TEXAS -- 11.7%
2,175 Aldine, Texas, Independent
School District, Capital
Appreciation, Refunding,
(PSF-GTD),
5.450% 02/15/07+.......... Aaa AAA 1,539
Austin, Texas, Utilities
Systems Revenue Refunded:
5,000 Series A,
8.000% 11/15/16........... AAA AAA 5,537
2,555 Series 2,
5.600% 10/01/03........... AAA AAA 2,757
980 Brazos, Texas, Higher
Education Authority Inc.,
Revenue Refunding, Senior
Lien, Series A-2, AMT,
(Guaranteed Student
Loans),
6.050% 06/01/03........... Aaa NR 1,057
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
13
<PAGE> 18
NATIONS FUNDS
Nations Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
TEXAS -- (CONTINUED)
Crowley, Texas, Independent
School District, GO,
(PSF-GTD):
$ 5,930 5.125% 08/01/25............ Aaa AAA $ 6,005
6,285 5.125% 08/01/26............ Aaa AAA 6,365
4,905 Dallas County, Texas,
Refunding, Series B,
5.250% 08/15/09........... Aaa AAA 5,369
1,000 Gulf Coast, Texas,
Industrial Development
Authority, (Champion
International Corporation
Project),
7.000% 04/01/04........... Baa1 BBB 1,016
2,350 Harris County, Texas,
Health Facilities
Development Authority,
Hospital Revenue Refunding
(Texas Childrens Hospital
Project), (MBIA Insured),
6.000% 10/01/05........... Aaa AAA 2,621
1,245 Houston, Texas, GO,
6.800% 03/01/01........... Aa3 AA- 1,300
2,500 Houston, Texas, Water Works
and Sewer Revenue, Junior
Lien, Series A, (MBIA
Insured),
5.800% 12/01/04........... Aaa AAA 2,739
1,500 Irving, Texas, Independent
School District, Capital
Appreciation Refunding,
GO, (PSF-GTD),
5.350% 02/15/02+.......... Aaa AAA 1,318
7,520 Lower Colorado River
Authority, Texas, Revenue
Refunding, Junior Lien,
(Fifth Supply), (AMBAC
Insured),
5.300% 01/01/06........... Aaa AAA 8,010
5,000 North Central Texas Health
Facilities Development
Corporation, Health
Facilities Revenue,
(Presbyterian Healthcare),
Series B, (MBIA Insured),
5.500% 06/01/16........... Aaa AAA 5,483
1,100 San Antonio, Texas,
Electric and Gas Revenue
Refunding,
5.200% 02/01/01........... Aa1 AA 1,138
San Antonio, Texas, Water
Revenue, (FGIC Insured):
415 Prerefunded,
5.900% 05/15/00........... NR AAA 430
2,455 Unrefunded Balance,
5.900% 05/15/00........... NR AAA 2,542
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
TEXAS -- (CONTINUED)
$ 2,000 Southwest Higher Education
Authority Inc., Revenue
Refunding, (Southern
Methodist), (FSA Insured),
5.125% 10/01/16........... Aaa AAA $ 2,063
Tarrant County, Texas,
Health Facilities
Development Corporation,
Health Systems Revenue,
Texas Health Resources
Systems, Series A, (MBIA
Insured):
4,805 5.750% 02/15/10............ Aaa AAA 5,351
5,000 5.250% 02/15/17............ Aaa AAA 5,178
3,200 Texas A&M University
Revenue Bonds,
5.950% 05/15/05........... Aa2 AA 3,570
Texas Municipal Power
Agency, Revenue Bonds,
(MBIA Insured):
7,210 5.750% 09/01/12............ Aaa AAA 7,733
4,790 5.750% 09/01/12............ Aaa AAA 5,137
900 Texas State, Texas Public
Finance Authority, Series
B,
5.000% 10/01/01........... Aa2 AA 934
1,100 Texas State, Revenue
Refunding, Series C,
5.350% 04/01/01........... Aa2 AA 1,145
5,500 Texas State, Public Finance
Authority, Building
Revenue, (MBIA Insured),
6.600% 02/01/00........... Aaa AAA 5,712
1,000 Texas State, Revenue
Refunding, Veterans
Housing Assistance, Series
B-4, AMT,
6.100% 12/01/06........... Aa2 AA 1,083
300 University of Texas:
Permanent University Fund,
Refunding:
6.700% 07/01/05............ AAA AAA 329
5,335 (PUFG Insured),
4.700% 07/01/09............ Aaa AAA 5,510
4,965 University Revenue Bonds,
Financing System, Series
B,
4.500% 08/15/12........... Aa1 AAA 4,939
--------
103,910
--------
UTAH -- 0.7%
Cache County, Utah, School
District, Refunding, Utah
School Board Guaranty
Program, (SCH BD GTY),
2,995 5.500% 06/15/06............ NR AAA 3,292
2,145 5.500% 06/15/07............ NR AAA 2,373
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
14
<PAGE> 19
NATIONS FUNDS
Nations Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
UTAH -- (CONTINUED)
$ 300 Davis County, Utah, School
District, (FGIC Insured),
6.450% 06/01/02........... Aaa AAA $ 325
--------
5,990
--------
VIRGINIA -- 6.6%
6,170 Chesapeake, Virginia, GO,
5.000% 12/01/03........... Aa3 AA 6,526
4,000 Chesterfield County,
Virginia, Refunding and
Improvement, GO,
6.250% 07/15/05........... Aaa AAA 4,335
6,000 Covington-Allegheny County,
Virginia, Industrial
Development Authority,
PCR, (Westvaco Corporation
Project),
5.900% 03/01/05........... A1 A 6,679
Fairfax County, Virginia,
GO:
1,100 Series A, (ST AID
WITHHLDG),
4.700% 06/01/00........... Aaa AAA 1,121
5,790 Series C, (ST AID
WITHHLDG),
5.000% 05/01/05........... Aaa AAA 6,167
2,500 Newport News, Virginia, GO,
Series B, (ST AID
WITHHLDG),
5.400% 11/01/06........... Aa2 AA 2,704
1,000 Norfolk, Virginia, GO,
5.250% 06/01/01........... A1 AA 1,040
1,500 Norfolk, Virginia,
Industrial Development
Authority, Industrial
Development Revenue,
(Sentara Hospitals),
Series A,
4.600% 11/01/04........... Aa2 AA 1,552
3,000 Virginia Beach, Virginia,
GO,
5.100% 07/15/05........... Aa2 AA 3,213
2,600 Virginia College Building
Authority, Virginia
Educational Facilities
Revenue, (University of
Richmond Project),
5.625% 11/01/02........... Aa2 AA- 2,720
1,100 Virginia State, Higher
Educational Institutions,
Series C,
5.900% 06/01/05........... Aaa AAA 1,181
1,500 Virginia State, Public
Facilities, Series A,
5.400% 06/01/05........... Aaa AAA 1,624
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
VIRGINIA -- (CONTINUED)
Virginia State, Public
School Authority Revenue:
Series A:
$ 2,265 6.000% 01/01/00............ Aa AA $ 2,333
1,520 6.000% 01/01/00............ Aa AA 1,559
Series B:
7,000 5.250% 01/01/07............ Aa AA 7,521
7,620 5.250% 08/01/09............ Aa1 AA+ 8,304
--------
58,579
--------
WASHINGTON -- 8.8%
King County, Washington,
GO, Series A:
510 Unrefunded,
5.250% 12/01/01........... Aa1 AA+ 534
90 Prerefunded,
5.250% 12/01/01........... Aa1 AA+ 94
2,500 Series C,
5.625% 06/01/02........... Aa1 AA+ 2,661
King County, Washington,
Sewer Revenue,GO, Series
B:
Unrefunded,
5,165 4.750% 01/01/17............ Aa1 AA+ 5,146
8,525 4.750% 01/01/18............ Aa1 AA+ 8,450
1,195 King County, Washington,
School District Number
415-Kent, (FSA Insured),
5.100% 06/01/04........... Aaa AAA 1,268
3,000 Pierce County, Washington,
School District Number
003-Puyallup, GO, (FGIC
Insured),
5.000% 12/01/03........... Aaa AAA 3,164
Port Seattle, Washington
Passenger Facilities
Charge Revenue, AMT,
Series B (AMBAC Insured):
5,465 5.000% 12/01/04............ Aaa A2 5,727
6,075 5.000% 12/01/08............ Aaa A2 6,371
1,500 Snohomish County,
Washington, School
District Number 103, (FGIC
Insured),
5.150% 06/01/05........... Aaa AAA 1,606
400 Spokane, Washington, GO,
8.500% 01/01/00........... Aa3 AA 424
1,000 Tacoma, Washington, GO,
Series A,
5.750% 07/01/02........... A1 A+ 1,066
Tacoma, Washington,
Electric Systems Revenue:
800 (FGIC Insured),
5.500% 01/01/01........... Aaa AAA 831
2,500 Series B, (AMBAC Insured),
5.900% 01/01/05........... Aaa AAA 2,691
Washington State, GO:
Series B:
1,000 6.550% 08/01/00............ Aa1 AA+ 1,052
500 6.300% 06/01/02............ Aa1 AA+ 533
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
15
<PAGE> 20
NATIONS FUNDS
Nations Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
WASHINGTON -- (CONTINUED)
$ 3,500 Series R-92-A,
6.400% 09/01/03........... Aa1 AA+ $ 3,772
900 Series R-92-C,
5.600% 09/01/01........... Aa1 AA+ 948
900 Series R-93-A,
5.250% 10/01/00........... Aa1 AA+ 928
10,000 Series R-93-B,
5.125% 10/01/04........... Aa1 AA+ 10,678
3,840 Washington State, Housing
Finance Commission, Series
1A, (GNMA/FNMA COLL),
5.25% 12/01/18............ Aaa NR 3,909
Washington State Public
Power Supply System,
Revenue Refunding:
2,000 (Nuclear Project No. 1),
Series A,
6.500% 07/01/03........... Aa1 AA- 2,163
1,000 (AMBAC Insured),
5.500% 07/01/04........... Aaa AAA 1,076
1,150 (Nuclear Project No. 2),
Series A, 5.800%
07/01/07.................. Aa1 AA- 1,276
7,500 (Nuclear Project No. 2),
Series C, (FGIC Insured),
7.000% 07/01/01........... Aaa AAA 8,111
3,000 (Nuclear Project No. 3),
Series B, (FSA Insured),
5.400% 07/01/05........... Aaa AAA 3,232
--------
77,711
--------
WEST VIRGINIA -- 0.2%
2,000 West Virginia State,
Building Community Lease
Revenue, (West Virginia
Regional Jail and
Correction), Series A,
(MBIA Insured),
6.700% 07/01/02........... Aaa AAA 2,142
--------
WISCONSIN -- 3.0%
300 Milwaukee, Wisconsin, GO,
Series BZ,
6.375% 06/15/03........... Aa1 AA+ 321
Milwaukee, Wisconsin,
Metropolitan Sewer
District, GO, Series A:
300 7.000% 09/01/00............ Aa1 AA+ 318
400 6.700% 10/01/00............ Aa1 NR 424
5,000 6.700% 10/01/01............ Aa1 NR 5,427
3,000 5.500% 10/01/09............ Aa1 AA+ 3,343
3,070 Sun Praire, Wisconsin, Area
School District,
Promissary Notes, (FGIC
Insured),
5.500% 04/01/03........... Aaa AAA 3,277
2,735 Wisconsin Housing &
Economic Development
Authority, Series G, GO,
5.350% 03/01/12........... Aa2 UR 2,833
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
WISCONSIN -- (CONTINUED)
Wisconsin State, GO:
$ 600 Series A,
5.750% 05/01/00............ Aa2 AA $ 620
300 Series D,
6.000% 05/01/00............ Aa2 AA 311
Wisconsin State, Refunding,
GO:
900 Series 1,
5.100% 11/01/01............ Aa2 AA 937
Series 2,
4,760 5.000% 05/01/06............ 5,069
3,625 5.125% 11/01/08............ Aa2 AA 3,923
--------
26,803
--------
TOTAL MUNICIPAL BONDS AND NOTES
(Cost $863,993).................... 916,806
--------
</TABLE>
<TABLE>
<CAPTION>
SHARES
- ----------
<C> <S> <C> <C>
INVESTMENT COMPANY -- 0.9% (Cost $8,115)
8,115,000 AIM Tax-Exempt Fund........................ 8,115
--------
TOTAL INVESTMENTS
(Cost $872,108*)................... 104.5% 924,921
--------
OTHER ASSETS AND
LIABILITIES (NET).................. (4.5)
Cash....................................... 1
Receivable for investment securities
sold...................................... 12,183
Receivable for fund shares sold............ 851
Dividends and interest receivable.......... 13,083
Other assets............................... 1
Payable for fund shares redeemed........... (3,733)
Investment advisory fee payable............ (259)
Administration fees payable................ (60)
Shareholder servicing and distribution
fees payable.............................. (22)
Payable for investment securities
purchased................................. (25,946)
Accrued trustees' fees and expenses........ (23)
Accrued expenses and other liabilities..... (163)
--------
TOTAL OTHER ASSETS AND
LIABILITIES (NET)......................... (4,087)
--------
NET ASSETS.......................... 100% $920,834
--------
-------
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
PRIMARY A SHARES:
($903,899,000/86,536,605 shares
outstanding).............................. $10.45
========
INVESTOR A SHARES:
($13,043,000/1,248,639 shares
outstanding).............................. $10.45
========
INVESTOR B SHARES:
($2,294,000/219,584 shares outstanding).... $10.45
========
INVESTOR C SHARES:
($1,598,000/152,941 shares outstanding).... $10.45
========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
16
<PAGE> 21
NATIONS FUNDS
Nations Intermediate Municipal Bond Fund
STATEMENT OF NET ASSETS (CONTINUED)
SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
(000)
- -------------------------------------------------------------------
<S> <C>
NET ASSETS CONSIST OF:
Undistributed net investment income........ $ 553
Accumulated net realized gain
on investments sold....................... 2,058
Net unrealized appreciation of
investments............................... 52,813
Paid-in capital............................ 865,410
--------
NET ASSETS................................. $920,834
========
</TABLE>
- ---------------
* Federal Income Tax Information: Net unrealized appreciation of investment
securities was comprised of gross appreciation of $52,820,000 and gross
depreciation of $7,000 for federal income tax purposes. At September 30, 1998,
the aggregate cost of securities for federal income tax purposes was
$872,108,000.
+ Zero coupon security. The rate shown reflects the yield to maturity.
Nations Intermediate Municipal Bond Fund had the following insurance
concentration greater than 10% at September 30, 1998 (as a percentage of net
assets):
MBIA 11.99%
AMBAC 10.40%
SEE NOTES TO FINANCIAL STATEMENTS.
17
<PAGE> 22
NATIONS FUNDS
Nations Municipal Income Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 98.8%
ALABAMA -- 2.8%
$ 2,000 Birmingham, Alabama,
Refunding, GO, Series B,
6.250% 04/01/12............ A3 AA $ 2,184
3,000 Butler County, Alabama,
Industrial Development
Board, Solid Waste Disposal
Revenue, (James River
Corporation Project),
8.000% 09/01/28............ NR BBB- 3,455
7,210 Courtland, Alabama,
Industrial Development
Board, Solid Waste Disposal
Revenue, 5.750% 11/01/27... Baa1 NR 7,445
2,400 Daphne, Alabama, Special
Care Facilities Financing
Authority Revenue,
Refunding, Presbyterian
Retirement, Series A,
7.300% 08/15/18............ NR NR 2,627
2,000 Jefferson County, Alabama,
Warrants, Sewer Revenue
Refunding, Series A, (FGIC
Insured), 5.625%
02/01/22................... Aaa AAA 2,154
1,000 Morgan County-Decatur,
Alabama, Healthcare
Authority, Hospital Revenue
Refunding, (Decatur General
Hospital), (CONNIE LEE
Insured), 6.250%
03/01/13................... NR AAA 1,106
--------
18,971
--------
ALASKA -- 2.0%
1,500 Alaska Student Loan
Corporation, Student Loan
Revenue, Series A, (AMBAC
Insured), 5.250%
07/01/07................... Aaa AAA 1,581
Anchorage, Alaska, Electric
Utilities Revenue
Refunding,
1,000 Senior Lien, (MBIA Insured):
8.000% 12/01/09............ Aaa AAA 1,332
7,000 Series B, 5.500% 02/01/26... Aaa AAA 7,419
2,250 Anchorage, Alaska, Telephone
Utilities Revenue
Refunding, Series A, (AMBAC
Insured), 4.500%
12/01/02................... Aaa AAA 2,309
1,000 North Slope Boro, Alaska,
Capital Appreciation, GO,
Series A, (MBIA Insured),
5.750% 06/30/06++.......... Aaa AAA 726
--------
13,367
--------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
ARIZONA -- 2.3%
$ 2,000 Maricopa County Arizona,
Unified School District No.
93-Cave Creek, GO, Series
A, (FGIC Insured), 5.900%
07/01/06................... Aaa AAA $ 2,153
4,000 Maricopa County Arizona,
Unified School District No.
4-Mesa, Capital
Appreciation, GO, Refunded,
(FGIC Insured), 0.000%
07/01/02++................. Aaa AAA 3,469
Maricopa County, Arizona,
Unified School District No.
48, (Scottsdale Refunding),
Series B:
1,000 6.300% 07/01/04............. Aa2 AA 1,127
1,300 4.600% 07/01/11............. Aa2 AA 1,318
3,000 Maricopa County, Arizona,
School District No. 006,
Washington Elementary,
Series C, (FGIC Insured),
4.000% 07/01/10............ Aaa AAA 2,912
2,000 Salt River Project Arizona
Agriculture Improvement and
Power District, Arizona,
Electric System Revenue,
Series C, 6.250%
01/01/19................... Aa2 AA 2,161
5,000 Tucson and Pima County,
Arizona, Industrial
Development Authority,
Single Family Mortgage
Revenue, Capital
Appreciation, Series
1983-A, 11.000%
12/01/14++................. AAA NR 2,352
--------
15,492
--------
ARKANSAS -- 0.8%
1,300 Arkansas State Development
Finance Authority, Waste
Water Systems Revenue,
Revolving Ln Fd, Series A,
5.700% 12/01/12............ NR AA 1,419
3,425 Blytheville, Arkansas, Solid
Waste Recycling and Sewer
Treatment Revenue, (Nucor
Corporation Project),
6.375% 01/01/23............ A1 AA- 3,669
--------
5,088
--------
CALIFORNIA -- 2.9%
California State, Department
of Water Reserves Central
VY Project Revenue:
3,000 Water System - Series 0,
5.000% 12/01/12............ Aa2 AA 3,139
1,460 Water System - J2,
Unrefunded Balance, 6.125%
12/01/13................... Aa2 AA 1,548
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
18
<PAGE> 23
NATIONS FUNDS
Nations Municipal Income Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
CALIFORNIA -- (CONTINUED)
California State, GO:
$ 1,000 7.100% 09/01/02............. A1 A+ $ 1,126
1,000 7.000% 08/01/04............. A1 A+ 1,170
1,000 Los Angeles, California,
Waste Water Systems Revenue
Refunding, Series C, (MBIA
Insured), 5.500%
06/01/14................... Aaa AAA 1,066
Metropolitan Water District
of Southern California,
Waterworks Revenue, Series
A, (MBIA Insured):
2,000 5.750% 07/01/15............. Aaa AAA 2,199
3,000 5.500% 07/01/19............. Aa2 AA 3,110
2,595 San Franscisco, California,
City and County Airport
Commission, International
Airport Revenue, Second
Series, Issue 9B, (FGIC
Insured), 5.250%
05/01/13................... Aaa AAA 2,750
3,500 Southern California Public
Power Authority, (Palo
Verde Project), Refunding,
Series A, 5.000%
07/01/15................... A2 AA- 3,525
--------
19,633
--------
COLORADO -- 0.7%
1,500 Arapahoe County, Colorado,
Capital Improvement,
Transportation, Federal
Highway Revenue Bonds,
Series E-470, 6.900%
08/31/15................... AAA NR 1,803
2,500 Douglas County, Colorado,
Sales and Use Tax Revenue,
(MBIA Insured), 5.500%
10/15/11................... Aaa AAA 2,708
--------
4,511
--------
CONNECTICUT -- 0.7%
1,000 Connecticut State, GO,
Series A, 5.300%
05/15/10................... Aa3 AA- 1,080
Connecticut State Housing
Finance Authority Revenue,
(Housing Mortgage Finance
Program):
1,610 Series A, 6.100% 05/15/13... Aa2 AA 1,717
1,590 Series B, 6.700% 11/15/12... Aa3 AA 1,725
--------
4,522
--------
DISTRICT OF COLUMBIA -- 1.7%
7,000 District of Columbia,
Hospital Revenue Refunding,
(Medlantic Healthcare
Group), Series A, (MBIA
Insured), 5.375%
08/15/15................... Aaa AAA 7,368
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
DISTRICT OF COLUMBIA -- (CONTINUED)
$ 3,905 District of Columbia,
Revenue Refunding, (Howard
University), (MBIA
Insured), 5.750%
10/01/12................... Aaa AAA $ 4,273
--------
11,641
--------
FLORIDA -- 6.7%
Florida State Board of
Education, Capital Outlay,
Public Education, GO,
Series A:
1,000 5.500% 06/01/14............. Aa2 AA+ 1,068
3,000 5.000% 01/01/17............. Aa2 AA+ 3,033
1,735 Unrefunded Balance, 9.125%
06/01/14................... Aa2 AA+ 2,534
2,000 Florida State Department,
General Services Division,
Facilities Management
Revenue Refunding, (Florida
Facilities Pool), Series B,
(AMBAC, Insured), Series B,
5.700% 09/01/20............ Aaa AAA 2,155
3,400 Florida State Division,
Board Finance Department,
General Services Revenue,
Department National
Resources, (Preservation
2000), Series A, (AMBAC
Insured), 6.700%
07/01/05................... AAA AAA 3,735
3,500 Hillsborough County,
Florida, Industrial
Development Authority,
Pollution Control Revenue
Refunding, (Tampa Electric
Project), 8.000%
05/01/22................... Aa3 AA 4,063
3,000 Jacksonville, Florida, PCR,
Refunding, (Anheuser-Busch
Companies Project), 5.700%
08/01/31................... A1 A+ 3,236
3,900 Martin County, Florida,
Industrial Development
Authority Revenue,
(Indiantown Cogeneration
Project), AMT, Series A,
7.875% 12/15/25............ Baa3 BBB- 4,590
1,000 North Broward Hospital
District, Florida, Hospital
Revenue Refunding, (MBIA
Insured), 6.250%
01/01/06................... AAA AAA 1,095
Orlando, Florida, Community
Water and Electric
Utilities Revenue
Refunding:
1,500 Series A, 5.000% 10/01/20... Aa2 AA- 1,498
1,200 Series D, 6.750% 10/01/17... Aa2 AA- 1,493
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
19
<PAGE> 24
NATIONS FUNDS
Nations Municipal Income Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
FLORIDA -- (CONTINUED)
$ 1,000 Orlando and Orange County
Expressway Authority,
Florida Expressway Revenue,
Junior Lien, (FGIC
Insured), 6.500%
07/01/10................... Aaa AAA $ 1,208
12,115 Polk County, Florida,
Industrial Development
Authority, Solid Waste
Disposal Facilities
Revenue, (Tampa Electric
Company Project), 5.850%
12/01/30................... Aa2 AA 13,164
2,000 South Broward, Florida,
Hospital District Revenue
Refunding, (FSA Insured),
5.500% 05/01/28............ Aaa AAA 2,076
--------
44,948
--------
GEORGIA -- 8.5%
1,100 Atlanta, Georgia, GO, 5.600%
12/01/11................... Aa3 AA 1,186
5,500 Brunswick & Glynn County,
Georgia, Development
Authority Revenue,
Refunding, (Georgia Pacific
Corporation Project),
5.550% 03/01/26............ Baa2 NR 5,593
1,000 Cartersville, Georgia,
Development Authority
Revenue, Sewer Facilities,
(Anheuser Busch), 6.125%
05/01/27................... A1 A+ 1,100
2,000 Coweta County, Georgia,
School System, GO, 6.300%
08/01/11................... A A 2,216
2,500 De Kalb County, Georgia, GO,
Refunding, 5.250%
01/01/20................... Aa1 AA+ 2,565
2,000 De Kalb County, Georgia,
School District, GO, Series
A, 6.250% 07/01/09......... Aa AA 2,357
3,000 Effingham County, Georgia,
Development Authority Solid
Waste Disposal Revenue,
(Fort James Project),
5.625% 07/01/18............ Baa2 BBB- 3,050
4,750 Fulco, Georgia, Hospital
Authority Revenue,
Anticipation Certificates,
(Saint Josephs Hospital),
5.500% 10/01/18............ A3 A 5,090
Georgia State, GO:
3,000 Refunding, Series A, 6.250%
03/01/06................... Aaa AAA 3,448
Series B:
3,000 6.250% 04/01/07............. Aaa AAA 3,492
3,000 6.250% 03/01/11............. Aaa AAA $ 3,555
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
GEORGIA -- (CONTINUED)
$ 1,650 Gwinnett County, Georgia,
Certificates of
Participation, Water and
Sewer, 8.600% 08/01/03..... Aaa AAA 1,995
Metropolitan Atlanta Rapid
Transit Authority (MARTA),
Georgia, Sales Tax Revenue
Refunding:
2,080 Series M, 6.350%
07/01/04................... A1 AA- 2,245
Series P, (AMBAC Insured):
1,000 6.000% 07/01/04............. Aaa AAA 1,110
1,000 6.100% 07/01/05............. Aaa AAA 1,128
2,000 6.250% 07/01/20............. Aaa AAA 2,407
2,000 Monroe County, Georgia,
Development Authority, PCR,
(Oglethorpe Power
Corporation), Series A,
6.800% 01/01/11............ A3 A 2,427
Savannah, Georgia, Hospital
Authority, Revenue
Refunding and Improvement:
3,000 (Candler Hospital Project),
Pre Refunded, 7.000%
01/01/23................... Ba1 BB 3,403
2,000 (St. Joseph's Hospital
Project), Pre Refunded,
6.125% 07/01/12............ A2 NR 2,224
2,690 Union County, Georgia,
Housing Authority, Multi-
family Housing Revenue
Refunding, (Hidden Lake
Apartments), Series A,
(FHA/FNMA COLL), 7.125%
12/01/25................... Aaa NR 2,954
3,000 White County, Georgia,
Industrial Development
Authority Revenue
Refunding, (Clark-Schwebel
Fiber Glass Company
Project), 6.850%
06/01/10................... NR BBB+ 3,228
--------
56,773
--------
HAWAII -- 1.4%
1,900 Hawaii State Department of
Budget and Finance, Special
Purpose Mortgage Revenue,
(Hawaiian Electric Company
and Subsidiaries), (MBIA
Insured), 6.550%
12/01/22................... Aaa AAA 2,096
3,000 Hawaii State, GO, Series CN,
(FGIC Insured), 6.250%
03/01/04................... Aaa AAA 3,332
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
20
<PAGE> 25
NATIONS FUNDS
Nations Municipal Income Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
HAWAII -- (CONTINUED)
$ 1,500 Honolulu, Hawaii, City and
County, Refunding and
Improvement, GO, Series B,
8.000% 10/01/10............ A2 AA $ 2,001
2,100 Maui County, Hawaii,
Refunding, GO, (FGIC
Insured), 5.000%
09/01/03................... Aaa AAA 2,204
--------
9,633
--------
ILLINOIS -- 4.9%
3,385 Chicago, Illinois,
Metropolitan Water
Reclamation District,
(Greater Chicago), Capital
Improvement Bonds, 6.900%
01/01/07................... Aa2 AA 4,044
Chicago, Illinois, O'Hare
International Airport,
Revenue Refunding:
2,640 Sr Lien - Series A, 5.000%
01/01/16................... A1 A+ 2,637
3,000 Second Lien, Series C,
(MBIA Insured), 5.000%
01/01/18................... Aaa AAA 3,014
1,500 Special Facilities,
(American Airlines Inc.
Project), 8.200%
12/01/24................... Baa2 BBB- 1,798
2,000 Chicago, Illinois, Park
District, GO, (MBIA
Insured),
5.500% 01/01/16............ Aaa AAA 2,139
2,000 Cook County, Illinois,
Capital Improvement, GO,
(FGIC Insured),
5.900% 11/15/16............ Aaa AAA 2,280
1,000 Cook County, Illinois,
Forest Preserve District,
(Zoo), GO, (MBIA Insured),
5.800% 11/01/16............ Aaa AAA 1,082
1,850 Glendale Heights, Illinois,
Hospital Revenue, (Glendale
Heights Project), Revenue
Refunding, Series B,
7.100% 12/01/15............ AAA AAA 2,247
1,800 Illinois Educational
Facilities Authority
Reserves, (NorthWestern
University),
5.375% 12/01/21............ Aa1 AA+ 1,857
Illinois State Development
Finance Authority, PCR,
Refunding:
4,000 (Commonwealth Edison
Company Project),
7.250% 06/01/11............ Baa2 BBB 4,328
1,000 (Edison Company Project),
Series D, (AMBAC Insured),
6.750% 03/01/15............ Aaa AAA 1,145
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
ILLINOIS -- (CONTINUED)
$ 2,000 Illinois State, GO, (MBIA
Insured),
6.000% 02/01/16............ Aaa AAA $ 2,198
1,500 Illinois State Sales Tax
Revenue Refunding, Series
V,
6.375% 06/15/17............ Aa3 AAA 1,706
2,680 Southern Illinois University
Revenue, Capital
Appreciation, Housing and
Auxilary Facilities
Systems, (MBIA Insured),
5.100% 04/01/06++.......... Aaa AAA 1,965
--------
32,440
--------
INDIANA -- 4.0%
2,500 Franklin, Indiana, Economic
Development Revenue
Refunding, (Hoover
Universal Inc. Project,
Guaranteed by Johnson
Controls Inc.),
6.100% 12/01/04............ A2 A 2,773
Hamilton South Eastern
Indiana, North Delaware
School Building
Corporation, First
Mortgage, (AMBAC Insured):
1,000 5.000% 07/15/07............. Aaa AAA 1,068
1,000 5.100% 07/15/09............. Aaa AAA 1,073
1,000 Hammond, Indiana, PCR,
(Stauffer Chemical
Project),
8.000% 11/01/12............ A1 NR 1,067
1,000 Indiana Health Facility,
Financing Authority,
Hospital Revenue, (Clarian
Health Partners,
Incorporated), Series A,
5.500% 02/15/16............ Aa3 AA 1,053
3,000 Indiana State, Financing
Authority Toll Road
Revenue,
6.000% 07/01/15............ A1 A 3,006
Indianapolis, Indiana,
Airport Authority, Special
Facilities Revenue,
(Federal Express
Corporation Project):
2,000 7.100% 01/15/17............. Baa2 BBB 2,266
Refunding,
10,000 5.500% 05/01/29............. Baa2 BBB 10,059
Saint Joseph County,
Indiana, Educational
Facilities Revenue,
University of Notre Dame,
(Du Lac Project):
2,000 5.250% 03/01/21............. Aaa NR 2,049
2,000 5.500% 03/01/26............. Aaa NR 2,096
--------
26,510
--------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
21
<PAGE> 26
NATIONS FUNDS
Nations Municipal Income Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
KANSAS -- 0.7%
$ 2,000 Kansas City, Kansas,
Utilities System Revenue
Refunding and Improvement,
(FGIC Insured),
6.250% 09/01/14............ Aaa AAA $ 2,254
2,000 Kansas State, Department of
Transportation, Highway
Revenue, Series A,
6.000% 09/01/07............ Aa2 AA 2,199
--------
4,453
--------
KENTUCKY -- 0.2%
1,000 Kentucky State Turnpike
Authority, Economic
Development, Revenue
Refunding, (Revitalization
Projects), (AMBAC Insured),
5.500% 07/01/08............ Aaa AAA 1,112
--------
MAINE -- 0.2%
1,000 Maine State, Health and
Higher Educational
Facilities Authority
Revenue, Series B, (AMBAC
Insured),
5.500% 07/01/16............ Aaa AAA 1,061
--------
MASSACHUSETTS -- 3.5%
2,885 Massachusetts Bay
Transportation Authority,
General Transportation
Systems, Series A,
5.750% 03/01/18............ A1 AA- 3,223
3,750 Massachusetts State,
Refunding, GO, (AMBAC
Insured), Series A,
5.200% 11/01/12............ Aaa AAA 3,975
Massachusetts State,
Consolidated Loan, GO:
2,500 Series A, (MBIA Insured),
5.750% 02/01/13............ Aaa AA- 2,775
2,000 Series B, (FGIC Insured),
5.500% 06/01/10............ Aaa AAA 2,188
7,400 Massachusetts State Port
Authority, Revenue Bonds,
Special Facilities,
(Bosfuel Project), (MBIA
Insured), 5.750%
07/01/39................... Aaa AAA 7,908
3,000 Massachusetts State, Water
Reserves Authority,
Refunding, Series B, 6.250%
11/01/10................... A1 A 3,281
--------
23,350
--------
MICHIGAN -- 1.9%
1,670 Byron Center, Michigan,
Public Schools, GO, (MBIA
Insured), 5.970%
05/01/15................... Aaa AAA 1,880
1,000 Detroit, Michigan,
Refunding, Series B, 6.375%
04/01/07................... Baa2 BBB+ 1,120
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
MICHIGAN -- (CONTINUED)
$ 1,250 Kalamazoo, Michigan, City
School District, Refunding,
GO, (FGIC Insured), 5.650%
05/01/14................... Aaa AAA $ 1,353
1,000 Lakeshore, Michigan, Public
Schools, GO, (MBIA
Insured), 5.750%
05/01/15................... Aaa AAA 1,080
3,000 Michigan State,
Comprehensive
Transportation, Refunding,
Series A, (MBIA Insured),
5.250% 08/01/13............ Aaa AAA 3,166
1,000 Michigan State,
Environmental Protection
Program, GO, 6.250%
11/01/12................... Aa1 AA+ 1,180
2,000 Michigan State Hospital
Finance Authority, Hospital
Revenue, (Holland Community
Hospital), (AMBAC Insured),
5.625% 01/01/28............ Aaa AAA 2,132
1,000 Michigan State Trunk Line,
Series A, (FGIC Insured),
5.625% 11/15/14............ Aaa AAA 1,076
--------
12,987
--------
MISSISSIPPI -- 1.7%
5,000 Adams County Mississippi,
PCR, Refunded,
(International Paper
Company), Series A, 5.500%
12/01/05................... A3 A- 5,408
3,000 Lowndes County, Mississippi,
Solid Waste Disposal & PCR,
Refunding, (Weyerhaeuser
Company Project), Series A,
6.800% 04/01/22............ A2 A 3,800
2,200 Mississippi, Hospital
Equipment and Facilities
Authority Revenue,
Refunding and Improvement,
(North Mississippi Health
Services), (AMBAC Insured),
5.400% 05/15/04............ Aaa AAA 2,354
--------
11,562
--------
MISSOURI -- 3.5%
1,000 Independence, Missouri,
School District, GO, 6.250%
03/01/11................... A3 NR 1,181
4,140 Joplin, Missouri, Industrial
Development Authority
Revenue, 5.125% 12/01/15... Aa2 AA 4,205
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
22
<PAGE> 27
NATIONS FUNDS
Nations Municipal Income Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
MISSOURI -- (CONTINUED)
Missouri State Environmental
Improvement and Energy
Resource Authority:
$ 1,100 Environment Improvement
Resources, (Union Electric
Company Project), Series A,
(AMBAC Insured), 7.400%
05/01/20................... Aaa AAA $ 1,181
1,000 Water Pollution Control,
State Revolving Fund,
(Kansas City), Series A,
5.750% 01/01/16............ Aa1 NR 1,071
6,000 Missouri State Health and
EDL Facility Authority, EDL
Facilities Revenue, 5.000%
11/15/37................... Aa1 AA+ 6,005
1,595 Missouri State Housing
Development Commission,
Mortgage Revenue, Single
Family-Homeowner Loan,
Series A, 6.100%
09/01/14................... NR AAA 1,699
1,625 Missouri State Water PCR,
Series A, 5.600%
04/01/15................... Aaa AAA 1,761
3,500 Sikeston, Missouri, Electric
Revenue, Refunding, (MBIA
Insured), 6.100%
06/01/07................... Aaa AAA 4,025
2,000 University of Missouri,
Health Facilities Revenue,
(University of Missouri
Health Systems), Refunding,
Series A, (AMBAC Insured),
5.500% 11/01/16............ Aaa AAA 2,125
--------
23,253
--------
MONTANA -- 1.2%
8,000 Forsyth, Montana, PCR,
Portland General Electric
Company, 4.600% 05/01/33... A3 A- 8,145
--------
NEVADA -- 1.5%
1,400 Clark County, Nevada,
Refunding and Improvement-
Transportation, Series A,
(MBIA Insured), 6.000%
06/01/12................... Aaa AAA 1,561
1,000 Las Vegas-Clark County,
Nevada, Library District,
GO, Series A, (FGIC
Insured), 6.000%
02/01/12................... Aaa AAA 1,085
2,000 Nevada State, GO, (Project
No. 40-41-A), 6.375%
12/01/17................... NR AAA 2,165
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
NEVADA -- (CONTINUED)
$ 5,000 Nevada State, Municipal Bond
Bank Projects 66 & 67 -
Series A, (FGIC Insured),
5.000% 05/15/28............ Aaa AAA $ 4,992
--------
9,803
--------
NEW HAMPSHIRE -- 0.4%
2,350 New Hampshire State, Higher
Education & Health
Facilities Authority
Revenue, University System
of New Hampshire, (MBIA
Insured), 5.750%
07/01/24................... Aaa AAA 2,470
--------
NEW JERSEY -- 0.7%
1,130 New Jersey State, Highway
Authority, Garden State
Parkway Generated Revenue,
6.500% 01/01/11............ N/A AAA 1,278
3,000 New Jersey State,
Transportation Trust Fund
Authority, (Transportation
Systems Project), Series B,
(MBIA Insured), 5.000%
06/15/04................... Aaa AAA 3,175
--------
4,453
--------
NEW MEXICO -- 0.5%
2,000 New Mexico Mortgage Finance
Authority, AMT, Single
Family Mortgage Program,
Series C-2,
(GNMA/FNMA/FHLMC COLL),
6.050% 07/01/28............ Aaa NR 2,121
1,000 Santa Fe, New Mexico, Gross
Receipts Tax Revenue,
Refunding, Series A, (AMBAC
Insured), 5.000%
06/01/07................... Aaa AAA 1,068
--------
3,189
--------
NEW YORK -- 2.9%
Municipal Assistance
Corporation for New York
City, New York:
2,000 Series E, 5.200% 07/01/08... Aa2 AA 2,156
5,000 Series J, 5.500% 07/01/02... Aa2 AA 5,307
1,000 New York State Dorm
Authority, Revenue Bonds,
(Canisius College), 5.300%
07/01/08................... Aaa AAA 1,081
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
23
<PAGE> 28
NATIONS FUNDS
Nations Municipal Income Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
NEW YORK -- (CONTINUED)
$ 2,000 New York State Energy
Reshape and Development
Authority, Facilities
Revenue Refunding,
(Consolidated Edison
Company-New York), Series
A, 6.100% 08/15/20......... A1 A+ $ 2,194
New York State Local
Government Assistance
Corporation:
3,000 Series A, 6.000% 04/01/16... A3 A+ 3,318
3,000 Series D, 6.750% 04/01/21... AAA AAA 3,355
2,000 New York, New York, City
Municipal Water Finance
Authority, Water and Sewer
Systems Revenue, Series B,
5.750% 06/15/29............ A2 A 2,171
--------
19,582
--------
NORTH CAROLINA -- 3.3%
1,950 North Carolina Housing
Finance Agency, Refunding,
Multifamily Revenue, Series
B, (FHA COLL), 6.900%
07/01/24................... Aa2 NR 2,095
North Carolina Medical Care
Community, Health Care
Facilities Revenue:
2,605 (Novant Health Project),
Refunding, Series A, 5.000%
10/01/08................... Aaa AAA 2,780
2,500 (Carolina Medicorp Project),
5.250% 05/01/26............ Aa3 AA 2,527
9,675 North Carolina State,
Highway - Series A, 4.500%
05/01/07................... Aaa AAA 10,088
2,000 University of North
Carolina, Chapel Hill,
Hospital Revenue, 5.000%
02/15/29................... Aa3 AA 2,003
2,400 Wake County, North Carolina,
GO, 4.500% 03/01/08........ Aaa AAA 2,488
--------
21,981
--------
OHIO -- 1.0%
1,000 Dayton, Ohio, Special
Facilities Revenue, (Air
Freight Corporation
Project), Series F, 6.050%
10/01/09................... NR BBB 1,099
1,000 Lucas County, Ohio, Hospital
Revenue, (Flower Hospital
Project), Pre-refunded,
6.125% 12/01/13............ NR NR 1,125
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
OHIO -- (CONTINUED)
$ 4,000 Ohio State Highway Capital
Improvements, GO, Series B,
5.000% 05/01/07............ Aa1 AAA $ 4,303
--------
6,527
--------
OKLAHOMA -- 0.5%
3,270 Oklahoma State, Industrial
Authority Revenue,
Deaconess Health Care,
Series A,
5.750% 10/01/17............ Baa2 BBB 3,417
--------
OREGON -- 0.8%
2,000 Chemeketa, Oregon, Community
College District, GO, (FGIC
Insured),
5.800% 06/01/12............ Aaa AAA 2,244
2,900 Portland, Oregon, Sewer
System Revenue,
6.250% 06/01/15............ A1 A+ 3,272
--------
5,516
--------
PENNSYLVANIA -- 3.0%
3,000 Beaver County, Pennsylvania,
Industrial Development
Authority, PCR, Refunding,
(Pennsylvania Power
Company), (Beaver Valley
Project), (AMBAC Insured),
6.000% 09/01/28............ Aaa AAA 3,313
3,480 Butler, Pennsylvania, Area
School District, (FGIC
Insured),
5.830% 11/15/21++.......... Aaa AAA 1,063
2,000 Lehigh County, Pennsylvania,
Industrial Development
Authority, PCR, Refunding,
(Pennsylvania Power and
Light Company Project),
Series A, (MBIA Insured),
6.400% 11/01/21............ Aaa AAA 2,212
1,000 Monroeville, Pennsylvania,
Hospital Authority,
Hospital Revenue Refunding,
(Forbes Health Systems),
5.750% 10/01/05............ A3 A- 950
1,000 Philadelphia, Pennsylvania,
Gas Works Revenue
Refunding, 14th Series,
6.250% 07/01/08............ Baa1 BBB 1,093
Philadelphia, Pennsylvania,
Hospital and Higher
Education Facilities
Authority, Hospital
Revenue, (Frankford
Hospital Project), Series
A:
1,725 6.000% 06/01/14............. A3 A- 1,829
3,125 6.000% 06/01/23............. A3 A- 3,284
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
24
<PAGE> 29
NATIONS FUNDS
Nations Municipal Income Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
PENNSYLVANIA -- (CONTINUED)
Philadelphia, Pennsylvania,
Industrial Development
Authority, Industrial
Development Revenue
Refunding, (Ashland Oil
Inc. Project):
$ 4,800 5.700% 06/01/05............. Baa2 NR $ 5,154
1,250 7.000% 01/01/11............. NR NR 1,382
--------
20,280
--------
RHODE ISLAND -- 0.5%
2,845 Rhode Island State,
Construction Capital
Development Lane, GO,
Series A, (MBIA Insured),
5.600% 08/01/10............ Aaa AAA 3,119
--------
SOUTH CAROLINA -- 2.9%
7,000 Florence County, South
Carolina, Hospital Revenue,
McLeod Regional Medical
Center Project, Series A,
(MBIA Insured), 5.000%
11/01/18................... Aaa AAA 7,025
1,500 Greenville, South Carolina,
Waterworks Revenue,
5.500% 02/01/22............ Aa1 AA 1,581
2,000 South Carolina, State
Housing Finance and
Development Authority,
Homeownership Mortgage
Purchase, Series A,
6.375% 07/01/16............ Aa2 AA 2,149
2,000 Spartanburg County, South
Carolina, Solid Waste
Disposal Facilities
Revenue, (BMW Project),
7.550% 11/01/24............ NR NR 2,317
6,035 York County, South Carolina,
Industrial Development
Revenue, Exempt Facility,
(Hoechst Celanese
Corporation Project), AMT,
5.700% 01/01/24............ A2 A+ 6,232
--------
19,304
--------
TENNESSEE -- 2.2%
2,500 Maury County, Tennessee,
Industrial Development
Board, PCR, Multi-Modal,
Refunding, (Saturn
Corporation Project),
General Motors Guaranty
Agreement,
6.500% 09/01/24............ A3 A 2,750
2,750 McMinn County, Tennessee,
Industrial Development
Board, Solid Waste
Recycling Facility Revenue,
(Calhoun Newsprint
Project), AMT, 7.400%
12/01/22................... Baa1 BBB 3,072
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
TENNESSEE -- (CONTINUED)
$ 2,735 Memphis-Shelby County,
Tennessee, Airport Revenue
Refunded, (Federal Express
Corporation),
6.750% 09/01/12............ Baa2 BBB $ 2,996
1,000 Memphis, Tennessee,
Refunded, GO, 5.200%
11/01/10................... Aa AA 1,062
Metropolitan Government
Nashville & Davidson
County, Tennessee, Water &
Sewer Revenue, Refunding:
2,500 (FGIC Insured),
5.200% 01/01/13............ Aaa AAA 2,685
2,000 (MBIA Insured),
5.500% 01/01/14............ Aaa AAA 2,160
--------
14,725
--------
TEXAS -- 10.5%
4,000 Alliance Airport Authority
Inc., Texas, Special
Facilities Revenue,
(American Airlines Inc.
Project), AMT,
7.000% 12/01/11............ Baa2 BBB- 4,799
2,000 Arlington Texas,
Independent School
District-D, GO, (PSFG
Insured),
6.500% 08/15/03............ Aaa Aa2 2,237
2,470 Beaumont Texas, Independent
School District, (PSFG
Insured), GO,
5.000% 02/15/17............ Aaa AAA 2,505
3,610 Bexar, Texas, Metropolitan
Water District Water Works,
(MBIA Insured),
6.000% 05/01/15............ Aaa AAA 4,015
1,000 Brazos River Authority,
Texas, Revenue Refunding,
(Houston Light and Power
Company Project), Series B,
(MBIA Insured), 6.375%
04/01/12................... Aaa AAA 1,104
2,575 Carrollton-Farmers Branch
Independent School
District, Texas, (PSF-GTD),
GO,
5.700% 02/15/17............ Aaa AAA 2,734
Cypress-Fairbanks
Independent School
District, Texas, GO:
1,275 (PSF-GTD),
5.750% 02/15/16............ Aaa AAA 1,405
4,805 Unrefunded Balance, Series
A,
5.500% 02/15/11............ Aaa AAA 5,031
1,750 Dallas County, Texas, GO,
5.250% 08/15/16............ Aaa AAA 1,833
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
25
<PAGE> 30
NATIONS FUNDS
Nations Municipal Income Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
TEXAS -- (CONTINUED)
$ 1,000 Dallas Independent School
District, Texas, GO,
(PSF-GTD),
5.700% 08/15/12............ Aaa AAA $ 1,079
1,075 Denton, Texas, Utilities
Systems, Revenue Refunding,
Series A, (MBIA Insured),
5.700% 12/01/10............ Aaa AAA 1,182
2,000 Guadalupe-Blanco River
Authority, Texas, Revenue
Refunding, (Sohio Chemical
Company),
6.550% 05/01/13............ Aa2 AA- 2,187
4,000 Harris County, Texas, Health
Facilities Development
Authority, Hospital Revenue
Refunding, (Memorial
Hospital Systems Project),
Series A, (MBIA Insured),
4.875% 06/01/05............ Aaa AAA 4,181
4,000 Lower Neches Valley
Authority, Texas,
Industrial Development
Corporation, Revenue
Refunding, (Mobil Oil
Refining Project),
5.800% 05/01/22............ Aa2 AA 4,349
1,500 Lubbock, Texas, Health
Facilities Development
Corporation, Revenue
Refunding, (St. Joseph
Health System Project),
5.500% 07/01/14............ Aa3 AA 1,563
North Central Texas, Health
Facilities Development
Corporation, Hospital
Revenue, (Presbyterian
Healthcare), Series A:
2,000 6.625% 06/01/11............. Aa3 NR 2,347
12,500 5.000% 05/15/17............. Aa3 NR 12,543
1,500 Plano, Texas, GO, (FGIC
Insured),
6.750% 09/01/11............ AAA AAA 1,627
2,000 Texas City, Texas,
Industrial Development
Corporation, Marine
Terminal Revenue,
Refunding, (Arco Pipe Line
Company Project),
7.375% 10/01/20............ A2 A 2,675
5,000 Texas State Department of
Housing and Community
Affairs, Single Family
Mortgage Revenue, AMT,
Series A, Class 1, (MBIA
Insured),
5.800% 09/01/29............ Aaa AAA 5,218
2,000 Texas State, Refunding, GO,
Series A,
6.000% 10/01/08............ Aa2 AA 2,306
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
TEXAS -- (CONTINUED)
$ 3,000 University of Texas,
Permanent University Fund,
Refunding, Series A,
6.250% 07/01/13............ Aaa AAA $ 3,230
--------
70,150
--------
UTAH -- 2.2%
2,000 Emery County, Utah, PCR
Refunding, (Pacificorp
Projects), Series A, (AMBAC
Insured),
5.650% 11/01/23............ Aaa AAA 2,123
8,300 Murray City, Utah, Hospital
Revenue Refunding, (IHC
Health Services Inc.),
(MBIA Insured),
5.000% 05/15/22............ Aaa AAA 8,220
2,000 Provo, Utah, Electric
Revenue,
10.125% 04/01/15........... AAA AAA 2,832
1,300 Salt Lake City, Utah, Water
and Sewer Revenue, (AMBAC
Insured),
6.100% 02/01/14............ Aaa AAA 1,438
--------
14,613
--------
VIRGINIA -- 3.7%
2,900 Bedford County, Virginia,
Industrial Development
Authority,
4.600% 08/01/04............ Baa2 NR 2,952
2,000 Covington-Allegheny County,
Virginia, Industrial
Development Authority, PCR,
(Westvaco Corporation
Project),
6.650% 09/01/18............ A1 A 2,236
3,220 Fairfax County, Virginia,
Public Improvement, GO,
Series A,
5.100% 06/01/03............ Aaa AAA 3,407
Fairfax County, Virginia,
Water Authority Revenue,
Refunding:
1,670 Prerefunded,
6.000% 04/01/22............ AAA AAA 1,930
2,830 Unrefunded Balance,
6.000% 04/01/22............ Aa2 AA 3,162
1,500 Henrico County, Virginia,
Public School Authority
Special Obligation,
5.250% 07/15/09............ Aaa AAA 1,598
1,000 Norfolk, Virginia, Capital
Improvements, GO, (FGIC
Insured),
5.375% 06/01/15............ Aaa AAA 1,064
1,750 University of Virginia,
University Revenues --
Series A,
5.200% 06/01/12............ Aa1 AA+ 1,828
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
26
<PAGE> 31
NATIONS FUNDS
Nations Municipal Income Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
VIRGINIA -- (CONTINUED)
$ 3,000 Virginia Commonwealth
Transportation Board,
Transportation Program
Revenue, (Oak Grove
Connector), Series A,
5.250% 05/15/22............ Aa2 AA $ 3,078
3,000 Virginia State, Refunding,
GO,
5.000% 06/01/10............ Aaa AAA 3,156
--------
24,411
--------
WASHINGTON -- 8.6%
5,000 Chelan County, Washington,
Development Corporation
Revenue, Refunding,
Pollution control, (Alcoa
Project),
5.850% 12/01/31............ A1 A+ 5,415
2,310 Chelan County, Washington,
Public Utility,
5.600% 07/01/32............ Aa3 AA 2,436
2,480 Clark County, Washington,
Sewer Revenue, (MBIA
Insured),
5.800% 12/01/11............ Aaa AAA 2,730
1,035 King County, Washington,
Library Systems, GO,
6.150% 12/01/10............ Aa AA- 1,163
2,000 King County, Washington,
School District No. 415-
Kent, GO, (FSA Insured),
5.800% 06/01/13............ Aaa AAA 2,186
3,000 King County, Washington,
Sewer Revenue, Refunding,
Series C,
5.250% 01/01/17............ Aa1 AA+ 3,082
7,150 Pierce County, Washington,
Economic Development
Corporation, Solid Waste
Revenue, (Occidental
Petroleum),
5.800% 09/01/29............ Baa2 BBB 7,296
2,500 Public Industrial
Corporation, Port Camas -
Washougal, Washington, PCR,
(James River Corporation
Project),
6.700% 04/01/23............ NR BBB- 2,685
2,000 Seattle, Washington, GO,
Series A,
5.625% 01/15/10............ Aa1 AA+ 2,175
2,000 Seattle, Washington,
Municipal Light and Power
Revenue,
6.625% 07/01/16............ Aa2 AA 2,310
1,400 Seattle, Washington, Water
Systems Revenue, Refunding,
5.500% 06/01/18............ Aa2 AA 1,455
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
WASHINGTON -- (CONTINUED)
$ 2,000 Snohomish County,
Washington, Public Utility
District No. 1, Electric
Revenue Refunding, Series
A,
6.800% 01/01/05............ A1 A+ $ 2,154
Washington State, GO:
3,500 Refunding, Series 92A,
6.500% 09/01/04............ Aa1 AA+ 3,782
3,000 Series 93A,
5.750% 10/01/12............ Aa1 AA+ 3,410
5,000 Series A,
6.750% 02/01/15............ Aa1 AA+ 6,211
Washington State, Public
Power Supply System,
Revenue Refunding:
5,000 Series A, (Systems Nuclear
Project No. 1), (MBIA
Insured),
5.750% 07/01/11............ Aaa AAA 5,486
3,000 Series B, (Systems Nuclear
Project No. 3), (FSA
Insured),
5.400% 07/01/05............ Aaa AAA 3,231
--------
57,207
--------
WISCONSIN -- 0.2%
1,000 Wisconsin State, Refunding,
GO, Series 1,
5.800% 11/01/08............ Aa2 AA 1,138
--------
WEST VIRGINIA -- 0.7%
Jefferson County, West
Virginia, Board of
Education, (FGIC Insured):
1,450 6.850% 07/01/07............. Aaa AAA 1,746
1,560 6.850% 07/01/08............. Aaa AAA 1,899
1,000 West Virginia, University
Revenue, State University
System, (Marshall
University Library), (AMBAC
Insured), 5.750%
04/01/16................... Aaa AAA 1,087
--------
4,732
--------
WYOMING -- 0.4%
2,300 Campbell County, Wyoming,
School District No. 001
Gillette, GO, (SCH BD GTY),
5.550% 06/01/06............ Aaa AAA 2,513
--------
TOTAL MUNICIPAL
BONDS AND NOTES
(Cost $599,972)..................... 658,582
--------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
27
<PAGE> 32
NATIONS FUNDS
Nations Municipal Income Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
SHARES (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
INVESTMENT COMPANY -- 0.1% (Cost $784)
784,000 AIM Tax-Exempt Fund......................... $ 784
--------
TOTAL INVESTMENTS
(Cost $600,756*)............ 98.8% 659,366
----
OTHER ASSETS AND
LIABILITIES (NET).......... 1.2
Cash................................. $ 1
Receivable for fund shares sold...... 979
Dividends and interest receivable.... 10,175
Payable for fund shares redeemed..... (258)
Investment advisory fee payable...... (237)
Administration fees payable.......... (44)
Shareholder servicing and
distribution fees payable........... (91)
Dividend payable..................... (2,532)
Accrued trustees' fees and
expenses............................ (16)
Accrued expenses and other
liabilities......................... (108)
----
TOTAL OTHER ASSETS AND
LIABILITIES (NET)................... 7,869
----
NET ASSETS.................. 100.0% $667,235
====
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
PRIMARY A SHARES:
($625,817,000/53,610,961 shares
outstanding)........................ $11.67
====
INVESTOR A SHARES:
($24,183,000/2,071,605 shares
outstanding)........................ $11.67
====
INVESTOR B SHARES:
($15,108,000/1,294,182 shares
outstanding)........................ $11.67
====
INVESTOR C SHARES:
($2,127,000/182,241 shares
outstanding)........................ $11.67
====
</TABLE>
<TABLE>
<CAPTION>
VALUE
(000)
- ------------------------------------------------------------------
<C> <S> <C> <C>
NET ASSETS CONSIST OF:
Undistributed net investment income....... $ 513
Accumulated net realized gain
on investments sold...................... 1,216
Net unrealized appreciation of
investments.............................. 58,610
Paid-in capital........................... 606,896
--------
NET ASSETS................................ $667,235
========
</TABLE>
- ---------------
* Federal Income Tax Information: Net unrealized appreciation of investment
securities was comprised of gross appreciation of $58,610,000 for federal
income tax purposes. At September 30, 1998, the aggregate cost of securities
for federal income tax purposes was $600,756,000.
++ Zero coupon security. The rate shown reflects the yield to maturity.
Nations Municipal Income Fund had the following insurance concentration greater
than 10% at September 30, 1998 (as a percentage of net assets):
MBIA 18.78%
SEE NOTES TO FINANCIAL STATEMENTS.
28
<PAGE> 33
NATIONS FUNDS
Nations Florida Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ---------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 96.8%
FLORIDA -- 93.9%
$ 2,000 Alachua County, Florida,
Health Facilities Authority
Revenue, (Shands Hospital,
University of Florida),
(MBIA Insured),
6.100% 12/01/05............. Aaa AAA $ 2,166
3,375 Bay County, Florida, PCR,
Refunding, (International
Paper Company Project),
Series A,
5.100% 09/01/12............. A3 BBB+ 3,489
Bay Medical Center, Florida,
Hospital Revenue Refunding,
(Bay Medical Center
Project), (AMBAC Insured):
1,000 5.000% 10/01/05.............. Aaa AAA 1,066
2,000 5.450% 10/01/12.............. Aaa AAA 2,174
2,000 Boca Raton, Florida, Water
and Sewer Revenue Refunding,
5.600% 10/01/04............. Aa2 AA- 2,149
1,000 Brevard County, Florida,
Health Facilities, Authority
Revenue Refunding (Wuesthoff
Memorial Hospital), (MBIA
Insured),
6.250% 04/01/06............. Aaa AAA 1,146
1,000 Broward County, Florida, Gas
Tax Revenue,
6.400% 09/01/03............. A1 AA- 1,085
Broward County, Florida, GO,
Series C:
2,000 5.600% 01/01/01.............. Aa2 AA 2,085
3,000 6.200% 01/01/07.............. Aa2 AA 3,261
2,000 Broward County, Florida,
School District Revenue
Refunding, GO,
6.000% 02/15/07............. A1 AA- 2,166
2,000 Broward County, Florida,
Solid Waste Revenue, (MBIA
Insured),
5.500% 07/01/04............. Aaa AAA 2,168
1,000 Citrus County, Florida, PCR
Refunding, Crystal River,
(Florida Power Corporation),
Series B,
6.350% 02/01/22............. Aa3 A+ 1,095
3,000 Clearwater, Florida, Water
and Sewer Authority Revenue,
(AMBAC Insured),
5.000% 12/01/02............. Aaa AAA 3,150
1,000 Collier County, Florida,
Water and Sewer District
Revenue, (FGIC Insured),
6.375% 07/01/10............. Aaa AAA 1,099
1,000 Dade County, Florida,
Aviation Facility Revenue,
Series B, AMT, (AMBAC
Insured),
6.300% 10/01/05............. Aaa AAA 1,143
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ---------------------------------------------------------------------
<C> <S> <C> <C> <C>
FLORIDA -- (CONTINUED)
$ 1,650 Dade County, Florida, School
District Revenue Refunding,
(AMBAC Insured),
5.000% 07/15/01............. Aaa AAA $ 1,709
3,000 Dade County, Florida, Water
and Sewer Systems Revenue,
(FGIC Insured),
5.000% 10/01/00............. Aaa AAA 3,083
Delray Beach, Florida, Water
and Sewer Authority Revenue
Refunding, Series A, (AMBAC
Insured):
2,000 5.000% 10/01/02.............. Aaa AAA 2,097
1,000 5.000% 10/01/03.............. Aaa AAA 1,057
Dunes, Florida, Community
Development District
Revenue, (Intercoastal Water
Way Bridge):
1,565 5.300% 10/01/03.............. NR BBB 1,650
1,900 5.400% 10/01/04.............. NR BBB 2,026
1,900 Duval County, Florida,
Housing Finance Authority,
Multi-family Mortgage
Revenue Refunding, (The Cove
Project),
6.100% 10/01/02............. NR AAA 2,012
3,600 Escambia County, Florida,
PCR, (Champion International
Corporation Project), AMT,
6.400% 09/01/30............. Baa1 NR 3,913
1,700 Escambia County, Florida,
Utilities Authority Systems
Revenue, (FGIC Insured),
5.625% 01/01/21............. Aaa AAA 1,816
1,000 Florida Ports Financing
Community Revenue, State
Transportation Trust Fund,
(MBIA Insured),
5.375% 06/01/16............. Aaa AAA 1,055
Florida State Board of
Education, GO, Capital
Outlay, Public Education:
Refunding,
1,450 5.500% 06/01/01.............. Aa2 AA+ 1,519
1,000 Refunding, Series A,
5.000% 06/01/08............. Aa2 AA 1,072
1,500 Unrefunded Balance,
7.250% 06/01/23............. Aa2 AA+ 1,608
1,000 Unrefunded Balance, Series C,
6.500% 06/01/11............. AAA AA+ 1,104
4,000 Unrefunded Balance, Series D,
5.200% 06/01/11............. Aa2 AA+ 4,170
3,030 Florida State Board of
Regents, University System
Improvement Revenue, Series
A,
5.000% 07/01/16............. Aa3 AA- 3,103
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
29
<PAGE> 34
NATIONS FUNDS
Nations Florida Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ---------------------------------------------------------------------
<C> <S> <C> <C> <C>
FLORIDA -- (CONTINUED)
$ 1,500 Florida State Department of
Transportation, (Right-of-
Way Bridge), GO,
5.375% 07/01/26............. Aa2 AA+ $ 1,569
1,000 Florida State Division Bond,
Financial Department of
General Services Revenue,
Pool Facilities Management,
(AMBAC Insured),
4.800% 09/01/01............. Aaa AAA 1,033
Florida State Division Bond,
Financial Department of
General Service Revenue,
Preservation Authority:
(AMBAC Insured),
3,000 6.250% 07/01/01.............. Aaa AAA 3,205
(MBIA Insured):
2,000 5.800% 07/01/01.............. Aaa AAA 2,114
1,000 6.250% 07/01/06.............. Aaa AAA 1,097
Florida State Housing Finance
Agency, Refunding:
4,000 Multi-family Housing,
(Altamonte Project), Series
C,
7.000% 12/01/24............. NR BBB+ 4,454
1,000 Multi-family Housing Revenue,
(Andover Project), Series E,
6.350% 05/01/26............. NR BBB+ 1,086
(The Vinyards Project),
Series H:
1,290 5.875% 11/01/05.............. NR BBB+ 1,364
1,000 6.400% 11/01/15.............. NR BBB+ 1,070
2,470 Florida State Housing
Financing Corporation
Revenue, Home Owner
Mortgage - Series 1, (MBIA
Insured),
4.950% 07/01/11............. Aaa AAA 2,501
1,805 Florida State Jacksonville
Transportation Authority,
GO, Refunding,
6.000% 07/01/05............. Aa2 AA+ 2,030
2,500 Florida State Turnpike
Authority Revenue, Series A,
(AMBAC Insured),
7.000% 07/01/04............. Aaa AAA 2,765
1,000 Fort Lauderdale, Florida,
Water and Sewer Authority
Revenue,
5.500% 09/01/01............. NR AAA 1,052
1,000 Gainesville, Florida,
Utilities Systems Revenue,
Series A,
5.750% 10/01/07............. Aa AA 1,135
1,375 Hialeah, Florida, Capital
Improvement Revenue,
5.500% 10/01/18............. Baa1 NR 1,398
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ---------------------------------------------------------------------
<C> <S> <C> <C> <C>
FLORIDA -- (CONTINUED)
Hillsborough County, Florida,
Aviation Authority Revenue
Refunding, (Tampa
International Airport
Project), Series A, (AMBAC
Insured):
$ 1,000 5.900% 10/01/06.............. Aaa AAA $ 1,062
3,170 5.750% 10/01/07.............. Aaa AAA 3,528
1,000 Hillsborough County, Florida,
Capital Improvement Program,
Revenue Refunding, (County
Center Project), Series B,
(MBIA Insured),
5.000% 07/01/11............. Aaa AAA 1,048
2,640 Hillsborough County, Florida,
Environmentally Sensitive
Lands, (AMBAC Insured),
6.250% 07/01/06............. Aaa AAA 2,920
2,000 Hillsborough County, Florida,
Utility Revenue Refunding,
Capital Appreciation, Series
A, (MBIA-IBC Insured),
7.050% 08/01/99+............ Aaa AAA 1,946
1,000 Hollywood, Florida, Water and
Sewer Revenue, (FGIC
Insured),
6.200% 10/01/01............. Aaa AAA 1,073
Indian River County, Florida,
School District, (FSA
Insured):
1,500 5.000% 04/01/03.............. Aaa AAA 1,578
1,800 5.000% 04/01/04.............. Aaa AAA 1,905
1,750 5.100% 04/01/05.............. Aaa AAA 1,867
1,000 Indian River County, Florida,
Water and Sewer Revenue
Refunding, Series A, (FGIC
Insured),
5.200% 09/01/05............. Aaa AAA 1,078
Jacksonville, Florida,
Electric Authority Revenue
Refunding:
4th Series, St. John's River
Authority:
1,000 Series 6B,
6.650% 10/01/02............. Aa2 AA 1,070
2,000 Series 6C,
6.400% 10/01/00............. Aa2 AA 2,107
1,000 Electric Systems, Series 3A,
5.200% 10/01/02............. Aa2 AA 1,052
1,000 Jacksonville, Florida, Excise
Tax Revenue Refunding,
Series A,
(FGIC Insured),
5.000% 10/01/09............. Aaa AAA 1,074
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
30
<PAGE> 35
NATIONS FUNDS
Nations Florida Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ---------------------------------------------------------------------
<C> <S> <C> <C> <C>
FLORIDA -- (CONTINUED)
Jacksonville, Florida, Health
Facilities Authority,
Hospital Revenue:
$ 1,000 (Daughters of Charity),
Series A,
5.000% 11/15/15............. Aa2 AA $ 1,009
1,375 (St. Lukes Hospital
Association Project),
6.750% 11/15/02............. NR AA+ 1,518
4,200 Series B,
5.400% 08/15/18............. Aa2 AA+ 4,382
1,000 Jacksonville Beach, Florida,
Utilities Revenue, (MBIA
Insured),
6.500% 10/01/12............. Aaa AAA 1,100
2,000 Lakeland, Florida, Water and
Electricity Revenue
Refunding,
5.625% 10/01/04............. Aa AA- 2,192
1,000 Leon County, Florida, School
District Revenue Refunding,
GO,
6.200% 07/01/04............. A1 A+ 1,059
2,000 Miami, Florida, GO,
(FGIC Insured),
5.600% 12/01/03............. Aaa AAA 2,167
1,500 Miami Beach, Florida, GO,
(FGIC Insured),
5.300% 09/01/03............. Aaa AAA 1,600
1,000 Naples, Florida, Water and
Sewer Revenue Refunding,
(FGIC Insured),
6.400% 09/01/07............. Aaa AAA 1,107
3,000 North Broward, Florida,
Hospital Revenue, (MBIA
Insured),
6.250% 01/01/06............. AAA AAA 3,284
Orange County, Florida,
Health Facilities Authority
Revenue Refunding:
1,375 (Lakeside Alternatives Inc.),
6.250% 07/01/05............. NR BBB 1,510
(Orlando Regional Medical
Center Hospital), (MBIA
Insured):
3,000 4.400% 10/01/02.............. Aaa AAA 3,072
2,000 5.400% 11/01/02.............. Aaa AAA 2,124
2,000 6.250% 10/01/16.............. Aaa AAA 2,374
1,940 Orange County, Florida,
Housing Finance Authority,
Single-family Mortgage
Revenue, Series A,
(GNMA/FNMA Collateral),
5.900% 09/01/19............. NR AAA 2,069
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ---------------------------------------------------------------------
<C> <S> <C> <C> <C>
FLORIDA -- (CONTINUED)
Orlando, Florida, Greater
Orlando Aviation Authority,
Airport Facilities Revenue
Refunding:
Series B, (FGIC Insured):
$ 2,000 6.200% 10/01/03.............. Aaa AAA $ 2,215
2,425 5.250% 10/01/11.............. Aaa AAA 2,605
Series D, (AMBAC Insured):
3,200 5.450% 10/01/01.............. Aaa AAA 3,361
2,000 5.600% 10/01/02.............. Aaa AAA 2,136
Orlando, Florida, Utilities
Commission, Water and
Electricity Revenue
Refunding:
3,000 5.600% 10/01/03.............. Aa1 AA 3,250
2,000 Series B,
5.400% 10/01/08............. Aa2 AA- 2,149
Orlando and Orange County,
Florida, Expressway
Authority Revenue Refunding:
2,000 Junior Lien, (FGIC Insured),
6.500% 07/01/10............. Aaa AAA 2,415
3,000 Senior Lien, (AMBAC Insured),
5.000% 07/01/03............. Aaa AAA 3,163
Palm Beach County, Florida,
GO:
1,750 6.875% 12/01/03.............. Aa2 AA 2,002
1,300 7.000% 12/01/04.............. Aa2 AA 1,524
1,250 6.600% 10/01/11.............. NR NR 1,375
2,000 Refunding,
5.500% 12/01/11.............. Aa2 AA 2,233
1,000 Palm Beach County, Florida,
Health Facilities Authority
Revenue,
(Good Samaritan Health
Systems),
6.100% 10/01/05............. NR A+ 1,105
2,000 Palm Beach County, Florida,
School District Revenue
Refunding, GO, (AMBAC
Insured),
6.000% 08/01/06............. Aaa AAA 2,165
2,000 Palm Beach County, Florida,
Stadium Facilities Revenue,
(MBIA Insured),
5.250% 12/01/16............. Aaa AAA 2,116
1,250 Pembroke Pines, Florida,
Utility Systems Revenue,
(FGIC Insured),
6.250% 09/01/07............. Aaa AAA 1,355
1,400 Pinellas County, Florida,
Health Facilities Authority
Revenue, (Morton Plant
Health Systems Project),
(MBIA Insured),
4.900% 11/15/02............. Aaa AAA 1,461
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
31
<PAGE> 36
NATIONS FUNDS
Nations Florida Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ---------------------------------------------------------------------
<C> <S> <C> <C> <C>
FLORIDA -- (CONTINUED)
$ 1,000 Pinellas County, Florida,
PCR, (Anclote & Barton Power
Plants Florida Power
Corporation),
7.200% 12/01/14............. Aa3 A+ $ 1,102
Pinellas County, Florida,
Resource Recovery Revenue
Refunding, Series A, (MBIA
Insured):
2,000 6.600% 10/01/00.............. Aaa AAA 2,117
2,500 6.800% 10/01/02.............. Aaa AAA 2,692
2,700 Reedy Creek, Florida,
Improvement District
Revenue, Series A,
6.400% 06/01/07............. A1 A+ 2,895
St. John's County, Florida,
Industrial Development
Authority, Hospital Revenue,
(Flagler Hospital Project):
850 5.700% 08/01/02.............. A2 A- 900
945 6.000% 08/01/08.............. A2 A- 1,010
St. Lucie County, Florida,
School District Revenue, GO:
2,000 (AMBAC Insured),
6.000% 07/01/03............. Aaa AAA 2,192
1,000 (FGIC Insured),
5.875% 02/01/07............. Aaa AAA 1,132
2,000 St. Petersburg, Florida,
Utility Tax Refunding
Revenue, (AMBAC Insured),
6.000% 06/01/05............. Aaa AAA 2,176
1,000 Sarasota, Florida, Water and
Sewer Utility Revenue
Refunding, (FGIC Insured),
6.000% 10/01/02............. Aaa AAA 1,085
1,200 Sarasota County, Florida, GO,
(FGIC Insured),
6.100% 10/01/02............. Aaa AAA 1,303
Sarasota County, Florida,
Public Hospital Board
Revenue, Refunding,
(Sarasota Memorial Hospital
Project), Series B, (MBIA
Insured):
1,650 5.000% 10/01/07.............. Aaa NR 1,769
1,750 5.250% 07/01/11.............. Aaa AAA 1,892
2,100 Seminole County, Florida,
School District Revenue, GO,
(MBIA Insured),
5.900% 08/01/02............. Aaa AAA 2,264
Tallahassee, Florida, Health
Facilities Revenue
Refunding, Memorial Regional
Medical Center, Inc., (MBIA
Insured):
1,000 Series A,
5.750% 12/01/04............. Aaa AAA 1,091
1,000 Series B,
5.750% 12/01/04............. Aaa AAA 1,091
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ---------------------------------------------------------------------
<C> <S> <C> <C> <C>
FLORIDA -- (CONTINUED)
$ 2,000 Tampa, Florida, Health
System -- Catholic
Health -- A-1,
4.875% 11/15/15............. Aaa AAA $ 1,999
3,170 Tampa, Florida, Sports
Authority Revenue, (Stadium
Project), (MBIA Insured),
6.000% 01/01/07............. Aaa AAA 3,616
Tampa, Florida, Water and
Sewer Revenue, (FGIC
Insured):
1,000 5.125% 10/01/17.............. Aaa AAA 1,032
1,000 Series A,
5.000% 10/01/02............. Aaa AAA 1,048
2,750 Tampa Hillsborough County,
Florida, Expressway
Authority Revenue, (AMBAC
Insured),
5.000% 07/01/27............. Aaa AAA 2,764
1,025 Venice, Florida, Health
Facilities Revenue, (Venice
Hospital, Inc. Project),
5.300% 12/01/02............. AAA NR 1,086
1,000 Venice, Florida Stormwater &
Drain Revenue, (AMBAC
Insured),
5.600% 05/01/16............. Aaa AAA 1,077
--------
220,147
--------
GEORGIA -- 1.3%
3,000 Fulton County, Georgia, Water
& Sewage Revenue,
4.750% 01/01/19............. A1 AA- 2,946
--------
ILLINOIS -- 0.4%
1,000 Illinois State, EDL
Facilities Authority
Revenues, University of
Chicago - Series B, 4.400%
07/01/25.................... Aa1 AA 1,015
--------
PUERTO RICO -- 1.2%
1,650 Puerto Rico Industrial,
Medical and Environmental
Agency, Pollution Control
Facilities, Finance
Authority Revenue, Higher
Education, (Catholic
University Project),
Series A,
5.600% 12/01/07............. NR BBB- 1,789
1,000 Puerto Rico Industrial,
Tourist, Educational,
Medical and Environmental
Control Facilities Financing
Authority, (Ryder Memorial
Hospital Project), Series A,
6.600% 05/01/14............. NR BBB 1,091
--------
2,880
--------
TOTAL MUNICIPAL BONDS AND
NOTES
(Cost $212,441)....................... 226,988
--------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
32
<PAGE> 37
NATIONS FUNDS
Nations Florida Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
SHARES (000)
- -------------------------------------------------------------------
<C> <S> <C> <C>
INVESTMENT COMPANY -- 1.9% (Cost $4,407)
4,407,000 AIM Tax-Exempt Fund........................ $ 4,407
TOTAL INVESTMENTS 98.7%
(Cost $216,848*)................... 231,395
--------
OTHER ASSETS AND 1.3
LIABILITIES (NET)..................
Cash....................................... $ 1
Receivable for fund shares sold............ 159
Dividends and interest receivable.......... 4,034
Payable for fund shares redeemed........... (904)
Investment advisory fee payable............ (62)
Administration fees payable................ (15)
Shareholder servicing and distribution fees
payable................................... (32)
Accrued trustees' fees and expenses........ (7)
Accrued expenses and other liabilities..... (92)
--------
TOTAL OTHER ASSETS AND
LIABILITIES (NET)......................... 3,082
--------
NET ASSETS.......................... 100.0% $234,477
========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
PRIMARY A SHARES:
($212,368,000/19,460,501 shares
outstanding).............................. $10.91
========
INVESTOR A SHARES:
($15,518,000/1,421,993 shares
outstanding).............................. $10.91
========
INVESTOR B SHARES:
($4,418,000/404,890 shares outstanding).... $10.91
========
INVESTOR C SHARES:
($2,173,000/199,097 shares outstanding).... $10.91
========
<CAPTION>
VALUE
(000)
- -------------------------------------------------------------------
<C> <S> <C> <C>
NET ASSETS CONSIST OF:
Undistributed net investment income........ $ --
Accumulated net realized loss on
investments sold.......................... (713)
Net unrealized appreciation of
investments............................... 14,547
Paid-in capital............................ 220,643
--------
NET ASSETS................................. $234,477
========
</TABLE>
- ---------------
* Federal Income Tax Information: Net unrealized appreciation of investment
securities was comprised of gross appreciation of $14,547,000 for federal
income tax purposes. At September 30, 1998, the aggregate cost of securities
for federal income tax purposes was $216,848,000.
+ Zero coupon security. The rate shown reflects the yield to maturity.
Nations Florida Intermediate Municipal Bond Fund had the following insurance
concentrations greater than 10% at September 30, 1998 (as a percentage of net
assets):
MBIA 20.17%
AMBAC 19.59%
FGIC 12.06%
SEE NOTES TO FINANCIAL STATEMENTS.
33
<PAGE> 38
NATIONS FUNDS
Nations Florida Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATINGS VALUE
(000) MOODY'S S&P (000)
- --------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 96.4%
FLORIDA -- 82.4%
Alachua County, Florida,
Health Facilities
Authority, Revenue
Refunding:
$ 1,000 (Santa Fe Healthcare
Facilities Project), ETM,
6.000% 11/15/09............ Baa1 AAA $ 1,096
1,000 (Shands Teaching Hospitals
and Clinics Inc. Project),
Series A, (MBIA Insured),
5.000% 12/01/04............ Aaa AAA 1,062
1,000 Alachua County, Florida,
Public Improvement Revenue
Refunding, (FSA Insured),
5.000% 08/01/14............ Aaa AAA 1,031
1,000 Bay County, Florida, PCR,
Refunding, (International
Paper Company Project),
Series A,
5.100% 09/01/12............ A3 BBB+ 1,034
2,550 Brevard County, Florida,
Health Facilities Authority
Revenue, (Holmes Regional
Medical Center Project),
(MBIA Insured),
5.625% 10/01/14............ Aaa AAA 2,768
1,000 Canaveral, Florida, Port
Authority Revenue
Refunding, Port
Improvement, Series B,
(FGIC Insured),
5.700% 06/01/13............ NR AAA 1,092
2,250 Charlotte County, Florida,
Utility Revenue, Refunding,
Series A, (FGIC Insured),
5.625% 10/01/16............ Aaa AAA 2,452
1,000 Citrus County, Florida, PCR
Refunding, Crystal River,
(Florida Power
Corporation), Series B,
6.350% 02/01/22............ Aa3 A+ 1,095
Collier County, Florida,
Health Facilities Authority
and Revenue, Refunding,
(Moorings
700 6.250% 12/01/07............. NR BBB+ 780
700 6.375% 12/01/08............. NR BBB+ 782
5,175 7.000% 12/01/19............. NR BBB+ 5,784
2,500 Dade County, Florida,
Aviation Revenue, AMT,
Series A, (MBIA Insured),
5.750% 10/01/12............ Aaa AAA 2,745
1,000 Dade County, Florida, School
District Revenue Refunding,
GO, Series A, (MBIA
Insured),
6.125% 06/01/14............ Aaa AAA 1,132
1,500 Dade County, Florida, Water
and Sewer System Revenue
Refunding, (FGIC Insured),
5.000% 10/01/13............ Aaa AAA 1,541
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATINGS VALUE
(000) MOODY'S S&P (000)
- --------------------------------------------------------------------
<C> <S> <C> <C> <C>
FLORIDA -- (CONTINUED)
Escambia County, Florida,
PCR, (Champion
International Corporation
Project), AMT:
$ 1,000 6.900% 08/01/22............. Baa1 BBB $ 1,106
1,000 6.400% 09/01/30............. Baa1 NR 1,087
Florida State Board of
Education, GO, Capital
Outlay, Public Education:
Series A:
1,000 5.000% 06/01/08............. Aa2 AA+ 1,072
2,500 5.250% 06/01/16............. Aa2 AA+ 2,618
3,000 5.000% 06/01/18............. Aa2 AA+ 3,019
1,000 Refunding, Series D,
5.125% 06/01/18............ Aa2 AA+ 1,014
1,000 Unrefunded Balance, Series
A,
7.250% 06/01/23............ Aa2 AA+ 1,072
1,000 Florida State Department of
Transportation, Fuel Sales
Tax Revenue, (Right-of-Way
Bridge), GO,
5.375% 07/01/26............ Aa2 AA+ 1,046
2,000 Florida State Department of
Transportation, Right of
Way - A,
5.000% 07/01/2017.......... Aa2 AA+ 2,042
Florida State Housing
Finance Agency:
1,000 Refunding, Multi-family
Housing, (Altamonte
Project), Series C,
7.000% 12/01/24............ NR BBB+ 1,114
500 Refunding, (The Vinyards
Project), Series H,
6.500% 11/01/25............ NR BBB+ 536
785 Single-family Mortgage,
Series B, AMT, (GNMA/FNMA
Collateral),
6.550% 07/01/17............ Aaa AAA 841
Florida State Housing
Finance Agency, Homeowner
Mortgage, (MBIA Insured):
1,795 Series 1,
4.950% 01/01/11............ Aaa AAA 1,818
2,990 AMT, Series 2,
5.750% 07/01/14............ Aaa AAA 3,157
1,500 Florida State, Municipal
Power Agency Revenue,
Refunding, (St. Lucie
Project), (FGIC In
5.250% 10/01/21............ Aaa AAA 1,530
1,000 Florida State, Sr Lien,
Refunding - Jacksonville
Transportation,
5.000% 07/01/19............ Aa2 AA+ 1,008
3,000 Gainsville, Florida,
Utilities System Revenue,
Series B,
6.500% 10/01/11............ Aa3 AA 3,635
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
34
<PAGE> 39
NATIONS FUNDS
Nations Florida Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATINGS VALUE
(000) MOODY'S S&P (000)
- --------------------------------------------------------------------
<C> <S> <C> <C> <C>
FLORIDA -- (CONTINUED)
$ 1,000 Greater Orlando Aviation
Authority, (FGIC Insured),
5.125% 10/01/12............ Aaa AAA $ 1,039
2,000 Hillsborough County,
Florida, Aviation Authority
Revenue, Refunding, Tampa
International
(AMBAC Insured),
5.125% 10/01/17............ Aaa AAA 2,056
1,000 Hillsborough County,
Florida, Industrial
Development Authority, PCR,
(Tampa Electric Company
Project),
8.000% 05/01/22............ Aa3 AA 1,161
1,000 Hillsborough County,
Florida, Utility Refunding
Revenue, (MBIA Insured),
5.500% 08/01/12............ Aaa AAA 1,058
2,000 Jacksonville, Florida,
Electrical Authority
Revenue, Water & Sewer
System - Series A,
(FGIC Insured),
5.400% 10/01/15............ Aaa AAA 2,080
1,500 Jacksonville, Florida,
Health Facilities
Authority, Hospital
Revenue,
(Daughters Of Charity),
Series A,
5.000% 11/15/15............ Aa2 AA 1,513
750 Jacksonville, Florida, PCR,
5.7000% 08/01/31........... A1 A+ 809
Jacksonville, Florida, Sales
Tax Revenue, (River City
Renaissance Project), (FGIC
Insured):
5,000 5.650% 10/01/14............. Aaa AAA 5,406
5,000 5.375% 10/01/18............. Aaa AAA 5,199
2,430 Leon County, Florida,
Capital Improvement
Revenue, (AMBAC Insured),
5.250% 10/01/17............ Aaa AAA 2,558
Martin County, Florida,
Industrial Development
Authority Revenue,
(Indiantown Cogeneration):
3,500 Series A, AMT,
7.875% 12/15/25............ Baa3 BBB- 4,119
2,500 Series B,
8.050% 12/15/25............ Baa3 BBB- 2,943
2,620 Miami Beach, Florida, Water
& Sewer Revenue, (FSA
Insured),
5.375% 09/01/15............ Aaa AAA 2,785
2,000 North Broward, Florida,
Refunding, Hospital
Distribution Revenue,
5.250% 01/15/17............ Aaa AAA 2,067
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATINGS VALUE
(000) MOODY'S S&P (000)
- --------------------------------------------------------------------
<C> <S> <C> <C> <C>
FLORIDA -- (CONTINUED)
$ 5,000 Okaloosa County, Florida,
Gas Distribution Revenue,
Refunding, (MBIA Insured),
6.875% 10/01/19............ Aaa AAA $ 5,888
Orange County, Florida,
Health Facilities Authority
Refunding:
1,000 (Orlando Regional Medical
Center Hospital), Series B,
(MBIA Insured),
5.000% 10/01/10............ Aaa AAA 1,041
4,520 (Orlando Regional
Healthcare), Series A,
(MBIA Insured),
6.250% 10/01/16............ Aaa AAA 5,365
1,000 Orange County, Florida,
Sales Tax Revenue, Series
B,
5.375% 01/01/24............ A1 A+ 1,029
1,000 Orange County, Florida,
Tourist Development Tax
Revenue, Series B,
(MBIA Insured),
6.000% 10/01/14............ Aaa AAA 1,115
3,000 Orlando, Florida, Utilities
Commission, Water &
Electrical Revenue,
Refunding, Series
6.750% 10/01/17............ Aa2 AA- 3,732
1,000 Osceola County, Florida,
Health Facilities Authority
Revenue Refunding,
Lutheran Good Samaritan
Society, (AMBAC Insured),
6.000% 05/01/10............ Aaa AAA 1,105
1,500 Palm Beach County, Florida,
Health Facilities Authority
Revenue, (Good Samaritans
Health System),
6.200% 10/01/11............ NR A+ 1,709
665 Palm Beach County, Florida,
Housing Finance Authority,
Single-family
Mortgage Purchase Revenue,
Series A, (GNMA/FNMA
Collateral),
6.500% 10/01/21............ Aaa NR 718
Palm Beach County, Florida,
Solid Waste Authority
Revenue, Refunding, Series
A, (AMBAC):
935 Prerefunded,
6.000% 10/01/10............ NR AAA 1,090
5,065 Unrefunded Balance,
6.000% 10/01/10............ Aaa AAA 5,897
2,000 Pensacola, Florida, Airport
Revenue, AMT, Series B,
(MBIA Insured),
5.625% 10/01/14............ Aaa AAA 2,172
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
35
<PAGE> 40
NATIONS FUNDS
Nations Florida Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATINGS VALUE
(000) MOODY'S S&P (000)
- --------------------------------------------------------------------
<C> <S> <C> <C> <C>
FLORIDA -- (CONTINUED)
$ 1,000 Polk County, Florida,
Industrial Development
Authority, Solid Waste
Disposal Facilities
Revenue, (Tampa Electric
Company Project),
5.850% 12/01/30............ Aa2 AA $ 1,087
2,000 South Broward, Florida,
Hospital District Revenue
Refunding, (FSA Insured),
5.500% 05/01/28............ Aaa AAA 2,076
4,000 South Miami, Florida, Health
Facilities Authority,
Hospital Revenue,
Refunding,
Baptist Health System
Obligation Group, (MBIA
Insured),
5.375% 10/01/16............ Aaa AAA 4,178
2,500 Sunrise Lakes, Florida,
Phase 4 Recreational
District, Series A,
6.750% 08/01/24............ NR BBB- 2,949
Tampa, Florida, Sports
Authority Revenue, (Stadium
Project), (MBIA Insured):
2,500 Sales Tax,
5.750% 10/01/15............ Aaa AAA 2,836
Local Option Sales Tax:
1,000 5.125% 01/01/12............. Aaa AAA 1,055
2,000 5.250% 01/01/17............. Aaa AAA 2,099
Venice, Florida, Health
Facilities Revenue
Refunding, (Venice Hospital
Inc. Project):
900 5.600% 12/01/05............. AAA NR 993
1,000 5.700% 12/01/06............. AAA NR 1,109
1,000 Volusia County, Florida,
Educational Facilities
Authority Revenue, Series
A,
6.125% 10/15/26............ Baa2 NR 1,084
--------
137,229
--------
GUAM -- 7.7%
Guam, Airport Authority
Revenue:
3,820 Series A,
6.375% 10/01/10............ NR BBB 4,199
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATINGS VALUE
(000) MOODY'S S&P (000)
- --------------------------------------------------------------------
<C> <S> <C> <C> <C>
GUAM -- (CONTINUED)
$ 2,435 Series B,
6.400% 10/01/05............. NR BBB $ 2,665
2,500 Guam, Government, GO, Series
A,
5.750% 09/01/04............ NR BBB 2,516
3,000 Guam, Power Authority
Revenue, Series A,
6.750% 10/01/24............ NR BBB 3,379
--------
12,759
--------
PUERTO RICO -- 6.3%
1,000 Puerto Rico, Electrical
Power Authority, Power
Revenue, Series AA, (MBIA
Insured),
5.250% 07/01/17............ Aaa AAA 1,055
4,190 Puerto Rico Commonwealth,
GO, (MBIA Insured),
6.500% 07/01/15............ Aaa AAA 5,151
995 Puerto Rico, Housing, Bank
and Finance Agency,
Single-family Mortgage
Revenue, (Affordable
Housing Mortgage-Portfolio
I), AMT, (GNMA/FNMA/FHLMC
Collateral),
6.250% 04/01/29............ Aaa AAA 1,063
1,000 Puerto Rico, Industrial,
Tourist, Educational,
Medical & Environmental
Control Faciliti Hospital
Auxilio Mutuo Obligation
Group, Series A,
(MBIA Insured),
6.250% 07/01/16............ Aaa AAA 1,129
2,000 Puerto Rico Commonwealth,
Infrastructure Financing
Authority, Series A, (AMBAC
Insured)
5.000% 07/01/16............ Aaa AAA 2,064
--------
10,462
--------
TOTAL MUNICIPAL
BONDS AND NOTES
(Cost $144,901)..................... 160,450
--------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
36
<PAGE> 41
NATIONS FUNDS
Nations Florida Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
SHARES (000)
- ------------------------------------------------------------------
<C> <S> <C> <C>
INVESTMENT COMPANY -- 2.2%
(Cost $3,754)
3,754,000 AIM Tax-Exempt Fund...................... $ 3,754
--------
TOTAL INVESTMENTS (Cost
$148,655*)....................... 98.6% 164,204
--------
OTHER ASSETS AND
LIABILITIES (NET)................ 1.4
Receivable for fund shares sold.......... $ 641
Dividends and interest receivable........ 3,368
Other assets............................. 10
Payable for fund shares redeemed......... (1,439)
Investment advisory fee payable.......... (55)
Administration fees payable.............. (11)
Shareholder servicing and distribution
fees payable............................ (106)
Dividend payable......................... (2)
Accrued trustees' fees and expenses...... (3)
Accrued expenses and other liabilities... (98)
--------
TOTAL OTHER ASSETS AND LIABILITIES
(NET)................................... 2,305
--------
NET ASSETS........................ 100.0% $166,509
========
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
PRIMARY A SHARES:
($75,390,000/7,397,989 shares
outstanding)............................ $10.19
========
INVESTOR A SHARES:
($73,898,000/7,251,008 shares
outstanding)............................ $10.19
========
</TABLE>
<TABLE>
<CAPTION>
VALUE
(000)
- ------------------------------------------------------------------
<C> <S> <C> <C>
INVESTOR B SHARES:
($17,218,000/1,689,498 shares
outstanding)............................ $10.19
========
INVESTOR C SHARES:
($3,000/282 shares outstanding).......... $10.19
========
NET ASSETS CONSIST OF:
Undistributed net investment income...... $ 19
Accumulated net realized loss on
investments sold........................ (896)
Net unrealized appreciation of
investments............................. 15,549
Paid-in capital.......................... 151,837
--------
NET ASSETS............................... $166,509
========
</TABLE>
- ---------------
* Federal Income Tax Information: Net unrealized appreciation of investment
securities was comprised of gross appreciation of $16,455,000 and gross
depreciation of $906,000 for federal income tax purposes. At September 30,
1998, the aggregate cost of securities for federal income tax purposes was
$148,655,000.
Nations Florida Municipal Bond Fund had the following insurance concentrations
greater than 10% at September 30, 1998 (as a percentage of net assets):
MBIA 28.12%
FGIC 12.21%
SEE NOTES TO FINANCIAL STATEMENTS.
37
<PAGE> 42
NATIONS FUNDS
Nations Georgia Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 96.1%
GEORGIA -- 96.1%
$ 2,000 Albany Dougherty, Georgia,
Solid Waste Disposal
Revenue, Procter & Gamble
Paper Products,
5.300% 05/15/26........... Aa2 AA $ 2,054
1,000 Alpharetta, Georgia, GO,
6.000% 05/01/03........... Aa2 AA- 1,093
Atlanta, Georgia, Airport
Facilities Revenue
Refunding, (AMBAC
Insured):
1,000 5.000% 01/01/03............ Aaa AAA 1,046
1,000 6.000% 01/01/03............ Aaa AAA 1,085
8,000 7.250% 01/01/10+........... Aaa AAA 4,554
1,000 Atlanta, Georgia, Downtown
Development Authority
Revenue Refunding,
(Underground Atlanta
Project),
6.250% 10/01/12........... Aa3 AA 1,097
1,000 Atlanta and Fulton
Counties, Georgia,
Recreation Authority
Revenue Refunding,
(Atlanta Zoo Project),
5.850% 12/01/00........... Aa3 AA 1,046
3,000 Baldwin County, Georgia,
School District, GO,
(State Aid Withholding),
4.500% 01/01/03........... NR AA- 3,086
2,750 Bibb County, Georgia, GO,
5.500% 01/01/08........... A1 AA 2,942
1,000 Burke County, Georgia,
Development Authority,
PCR, (Oglethorpe Power
Corporation), Series B,
4.700% 01/01/04........... A3 A 1,028
2,500 Cartersville, Georgia,
Development Authority
Revenue Refunding,
(Anheuser-Busch),
5.625% 05/01/09........... A1 A+ 2,737
1,000 Chatham County, Georgia,
School District, GO,
5.800% 08/01/04........... A1 AA 1,070
Cherokee County, Georgia,
School System Revenue, GO:
1,000 5.900% 06/01/02............ A1 NR 1,073
1,000 (AMBAC Insured),
5.875% 02/01/09........... Aaa AAA 1,140
820 Cherokee County, Georgia,
Water and Sewer Authority,
Revenue Refunding and
Improvement (MBIA
Insured),
5.300% 08/01/09........... Aaa AAA 899
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
GEORGIA -- (CONTINUED)
Clark County, Georgia,
Hospital Authority
Revenue, (Regional Medical
Center Project), (MBIA
Insured):
$ 1,000 5.100% 07/01/04............ Aaa AAA $ 1,065
1,000 5.750% 01/01/08............ Aaa AAA 1,084
1,000 Clayton County, Georgia,
Water and Sewer Authority
Revenue, (MBIA Insured),
5.400% 05/01/07........... Aaa AAA 1,073
1,000 Clayton County, Georgia,
Hospital Authority Revenue
(MBIA Insured),
6.700% 08/01/02........... Aaa AAA 1,099
3,190 Clayton County, Georgia,
Hospital Authority
Revenue, Anticipated
Certificates, (Southern
Regional Medical Center
Project), Series A, (MBIA
Insured),
5.250% 08/01/09........... Aaa AAA 3,427
1,000 Cobb County, Georgia,
Detention Buildings and
Facilities, GO,
5.300% 01/01/08........... Aaa AAA 1,066
Cobb County, Georgia,
Kennestone Hospital
Authority Revenue, Series
A:
1,200 5.600% 04/01/05............ Aa2 AA 1,286
1,000 5.700% 04/01/06............ Aa2 AA 1,074
Cobb County, Georgia,
School District, GO:
2,000 4.800% 02/01/04............ Aa1 AA 2,094
2,000 Series B,
6.150% 02/01/03........... Aa1 AA 2,188
Cobb County, Georgia, Water
and Sewer Authority,
Revenue Refunding, Series
A:
1,000 5.400% 07/01/08............ Aa1 AA 1,072
2,000 Cobb County and Marietta,
Georgia, Water Authority
Revenue Refunding,
5.000% 11/01/03........... Aa1 AA 2,114
Columbus, Georgia, Water
and Sewer Authority
Revenue Refunding:
1,000 5.100% 05/01/03............ A3 A+ 1,051
2,250 Series 1992, (FGIC
Insured),
6.000% 05/01/03........... Aaa AAA 2,459
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
38
<PAGE> 43
NATIONS FUNDS
Nations Georgia Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
GEORGIA -- (CONTINUED)
$ 1,000 Dalton, Georgia, Building
Authority Revenue,
5.000% 07/01/02........... A1 NR $ 1,043
Dalton, Georgia, Multiple
Utility Revenue Refunding,
(MBIA Insured):
2,000 4.450% 01/01/03............ Aaa AAA 2,054
5,000 6.000% 01/01/06............ Aaa AAA 5,641
1,000 DeKalb County, Georgia,
School District, GO,
5.000% 07/01/03........... Aa AA 1,053
1,000 Downtown Savannah
Authority, Georgia,
(Chatham County Projects),
Series A,
5.000% 01/01/11........... Aa3 AA 1,030
6,440 Effingham County, Georgia,
Development Authority,
Solid Wasted Disposal
Revenue, (Fort James
Project),
5.625% 07/01/18........... Baa2 BBB- 6,547
Fayette County, Georgia,
School District, GO,
Series 1992:
1,000 5.200% 03/01/00............ Aa A+ 1,023
1,000 (FGIC Insured),
6.100% 03/01/03........... Aaa AAA 1,092
3,800 Forsyth County, Georgia,
Water & Sewer Authority
Revenue,
5.000% 04/01/02........... Aa3 AA- 3,961
Fulco, Georgia, Hospital
Authority Revenue, Revenue
Anticipation Certificates:
Georgia Baptist
Healthcare, Series A, Pre
Refunded:
1,500 5.800% 09/01/01............ Aaa NR 1,586
1,000 6.000% 09/01/03............ Aaa NR 1,097
St. Joseph's Hospital:
2,000 4.900% 10/01/03............ A3 A 2,097
1,000 5.500% 10/01/14............ A3 A 1,071
2,000 (Catholic Health East),
4.600% 11/15/09........... Aaa AAA 2,053
1,735 Fulton County, Georgia,
Development Authority
Revenue,
5.000% 09/01/17........... Aa1 AA+ 1,766
1,000 Fulton and DeKalb Counties,
Georgia, Hospital
Authority, Revenue
Refunding, (Grady Memorial
Hospital Project),
(MBIA Insured),
5.250% 01/01/04........... Aaa AAA 1,065
Fulton County, Georgia,
Building Authority Revenue
Refunding:
1,000 5.700% 01/01/00............ Aa3 AA 1,026
1,025 5.700% 01/01/04............ Aa3 AA 1,114
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
GEORGIA -- (CONTINUED)
$ 1,000 Fulton County, Georgia,
Hospital Authority Revenue
Refunding, Revenue
Anticipation Certificates,
(Northside Hospital
Project), Series A, (MBIA
Insured),
6.000% 10/01/01............ Aaa AAA $ 1,066
Fulton County, Georgia,
School District, GO:
1,000 7.500% 01/01/02............ Aa3 AA 1,113
1,500 6.250% 05/01/04............ Aa3 AA 1,681
1,000 George L. Smith II,
Georgia, World congress
Control Authority,
Revenue, (Domed Stadium
Project), (SunTrust Bank
LOC),
7.875% 07/01/20........... Aa3 AA- 1,085
Georgia State, GO:
1,500 Series A,
6.250% 03/01/06............ Aaa AAA 1,724
1,200 Series B,
6.000% 03/01/04........... Aaa AAA 1,328
Series C:
2,750 6.500% 07/01/05............ Aaa AAA 3,176
3,500 5.750% 09/01/09............ Aaa AAA 3,997
1,000 Georgia State, Housing &
Finance Authority Revenue,
Home Ownership,
6.600% 6/01/25............ Aa2 AA+ 1,078
1,500 Georgia State, Municipal
Gas Authority, Gas Tax
Revenue, (Southern Storage
Gas Project),
6.000% 07/01/04........... NR A- 1,654
Georgia State Tollway
Authority Revenue,
(Georgia 400 Project), (ST
GTD):
2,000 6.375% 07/01/02............ Aaa AA+ 2,178
1,000 6.400% 07/01/03............ Aaa AAA 1,090
1,000 5.000% 07/01/07............ Aaa AAA 1,076
Griffin-Spalding
County,Georgia, School
System, GO, (FSA Insured):
1,000 5.250% 02/01/10............ Aaa AAA 1,039
2,000 5.600% 02/01/21............ Aaa AAA 2,078
Gwinnett County, Georgia,
School District, GO:
1,000 5.250% 02/01/08............ Aa1 AA+ 1,044
1,400 5.375% 02/01/09............ Aa1 AA+ 1,474
1,000 Refunding, Series B,
6.000% 02/01/01........... Aa1 AA+ 1,052
Hall County, Georgia,
School District, GO:
2,000 (AMBAC Insured),
6.700% 12/01/14........... Aaa AAA 2,341
1,000 Refunding, Series B,
6.300% 12/01/05........... A1 NR 1,147
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
39
<PAGE> 44
NATIONS FUNDS
Nations Georgia Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
GEORGIA -- (CONTINUED)
$ 1,000 Henry City and County,
Georgia, Water and Sewer
Authority Revenue
Refunding, Series A,
5.000% 02/01/07........... A NR $ 1,052
Henry County, Georgia,
School District, GO:
1,000 Series A,
5.700% 08/01/02........... A1 A+ 1,070
1,000 Series B,
5.600% 08/01/01........... A1 A+ 1,052
2,000 Henry County, Georgia,
Hospital (AMBAC Insured),
5.250% 07/01/09........... Aaa AAA 2,180
2,000 Houston County, Georgia,
School District, GO, (MBIA
Insured),
5.500% 03/01/16........... Aaa AAA 2,072
1,000 La Grange, Georgia, Water &
Sewer Revenue,
7.375% 01/01/12........... NR NR 1,064
1,000 Macon, Georgia, Water and
Sewer Authority Revenue
Refunding, Series A,
4.700% 10/01/04........... A1 A+ 1,044
1,000 Macon-Bibb County, Georgia,
Industrial Authority,
Industrial Revenue,
(Weyerhaeuser Company
Project),
9.000% 10/01/07........... A2 A 1,361
1,000 Meriwether County, Georgia,
School District, GO, (FSA
Insured),
5.500% 02/01/16........... Aaa AAA 1,078
Metropolitan Atlanta Rapid
Transit Authority (MARTA),
Georgia, Sales Tax Revenue
Refunding:
1,000 Series B, Second Indenture,
5.100% 07/01/15........... Aaa AAA 1,038
540 Series D,
7.000% 07/01/11........... AAA AAA 678
Series M:
1,000 6.150% 07/01/02............ A1 AA- 1,078
1,000 6.350% 07/01/04............ A1 AA- 1,079
3,000 Refunding, Series P, (AMBAC
Insured),
5.900% 07/01/03........... Aaa AAA 3,274
1,000 Monroe County, Georgia,
Development Authority,
PCR, (Oglethorpe Power
Corporation), Series A,
6.800% 01/01/12........... A3 A 1,216
2,495 Municipal Electric
Authority, Georgia,
(Project One), Series A,
(MBIA Insured),
5.375% 01/01/19........... Aaa AAA 2,619
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
GEORGIA -- (CONTINUED)
$ 1,100 Paulding County, Georgia,
School District, GO,
Series A,
6.400% 02/01/04........... A2 A $ 1,230
1,715 Port Houston Authority Tex
Harris (MBIA Insured),
4.850% 10/01/07+.......... Aaa AAA 1,183
1,400 Private Colleges and
Universities Facilities
Authority Revenue,
Georgia, (Emory University
Project), Series C, (GO of
Instn),
5.750% 10/01/02........... Aa1 AA 1,505
1,000 Richmond County, Georgia,
Board of Education, GO,
(FGIC Insured),
4.700% 11/01/06........... Aaa AAA 1,045
1,500 Richmond County, Georgia,
Water and Sewer Revenue
Refunding and Improvement,
Series A, (FGIC Insured),
5.250% 10/01/28........... Aaa AAA 1,544
2,000 Roswell, Georgia, GO,
5.600% 02/01/10........... Aa AA 2,189
1,000 Savannah, Georgia, Economic
Development Authority
Refunding, PCR, (Union
Camp Corporation Project),
5.150% 05/01/02........... A1 NR 1,044
Savannah, Georgia, Hospital
Authority Revenue, (St.
Josephs/Candler Health
System):
Series A:
1,225 5.250% 07/01/11............ Aaa NR 1,304
1,310 5.250% 07/01/12............ Aaa NR 1,386
1,000 Series B, (FSA Insured),
5.250% 07/01/10............ Aaa NR 1,071
1,250 Savannah, Georgia, Hospital
Authority Revenue
Refunding and Improvement,
(Candler Hospital
Project), Pre-Refunded,
7.000% 01/01/11........... Aaa AAA 1,418
Savannah, Georgia, Resource
Recovery Development
Authority, Revenue
Refunding, (Southern
Energy Systems Company
Project):
1,000 5.700% 12/01/00............ A1 A+ 1,041
1,500 5.850% 12/01/01............ A1 A+ 1,590
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
40
<PAGE> 45
NATIONS FUNDS
Nations Georgia Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
GEORGIA -- (CONTINUED)
$ 1,000 Savannah, Georgia, Water
and Sewer Revenue
Refunding and Improvement,
5.100% 12/01/09........... Aa3 AA- $ 1,048
--------
TOTAL MUNICIPAL
BONDS AND NOTES
(Cost $148,936).................... 158,395
--------
</TABLE>
<TABLE>
<CAPTION>
SHARES
- ----------
<C> <S> <C> <C>
INVESTMENT COMPANY -- 3.0% (Cost $5,000)
5,000,000 AIM Tax-Exempt Fund....................... 5,000
--------
</TABLE>
<TABLE>
<C> <S> <C> <C>
TOTAL INVESTMENTS 99.1%
(Cost $153,936*).................. 163,395
--------
OTHER ASSETS AND 0.9
LIABILITIES (NET).................
Receivable for fund shares sold........... $ 114
Dividends and interest receivable......... 2,103
Payable for fund shares redeemed.......... (22)
Investment advisory fee payable........... (42)
Administration fees payable............... (10)
Shareholder servicing and distribution
fees payable............................. (48)
Dividend payable.......................... (498)
Accrued trustees' fees and expenses....... (7)
Accrued expenses and other liabilities.... (42)
--------
TOTAL OTHER ASSETS AND
LIABILITIES (NET)........................ 1,548
--------
NET ASSETS......................... 100.0% $164,943
========
</TABLE>
<TABLE>
<CAPTION>
- ------------------------------------------------------------------
VALUE
(000)
<C> <S> <C> <C>
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
PRIMARY A SHARES: ($131,484,000/11,849,434
shares outstanding)...................... $11.10
========
INVESTOR A SHARES: ($24,918,000/2,245,657
shares outstanding)...................... $11.10
========
INVESTOR B SHARES: ($7,695,000/693,451
shares outstanding)...................... $11.10
========
INVESTOR C SHARES: ($846,000/76,261 shares
outstanding)............................. $11.10
========
NET ASSETS CONSIST OF:
Undistributed net investment income....... $ 11
Accumulated net realized gain
on investments sold...................... 461
Net unrealized appreciation of
investments.............................. 9,459
Paid-in capital........................... 155,012
--------
NET ASSETS................................ $164,943
========
</TABLE>
- ---------------
* Federal Income Tax Information: Net unrealized appreciation of investment
securities was comprised of gross appreciation of $9,459,000 for federal
income tax purposes. At September 30, 1998, the aggregate cost of securities
for federal income tax purposes was $153,936,000.
+ Zero coupon security. The rate shown reflects the yield to maturity.
Nations Georgia Intermediate Municipal Bond Fund had the following insurance
concentrations greater than 10% at September 30, 1998 (as a percentage of net
assets):
MBIA 14.76%
AMBAC 10.17%
SEE NOTES TO FINANCIAL STATEMENTS.
41
<PAGE> 46
NATIONS FUNDS
Nations Georgia Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 101.0%
GEORGIA -- 101.0%
$ 500 Albany, Georgia, Sewer
System Revenue, (MBIA
Insured),
4.900% 07/01/07............ Aaa AAA $ 533
500 Albany Dougherty, Georgia,
Solid Waste Disposal
Revenue, Procter & Gamble
Paper Products,
5.300% 05/15/26............ Aa2 AA 514
500 Atlanta & Fulton County,
Georgia, Recreational
Authority Revenue,
(Downtown Arena Public
Improvement Project),
Series A, (MBIA Insured),
5.375% 12/01/26............ Aaa AAA 525
500 Bartow County, Georgia
School District, GO, Series
1993,
5.300% 05/01/08............ A A 530
500 Brunswick & Glynn County,
Georgia, Development
Authority Revenue, (Pacific
Corporate Project),
5.550% 03/01/26............ Baa2 NR 508
500 Burke County, Georgia,
Development Authority, PCR,
(Oglethorpe Power
Corporation Project),
Series B,
4.700% 01/01/04............ A3 A 514
500 Clayton County, Georgia,
Housing Authority, Multi-
family Housing Revenue,
(Advantages of Atlanta
Apartments Project), (FHLMC
Collateral),
5.700% 12/01/16............ NR AAA 520
500 Columbia County, Georgia,
School District, Series B,
(MBIA Insured),
6.250% 04/01/13............ Aaa AAA 560
500 Columbus, Georgia, Water and
Sewer Authority Revenue
Refunding,
5.700% 05/01/20............ A3 A+ 531
470 Coweta County, Georgia,
Development Authority,
Industrial Development
Revenue, (Sivaco National
Wire Project), AMT,
5.400% 02/01/09............ A1 NR 495
500 Dalton, Georgia, Multiple
Utility Revenue Refunding,
(MBIA Insured),
4.450% 01/01/03............ Aaa AAA 513
1,000 Effingham County, Georgia,
Solid Waste Disposal
Revenue, (Fort James
Project),
5.625% 07/01/18............ Baa2 BBB- 1,017
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
GEORGIA -- (CONTINUED)
$ 500 Fayette County, Georgia,
School District, GO,
6.125% 03/01/15............ Aa A+ $ 554
500 Fayette County, Georgia,
Water Revenue, (FGIC
Insured),
5.000% 10/01/23............ Aaa AAA 501
1,000 Fulco, Georgia, Hospital
Authority Revenue, Revenue
Anticipation Certificates,
St. Joseph's Hospital,
5.500% 10/01/14............ A3 A 1,071
500 Fulton County, Georgia,
Development Authority
Revenue, (Clark Atlanta
University Project),
(CONNIE LEE Insured),
5.125% 01/01/10............ Baa2 AAA 524
1,000 Galena Park, Texas,
Independent School
District, GO, (PSFG-GTD),
6.375% 08/15/24+........... Aaa NR 282
700 Georgia State, GO, Series C,
7.250% 07/01/00............ Aaa AAA 743
1,550 Georgia State, Housing &
Financial Authority
Revenue, Single Family
Mortgage, Series B3,
4.400% 06/01/17............ NR AAA 1,554
500 Georgia State Municipal
Electric Authority Power
Revenue, Series CC,
4.500% 01/01/02............ A3 A 509
500 Georgia State Tollway
Authority Revenue,
4.500% 07/01/11............ Aaa AAA 508
500 Gwinnett County, Georgia,
Water and Sewer Revenue
Refunding,
4.900% 08/01/06............ Aaa AAA 533
500 Hall County Georgia, School
District, (State Aid
Withholdings),
4.5000% 11/01/14........... Aa3 NR 490
500 Lawrenceville, Georgia,
Housing Authority, Multi-
family Housing Revenue,
(Knollwood Park Apartments
Project), (FNMA
Collateral),
6.25% 12/01/29............. NR AAA 552
500 Metropolitan, Atlanta, Rapid
Transportation Authority,
Sales Tax Revenue, Series
B, (MBIA Insured),
5.100% 07/01/13............ Aaa AAA 525
500 Peach County, Georgia,
School District, GO, (MBIA
Insured),
6.500% 02/01/08............ Aaa AAA 591
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
42
<PAGE> 47
NATIONS FUNDS
Nations Georgia Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
GEORGIA -- (CONTINUED)
$ 500 Private Colleges &
Universities Authority
Georgia Revenue, (Emory
University Project),
Series C,
5.125% 11/01/27............ Aa1 AA $ 507
500 Private Colleges &
Universities Authorities,
Georgia, Student Loan
Revenue, Series B,
5.000% 11/01/33............ Aa1 AA 495
500 Richmond County, Georgia,
Water & Sewer Revenue,
(FGIC Insured),
5.250% 10/01/28............ Aaa AAA 515
1,000 Roswell, Georgia, GO,
5.600% 02/01/10............ Aa AA 1,094
Savannah, Georgia, Hospital
Authority, Revenue
Refunding and Improvement,
Pre Refunded:
500 (Candler Hospital Project),
7.000% 01/01/23............ Aaa Aaa 567
450 (St. Joseph's Hospital
Project), Pre Refunded,
6.125% 07/01/12............ Aaa Aaa 500
1,000 (St. Josephs/Candler Health
System), Series A,
5.000% 07/01/23............ Aaa NR 997
500 Savannah, Georgia, Water and
Sewer Revenue Refunding and
Improvement,
5.100% 12/01/10............ Aa3 AA- 521
500 Union County, Georgia,
Housing Authority, Multi-
family Housing Revenue
Refunding, (Hidden Lake
Apartments), Series A,
(FHA/FNMA),
7.125% 12/01/25............ Aaa NR 549
500 Upper Oconee Basin Water
Authority, Georgia Revenue,
(FGIC Insured),
5.2500% 07/01/27........... Aaa AAA 516
570 White County, Georgia,
Industrial Development
Authority Revenue
Refunding, (Clark-Schwebel
Fiber and Glass Company
Project),
6.850% 06/01/10............ NR BBB+ 613
-------
TOTAL MUNICIPAL BONDS AND NOTES
(Cost $21,248)............................. 22,571
-------
</TABLE>
<TABLE>
<CAPTION>
VALUE
SHARES (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
INVESTMENT COMPANIES -- 5.1%
1,115,000 AIM Tax-Exempt Fund........................ $ 1,115
14,000 Nuveen Tax-Exempt Fund..................... 14
-------
</TABLE>
<TABLE>
<C> <S> <C> <C>
TOTAL INVESTMENT COMPANIES
(Cost $1,129)............................. 1,129
-------
TOTAL INVESTMENTS
(Cost $22,377*)................. 106.1% 23,700
-------
OTHER ASSETS AND
LIABILITIES (NET)............... (6.1)%
Receivable for fund shares sold............ 1
Dividends and interest receivable.......... 326
Investment advisory fee payable............ (5)
Administration fees payable................ (1)
Shareholder servicing and distribution fees
payable................................... (47)
Dividend payable........................... (47)
Payable for investment securities
purchased................................. (1,560)
Accrued trustees' fees and expenses........ (1)
Accrued expenses and other liabilities..... (19)
-------
TOTAL OTHER ASSETS AND
LIABILITIES (NET)......................... (1,353)
-------
NET ASSETS....................... 100.0% $22,347
=======
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
PRIMARY A SHARES:
($9,438,000/920,858 shares outstanding).... $10.25
=======
INVESTOR A SHARES:
($2,250,000/219,562 shares outstanding).... $10.25
=======
INVESTOR B SHARES:
($10,656,000/1,039,762 shares
outstanding).............................. $10.25
=======
INVESTOR C SHARES:
($3,000/281 shares outstanding)............ $10.25
=======
NET ASSETS CONSIST OF:
Undistributed net investment income........ $ 9
Accumulated net realized loss on
investments sold.......................... (220)
Net unrealized appreciation of
investments............................... 1,323
Paid-in capital............................ 21,235
-------
NET ASSETS................................. $22,347
=======
</TABLE>
- ---------------
* Federal Income Tax Information: Net unrealized appreciation of investment
securities was comprised of gross appreciation of $1,323,000 and for federal
income tax purposes. At September 30, 1998, the aggregate cost of securities
for federal income tax purposes was $22,377,000.
+ Zero coupon security. The rate shown reflects the yield to maturity.
Nations Georgia Municipal Bond Fund had the following insurance concentration
greater than 10% at September 30, 1998 (as a percentage of net assets):
MBIA 14.53%
SEE NOTES TO FINANCIAL STATEMENTS.
43
<PAGE> 48
NATIONS FUNDS
Nations Maryland Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 98.3%
MARYLAND -- 85.2%
Anne Arundel County,
Maryland, Consolidated
Public Improvement Revenue,
GO:
$ 1,000 6.900% 01/15/00............. Aa1 AA+ $ 1,029
1,000 6.200% 04/15/03............. Aa1 AA+ 1,076
1,000 5.125% 07/15/08............. Aa1 AA+ 1,060
2,000 Anne Arundel County,
Consolidated
Water & Sewer,
4.8000% 04/15/05........... Aa1 AA+ 2,107
Baltimore, Maryland,
Consolidated Public
Improvement Revenue, (FGIC
Insured):
1,740 Series A,
5.300% 10/15/16............ Aaa AAA 1,843
1,720 Series C,
6.200% 10/15/02............ Aaa AAA 1,880
1,000 Baltimore, Maryland,
Convention Center Revenue,
(MBIA Insured),
5.000% 09/01/06............ Aaa AAA 1,070
Baltimore, Maryland, GO,
Series B, (MBIA Insured):
1,000 7.000% 10/15/04............. Aaa AAA 1,167
1,000 7.050% 10/15/07............. Aaa AAA 1,223
1,000 Baltimore, Maryland, Pension
Funding,
5.500% 08/01/05............ Aaa AAA 1,098
1,750 Baltimore, Maryland, Port
Facilities Revenue,
Consolidated Coal Sales,
Series 85,
6.500% 12/01/10............ Aa3 AA- 1,938
Baltimore, Maryland, Revenue
Refunding, (Wastewater
Projects), Series A: (FGIC
Insured):
500 5.000% 07/01/22............. Aaa AAA 519
500 5.000% 07/01/24............. Aaa AAA 519
1,000 (MBIA Insured),
5.100% 07/01/04............. Aaa AAA 1,067
Baltimore County, Maryland,
Consolidated Public
Improvement, Revenue
Refunding:
1,000 6.100% 07/01/01............. Aaa AAA 1,064
1,000 Series A, (AMBAC Insured),
5.300% 10/15/06............. Aaa AAA 1,060
1,075 Series C, (FGIC Insured),
6.375% 10/15/07............. Aaa AAA 1,264
Baltimore County, Maryland,
Metropolitan District
Special Assignment
Refunding, GO:
1,375 5.750% 05/01/02............. Aaa AAA 1,468
1,000 5.800% 05/01/03............. Aaa AAA 1,085
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
MARYLAND -- (CONTINUED)
$ 1,000 Baltimore, Maryland, Water
Utility Revenue, (Water
Projects), Series A, (MBIA
Insured),
6.950% 07/01/02............. Aaa AAA $ 1,075
2,000 Calvert County, Maryland,
Consolidated Public
Improvement Revenue
Refunding, GO,
4.625% 07/15/05............. Aa AA- 2,087
Carroll County, Maryland,
Consolidated Public
Improvement Revenue, GO:
1,350 6.000% 11/01/00............. Aa3 AA 1,416
500 6.900% 10/01/02............. Aaa AA 541
Cecil County, Maryland,
Revenue Refunding,
Consolidated Public
Improvement, GO, (FGIC
Insured):
1,000 5.300% 12/01/00............. Aaa AAA 1,036
2,000 4.800% 12/01/04............. Aaa AAA 2,107
Charles County, Maryland,
Consolidated Public
Improvement, Revenue
Refunding, GO:
1,000 4.400% 06/01/03............. Aa3 AA- 1,027
750 6.450% 06/01/04............. AAA AA- 817
1,000 6.375% 12/01/04............. AAA AA- 1,053
1,810 (AMBAC Insured),
5.900% 01/15/03............. Aaa AAA 1,963
Frederick County, Maryland,
Consolidated Public
Improvement, Revenue
Refunding, GO, (FGIC
Insured):
2,000 5.750% 12/01/01............. Aaa AAA 2,127
2,240 6.000% 12/01/05............. Aaa AAA 2,454
2,135 Frederick County,
Maryland, GO,
5.350% 07/01/05............ Aa AA 2,281
1,000 Frederick County, Maryland,
GO, Series B,
6.300% 07/01/06............ Aa AA- 1,103
1,920 Harford County,
Maryland, GO,
5.500% 12/01/07............ Aa2 AA- 2,139
600 Harford County, Maryland,
GO, Refunded,
6.100% 12/01/04............ AAA AAA 642
1,455 Harford County, Maryland,
Public Improvement Revenue,
GO,
5.300% 09/01/03............ Aa2 AA- 1,554
Howard County, Maryland,
Consolidated Public
Improvement - Series A:
1,545 5.000% 08/15/03............. Aaa AAA 1,630
2,000 5.250% 08/15/06............. Aaa AAA 2,151
1,000 Howard County, Maryland,
Metropolitan District, GO,
Series B,
6.000% 08/15/03............ Aaa AAA 1,099
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
44
<PAGE> 49
NATIONS FUNDS
Nations Maryland Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
MARYLAND -- (CONTINUED)
$ 605 Laurel, Maryland, GO, Series
A, (MBIA Insured),
6.300% 07/01/00............ Aaa AAA $ 633
1,530 Laurel, Maryland, Public
Improvement Refunding,
Series A, (FGIC Insured),
5.000% 10/01/11............ Aaa AAA 1,604
500 Maryland-National Capital
Park and Planning
Commission, (Prince Georges
County), GO, Series J-2,
Pre-Refunded,
6.900% 07/01/02............ Aa2 AA 537
Maryland State, Certificates
Participation, State
Highway & Motor Vehicle
Administration:
1,200 5.700% 06/01/01............. A1 AA- 1,259
1,200 5.800% 06/01/02............. A1 AA- 1,261
1,000 Maryland State, Community
Development Administration,
Department of Housing and
Community Development,
(Single-family Project),
First Series, (FHA
Insured),
4.950% 04/01/07............ Aa2 NR 1,030
1,100 Maryland State, GO, Third
Series, Refunded,
6.800% 07/15/04............ AAA AAA 1,176
Maryland State, Health and
Higher Education Facilities
Authority Revenue, Howard
County General Hospital:
1,000 5.125% 07/01/03............. Baa1 BBB 1,031
1,000 5.500% 07/01/13............. Baa1 BBB 1,056
1,000 5.500% 07/01/21............. Baa1 BBB 1,047
700 Sinai Hospital, Pre-
Refunded, (AMBAC Insured),
7.000% 07/01/00............. Aa3 AA- 717
500 Refunding,
7.300% 07/01/05............. AAA AAA 541
1,000 Suburban Hospital, Refunded,
6.000% 07/01/21............. AAA AAA 1,079
The Johns Hopkins Hospital:
2,700 5.250% 07/01/04............. Aa3 AA- 2,898
1,500 5.400% 07/01/06............. Aa3 AA- 1,617
3,050 5.500% 07/01/07............. Aa3 AA- 3,294
The Johns Hopkins Hospital,
Refunded:
1,250 7.000% 07/01/01............. AAA AAA 1,345
1,000 5.750% 07/01/09............. AAA AAA 1,139
1,000 Johns Hopkins Medicine,
5.000% 07/01/19............. Aaa AAA 1,008
3,000 Charity Obligation, Group D,
4.600% 11/01/26............. Aa2 AA+ 3,088
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
MARYLAND -- (CONTINUED)
$ 1,000 University of Maryland
Medical System Project,
(FGIC Insured),
5.200% 07/01/04............. Aaa AAA $ 1,068
Maryland State, State and
Local Facilities Loan, GO:
Second Series,
Pre-Refunded:
1,500 5.000% 10/15/04............. Aaa AAA 1,597
3,000 5.000% 07/15/07............. Aaa AAA 3,232
1,000 5.000% 08/01/07............. Aaa AAA 1,078
3,000 Third Series, Pre-Refunded,
5.000% 10/15/06............. Aaa AAA 3,226
Maryland State,
Transportation Authority
Revenue, GO:
1,250 6.100% 09/01/01............. Aa AA 1,317
3,235 4.375% 12/15/03............. Aa AA 3,331
2,300 6.500% 07/01/04............. A1 A+ 2,496
4,000 5.700% 07/01/05............. A1 A+ 4,426
2,800 5.800% 07/01/06............. A1 A+ 3,139
1,395 Maryland State,
Transportation Authority
Revenue, GO, Refunded,
6.625% 07/01/03............ AAA AAA 1,497
1,000 Maryland State,
Transportation Authority,
Special Obligation Revenue,
(Baltimore-Washington D.C.
International Airport
Project), Series A, AMT,
(FGIC Insured),
6.400% 07/01/19............ Aaa AAA 1,067
Montgomery County, Maryland,
Consolidated Public
Improvement, GO, Series A:
1,835 4.875% 05/01/06............. Aaa AAA 1,951
1,000 5.750% 07/01/06............. Aaa AAA 1,123
3,500 4.900% 10/01/07............. Aaa AAA 3,702
1,000 5.375% 05/01/08............. Aaa AAA 1,106
500 Pre-Refunded,
6.700% 04/01/06............. AAA AAA 546
1,000 Montgomery County, Maryland,
GO,
6.250% 06/15/99............. Aaa AAA 1,021
Montgomery County, Maryland,
GO, Refunded:
3,000 6.100% 10/01/05............. AAA AAA 3,262
1,000 6.125% 10/01/07............. AAA AAA 1,088
1,000 Montgomery County, Maryland,
Housing Opportunities
Commission, Single-family
Mortgage Revenue, Series A,
5.400% 07/01/08............ Aa2 NR 1,050
1,575 Montgomery County, Maryland,
Parking Revenue, Bethesda
Parking Lot District,
Series A, (FGIC Insured),
5.700% 06/01/00............ Aaa AAA 1,629
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
45
<PAGE> 50
NATIONS FUNDS
Nations Maryland Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
MARYLAND -- (CONTINUED)
$ 1,535 Northeast Maryland, Solid
Waste Disposal Authority
Revenue Refunding,
(Southwest Resource
Recovery Facility Project),
(MBIA Insured),
7.000% 01/01/01............ Aaa AAA $ 1,641
Ocean City, Maryland, GO,
Refunded, (MBIA Insured):
630 6.100% 11/01/04............. Aaa AAA 686
1,170 5.000% 12/01/14............. Aaa AAA 1,211
Prince Georges County,
Maryland, Consolidated
Public Improvement Revenue,
GO:
1,000 6.500% 07/01/02............. A1 AA- 1,089
1,000 5.600% 01/15/03............. A1 AA- 1,071
1,800 5.900% 01/15/06............. A1 AA- 1,937
Prince Georges County,
Maryland, Consolidated
Public Improvement Revenue,
Series A, (MBIA Insured):
1,000 5.300% 03/01/01............. Aaa AAA 1,039
1,000 5.400% 03/01/02............. Aaa AAA 1,055
1,000 Prince Georges County,
Maryland, Industrial
Development Authority Lease
Revenue (Upper Marlboro
Justice Center Project),
(MBIA Insured),
6.750% 06/30/01............ Aaa AAA 1,045
740 Prince Georges County,
Maryland, Solid Waste
Management System Revenue
6.800% 06/30/04............ AAA AAA 794
Prince Georges County,
Maryland, Solid Waste
Management Systems
Authority, Revenue
Refunding, (FSA Insured):
800 6.600% 06/30/00............. Aaa AAA 841
2,000 5.100% 06/15/05............. Aaa AAA 2,125
1,000 Rockville, Maryland, GO,
4.750% 04/15/05............ Aa1 AA+ 1,036
1,000 St. Mary's County, Maryland,
GO, (MBIA Insured),
5.700% 03/01/08............ Aaa AAA 1,108
University of Maryland,
Auxiliary Facilities and
Tuition Revenue: Series A:
745 6.000% 02/01/04............. Aa3 AA+ 795
2,500 6.400% 04/01/04............. Refunded AAA 2,651
2,000 6.500% 04/01/06............. Refunded AAA 2,123
1,000 6.300% 02/01/08............. Aa3 AA+ 1,078
1,000 6.300% 02/01/10............. Aa3 AA+ 1,078
2,000 Series C,
4.900% 10/01/08............. Aa3 AA+ 2,087
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
MARYLAND -- (CONTINUED)
Washington County, Maryland,
GO:
$ 500 6.400% 12/01/00............. A1 A+ $ 512
1,000 Series F, (FGIC Insured),
5.250% 01/01/06............. Aaa AAA 1,067
2,000 Washington County, Maryland,
Consolidated Public
Improvement, (FGIC
Insured),
4.900% 01/01/02............ Aaa AAA 2,075
1,000 Washington County, Maryland,
Sanitation District
Authority, Series F, (FGIC
Insured),
5.250% 01/01/06............ Aaa AAA 1,067
Washington Suburban
Sanitation District
Authority, Maryland, GO:
General Construction:
1,000 5.000% 06/01/04............. Aa1 AA 1,061
1,000 5.125% 06/01/21............. Aa1 AA 1,019
General Construction,
Refunded:
1,000 6.750% 12/01/03............. AAA AAA 1,058
1,260 6.750% 06/01/05............. AAA AAA 1,382
Water Supply:
1,000 5.000% 06/01/03............. Aa1 AA 1,054
2,010 5.800% 06/01/03............. Aa1 AA 2,187
3,440 5.100% 12/01/07............. Aa1 AA 3,671
1,000 5.600% 06/01/15............. Aa1 AA 1,072
Wicomico County, Maryland,
Public Improvement,
(MBIA Insured):
1,290 4.800% 12/01/10............. Aaa A1 1,342
1,355 4.900% 12/01/11............. Aaa A1 1,412
1,425 5.000% 12/01/12............. Aaa A1 1,491
--------
173,111
--------
ALASKA -- 1.0%
2,000 Alaska State, Industrial
Development Authority,
Revolving Fund -- Series A,
(MBIA Insured),
5.000% 04/01/05............ Aaa AAA 2,093
--------
COLORADO -- 0.7%
3,800 E-470 Public Highway
Authority Revenue,
Colorado, Series B, (MBIA
Insured),
5.470% 09/01/18+............ Aaa AAA 1,460
--------
DISTRICT OF COLUMBIA -- 3.0%
District of Columbia:
50 Prerefunded - Series A,
(AMBAC Insured),
7.125% 06/01/99............ NR AAA 51
950 Unrefunded Balance - Series
A, (AMBAC Insured),
7.125% 06/01/99............ Aaa AAA 973
1,305 Smithsonian Institution,
5.000% 02/01/17............. Aaa AAA 1,308
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
46
<PAGE> 51
NATIONS FUNDS
Nations Maryland Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
DISTRICT OF COLUMBIA -- (CONTINUED)
$ 3,500 Washington DC, Metropolitan
Area, Transportation
Authority Gross Revenue,
(FGIC Insured),
5.000% 07/01/06............ Aaa AAA $ 3,716
--------
6,048
--------
GEORGIA -- 0.5%
1,000 Savannah, Georgia, Hospital
Authority Revenue,
St. Josephs/Candler Health
System - Series B, (FSA
Insured),
5.250% 07/01/08............. Aaa NR 1,076
--------
MAINE -- 1.0%
2,000 Baileyville Pollution
Central Revenue,
4.750% 06/01/05............ Baa2 NR 2,054
--------
OHIO -- 0.8%
1,595 Ohio State, Housing
Financial Agency Mortgage
Revenue, Residential --
Series B-2, (GNMA COLL
Insured),
4.700% 09/01/06............ NR AAA 1,631
--------
TEXAS -- 0.2%
1,000 Bastrop, Texas, Independent
School District, Revenue
Refunding, GO,
(PSF-GTD),
5.650% 02/15/18+........... Aaa AAA 391
--------
VIRGINIA -- 2.6%
1,085 Metropolitan Washington,
D.C., Airports Authority,
Virginia, General Airports
Revenue, AMT, Series B,
(FGIC Insured),
5.750% 10/01/03............ Aaa AAA 1,174
4,000 Virginia State,
Transportation Board,
Transportation Contract
Revenue, Northern Virginia
Transportation District --
Series A,
5.125% 05/15/21............ Aa2 AA 4,034
--------
5,208
--------
WASHINGTON -- 3.3%
3,000 Port Seattle, Washington,
Passenger Facility Charge
Revenue, Series B, (AMBAC
Insured),
5.000% 12/01/08............ Aaa AAA 3,146
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -------------------------------------------------------------------
<C> <S> <C> <C> <C>
WASHINGTON -- (CONTINUED)
$ 3,000 Washington State, Public
Power Supply System Nuclear
Project No. 1 Revenue,
Series A,
7.000% 07/01/08............ Aa1 AA- $ 3,610
--------
6,756
--------
TOTAL MUNICIPAL BONDS AND NOTES
(Cost $188,290)............................ 199,828
--------
</TABLE>
<TABLE>
<CAPTION>
SHARES
- --------
<C> <S> <C> <C> <C>
INVESTMENT COMPANY -- 0.5% (Cost $999)
999,000 AIM Tax-Exempt Fund........................ 999
--------
</TABLE>
<TABLE>
<S> <C> <C>
TOTAL INVESTMENTS
(Cost $189,289*).......... 98.8% 200,827
-------
OTHER ASSETS AND
LIABILITIES (NET)......... 1.2
Receivable for fund shares sold..... $ 178
Dividends and interest receivable... 3,227
Other assets........................ 12
Payable for fund shares redeemed.... (1)
Investment advisory fee payable..... (54)
Administration fees payable......... (13)
Shareholder servicing and
distribution fees payable.......... (34)
Dividend payable.................... (743)
Accrued trustees' fees and
expenses........................... (6)
Accrued expenses and other
liabilities........................ (76)
-------
TOTAL OTHER ASSETS AND
LIABILITIES (NET).................. 2,490
-------
NET ASSETS................. 100.0% $203,317
=======
NET ASSET VALUE, OFFERING
AND REDEMPTION PRICE PER
SHARE
PRIMARY A SHARES:
($181,006,000/16,187,625 shares
outstanding)....................... $11.18
======
INVESTOR A SHARES:
($16,168,000/1,445,898 shares
outstanding)....................... $11.18
======
INVESTOR B SHARES:
($5,540,000/495,448 shares
outstanding)....................... $11.18
======
INVESTOR C SHARES:
($603,000/53,929 shares
outstanding)....................... $11.18
======
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
47
<PAGE> 52
NATIONS FUNDS
Nations Maryland Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
(000)
- ------------------------------------------------------------------
<C> <S> <C> <C>
NET ASSETS CONSIST OF:
Undistributed net investment income........ $ --
Accumulated net realized loss on
investments sold.......................... (737)
Net unrealized appreciation of
investments............................... 11,538
Paid-in capital............................ 192,516
--------
NET ASSETS................................. $203,317
========
</TABLE>
- ---------------
* Federal Income Tax Information: Net unrealized appreciation of investment
securities was comprised of gross appreciation of $11,538,000 for federal
income tax purposes. At September 30, 1998, the aggregate cost of securities
for federal income tax purposes was $189,289,000.
+ Zero coupon security. The rate shown reflects the yield to maturity.
Nations Maryland Intermediate Municipal Bond Fund had the following insurance
concentrations greater than 10% at September 30, 1998 (as a percentage of net
assets):
FGIC 15.34%
MBIA 10.73%
SEE NOTES TO FINANCIAL STATEMENTS.
48
<PAGE> 53
NATIONS FUNDS
Nations Maryland Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- --------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 96.0%
MARYLAND -- 77.8%
Anne Arundel County, Maryland,
Consolidated Public
Improvement Revenue, GO:
$ 500 5.300% 04/01/10.............. Aa1 AA+ $ 534
500 5.250% 07/15/11.............. Aa1 AA+ 527
1,000 Baltimore, Maryland,
Consolidated Public
Improvement Revenue, GO,
Series B, (FGIC Insured),
6.500% 10/15/08.............. Aaa AAA 1,089
150 Baltimore, Maryland,
Consolidated Public
Improvement Revenue, GO, AMT,
Series B, (FGIC Insured),
6.300% 10/15/08.............. Aaa AAA 162
250 Baltimore, Maryland,
Convention Center Revenue,
(FGIC Insured),
6.150% 09/01/19.............. Aaa AAA 280
250 Baltimore, Maryland, Port
Facilities Revenue,
Consolidated Coal Sales,
Series 85, AA-/
6.500% 12/01/10.............. Aa3 A-1+ 277
Baltimore, Maryland,
Wastewater Projects Revenue,
Series A, (FGIC Insured):
500 5.000% 07/01/22.............. Aaa AAA 519
500 5.000% 07/01/24.............. Aaa AAA 519
300 Baltimore County, Maryland,
Mortgage Revenue Refunding,
(Kingswood Common III-A),
(FHA Insured),
5.750% 11/01/20.............. NR AAA 310
1,000 Baltimore County, Maryland,
Pension Funding, GO,
Refunding,
5.000% 08/01/09.............. Aaa AAA 1,077
610 Bel Air, Maryland, Industrial
Development Revenue, (May
Department Stores Company
Project),
6.375% 10/01/99.............. NR A 626
250 Cumberland, Maryland, Revenue
Refunding, GO, Series A,
(FGIC Insured),
5.250% 05/01/21.............. Aaa AAA 256
400 Howard County, Maryland,
Special Facilities Revenue,
Series A,
6.000% 02/15/21.............. Aa2 AA- 437
Maryland State, Community
Development Administration,
Department of Housing and
Community Development:
870 (Single Family Program - First
Series), (MHF/FHA Insured),
5.600% 04/01/18.............. Aa2 NR 898
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- --------------------------------------------------------------------
<C> <S> <C> <C> <C>
MARYLAND -- (CONTINUED)
$ 500 (Multifamily Development,
Auburn Manor Project), Series
A, (FNMA Collateral),
5.250% 10/01/19.............. Aaa NR $ 506
Maryland State, Community
Development Administration,
(FHA Insured):
545 4.500% 09/01/06.............. Aa2 NR 547
500 4.950% 09/01/11.............. Aa2 NR 503
500 Maryland State, Community
Development Administration,
Housing & Community
Development, Series A
5.500% 07/01/30.............. Aa2 NR 509
Maryland State, Health and
Higher Education Facilities
Authority Revenue:
110 (Anne Arundel Medical Center),
(AMBAC Insured),
5.250% 07/01/13.............. Aaa AAA 115
(College of Notre Dame), (MBIA
Insured):
510 4.600% 10/01/14.............. NR AAA 509
460 5.300% 10/01/18.............. NR AAA 485
100 (Frederick Memorial Hospital),
(FGIC Insured),
5.250% 07/01/13.............. Aaa AAA 108
200 (Greater Baltimore Medical
Center), (FGIC Insured),
5.000% 07/01/13.............. Aaa AAA 204
290 (Memorial Hospital of
Cumberland),
6.500% 07/01/10.............. A2 A 329
Project and Refunding:
150 (Doctors Community Hospital),
5.750% 07/01/13.............. Baa1 BBB- 154
200 (Peninsula Regional Medical
Center),
5.000% 07/01/08.............. A2 A 209
(The Johns Hopkins Hospital),
300 5.600% 07/01/09.............. Aa3 AA- 323
1,000 5.750% 07/01/09.............. AAA AAA 1,139
425 Maryland State, Industrial
Development Financing
Authority, (American Center
Physics Headquarters),
6.375% 01/01/12.............. NR BBB 457
1,000 Maryland State & Local
Facilities Lending, GO,
Second Series,
5.000% 08/01/06.............. Aaa AAA 1,074
500 Maryland State, Stadium
Authority, Lease Revenue,
(Ocean City Convention
Center),
5.375% 12/15/13.............. Aa AA 525
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
49
<PAGE> 54
NATIONS FUNDS
Nations Maryland Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- --------------------------------------------------------------------
<C> <S> <C> <C> <C>
MARYLAND -- (CONTINUED)
$ 115 Maryland State, Transportation
Authority, Special Obligation
Revenue, (Baltimore-f
Washington D.C. International
Airport Project), Series A,
AMT, (FGIC Insured),
6.400% 07/01/19.............. Aaa AAA $ 123
Maryland State, Transportation
Authority Revenue,
(Transportation Facilities
Project):
300 5.750% 07/01/15.............. A1 A+ 314
500 Refunded,
6.800% 07/01/16.............. AAA AAA 609
1,000 Maryland State, Health and
Higher Education,
4.600% 11/01/2026............ Aa2 AA+ 1,029
Maryland Water Quality
Financing Administration,
Revolving Loan Fund Revenue,
Series A:
250 5.400% 09/01/10.............. Aa2 AA 262
200 6.550% 09/01/14.............. Aa2 AA 221
500 Montgomery County,
Maryland,Consolidated Public
Improvement Revenue, Series
A, GO,
4.875% 05/01/06.............. Aaa AAA 532
250 Montgomery County, Maryland,
Housing Opportunities
Commission, Multi-family
Mortgage Revenue, Series A,
6.000% 07/01/14.............. Aa2 NR 266
300 Northeast, Maryland, Solid
Waste Disposal Authority
Revenue Refunding,
(Montgomery County Project),
Series A, AMT,
6.300% 07/01/16.............. A NR 324
500 Prince Georges County,
Maryland, PCR Refunding,
(Potomac Electric Power
Project),
5.750% 03/15/10.............. A1 A 567
Prince Georges County,
Maryland, Project and
Refunding Revenue,
(Dimensions Health
Corporation), GO:
175 5.375% 07/01/14.............. A NR 179
1,350 5.300% 07/01/24.............. A NR 1,366
500 Prince Georges County,
Maryland, Solid Waste
Management Authority, Revenue
Refunding, (FSA Insured),
5.200% 06/15/06.............. Aaa AAA 531
500 Prince Georges County,
Maryland, Stormwater
Management, GO,
5.500% 03/15/13.............. Aa3 AA 525
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- --------------------------------------------------------------------
<C> <S> <C> <C> <C>
MARYLAND -- (CONTINUED)
$ 1,000 University of Maryland, System
Auxiliary Facility and
Tuition Revenue, Series A,
5.125% 04/01/13.............. Aa3 AA+ $ 1,050
200 Washington County, Maryland,
Consolidated Public
Improvement Revenue, GO,
(MBIA Insured),
5.800% 01/01/15.............. Aaa AAA 218
320 Washington County, Maryland,
Sanitation District
Refunding, GO, Series F,
(FGIC Insured),
5.000% 01/01/04.............. Aaa AAA 338
-------
23,661
-------
DISTRICT OF COLUMBIA -- 9.1%
Washington, D.C., Metropolitan
Area Transportation Authority
Revenue, Refunding, (FGIC
Insured):
200 4.900% 01/01/05.............. Aaa AAA 210
350 6.000% 07/01/10.............. Aaa AAA 405
Washington Suburban Sanitation
District, MD:
1,000 5.800% 06/01/2003............ Aa1 AA 1,088
Refunding,
1,000 5.000% 06/01/04.............. Aa1 AA 1,061
-------
2,764
-------
GUAM -- 2.0%
600 Government of Guam, GO, Series
A,
5.200% 11/15/08.............. NR BBB 622
-------
PUERTO RICO -- 4.5%
Puerto Rico Electric Power
Authority, Power Revenue
Refunding,
500 Series Y, (MBIA Insured),
6.500% 07/01/06.............. Aaa AAA 586
490 Puerto Rico Housing, Bank and
Finance Agency, Single-
family Mortgage Revenue,
(Affordable Housing
Mortgage - Portfolio I), AMT,
(GNMA/FNMA/FHLMC Collateral),
6.100% 10/01/15.............. Aaa AAA 522
250 Puerto Rico Industrial Medical
& Environmental Pollution
Control Facilities, Finance
Authority Revenue, Refunding,
Higher Education, (Catholic
University Project),
Series A,
5.600% 12/01/07.............. NR BBB- 271
-------
1,379
-------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
50
<PAGE> 55
NATIONS FUNDS
Nations Maryland Municipal Bond Fund
- --------------------------------------------------------------------------------
SCHEDULE OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- --------------------------------------------------------------------
<C> <S> <C> <C> <C>
TENNESSEE -- 2.6%
$ 730 McMinn County, Tennessee,
Industrial Development Board,
PCR, (Calhoun Newsprint Co.
Project),
7.625% 03/01/16.............. Baa1 BBB $ 794
-------
TOTAL MUNICIPAL BONDS AND
NOTES
(Cost $27,567)............... 29,220
-------
</TABLE>
<TABLE>
<CAPTION>
SHARES
- ---------
<C> <S> <C> <C>
INVESTMENT COMPANIES -- 6.2%
1,520,000 AIM Tax-Exempt Fund.......................... 1,520
351,000 NUVEEN Tax-Exempt Fund....................... 351
-------
TOTAL INVESTMENT COMPANIES
(Cost $1,871)............................... 1,871
-------
TOTAL INVESTMENTS
(Cost $29,438*).................. 102.2% 31,091
-------
OTHER ASSETS AND LIABILITIES
(NET)............................ (2.2)
Cash......................................... 1
Receivable for fund shares sold.............. 93
Dividends and interest receivable............ 424
Other assets................................. 1
Payable for fund shares redeemed............. (98)
Investment advisory fee payable.............. (7)
Administration fees payable.................. (2)
Shareholder servicing and distribution fees
payable..................................... (53)
Payable for investment securities
purchased................................... (1,008)
Accrued trustees' fees and expenses.......... (1)
Accrued expenses and other liabilities....... (34)
-------
TOTAL OTHER ASSETS AND LIABILITIES (NET)..... (684)
-------
NET ASSETS........................ 100.0% $30,407
=======
</TABLE>
<TABLE>
<CAPTION>
VALUE
(000)
- -------------------------------------------------------------------
<C> <S> <C> <C>
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE
PRIMARY A SHARES:
($14,598,000/1,440,005 shares
outstanding)................................ $10.14
=======
INVESTOR A SHARES:
($1,926,000/190,003 shares outstanding)..... $10.14
=======
INVESTOR B SHARES:
($13,880,000/1,369,556 shares outstanding).. $10.14
=======
INVESTOR C SHARES:
($3,000/281 shares outstanding)............. $10.14
=======
NET ASSETS CONSIST OF:
Undistributed net investment income.......... $ 7
Accumulated net realized loss on investments
sold........................................ (9)
Net unrealized appreciation of investments... 1,653
Paid-in capital.............................. 28,756
-------
NET ASSETS................................... $30,407
=======
</TABLE>
- ---------------
* Federal Income Tax Information: Net unrealized appreciation of investment
securities was comprised of gross appreciation of $2,137,000 and gross
depreciation of $484,000 for federal income tax purposes. At September 30,
1998, the aggregate cost of securities for federal income tax purposes was
$29,438,000.
Nations Maryland Municipal Bond Fund had the following insurance concentration
greater than 10% at September 30, 1998 (as a percentage of net assets):
FGIC 13.85%
SEE NOTES TO FINANCIAL STATEMENTS.
51
<PAGE> 56
NATIONS FUNDS
Nations North Carolina Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 99.0%
NORTH CAROLINA -- 95.5%
$ 1,000 Buncombe County, North
Carolina, GO:
5.000% 03/01/03.......... Aa2 AA $ 1,050
Buncombe County, North
Carolina, Metropolitan
Sewer District, Sewer
System Revenue:
1,250 Series A,
6.750% 07/01/09.......... AAA NR 1,374
5 Unrefunded, Series B,
6.750% 07/01/16.......... A A+ 5
Charlotte, North Carolina,
Health Care Systems
Revenue, (Mecklenburg
Hospital Authority):
2,000 5.000% 01/15/17.......... Aa3 AA 2,008
2,500 5.125% 01/15/22.......... Aa3 AA 2,517
Prefunded:
760 6.375% 01/01/09.......... NR AA 834
705 6.250% 01/01/20.......... NR AA 771
Unrefunded Balance:
1,240 6.375% 01/01/09.......... Aa3 AA 1,353
425 6.250% 01/01/20.......... Aa3 AA 461
1,000 Charlotte, North Carolina,
6.750% 06/01/01.......... AAA AAA 1,032
Charlotte, North Carolina,
Public Improvement, GO,
Series A:
1,000 6.900% 10/01/05.......... AAA AAA 1,082
1,800 6.500% 02/01/07.......... AAA AAA 1,948
Charlotte, North Carolina,
Refunding, GO:
1,000 4.500% 02/01/03.......... Aaa AAA 1,030
3,055 5.000% 06/01/05.......... Aaa AAA 3,262
Charlotte, North Carolina,
Water and Sewer, GO:
1,000 6.750% 06/01/01.......... AAA AAA 1,032
1,670 5.500% 05/01/06.......... Aaa AAA 1,838
1,000 5.800% 02/01/16.......... Aaa AAA 1,110
2,340 4.750% 02/01/09.......... Aaa AAA 2,457
Cleveland County, North
Carolina, GO: (FGIC
Insured):
2,500 5.100% 06/01/01.......... Aaa AAA 2,593
2,500 5.100% 06/01/02.......... Aaa AAA 2,618
1,000 5.100% 06/01/05.......... Aaa AAA 1,060
1,000 (AMBAC Insured),
7.100% 06/01/00.......... Aaa AAA 1,056
2,000 Coastal Regional Solid
Waste Management
Authority, Solid Waste
Disposal System,
6.300% 06/01/04.......... A BBB 2,185
500 Concord, North Carolina,
GO,
6.200% 06/01/05.......... Aa A+ 546
Concord, North Carolina,
Utilities System, (MBIA
Insured):
1,000 5.200% 12/01/02.......... Aaa AAA 1,057
1,000 4.350% 12/01/05.......... Aaa AAA 1,027
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
NORTH CAROLINA -- (CONTINUED)
$ 1,000 Dayton, Ohio, Special
Facilities Revenue, (Air
Freight), Series D,
6.200% 10/01/09.......... NR BBB $ 1,096
Durham and Wake County,
North Carolina, GO:
1,000 4.500% 05/01/00.......... Aaa AAA 1,015
2,000 5.750% 02/01/06.......... Aaa AAA 2,154
1,500 5.200% 03/01/07.......... Aaa AAA 1,586
Durham and Wake County,
North Carolina, Special
Apartment District, GO:
2,300 5.000% 04/01/03.......... Aaa AAA 2,419
1,720 5.750% 04/01/03.......... Aaa AAA 1,840
Fayetteville, North
Carolina, Public Works
Commission, Revenue
Refunding, (FGIC
Insured):
2,000 4.500% 03/01/04.......... Aaa AAA 2,062
1,000 6.750% 03/01/07.......... Aaa AAA 1,063
1,150 (FSA Insured),
5.250% 03/01/07.......... Aaa AAA 1,248
2,000 Forsyth County, North
Carolina, Refunded, GO,
Series A,
4.750% 03/01/06.......... Aaa AAA 2,099
500 Gastonia, North Carolina,
Water Revenue and Street
Improvement, (FGIC
Insured),
5.200% 04/01/02.......... Aaa AAA 524
2,590 Greensboro, North
Carolina, Public
Improvement,
4.700% 04/01/15.......... Aa1 AAA 2,605
Greensboro, North
Carolina, Enterprise
System, Revenue Bond,
Series A:
1,185 6.500% 06/01/04.......... A1 AA- 1,343
1,305 5.500% 06/01/08.......... A1 AA- 1,450
2,000 Greenville, North
Carolina, Combined
Enterprises Revenue,
6.000% 09/01/10.......... A1 A+ 2,217
1,000 Guilford County, North
Carolina, GO,
5.300% 04/01/04.......... Aa1 AA+ 1,066
1,000 Haywood County, North
Carolina, Industrial
Facilities and Pollution
Control Financing
Authority, Solid Waste
Disposal, (Champion
International Corporation
Project), AMT,
5.500% 10/01/18.......... Baa1 BBB 1,014
Henderson County, North
Carolina, School and
Community College, GO:
1,000 6.500% 06/01/05.......... A1 A+ 1,083
500 6.500% 06/01/08.......... A1 A+ 541
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
52
<PAGE> 57
NATIONS FUNDS
Nations North Carolina Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
NORTH CAROLINA -- (CONTINUED)
$ 1,250 High Point, North
Carolina, GO,
6.900% 06/01/04.......... Aa3 AA $ 1,340
Iridell County, North
Carolina, GO,
1,000 4.750% 02/01/11.......... Aa3 A+ 1,031
1,095 4.750% 02/01/16.......... Aa3 A+ 1,096
1,160 Lee County, North
Carolina, GO,
6.000% 02/01/06.......... A1 A+ 1,254
750 Lower Cape Fear, North
Carolina, Water and Sewer
Authority Revenue, AMT,
5.200% 03/01/04.......... A BBB 792
3,650 Martin County, North
Carolina, Industrial
Facilities and Pollution
Control Financing
Authority Revenue,
(Wayerhaeuser Company
Project),
8.500% 06/15/99.......... A2 A 3,778
Mecklenburg County, North
Carolina, GO:
1,000 6.600% 04/01/99.......... Aaa AAA 1,017
1,000 6.750% 04/01/00.......... AAA AAA 1,046
1,000 6.200% 04/01/06.......... AAA AAA 1,079
1,000 Mecklenberg County, North
Carolina, Industrial
Facilities and Pollution
Control Finance Authority
Revenue Refunding, (Fluor
Corporation Project),
5.250% 12/01/09.......... A2 A+ 1,040
1,195 Morganton, North Carolina,
Water and Sewer, Revenue
Bonds, GO, (FGIC
Insured),
5.700% 06/01/11.......... Aaa AAA 1,315
2,220 New Hanover County, North
Carolina, GO,
5.500% 03/01/10.......... Aa3 A+ 2,419
North Carolina Housing
Finance Agency:
4,030 AMT, Singe-Family Housing
Revenue, Series A-1,
5.350% 01/01/17.......... Aa2 AA 4,103
1,950 Multi-Family Housing
Revenue, Series B, (FHA),
6.900% 07/01/24.......... Aa2 NR 2,095
Single-Family Housing
Revenue, Series R, (FHA
Mortgages):
750 6.350% 03/01/03.......... Aa2 AA 803
755 6.350% 09/01/03.......... Aa2 AA 810
925 Series Y,
6.300% 09/01/15.......... Aaa AA 999
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
NORTH CAROLINA -- (CONTINUED)
North Carolina Municipal
Power Agency, Refunding
#1, Catawba Electric
Revenue Refunding:
$ 3,000 (FGIC Insured),
5.200% 01/01/00.......... Aaa AAA $ 3,056
North Carolina Municipal
Power Agency, Refunding
#1, Catawba Electric
Revenue Refunding:
(FSA Insured):
1,000 5.500% 01/01/01.......... Aaa AAA 1,037
1,000 7.000% 01/01/06.......... AAA A- 1,061
2,000 (MBIA-IBC Insured),
7.250% 01/01/07.......... Aaa AAA 2,416
1,000 North Carolina State,
Educational Authority
Revenue, AMT, (Guaranteed
Students Loans),
5.300% 07/01/03.......... NR 1,046
North Carolina State,
Educational Facility
Financial Agency Revenue:
1,000 (Davidson College
Project), GO,
5.100% 12/01/00.......... NR AA- 1,031
1,000 (Duke University
Project), Series C,
6.625% 10/01/08.......... Aa1 AA+ 1,094
1,500 (Wake Forest University),
(GCO Insured),
5.000% 11/01/17.......... Aa3 AA 1,519
North Carolina, Medicare
Care, Community Health
Care Facility Revenue,
2,500 (Duke University Health
System), Series B, 4.500%
06/01/08................. Aa3 AA 2,551
1,000 (Halifax Regional Medical
Center), 4.600%
08/15/07................. Baa1 NR 1,004
(Stanley Memory Hospital
Project),
(AMBAC Insured):
2,000 5.250% 06/01/00.......... Aa3 AA 2,054
1,000 5.200% 10/01/00.......... Aa3 AA 1,030
1,930 5.400% 06/01/02.......... A1 A+ 2,035
1,620 5.600% 06/01/04.......... A1 A+ 1,769
2,000 5.250% 10/01/04.......... Aa3 AA 2,141
1,000 5.300% 10/01/05.......... Aa3 AA 1,075
1,500 5.200% 10/01/13.......... Aa3 A+ 1,535
2,000 5.250% 06/01/17.......... Aa3 AA 2,039
3,000 6.250% 06/01/17.......... A1 A+ 3,359
1,000 5.250% 05/01/21.......... Aa3 AA 1,017
3,000 5.500% 10/01/14.......... Aa3 AA 3,136
2,000 5.000% 02/15/05.......... Aaa AAA 2,122
1,000 5.250% 10/01/06.......... Aaa AAA 1,074
4,000 5.250% 10/01/16.......... Aaa AAA 4,142
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
53
<PAGE> 58
NATIONS FUNDS
Nations North Carolina Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
NORTH CAROLINA -- (CONTINUED)
(Novant Health Project,
Series A, Refunding),
(MBIA Insured):
$ 3,845 5.000% 10/01/07.......... Aaa AAA $ 4,112
1,830 5.100% 10/01/10.......... Aaa AAA 1,957
North Carolina State,
Capital Improvement, GO,
Series A:
1,800 4.700% 02/01/01.......... Aaa AAA 1,844
1,925 4.700% 02/01/04.......... Aaa AAA 2,013
1,500 North Carolina State, GO,
5.100% 06/01/09.......... Aaa AAA 1,618
Series A:
2,000 6.100% 03/01/01.......... Aaa AAA 2,115
4,000 5.100% 03/01/06.......... Aaa AAA 4,317
2,150 4.750% 04/01/13.......... Aaa AAA 2,209
1,625 Orange County, North
Carolina, GO,
5.500% 02/01/12.......... Aa1 AA+ 1,744
2,000 Piedmont Triad Airport
Authority, North
Carolina, Revenue, (MBIA
Insured), Refunding,
Series A,
6.800% 07/01/05.......... Aaa AAA 2,141
Pitt County, North
Carolina, Revenue
Refunding, (Pitt County
Memorial Hospital):
1,240 5.375% 12/01/10.......... Aa AA- 1,328
1,000 Series A,
6.200% 12/01/99.......... AAA AA- 1,032
1,000 Raleigh, North Carolina,
Combined Enterprise
System Revenue,
5.250% 03/01/07.......... Aa AA+ 1,088
1,910 Raleigh, North Carolina,
GO,
5.300% 06/01/16.......... Aaa AAA 2,030
2,000 Randolph County, North
Carolina, GO,
6.250% 05/01/08.......... Aa3 A+ 2,206
1,000 Robeson County, North
Carolina, Industrial
Facilities & Pollution
Control, Revenue,
6.400% 12/01/06.......... NR AA- 1,157
1,090 Rocky Mount, North
Carolina, Refunding, GO,
(MBIA Insured),
5.000% 02/01/10.......... Aaa AAA 1,168
750 Rutherford County, North
Carolina, GO, (MBIA
Insured),
6.400% 06/01/01.......... Aaa AAA 802
Union County, North
Carolina, School
District, GO:
1,000 6.500% 04/01/03.......... A1 A+ 1,077
500 5.800% 03/01/05.......... A1 A+ 537
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
NORTH CAROLINA -- (CONTINUED)
University of North
Carolina, University
Revenue Refunding,
Utilities Systems:
$ 3,500 5.200% 08/01/06.......... Aa2 AA $ 3,718
1,000 5.000% 08/01/09.......... Aa2 AA 1,044
1,600 5.000% 08/01/11.......... Aa2 AA 1,654
University of North
Carolina, Chapel Hill
Hospital, Revenue:
1,000 5.400% 02/15/01.......... Aa3 AA 1,039
1,000 5.500% 02/15/02.......... Aa3 AA 1,055
2,500 5.000% 02/15/29.......... Aa3 AA 2,504
1,000 University of North
Carolina, Charlotte,
Revenue Refunding,
Housing & Dining Systems,
Series M, (MBIA Insured),
4.800% 01/01/04.......... Aaa AAA 1,044
1,000 Wake County, North
Carolina, Refunded, GO,
4.700% 04/01/05.......... Aaa AAA 1,044
2,065 Wake County, North
Carolina, Hospital
Revenue, (MBIA Insured),
5.125% 10/01/26.......... Aaa AAA 2,154
1,000 Wake County, North
Carolina, Public
Improvement Revenue, GO,
4.600% 02/01/06.......... Aaa AAA 1,042
1,200 Wayne County, North
Carolina, GO, Revenue
Refunding, (MBIA
Insured),
4.900% 04/01/05.......... Aaa AAA 1,269
Wilmington North Carolina,
Public Improvement,
Refunded, GO, (FGIC
Insured),
Series A:
1,000 5.000% 04/01/11.......... Aaa AAA 1,060
1,000 5.000% 04/01/13.......... Aaa AAA 1,049
1,370 Series B, (FGIC Insured),
5.000% 04/01/08.......... Aaa AAA 1,475
1,000 Winston-Salem North
Carolina, Water and Sewer
Systems, Revenue,
5.500% 06/01/07.......... Aa2 AA+ 1,108
--------
194,845
--------
MISSOURI -- 1.0%
2,000 Kansas City Missouri,
Industrial Development
Authority, Industrial
Development Revenue,
(Owens-Illinois Inc.)
PJ-Conv.,
4.900% 12/31/08.......... Baa2 NR 2,055
--------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
54
<PAGE> 59
NATIONS FUNDS
Nations North Carolina Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
PUERTO RICO -- 0.9%
$ 1,000 Puerto Rico Electric Power
Authority, Power Revenue
Refunding, (MBIA
Insured), Series Y,
7.000% 07/01/07.......... Aaa AAA $ 1,220
500 Puerto Rico Industrial,
Tourist, Educational,
Medical and Environmental
Control Facilities
Financing Authority,
(Ryder Memorial Hospital
Project), Series A,
6.600% 05/01/14.......... NR BBB 546
--------
1,766
--------
TEXAS -- 1.0%
1,865 Waxahachie Texas,
Independant School
District, Refunding,
(PSF-GTD),
5.250% 08/15/07.......... Aaa Baa1 2,026
--------
WASHINGTON -- 0.6%
1,150 Washington State Public
Power Supply System,
Revenue Refunding,
(Nuclear Project Number
2), (MBIA Insured),
Series A,
5.800% 07/01/07.......... Aaa AAA 1,281
--------
TOTAL MUNICIPAL
BONDS AND NOTES
(Cost $189,301)................... 201,973
--------
</TABLE>
<TABLE>
<CAPTION>
SHARES
- ----------
<C> <S> <C> <C>
INVESTMENT COMPANY -- 0.6%
(Cost $1,141)
1,141,000 AIM Tax-Exempt Fund...................... 1,141
--------
</TABLE>
<TABLE>
<C> <S> <C> <C>
TOTAL INVESTMENTS 99.6%
(Cost $190,442*)................. 203,114
--------
</TABLE>
<TABLE>
<CAPTION>
VALUE
(000)
- ------------------------------------------------------------------
<C> <S> <C> <C>
OTHER ASSETS AND 0.4%
LIABILITIES (NET)................
Cash..................................... $ 1
Receivable for investment securities
sold.................................... 2,052
Receivable for fund shares sold.......... 175
Dividends and interest receivable........ 3,159
Other assets............................. 12
Payable for fund shares redeemed......... (802)
Investment advisory fee payable.......... (55)
Administration fees payable.............. (13)
Shareholder servicing and distribution
fees payable............................ (42)
Payable for investment securities
purchased............................... (3,532)
Accrued trustees' fees and expenses...... (6)
Accrued expenses and other liabilities... (61)
--------
TOTAL OTHER ASSETS AND
LIABILITIES (NET)....................... 888
--------
NET ASSETS........................ 100.0% $204,002
========
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE
PRIMARY A SHARES:
($186,656,000/17,219,834 shares
outstanding)............................ $10.84
========
INVESTOR A SHARES:
($10,211,000/941,949 shares
outstanding)............................ $10.84
========
INVESTOR B SHARES:
($7,016,000/647,285 shares
outstanding)............................ $10.84
========
INVESTOR C SHARES:
($119,000/10,974 shares outstanding).... $10.84
========
NET ASSETS CONSIST OF:
Undistributed net investment income...... $ 81
Accumulated net realized gain on
investments sold........................ 255
Net unrealized appreciation of
investments............................. 12,672
Paid-in capital.......................... 190,994
--------
NET ASSETS............................... $204,002
========
</TABLE>
- ---------------
* Federal Income Tax Information: Net unrealized appreciation of investment
securities was comprised of gross appreciation of $12,672,000 for federal
income tax purposes. At September 30, 1998, the aggregate cost of securities
for federal income tax purposes was $190,442,000.
Nations North Carolina Intermediate Municipal Bond Fund had the following
insurance concentration greater than 10% at September 30, 1998 (as a percentage
of net assets):
AMBAC 14.50%
MBIA 11.62%
SEE NOTES TO FINANCIAL STATEMENTS.
55
<PAGE> 60
NATIONS FUNDS
Nations North Carolina Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -----------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 98.0%
NORTH CAROLINA -- 96.3%
$ 1,050 Catawba County, North
Carolina,
4.750% 06/01/13........... Aa2 AA- $ 1,071
Charlotte, North Carolina,
Health Care Systems
Revenue Refunding,
Mecklenburg Hospital
Authority:
975 6.250% 01/01/20............ Aa AA 1,067
2,000 5.125% 01/15/22............ NR AA 2,013
Charlotte, North Carolina,
Health Care Systems
Revenue Refunding,
Mecklenburg Hospital
Authority, Carolinas
Healthcare System A,
1,600 6.000% 01/15/09............ Aa3 AA 1,830
525 6.250% 01/01/20............ Aa3 AA 569
1,000 Craven County, North
Carolina, Industrial
Facilities and Pollution
Control Financing
Authority, PCR, Refunding,
(Weyerhaeuser Company
Project),
6.350% 01/01/10........... NR A 1,083
1,340 Greensboro, North Carolina,
Resource Recovery Revenue
Improvements,
5.200% 06/01/11........... Aa3 AA- 1,442
1,000 Greensboro, North Carolina,
Combined Enterprise System
Revenue, Series A
5.000% 06/01/18........... A1 AA- 1,016
1,000 Haywood County, North
Carolina, Industrial
Facilities and Pollution
Control Financing
Authority, Solid Waste
Disposal, (Champion
International Corporation
Project), AMT,
5.500% 10/01/18........... Baa1 BBB 1,014
2,000 Martin County, North
Carolina, Industrial
Facilities and Pollution
Control Financing
Authority Revenue, Solid
Waste Disposal, AMT,
(Weyerhaeuser Company),
5.650% 12/01/23........... A2 A 2,050
2,000 Mecklenburg County, North
Carolina, Industrial
Facilities and Pollution
Control Finance Authority
Revenue Refunding, (Fluor
Corporation Project),
5.250% 12/01/09........... NR A+ 2,081
1,000 Mecklenburg County, North
Carolina, Refunding, GO,
6.000% 04/01/11........... Aaa AAA 1,164
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -----------------------------------------------------------------
<C> <S> <C> <C> <C>
NORTH CAROLINA -- (CONTINUED)
$ 1,000 Monroe, North Carolina,
Combined Enterprise System
Revenue,
6.000% 03/01/14........... A A $ 1,096
1,000 Morganton, North Carolina,
Water and Sewer Revenue,
GO, (FGIC Insured),
5.600% 06/01/10........... Aaa AAA 1,098
1,000 New Hanover County, North
Carolina, Industrial
Facilities and Pollution
Control Financing
Authority, (Solid Waste
Disposal, Occidental
Petroleum Corporation
Project), AMT,
6.500% 08/01/14........... Baa3 BBB 1,096
North Carolina Housing
Finance Agency:
830 Series U, (GNMA/FNMA COLL
Insured),
6.700% 03/01/18........... Aa2 AA 891
970 Single-family Housing
Revenue, Series W,
6.200% 09/01/09........... Aa2 AA 1,044
North Carolina Medical Care
Commission, Hospital
Revenue Refunding:
1,130 (AMBAC-TCRS Insured),
5.250% 02/15/07........... Aaa AAA 1,226
1,000 (Grace Hospital Inc.
Project), (AMBAC Insured),
5.250% 10/01/16........... Aaa AAA 1,035
1,000 (Rex Hospital Project),
6.250% 06/01/17........... A1 A+ 1,120
1,000 North Carolina Municipal
Power Agency, Refunding
#1, Catawba Electric
Revenue Refunding, (FSA
Insured),
6.200% 01/01/18........... Aaa AAA 1,100
1,000 North Carolina State, GO,
5.100% 06/01/09........... Aaa AAA 1,079
1,000 North Carolina State,
School Improvements,
Series A, GO,
4.750% 04/01/13........... Aaa AAA 1,027
1,000 North Carolina State,
University and College
Improvements, GO,
5.100% 06/01/06........... Aaa AAA 1,082
1,500 Onslow County, North
Carolina, Combined
Enterprise System Revenue,
(MBIA Insured),
5.875% 06/01/09........... Aaa AAA 1,656
1,000 Orange County, North
Carolina, GO,
5.500% 02/01/14........... Aa1 AA+ 1,066
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
56
<PAGE> 61
NATIONS FUNDS
Nations North Carolina Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -----------------------------------------------------------------
<C> <S> <C> <C> <C>
NORTH CAROLINA -- (CONTINUED)
$ 1,000 Pitt County, North
Carolina, Hospital
Revenue, (Pitt County
Memorial Hospital
Project),
5.250% 12/01/21........... Aa AA- $ 1,023
1,000 St. John's County, Florida,
Industrial Development
Authority, Industrial
Development Revenue,
Professional Golf Hall of
Fame - A, (MBIA Insured),
5.500% 3/01/17............ Aaa AAA 1,044
1,500 University North Carolina,
Chapel Hill, Hospital
Revenue,
5.000% 02/15/29........... Aa3 AA 1,502
950 Wake County, North
Carolina, Solid Waste
Management Projects
Revenue,
5.000% 02/01/05........... Aa2 AA 1,010
1,000 Wilmington, North Carolina,
Water Authority, GO,
5.700% 06/01/15........... A1 A+ 1,079
-------
37,674
-------
PUERTO RICO -- 1.7%
600 Puerto Rico Industrial,
Medical and Environmental
Agency, Pollution Control
Facilities, Finance
Authority Revenue, Higher
Education, (Catholic
University Project),
Series A,
5.600% 12/01/07........... NR BBB- 651
-------
TOTAL MUNICIPAL
BONDS AND NOTES
(Cost $35,477)............................ 38,325
-------
</TABLE>
<TABLE>
<CAPTION>
VALUE
SHARES (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
INVESTMENT COMPANY -- 1.2% (Cost $466)
466,000 AIM Tax-Exempt Fund....................... $ 466
--------
</TABLE>
<TABLE>
<C> <S> <C> <C>
TOTAL INVESTMENTS
(Cost $35,943*)..................... 99.2% 38,791
-------
OTHER ASSETS AND
LIABILITIES (NET)................... 0.8
Cash........................................ $ 1
Receivable for fund shares sold............. 61
Dividends and interest receivable........... 553
Payable for fund shares redeemed............ (125)
Investment advisory fee payable............. (10)
Administration fees payable................. (3)
Shareholder servicing and distribution fees
payable.................................... (116)
Accrued trustees' fees and expenses......... (2)
Accrued expenses and other liabilities...... (34)
-------
TOTAL OTHER ASSETS AND
LIABILITIES (NET).......................... 325
-------
NET ASSETS........................... 100.0% $39,116
=======
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE
PRIMARY A SHARES:
($11,924,000/1,166,848 shares
outstanding)............................... $10.22
=======
INVESTOR A SHARES:
($1,751,000/171,371 shares outstanding).... $10.22
=======
INVESTOR B SHARES:
($25,438,000/2,489,330 shares
outstanding)............................... $10.22
=======
INVESTOR C SHARES:
($3,000/281 shares outstanding)............ $10.22
=======
NET ASSETS CONSIST OF:
Undistributed net investment income......... $ 24
Accumulated net realized loss on investments
sold....................................... (908)
Net unrealized appreciation of
investments................................ 2,848
Paid-in capital............................. 37,152
-------
NET ASSETS.................................. $39,116
=======
</TABLE>
- ---------------
* Federal Income Tax Information: Net unrealized appreciation of investment
securities was comprised of gross appreciation of $2,848,000 for federal
income tax purposes. At September 30, 1998, the aggregate cost of securities
for federal income tax purposes was $35,943,000.
Nations North Carolina Municipal Bond Fund had the following industry
concentration greater than 10% at September 30, 1998 (as a percentage of net
assets):
Pollution Control Revenue/
Industrial Development Revenue 22.81%
Hospital Revenue 16.48%
SEE NOTES TO FINANCIAL STATEMENTS.
57
<PAGE> 62
NATIONS FUNDS
Nations South Carolina Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 98.3%
SOUTH CAROLINA -- 98.3%
Anderson County, South
Carolina, Revenue
Refunding, GO:
$ 1,100 6.400% 04/01/03........... A1 A+ $ 1,210
1,300 6.500% 04/01/04........... A1 A+ 1,424
Anderson County, South
Carolina, Refunding,
Sewer Authority, (FGIC
Insured):
1,240 5.200% 07/01/03........... Aaa AAA 1,315
1,000 5.500% 07/01/06........... Aaa AAA 1,082
1,500 5.600% 07/01/07........... Aaa AAA 1,625
1,000 5.600% 07/01/08........... Aaa AAA 1,080
Beaufort County, South
Carolina, School
District, GO, (SCSDE):
1,000 6.650% 02/01/99........... Aa1 AA 1,010
(AMBAC Insured),
2,000 6.250% 02/01/01........... Aaa AAA 2,104
2,000 6.300% 02/01/02........... Aaa AAA 2,103
1,000 6.400% 02/01/03........... Aaa AAA 1,053
Beaufort County, South
Carolina, Revenue
Refunding, GO, (MBIA
Insured):
1,000 5.600% 12/01/08........... Aaa AAA 1,040
1,415 5.650% 12/01/09........... Aaa AAA 1,482
Berkeley County, South
Carolina, Refunding and
Improvement Authority,
GO, (FGIC Insured):
1,000 5.300% 05/01/04........... Aaa AAA 1,072
1,000 5.400% 05/01/05........... Aaa AAA 1,079
1,000 5.500% 05/01/06........... Aaa AAA 1,080
Berkeley County, South
Carolina, Water and Sewer
Authority Revenue
Refunding, (MBIA
Insured):
1,000 7.000% 06/01/16........... Aaa AAA 1,103
1,000 Camden, South Carolina,
Combined Public Utilities
Revenue, Refunding and
Improvement, (MBIA
Insured),
5.500% 03/01/17.......... Aaa AAA 1,077
Charleston County, South
Carolina, Hospital
Facilities, Revenue
Refunding and
Improvement:
3,000 (Bon Secours Health
Systems Project), (FSA
Insured),
5.500% 08/15/10.......... Aaa AAA 3,190
1,000 (Medical Society Health
Project), (MBIA Insured),
6.000% 10/01/09.......... Aaa AAA 1,089
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
SOUTH CAROLINA -- (CONTINUED)
$ 1,000 Charleston County, South
Carolina, Public
Improvement Authority,
GO, (ST Aid Withhldg),
5.500% 06/01/14.......... Aa3 AA $ 1,066
Charleston County, South
Carolina, Solid Waste
User Fee Revenue, (MBIA
Insured),
1,040 5.800% 01/01/06........... Aaa AAA 1,156
1,000 5.750% 01/01/04........... A1 AA- 1,074
1,645 Cherokee County, South
Carolina, School District
No. 1, GO, (SCSDE),
5.000% 03/01/02.......... Aa1 AA 1,713
1,125 Chester County, South
Carolina, School
District, GO, (SCSDE),
6.450% 02/01/04.......... NR AA 1,189
1,500 Clemson University, South
Carolina, University &
College Improvements
Revenue (MBIA Insured),
6.550% 06/01/07.......... Aaa AAA 1,611
1,000 Columbia, South Carolina,
Auto Parking Revenue,
(AMBAC Insured),
5.750% 12/01/09.......... Aaa AAA 1,104
Columbia, South Carolina,
Waterworks and Sewer
System, Revenue
Refunding:
1,285 6.500% 02/01/02........... Aa3 AA 1,387
6,000 5.500% 02/01/09........... Aa3 AA 6,659
2,700 Capital Appreciation,
6.900% 02/01/03+......... Aa AA 2,292
Darlington County, South
Carolina, Industrial
Development Revenue,
(Nucor Corporation
Project), Series A:
1,000 5.750% 08/01/23........... A1 AA- 1,052
1,600 6.125% 06/01/25........... A2 A 1,728
Darlington County, South
Carolina, Pollution
Control Revenue:
1,500 6.600% 11/01/10........... A2 A 1,669
1,000 (MBIA Insured),
6.600% 11/01/10.......... Aaa AAA 1,117
Florence, South Carolina,
Water and Sewer Revenue
Refunding, (AMBAC
Insured):
1,000 4.700% 03/01/01........... Aaa AAA 1,023
1,250 5.150% 03/01/06........... Aaa AAA 1,330
3,000 Florence County, South
Carolina, Hospital Ser A
(MBIA Insured),
5.000% 11/01/18.......... AA3 AAA 3,011
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
58
<PAGE> 63
NATIONS FUNDS
Nations South Carolina Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
SOUTH CAROLINA -- (CONTINUED)
Georgetown County, South
Carolina, Pollution
Control and Industrial
Revenue Refunding,
$ 2,000 6.250% 06/15/05........... A3 A- $ 2,177
1,225 5.700% 10/01/21........... A3 A- 1,275
Grand Strand Water and
Sewer Authority Revenue
Refunding, (MBIA
Insured):
1,000 5.700% 06/01/00........... Aaa AAA 1,033
1,000 5.900% 06/01/01........... Aaa AAA 1,054
1,000 6.000% 06/01/02........... Aaa AAA 1,074
1,950 6.300% 06/01/05........... Aaa AAA 2,139
1,000 6.400% 06/01/07........... Aaa AAA 1,101
Greenville, South
Carolina, Hospital
Facilities Revenue
Refunding:
2,110 7.200% 05/01/06........... Aa3 AAA 2,267
1,000 Series A, (Guaranty
Agreement),
5.400% 05/01/07.......... Aa3 AA- 1,084
4,000 Series B,
5.250% 05/01/17.......... Aa3 AA- 4,084
Series C:
1,000 5.300% 05/01/04........... AA3 AA 1,063
4,000 5.400% 05/01/05........... AA3 AA 4,280
2,100 5.500% 05/01/11........... AA3 AA 2,200
1,000 Greenville, South
Carolina, Industrial
Revenue Refunding,
(Monsanto Company
Project),
7.500% 10/01/07........... A1 NR 1,062
Greenville, South
Carolina, Waterworks
Revenue, Water Utility
Improvements:
2,000 6.000% 02/01/06........... Aa1 AA 2,259
1,000 6.000% 02/01/08........... Aa1 AA 1,149
Greenwood, South Carolina,
Combined Public
Utilities, Revenue
Refunding and
Improvement, (AMBAC
Insured):
1,885 5.500% 12/01/06........... Aaa AAA 2,048
2,000 5.500% 12/01/07........... Aaa AAA 2,167
1,060 5.500% 12/01/08........... Aaa AAA 1,145
Greer, South Carolina,
Combined Public
Utilities, Revenue
Refunding and
Improvement, (AMBAC
Insured):
3,900 4.750% 09/01/11........... Aaa AAA 4,000
3,500 5.000% 09/01/17........... Aaa AAA 3,571
Horry County, South
Carolina, School
District, GO:
1,220 (SCSDE Insured),
7.000% 01/01/04.......... Aa1 AA 1,336
1,100 4.750% 07/01/10........... Aaa AAA 1,122
1,200 4.875% 07/01/11........... Aaa AAA 1,227
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
SOUTH CAROLINA -- (CONTINUED)
$ 1,275 (MBIA SCSDE Insured),
5.700% 03/01/16.......... Aaa AAA $ 1,347
1,000 Kershaw County, South
Carolina, School
District, GO, (SCSDE
Insured),
6.400% 07/01/06.......... Aa1 AA 1,090
1,725 Lancaster County, South
Carolina, School
District, GO, (MBIA
Insured),
6.500% 07/01/07.......... Aaa AAA 1,922
5,000 Lexington County, South
Carolina, Health Service
District, (FSA Insured),
5.125% 11/01/21........... Aaa AAA 5,020
2,000 Lexington, South Carolina,
Water and Sewer Authority
Revenue, (Asset Guaranty)
5.450% 04/01/19.......... NR AA 2,086
Medical University of
South Carolina, Hospital
Facilities Revenue,
Series A:
1,000 6.900% 07/01/99........... A3 A+ 1,025
Refunding:
2,000 7.000% 07/01/01........... A3 A+ 2,143
4,500 7.000% 07/01/02........... A3 A+ 4,814
3,725 7.200% 07/01/05........... A3 A+ 3,994
2,500 Myrtle Beach, South
Carolina, Sewer and Water
Improvements, Revenue
Refunding, (MBIA
Insured),
5.000% 03/01/03.......... Aaa AAA 2,621
North Charleston, South
Carolina, Refunding, GO:
1,750 5.600% 08/01/07........... A2 AA- 1,898
1,725 5.750% 08/01/08........... A2 AA- 1,884
1,000 North Charleston, South
Carolina, Sewer, Revenue
Refunding, (MBIA Insured)
6.000% 07/01/02.......... Aaa AAA 1,078
3,025 Oconee County, South
Carolina, Pollution
Control, (Duke Power Co.
Project),
5.800% 04/01/14.......... Aa3 AA- 3,223
Oconee County, South
Carolina, School
District, GO:
1,000 5.100% 01/01/13........... Aaa AAA 1,034
Refunding, Series B:
1,505 6.100% 03/01/00........... AA1 AA 1,555
Piedmont Municipal Power
Agency, South Carolina,
Electric Revenue
Refunding, (FGIC
Insured):
1,500 5.600% 01/01/00........... AAA BBB 1,538
1,850 6.850% 01/01/07........... Aaa AAA 2,003
Series A:
1,000 6.250% 01/01/13........... Aaa AAA 1,086
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
59
<PAGE> 64
NATIONS FUNDS
Nations South Carolina Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
SOUTH CAROLINA -- (CONTINUED)
$ 1,715 Unrefunded Balance
6.125% 01/01/03.......... Aaa AAA $ 1,860
Revenue Bonds, (MBIA
Insured):
9,000 Series B,
5.250% 01/01/09.......... Aaa AAA 9,657
(South Carolina Electric
Company Project):
1,600 6.000% 01/01/05........... AAA AAA 1,786
Richland County, South
Carolina, GO:
1,000 6.250% 03/01/09........... NR AA 1,055
Series B:
2,020 4.750% 03/01/03........... Aa2 AA 2,102
2,250 4.950% 03/01/05........... Aa2 AA 2,384
Richland County, South
Carolina, PCR, (Union
Camp Corporation
Project):
Series B:
1,000 6.625% 05/01/22........... A1 A- 1,088
Series C:
1,000 6.350% 11/01/07........... A1 A- 1,096
4,000 Refunding, Series C,
5.875% 11/01/02........... A2 A- 4,299
Richland County, South
Carolina, Revenue
Refunding and
Improvement:
2,040 5.900% 12/01/01........... Aa2 AA 2,177
1,500 7.125% 12/31/01........... NR A+ 1,526
2,120 Series B,
4.850% 03/01/04.......... Aa2 AA 2,226
Richland County, South
Carolina, School
District:
5,000 No. 1, GO, (State Aid
Withholding),
4.625% 03/01/22.......... Aa1 AA 4,830
No. 2, Refunding, Series
A, GO, (MBIA Insured):
1,330 4.800% 03/01/03........... Aaa AAA 1,384
1,590 4.900% 03/01/04........... Aaa AAA 1,670
1,655 5.000% 03/01/05........... Aaa AAA 1,756
1,395 Richland County, South
Carolina, Solid Waste
Disposal Facilities
Revenues, (Union Camp
Corporation Project),
Series A,
6.750% 05/01/22.......... A1 A- 1,528
1,000 Rock Hill, South Carolina,
Combined Public Utility
Systems Revenue,
6.200% 01/01/03.......... Aaa AAA 1,069
2,410 Rock Hill, South Carolina,
School District No. 3,
Refunding, Series B,
(FGIC Insured),
5.900% 02/01/02.......... Aaa AAA 2,569
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
SOUTH CAROLINA -- (CONTINUED)
South Carolina State,
Capital Improvement, GO,
Series A:
$ 6,135 3.500% 07/01/06........... Aaa AAA $ 5,896
2,000 4.250% 03/01/09........... Aaa AAA 2,015
4,000 South Carolina State,
Educational Facilities
for Nonprofit
Institutions, (Furman
University Project),
Series A, (MBIA Insured),
5.500% 10/01/26.......... Aaa AAA 4,256
South Carolina State, Jobs
Economic Development
Authority Hospital
Facilities Revenue:
6,500 5.450% 08/01/15........... Aaa AAA 6,785
1,500 (Oconee Memorial
Hospital), (Connie Lee
Insured),
6.150% 03/01/15.......... NR AAA 1,646
South Carolina State,
Housing Finance and
Development Authority:
735 Homeownership Mortgage
Purchase, Series A,
5.550% 07/01/15.......... Aa2 AA 758
Multi-family Housing
Revenue:
2,550 Rental Housing Revenue,
(Windsor Shores Project),
Series B, (FHA Insured),
5.600% 07/01/16.......... NR AA 2,604
4,595 Series A, (FNMA Insured),
6.800% 11/15/11.......... Aaa NR 4,914
5,000 (United Dominion Project),
6.500% 05/01/24.......... NR BBB+ 5,296
4,565 South Carolina State, Port
Authority, Revenue Bonds
(FSA Insured), 5.250%
07/01/13................. Aa2 A+ 4,785
South Carolina State,
Public Service Authority,
Revenue Bonds:
1,000 Series A,
5.200% 07/01/03.......... Aa2 A+ 1,059
Series A, Refunded:
1,500 5.300% 07/01/05........... Aaa AAA 1,604
3,000 6.200% 07/01/05........... Aa2 A+ 3,275
1,000 6.375% 07/01/11........... Aa2 A+ 1,090
1,000 Series B,
6.700% 07/01/02.......... Aa2 AA- 1,093
1,000 Series B, Refunded,
6.600% 07/01/01.......... AAA AA- 1,077
2,000 Series C, Refunded,
5.100% 01/01/11.......... Aaa AAA 2,073
3,000 South Carolina State
Refunding, Capital
Improvement, GO,
4.400% 04/01/04.......... Aaa AAA 3,092
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
60
<PAGE> 65
NATIONS FUNDS
Nations South Carolina Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
SOUTH CAROLINA -- (CONTINUED)
$ 1,750 South Carolina State
Revenue Bonds, GO, Series
W,
6.000% 05/01/01.......... Aaa AAA $ 1,847
1,000 South Carolina State,
University of South
Carolina, GO, Series B,
6.000% 03/01/01.......... Aaa NR 1,055
1,000 Spartanburg, South
Carolina, Health Services
District Inc. Hospital
Revenue, Series B,
Refunding,
5.125% 04/15/17.......... Aaa AAA 1,016
3,445 Spartanburg, South
Carolina, Waterworks and
Sewer System Authority,
Revenue Refunding and
Improvement, 6.200%
06/01/09................. A1 AA- 3,732
Spartanburg County, South
Carolina, GO:
1,025 5.800% 02/01/05........... Aa3 AA- 1,119
1,005 5.700% 02/01/06........... Aa3 AA- 1,090
1,000 5.700% 02/01/09........... Aa3 AA- 1,083
1,000 West Colombia, South
Carolina, Water & Sewer,
Revenue Refunding, (MBIA
Insured),
6.300% 10/01/07.......... Aaa AAA 1,103
Western Carolina Regional
Sewer Systems Authority
(AMBAC Insured):
1,000 5.600% 03/01/01........... Aaa AAA 1,044
2,500 5.000% 03/01/02........... Aaa AAA 2,599
1,000 5.800% 03/01/03........... Aaa AAA 1,072
1,000 5.900% 03/01/04........... Aaa AAA 1,073
1,000 6.750% 03/01/10........... AAA AAA 1,044
1,000 (FGIC Insured), 5.500%
03/01/10................. Aaa AAA 1,068
1,000 York County, South
Carolina, Industrial
Development Revenue,
Exempt Facility, (Hoechst
Celanese Corporation
Project), AMT,
5.700% 01/01/24.......... A2 A+ 1,032
4,000 York County, South
Carolina, PCR Refunding,
(Bowater Inc. Project),
Series B,
6.850% 04/01/01.......... Baa1 BBB 4,226
--------
TOTAL MUNICIPAL
BONDS AND NOTES
(Cost $248,279)................... 268,260
--------
</TABLE>
<TABLE>
<CAPTION>
VALUE
SHARES (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
INVESTMENT COMPANY -- 0.6% (Cost $1,637)
1,637,000 AIM Tax-Exempt Fund................ $ 1,637
--------
</TABLE>
<TABLE>
<C> <S> <C> <C>
TOTAL INVESTMENTS
(Cost $249,916*)................... 98.9% 269,897
--------
OTHER ASSETS AND
LIABILITIES (NET).................. 1.1
Receivable for fund Shares sold............ $ 473
Dividends and interest receivable.......... 3,885
Payable for fund shares redeemed........... (94)
Dividends payable.......................... (992)
Investment advisory fee payable............ (74)
Administration fees payable................ (18)
Shareholder servicing and distribution fees
payable................................... (48)
Accrued trustees' fees and expenses........ (9)
Accrued expenses and other liabilities..... (100)
--------
TOTAL OTHER ASSETS AND
LIABILITIES (NET)......................... 3,023
--------
NET ASSETS.......................... 100.0% $272,920
========
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE
PRIMARY A SHARES:
($246,841,000/22,566,832 shares
outstanding).............................. $10.94
========
INVESTOR A SHARES:
($17,291,000/1,580,847 shares
outstanding).............................. $10.94
========
INVESTOR B SHARES:
($7,097,000/648,853 shares outstanding)... $10.94
========
INVESTOR C SHARES:
($1,691,000/154,552 shares outstanding)... $10.94
========
NET ASSETS CONSIST OF:
Undistributed net investment income........ $ 24
Accumulated net realized gain on
investments sold.......................... 303
Net unrealized appreciation of
investments............................... 19,981
Paid-in capital............................ 252,612
--------
NET ASSETS................................. $272,920
========
</TABLE>
- ---------------
* Federal Income Tax Information: Net unrealized appreciation of investment
securities was comprised of gross appreciation of $19,981,000 for federal
income tax purposes. At September 30, 1998, the aggregate cost of securities
for federal income tax purposes was $249,916,000.
+ Zero coupon security. The rate shown reflects the yield to maturity.
Nations South Carolina Intermediate Municipal Bond Fund had the following
insurance concentration greater than 10% at September 30, 1998 (as a percentage
of net assets):
MBIA 17.20%
SEE NOTES TO FINANCIAL STATEMENTS.
61
<PAGE> 66
NATIONS FUNDS
Nations South Carolina Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -----------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 96.0%
SOUTH CAROLINA -- 87.6%
$ 750 Berkeley County, South
Carolina, PCR, (South
Carolina Electric and Gas
Company), 6.500%
10/01/14.................. A1 A- $ 824
525 Camden, South Carolina,
Combined Public Utilities
Revenue, Refunding and
Improvement, (MBIA
Insured), 4.900%
03/01/06.................. Aaa AAA 556
500 Charleston, South Carolina,
GO, 6.500% 06/01/11....... Aa3 NR 545
500 Charleston County, South
Carolina, Hospital
Facilities Revenue, (Bon
Secours Health Systems
Project), (FSA Insured),
5.625% 08/15/25........... Aaa AAA 524
1,000 Chester County, South
Carolina, Industrial
Development Authority,
Revenue Refunding,
(Springs Industries Inc.
Project), 7.350%
02/01/14.................. NR BBB+ 1,090
500 Clemson University, South
Carolina, Stadium
Refunding Bonds, Student
and Faculty Housing,
Series M, (MBIA Insured),
6.600% 06/01/08........... Aaa AAA 538
1,000 Columbia, South Carolina,
Waterworks and Sewer
System Revenue, 5.500%
02/01/09.................. Aa AA 1,110
Darlington County, South
Carolina, Industrial
Development Revenue:
750 (Nucor Corporation
Project), Series A, 5.750%
08/01/23.................. A1 AA- 789
500 (Sonoco Products Company
Project), 6.125%
06/01/25.................. A2 A 540
500 Darlington County, South
Carolina, PCR, (Carolina
Power and Light Company
Project), 6.600%
11/01/10.................. A2 A 556
Dorchester County, South
Carolina, School District
No. 2, GO, (FGIC Insured):
500 4.800% 07/01/05............ Aaa AAA 526
500 (Student Aid Withholding),
5.125% 02/01/13............ Aaa AAA 518
Georgetown County, South
Carolina, PCR,
(International Paper
Company Project):
500 6.250% 06/15/05............ A3 A- 544
735 5.600% 12/01/21............ A3 A- 761
575 Georgetown County, South
Carolina, School District,
GO, (MBIA Insured), 4.800%
03/01/11.................. Aaa AAA 593
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -----------------------------------------------------------------
<C> <S> <C> <C> <C>
SOUTH CAROLINA -- (CONTINUED)
$ 300 Greenville, South Carolina,
Hospital Facilities
Revenue Refunding, Series
C, 5.500% 05/01/11........ Aa3 AA $ 314
710 Greer, South Carolina,
Combined Utility Systems
Revenue, (AMBAC Insured),
5.000% 09/01/17........... Aaa AAA 724
500 Horry County, South
Carolina, Hospital
Facility Revenue, Conway
Hospital Income, (AMBAC
Insured), 5.000%
07/01/28.................. Aaa AAA 498
500 Lexington, South Carolina,
Health Services District
Inc Hospital Revenue, (FSA
Insured), 5.125%
11/01/26.................. Aaa AAA 502
500 Lexington, South Carolina,
Water and Sewer Revenue,
(Asset Guaranty), 5.500%
04/01/29.................. NR AA 526
1,000 Piedmont Municipal Power
Agency, South Carolina,
Electric Revenue Bonds,
Series B, (MBIA Insured),
5.250% 01/01/09........... Aaa AAA 1,073
1,000 Richland County, South
Carolina, School District
No. 1, GO, (SCSDE), 4.625%
03/01/22.................. Aa1 AA 966
525 Richland County, South
Carolina, Sewer System
Revenue, GO, Series A,
5.500% 03/01/17........... Aa2 AA 547
500 Richland County, South
Carolina, Waste Disposal
Facilities, Revenue
Refunding, (Union Camp
Corporation Project),
Series A, AMT, 6.750%
05/01/22.................. A1 A- 548
500 South Carolina State,
Capital Improvement,
4.400% 04/01/04........... Aaa AAA 515
1,000 South Carolina, State
Educational Facilities
Authority, (Furman
University Project),
Series A, (MBIA Insured),
5.500% 10/01/26........... Aaa AAA 1,064
500 South Carolina State, Jobs-
Economic Development
Authority, Hospital
Facilities Revenues, First
Mortgage, (Lowman
Home-Trinity Lutheran Home
Project), Pre Refunded,
6.700% 09/01/20........... NR AAA 542
500 South Carolina State, Port
Authority Revenue, (FSA
Insured), 5.300%
07/01/26.................. Aaa AAA 510
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
62
<PAGE> 67
NATIONS FUNDS
Nations South Carolina Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- -----------------------------------------------------------------
<C> <S> <C> <C> <C>
SOUTH CAROLINA -- (CONTINUED)
$ 1,000 South Carolina State,
Public Service Authority
Revenue, (AMBAC Insured),
5.125% 01/01/32........... Aaa AAA $ 1,005
500 York County, South
Carolina, GO, (AMBAC
Insured), 4.750%
06/01/07.................. Aaa AAA 515
900 York County, South
Carolina, PCR Refunding,
(Bowater Inc. Project),
Series B 6.850%
04/01/01.................. Baa1 BBB 951
-------
20,814
-------
COLORADO -- 1.6%
1,000 E-470 Public Highway
Authority, Colorado,
Revenue, Capital
Appreciation, Series B,
(MBIA Insured), 5.470%
09/01/18+................. Aaa AAA 384
-------
OHIO -- 2.3%
500 Dayton, Ohio, Special
Facilities Revenue
Refunding, (Emery Air
Freight Corporation
Project), Series F, 6.050%
10/01/09.................. NR BBB 549
-------
PUERTO RICO -- 4.5%
995 Puerto Rico, Housing, Bank
and Finance Agency,
Single-family Mortgage
Revenue (Affordable
Housing Mortgage-
Portfolio I), AMT,
(GNMA/FNMA/FHLMC
Collateral), 6.250%
04/01/29.................. Aaa AAA 1,063
-------
TOTAL MUNICIPAL
BONDS AND NOTES
(Cost $21,237)............................ 22,810
-------
</TABLE>
<TABLE>
<CAPTION>
SHARES
- ----------
<C> <S> <C> <C>
INVESTMENT COMPANY -- 3.2% (Cost $746)
746,000 AIM Tax-Exempt Fund........................... 746
-------
</TABLE>
<TABLE>
<CAPTION>
VALUE
(000)
- -------------------------------------------------------------------
<C> <S> <C> <C>
TOTAL INVESTMENTS
(Cost $21,983*)..................... 99.2% $23,556
-------
OTHER ASSETS AND
LIABILITIES (NET)................... 0.8
Receivable for fund shares sold............. $ 1
Dividends and interest receivable........... 361
Other assets................................ 1
Payable for fund shares redeemed............ (36)
Investment advisory fee payable............. (6)
Administration fees payable................. (2)
Shareholder servicing and distribution fees
payable.................................... (46)
Dividend payable............................ (57)
Accrued trustees' fees and expenses......... (1)
Accrued expenses and other liabilities...... (18)
-------
TOTAL OTHER ASSETS AND
LIABILITIES (NET).......................... 197
-------
NET ASSETS........................... 100.0% $23,753
=======
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
PRIMARY A SHARES:
($11,681,000/1,114,273 shares
outstanding)............................... $10.48
=======
INVESTOR A SHARES:
($1,107,000/105,595 shares outstanding)..... $10.48
=======
INVESTOR B SHARES:
($10,923,000/1,041,900 shares
outstanding)............................... $10.48
=======
INVESTOR C SHARES:
($42,000/4,008 shares outstanding).......... $10.48
=======
NET ASSETS CONSIST OF:
Undistributed net investment income......... $ 7
Accumulated net realized loss on investments
sold....................................... (39)
Net unrealized appreciation of
investments................................ 1,573
Paid-in capital............................. 22,212
-------
NET ASSETS.................................. $23,753
=======
</TABLE>
- ---------------
* Federal Income Tax Information: Net unrealized appreciation of investment
securities was comprised of gross appreciation of $1,573,000 for federal
income tax purposes. At September 30, 1998, the aggregate cost of securities
for federal income tax purposes was $21,983,000.
+ Zero coupon security. The rate shown reflects the yield to maturity.
Nations South Carolina Municipal Bond Fund had the following insurance
concentration greater than 10% at September 30, 1998 (as a percentage of net
assets):
MBIA 17.71%
AMBAC 11.55%
SEE NOTES TO FINANCIAL STATEMENTS.
63
<PAGE> 68
NATIONS FUNDS
Nations Tennessee Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 97.8%
TENNESSEE -- 93.8%
$1,000 Anderson County, Tennessee,
Health and Educational
Facilities Board, (Methodist
Medical Center),
5.400% 07/01/04............... A1 NR $ 1,052
Chattanooga-Hamilton County,
Tennessee, Hospital Authority
Revenue, GO, (Erlanger Medical
Center), (FSA Insured):
1,700 5.375% 10/01/04................ Aaa AAA 1,826
1,000 5.500% 10/01/07................ Aaa AAA 1,095
2,240 Dickson County, Tennessee,
(FGIC Insured),
5.000% 04/01/18............... Aaa NR 2,269
1,750 Hamilton County, Tennessee, GO,
5.000% 07/01/01............... Aa2 NR 1,812
1,145 Harpeth VY Utilities Revenue
Refunding,
5.000% 09/01/01............... A1 A 1,186
1,600 Knox County, Tennessee, Health,
Educational and Housing
Facilities Board, Hospital
Facilities Revenue, Refunding
and Improvement, (Baptist
Health System of East
Tennessee, Inc. Project),
(CONNIE LEE Insured), 5.500%
04/15/11...................... NR AAA 1,727
500 Madison County, Tennessee, GO,
Series A,
5.850% 08/01/03............... A1 NR 536
2,270 Maury County, Tennessee,
Industrial Development Board,
PCR, Multi-Modal Refunding,
(Saturn Corporation Project),
General Motors Guaranty
Agreement,
6.500% 09/01/24............... A3 A 2,497
McMinn County, Tennessee,
Industrial Development PCR,
Refunding:
1,800 (Bowater Inc. Project), 6.850%
04/01/01...................... Baa1 BBB 1,921
1,000 (Recycling Facility - Calhoun
Newsprint),
7.400% 12/01/22............... Baa1 BBB 1,117
1,000 Memphis-Shelby County,
Tennessee, Refunding,
6.750% 09/01/12............... Baa2 BBB 1,096
1,000 Memphis, Tennessee, Electric
System Revenue, Pre-refunded,
6.000% 01/01/05............... Aa AA 1,114
1,000 Memphis, Tennessee, GO,
5.000% 07/01/17............... Aa2 AA 1,016
1,500 Memphis, Tennessee, Water
Revenue,
5.900% 01/01/04............... Aa AA 1,645
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
TENNESSEE -- (CONTINUED)
Metropolitan Government,
Nashville and Davidson
Tennessee, Health and
Educational Facilities Board
Revenue, Refunding and
Improvement, (Meharry Medical
College Project), (AMBAC
Insured):
$ 505 6.000% 12/01/08................ Aaa AAA $ 581
295 6.000% 12/01/09................ Aaa AAA 342
Metropolitan Government,
Nashville and Davidson County,
Tennessee, Refunding, GO:
750 5.250% 05/15/07................ Aa AA 819
1,000 5.625% 05/15/14................ Aa AA 1,089
1,000 Metropolitan Government,
Nashville and Davidson County,
Tennessee, Health and
Educational Facilities Board,
Revenue Refunding, (FNMA
Collateral), (Multi-Family
Hsg., Welch Bend Apts.),
Series A,
5.500% 01/01/07............... NR AAA 1,060
600 Metropolitan Government,
Nashville and Davidson County,
Tennessee, Water and Sewer,
Revenue Refunding, (FGIC
Insured),
6.500% 01/01/10............... Aaa AAA 717
1,250 Rutherford County, Tennessee,
Capital Outlay Notes, GO,
Series A,
6.500% 05/01/06............... Aa3 AA- 1,454
1,345 Rutherford County, Tennessee,
Public Improvement, GO,
6.000% 04/01/06............... Aa3 AA- 1,522
Shelby County, Tennessee,
Revenue Refunding, GO:
1,000 Series A,
5.000% 03/01/03............... Aa2 AA+ 1,049
Series B:
740 6.000% 03/01/08................ NR AA+ 794
260 6.000% 03/01/08................ Aa2 AA+ 277
Shelby County, Tennessee,
Health, Educational and
Housing Facilities Board,
(MBIA Insured):
500 6.250% 08/01/09................ Aaa AAA 583
520 Series D,
5.300% 08/15/04............... Aaa AAA 559
500 Shelby County, Tennessee,
Public Improvement, GO, Series
A,
5.625% 06/01/06............... Aa2 AA+ 554
1,000 Sumner County, Tennessee, Solid
Waste Revenue, (AMBAC
Insured),
5.125% 08/01/03............... Aaa AAA 1,056
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
64
<PAGE> 69
NATIONS FUNDS
Nations Tennessee Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
TENNESSEE -- (CONTINUED)
Tennessee Housing Development
Agency, Mortgage Finance, AMT:
$ 700 5.850% 07/01/17................ Aa2 AA $ 739
GO, (Agency Insured):
1,120 4.850% 07/01/03++.............. Aa2 AA 910
1,215 4.950% 07/01/04++.............. Aa2 AA 943
Series A:
1,000 5.100% 07/01/01................ A1 A+ 1,026
200 6.300% 01/01/08................ A1 A+ 212
300 Series B,
6.550% 07/01/19............... A1 A+ 320
Tennessee State, GO,
Series A:
1,000 7.000% 03/01/03................ Aaa AA+ 1,128
1,000 5.200% 03/01/05................ Aaa AA+ 1,076
1,000 Tennessee State, Local
Development Revenue Refunding,
Series A,
5.050% 03/01/01............... A2 AA- 1,029
500 Tennessee State, School Board
Authority Higher Education
Revenue, Series A,
6.000% 05/01/05............... A1 AA 540
1,275 West Plains, Missouri,
Industrial Development
Authority,
5.250% 11/15/07............... NR BBB- 1,326
1,000 Williamson County, Tennessee,
Revenue Refunding, GO,
5.750% 03/01/03............... Aa1 NR 1,080
730 Williamson County, Tennessee,
Capital Outlay Notes,
5.700% 05/01/02............... Aa1 NR 778
Williamson County, Tennessee,
Refunding, GO:
1,540 5.000% 05/01/07................ Aa1 NR 1,649
1,000 5.500% 09/01/09................ Aa1 NR 1,114
-------
48,235
-------
PUERTO RICO -- 4.0%
600 Puerto Rico Electric Power
Authority, Power Revenue,
Series P,
6.750% 07/01/03............... Baa1 BBB+ 654
585 Puerto Rico, Housing, Bank and
Finance Agency, Single-family
Mortgage Revenue, (Affordable
Housing Mortgage - Portfolio
I), AMT, (GNMA/FNMA/FHLMC
Collateral),
5.450% 04/01/05............... Aaa AAA 618
750 Puerto Rico, Industrial,
Tourist, Educational, Medical
and Environmental Control
Facilities Financing
Authority, (Ryder Memorial
Hospital Project), Series A,
6.400% 05/01/09............... NR BBB 817
-------
2,089
-------
TOTAL MUNICIPAL
BONDS AND NOTES
(Cost $47,496)......................... 50,324
-------
</TABLE>
<TABLE>
<CAPTION>
VALUE
SHARES (000)
- -------------------------------------------------------------------
<C> <S> <C> <C>
INVESTMENT COMPANY -- 1.0% (Cost $502)
502,000 AIM Tax-Exempt Fund......................... $ 502
-------
</TABLE>
<TABLE>
<C> <S> <C> <C>
TOTAL INVESTMENTS
(Cost $47,998*)..................... 98.8% 50,826
-------
OTHER ASSETS AND
LIABILITIES (NET)................... 1.2
Receivable for investment securities sold... 72
Dividends and interest receivable........... 790
Other assets................................ 1
Payable for fund shares redeemed............ (7)
Investment advisory fee payable............. (11)
Administration fees payable................. (3)
Shareholder servicing and distribution fees
payable.................................... (20)
Dividend payable............................ (183)
Accrued trustees' fees and expenses......... (2)
Accrued expenses and other liabilities...... (38)
-------
TOTAL OTHER ASSETS AND
LIABILITIES (NET).......................... 599
-------
NET ASSETS........................... 100.0% $51,425
=======
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
PRIMARY A SHARES:
($40,072,000/3,794,556 shares
outstanding)............................... $10.56
=======
INVESTOR A SHARES:
($8,555,000/810,062 shares outstanding).... $10.56
=======
INVESTOR B SHARES:
($2,795,000/264,722 shares outstanding).... $10.56
=======
INVESTOR C SHARES:
($3,000/250 shares outstanding)............ $10.56
=======
NET ASSETS CONSIST OF:
Undistributed net investment income......... $ 4
Accumulated net realized loss
on investments sold........................ (127)
Net unrealized appreciation of
investments................................ 2,828
Paid-in capital............................. 48,720
-------
NET ASSETS.................................. $51,425
=======
</TABLE>
- ---------------
* Federal Income Tax Information: Net unrealized appreciation of investment
securities was comprised of gross appreciation of $2,828,000 for federal
income tax purposes. At September 30, 1998, the aggregate cost of securities
for federal income tax purposes was $47,998,000.
++ Zero Coupon Security. The rate shown reflects yield to maturity.
SEE NOTES TO FINANCIAL STATEMENTS.
65
<PAGE> 70
NATIONS FUNDS
Nations Tennessee Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 96.1%
TENNESSEE -- 87.9%
$ 500 Blount County, Tennessee,
Public Buildings Authority
Revenue, (FGIC Insured),
5.000% 04/01/19............ Aaa AAA $ 501
250 Chattanooga-Hamilton County,
Tennessee, Hospital
Authority Revenue, GO,
(Erlanger Medical Center),
(FSA Insured), 5.500%
10/01/07................... Aaa AAA 274
400 Dickson County Tennessee,
GO, (FGIC Insured), 5.000%
04/01/18................... Aaa NR 405
500 Humphreys County, Tennessee,
Industrial Development
Board, Solid Waste Disposal
Revenue, (du Pont (E.I.) de
Nemours & Company Project),
AMT, 6.700% 05/01/24....... Aa3 AA- 560
Knox County, Tennessee,
Health, Educational and
Housing Facilities Board,
Hospital Facilities
Revenue, Refunding and
Improvement:
400 (Baptist Health System of
East Tennessee, Inc.
Project), (CONNIE LEE
Insured), 5.500% 04/15/11.. NR AAA 432
300 (Fort Sanders Alliance
Project), (MBIA Insured),
7.250% 01/01/09............ Aaa AAA 372
200 Loudon County, Tennessee,
Industrial Development
Board, Solid Waste Disposal
Revenue, (Kimberly-Clark
Corporation Project), AMT,
6.200% 02/01/23............ Aa2 AA 216
500 Maury County, Tennessee,
Industrial Development
Board, PCR, Multi-Modal
Refunding, (Saturn
Corporation Project),
General Motors Guaranty
Agreement, 6.500%
09/01/24................... A3 A 550
250 McMinn County, Tennessee,
Industrial Development
Board, Solid Waste
Recycling Facility Revenue,
(Calhoun Newsprint
Project), AMT, 7.400%
12/01/22................... Baa1 BBB 279
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
TENNESSEE -- (CONTINUED)
$ 300 Memphis, Tennessee, Electric
System Revenue Refunding,
4.900% 01/01/11............ Aa AA $ 309
500 Memphis, Tennessee, GO,
5.000% 07/01/17............ Aa2 AA 508
Memphis-Shelby County,
Tennessee, Airport
Authority, Special
Facilities and Project
Revenue Refunding, (Federal
Express Corporation
Project), AMT:
250 6.750% 09/01/12............. Baa2 BBB 274
100 6.200% 07/01/14............. Baa2 BBB 106
350 Metropolitan Government,
Nashville and Davidson
County, Tennessee, Electric
Revenue, Series A, 5.625%
05/15/14................... Aa AA 381
Metropolitan Government,
Nashville and Davidson
County, Tennessee, Health
and Educational Facilities
Board Revenue, Refunding
and Improvement, (Meharry
Medical College Project),
(AMBAC Insured):
300 6.000% 12/01/09............. Aaa AAA 348
250 7.000% 12/01/11............. AAA AAA 296
500 6.000% 12/01/16............. Aaa AAA 583
400 Metropolitan Government,
Nashville and Davidson
County, Tennessee, GO,
5.600% 05/15/09............ Aa2 AA 441
250 Metropolitan Government,
Nashville and Davidson
County, Tennessee,
Refunding, GO, 5.250%
05/15/07................... Aa AA 273
Metropolitan Government,
Nashville and Davidson
County, Tennessee, Water
and Sewer Revenue, (FGIC
Insured):
300 6.500% 01/01/10............. Aaa AAA 359
300 5.200% 01/01/13............. Aaa AAA 322
300 Rutherford County,
Tennessee, Public
Improvement, GO, 6.000%
04/01/06................... Aa3 AA- 339
240 Shelby County, Tennessee,
School Bonds, GO,
Series A, 5.900% 03/01/15.. Aa2 AA+ 259
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
66
<PAGE> 71
NATIONS FUNDS
Nations Tennessee Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
TENNESSEE -- (CONTINUED)
$ 250 Sumner County, Tennessee,
Health, Education and
Housing Facilities Board
Revenue Refunding, (Sumner
Regional Health System
Inc.), 7.000% 11/01/03..... NR A- $ 281
300 Tennessee Housing
Development Agency, AMT
(Homeown PG-3), 5.850%
07/01/17................... Aa2 AA 317
250 Tennessee State, Local
Development Revenue, Series
A, 5.750% 03/01/11......... A2 AA- 268
-------
9,253
-------
PUERTO RICO -- 8.2%
500 Puerto Rico, Industrial,
Tourist, Educational,
Medical and Environmental
Control Facilities
Financing Authority, (Ryder
Memorial Hospital Project),
Series A, 6.600%
05/01/14................... NR BBB 545
300 Puerto Rico Public Building
Authority, Guaranteed
Public Education and Health
Facilities Revenue
Refunding, Series M, 5.500%
07/01/21................... Baa1 A 314
-------
859
-------
TOTAL MUNICIPAL
BONDS AND NOTES
(Cost $9,290)....................... 10,112
-------
</TABLE>
<TABLE>
<CAPTION>
VALUE
SHARES (000)
- -----------------------------------------------------------------
<C> <S> <C> <C>
INVESTMENT COMPANY -- 2.9% (Cost $310)
310,000 AIM Tax-Exempt Fund......................... $ 310
-------
TOTAL INVESTMENTS
(Cost $9,600*).................... 99.0% 10,422
-------
OTHER ASSETS AND
LIABILITIES (NET)................. 1.0
Receivable for fund shares sold............. 14
Dividends and interest receivable........... 176
Investment advisory fee payable............. (1)
Administration fees payable................. (1)
Shareholder servicing and distribution
fees payable............................... (22)
Dividend payable............................ (36)
Accrued trustees' fees and expenses......... (1)
Accrued expenses and other liabilities...... (20)
-------
TOTAL OTHER ASSETS AND
LIABILITIES (NET).......................... 109
-------
NET ASSETS......................... 100.0% $10,531
=======
</TABLE>
<TABLE>
<CAPTION>
VALUE
SHARES (000)
- -----------------------------------------------------------------
<C> <S> <C> <C>
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
PRIMARY A SHARES:
($5,235,000/501,057 shares outstanding)..... $10.45
=======
INVESTOR A SHARES:
($486,000/46,534 shares outstanding)........ $10.45
=======
INVESTOR B SHARES:
($4,766,000/456,091 shares outstanding)..... $10.45
=======
INVESTOR C SHARES:
($44,000/4,190 shares outstanding).......... $10.45
=======
NET ASSETS CONSIST OF:
Undistributed net investment income......... $ 14
Accumulated net realized loss on investments
sold....................................... (96)
Net unrealized appreciation of
investments................................ 822
Paid-in capital............................. 9,791
-------
NET ASSETS.................................. $10,531
=======
</TABLE>
- ---------------
* Federal Income Tax Information: Net unrealized appreciation of investment
securities was comprised of gross appreciation of $822,000 for federal income
tax purposes. At September 30, 1998, the aggregate cost of securities for
federal income tax purposes was $9,600,000.
Nations Tennessee Municipal Bond Fund had the following insurance concentration
greater than 10% at September 30, 1998 (as a percentage of net assets):
FGIC 15.07%
AMBAC 11.66%
SEE NOTES TO FINANCIAL STATEMENTS.
67
<PAGE> 72
NATIONS FUNDS
Nations Texas Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 99.5%
TEXAS -- 87.6%
$ 500 Alief, Texas, Independent
School District, GO,
(PSFG Insured),
5.000% 02/15/18.......... Aaa AAA $ 506
1,450 Alliance Airport Authority
Inc., Texas, Special
Facilities Revenue,
(American Airlines Inc.
Project), AMT,
7.000% 12/01/11.......... Baa2 BBB- 1,740
750 Amarillo, Texas, Junior
College District, GO,
(FGIC Insured),
7.600% 02/15/06.......... Aaa AAA 897
Arlington, Texas,
Independent School
District, GO:
1,750 6.750% 08/15/99........... Aa2 NR 1,801
1,000 6.750% 08/15/00........... Aa2 NR 1,056
(PSFG Insured):
3,275 6.100% 02/15/05........... Aaa NR 3,494
1,725 6.100% 02/15/05........... Aaa NR 1,849
1,060 ETM, (PSFG Insured),
5.800% 02/15/02.......... Aaa NR 1,129
1,375 Series A, (PSFG Insured),
6.375% 08/15/01.......... Aaa NR 1,476
1,000 Arlington, Texas,
Waterworks and Sewer
Revenue, Refunding and
Improvement Revenue,
(FGIC Insured),
6.100% 06/01/02.......... Aaa AAA 1,080
Austin, Texas, GO:
5,750 5.500% 09/01/04........... Aa2 AA 6,248
2,000 Public Improvement, (AMBAC
Insured),
5.900% 09/01/05.......... Aaa AAA 2,156
965 Unrefunded, Series A,
8.875% 09/01/00.......... Aa2 AA 1,058
Austin, Texas, Utility
System Revenue, (AMBAC
Insured):
4,275 6.250% 11/15/03........... Aaa AAA 4,729
3,000 6.250% 11/15/05........... Aaa AAA 3,309
2,295 Bell County, Texas, Health
Facilities Development,
Revenue Refunding, (FSA
Insured),
5.250% 12/01/11.......... Aaa AAA 2,446
985 Brazos, Texas, Higher
Education Authority Inc.,
Revenue Refunding, Senior
Lien, Series A-2, AMT,
(Guaranteed Student
Loans),
6.050% 06/01/03.......... Aaa NR 1,062
3,525 Clear Creek, Texas,
Independent School
District, GO, (PSFG
Insured),
5.375% 02/01/06.......... Aaa AAA 3,743
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
TEXAS -- (CONTINUED)
$ 5,000 Dallas-Fort Worth, Texas,
Regional Airport Revenue,
(Dallas-Fort Worth
Airport Project), Series
A, (MBIA Insured),
5.400% 11/01/03.......... Aaa AAA $ 5,355
1,500 Dallas, Texas, Civic
Center Convention
Revenue, Sr. Lien, (AMBAC
Insured),
6.375% 01/01/02.......... Aaa AAA 1,588
3,000 Dallas, Texas, GO:
5.600% 02/15/01........... Aaa AAA 3,132
Dallas, Texas, Independent
School District, (PSFG
Insured),
Unrefunded:
4,425 5.600% 08/15/05........... Aaa AAA 4,744
1,575 5.600% 08/15/05........... Aaa AAA 1,698
1,550 5.700% 08/15/06........... Aaa AAA 1,678
4,450 5.700% 08/15/06........... Aaa AAA 4,778
500 Denton, Texas, Health
Facilities Development,
Refunding, (AMBAC
Insured),
6.000% 05/01/05........... Aaa AAA 555
El Paso, Texas, GO, (FGIC
Insured):
1,395 Series C,
5.700% 08/15/03.......... Aaa AAA 1,487
3,500 Fort Worth, Texas Higher
Education Revenue,
5.000% 03/15/20.......... NR AA- 3,503
3,500 Fort Worth, Texas,
Series A, GO,
5.300% 03/01/01.......... Aa2 AA 3,633
3,000 Fort Worth, Texas, Water
and Sewer Revenue, Series
B,
5.875% 02/15/00.......... Aa2 AA 3,092
2,000 Garland, Texas, Utility
System Revenue, (AMBAC
Insured),
5.900% 03/01/02.......... Aaa AAA 2,131
2,915 Grand Prairie ,Texas,
Independent School
District, GO, (PSFG
Insured),
5.200% 02/15/24.......... Aaa AAA 2,952
2,000 Goose Creek, Texas,
Independent School
District, GO, (PSFGTD
Insured),
5.000% 02/15/09.......... Aaa AAA 2,123
2,375 Harris County, Texas, GO,
5.875% 10/01/06.......... Aa2 AA 2,676
Harris County, Texas,
Flood Control District,
GO, Series A,
1,115 5.800% 10/01/03........... Aa2 AA 1,198
3,000 6.250% 10/01/04........... Aa2 AA 3,200
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
68
<PAGE> 73
NATIONS FUNDS
Nations Texas Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
TEXAS -- (CONTINUED)
Harris County, Texas, Toll
Road, Sr. Lien, (FGIC
Insured):
$ 7,185 5.000% 08/15/16........... Aaa AAA $ 7,292
3,380 5.375% 08/15/20........... Aaa AAA 3,506
Harris County, Texas,
Health Facilities
Development Authority,
1,000 Memorial Hospital:
6.700% 06/01/00.......... NR NR 1,050
2,655 Series A,
6.000% 06/01/10.......... Aaa AAA 3,047
4,400 Harris County, Texas,
Health Facilities
Development Authority,
(FSA Insured),
5.500% 06/01/10.......... Aaa AAA 4,808
4,390 Houston, Texas, GO, Series
C,
6.000% 03/01/05.......... Aa3 AA- 4,681
Houston, Texas:
1,025 6.600% 04/01/05........... Aa3 AA- 1,096
1,305 6.600% 04/01/06........... Aa3 AA- 1,396
5,000 Houston, Texas,
Independent School
District, Refunding, GO,
(PSFG Insured),
5.400% 08/15/07.......... Aaa AAA 5,289
6,145 Houston, Texas, Water and
Sewer Systems Revenue,
Unrefunded Balance, Prior
Lien, Series B,
5.900% 12/01/03.......... A3 A 6,702
1,500 Hurst-Euless-Bedford
Independent School
District, Texas
Refunding, GO, (PSFG
Insured),
5.250% 08/15/24.......... Aaa AAA 1,528
Lewisville, Texas,
Independent School
District, Refunding, GO,
(PSFG Insured):
2,000 6.000% 08/15/00........... Aaa NR 2,085
2,000 6.100% 08/15/02........... Aaa NR 2,164
4,900 6.250% 08/15/05........... Aaa NR 5,308
12,000 Lower Colorado River
Authority, Texas, Revenue
Refunding, Junior Lien
Revenue, (AMBAC Insured),
5.300% 01/01/06.......... Aaa AAA 12,782
1,000 Lubbock, Texas,
Independent School
District, Series A, (PSFG
Insured),
6.300% 08/15/04.......... NR NR 1,048
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
TEXAS -- (CONTINUED)
Mesquite, Texas,
Independent School
District 1, Refunding,
GO, (PSFG Insured):
$ 620 5.750% 08/15/03........... NR AAA $ 659
1,380 5.750% 08/15/03........... Aaa AAA 1,462
5,000 5.300% 08/15/06........... Aaa AAA 5,332
1,070 5.000% 08/15/07........... Aaa AAA 1,143
1,080 Midway, Texas, Independent
School District,
Refunding, GO, (PSFG
Insured),
5.000% 08/01/06++........ AAA NR 785
5,000 North Central, Texas,
Health Facilities
Development Corporation,
Hospital Revenue,
(Presbyterian
Healthcare), Series B,
(MBIA Insured),
5.500% 06/01/16.......... Aaa AAA 5,483
North East, Texas,
Independent School
District, (PSFG Insured):
2,800 6.500% 02/01/06........... Aaa AAA 3,235
2,375 6.500% 02/01/07........... Aaa AAA 2,778
North Texas, Highway
Authority, Dallas, North
Texas Highway System
Revenue, (FGIC Insured):
1,000 4.750% 01/01/17........... Aaa AAA 982
2,000 4.750% 01/01/22........... Aaa AAA 1,932
1,150 North Texas, Municipal
Water District, Revenue
Refunding, (MBIA
Insured),
5.900% 09/01/99.......... Aaa AAA 1,176
Pearland, Texas,
Independent School
District, Refunding, GO,
(PSFG Insured):
1,320 4.750% 02/15/08++......... Aaa AAA 888
1,245 4.800% 02/15/09++......... Aaa AAA 795
Plano, Texas, Independent
School District, GO,
(PSFG Insured):
1,835 7.000% 02/15/05........... Aaa AAA 2,141
5,000 4.750% 02/15/07........... Aaa AAA 5,160
1,000 Plano, Texas, Waterworks
and Sewer Systems
Revenue, Refunding and
Improvement, (AMBAC
Insured),
6.800% 05/01/99.......... Aaa AAA 1,020
1,000 Port of Houston Authority
of Harris County, Texas,
Revenue Bonds, (MBIA
Insured),
6.300% 05/01/04.......... Aaa AAA 1,077
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
69
<PAGE> 74
NATIONS FUNDS
Nations Texas Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
TEXAS -- (CONTINUED)
Richardson Texas,
Refunding, GO:
$ 3,385 5.250% 02/15/08........... Aa2 AA $ 3,674
3,615 5.500% 02/15/09........... Aa2 AA 3,976
5,625 Sabine River Authority,
Texas, Water Supply
Facilities Revenue,
Refunding, (Lake Fork
Project),
6.500% 12/01/00.......... NR AA 5,956
4,650 San Antonio, Texas, GO,
5.500% 08/01/05.......... Aa AA 4,904
1,000 San Antonio, Texas
Electric & Gas Revenue,
5.500% 02/01/15.......... Aa1 AA 1,073
San Antonio, Texas, Water
Revenue:
335 Prerefunded, ETM, (FGIC
Insured),
5.900% 05/15/00.......... NR AAA 347
2,050 Unrefunded Balance, (FGIC
Insured),
5.900% 05/15/00.......... NR AAA 2,123
1,000 Tarrant County, Texas, GO,
6.750% 07/15/07.......... NR AA+ 1,054
Tarrant County, Texas,
Health Facilities
Development Corporation,
Health Systems Revenue,
Texas Health Resources
Systems, Series A, (MBIA
Insured):
3,300 5.750% 02/15/08........... Aaa AAA 3,663
3,500 5.750% 02/15/11........... Aaa AAA 3,886
Tarrant County, Texas,
Water Control and
Improvement District No.
001, Water Revenue,
Refunding and
Improvement:
2,200 5.700% 03/01/01........... A1 AA 2,300
5,000 5.900% 03/01/03........... AAA AA 5,258
2,300 Texas A&M University,
Permanent University
Fund, Revenue Refunding,
5.000% 07/01/08.......... Aaa AAA 2,457
1,275 Texas City, Texas,
Independent School
District, Refunding, GO,
(PSFG Insured),
5.000% 08/15/08.......... Aaa AAA 1,359
Texas Municipal Power
Agency, Revenue
Refunding:
1,000 (FGIC Insured),
7.000% 09/01/99........... Aaa AAA 1,033
(MBIA Insured):
6,000 5.900% 09/01/04........... Aaa AAA 6,571
15,000 5.250% 09/01/05........... Aaa AAA 15,980
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
TEXAS -- (CONTINUED)
Texas State College,
Texas, Student Loan
Authority Revenue, GO,
AMT,
$ 11,675 5.000% 10/01/00........... Aa2 AA $ 11,993
500 5.750% 08/01/11........... Aa2 AA 526
5,640 Texas State, Department of
Housing and Community
Affairs, Single Family
Revenue, AMT, Series A,
Class 1, (MBIA Insured),
5.250% 09/01/13.......... Aaa AAA 5,890
Texas State, GO,
Refunding,
Series A:
5,000 5.800% 10/01/04........... Aa2 AA 5,518
2,000 6.000% 10/01/08........... Aa2 AA 2,306
Texas State, Public
Finance Authority:
(Building Revenue):
5,000 Series B, (AMBAC Insured),
6.100% 02/01/04.......... Aaa AAA 5,534
Texas State, Public
Finance Authority:
(Building Revenue):
1,200 Series C,
6.000% 10/01/06.......... Aa2 AA 1,362
Texas State, Turnpike
Authority, Dallas North
Tollway Revenue:
President George Bush
Turnpike:
3,250 (AMBAC Insured),
5.450% 01/01/09++........ Aaa AAA 2,086
10,000 (FGIC Insured),
5.250% 01/01/23.......... Aaa AAA 10,272
590 Texas State, Revenue
Refunding, Veterans
Housing Assistance,
Series B-4, AMT,
6.200% 12/01/14.......... Aa2 AA 617
Texas State, Water
Development, GO:
1,850 5.500% 08/01/07........... Aa2 AA 2,047
5,000 5.250% 08/01/28........... Aa2 AA 5,113
1,000 Series D,
5.000% 08/01/19.......... Aa2 AA 1,003
1,400 Texas Water Resource
Finance Authority,
Revenue,
7.400% 08/15/00.......... A A 1,437
Travis County, Texas,
Limited Tax Revenue
Refunding, Series A,
(MBIA Insured):
4,000 6.000% 03/01/00........... Aaa AAA 4,131
3,250 5.500% 03/01/03........... Aaa AAA 3,473
3,500 5.600% 03/01/04........... Aaa AAA 3,744
1,500 5.750% 03/01/06........... Aaa AAA 1,604
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
70
<PAGE> 75
NATIONS FUNDS
Nations Texas Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
TEXAS -- (CONTINUED)
Trinity River Authority,
Texas:
Regional Wastewater
Systems Revenue, (AMBAC
Insured):
$ 2,750 7.000% 08/01/00........... Aaa AAA $ 2,911
3,885 5.700% 08/01/03........... Aaa AAA 4,139
7,000 University of Texas
Permanent University
Fund, (PUFG Insured),
5.250% 07/01/12........... Aa1 AAA 7,462
University of Texas
University Revenues,
Financing Systems, Series
B,
2,500 4.500% 08/15/13........... Aa1 AAA 2,473
4,210 5.000% 08/15/08........... Aa1 AAA 4,501
3,890 5.000% 08/15/07........... Aa1 AAA 4,163
--------
349,051
--------
ALASKA -- 0.9%
4,725 North Slope Boro, Alaska,
Capital Appreciation,
Series A, GO, (MBIA
Insured),
5.750% 06/30/06++......... Aaa AAA 3,432
--------
ARIZONA -- 0.5%
2,100 Coconino County, Arizona,
Unified School District
No. 001, (Flagstaff
Project), GO, (AMBAC
Insured),
5.800% 07/01/02.......... Aaa AAA 2,193
--------
CONNECTICUT -- 1.4%
5,000 Connecticut State, Series
A, GO,
5.625% 03/15/09.......... Aa3 AA- 5,433
--------
FLORIDA -- 0.3%
1,000 Florida State, Housing
Finance Agency, Multi-
family Housing Revenue,
(Andover Place Project),
Series E,
6.350% 05/01/26.......... NR BBB+ 1,086
--------
ILLINOIS -- 0.9%
2,500 Illinois State, GO
4.400% 12/01/03.......... Aa3 AA 2,562
1,100 Rosemont, Illinois, Series
B, GO,
(FGIC Insured),
6.400% 12/01/03.......... Aaa AAA 1,181
--------
3,743
--------
MAINE -- 0.5%
1,000 Bucksport, Maine, Solid
Waste Disposal Revenue,
(Champion International
Corporation Project),
6.250% 05/01/10.......... Baa1 BBB 1,061
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
MAINE -- (CONTINUED)
$ 1,000 Maine Municipal Board
Bank, Series D,
7.100% 11/01/01.......... Aa3 A+ $ 1,085
--------
2,146
--------
MICHIGAN -- 1.2%
4,600 Detroit, Michigan, Series
B, GO,
6.500% 04/01/02.......... Baa2 BBB+ 4,966
--------
MISSOURI -- 0.3%
1,135 University of Missouri,
University Revenue,
(Systems Facilities
Project),
5.750% 11/01/07.......... Aa2 AA+ 1,283
--------
NEW JERSEY -- 1.4%
5,000 New Jersey State, Series
E, GO,
6.000% 07/15/09.......... Aa1 AA+ 5,788
--------
NEW YORK -- 1.0%
3,600 New York City, New York,
Municipal Assistance
Corporation, Series J,
(GO of Corp Insured),
5.750% 07/01/03.......... Aa2 AA 3,906
--------
OHIO -- 0.3%
1,000 Ohio State Building
Authority, Correctional
Facilities Revenue,
Series A,
7.150% 08/01/99.......... Aaa NR 1,031
--------
SOUTH CAROLINA -- 0.3%
1,000 Greenville Hospital
System, South Carolina,
Hospital Facilities
Revenue, Series B,
5.250% 05/01/06.......... Aa3 AA 1,071
--------
TENNESSEE -- 0.9%
3,135 Chattanooga-Hamilton
County, Tennessee,
Hospital Authority,
Hospital Revenue,
(Erlanger Medical Center
Project), (FSA Insured),
5.500% 10/01/07.......... Aaa AAA 3,433
--------
WASHINGTON -- 2.0%
3,100 King County, Washington,
School District No. 414,
(Lake Washington
Project), GO,
5.300% 12/01/05.......... Aa2 AA 3,365
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
71
<PAGE> 76
NATIONS FUNDS
Nations Texas Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
WASHINGTON -- (CONTINUED)
Washington State, GO:
$ 2,000 Series B,
6.300% 06/01/02.......... Aa1 AA+ $ 2,133
2,425 Series 1995C,
5.450% 07/01/07.......... Aa1 AA+ 2,625
--------
8,123
--------
TOTAL MUNICIPAL
BONDS AND NOTES
(Cost $372,798)................... 396,685
--------
</TABLE>
<TABLE>
<CAPTION>
SHARES
- ----------
<C> <S> <C> <C>
INVESTMENT COMPANY -- 2.7%
(Cost $10,782)
10,782,000 AIM Tax-Exempt Fund............ 10,782
--------
TOTAL INVESTMENTS 102.2%
(Cost $383,580*).............. 407,467
--------
OTHERS ASSETS AND
LIABILITIES (NET)............. (2.2)
Cash..................................... $ 1
Receivable for investment securities
sold.................................... 2,056
Receivable for fund shares sold.......... 229
Dividends and interest receivable........ 4,396
Payable for fund shares redeemed......... (123)
Investment advisory fee payable.......... (111)
Administration fees payable.............. (26)
Shareholder servicing and distribution
fees payable............................ (14)
Dividend payable......................... (1,516)
Payable for investment securities
purchased............................... (13,649)
Accrued trustees' fees and expenses...... (10)
Accrued expenses and other liabilities... (127)
--------
TOTAL OTHER ASSETS AND
LIABILITIES (NET)....................... (8,894)
--------
NET ASSETS..................... 100.00% $398,573
========
</TABLE>
<TABLE>
<CAPTION>
VALUE
(000)
- ------------------------------------------------------------------
<C> <S> <C> <C>
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE
PRIMARY A SHARES:
($392,642,000/36,884,380 shares
outstanding)............................ $10.65
========
INVESTOR A SHARES:
($3,605,000/338,616 shares outstanding).. $10.65
========
INVESTOR B SHARES:
($2,192,000/205,912 shares outstanding).. $10.65
========
INVESTOR C SHARES:
($134,000/12,548 shares outstanding)..... $10.65
========
NET ASSETS CONSIST OF:
Undistributed net investment income...... $ 8
Accumulated net realized gain on
investments sold........................ 877
Net unrealized appreciation of
investments............................. 23,887
Paid-in capital.......................... 373,801
--------
NET ASSETS............................... $398,573
========
</TABLE>
- ---------------
* Federal Income Tax Information: Net unrealized appreciation of investment
securities was comprised of gross appreciation of $24,348,000 and gross
depreciation of $461,000 for federal income tax purposes. At September 30,
1998, the aggregate cost of securities for federal income tax purposes was
$383,580,000.
++ Zero coupon security. The rate shown reflects the yield to maturity.
Nations Texas Intermediate Municipal Bond Fund had the following insurance
concentrations greater than 10% at September 30, 1998 (as a percentage of net
assets):
PSFG 19.31%
MBIA 16.38%
AMBAC 11.66%
SEE NOTES TO FINANCIAL STATEMENTS.
72
<PAGE> 77
NATIONS FUNDS
Nations Texas Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 98.9%
TEXAS -- 82.3%
$ 500 Dallas County, Texas, GO,
5.250% 08/15/14............ Aaa AAA $ 521
750 Dallas-Fort Worth, Texas,
Regional Airport Revenue
Refunding, Series A, (MBIA
Insured),
6.000% 11/01/09............ Aaa AAA 829
500 Denison, Texas, Hospital
Authority Revenue, (Texoma
Medical Center Inc.
Project),
5.450% 08/15/02............ NR BBB+ 524
500 Galena Park, Texas,
Independent School
District, GO, (PSFG
Insured),
5.000% 08/15/21............ Aaa NR 500
500 Gulf Coast, Texas, Waste
Disposal Authority Revenue
Refunding, (Houston Light &
Power Company), Series A,
(MBIA Insured),
6.375% 04/01/12............ Aaa AAA 552
500 Harris County, Texas, Health
Facilities Development
Authority, Hospital
Revenue, Revenue Refunding,
(Texas Childrens Hospital
Project), (MBIA Insured),
6.000% 06/01/10............ Aaa AAA 574
500 Lewisville, Texas,
Independent School
District, GO, (PSFG
Insured),
7.500% 08/15/06............ Aaa AAA 614
500 Lower Neches Valley, Texas,
Industrial Development
Corporation, Revenue
Refunding, GO, (Mobil Oil
Refining Project),
5.800% 05/01/22............ Aa2 AA 544
355 North Texas, Highway
Authority, Dallas, North
Texas Highway System
Revenue, (FGIC Insured),
4.750% 01/01/17............ Aaa AAA 349
800 Pflugerville, Texas,
Independent School
District, (PSFG Insured),
5.750% 08/15/10............ Aaa AAA 907
1,000 Red River Authority, Texas,
PCR, (Hoechst Celanese
Corporation Project), AMT,
6.875% 04/01/17............ A2 A+ 1,098
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
TEXAS -- (CONTINUED)
$ 1,180 Santa Fe, Texas, Independent
School District, (PSFG
Insured),
5.000% 02/15/07++.......... Aaa NR $ 835
585 Sherman, Texas, Independent
School District, GO, (PSFG
Insured),
6.500% 02/15/20............ Aaa AAA 670
1,000 Tarrant County, Texas,
Health Facilities
Development Corporation,
Health System Revenue,
(Harris Methodist Health
System), (MBIA Insured),
6.000% 09/01/10............ Aaa AAA 1,141
500 Texas State College, Texas,
Student Loan Authority
Revenue, GO, AMT,
5.750% 08/01/11............ Aa2 AA 526
375 Texas State, Revenue
Refunding, Veterans Housing
Assistance, GO, Series C,
6.400% 12/01/09............ Aa2 AA 404
600 Texas State, Water
Development Board Revenue,
State Revolving Fund,
Senior Lien,
6.400% 07/15/08............ Aa1 AAA 659
1,000 Trinity River Authority,
Texas, PCR, (Texas
Instruments Inc. Project),
6.200% 03/01/20............ NR A 1,102
500 University of Texas,
University Revenue
Financing, Series A,
5.200% 08/15/17............ Aa1 AAA 510
1,000 Waller, Texas, Consolidated
Independent School
District, GO, (PSFG
Insured),
5.250% 02/15/21............ Aaa NR 1,022
-------
13,881
-------
COLORADO -- 6.7%
1,500 Arapahoe County, Colorado,
Capital Improvements
Highway Revenue, Capital
Appreciation, Series E,
7.200% 08/31/05++.......... AAA NR 1,131
-------
OHIO -- 6.7%
1,000 Lucas County, Ohio, Hospital
Revenue, (Flower Hospital
Project), Prerefunded,
6.125% 12/01/13............ NR NR 1,125
-------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
73
<PAGE> 78
NATIONS FUNDS
Nations Texas Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
PUERTO RICO -- 3.2%
$ 500 Puerto Rico Industrial,
Medical and Environmental
Agency, Pollution Control
Facilities, Finance
Authority Revenue, Higher
Education, (Catholic
University Project),
Series A,
5.600% 12/01/07............ NR BBB- $ 542
-------
TOTAL MUNICIPAL
BONDS AND NOTES
(Cost $15,095)...................... 16,679
-------
<CAPTION>
SHARES
------
<C> <S> <C> <C> <C>
INVESTMENT COMPANY -- 2.6% (Cost $448)
448,000 AIM Tax-Exempt Fund......................... 448
-------
TOTAL INVESTMENTS
(Cost $15,543*)............. 101.5% 17,127
-------
OTHER ASSETS AND
LIABILITIES (NET)........... (1.5)
Cash................................. $ 1
Receivable for fund shares sold...... 21
Dividends and interest receivable.... 200
Investment advisory fee payable...... (3)
Administration fees payable.......... (1)
Shareholder servicing and
distribution fees payable............ (39)
Dividend payable..................... (58)
Payable for investment securities
purchased............................ (351)
Accrued trustees' fees and
expenses............................. (1)
Accrued expenses and other
liabilities.......................... (28)
-------
TOTAL OTHER ASSETS AND
LIABILITIES (NET).................... (259)
-------
NET ASSETS.................. 100.0% $16,868
=======
</TABLE>
<TABLE>
<CAPTION>
VALUE
(000) (000)
- ------------------------------------------------------------------
<S> <C> <C> <C>
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
PRIMARY A SHARES:
($8,622,000/842,257 shares outstanding)...... $10.24
=======
INVESTOR A SHARES:
($436,000/42,554 shares outstanding)......... $10.24
=======
INVESTOR B SHARES:
($7,726,000/754,690 shares outstanding)...... $10.24
=======
INVESTOR C SHARES:
($84,000/8,165 shares outstanding)........... $10.24
=======
NET ASSETS CONSIST OF:
Undistributed net investment income.......... $ 28
Accumulated net realized loss on investments
sold......................................... (519)
Net unrealized appreciation of investments... 1,584
Paid-in capital.............................. 15,775
-------
NET ASSETS................................... $16,868
=======
</TABLE>
- ---------------
* Federal Income Tax Information: Net unrealized appreciation of investment
securities was comprised of gross appreciation of $1,584,000 for federal
income tax purposes. At September 30, 1998, the aggregate cost of securities
for federal income tax purposes was $15,543,000.
++ Zero Coupon Security. The rate shown reflects the yield to maturity.
Nations Texas Municipal Bond Fund had the following insurance concentrations
greater than 10% at September 30, 1998 (as a percentage of net assets):
PSFG 26.88%
MBIA 18.35%
SEE NOTES TO FINANCIAL STATEMENTS.
74
<PAGE> 79
NATIONS FUNDS
Nations Virginia Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 96.9%
VIRGINIA -- 92.2%
$ 2,000 Alexandria, Virginia,
Redevelopment and Housing
Authority, Multi-family
Housing Revenue Mortgage,
Buckingham Village
Apartments, Series A,
AMT,
6.050% 07/01/16.......... NR A $ 2,095
1,000 Amherst, Virginia,
Industrial Development
Authority Revenue,
5.250% 02/01/11.......... Baa2 NR 1,042
Arlington County,
Virginia, GO:
2,345 5.400% 08/01/02........... Aaa AAA 2,488
3,000 5.000% 07/15/03........... Aaa AAA 3,166
2,900 5.900% 12/01/03........... Aaa AAA 3,145
1,000 Arlington County,
Virginia, Industrial
Development Authority,
Hospital Facilities
Revenue, Series A,
6.650% 09/01/05.......... AAA NR 1,100
1,000 Arlington County,
Virginia, Industrial
Development Authority,
Facilities Revenue, (The
Natures Conservancy),
Series A,
5.450% 07/01/27.......... Aa1 NR 1,051
2,000 Arlington County,
Virginia, Industrial
Development Authority,
Resource Recovery, Series
A, (FSA Insured);
5.250% 01/01/05.......... Aaa AAA 2,131
3,455 Augusta County, Virginia,
Industrial Development
Authority Hospital
Revenue, (Augusta
Hospital Corporate
Project),
7.000% 09/01/21.......... A NR 3,827
2,000 Brunswick County,
Virginia, Industrial
Development Authority,
Correctional Facility
Lease, (MBIA Insured),
5.250% 07/01/04.......... Aaa AAA 2,141
1,000 Charlottesville-Albemarle,
Virginia, Airport
Authority, Revenue
Refunding, AMT
6.125% 12/01/09.......... NR BBB 1,072
Chesapeake, Virginia, GO:
1,000 5.700% 08/01/01........... Aa AA 1,055
1,000 (State Aid Withholding),
4.650% 08/01/11........... Aa AA 1,022
1,525 Chesapeake, Virginia,
Public Improvement, GO,
(State Aid Withholding
Insured),
5.000% 05/01/03.......... Aa3 AA 1,604
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
VIRGINIA -- (CONTINUED)
$ 6,195 Chesapeake, Virginia,
Revenue Refunding, GO,
5.125% 12/01/05.......... Aa3 AA $ 6,669
2,000 Chesapeake, Virginia,
Water and Sewer, GO,
Series A,
7.000% 12/01/09.......... Aa3 AA 2,387
Chesterfield County,
Virginia, GO:
1,095 7.100% 03/01/00........... Aaa AAA 1,134
1,000 Series A,
6.500% 01/15/01........... Aaa AAA 1,055
1,000 Series B,
6.500% 01/01/02........... Aaa AAA 1,078
2,120 Pre-refunded,
6.700% 01/01/11........... NR AAA 2,299
2,000 Chesterfield County,
Virginia, Public
Improvement, GO,
5.900% 07/15/02.......... Aaa AAA 2,153
Chesterfield County,
Virginia, Water and Sewer
Authority Revenue,
Revenue Bond:
1,000 6.200% 11/01/05........... Aa2 AA 1,102
Series A:
2,000 5.500% 11/01/00........... Aa2 AA 2,076
2,020 5.625% 11/01/01........... Aa2 AA 2,136
1,320 Covington-Allegheny
County, Virginia,
Industrial Development
Authority, PCR, (Westvaco
Corporation Project),
5.900% 03/01/05.......... A1 A 1,469
Danville, Virginia
Industrial Development
Authority, Hospital
Revenue, Danville
Regional Medical Center,
(AMBAC Insured):
1,560 5.000% 10/01/07........... Aaa AAA 1,650
1,695 5.000% 10/01/09........... Aaa AAA 1,789
1,810 5.000% 10/01/10........... Aaa AAA 1,910
1,000 Fairfax County, Virginia,
(State Aid Withholding),
4.800% 04/01/10.......... Aaa AAA 1,046
2,500 Fairfax County, Virginia,
Water Authority, Revenue
Refunding,
5.000% 04/01/21.......... Aa2 AA 2,596
2,000 Fairfax County, Virginia,
Public Improvement, GO,
Series A,
6.000% 06/01/04.......... Aaa AAA 2,223
1,000 Fairfax County, Virginia,
Industrial Development
Authority Revenue
Refunding, (Inova Health
Systems Hospital
Project),
6.100% 08/15/99.......... Aa2 AA 1,024
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
75
<PAGE> 80
NATIONS FUNDS
Nations Virginia Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
VIRGINIA -- (CONTINUED)
$ 3,135 Fairfax County, Virginia,
Water and Sewer Authority
Revenue, (AMBAC Insured),
5.100% 11/15/04.......... Aaa AAA $ 3,343
1,330 Halifax County, Virginia,
Industrial Development
Authority, Exempt
Facilities Revenue, (Old
Dominion Electric Co-op
Project), AMT,
5.900% 12/01/02.......... NR A+ 1,426
1,200 Halifax County, Virginia,
Industrial Development
Authority, Hospital
Revenue, (Halifax
Regional Hospital),
4.900% 09/01/10.......... NR A 1,217
Hampton, Virginia, Public
Improvement, GO:
1,000 6.500% 01/01/00........... Aa3 AA 1,036
2,190 Series C,
4.750% 08/01/05........... Aa3 AA 2,299
2,500 Hampton Roads Sanitation
District, Virginia, Sewer
Revenue Refunding:
4.500% 10/01/02.......... Aa AA 2,571
5,000 Hanover County, Virginia,
Industrial Development
Authority Revenue, (MBIA
Insured), (Memorial
Regional Medical Center
Project),
5.500% 08/15/25.......... Aaa AAA 5,243
Henrico County, Virginia,
Industrial Development
Authority Revenue:
2,105 Public Facilities Lease
Revenue,
7.500% 08/01/02........... Aa2 AA 2,371
3,500 Solid Waste, (Browning-
Ferris Industries Inc.
Project), (GTY AGMT),
5.300% 12/01/11.......... A3 A 3,712
1,500 Henrico County, Virginia,
Water and Sewer Authority
Revenue, Pre-refunded,
6.200% 05/01/04.......... Aa2 AAA 1,613
1,110 Henry County, Virginia,
Public Service Authority,
Water and Sewer Authority
Revenue, (FGIC Insured),
5.500% 11/15/99.......... Aaa AAA 1,136
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
VIRGINIA -- (CONTINUED)
$ 1,915 James City County,
Virginia, GO, (FGIC
Insured),
5.000% 12/15/08.......... Aaa AAA $ 2,047
1,000 Leesburg, Virginia,
Revenue Refunding,
5.500% 08/01/06.......... A1 A 1,082
Loudoun County, Virginia,
Industrial Development
Authority, Hospital
Revenue, (Loudoun
Hospital Center), (FSA
Insured):
1,500 5.500% 06/01/08........... Aaa AAA 1,627
1,000 5.600% 06/01/09........... Aaa AAA 1,086
2,000 Loudoun County, Virginia,
Sanitation Authority:
Refunding and Improvement
Authority, (State Aid
Withholding),
5.000% 10/01/02.......... Aa2 AA- 2,094
5,000 Loudoun County, Virginia,
Industrial Development
Authority, Residential
Care Facilities Revenue,
(Falcons Landing
Project), Series A,
8.750% 11/01/24.......... AAA AAA 6,427
1,000 Loudoun County, Virginia,
Sanitation Authority,
Water and Sewer Revenue,
Refunding, (FGIC
Insured),
5.800% 01/01/01.......... Aaa AAA 1,045
1,500 Louisa, Virginia,
Industrial Development
Authority, Solid Waste &
Sewer Disposal Revenue,
(Virginia Electric &
Power Company),
Series A,
5.150% 04/01/22.......... A3 A- 1,552
1,140 Lynchburg, Virginia,
Public Improvement, GO,
5.400% 05/01/17.......... Aa3 AA 1,196
Medical College Virginia
Hospital, Revenue, (MBIA
Insured);
1,965 5.000% 07/01/09........... Aaa A1 2,068
1,000 4.800% 07/01/11........... Aaa A1 1,015
5,000 Newport News, Virginia,
Public Improvement,
Series B,
5.200% 11/01/04.......... Aa2 AA 5,366
Newport News, Virginia,
Water and Sewer Authority
Revenue:
Series A:
1,020 5.500% 06/01/01........... Aa2 AA 1,068
1,095 5.600% 06/01/02........... Aa2 AA 1,165
1,000 Series B, (ST AID
WITHHOLDING),
5.100% 11/01/03........... Aa2 AA 1,061
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
76
<PAGE> 81
NATIONS FUNDS
Nations Virginia Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
VIRGINIA -- (CONTINUED)
Norfolk, Virginia, Capital
Improvement, GO, (FGIC
Insured):
$ 1,000 5.375% 06/01/05........... Aaa AAA $ 1,085
1,000 Series A,
5.900% 02/01/06........... A1 AA 1,068
2,250 Norfolk, Virginia,
Redevelopment and Housing
Authority, Educational
Facility Revenue,
(Tidewater Community
College Campus),
5.875% 11/01/15........... Aa AA 2,442
2,000 Norfolk, Virginia, Water
Revenue, (MBIA Insured),
5.700% 11/01/10........... Aaa AAA 2,209
Portsmouth, Virginia,
Public Improvement, GO,
Pre-refunded:
1,750 6.700% 08/01/03........... NR AA- 1,878
1,000 6.800% 08/01/09........... NR AA- 1,075
1,735 6.800% 08/01/06........... NR AA- 1,865
Portsmouth, Virginia,
Refunding, GO:
1,000 5.000% 08/01/02........... A3 AA- 1,044
1,000 5.250% 08/01/04........... A3 AA- 1,070
1,465 Prince William County,
Virginia, GO, Series A,
6.200% 12/01/10........... Aa2 AA 1,561
Prince William County,
Virginia, Industrial
Development Authority,
Hospital Revenue
Refunding:
1,775 (Potomoc Hospital
Corporation Project), (GO
of Hospital),
6.550% 10/01/05........... A2 NR 2,025
1,300 (Prince William Hospital
Project),
5.625% 04/01/12........... A2 NR 1,354
3,500 (Potomac Hospital
Corporation Project),
(FSA Insured),
5.000% 10/01/18........... Aaa NR 3,509
1,000 Prince William County,
Virginia, Park Authority
Revenue,
6.300% 10/15/07.......... NR A- 1,124
3,000 Prince William County,
Virginia, Service
Authority, Water and
Sewer Systems, Revenue
Refunding, (FGIC
Insured),
5.000% 07/01/21........... Aaa AAA 3,001
1,000 Richmond, Virginia,
Metropolitan Expressway
Authority, Revenue
Refunding, Series A,
(FGIC Insured),
5.650% 07/15/00........... Aaa AAA 1,036
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
VIRGINIA -- (CONTINUED)
Richmond, Virginia, Public
Improvement, GO:
Series A:
$ 2,300 6.500% 01/15/02........... A1 AA $ 2,491
1,000 6.700% 01/15/11........... AAA AA 1,085
Series B:
1,430 5.500% 07/15/09........... A1 AA 1,596
1,000 (FGIC Insured),
5.000% 01/15/21........... Aaa AAA 1,001
1,000 Pre-refunded,
6.200% 01/15/03........... AAA AA 1,074
Roanoke, Virginia, Public
Improvement, GO,
Series B:
1,000 5.800% 08/01/00........... Aa3 AA 1,039
3,295 6.000% 08/01/03........... Aa3 AA 3,516
1,115 Roanoke County, Virginia,
Industrial Development,
(Hollins College),
5.200% 03/15/17........... NR A 1,135
5,000 Southeastern Public
Service Authority,
Virginia, Series A,
(MBIA Insured),
5.100% 07/01/08........... Aaa AAA 5,335
Spotsylvania County,
Virginia, GO:
Public Improvement:
1,580 5.200% 07/15/01........... A1 A+ 1,643
2,320 5.875% 07/15/09........... A1 A+ 2,531
Refunding, (FSA Insured):
1,100 4.375% 07/15/05........... Aaa AAA 1,132
1,900 4.400% 07/15/06........... A1 AAA 1,957
2,000 4.400% 07/15/07........... A1 A+ 2,059
2,535 Staunton, Virginia,
Industrial Development
Authority, Educational
Facilities Revenue, (Mary
Baldwin College Project),
6.600% 11/01/14.......... NR NR 2,797
Suffolk, Virginia,
Refunding and
Improvement, GO:
1,110 5.400% 08/01/04........... A1 A 1,196
1,500 5.750% 08/01/08........... A1 A 1,636
2,000 University of Virginia,
Hospital Revenue Bond,
6.000% 06/01/13........... Aa3 AA 2,029
2,000 Upper Occoquan, Virginia,
Sewer Authority, Regional
Sewer Revenue, (MBIA
Insured),
6.250% 07/01/05........... AAA AAA 2,172
Virginia Beach, Virginia,
GO:
1,000 Pre-refunded,
6.950% 06/01/06........... NR NR 1,071
Refunding:
1,000 5.550% 02/01/01........... AA2 AA 1,042
2,300 5.400% 07/15/08........... AA2 AA 2,525
Series A:
1,000 6.900% 10/01/00........... AA AA 1,051
1,000 6.850% 06/01/01........... AA2 AA 1,070
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
77
<PAGE> 82
NATIONS FUNDS
Nations Virginia Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
VIRGINIA -- (CONTINUED)
$ 2,350 Virginia Biotechnology
Research Park Authority,
Lease Revenue, (Biotech
Two Project),
5.750% 09/01/05........... Aa AA $ 2,610
Virginia College Building
Authority, Educational
Facilities Revenue,
University of Richmond:
2,000 5.625% 11/01/02........... Aa2 AA- 2,093
2,000 (Equipment Leasing
Program),
5.000% 02/01/02........... 2,077
2,100 Virginia Commonwealth
Transportation Board
Revenue,
5.125% 05/15/19........... Aa2 AA 2,125
Virginia Port Authority,
Commonwealth Port Fund
Revenue, AMT, (MBIA
Insured):
1,340 5.750% 07/01/02........... Aa2 AA 1,430
1,000 5.650% 07/01/17........... Aaa AAA 1,074
1,000 Virginia State, Resource
Authority, Authority
System Revenue,
5.000% 05/01/18........... NR AA 1,003
1,175 Virginia State, Higher
Educational Institutions
Revenue, GO,
6.000% 06/01/01........... Aaa AAA 1,218
1,695 Virginia State, Housing
Development Authority,
Commonwealth Mortgage,
Series D, Sub-Series D-3,
(GO of AUTH),
6.100% 01/01/15.......... Aa1 AA+ 1,818
3,000 Virginia State, Public
Building Authority,
Series I, (School
Findings),
5.250% 08/01/10.......... Aa1 AA+ 3,268
Virginia State, Public
Building Authority,
Series A, (Correctional
Facilities):
2,000 5.800% 08/01/02........... Aa AA 2,127
Series A, (State Aid
Withholding):
2,195 5.400% 01/01/08........... Aa AA 2,344
5,000 5.000% 08/01/07........... Aa2 AA 5,354
1,480 Series B,
5.100% 01/01/05........... Aa AA 1,578
1,000 Virginia State, Public
School Authority, Series
A,
6.500% 08/01/08........... Aa2 AA 1,094
3,500 Virginia State, Refunding,
GO, Series B,
4.800% 06/01/07........... Aaa AAA 3,675
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
VIRGINIA -- (CONTINUED)
Virginia State,
Residential Authority,
Water & Sewer System
Revenue:
$ 1,000 (Hopewell Regional
Wastewater Facility),
Series A,
6.000% 10/01/15........... NR AA $ 1,093
1,020 (Suffolk Project),
5.500% 04/01/17........... NR AA 1,085
Virginia State,
Transportation Board
Authority, Contract
Revenue:
2,105 5.100% 05/15/05........... Aa2 AA 2,244
3,000 Project A,
4.900% 05/15/03........... Aa2 AA 3,137
3,150 Route 28,
6.000% 04/01/02........... Aa AA 3,380
Route 58, Series A:
500 5.125% 05/15/19........... Aa2 AA 504
5,390 5.500% 05/15/09........... Aa2 AA 5,775
2,470 Virginia State, Water and
Sewer Revenue Authority,
Revenue Bond,
5.150% 10/01/07........... NR AA 2,636
Washington County,
Virginia, Industrial
Development Authority
Hospital Facility
Revenue, (Johnston
Memorial Hospital):
1,000 5.625% 07/01/02........... A3 NR 1,041
1,000 6.000% 07/01/14........... A3 NR 1,132
1,500 Winchester, Virginia,
Industrial Development
Authority Revenue, (AMBAC
Insured),
6.150% 01/01/99........... Aaa AAA 1,511
--------
248,556
--------
ALASKA -- 1.9%
1,000 Alaska State, Student Loan
Corporation, Student Loan
Revenue,
Series A, AMT, (AMBAC
Insured),
5.250% 07/01/03........... Aaa AAA 1,046
6,500 North Slope Boro Alaska
Capitol Appreciation,
Series A,
(MBIA Insured),
4.700% 06/30/09++........ Aaa AAA 4,063
--------
5,109
--------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
78
<PAGE> 83
NATIONS FUNDS
Nations Virginia Intermediate Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
DISTRICT OF COLUMBIA -- 0.8%
Washington, D.C.,
Metropolitan Airports
Authority, Virginia
General Airport Revenue,
AMT:
$ 1,000 Series A, (MBIA Insured),
5.200% 10/01/02.......... Aaa AAA $ 1,049
1,000 Series B, (FGIC Insured),
5.75% 10/01/03........... Aaa AAA 1,082
--------
2,131
--------
MAINE -- 1.0%
2,500 Baileyville, Maine,
(Pollution Control
Project),
4.750% 06/01/05........... Baa2 NR 2,567
--------
NEW YORK -- 0.8%
2,000 New York, NY, City
Municipal Water Finance
Authority & Sewer System
Revenue -- Series D,
5.00% 06/15/04............ A2 A- 2,113
--------
OHIO -- 0.2%
500 Dayton, Ohio, Special
Facilities Revenue,
6.200% 10/01/09........... NR BBB 548
--------
TOTAL MUNICIPAL
BONDS AND NOTES
(Cost $244,977)................... 261,024
--------
</TABLE>
<TABLE>
<CAPTION>
SHARES
- ----------
<C> <S> <C> <C> <C>
INVESTMENT COMPANY -- 2.5% (Cost $6,872)
6,872,000 AIM Tax-Exempt Fund................ 6,872
--------
</TABLE>
TOTAL INVESTMENTS
(Cost $251,849*).......... 99.4% 267,896
-------
OTHER ASSETS AND
LIABILITIES (NET)......... 0.6
Cash............................... $ 1
Receivable for fund shares sold.... 398
Dividends and interest
receivable......................... 4,087
Payable for fund shares redeemed... (43)
Investment advisory fee payable.... (68)
Administration fees payable........ (17)
Shareholder servicing and
distribution fees payable.......... (83)
Dividend payable................... (956)
Payable for investment securities
purchased.......................... (1,597)
Accrued trustees' fees and
expenses........................... (16)
Accrued expenses and other
liabilities........................ (105)
----
TOTAL OTHER ASSETS AND
LIABILITIES (NET).................. 1,601
--------
NET ASSETS................ 100.0% $269,497
========
<TABLE>
<CAPTION>
VALUE
(000)
- ------------------------------------------------------------------
<S> <C> <C> <C>
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
PRIMARY A SHARES:
($203,241,000/18,307,701 shares
outstanding)............................... $11.10
========
INVESTOR A SHARES:
($54,614,000/4,919,581 shares
outstanding)............................... $11.10
========
INVESTOR B SHARES:
($10,430,000/939,535 shares
outstanding)............................... $11.10
========
INVESTOR C SHARES:
($1,212,000/109,167 shares
outstanding)............................... $11.10
========
NET ASSETS CONSIST OF:
Undistributed net investment income........ $ 145
Accumulated net realized loss
on investments sold........................ (257)
Net unrealized appreciation of
investments................................ 16,047
Paid-in capital............................ 253,562
--------
NET ASSETS................................. $269,497
========
</TABLE>
- ---------------
* Federal Income Tax Information: Net unrealized appreciation of investment
securities was comprised of gross appreciation of $16,047,0000 for federal
income tax purposes. At September 30, 1998, the aggregate cost of securities
for federal income tax purposes was $251,849,000.
Nations Virginia Intermediate Municipal Bond Fund had the following insurance
concentrations greater than 10% at September 30, 1998 (as a percentage of net
assets):
MBIA 11.10%
SEE NOTES TO FINANCIAL STATEMENTS.
79
<PAGE> 84
NATIONS FUNDS
Nations Virginia Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
MUNICIPAL BONDS AND NOTES -- 97.3%
VIRGINIA -- 94.9%
$ 1,000 Augusta County, Virginia,
Industrial Development
Authority, Hospital
Revenue Refunding,
(Augusta Hospital
Corporation), (AMBAC
Insured),
5.500% 09/01/15........... Aaa AAA $ 1,052
475 Chesapeake, Virginia,
Industrial Development
Authority, Revenue
Refunding, Port
Facilities, (Cargill Inc.
Project),
5.875% 03/01/13........... Aa3 NR 511
500 Covington-Allegheny County,
Virginia, Industrial
Development Authority,
PCR, (Westvaco Corporation
Project),
6.650% 09/01/18........... A1 A 559
1,000 Danville, Virginia,
Industrial Development
Authority, Hospital
Revenue, Danville Regional
Medical Center, (AMBAC
Insured),
5.250% 10/01/28........... Aaa AAA 1,070
500 Dayton, Ohio, Special
Facilities Revenue, Air
Freight-D-Convertible,
6.200% 10/01/09........... NR BBB 548
500 Fairfax County, Virginia,
Industrial Development
Authority, Revenue
Refunding, (Inova Health
Systems Hospital Project),
5.500% 08/15/10........... Aa2 AA 543
1,000 Fairfax County, Virginia,
Sewer, Revenue Refunding,
(AMBAC Insured),
5.500% 11/15/13........... Aaa AAA 1,066
500 Fairfax County, Virginia,
Water Authority, Revenue
Refunding,
5.000% 04/01/21........... Aa2 AA 519
800 Giles County, Virginia,
Industrial Development
Authority, Revenue, Exempt
Facilities, (Hoechst
Celanese Corporation
Project), AMT,
5.950% 12/01/25........... A2 A+ 850
400 Halifax County Virginia,
Industrial Development
Authority, Hospital
Revenue (Halifax Regional
Hospital, Inc.),
5.2500% 09/01/17.......... NR A 403
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
VIRGINIA -- (CONTINUED)
$ 400 Hampton, Virginia, Museum,
Revenue Refunding,
5.250% 01/01/09........... NR A $ 423
500 Hanover County, Virginia,
Industrial Development
Authority, (Bon Secours
Health System Projects),
(MBIA Insured),
5.500% 08/15/25........... Aaa AAA 524
500 Henrico County, Virginia,
Industrial Development
Authority Revenue, Public
Facilities Lease Revenue,
7.000% 08/01/13........... Aa2 AA 590
500 Henry County,
Virginia, GO,
5.750% 07/15/07........... A2 A 551
700 James City County,
Virginia, Public
Improvement, GO, (FGIC
Insured),
5.250% 12/15/14........... Aaa AAA 738
Loudoun County, Virginia,
Industrial Development
Authority, Hospital
Revenue, (Loudoun Hospital
Center), (FSA Insured):
765 5.600% 06/01/09........... Aaa AAA 831
500 5.800% 06/01/20........... Aaa AAA 539
840 Norfolk Virginia, Capital
Improvement, (FGIC
Insured), GO,
5.375% 06/01/05........... Aaa AAA 912
500 Peninsula Ports Authority,
Virginia, Health Care
Facilities, Revenue
Refunding, (Riverside
Health Systems Project),
Series A,
6.625% 07/01/18........... Aa2 AA- 552
500 Pittsylvania County,
Virginia, Public
Improvement, GO,
5.850% 07/01/08........... A3 A 552
1,000 Prince William County,
Virginia, Industrial
Development Authority,
Lease Revenue, (ATCC
Project),
6.000% 02/01/14........... A2 NR 1,077
500 Prince William County,
Virginia, Park Authority
Revenue,
6.875% 10/15/16........... NR A- 572
500 Richmond, Virginia, GO,
Revenue Refunding, Series
B, (FGIC State Aid
Withholding),
5.000% 01/15/21........... Aaa AAA 500
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
80
<PAGE> 85
NATIONS FUNDS
Nations Virginia Municipal Bond Fund
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
VIRGINIA -- (CONTINUED)
$ 800 Richmond, Virginia,
Metropolitan Expressway
Authority, Revenue
Refunding, Series B, (FGIC
Insured),
6.250% 07/15/22........... Aaa AAA $ 876
1,390 Rivanna, Virginia, Regional
Water and Sewer Authority,
Regional Water and Sewer
Systems, Revenue
Refunding,
6.450% 10/01/12........... Aa NR 1,514
1,000 Roanoke County, Virginia,
Water System Revenue,
Refunding, (FGIC Insured),
5.000% 07/01/21........... Aaa AAA 1,001
500 Spotsylvania County,
Virginia, Refunding, (FSA
Insured),
4.500% 07/15/08........... Aaa AAA 516
1,000 Staunton, Virginia,
Industrial Development
Authority, Educational
Facilities Revenue, (Mary
Baldwin College Project),
6.600% 11/01/14........... NR NR 1,103
500 Upper Occoquan, Virginia,
Sewer Authority, Regional
Sewer Revenue, Series A,
(MBIA Insured),
5.000% 07/01/25........... A NR 500
500 Virginia Beach, Virginia,
Public Improvement
Refunding, GO,
5.750% 11/01/08........... Aa2 AA 555
Virginia Commonwealth,
Virginia Transportation
Program Revenue, (Northern
Virginia Transportation
District PG -- B):
555 5.000% 05/15/14........... Aa2 AA 572
1,000 (Oak Grove Connector,
Series A), 5.250%
05/15/22.................. Aa2 AA 1,026
640 Virginia State, Public
School Authority Revenue,
Series A, (State Aid
Withholding),
6.125% 08/01/11........... Aa2 AA 716
820 Virginia State, Resource
Authority, Sewer Systems
Revenue, (Harrisonburg-
Rockingham),
4.700% 05/01/11........... NR AA 840
750 Virginia State, Resource
Authority, Sewer Systems
Revenue, (Hopewell
Regional Wastewater
Facility),
Series A, AMT,
6.000% 10/01/15........... NR AA 819
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT RATING VALUE
(000) MOODY'S S&P (000)
- ------------------------------------------------------------------
<C> <S> <C> <C> <C>
VIRGINIA -- (CONTINUED)
$ 500 Virginia State, Resource
Authority, Water and Sewer
Systems Revenue, (Fauquier
County Water and
Sanitation Authority),
Series C,
6.125% 05/01/14........... NR AA $ 554
800 West Point, Virginia,
Industrial Development
Authority, Solid Waste
Disposal Revenue,
(Chesapeake Corporation
Project), Series A, AMT,
6.375% 03/01/19........... Baa3 BBB 864
--------
26,938
--------
TEXAS -- 2.4%
2,420 Galena Park Texas,
Independent School
District, Capital
Appreciation, Revenue
Refunding, (PSFG Insured),
GO,
6.375% 08/15/24++......... Aaa NR 682
--------
TOTAL MUNICIPAL BONDS AND NOTES
(Cost $25,443)..................... 27,620
--------
</TABLE>
<TABLE>
<CAPTION>
SHARES
- ---------
<C> <S> <C> <C> <C>
INVESTMENT COMPANY -- 1.7% (Cost $476)
476,000 AIM Tax-Exempt Fund........................ 476
--------
</TABLE>
<TABLE>
<C> <S> <C> <C>
TOTAL INVESTMENTS (Cost $25,919*).... 99.0% 28,096
-------
OTHER ASSETS AND 1.0
LIABILITIES (NET)...................
Cash......................................... $ 1
Receivable for fund shares sold.............. 3
Dividends and interest receivable............ 431
Payable for fund shares redeemed............. (65)
Investment advisory fee payable.............. (7)
Administration fees payable.................. (2)
Shareholder servicing and distribution fees
payable..................................... (60)
Accrued trustees' fees and expenses.......... (2)
Accrued expenses and other liabilities....... (24)
-------
TOTAL OTHER ASSETS AND
LIABILITIES (NET)........................... 275
-------
NET ASSETS........................... 100.0% $28,371
------
------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
81
<PAGE> 86
NATIONS FUNDS
Nations Virginia Municipal Bond Fund
- -------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
VALUE
(000)
- --------------------------------------------------------------------
<C> <S> <C> <C>
NET ASSET VALUE, OFFERING AND
REDEMPTION PRICE PER SHARE
PRIMARY A SHARES:
($13,386,000/1,315,613 shares
outstanding)................................ $10.17
=======
INVESTOR A SHARES:
($1,290,000/126,824 shares outstanding)..... $10.17
=======
INVESTOR B SHARES:
($13,692,000/1,345,774 shares
outstanding)................................ $10.17
=======
INVESTOR C SHARES:
($3,000/285 shares outstanding)............. $10.17
=======
NET ASSETS CONSIST OF:
Undistributed net investment income.......... $ 7
Accumulated net realized loss
on investments sold......................... (617)
Net unrealized appreciation of investments... 2,177
Paid-in capital.............................. 26,804
-------
NET ASSETS................................... $28,371
======
</TABLE>
- ---------------
* Federal Income Tax Information: Net Unrealized appreciation of
investment securities was comprised of gross appreciation of $2,177,000 for
federal income tax purposes. At September 30, 1998, the aggregate cost of
securities for federal income tax purposes as $25,919,000.
++Zero coupon security. The rate shown reflects the yield to maturity.
Nations Virginia Municipal Bond Fund had the following insurance concentrations
greater than 10% at September 30, 1998 (as a percentage of net assets):
FGIC 14.19%
AMBAC 11.23%
SEE NOTES TO FINANCIAL STATEMENTS.
82
<PAGE> 87
NATIONS FUNDS
- --------------------------------------------------------------------------------
STATEMENT OF NET ASSETS (CONTINUED) SEPTEMBER 30, 1998 (UNAUDITED)
<TABLE>
<CAPTION>
COMPREHENSIVE ABBREVIATIONS LISTING FOR ALL 09/30/98 NATIONS
MUNICIPAL BOND FUNDS:
<S> <C>
AMBAC American Municipal Bond Assurance
Corporation
AMBAC-TCRS American Municipal Bond Assurance
Corporation -- Transferable Custodial
Receipts
AMT Alternative Minimum Tax
CGIC Capital Guaranty Insurance Corporation
CONNIE LEE College Construction Loan Insurance
Association
ETM Escrow to Maturity
FGIC Financial Guaranty Insurance Company
FHLMC COLL Federal Home Loan Mortgage Corporation
collateral
FHA Federal Housing Authority
FNMA COLL Federal National Mortgage Association
collateral
FSA Financial Security Assurance
GCO General Contractual Obligation
GO General Obligation
GNMA COLL Government National Mortgage Association
collateral
GTY-AGMT Guarantee Agreement
GTD STD LNS Guaranteed Student Loans
IBC Insured Bond Certificate
IDA Industrial Development Authority
LOC Letter of Credit
MHF Maryland Housing Fund
MBIA Municipal Bond Insurance Association
NR Not Rated
PCR Pollution Control Revenue
PSF-GTD Permanent School Fund Guaranteed
PUFG Permanent University Fund Guarantee
SCSDE South Carolina School District Enhancement
SCH BD GTY School Bond Guarantee
ST AID
WITHHLDG State Aid Withholding
ST GTD State Guaranteed
VA Veterans Association
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
83
<PAGE> 88
NATIONS FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS (UNAUDITED)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1998
In thousands
<TABLE>
<CAPTION>
FLORIDA
SHORT-TERM INTERMEDIATE INTERMEDIATE
MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL
INCOME BOND INCOME BOND
-------------------------------------------------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME:
Interest.................................................... $2,541 $22,724 $15,659 $5,770
Dividends................................................... 38 218 56 62
------ ------- ------- ------
Total investment income................................. 2,579 22,942 15,715 5,832
------ ------- ------- ------
EXPENSES:
Investment advisory fee..................................... 284 2,254 1,768 560
Administration fee.......................................... 56 451 295 112
Transfer agent fees......................................... 41 206 126 54
Custodian fees.............................................. 7 33 25 12
Legal and audit fees........................................ 9 31 25 13
Trustees' fees and expenses................................. 1 11 7 3
Amortization of organization costs.......................... 5 -- -- --
Interest expense............................................ 3 -- -- --*
Registration and filing fees................................ 19 33 78 9
Other....................................................... 9 37 29 16
------ ------- ------- ------
Subtotal................................................ 434 3,056 2,353 779
Shareholder servicing and distribution fees
Investor A Shares......................................... 30 12 26 14
Investor B Shares......................................... 65 11 77 20
Investor C Shares......................................... 22 9 11 2
Fees waived by investment adviser, administrator and/or
distributor............................................... (267) (812) (605) (227)
------ ------- ------- ------
Total expenses.......................................... 284 2,276 1,862 588
------ ------- ------- ------
NET INVESTMENT INCOME....................................... 2,295 20,666 13,853 5,244
------ ------- ------- ------
NET REALIZED AND UNREALIZED GAIN/(LOSS) ON INVESTMENTS:
Net realized gain on investments............................ 50 2,103 1,238 100
Net change in unrealized appreciation of investments........ 511 12,729 12,102 3,036
------ ------- ------- ------
Net realized and unrealized gain/(loss) on investments...... 561 14,832 13,340 3,136
------ ------- ------- ------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $2,856 $35,498 $27,193 $8,380
====== ======= ======= ======
</TABLE>
- ---------------
* Amount represents less than $500.
SEE NOTES TO FINANCIAL STATEMENTS.
84
<PAGE> 89
NATIONS FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS (CONTINUED) (UNAUDITED)
<TABLE>
<CAPTION>
GEORGIA MARYLAND NORTH CAROLINA
FLORIDA INTERMEDIATE GEORGIA INTERMEDIATE MARYLAND INTERMEDIATE
MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL
BOND BOND BOND BOND BOND BOND
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$3,624 $3,747 $501 $3,971 $ 652 $5,039
45 1 11 43 11 48
------ ------ ---- ------ ------ ------
3,669 3,748 512 4,014 663 5,087
------ ------ ---- ------ ------ ------
408 371 59 396 80 496
68 74 10 79 13 99
28 36 6 34 8 48
8 10 5 9 5 11
10 11 5 13 6 12
1 2 --* 2 --* 2
-- -- -- -- --* --
--* --* --* -- --* --*
15 5 4 32 6 5
10 12 5 15 9 11
------ ------ ---- ------ ------ ------
548 521 94 580 127 684
72 14 1 20 2 12
86 37 51 26 61 34
--* 5 --* 2 --* 1
(168) (162) (44) (193) (57) (197)
------ ------ ---- ------ ------ ------
538 415 102 435 133 534
------ ------ ---- ------ ------ ------
3,131 3,333 410 3,579 530 4,553
------ ------ ---- ------ ------ ------
195 473 21 212 28 266
3,650 2,170 485 2,775 573 2,687
------ ------ ---- ------ ------ ------
3,845 2,643 506 2,987 601 2,953
------ ------ ---- ------ ------ ------
$6,976 $5,976 $916 $6,566 $1,131 $7,506
====== ====== ==== ====== ====== ======
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
85
<PAGE> 90
NATIONS FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS (CONTINUED) (UNAUDITED)
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1998
In thousands
<TABLE>
<CAPTION>
SOUTH CAROLINA
NORTH CAROLINA INTERMEDIATE SOUTH CAROLINA
MUNICIPAL MUNICIPAL MUNICIPAL
BOND BOND BOND
--------------------------------------------------
<S> <C> <C> <C>
INVESTMENT INCOME:
Interest.................................................... $ 891 $ 7,150 $576
Dividends................................................... 20 4 12
------ ------- ----
Total investment income................................. 911 7,154 588
------ ------- ----
EXPENSES:
Investment advisory fee..................................... 105 680 67
Administration fee.......................................... 18 136 11
Transfer agent fees......................................... 10 66 7
Custodian fees.............................................. 5 14 5
Legal and audit fees........................................ 7 16 6
Trustees' fees and expenses................................. --* 3 --*
Amortization of organization costs.......................... --* -- --*
Interest expense............................................ -- 1 --
Registration and filing fees................................ 5 5 4
Other....................................................... 7 18 5
------ ------- ----
Subtotal................................................ 157 939 105
Shareholder servicing and distribution fees
Investor A Shares......................................... 1 19 1
Investor B Shares......................................... 128 35 53
Investor C Shares......................................... --* 9 --*
Fees waived and/or expenses reimbursed by investment
adviser, administrator and/or distributor................. (71) (271) (46)
------ ------- ----
Total expenses.......................................... 215 731 113
------ ------- ----
NET INVESTMENT INCOME....................................... 696 6,423 475
------ ------- ----
NET REALIZED AND UNREALIZED GAIN/(LOSS) ON INVESTMENTS:
Net realized gain on investments............................ 11 320 --
Net change in unrealized appreciation of investments........ 747 3,581 505
------ ------- ----
Net realized and unrealized gain on investments............. 758 3,901 505
------ ------- ----
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS........................................... $1,454 $10,324 $980
====== ======= ====
</TABLE>
- ---------------
* Amount represents less than $500.
SEE NOTES TO FINANCIAL STATEMENTS.
86
<PAGE> 91
NATIONS FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS (CONTINUED) (UNAUDITED)
<TABLE>
<CAPTION>
TENNESSEE TEXAS VIRGINIA
INTERMEDIATE TENNESSEE INTERMEDIATE TEXAS INTERMEDIATE VIRGINIA
MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL
BOND BOND BOND BOND BOND BOND
------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$1,259 $282 $10,153 $441 $6,297 $ 692
12 4 64 11 111 21
------ ---- ------- ---- ------ ------
1,271 286 10,217 452 6,408 713
------ ---- ------- ---- ------ ------
126 33 980 52 627 82
25 6 196 9 126 14
15 5 92 6 58 8
6 4 18 4 12 5
7 5 16 6 20 6
1 --* 4 --* 3 --*
--* --* -- 1 -- --*
-- 1 1 --* -- --
4 4 5 4 13 5
8 5 17 6 27 6
------ ---- ------- ---- ------ ------
192 63 1,329 88 886 126
10 1 4 1 69 2
14 24 11 41 49 67
--* --* 1 --* 6 --*
(70) (33) (352) (42) (284) (55)
------ ---- ------- ---- ------ ------
146 55 993 88 726 140
------ ---- ------- ---- ------ ------
1,125 231 9,224 364 5,682 573
------ ---- ------- ---- ------ ------
58 54 987 43 6 --
735 182 4,458 295 4,244 628
------ ---- ------- ---- ------ ------
793 236 5,445 338 4,250 628
------ ---- ------- ---- ------ ------
$1,918 $467 $14,669 $702 $9,932 $1,201
====== ==== ======= ==== ====== ======
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
87
<PAGE> 92
NATIONS FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
In thousands
<TABLE>
<CAPTION>
SHORT-TERM INTERMEDIATE
MUNICIPAL INCOME MUNICIPAL BOND
-------------------------------- --------------------------------
SIX MONTHS ENDED SIX MONTHS ENDED
09/30/98 YEAR ENDED 09/30/98 YEAR ENDED
(UNAUDITED) 03/31/98 (UNAUDITED) 03/31/98
----------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net investment income................................. $ 2,295 $ 4,087 $ 20,666 $ 30,021
Net realized gain/(loss) on investments............... 50 274 2,103 6,161
Net change in unrealized appreciation/(depreciation)
of investments...................................... 511 564 12,729 9,021
-------- -------- -------- --------
Net increase in net assets resulting from
operations.......................................... 2,856 4,925 35,498 45,203
Distributions to shareholders from net investment
income:
Primary A Shares.................................... (1,502) (2,665) (20,387) (29,730)
Investor A Shares................................... (464) (959) (200) (178)
Investor B Shares................................... (244) (446) (42) (72)
Investor C Shares................................... (85) (26) (36) (41)
Distributions to shareholders from net realized gains
on investments:
Primary A Shares.................................... -- -- (2,199) (3,319)
Investor A Shares................................... -- -- (16) (14)
Investor B Shares................................... -- -- (6) (8)
Investor C Shares................................... -- -- (4) (6)
Net increase/(decrease) in net assets from Fund share
transactions........................................ 16,050 27,409 30,972 752,910
-------- -------- -------- --------
Net increase/(decrease) in net assets................. 16,611 28,238 43,580 764,745
NET ASSETS:
Beginning of period................................... 109,461 81,223 877,254 112,509
-------- -------- -------- --------
End of period......................................... $126,072 $109,461 $920,834 $877,254
======== ======== ======== ========
Undistributed net investment income at end of
period.............................................. $ 39 $ 39 $ 553 $ 552
======== ======== ======== ========
</TABLE>
- ---------------
* Amount represents less than $500
SEE NOTES TO FINANCIAL STATEMENTS.
88
<PAGE> 93
NATIONS FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
FLORIDA INTERMEDIATE FLORIDA
MUNICIPAL INCOME MUNICIPAL BOND MUNICIPAL BOND
----------------------------- ----------------------------- -----------------------------
SIX MONTHS ENDED SIX MONTHS ENDED SIX MONTHS ENDED
09/30/98 YEAR ENDED 09/30/98 YEAR ENDED 09/30/98 YEAR ENDED
(UNAUDITED) 03/31/98 (UNAUDITED) 03/31/98 (UNAUDITED) 03/31/98
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$ 13,853 $ 19,347 $ 5,244 $ 7,409 $ 3,131 $ 2,013
1,238 6,906 100 188 195 43
12,102 11,577 3,036 3,444 3,650 2,230
-------- -------- -------- -------- -------- -------
27,193 37,830 8,380 11,041 6,976 4,286
(12,373) (17,832) (4,906) (6,996) (1,475) (1,194)
(828) (795) (254) (265) (1,318) (89)
(554) (618) (76) (138) (332) (727)
(98) (102) (8) (10) (6) (3)
(960) (2,020) -- -- -- --
(40) (74) -- -- -- --
(32) (64) -- -- -- --
(5) (14) -- -- -- --
161,394 368,564 16,631 153,428 116,208 5,909
-------- -------- -------- -------- -------- -------
173,697 384,875 19,767 157,060 120,053 8,182
493,538 108,663 214,710 57,650 46,456 38,274
-------- -------- -------- -------- -------- -------
$667,235 $493,538 $234,477 $214,710 $166,509 $46,456
======== ======== ======== ======== ======== =======
$ 513 $ 513 $ --* $ --* $ 19 $ 19
======== ======== ======== ======== ======== =======
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
89
<PAGE> 94
NATIONS FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
In thousands
<TABLE>
<CAPTION>
GEORGIA INTERMEDIATE GEORGIA
MUNICIPAL BOND MUNICIPAL BOND
----------------------------- -----------------------------
SIX MONTHS ENDED SIX MONTHS ENDED
09/30/98 YEAR ENDED 09/30/98 YEAR ENDED
(UNAUDITED) 03/31/98 (UNAUDITED) 03/31/98
-------------------------------------------------------------
<S> <C> <C> <C> <C>
Net investment income....................................... $ 3,333 $ 5,114 $ 410 $ 717
Net realized gain/(loss) on investments..................... 473 1,003 21 120
Net change in unrealized appreciation/(depreciation) of
investments............................................... 2,170 2,219 485 720
-------- -------- ------- -------
Net increase in net assets resulting from operations........ 5,976 8,336 916 1,557
Distributions to shareholders from net investment income:
Primary A Shares.......................................... (2,924) (4,359) (204) (303)
Investor A Shares......................................... (251) (406) (14) (18)
Investor B Shares......................................... (140) (290) (192) (395)
Investor C Shares......................................... (17) (65) --* (2)
Distributions to shareholders from net realized gains on
investments:
Primary A Shares.......................................... (127) (509) -- --
Investor A Shares......................................... (10) (40) -- --
Investor B Shares......................................... (7) (30) -- --
Investor C Shares......................................... (1) (7) -- --
Net increase/(decrease) in net assets from Fund share
transactions.............................................. 18,932 79,018 3,141 1,849
-------- -------- ------- -------
Net increase/(decrease) in net assets....................... 21,431 81,648 3,647 2,688
NET ASSETS:
Beginning of period......................................... 143,512 61,864 18,700 16,012
-------- -------- ------- -------
End of period............................................... $164,943 $143,512 $22,347 $18,700
======== ======== ======= =======
Undistributed net investment income at end of period........ $ 11 $ 11 $ 9 $ 8
======== ======== ======= =======
</TABLE>
- ---------------
* Amount represents less than $500
SEE NOTES TO FINANCIAL STATEMENTS.
90
<PAGE> 95
NATIONS FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
MARYLAND INTERMEDIATE MARYLAND NORTH CAROLINA INTERMEDIATE
MUNICIPAL BOND MUNICIPAL BOND MUNICIPAL BOND
----------------------------- ----------------------------- -----------------------------
SIX MONTHS ENDED SIX MONTHS ENDED SIX MONTHS ENDED
09/30/98 YEAR ENDED 09/30/98 YEAR ENDED 09/30/98 YEAR ENDED
(UNAUDITED) 03/31/98 (UNAUDITED) 03/31/98 (UNAUDITED) 03/31/98
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$ 3,579 $ 4,268 $ 530 $ 759 $ 4,553 $ 6,273
212 35 28 49 266 643
2,775 2,605 573 850 2,687 2,119
-------- -------- ------- ------- -------- --------
6,566 6,908 1,131 1,658 7,506 9,035
(3,123) (3,395) (278) (351) (4,206) (5,650)
(345) (695) (38) (76) (213) (305)
(99) (174) (213) (332) (131) (264)
(12) (62) (1) --* (4) (53)
-- -- -- -- (217) --
-- -- -- -- (11) --
-- -- -- -- (8) --
-- -- -- -- --* --
94,412 18,484 7,781 7,019 5,303 153,481
-------- -------- ------- ------- -------- --------
97,399 21,066 8,382 7,918 8,019 156,244
105,918 84,852 22,025 14,107 195,983 39,739
-------- -------- ------- ------- -------- --------
$203,317 $105,918 $30,407 $22,025 $204,002 $195,983
======== ======== ======= ======= ======== ========
$ -- $ -- $ 7 $ 7 $ 81 $ 81
======== ======== ======= ======= ======== ========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
91
<PAGE> 96
NATIONS FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
In thousands
<TABLE>
<CAPTION>
NORTH CAROLINA SOUTH CAROLINA INTERMEDIATE
MUNICIPAL BOND MUNICIPAL BOND
--------------------------------- ------------------------------
SIX MONTHS ENDED SIX MONTHS ENDED
09/30/98 YEAR ENDED 09/30/98 YEAR ENDED
(UNAUDITED) 03/31/98 (UNAUDITED) 03/31/98
-------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net investment income................................. $ 696 $ 1,214 $ 6,423 $ 9,655
Net realized gain/(loss) on investments............... 11 72 320 660
Net change in unrealized appreciation/(depreciation)
of investments...................................... 747 1,539 3,581 3,345
------- ------- -------- --------
Net increase in net assets resulting from
operations.......................................... 1,454 2,825 10,324 13,660
Distributions to shareholders from net investment
income:
Primary A Shares.................................... (187) (221) (5,907) (8,701)
Investor A Shares................................... (27) (29) (341) (527)
Investor B Shares................................... (482) (963) (138) (261)
Investor C Shares................................... --* (1) (37) (166)
Distributions to shareholders from net realized gains
on investments:
Primary A Shares.................................... -- -- (280) (117)
Investor A Shares................................... -- -- (16) (5)
Investor B Shares................................... -- -- (8) (3)
Investor C Shares................................... -- -- (2) (2)
Net increase/(decrease) in net assets from Fund share
transactions........................................ 6,106 3,072 (7,226) 202,463
------- ------- -------- --------
Net increase/(decrease) in net assets................. 6,864 4,683 (3,631) 206,341
NET ASSETS:
Beginning of period................................... 32,252 27,569 276,551 70,210
------- ------- -------- --------
End of period......................................... $39,116 $32,252 $272,920 $276,551
======= ======= ======== ========
Undistributed net investment income at end of
period.............................................. $ 24 $ 24 $ 24 $ 24
======= ======= ======== ========
</TABLE>
- ---------------
* Amount represents less than $500
SEE NOTES TO FINANCIAL STATEMENTS.
92
<PAGE> 97
NATIONS FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
SOUTH CAROLINA TENNESSEE INTERMEDIATE TENNESSEE
MUNICIPAL BOND MUNICIPAL BOND MUNICIPAL BOND
-------------------------------- -------------------------------- -----------------------------
SIX MONTHS ENDED SIX MONTHS ENDED SIX MONTHS ENDED
09/30/98 YEAR ENDED 09/30/98 YEAR ENDED 09/30/98 YEAR ENDED
(UNAUDITED) 03/31/98 (UNAUDITED) 03/31/98 (UNAUDITED) 03/31/98
---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$ 475 $ 828 $ 1,125 $ 1,695 $ 231 $ 428
-- (39) 58 126 54 63
505 923 735 763 182 444
------- ------- ------- ------- ------- -------
980 1,712 1,918 2,584 467 935
(245) (332) (896) (1,272) (114) (170)
(26) (60) (177) (305) (26) (61)
(202) (434) (52) (118) (90) (195)
(1) (2) --* --* (1) (2)
-- (5) -- -- -- --
-- (1) -- -- -- --
-- (10) -- -- -- --
-- --* -- -- -- --
1,853 2,252 553 30,429 (662) 1,480
------- ------- ------- ------- ------- -------
2,359 3,120 1,346 31,318 (426) 1,987
21,394 18,274 50,079 18,761 10,957 8,970
------- ------- ------- ------- ------- -------
$23,753 $21,394 $51,425 $50,079 $10,531 $10,957
======= ======= ======= ======= ======= =======
$ 7 $ 7 $ 4 $ 4 $ 14 $ 14
======= ======= ======= ======= ======= =======
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
93
<PAGE> 98
NATIONS FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
In thousands
<TABLE>
<CAPTION>
TEXAS INTERMEDIATE
MUNICIPAL BOND TEXAS MUNICIPAL BOND
------------------------------ ------------------------------
SIX MONTHS ENDED SIX MONTHS ENDED
09/30/98 YEAR ENDED 09/30/98 YEAR ENDED
(UNAUDITED) 03/31/98 (UNAUDITED) 03/31/98
----------------------------------------------------------------
<S> <C> <C> <C> <C>
Net investment income................................. $ 9,224 $ 12,207 $ 364 $ 719
Net realized gain/(loss) on investments............... 987 908 43 187
Net change in unrealized appreciation/(depreciation)
of investments...................................... 4,458 3,698 295 744
-------- -------- ------- -------
Net increase in net assets resulting from
operations.......................................... 14,669 16,813 702 1,650
Distributions to shareholders from net investment
income:
Primary A Shares.................................... (9,106) (12,036) (193) (323)
Investor A Shares................................... (71) (64) (12) (18)
Investor B Shares................................... (41) (86) (157) (373)
Investor C Shares................................... (5) (21) (2) (5)
Net increase/(decrease) in net assets from Fund share
transactions........................................ 2,214 357,861 (389) (222)
-------- -------- ------- -------
Net increase/(decrease) in net assets................. 7,660 362,467 (51) 709
NET ASSETS:
Beginning of period................................... 390,913 28,446 16,919 16,210
-------- -------- ------- -------
End of period......................................... $398,573 $390,913 $16,868 $16,919
======== ======== ======= =======
Undistributed net investment income at end of
period.............................................. $ 8 $ 8 $ 28 $ 29
======== ======== ======= =======
</TABLE>
- ---------------
* Amount represents less than $500
SEE NOTES TO FINANCIAL STATEMENTS.
94
<PAGE> 99
NATIONS FUNDS
- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
<TABLE>
<CAPTION>
VIRGINIA INTERMEDIATE
MUNICIPAL BOND VIRGINIA MUNICIPAL BOND
----------------------------- -----------------------------
SIX MONTHS ENDED SIX MONTHS ENDED
09/30/98 YEAR ENDED 09/30/98 YEAR ENDED
(UNAUDITED) 03/31/98 (UNAUDITED) 03/31/98
-------------------------------------------------------------
<S> <C> <C> <C> <C>
$ 5,682 $ 10,395 $ 573 $ 1,002
6 480 -- 50
4,244 6,166 628 1,203
-------- -------- ------- -------
9,932 17,041 1,201 2,255
(4,256) (7,365) (291) (394)
(1,217) (2,413) (28) (44)
(187) (397) (254) (562)
(22) (221) --* (1)
28,606 8,526 2,410 3,610
-------- -------- ------- -------
32,856 15,171 3,038 4,864
236,641 221,470 25,333 20,469
-------- -------- ------- -------
$269,497 $236,641 $28,371 $25,333
======== ======== ======= =======
$ 145 $ 146 $ 7 $ 7
======== ======== ======= =======
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
95
<PAGE> 100
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY
<TABLE>
<CAPTION>
SHORT-TERM MUNICIPAL INCOME
SIX MONTHS ENDED
SEPTEMBER 30, 1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
-------------------- ------------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
------------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 2,345 $ 23,542 5,491 $ 55,100
Issued as reinvestment of dividends....................... 8 86 2 19
Redeemed.................................................. (2,306) (23,168) (4,590) (45,983)
------ -------- ------ --------
Net increase/(decrease)................................... 47 460 903 9,136
------ -------- ------ --------
INVESTOR A SHARES:
Sold...................................................... 3,088 31,079 4,262 42,742
Issued as reinvestment of dividends....................... 43 432 84 846
Redeemed.................................................. (1,806) (18,151) (2,846) (28,614)
------ -------- ------ --------
Net increase/(decrease)................................... 1,325 13,360 1,500 14,974
------ -------- ------ --------
INVESTOR B SHARES:
Sold...................................................... 265 2,662 1,111 11,128
Issued as reinvestment of dividends....................... 23 227 41 412
Redeemed.................................................. (213) (2,134) (854) (8,545)
------ -------- ------ --------
Net increase/(decrease)................................... 75 755 298 2,995
------ -------- ------ --------
INVESTOR C SHARES:
Sold...................................................... 424 4,261 115 1,155
Issued as reinvestment of dividends....................... 8 81 3 24
Redeemed.................................................. (285) (2,867) (88) (875)
------ -------- ------ --------
Net increase/(decrease)................................... 147 1,475 30 304
------ -------- ------ --------
Total net increase/(decrease)............................... 1,594 $ 16,050 2,731 $ 27,409
====== ======== ====== ========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
96
<PAGE> 101
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
INTERMEDIATE MUNICIPAL BOND
SIX MONTHS ENDED
SEPTEMBER 30, 1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
-------------------- ------------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
------------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 9,645 $ 99,560 11,793 $121,102
Issued in exchange for Pilot Shares of Pilot:
Intermediate Municipal Fund (Note 8).................... -- -- 21,603 218,049
Issued in exchange for assets of NationsBank Common Trust:
Intermediate Municipal Bond Fund (Note 8)............... -- -- 49,075 502,041
Issued as reinvestment of dividends....................... 46 380 51 522
Redeemed.................................................. (7,309) (75,567) (9,181) (94,446)
------ -------- ------ --------
Net increase/(decrease)................................... 2,382 24,373 73,341 747,268
------ -------- ------ --------
INVESTOR A SHARES:
Sold...................................................... 890 9,155 461 4,748
Issued in exchange for Class A Shares of Pilot:
Intermediate Municipal Fund (Note 8).................... -- -- 83 835
Issued as reinvestment of dividends....................... 11 118 11 115
Redeemed.................................................. (282) (2,900) (132) (1,362)
------ -------- ------ --------
Net increase/(decrease)................................... 619 6,373 423 4,336
------ -------- ------ --------
INVESTOR B SHARES:
Sold...................................................... 27 275 66 679
Issued as reinvestment of dividends....................... 3 30 4 44
Redeemed.................................................. (6) (64) (22) (232)
------ -------- ------ --------
Net increase/(decrease)................................... 24 241 48 491
------ -------- ------ --------
INVESTOR C SHARES:
Sold...................................................... 64 661 190 1,958
Issued as reinvestment of dividends....................... 4 39 5 45
Redeemed.................................................. (69) (715) (116) (1,188)
------ -------- ------ --------
Net increase/(decrease)................................... (1) (15) 79 815
------ -------- ------ --------
Total net increase/(decrease)............................... 3,021 $ 30,972 73,891 $752,910
====== ======== ====== ========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
97
<PAGE> 102
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
MUNICIPAL INCOME
SIX MONTHS ENDED
SEPTEMBER 30, 1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
------------------ ------------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
----------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 5,554 $ 63,608 7,932 $ 89,846
Issued in exchange for Pilot Shares of Pilot:
Municipal Bond Fund (Note 8)............................ -- -- 17,965 198,167
Issued in exchange for assets of NationsBank Common Trust:
Municipal Bond Fund (Note 8)............................ -- -- 14,127 159,212
Issued in exchange for assets of NationsBank Common Trust:
Municipal Bond Fund (Note 8)............................ 11,784 135,044 -- --
Issued as reinvestment of dividends....................... 19 198 32 359
Redeemed.................................................. (3,579) (41,078) (7,317) (82,863)
------ -------- ------ --------
Net increase/(decrease)................................... 13,778 157,772 32,739 364,721
------ -------- ------ --------
INVESTOR A SHARES:
Sold...................................................... 605 6,897 841 9,493
Issued in exchange for Class A Shares of Pilot:
Municipal Bond Fund (Note 8)............................ -- -- 147 1,622
Issued as reinvestment of dividends....................... 19 267 42 480
Redeemed.................................................. (230) (2,630) (737) (8,324)
------ -------- ------ --------
Net increase/(decrease)................................... 394 4,534 293 3,271
------ -------- ------ --------
INVESTOR B SHARES:
Sold...................................................... 74 850 250 2,787
Issued in exchange for Class B Shares of Pilot:
Municipal Bond Fund (Note 8)............................ -- -- 141 1,555
Issued as reinvestment of dividends....................... 14 156 32 363
Redeemed.................................................. (136) (1,562) (423) (4,759)
------ -------- ------ --------
Net increase/(decrease)................................... (48) (556) -- (54)
------ -------- ------ --------
INVESTOR C SHARES:
Sold...................................................... 25 279 255 2,901
Issued as reinvestment of dividends....................... 3 43 8 88
Redeemed.................................................. (59) (678) (207) (2,363)
------ -------- ------ --------
Net increase/(decrease)................................... (31) (356) 56 626
------ -------- ------ --------
Total net increase/(decrease)............................... 14,093 $161,394 33,088 $368,564
====== ======== ====== ========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
98
<PAGE> 103
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
FLORIDA INTERMEDIATE MUNICIPAL BOND
SIX MONTHS ENDED
SEPTEMBER 30, 1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
-------------------- ------------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
------------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 2,331 $ 25,104 3,473 $ 37,225
Issued in exchange for assets of NationsBank Common Trust:
Florida Municipal Bond Fund (Note 8).................... -- -- 12,807 136,392
Issued as reinvestment of dividends....................... 5 54 6 61
Redeemed.................................................. (1,798) (19,359) (2,340) (25,086)
------ -------- ------ --------
Net increase/(decrease)................................... 538 5,799 13,946 148,592
------ -------- ------ --------
INVESTOR A SHARES:
Sold...................................................... 1,067 11,486 593 6,334
Issued as reinvestment of dividends....................... 17 178 14 148
Redeemed.................................................. (331) (3,554) (144) (1,547)
------ -------- ------ --------
Net increase/(decrease)................................... 753 8,110 463 4,935
------ -------- ------ --------
INVESTOR B SHARES:
Sold...................................................... 127 1,255 52 552
Issued as reinvestment of dividends....................... 4 49 8 87
Redeemed.................................................. (61) (548) (61) (645)
------ -------- ------ --------
Net increase/(decrease)................................... 70 756 (1) (6)
------ -------- ------ --------
INVESTOR C SHARES:
Sold...................................................... 182 1,966 19 200
Issued as reinvestment of dividends....................... --* 5 --* 5
Redeemed.................................................. --* (5) (27) (298)
------ -------- ------ --------
Net increase/(decrease)................................... 182 1,966 (8) (93)
------ -------- ------ --------
Total net increase/(decrease)............................. 1,543 $ 16,631 14,400 $153,428
====== ======== ====== ========
</TABLE>
- ---------------
* Amount represents less than $500 or 500 shares, as applicable.
SEE NOTES TO FINANCIAL STATEMENTS.
99
<PAGE> 104
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
FLORIDA MUNICIPAL BOND
SIX MONTHS ENDED
SEPTEMBER 30, 1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
-------------------- ------------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
------------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 1,437 $ 14,534 2,139 $ 21,112
Issued in exchange for Emerald Shares of Emerald:
Florida Tax Exempt Fund (Note 8)........................ 4,083 40,620 -- --
Issued as reinvestment of dividends....................... 8 78 1 4
Redeemed.................................................. (871) (8,889) (1,161) (11,646)
------ -------- ------ --------
Net increase/(decrease)................................... 4,657 46,343 979 9,472
------ -------- ------ --------
INVESTOR A SHARES:
Sold...................................................... 241 2,424 33 325
Issued in exchange for Class A Shares of Emerald:
Florida Tax Exempt Fund (Note 8)........................ 7,877 78,346 -- --
Issued as reinvestment of dividends....................... 109 1,093 3 32
Redeemed.................................................. (1,179) (11,823) (21) (210)
------ -------- ------ --------
Net increase/(decrease)................................... 7,048 70,040 15 147
------ -------- ------ --------
INVESTOR B SHARES:
Sold...................................................... 122 1,216 114 1,149
Issued as reinvestment of dividends....................... 16 160 33 321
Redeemed.................................................. (155) (1,553) (524) (5,142)
------ -------- ------ --------
Net increase/(decrease)................................... (17) (177) (377) (3,672)
------ -------- ------ --------
INVESTOR C SHARES:
Sold...................................................... -- -- -- --
Issued as reinvestment of dividends....................... --* 2 --* 1
Redeemed.................................................. -- -- 4 (39)
------ -------- ------ --------
Net increase/(decrease)................................... --* 2 4 (38)
------ -------- ------ --------
Total net increase/(decrease)............................. 11,688 $116,208 621 $ 5,909
====== ======== ====== ========
</TABLE>
- ---------------
* Amount represents less than $500 or 500 shares, as applicable.
SEE NOTES TO FINANCIAL STATEMENTS.
100
<PAGE> 105
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
GEORGIA INTERMEDIATE MUNICIPAL BOND
SIX MONTHS ENDED
SEPTEMBER 30, 1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
------------------- ------------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
-----------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 1,155 $12,589 1,650 $ 18,023
Issued in exchange for assets of NationsBank Common Trust:
Georgia Municipal Bond Fund (Note 8).................... -- -- 4,858 52,613
Tax-Free Income Fund for Personal Trusts (Note 8)....... -- -- 2,405 26,050
Issued as reinvestment of dividends....................... 1 6 4 41
Redeemed.................................................. (814) (8,873) (1,519) (16,577)
----- ------- ------ --------
Net increase/(decrease)................................... 342 3,722 7,398 80,150
----- ------- ------ --------
INVESTOR A SHARES:
Sold...................................................... 1,421 15,658 214 2,333
Issued as reinvestment of dividends....................... 18 197 30 321
Redeemed.................................................. (58) (638) (212) (2,311)
----- ------- ------ --------
Net increase/(decrease)................................... 1,381 15,217 32 343
----- ------- ------ --------
INVESTOR B SHARES:
Sold...................................................... 42 464 20 216
Issued as reinvestment of dividends....................... 6 65 12 131
Redeemed.................................................. (31) (334) (75) (811)
----- ------- ------ --------
Net increase/(decrease)................................... 17 195 (43) (464)
----- ------- ------ --------
INVESTOR C SHARES:
Sold...................................................... 4 41 6 63
Issued as reinvestment of dividends....................... 1 18 4 46
Redeemed.................................................. (24) (261) (103) (1,120)
----- ------- ------ --------
Net increase/(decrease)................................... (19) (202) (93) (1,011)
----- ------- ------ --------
Total net increase/(decrease)............................. 1,721 $18,932 7,294 $ 79,018
===== ======= ====== ========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
101
<PAGE> 106
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
GEORGIA MUNICIPAL BOND
SIX MONTHS ENDED
SEPTEMBER 30, 1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
------------------- -----------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
---------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 173 $ 1,735 385 $ 3,815
Issued as reinvestment of dividends....................... --* --* --* --
Redeemed.................................................. (66) (662) (156) (1,535)
--- ------- ---- -------
Net increase/(decrease)................................... 107 1,073 229 2,280
--- ------- ---- -------
INVESTOR A SHARES:
Sold...................................................... 180 1,828 37 356
Issued as reinvestment of dividends....................... 2 13 2 16
Redeemed.................................................. (10) (101) (12) (120)
--- ------- ---- -------
Net increase/(decrease)................................... 172 1,740 27 252
--- ------- ---- -------
INVESTOR B SHARES:
Sold...................................................... 113 1,135 108 1,080
Issued as reinvestment of dividends....................... 11 108 21 208
Redeemed.................................................. (89) (891) (196) (1,923)
--- ------- ---- -------
Net increase/(decrease)................................... 35 352 (67) (635)
--- ------- ---- -------
INVESTOR C SHARES:
Sold...................................................... -- -- -- --
Issued as reinvestment of dividends....................... --* --* --* 2
Redeemed.................................................. (3) (24) (5) (50)
--- ------- ---- -------
Net increase/(decrease)................................... (3) (24) (5) (48)
--- ------- ---- -------
Total net increase/(decrease)............................. 311 $ 3,141 184 $ 1,849
=== ======= ==== =======
</TABLE>
- ---------------
* Amount represents less than $500 or 500 shares, as applicable.
SEE NOTES TO FINANCIAL STATEMENTS.
102
<PAGE> 107
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
MARYLAND INTERMEDIATE MUNICIPAL BOND
SIX MONTHS ENDED
SEPTEMBER 30, 1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
-------------------- -----------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
-----------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 1,198 $ 13,335 2,431 $26,652
Issued in exchange for assets of NationsBank Common Trust:
Intermediate Municipal Bond Fund (Note 8)............... 8,515 93,840 -- --
Issued as reinvestment of dividends....................... 5 48 7 74
Redeemed.................................................. (1,222) (13,582) (686) (7,519)
------ -------- ----- -------
Net increase.............................................. 8,496 93,641 1,752 19,207
------ -------- ----- -------
INVESTOR A SHARES:
Sold...................................................... 116 1,316 140 1,531
Issued as reinvestment of dividends....................... 25 281 52 570
Redeemed.................................................. (108) (1,234) (180) (1,976)
------ -------- ----- -------
Net increase/(decrease)................................... 33 363 12 125
------ -------- ----- -------
INVESTOR B SHARES:
Sold...................................................... 84 929 75 824
Issued as reinvestment of dividends....................... 7 77 12 138
Redeemed.................................................. (32) (353) (53) (583)
------ -------- ----- -------
Net increase/(decrease)................................... 59 653 34 379
------ -------- ----- -------
INVESTOR C SHARES:
Sold...................................................... 7 71 92 1,010
Issued as reinvestment of dividends....................... 1 10 5 50
Redeemed.................................................. (30) (326) (209) (2,287)
------ -------- ----- -------
Net decrease.............................................. (22) (245) (112) (1,228)
------ -------- ----- -------
Total net increase/(decrease)............................. 8,566 $ 94,412 1,686 $18,484
====== ======== ===== =======
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
103
<PAGE> 108
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
MARYLAND MUNICIPAL BOND
SIX MONTHS ENDED
SEPTEMBER 30, 1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
------------------- -----------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
----------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 756 $ 7,509 580 $ 5,633
Issued as reinvestment of dividends....................... --* 2 --* 4
Redeemed.................................................. (227) (2,263) (158) (1,553)
---- ------- ---- -------
Net increase.............................................. 529 5,248 422 4,084
---- ------- ---- -------
INVESTOR A SHARES:
Sold...................................................... 16 153 44 430
Issued as reinvestment of dividends....................... 3 33 7 64
Redeemed.................................................. (20) (200) (9) (92)
---- ------- ---- -------
Net increase/(decrease)................................... (1) (14) 42 402
---- ------- ---- -------
INVESTOR B SHARES:
Sold...................................................... 332 3,393 342 3,393
Issued as reinvestment of dividends....................... 17 173 26 258
Redeemed.................................................. (93) (1,019) (114) (1,118)
---- ------- ---- -------
Net increase/(decrease)................................... 256 2,547 254 2,533
---- ------- ---- -------
INVESTOR C SHARES:
Sold...................................................... -- -- 1 10
Issued as reinvestment of dividends....................... --* --* --* --*
Redeemed.................................................. -- -- (1) (10)
---- ------- ---- -------
Net decrease.............................................. -- -- -- --
---- ------- ---- -------
Total net increase/(decrease)............................. 784 $ 7,781 718 $ 7,019
==== ======= ==== =======
</TABLE>
- ---------------
* Amount represents less than $500 or 500 shares, as applicable.
SEE NOTES TO FINANCIAL STATEMENTS.
104
<PAGE> 109
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
NORTH CAROLINA INTERMEDIATE MUNICIPAL BOND
SIX MONTHS ENDED
SEPTEMBER 30, 1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
-------------------- --------------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
-----------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 1,748 $ 18,690 1,887 $ 20,130
Issued in exchange for assets of NationsBank Common Trust:
North Carolina Municipal Bond Fund (Note 8)............. -- -- 13,385 141,745
Issued as reinvestment of dividends....................... 1 13 --* --
Redeemed.................................................. (1,334) (14,261) (967) (10,283)
------ -------- ------ --------
Net increase/(decrease)................................... 415 4,442 14,305 151,592
------ -------- ------ --------
INVESTOR A SHARES:
Sold...................................................... 214 2,291 345 3,663
Issued as reinvestment of dividends....................... 14 147 24 253
Redeemed.................................................. (88) (937) (121) (1,277)
------ -------- ------ --------
Net increase/(decrease)................................... 140 1,501 248 2,639
------ -------- ------ --------
INVESTOR B SHARES:
Sold...................................................... 38 411 73 783
Issued as reinvestment of dividends....................... 10 103 19 205
Redeemed.................................................. (42) (450) (108) (1,149)
------ -------- ------ --------
Net increase/(decrease)................................... 6 64 (16) (161)
------ -------- ------ --------
INVESTOR C SHARES:
Sold...................................................... --* --* -- --
Issued as reinvestment of dividends....................... --* 4 4 47
Redeemed.................................................. (66) (708) (59) (636)
------ -------- ------ --------
Net increase/(decrease)................................... (66) (704) (55) (589)
------ -------- ------ --------
Total net increase/(decrease)............................. 495 $ 5,303 14,482 $153,481
====== ======== ====== ========
</TABLE>
- ---------------
* Amount represents less than $500 or 500 shares, as applicable.
SEE NOTES TO FINANCIAL STATEMENTS.
105
<PAGE> 110
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
NORTH CAROLINA MUNICIPAL BOND
SIX MONTHS ENDED
SEPTEMBER 30, 1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
------------------- -----------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
---------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 618 $ 6,218 386 $ 3,795
Issued as reinvestment of dividends....................... --* --* --* --*
Redeemed.................................................. (95) (960) (68) (669)
---- ------- ---- -------
Net increase/(decrease)................................... 523 5,258 318 3,126
---- ------- ---- -------
INVESTOR A SHARES:
Sold...................................................... 130 1,313 17 168
Issued as reinvestment of dividends....................... 1 10 3 25
Redeemed.................................................. (21) (211) (22) (214)
---- ------- ---- -------
Net increase/(decrease)................................... 110 1,112 (2) (21)
---- ------- ---- -------
INVESTOR B SHARES:
Sold...................................................... 192 1,921 251 2,493
Issued as reinvestment of dividends....................... 35 359 70 690
Redeemed.................................................. (253) (2,544) (325) (3,200)
---- ------- ---- -------
Net increase/(decrease)................................... (26) (264) (4) (17)
---- ------- ---- -------
INVESTOR C SHARES:
Sold...................................................... -- -- -- --
Issued as reinvestment of dividends....................... --* --* --* 1
Redeemed.................................................. -- -- (2) (17)
---- ------- ---- -------
Net increase/(decrease)................................... --* --* (2) (16)
---- ------- ---- -------
Total net increase/(decrease)............................. 607 $ 6,106 310 $ 3,072
==== ======= ==== =======
</TABLE>
- ---------------
* Amount represents less than $500 or 500 shares, as applicable.
SEE NOTES TO FINANCIAL STATEMENTS.
106
<PAGE> 111
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
SOUTH CAROLINA INTERMEDIATE MUNICIPAL BOND
SIX MONTHS ENDED
SEPTEMBER 30, 1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
-------------------- --------------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
-----------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 1,336 $ 14,412 2,146 $ 23,120
Issued in exchange for assets of NationsBank Common Trust:
Old Colony South Carolina Tax-Exempt Bond Fund
(Note 8)............................................... -- -- 6,420 68,635
South Carolina Municipal Fund (Note 8).................. -- -- 12,876 137,649
Issued as reinvestment of dividends....................... 8 81 11 126
Redeemed.................................................. (2,225) (24,012) (2,665) (28,647)
------ -------- ------ --------
Net increase/(decrease)................................... (881) (9,519) 18,788 200,888
------ -------- ------ --------
INVESTOR A SHARES:
Sold...................................................... 371 4,032 561 6,030
Issued as reinvestment of dividends....................... 16 170 22 238
Redeemed.................................................. (98) (1,065) (288) (3,086)
------ -------- ------ --------
Net increase/(decrease)................................... 289 3,137 295 3,182
------ -------- ------ --------
INVESTOR B SHARES:
Sold...................................................... 48 514 166 1,772
Issued as reinvestment of dividends....................... 9 94 16 170
Redeemed.................................................. (39) (424) (97) (1,034)
------ -------- ------ --------
Net increase/(decrease)................................... 18 184 85 908
------ -------- ------ --------
INVESTOR C SHARES:
Sold...................................................... 24 263 66 720
Issued as reinvestment of dividends....................... 2 26 9 96
Redeemed.................................................. (122) (1,317) (310) (3,326)
------ -------- ------ --------
Net increase/(decrease)................................... (96) (1,028) (235) (2,510)
------ -------- ------ --------
Total net increase/(decrease)............................. (670) $ (7,226) 18,933 $202,463
====== ======== ====== ========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
107
<PAGE> 112
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
SOUTH CAROLINA MUNICIPAL BOND
SIX MONTHS ENDED
SEPTEMBER 30, 1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
------------------- ------------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
-----------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 280 $2,881 454 $ 4,598
Issued as reinvestment of dividends....................... -- -- --* --*
Redeemed.................................................. (88) (904) (55) (556)
---- ------ ---- --------
Net increase.............................................. 192 1,977 399 4,042
---- ------ ---- --------
INVESTOR A SHARES:
Sold...................................................... 5 49 89 898
Issued as reinvestment of dividends....................... 2 23 4 45
Redeemed.................................................. (49) (504) (28) (289)
---- ------ ---- --------
Net increase/(decrease)................................... (42) (432) 65 654
---- ------ ---- --------
INVESTOR B SHARES:
Sold...................................................... 67 693 76 775
Issued as reinvestment of dividends....................... 13 127 28 278
Redeemed.................................................. (51) (525) (327) (3,274)
---- ------ ---- --------
Net increase/(decrease)................................... 29 295 (223) (2,221)
---- ------ ---- --------
INVESTOR C SHARES:
Sold...................................................... 1 12 2 25
Issued as reinvestment of dividends....................... --* 1 --* --*
Redeemed.................................................. -- 0 (25) (248)
---- ------ ---- --------
Net increase/(decrease)................................... 1 13 (23) (223)
---- ------ ---- --------
Total net increase/(decrease)............................. 180 $1,853 218 $ 2,252
==== ====== ==== ========
</TABLE>
- ---------------
* Amount represents less than $500 or 500 shares, as applicable.
SEE NOTES TO FINANCIAL STATEMENTS.
108
<PAGE> 113
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
TENNESSEE INTERMEDIATE MUNICIPAL BOND
SIX MONTHS ENDED
SEPTEMBER 30, 1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
------------------- ------------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
-----------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 252 $ 2,617 670 $ 6,913
Issued in exchange for assets of NationsBank Common Trust:
Tennessee Municipal Bond Fund (Note 8).................. -- -- 2,471 25,429
Issued as reinvestment of dividends....................... 3 33 2 20
Redeemed.................................................. (220) (2,290) (263) (2,723)
---- ------- ----- --------
Net increase.............................................. 35 360 2,880 29,639
---- ------- ----- --------
INVESTOR A SHARES:
Sold...................................................... 73 759 135 1,393
Issued as reinvestment of dividends....................... 13 140 23 241
Redeemed.................................................. (52) (535) (61) (622)
---- ------- ----- --------
Net increase/(decrease)................................... 34 364 97 1,012
---- ------- ----- --------
INVESTOR B SHARES:
Sold...................................................... 6 64 13 134
Issued as reinvestment of dividends....................... 4 43 10 99
Redeemed.................................................. (26) (278) (44) (455)
---- ------- ----- --------
Net increase/(decrease)................................... (16) (171) (21) (222)
---- ------- ----- --------
INVESTOR C SHARES:
Sold...................................................... -- -- -- --
Issued as reinvestment of dividends....................... --* --* --* --*
Redeemed.................................................. -- -- -- --
---- ------- ----- --------
Net increase/(decrease)................................... --* --* --* --*
---- ------- ----- --------
Total net increase/(decrease)............................... 53 $ 553 2,956 $ 30,429
==== ======= ===== ========
</TABLE>
- ---------------
* Amount represents less than $500 or 500 shares, as applicable.
SEE NOTES TO FINANCIAL STATEMENTS.
109
<PAGE> 114
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
TENNESSEE MUNICIPAL BOND
SIX MONTHS ENDED
SEPTEMBER 30, 1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
------------------- -----------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
----------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 113 $ 1,155 233 $ 2,348
Issued as reinvestment of dividends....................... --* --* --* --*
Redeemed.................................................. (58) (592) (54) (553)
---- ------- --- -------
Net increase.............................................. 55 563 179 1,795
---- ------- --- -------
INVESTOR A SHARES:
Sold...................................................... 17 173 33 321
Issued as reinvestment of dividends....................... 3 26 6 58
Redeemed.................................................. (114) (1,175) (3) (25)
---- ------- --- -------
Net increase/(decrease)................................... (94) (976) 36 354
---- ------- --- -------
INVESTOR B SHARES:
Sold...................................................... 12 125 16 156
Issued as reinvestment of dividends....................... 7 70 15 155
Redeemed.................................................. (44) (445) (98) (982)
---- ------- --- -------
Net increase/(decrease)................................... (25) (250) (67) (671)
---- ------- --- -------
INVESTOR C SHARES:
Sold...................................................... -- -- -- --
Issued as reinvestment of dividends....................... --* 1 --* 2
Redeemed.................................................. -- -- -- --
---- ------- --- -------
Net increase/(decrease)................................... --* 1 --* 2
---- ------- --- -------
Total net increase/(decrease)............................... (64) $ (662) 148 $ 1,480
==== ======= === =======
</TABLE>
- ---------------
* Amount represents less than $500 or 500 shares, as applicable.
SEE NOTES TO FINANCIAL STATEMENTS.
110
<PAGE> 115
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
TEXAS INTERMEDIATE MUNICIPAL BOND
SIX MONTHS ENDED
SEPTEMBER 30, 1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
------------------ ------------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
----------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 2,296 $ 24,094 1,850 $ 19,419
Issued in exchange for assets of NationsBank Common Trust:
Texas Municipal Bond Fund (Note 8)...................... -- -- 34,435 357,784
Issued as reinvestment of dividends....................... --* 4 1 7
Redeemed.................................................. (2,153) (22,594) (1,978) (20,694)
------ -------- ------ --------
Net increase/(decrease)................................... 143 1,504 34,308 356,516
------ -------- ------ --------
INVESTOR A SHARES:
Sold...................................................... 372 3,908 203 2,130
Issued as reinvestment of dividends....................... 4 40 3 38
Redeemed.................................................. (291) (3,055) (42) (442)
------ -------- ------ --------
Net increase/(decrease)................................... 85 893 164 1,726
------ -------- ------ --------
INVESTOR B SHARES:
Sold...................................................... 2 19 7 76
Issued as reinvestment of dividends....................... 3 28 6 57
Redeemed.................................................. (7) (69) (19) (198)
------ -------- ------ --------
Net decrease.............................................. (2) (22) (6) (65)
------ -------- ------ --------
INVESTOR C SHARES:
Sold...................................................... -- -- -- --
Issued as reinvestment of dividends....................... --* 4 2 21
Redeemed.................................................. (15) (165) (32) (337)
------ -------- ------ --------
Net increase/(decrease)................................... (15) (161) (30) (316)
------ -------- ------ --------
Total net increase/(decrease)............................. 211 $ 2,214 34,436 $357,861
====== ======== ====== ========
</TABLE>
- ---------------
* Amount represents less than $500 or 500 shares, as applicable.
SEE NOTES TO FINANCIAL STATEMENTS.
111
<PAGE> 116
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
TEXAS MUNICIPAL BOND
SIX MONTHS ENDED
SEPTEMBER 30,
1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
----------------- -----------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
--------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 172 $ 1,723 269 $ 2,658
Issued as reinvestment of dividends....................... --* --* --* --*
Redeemed.................................................. (89) (889) (109) (1,078)
---- ------- ---- -------
Net increase/(decrease)................................... 83 834 160 1,580
---- ------- ---- -------
INVESTOR A SHARES:
Sold...................................................... 55 554 3 34
Issued as reinvestment of dividends....................... 1 5 1 6
Redeemed.................................................. (55) (551) (1) (15)
---- ------- ---- -------
Net increase/(decrease)................................... 1 8 3 25
---- ------- ---- -------
INVESTOR B SHARES:
Sold...................................................... 2 20 6 61
Issued as reinvestment of dividends....................... 10 98 26 254
Redeemed.................................................. (134) (1,351) (219) (2,145)
---- ------- ---- -------
Net decrease.............................................. (122) (1,233) (187) (1,830)
---- ------- ---- -------
INVESTOR C SHARES:
Sold...................................................... -- -- -- --
Issued as reinvestment of dividends....................... --* 2 --* 3
Redeemed.................................................. -- -- -- --
---- ------- ---- -------
Net increase/(decrease)................................... --* 2 --* 3
---- ------- ---- -------
Total net increase/(decrease)............................... (38) $ (389) (24) $ (222)
==== ======= ==== =======
</TABLE>
- ---------------
* Amount represents less than $500 or 500 shares, as applicable.
SEE NOTES TO FINANCIAL STATEMENTS.
112
<PAGE> 117
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
VIRGINIA INTERMEDIATE MUNICIPAL BOND
SIX MONTHS ENDED
SEPTEMBER 30, 1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
------------------ ------------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
----------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 3,454 $ 37,845 3,742 $ 40,764
Issued in exchange for assets of NationsBank Common Trust:
Virginia Municipal Bond Fund............................ 437 4,781 -- --
Issued as reinvestment of dividends....................... 3 34 9 96
Redeemed.................................................. (1,239) (13,550) (2,136) (23,134)
------ -------- ------ --------
Net increase/(decrease)................................... 2,655 29,110 1,615 17,726
------ -------- ------ --------
INVESTOR A SHARES:
Sold...................................................... 313 3,411 577 6,271
Issued as reinvestment of dividends....................... 70 770 143 1,546
Redeemed.................................................. (414) (4,554) (1,036) (11,127)
------ -------- ------ --------
Net increase/(decrease)................................... (31) (373) (316) (3,310)
------ -------- ------ --------
INVESTOR B SHARES:
Sold...................................................... 81 886 39 421
Issued as reinvestment of dividends....................... 12 130 25 270
Redeemed.................................................. (36) (392) (174) (1,882)
------ -------- ------ --------
Net decrease.............................................. 57 624 (110) (1,191)
------ -------- ------ --------
INVESTOR C SHARES:
Sold...................................................... 39 428 6 64
Issued as reinvestment of dividends....................... 2 17 12 132
Redeemed.................................................. (110) (1,200) (450) (4,895)
------ -------- ------ --------
Net increase/(decrease)................................... (69) (755) (432) (4,699)
------ -------- ------ --------
Total net increase/(decrease)............................... 2,612 $ 28,606 757 $ 8,526
====== ======== ====== ========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
113
<PAGE> 118
NATIONS FUNDS
- --------------------------------------------------------------------------------
SCHEDULE OF CAPITAL STOCK ACTIVITY (CONTINUED)
<TABLE>
<CAPTION>
VIRGINIA MUNICIPAL BOND
SIX MONTHS ENDED
SEPTEMBER 30, 1998 YEAR ENDED
(UNAUDITED) MARCH 31, 1998
------------------- -----------------
SHARES DOLLARS SHARES DOLLARS
(000) (000) (000) (000)
----------------------------------------
<S> <C> <C> <C> <C>
PRIMARY A SHARES:
Sold...................................................... 304 $ 3,147 593 $ 5,815
Issued as reinvestment of dividends....................... 1 4 -- --
Redeemed.................................................. (97) (1,093) (94) (914)
--- ------- ---- -------
Net increase/(decrease)................................... 208 2,058 499 4,901
--- ------- ---- -------
INVESTOR A SHARES:
Sold...................................................... 13 128 66 643
Issued as reinvestment of dividends....................... 2 22 3 34
Redeemed.................................................. (11) (110) (24) (234)
--- ------- ---- -------
Net increase.............................................. 4 40 45 443
--- ------- ---- -------
INVESTOR B SHARES:
Sold...................................................... 71 713 52 505
Issued as reinvestment of dividends....................... 17 168 36 357
Redeemed.................................................. (57) (569) (260) (2,552)
--- ------- ---- -------
Net decrease.............................................. 31 312 (172) (1,690)
--- ------- ---- -------
INVESTOR C SHARES:
Sold...................................................... -- -- -- --
Issued as reinvestment of dividends....................... --* --* --* 1
Redeemed.................................................. -- -- (5) (45)
--- ------- ---- -------
Net increase.............................................. --* -- (5) (44)
--- ------- ---- -------
Total net increase.......................................... 243 $ 2,410 367 $ 3,610
=== ======= ==== =======
</TABLE>
- ---------------
* Amount represents less than $500 or 500 shares, as applicable.
SEE NOTES TO FINANCIAL STATEMENTS.
114
<PAGE> 119
[THIS PAGE INTENTIONALLY LEFT BLANK.]
115
<PAGE> 120
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS DISTRIBUTIONS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET FROM NET
BEGINNING INVESTMENT GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT REALIZED
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME CAPITAL GAINS
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
SHORT-TERM MUNICIPAL INCOME
PRIMARY A SHARES
Six months ended 09/30/1998
(unaudited).......................... $10.05 $0.21 $ 0.05 $0.26 $(0.21) --
Year ended 03/31/1998.................. 9.95 0.42 0.10 0.52 (0.42) --
Year ended 03/31/1997.................. 9.98 0.44 (0.03) 0.41 (0.44) --
Period ended 03/31/1996(b)............. 10.03 0.15 (0.05) 0.10 (0.15) --
Year ended 11/30/1995.................. 9.69 0.44 0.34 0.78 (0.44) --
Year ended 11/30/1994.................. 9.96 0.38 (0.27) 0.11 (0.38) $(0.00)#
Period ended 11/30/1993*............... 10.00 0.05 (0.04) 0.01 (0.05) --
INVESTOR A SHARES
Six months ended 09/30/1998
(unaudited).......................... $10.05 $0.20 $ 0.05 $0.25 $(0.20) --
Year ended 03/31/1998.................. 9.95 0.40 0.10 0.50 (0.40) --
Year ended 03/31/1997.................. 9.98 0.42 (0.03) 0.39 (0.42) --
Period ended 03/31/1996(b)............. 10.03 0.14 (0.05) 0.09 (0.14) --
Year ended 11/30/1995.................. 9.69 0.42 0.34 0.76 (0.42) --
Year ended 11/30/1994.................. 9.96 0.36 (0.27) 0.09 (0.36) $(0.00)#
Period ended 11/30/1993*............... 9.98 0.03 (0.02) 0.01 (0.03) --
INVESTOR B SHARES
Six months ended 09/30/1998
(unaudited).......................... $10.05 $0.19 $ 0.05 $0.24 $(0.19) --
Year ended 03/31/1998.................. 9.95 0.39 0.10 0.49 (0.39) --
Year ended 03/31/1997.................. 9.98 0.40 (0.03) 0.37 (0.40) --
Period ended 03/31/1996(b)............. 10.03 0.13 (0.05) 0.08 (0.13) --
Year ended 11/30/1995.................. 9.69 0.40 0.34 0.74 (0.40) --
Year ended 11/30/1994.................. 9.96 0.34 (0.27) 0.07 (0.34) $(0.00)#
Period ended 11/30/1993*............... 10.00 0.04 (0.04) 0.00 (0.04) --
INVESTOR C SHARES
Six months ended 09/30/1998
(unaudited).......................... $10.05 $0.19 $ 0.05 $0.24 $(0.19) --
Year ended 03/31/1998.................. 9.95 0.39 0.10 0.49 (0.39) --
Year ended 03/31/1997.................. 9.98 0.40 (0.03) 0.37 (0.40) --
Period ended 03/31/1996(b)............. 10.03 0.14 (0.05) 0.09 (0.14) --
Year ended 11/30/1995.................. 9.69 0.42 0.34 0.76 (0.42) --
Period ended 11/30/1994*............... 9.84 0.19 (0.15) 0.04 (0.19) $(0.00)#
</TABLE>
- ---------------
* Short-Term Municipal Income Primary A, Investor A, Investor B and Investor C
Shares commenced operations on October 7, 1993, November 2, 1993, October 12,
1993 and May 19, 1994, respectively.
++ Annualized.
++++ Total return represents aggregate total return for the period indicated
and does not reflect the deduction of any applicable sales charges.
# Amount includes distributions in excess of net investment income, which were
less than $0.01 per share.
(a) The effect of interest expense on the operating expense ratio was less than
0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
SEE NOTES TO FINANCIAL STATEMENTS.
116
<PAGE> 121
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
----------------------
RATIO OF RATIO OF RATIO OF
TOTAL NET ASSETS OPERATING NET INVESTMENT OPERATING
DIVIDENDS NET ASSET END OF EXPENSES TO INCOME TO PORTFOLIO EXPENSES TO
AND VALUE TOTAL PERIOD AVERAGE NET AVERAGE NET TURNOVER AVERAGE
DISTRIBUTIONS END OF PERIOD RETURN++++ (IN 000'S) ASSETS ASSETS RATE NET ASSETS
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$(0.21) $10.10 2.60% $71,551 0.40%++(a) 4.13%++ 13% 0.76%++
(0.42) 10.05 5.33 70,740 0.40(a) 4.17 94 0.77
(0.44) 9.95 4.15 61,072 0.40(a) 4.36 80 0.84
(0.15) 9.98 0.96 48,511 0.40+(a) 4.37++ 16 0.86++
(0.44) 10.03 8.16 49,961 0.45(a) 4.38 82 0.93
(0.38) 9.69 1.09 33,488 0.34(a) 3.83 57 0.80
(0.05) 9.96 0.06 5,999 0.09++ 3.16++ 45 1.04++
$(0.20) $10.10 2.50% $37,070 0.60%++(a) 3.93%++ 13% 0.96%++
(0.40) 10.05 5.12 23,580 0.60(a) 3.97 94 0.97
(0.42) 9.95 3.96 8,417 0.60(a) 4.16 80 1.04
(0.14) 9.98 0.90 4,599 0.60++(a) 4.17++ 16 1.06++
(0.42) 10.03 7.95 3,741 0.65(a) 4.18 82 1.13
(0.36) 9.69 0.90 217 0.52(a) 3.65 57 0.99
(0.03) 9.96 0.06 731 0.24++ 3.01++ 45 1.19++
$(0.19) $10.10 2.42% $14,572 0.75%++(a) 3.78%++ 13% 1.11%++
(0.39) 10.05 4.96 13,753 0.75(a) 3.82 94 1.12
(0.40) 9.95 3.78 10,655 0.75(a) 4.01 80 1.19
(0.13) 9.98 0.84 13,859 0.75++(a) 4.02++ 16 1.21++
(0.40) 10.03 7.78 9,803 0.80(a) 4.03 82 1.28
(0.34) 9.69 0.73 13,421 0.69(a) 3.48 57 1.15
(0.04) 9.96 (0.02) 5,863 0.44++ 2.81++ 45 1.39++
$(0.19) $10.10 2.42% $ 2,879 0.75%++(a) 3.78%++ 13% 1.11%++
(0.39) 10.05 4.99 1,388 0.75(a) 3.82 94 1.12
(0.40) 9.95 3.79 1,080 0.75(a) 4.01 80 1.19
(0.14) 9.98 0.85 2,072 0.72++(a) 4.05++ 16 1.18++
(0.42) 10.03 7.95 1,953 0.70(a) 4.13 82 1.18
(0.19) 9.69 0.45 323 0.59++(a) 3.58++ 57 1.05++
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
117
<PAGE> 122
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS DISTRIBUTIONS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET FROM NET
BEGINNING INVESTMENT GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT REALIZED
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME CAPITAL GAINS
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
INTERMEDIATE MUNICIPAL BOND
PRIMARY A SHARES
Six months ended 09/30/1998
(unaudited)...................... $10.30 $0.24 $ 0.18 $ 0.42 $(0.24) $(0.03)
Year ended 03/31/1998.............. 10.01 0.48 0.33 0.81 (0.48) (0.04)
Year ended 03/31/1997.............. 10.03 0.48 (0.02) 0.46 (0.48) --
Period ended 03/31/1996(b)......... 10.17 0.16 (0.14) 0.02 (0.16) --
Year ended 11/30/1995.............. 9.24 0.48 0.93 1.41 (0.48) --
Year ended 11/30/1994.............. 10.11 0.45 (0.86) (0.41) (0.45)# (0.01)
Period ended 11/30/1993*........... 10.00 0.14 0.11 0.25 (0.14) --
INVESTOR A SHARES
Six months ended 09/30/1998
(unaudited)...................... $10.30 $0.23 $ 0.18 $ 0.41 $(0.23) $(0.03)
Year ended 03/31/1998.............. 10.01 0.46 0.33 0.79 (0.46) (0.04)
Year ended 03/31/1997.............. 10.03 0.46 (0.02) 0.44 (0.46) --
Period ended 03/31/1996(b)......... 10.17 0.15 (0.14) 0.01 (0.15) --
Year ended 11/30/1995.............. 9.24 0.47 0.93 1.40 (0.47) --
Year ended 11/30/1994.............. 10.11 0.42 (0.86) (0.44) (0.42)# (0.01)
Period ended 11/30/1993*........... 10.10 0.12 0.01 0.13 (0.12) --
INVESTOR B SHARES
Six months ended 09/30/1998
(unaudited)...................... $10.30 $0.20 $ 0.18 $ 0.38 $(0.20) $(0.03)
Year ended 03/31/1998.............. 10.01 0.41 0.33 0.74 (0.41) (0.04)
Year ended 03/31/1997.............. 10.03 0.43 (0.02) 0.41 (0.43) --
Period ended 03/31/1996(b)......... 10.17 0.14 (0.14) 0.00 (0.14) --
Year ended 11/30/1995.............. 9.24 0.43 0.93 1.36 (0.43)# --
Period ended 11/30/1994*........... 10.13 0.39 (0.88) (0.49) (0.39)# (0.01)
INVESTOR C SHARES
Six months ended 09/30/1998
(unaudited)...................... $10.30 $0.20 $ 0.18 $ 0.38 $(0.20) $(0.03)
Year ended 03/31/1998.............. 10.01 0.42 0.33 0.75 (0.42) (0.04)
Year ended 03/31/1997.............. 10.03 0.43 (0.02) 0.41 (0.43) --
Period ended 03/31/1996(b)......... 10.17 0.14 (0.14) 0.00 (0.14) --
Year ended 11/30/1995.............. 9.24 0.43 0.93 1.36 (0.43) --
Period ended 11/30/1994*........... 9.35 0.03 (0.11) (0.08) (0.03) --
</TABLE>
- ---------------
* Intermediate Municipal Bond Primary A, Investor A, Investor B and Investor C
Shares commenced operations on July 30, 1993, August 17, 1993, December 2,
1993 and November 3, 1994, respectively.
++ Annualized.
++++ Total return represents aggregate total return for the period indicated
and does not reflect the deduction of any applicable sales charges.
# Amount includes distributions in excess of net investment income, which were
less than $0.01 per share.
(a) The effect of interest expense on the operating expense ratio was less than
0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
SEE NOTES TO FINANCIAL STATEMENTS.
118
<PAGE> 123
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
----------------------
RATIO OF RATIO OF RATIO OF
TOTAL NET ASSETS OPERATING NET INVESTMENT OPERATING
DIVIDENDS NET ASSET END OF EXPENSES TO INCOME TO PORTFOLIO EXPENSES TO
AND VALUE TOTAL PERIOD AVERAGE NET AVERAGE NET TURNOVER AVERAGE
DISTRIBUTIONS END OF PERIOD RETURN++++ (IN 000'S) ASSETS ASSETS RATE NET ASSETS
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$(0.27) $10.45 3.97% $903,900 0.50%++ 4.59%++ 13% 0.68%++
(0.52) 10.30 8.20 867,154 0.50(a) 4.65 47 0.74
(0.48) 10.01 4.63 108,204 0.50(a) 4.74 21 0.81
(0.16) 10.03 0.20 77,423 0.50++(a) 4.75++ 4 0.83++
(0.48) 10.17 15.60 73,897 0.45(a) 4.91 31 0.84
(0.46) 9.24 (4.25) 38,055 0.35(a) 4.59 51 0.88
(0.14) 10.11 2.46 28,335 0.24++ 4.07++ 23 0.96++
$(0.26) $10.45 3.87% $ 13,043 0.70%++ 4.39%++ 13% 0.88%++
(0.50) 10.30 7.99 6,487 0.70(a) 4.45 47 0.94
(0.46) 10.01 4.42 2,067 0.70(a) 4.54 21 1.01
(0.15) 10.03 0.13 1,500 0.70++(a) 4.55++ 4 1.03++
(0.47) 10.17 15.38 1,249 0.65(a) 4.71 31 1.04
(0.43) 9.24 (4.48) 172 0.53(a) 4.41 51 1.06
(0.12) 10.11 1.28 68 0.39++ 3.92++ 23 1.11++
$(0.23) $10.45 3.56% $ 2,294 1.30%++ 3.79%++ 13% 1.47%++
(0.45) 10.30 7.50 2,023 1.20(a) 3.95 47 1.44
(0.43) 10.01 4.12 1,481 1.00(a) 4.24 21 1.31
(0.14) 10.03 0.03 1,623 1.00++(a) 4.25++ 4 1.33++
(0.43) 10.17 15.02 1,352 0.95(a) 4.41 31 1.34
(0.40) 9.24 (5.00) 943 0.85++(a) 4.09++ 51 1.38++
$(0.23) $10.45 3.71% $ 1,597 1.30%++ 3.79%++ 13% 1.47%++
(0.46) 10.30 7.62 1,590 1.20(a) 3.95 47 1.44
(0.43) 10.01 4.11 756 1.00(a) 4.24 21 1.31
(0.14) 10.03 0.03 716 1.00++(a) 4.25++ 4 1.33++
(0.43) 10.17 14.96 359 0.95(a) 4.41 31 1.34
(0.03) 9.24 (0.52) 2 0.85++(a) 4.09++ 51 1.38++
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
119
<PAGE> 124
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS DISTRIBUTIONS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET FROM NET
BEGINNING INVESTMENT GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT REALIZED
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME CAPITAL GAINS
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
MUNICIPAL INCOME
PRIMARY A SHARES
Six months ended 09/30/1998
(unaudited)...................... $11.46 $ 0.27 $ 0.23 $ 0.50 $(0.27) $(0.02)
Year ended 03/31/1998.............. 10.89 0.57 0.62 1.19 (0.57) (0.05)
Year ended 03/31/1997.............. 10.84 0.59 0.05 0.64 (0.59) --
Period ended 03/31/1996(b)......... 11.08 0.20 (0.24) (0.04) (0.20) --
Year ended 11/30/1995.............. 9.64 0.59 1.44 2.03 (0.59) --
Year ended 11/30/1994.............. 11.33 0.57 (1.44) (0.87) (0.57)# (0.25)
Year ended 11/30/1993.............. 10.65 0.59 0.72 1.31 (0.59) (0.04)
INVESTOR A SHARES
Six months ended 09/30/1998
(unaudited)...................... $11.46 $ 0.26 $ 0.23 $ 0.49 $(0.26) $(0.02)
Year ended 03/31/1998.............. 10.89 0.54 0.62 1.16 (0.54) (0.05)
Year ended 03/31/1997.............. 10.84 0.57 0.05 0.62 (0.57) --
Period ended 03/31/1996(b)......... 11.08 0.19 (0.24) (0.05) (0.19) --
Year ended 11/30/1995.............. 9.64 0.57 1.44 2.01 (0.57) --
Year ended 11/30/1994.............. 11.33 0.55 (1.44) (0.89) (0.55)# (0.25)
Year ended 11/30/1993.............. 10.65 0.57 0.72 1.29 (0.57) (0.04)
INVESTOR B SHARES
Six months ended 09/30/1998
(unaudited)...................... $11.46 $ 0.22 $ 0.23 $ 0.45 $(0.22) $(0.02)
Year ended 03/31/1998.............. 10.89 0.48 0.62 1.10 (0.48) (0.05)
Year ended 03/31/1997.............. 10.84 0.51 0.05 0.56 (0.51) --
Period ended 03/31/1996(b)......... 11.08 0.17 (0.24) (0.07) (0.17) --
Year ended 11/30/1995.............. 9.64 0.51 1.44 1.95 (0.51) --
Year ended 11/30/1994.............. 11.33 0.49 (1.44) (0.95) (0.49)# (0.25)
Period ended 11/30/1993*........... 11.13 0.23 0.20 0.43 (0.23) --
INVESTOR C SHARES
Six months ended 09/30/1998
(unaudited)...................... $11.46 $ 0.22 $ 0.23 $ 0.45 $(0.22) $(0.02)
Year ended 03/31/1998.............. 10.89 0.49 0.62 1.11 (0.49) (0.05)
Year ended 03/31/1997.............. 10.84 0.53 0.05 0.58 (0.53) --
Period ended 03/31/1996(b)......... 11.08 0.18 (0.24) (0.06) (0.18) --
Year ended 11/30/1995.............. 9.64 0.51 1.44 1.95 (0.51) --
Year ended 11/30/1994.............. 11.33 0.49 (1.44) (0.95) (0.49)# (0.25)
Year ended 11/30/1993.............. 10.65 0.50 0.72 1.22 (0.50) (0.04)
</TABLE>
- ---------------
* Municipal Income Primary A, Investor A, Investor B and Investor C Shares
commenced operations on February 1, 1991, February 1, 1991, June 7, 1993 and
June 17, 1992, 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 includes distributions in excess of net investment income, which were
less than $0.01 per share.
(a) The effect of interest expense on the operating expense ratio was less than
0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
SEE NOTES TO FINANCIAL STATEMENTS.
120
<PAGE> 125
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
RATIO OF WITHOUT WAIVERS AND/OR
OPERATING EXPENSE REIMBURSEMENTS
EXPENSES TO ----------------------
RATIO OF AVERAGE NET RATIO OF RATIO OF
TOTAL NET ASSETS OPERATING ASSETS NET INVESTMENT OPERATING
DIVIDENDS NET ASSET END OF EXPENSES TO INCLUDING INCOME TO PORTFOLIO EXPENSES TO
AND VALUE TOTAL PERIOD AVERAGE NET INTEREST AVERAGE NET TURNOVER AVERAGE
DISTRIBUTIONS END OF PERIOD RETURN++++ (IN 000'S) ASSETS EXPENSE ASSETS RATE NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$(0.29) $11.67 4.49% $625,817 0.60%++ (a) 4.73%++ 6% 0.80%++
(0.62) 11.46 11.12 456,485 0.60 (a) 4.97 38 0.84
(0.59) 10.89 6.03 77,260 0.60 (a) 5.41 25 0.91
(0.20) 10.84 (0.41) 68,022 0.60++ (a) 5.35++ 4 0.91++
(0.59) 11.08 21.55 68,836 0.60 (a) 5.63 49 0.88
(0.82) 9.64 (8.17) 59,279 0.61 0.62% 5.42 63 0.90
(0.63) 11.33 12.54 88,386 0.52 -- 5.24 48 0.84
$(0.28) $11.67 4.39% $ 24,183 0.80%++ (a) 4.53%++ 6% 1.00%++
(0.59) 11.46 10.89 19,226 0.80 (a) 4.77 38 1.04
(0.57) 10.89 5.82 15,075 0.80 (a) 5.21 25 1.11
(0.19) 10.84 (0.47) 26,085 0.80++ (a) 5.15++ 4 1.11++
(0.57) 11.08 21.31 27,963 0.80 (a) 5.43 49 1.08
(0.80) 9.64 (8.34) 23,754 0.79 0.80% 5.24 63 1.08
(0.61) 11.33 12.37 28,415 0.60 -- 5.09 48 0.99
$(0.24) $11.67 4.05% $ 15,108 1.45%++ (a) 3.89%++ 6% 1.65%++
(0.53) 11.46 10.23 15,383 1.42 (a) 4.15 38 1.66
(0.51) 10.89 5.24 14,615 1.35 (a) 4.66 25 1.66
(0.17) 10.84 (0.66) 16,870 1.35++ (a) 4.60++ 4 1.66++
(0.51) 11.08 20.65 18,165 1.35 (a) 4.88 49 1.63
(0.74) 9.64 (8.86) 17,101 1.36 1.37% 4.67 63 1.65
(0.23) 11.33 3.89 15,133 1.27++ -- 4.49++ 48 1.59++
$(0.24) $11.67 4.10% $ 2,127 1.45%++ (a) 3.89%++ 6% 1.65%++
(0.54) 11.46 10.37 2,444 1.33 (a) 4.24 38 1.57
(0.53) 10.89 5.50 1,713 1.10 (a) 4.91 25 1.41
(0.18) 10.84 (0.60) 2,173 1.16++ (a) 4.79++ 4 1.47++
(0.51) 11.08 20.65 2,268 1.35 (a) 4.88 49 1.63
(0.74) 9.64 (8.86) 3,064 1.36 1.37% 4.67 63 1.65
(0.54) 11.33 11.69 6,331 1.27 -- 4.49 48 1.59
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
121
<PAGE> 126
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS DISTRIBUTIONS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET FROM NET
BEGINNING INVESTMENT GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT REALIZED
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME CAPITAL GAINS
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
FLORIDA INTERMEDIATE MUNICIPAL BOND
PRIMARY A SHARES
Six months ended 09/30/1998
(unaudited).......................... $10.77 $0.21 $ 0.14 $ 0.35 $(0.21) --
Year ended 03/31/1998.................. 10.40 0.50 0.37 0.87 (0.50) --
Year ended 03/31/1997.................. 10.46 0.49 (0.06) 0.43 (0.49) --
Period ended 03/31/1996(b)............. 10.63 0.17 (0.17) 0.00 (0.17) --
Year ended 11/30/1995.................. 9.61 0.48 1.02 1.50 (0.48) --
Year ended 11/30/1994.................. 10.50 0.45 (0.88) (0.43) (0.45)# (0.01)
Period ended 11/30/1993*............... 10.00 0.44 0.50 0.94 (0.44) --
INVESTOR A SHARES
Six months ended 09/30/1998
(unaudited).......................... $10.77 $0.21 $ 0.14 $ 0.35 $(0.21) --
Year ended 03/31/1998.................. 10.40 0.48 0.37 0.85 (0.48) --
Year ended 03/31/1997.................. 10.46 0.47 (0.06) 0.41 (0.47) --
Period ended 03/31/1996(b)............. 10.63 0.16 (0.17) (0.01) (0.16) --
Year ended 11/30/1995.................. 9.61 0.46 1.02 1.48 (0.46) --
Year ended 11/30/1994.................. 10.50 0.43 (0.88) (0.45) (0.43)# (0.01)
Period ended 11/30/1993*............... 9.99 0.42 0.51 0.93 (0.42) --
INVESTOR B SHARES
Six months ended 09/30/1998
(unaudited).......................... $10.77 $0.18 $ 0.14 $ 0.32 $(0.18) --
Year ended 03/31/1998.................. 10.40 0.43 0.37 0.80 (0.43) --
Year ended 03/31/1997.................. 10.46 0.44 (0.06) 0.38 (0.44) --
Period ended 03/31/1996(b)............. 10.63 0.15 (0.17) (0.02) (0.15) --
Year ended 11/30/1995.................. 9.61 0.43 1.02 1.45 (0.43) --
Year ended 11/30/1994.................. 10.50 0.40 (0.88) (0.48) (0.40)# (0.01)
Period ended 11/30/1993*............... 10.32 0.18 0.18 0.36 (0.18) --
INVESTOR C SHARES
Six months ended 09/30/1998
(unaudited).......................... $10.77 $0.18 $ 0.14 $ 0.32 $(0.18) --
Year ended 03/31/1998(c)............... 10.40 0.43 0.37 0.80 (0.43) --
Year ended 03/31/1997.................. 10.46 0.44 (0.06) 0.38 (0.44) --
Period ended 03/31/1996(b)............. 10.63 0.15 (0.17) (0.02) (0.15) --
Year ended 11/30/1995.................. 9.61 0.43 1.02 1.45 (0.43) --
Year ended 11/30/1994.................. 10.50 0.39 (0.88) (0.49) (0.39)# (0.01)
Period ended 11/30/1993*............... 9.98 0.35 0.52 0.87 (0.35) --
</TABLE>
- ---------------
* Florida Intermediate Municipal Bond Primary A, Investor A, Investor B and
Investor C Shares commenced operations on December 11, 1992, December 14,
1992, June 7, 1993 and December 17, 1992, respectively.
++ Annualized.
++++ Total return represents aggregate total return for the period indicated
and does not reflect the deduction of any applicable sales charges.
# Amount includes distributions in excess of net investment income, which were
less than $0.01 per share.
(a) The effect of interest expense on the operating expense ratio was less than
0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
(c) Per share net investment income has been calculated using the monthly
average shares method.
SEE NOTES TO FINANCIAL STATEMENTS.
122
<PAGE> 127
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
----------------------
RATIO OF RATIO OF RATIO OF
TOTAL NET ASSETS OPERATING NET INVESTMENT OPERATING
DIVIDENDS NET ASSET END OF EXPENSES TO INCOME TO PORTFOLIO EXPENSES TO
AND VALUE TOTAL PERIOD AVERAGE NET AVERAGE NET TURNOVER AVERAGE
DISTRIBUTIONS END OF PERIOD RETURN++++ (IN 000'S) ASSETS ASSETS RATE NET ASSETS
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$(0.21) $10.91 3.72% $212,368 0.50%++(a) 4.71%++ 2% 0.70%++
(0.50) 10.77 8.55 203,710 0.50(a) 4.74 13 0.02
(0.49) 10.40 4.22 51,748 0.50(a) 4.72 16 0.81
(0.17) 10.46 (0.06) 44,988 0.50++(a) 4.66++ 18 0.86++
(0.48) 10.63 15.92 44,038 0.55(a) 4.70 27 0.81
(0.46) 9.61 (4.26) 42,717 0.55(a) 4.44 34 0.76
(0.44) 10.50 9.50 41,489 0.44++ 4.28++ 15 0.80++
$(0.21) $10.91 3.61% $ 15,518 0.70%++(a) 4.51%++ 2% 0.90%++
(0.48) 10.77 8.34 7,205 0.70(a) 4.54 13 0.96
(0.47) 10.40 4.01 2,142 0.70(a) 4.52 16 1.01
(0.16) 10.46 (0.13) 2,029 0.70++(a) 4.46++ 18 1.06++
(0.46) 10.63 15.68 2,292 0.75(a) 4.50 27 1.01
(0.44) 9.61 (4.43) 2,114 0.73(a) 4.26 34 0.94
(0.42) 10.50 9.44 2,261 0.59++ 4.13++ 15 0.95++
$(0.18) $10.91 3.30% $ 4,418 1.30%++(a) 3.91%++ 2% 1.50%++
(0.43) 10.77 7.80 3,606 1.20(a) 4.04 13 1.46
(0.44) 10.40 3.70 3,488 1.00(a) 4.22 16 1.31
(0.15) 10.46 (0.23) 4,001 1.00++(a) 4.16++ 18 1.36++
(0.43) 10.63 15.34 4,775 1.05(a) 4.20 27 1.31
(0.41) 9.61 (4.73) 4,691 1.05(a) 3.94 34 1.26
(0.18) 10.50 3.53 3,328 0.94++ 3.78++ 15 1.30++
$(0.18) $10.91 3.29% $ 2,173 1.30%++(a) 3.91%++ 2% 1.50%++
(0.43) 10.77 7.80 188 1.20(a) 4.04 13 1.46
(0.44) 10.40 3.71 272 1.00(a) 4.22 16 1.31
(0.15) 10.46 (0.23) 275 1.00++(a) 4.16++ 18 1.36++
(0.43) 10.63 15.34 227 1.05(a) 4.20 27 1.31
(0.40) 9.61 (4.81) 614 1.13(a) 3.86 34 1.34
(0.35) 10.50 8.80 684 1.19++ 3.53++ 15 1.55++
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
123
<PAGE> 128
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS DISTRIBUTIONS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET FROM NET
BEGINNING INVESTMENT GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT REALIZED
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME CAPITAL GAINS
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
FLORIDA MUNICIPAL BOND
PRIMARY A SHARES
Six months ended 09/30/1998
(unaudited).......................... $ 9.99 $0.20 $ 0.20 $ 0.40 $(0.20) --
Year ended 03/31/1998.................. 9.48 0.48 0.51 0.99 (0.48) --
Year ended 03/31/1997.................. 9.47 0.48 0.01 0.49 (0.48) --
Period ended 03/31/1996(b)............. 9.76 0.16 (0.29) (0.13) (0.16) --
Year ended 11/30/1995.................. 8.40 0.51 1.36 1.87 (0.51) --
Period ended 11/30/1994*............... 9.93 0.49 (1.53) (1.04) (0.49) --
INVESTOR A SHARES
Six months ended 09/30/1998
(unaudited).......................... $ 9.99 $0.19 $ 0.20 $ 0.39 $(0.19) --
Year ended 03/31/1998.................. 9.48 0.46 0.51 0.97 (0.46) --
Year ended 03/31/1997.................. 9.47 0.46 0.01 0.47 (0.46) --
Period ended 03/31/1996(b)............. 9.76 0.15 (0.29) (0.14) (0.15) --
Year ended 11/30/1995.................. 8.40 0.49 1.36 1.85 (0.49) --
Period ended 11/30/1994*............... 9.98 0.47 (1.58) (1.11) (0.47) --
INVESTOR B SHARES
Six months ended 09/30/1998
(unaudited).......................... $ 9.99 $0.17 $ 0.20 $ 0.37 $(0.17) --
Year ended 03/31/1998.................. 9.48 0.40 0.51 0.91 (0.40) --
Year ended 03/31/1997.................. 9.47 0.41 0.01 0.42 (0.41) --
Period ended 03/31/1996(b)............. 9.76 0.14 (0.29) (0.15) (0.14) --
Year ended 11/30/1995.................. 8.40 0.44 1.36 1.80 (0.44) --
Year ended 11/30/1994.................. 9.73 0.45 (1.33) (0.88) (0.45) --
Period ended 11/30/1993*............... 10.00 0.03 (0.27) (0.24) (0.03) --
INVESTOR C SHARES
Six months ended 09/30/1998
(unaudited).......................... $ 9.99 $0.17 $ 0.20 $ 0.37 $(0.17) --
Year ended 03/31/1998(c)............... 9.48 0.41 0.51 0.92 (0.41) --
Year ended 03/31/1997.................. 9.47 0.44 0.01 0.45 (0.44) --
Period ended 03/31/1996(b)............. 9.76 0.14 (0.29) (0.15) (0.14) --
Year ended 11/30/1995.................. 8.40 0.44 1.36 1.80 (0.44) --
Period ended 11/30/1994*............... 8.47 0.03 (0.07) (0.04) (0.03) --
</TABLE>
- ---------------
* Florida Municipal Bond Primary A, Investor A, Investor B and Investor C
Shares commenced operations on December 13, 1993, December 10, 1993, October
22, 1993 and November 3, 1994, respectively.
++ Annualized.
++++ Total return represents aggregate total return for the period indicated
and does not reflect the deduction of any applicable sales charges.
(a) The effect of interest expense on the operating expense ratio was less than
0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
(c) Per share net investment income has been calculated using the monthly
average share method.
SEE NOTES TO FINANCIAL STATEMENTS.
124
<PAGE> 129
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
----------------------
RATIO OF RATIO OF RATIO OF
TOTAL NET ASSETS OPERATING NET INVESTMENT OPERATING
DIVIDENDS NET ASSET END OF EXPENSES TO INCOME TO PORTFOLIO EXPENSES TO
AND VALUE TOTAL PERIOD AVERAGE NET AVERAGE NET TURNOVER AVERAGE
DISTRIBUTIONS END OF PERIOD RETURN++++ (IN 000'S) ASSETS ASSETS RATE NET ASSETS
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$(0.20) $10.19 4.47% $75,390 0.60%++(a) 4.80%++ 11% 0.81%++
(0.48) 9.99 10.60 27,378 0.60(a) 4.85 19 0.90
(0.48) 9.48 5.29 16,702 0.60(a) 5.07 23 0.93
(0.16) 9.47 (1.33) 13,044 0.60++(a) 5.03++ 7 0.96++
(0.51) 9.76 22.69 11,219 0.39(a) 5.44 13 0.95
(0.49) 8.40 (10.70) 4,258 0.21++(a) 5.55++ 46 0.91++
$(0.19) $10.19 4.37% $73,898 0.80%++(a) 4.60%++ 11% 1.01%++
(0.46) 9.99 10.38 2,027 0.80(a) 4.65 19 1.10
(0.46) 9.48 5.09 1,781 0.80(a) 4.87 23 1.13
(0.15) 9.47 (1.40) 1,836 0.80++(a) 4.83++ 7 1.16++
(0.49) 9.76 22.45 1,787 0.59(a) 5.24 13 1.15
(0.47) 8.40 (11.35) 1,024 0.39++(a) 5.37++ 46 1.09++
$(0.17) $10.19 4.03% $17,218 1.45%++(a) 3.95%++ 11% 1.66%++
(0.40) 9.99 9.71 17,048 1.42(a) 4.03 19 1.72
(0.41) 9.48 4.52 19,751 1.35(a) 4.32 23 1.68
(0.14) 9.47 (1.58) 23,947 1.35++(a) 4.28++ 7 1.71++
(0.44) 9.76 21.78 25,398 1.14(a) 4.69 13 1.70
(0.45) 8.40 (9.37) 19,868 0.96(a) 4.80 46 1.66
(0.03) 9.73 (2.35) 11,434 0.68++ 3.29++ 3.29++ 0.00
$(0.17) $10.19 4.03% $ 3 1.45%++(a) 3.95%++ 11% 1.66%++
(0.41) 9.99 9.83 3 1.33(a) 4.12 19 1.63
(0.44) 9.48 4.78 40 1.10(a) 4.57 23 1.43
(0.14) 9.47 (1.52) 38 1.15++(a) 4.48++ 7 1.51++
(0.44) 9.76 21.80 38 1.14(a) 4.69 13 1.70
(0.03) 8.40 (0.43) 2 0.96++(a) 4.80++ 46 1.66++
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
125
<PAGE> 130
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS DISTRIBUTIONS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET FROM NET
BEGINNING INVESTMENT GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT REALIZED
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME CAPITAL GAINS
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
GEORGIA INTERMEDIATE MUNICIPAL BOND
PRIMARY A SHARES
Six months ended 09/30/1998
(unaudited)...................... $10.92 $0.21 $ 0.19 $ 0.40 $(0.21) $(0.01)
Year ended 03/31/1998.............. 10.58 0.49 0.38 0.87 (0.49) (0.04)
Year ended 03/31/1997.............. 10.63 0.50 (0.05) 0.45 (0.50) --
Period ended 03/31/1996(b)......... 10.81 0.17 (0.18) (0.01) (0.17) --
Year ended 11/30/1995.............. 9.82 0.50 0.99 1.49 (0.50) --
Year ended 11/30/1994.............. 10.82 0.49 (0.98) (0.49) (0.49)# (0.02)
Year ended 11/30/1993.............. 10.29 0.50 0.56 1.06 (0.50) (0.03)
INVESTOR A SHARES
Six months ended 09/30/1998
(unaudited)...................... $10.92 $0.20 $ 0.19 $ 0.39 $(0.20) $(0.01)
Year ended 03/31/1998.............. 10.58 0.47 0.38 0.85 (0.47) (0.04)
Year ended 03/31/1997.............. 10.63 0.48 (0.05) 0.43 (0.48) --
Period ended 03/31/1996(b)......... 10.81 0.16 (0.18) (0.02) (0.16) --
Year ended 11/30/1995.............. 9.82 0.48 0.99 1.47 (0.48) --
Year ended 11/30/1994.............. 10.82 0.47 (0.98) (0.51) (0.47)# (0.02)
Year ended 11/30/1993.............. 10.28 0.48 0.57 1.05 (0.48) (0.03)
INVESTOR B SHARES
Six months ended 09/30/1998
(unaudited)...................... $10.92 $0.17 $ 0.19 $ 0.36 $(0.17) $(0.01)
Year ended 03/31/1998.............. 10.58 0.42 0.38 0.80 (0.42) (0.04)
Year ended 03/31/1997.............. 10.63 0.45 (0.05) 0.40 (0.45) --
Period ended 03/31/1996(b)......... 10.81 0.15 (0.18) (0.03) (0.15) --
Year ended 11/30/1995.............. 9.82 0.45 0.99 1.44 (0.45) --
Year ended 11/30/1994.............. 10.82 0.44 (0.98) (0.54) (0.44)# (0.02)
Period ended 11/30/1993*........... 10.61 0.20 0.21 0.41 (0.20) --
INVESTOR C SHARES
Six months ended 09/30/1998
(unaudited)...................... $10.92 $0.17 $ 0.19 $ 0.36 $(0.17) $(0.01)
Year ended 03/31/1998(c)........... 10.58 0.42 0.38 0.80 (0.42) (0.04)
Year ended 03/31/1997.............. 10.63 0.45 (0.05) 0.40 (0.45) --
Period ended 03/31/1996(b)......... 10.81 0.15 (0.18) (0.03) (0.15) --
Year ended 11/30/1995.............. 9.82 0.45 0.99 1.44 (0.45) --
Year ended 11/30/1994.............. 10.82 0.43 (0.98) (0.55) (0.43)# (0.02)
Year ended 11/30/1993.............. 10.29 0.42 0.56 0.98 (0.42) (0.03)
</TABLE>
- ---------------
* Georgia Intermediate Municipal Bond Primary A, Investor A, Investor B and
Investor C Shares commenced operations on March 1, 1992, May 4, 1992,
June 7, 1993 and June 17, 1992, 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 includes distributions in excess of net investment income, which
were less than $0.01 per share.
(a) The effect of interest expense on the operating expense ratio was less
than 0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end
was November 30.
(c) Per share net investment income has been calculated using the monthly
average share method.
SEE NOTES TO FINANCIAL STATEMENTS.
126
<PAGE> 131
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
RATIO OF
OPERATING
EXPENSES TO
RATIO OF AVERAGE NET RATIO OF
TOTAL NET ASSETS OPERATING ASSETS NET INVESTMENT
DIVIDENDS NET ASSET END OF EXPENSES TO INCLUDING INCOME TO PORTFOLIO
AND VALUE TOTAL PERIOD AVERAGE NET INTEREST AVERAGE NET TURNOVER
DISTRIBUTIONS END OF PERIOD RETURN++++ (IN 000'S) ASSETS EXPENSE ASSETS RATE
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$(0.22) $11.10 4.09% $131,484 0.50%++ (a) 4.55%++ 8%
(0.53) 10.92 8.45 125,654 0.50 (a) 4.54 25
(0.50) 10.58 4.33 43,470 0.50 (a) 4.72 9
(0.17) 10.63 (0.13) 38,222 0.50 (a) 4.67++ 3
(0.50) 10.81 15.42 40,383 0.55 (a) 4.76 17
(0.51) 9.82 (4.70) 33,111 0.54 0.55% 4.74 22
(0.53) 10.82 10.43 30,738 0.46 -- 4.57 6
$(0.21) $11.10 3.99% $ 24,918 0.70%++ (a) 4.35%++ 8%
(0.51) 10.92 8.24 9,446 0.70 (a) 4.34 25
(0.48) 10.58 4.12 8,810 0.70 (a) 4.52 9
(0.16) 10.63 (0.19) 8,625 0.70 (a) 4.47++ 3
(0.48) 10.81 15.20 9,175 0.75 (a) 4.56 17
(0.49) 9.82 (4.87) 10,401 0.72 0.73% 4.56 22
(0.51) 10.82 10.37 16,752 0.61 -- 4.42 6
$(0.18) $11.10 3.68% $ 7,695 1.30%++ (a) 3.75%++ 8%
(0.46) 10.92 7.70 7,378 1.20 (a) 3.84 25
(0.45) 10.58 3.81 7,601 1.00 (a) 4.22 9
(0.15) 10.63 (0.29) 8,098 1.00 (a) 4.17++ 3
(0.45) 10.81 14.85 8,160 1.05 (a) 4.26 17
(0.46) 9.82 (5.17) 7,269 1.04 1.05% 4.24 22
(0.20) 10.82 3.86 4,506 0.96++ -- 4.07++ 6
$(0.18) $11.10 3.68% $ 846 1.30%++ (a) 3.75%++ 8%
(0.46) 10.92 7.70 1,034 1.20 (a) 3.84 25
(0.45) 10.58 3.81 1,983 1.00 (a) 4.22 9
(0.15) 10.63 (0.29) 2,445 1.00 (a) 4.17++ 3
(0.45) 10.81 14.85 2,606 1.05 (a) 4.26 17
(0.45) 9.82 (5.25) 2,397 1.12 1.13% 4.16 22
(0.45) 10.82 9.61 2,990 1.21 -- 3.82 6
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
----------------------
RATIO OF
OPERATING
EXPENSES TO
AVERAGE NET
ASSETS
----------------------------------------------
<S> <C>
0.70%++
0.75
0.80
0.83++
0.80
0.75
0.77
0.90%++
0.95
1.00
1.03++
1.00
0.93
0.92
1.50%++
1.45
1.30
1.33++
1.30
1.25
1.27++
1.50%++
1.45
1.30
1.33++
1.30
1.33
1.52
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
127
<PAGE> 132
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET
BEGINNING INVESTMENT GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME
----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
GEORGIA MUNICIPAL BOND
PRIMARY A SHARES
Six months ended 09/30/1998 (unaudited).................. $10.00 $0.20 $ 0.25 $ 0.45 $(0.20)
Year ended 03/31/1998.................................... 9.50 0.47 0.50 0.97 (0.47)
Year ended 03/31/1997.................................... 9.48 0.47 0.02 0.49 (0.47)
Period ended 03/31/1996(b)............................... 9.72 0.16 (0.24) (0.08) (0.16)
Year ended 11/30/1995.................................... 8.38 0.51 1.34 1.85 (0.51)
Period ended 11/30/1994*................................. 10.02 0.46 (1.64) (1.18) (0.46)
INVESTOR A SHARES
Six months ended 09/30/1998 (unaudited).................. $10.00 $0.19 $ 0.25 $ 0.44 $(0.19)
Year ended 03/31/1998.................................... 9.50 0.45 0.50 0.95 (0.45)
Year ended 03/31/1997.................................... 9.48 0.45 0.02 0.47 (0.45)
Period ended 03/31/1996(b)............................... 9.72 0.14 (0.24) (0.10) (0.14)
Year ended 11/30/1995.................................... 8.38 0.49 1.34 1.83 (0.49)
Period ended 11/30/1994*................................. 9.99 0.47 (1.61) (1.14) (0.47)
INVESTOR B SHARES
Six months ended 09/30/1998 (unaudited).................. $10.00 $0.16 $ 0.25 $ 0.41 $(0.16)
Year ended 03/31/1998.................................... 9.50 0.39 0.50 0.89 (0.39)
Year ended 03/31/1997.................................... 9.48 0.40 0.02 0.42 (0.40)
Period ended 03/31/1996(b)............................... 9.72 0.14 (0.24) (0.10) (0.14)
Year ended 11/30/1995.................................... 8.38 0.44 1.34 1.78 (0.44)
Year ended 11/30/1994.................................... 9.81 0.45 (1.43) (0.98) (0.45)
Period ended 11/30/1993*................................. 10.00 0.04 (0.19) (0.15) (0.04)
INVESTOR C SHARES
Six months ended 09/30/1998 (unaudited).................. $10.00 $0.16 $ 0.25 $ 0.41 $(0.16)
Year ended 03/31/1998(c)................................. 9.50 0.40 0.50 0.90 (0.40)
Year ended 03/31/1997.................................... 9.48 0.42 0.02 0.44 (0.42)
Period ended 03/31/1996(b)............................... 9.72 0.14 (0.24) (0.10) (0.14)
Year ended 11/30/1995.................................... 8.38 0.44 1.34 1.78 (0.44)
Period ended 11/30/1994*................................. 8.45 0.03 (0.07) (0.04) (0.03)
</TABLE>
- ---------------
* Georgia Municipal Bond Primary A, Investor A, Investor B and Investor C
Shares commenced operations on January 13, 1994, December 30, 1993, October
21, 1993 and November 3, 1994, respectively.
++ Annualized.
++++ Total return represents aggregate total return for the period indicated and
does not reflect the deduction of any applicable sales charges.
(a) The effect of interest expense on the operating expense ratio was less than
0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
(c) Per share net investment income has been calculated using the monthly
average share method.
SEE NOTES TO FINANCIAL STATEMENTS.
128
<PAGE> 133
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
----------------------
RATIO OF RATIO OF RATIO OF
TOTAL NET ASSETS OPERATING NET INVESTMENT OPERATING
DIVIDENDS NET ASSET END OF EXPENSES TO INCOME TO PORTFOLIO EXPENSES TO
AND VALUE TOTAL PERIOD AVERAGE NET AVERAGE NET TURNOVER AVERAGE
DISTRIBUTIONS END OF PERIOD RETURN++++ (IN 000'S) ASSETS ASSETS RATE NET ASSETS
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$(0.20) $10.25 4.91% $ 9,438 0.60%++(a) 4.63%++ 8% 0.97%++
(0.47) 10.00 10.43 8,138 0.60(a) 4.82 30 1.02
(0.47) 9.50 5.29 5,550 0.60(a) 4.96 19 1.05
(0.16) 9.48 (0.84) 2,068 0.60++(a) 4.96++ 7 1.14++
(0.51) 9.72 22.48 2,628 0.40(a) 5.42 26 1.09
(0.46) 8.38 (12.07) 232 0.21++(a) 5.60++ 35 1.04++
$(0.19) $10.25 4.80% $ 2,250 0.80%++(a) 4.43%++ 8% 1.17%++
(0.45) 10.00 10.22 483 0.80(a) 4.62 30 1.22
(0.45) 9.50 5.05 208 0.80(a) 4.76 19 1.25
(0.14) 9.48 (1.08) 7 0.80++(a) 4.76++ 7 1.34++
(0.49) 9.72 22.25 7 0.60(a) 5.22 26 1.29
(0.47) 8.38 (11.71) 6 0.39++(a) 5.42++ 35 1.22++
$(0.16) $10.25 4.47% $10,656 1.45%++(a) 3.78%++ 8% 1.82%++
(0.39) 10.00 9.54 10,052 1.42(a) 4.00 30 1.84
(0.40) 9.50 4.50 10,182 1.35(a) 4.21 19 1.80
(0.14) 9.48 (1.09) 12,254 1.35++(a) 4.21++ 7 1.89++
(0.44) 9.72 21.58 13,017 1.15(a) 4.67 26 1.84
(0.45) 8.38 (10.28) 9,500 0.96(a) 4.85 35 1.79
(0.04) 9.81 (1.49) 4,820 0.70++ 3.63++ 30 2.08++
$(0.16) $10.25 4.45% $ 3 1.45%++(a) 3.78%++ 8% 1.82%++
(0.40) 10.00 9.64 27 1.33(a) 4.09 30 1.75
(0.42) 9.50 4.77 72 1.10(a) 4.46 19 1.55
(0.14) 9.48 (1.03) 69 1.16++(a) 4.40++ 7 1.70++
(0.44) 9.72 21.59 69 1.15(a) 4.67 26 1.84
(0.03) 8.38 (0.44) 2 0.96++(a) 4.85++ 35 1.79++
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
129
<PAGE> 134
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS DISTRIBUTIONS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET FROM NET
BEGINNING INVESTMENT GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT REALIZED
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME CAPITAL GAINS
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
MARYLAND INTERMEDIATE MUNICIPAL BOND
PRIMARY A SHARES
Six months ended 09/30/1998
(unaudited).......................... $11.01 $0.25 $ 0.17 $ 0.42 $(0.25) --
Year ended 03/31/1998.................. 10.70 0.51 0.31 0.82 (0.51) --
Year ended 03/31/1997.................. 10.80 0.51 (0.10) 0.41 (0.51) --
Period ended 03/31/1996(b)............. 10.95 0.17 (0.15) 0.02 (0.17) --
Year ended 11/30/1995.................. 10.00 0.51 0.98 1.49 (0.51) $(0.03)
Year ended 11/30/1994.................. 11.09 0.50 (0.99) (0.49) (0.50) (0.10)
Year ended 11/30/1993.................. 10.72 0.52 0.44 0.96 (0.52) (0.07)
INVESTOR A SHARES
Six months ended 09/30/1998
(unaudited).......................... $11.01 $0.24 $ 0.17 $ 0.41 $(0.24) --
Year ended 03/31/1998.................. 10.70 0.49 0.31 0.80 (0.49) --
Year ended 03/31/1997.................. 10.80 0.48 (0.10) 0.38 (0.48) --
Period ended 03/31/1996(b)............. 10.95 0.16 (0.15) 0.01 (0.16) --
Year ended 11/30/1995.................. 10.00 0.48 0.98 1.46 (0.48) $(0.03)
Year ended 11/30/1994.................. 11.09 0.48 (0.99) (0.51) (0.48) (0.10)
Year ended 11/30/1993.................. 10.72 0.51 0.44 0.95 (0.51) (0.07)
INVESTOR B SHARES
Six months ended 09/30/1998
(unaudited).......................... $11.01 $0.21 $ 0.17 $ 0.38 $(0.21) --
Year ended 03/31/1998.................. 10.70 0.43 0.31 0.74 (0.43) --
Year ended 03/31/1997.................. 10.80 0.45 (0.10) 0.35 (0.45) --
Period ended 03/31/1996(b)............. 10.95 0.15 (0.15) 0.00 (0.15) --
Year ended 11/30/1995.................. 10.00 0.45 0.98 1.43 (0.45) $(0.03)
Year ended 11/30/1994.................. 11.09 0.45 (0.99) (0.54) (0.45) (0.10)
Period ended 11/30/1993*............... 10.94 0.21 0.17 0.38 (0.21) (0.02)
INVESTOR C SHARES
Six months ended 09/30/1998
(unaudited).......................... $11.01 $0.21 $ 0.17 $ 0.38 $(0.21) --
Year ended 03/31/1998.................. 10.70 0.43 0.31 0.74 (0.43) --
Year ended 03/31/1997.................. 10.80 0.45 (0.10) 0.35 (0.45) --
Period ended 03/31/1996(b)............. 10.95 0.15 (0.15) 0.00 (0.15) --
Year ended 11/30/1995.................. 10.00 0.45 0.98 1.43 (0.45) $(0.03)
Year ended 11/30/1994.................. 11.09 0.44 (0.99) (0.55) (0.44) (0.10)
Year ended 11/30/1993.................. 10.72 0.40 0.44 0.84 (0.40) (0.07)
</TABLE>
- ---------------
* Maryland Intermediate Municipal Bond Primary A, Investor A, Investor B
and Investor C Shares commenced operations on September 1, 1990,
September 1, 1990, June 8, 1993 and June 17, 1992, 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) The effect of interest expense on the operating expense ratio was less
than 0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end
was November 30.
SEE NOTES TO FINANCIAL STATEMENTS.
130
<PAGE> 135
NATIONS FUNDS
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
RATIO OF
OPERATING RATIO OF
DISTRIBUTION TOTAL NET ASSETS EXPENSES TO NET INVESTMENT
IN EXCESS OF DIVIDENDS NET ASSET END OF AVERAGE INCOME TO PORTFOLIO
NET REALIZED AND VALUE TOTAL PERIOD NET AVERAGE NET TURNOVER
CAPITAL GAINS DISTRIBUTIONS END OF PERIOD RETURN++++ (IN 000'S) ASSETS ASSETS RATE
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
-- $(0.25) $11.18 3.89% $181,006 0.50%++(a) 4.57%++ 9%
-- (0.51) 11.01 7.83 84,715 0.50 4.63 12
-- (0.51) 10.70 3.83 63,549 0.50(a) 4.70 10
-- (0.17) 10.80 0.16 61,337 0.50++(a) 4.62++ 4
-- (0.54) 10.95 15.16 62,460 0.55(a) 4.76 11
$(0.00)# (0.60) 10.00 (4.64) 61,349 0.53(a) 4.73 22
-- (0.59) 11.09 9.11 61,552 0.49 4.73 26
-- $(0.24) $11.18 3.78% $ 16,168 0.70%++(a) 4.37%++ 9%
-- (0.49) 11.01 7.61 15,558 0.70 4.43 12
-- (0.48) 10.70 3.62 14,988 0.70(a) 4.50 10
-- (0.16) 10.80 0.09 19,456 0.70++(a) 4.42++ 4
-- (0.51) 10.95 14.94 21,208 0.75(a) 4.56 11
$(0.00)# (0.58) 10.00 (4.82) 22,145 0.71(a) 4.55 22
-- (0.58) 11.09 8.96 22,144 0.64 4.58 26
-- $(0.21) $11.18 3.47% $ 5,540 1.30%++(a) 3.77%++ 9%
-- (0.43) 11.01 7.07 4,804 1.20 3.93 12
-- (0.45) 10.70 3.31 4,299 1.00(a) 4.20 10
-- (0.15) 10.80 (0.01) 4,500 1.00++(a) 4.12++ 4
-- (0.48) 10.95 14.59 4,485 1.05(a) 4.26 11
$(0.00)# (0.55) 10.00 (5.12) 4,368 1.03(a) 4.23 22
-- (0.23) 11.09 3.53 3,234 0.99++ 4.23++ 26
-- $(0.21) $11.18 3.47% $ 603 1.30%++(a) 3.77%++ 9%
-- (0.43) 11.01 7.07 840 1.20 3.93 12
-- (0.45) 10.70 3.31 2,017 1.00(a) 4.20 10
-- (0.15) 10.80 (0.01) 2,900 1.00++(a) 4.12++ 4
-- (0.48) 10.95 14.59 2,808 1.05(a) 4.26 11
$(0.00)# (0.54) 10.00 (5.20) 2,570 1.11(a) 4.15 22
-- (0.47) 11.09 8.30 4,424 1.24 3.98 26
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
----------------------
RATIO OF
OPERATING
EXPENSES TO
AVERAGE
NET ASSETS
----------------------
<S> <C>
0.73%++
0.80
0.78
0.81++
0.80
0.73
0.73
0.93%++
1.00
0.98
1.01++
1.00
0.91
0.88
1.53%++
1.50
1.28
1.31++
1.30
1.23
1.23++
1.53%++
1.50
1.28
1.31++
1.30
1.31
1.48
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
131
<PAGE> 136
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS DISTRIBUTIONS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET FROM NET
BEGINNING INVESTMENT GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT REALIZED
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME CAPITAL GAINS
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
MARYLAND MUNICIPAL BOND
PRIMARY A SHARES
Six months ended 09/30/1998
(unaudited)..................... $ 9.94 $0.22 $ 0.20 $ 0.42 $(0.22) --
Year ended 03/31/1998............. 9.41 0.45 0.53 0.98 (0.45) --
Year ended 03/31/1997............. 9.39 0.46 0.02 0.48 (0.46) --
Period ended 03/31/1996(b)........ 9.63 0.15 (0.24) (0.09) (0.15) --
Year ended 11/30/1995............. 8.37 0.48 1.26 1.74 (0.48) --
Period ended 11/30/1994*.......... 8.90 0.11 (0.53) (0.42) (0.11) --
INVESTOR A SHARES
Six months ended 09/30/1998
(unaudited)..................... $ 9.94 $0.21 $ 0.20 $ 0.41 $(0.21) --
Year ended 03/31/1998............. 9.41 0.43 0.53 0.96 (0.43) --
Year ended 03/31/1997............. 9.39 0.44 0.02 0.46 (0.44) --
Period ended 03/31/1996(b)........ 9.63 0.14 (0.24) (0.10) (0.14) --
Year ended 11/30/1995............. 8.37 0.46 1.26 1.72 (0.46) --
Year ended 11/30/1994............. 9.77 0.49 (1.40) (0.91) (0.49) --
Period ended 11/30/1993*.......... 9.80 0.03 (0.03) 0.00 (0.03) --
INVESTOR B SHARES
Six months ended 09/30/1998
(unaudited)..................... $ 9.94 $0.18 $ 0.20 $ 0.38 $(0.18) --
Year ended 03/31/1998............. 9.41 0.37 0.53 0.90 (0.37) --
Year ended 03/31/1997............. 9.39 0.39 0.02 0.41 (0.39) --
Period ended 03/31/1996(b)........ 9.63 0.13 (0.24) (0.11) (0.13) --
Year ended 11/30/1995............. 8.37 0.41 1.26 1.67 (0.41) --
Year ended 11/30/1994............. 9.77 0.44 (1.40) (0.96) (0.44) --
Period ended 11/30/1993*.......... 10.00 0.04 (0.23) (0.19) (0.04) --
INVESTOR C SHARES
Six months ended 09/30/1998
(unaudited)..................... $ 9.94 $0.18 $ 0.20 $ 0.38 $(0.18) --
Year ended 03/31/1998............. 9.41 0.39 0.53 0.92 (0.39) --
Year ended 03/31/1997............. 9.39 0.42 0.02 0.44 (0.42) --
Period ended 03/31/1996(b)........ 9.63 0.13 (0.24) (0.11) (0.13) --
Year ended 11/30/1995............. 8.37 0.41 1.26 1.67 (0.41) --
Period ended 11/30/1994*.......... 8.44 0.03 (0.07) (0.04) (0.03) --
</TABLE>
- ---------------
* Maryland Municipal Bond Primary A, Investor A, Investor B and Investor C
Shares commenced operations on September 20, 1994, November 4, 1993,
October 21, 1993 and November 3, 1994, respectively.
++ Annualized.
++++ Total return represents aggregate total return for the period indicated and
does not reflect the deduction of any applicable sales charges.
(a) The effect of interest expense on the operating expense ratio was less than
0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
SEE NOTES TO FINANCIAL STATEMENTS.
132
<PAGE> 137
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
----------------------
RATIO OF RATIO OF RATIO OF
TOTAL NET ASSETS OPERATING NET INVESTMENT OPERATING
DIVIDENDS NET ASSET END OF EXPENSES TO INCOME TO PORTFOLIO EXPENSES TO
AND VALUE TOTAL PERIOD AVERAGE AVERAGE NET TURNOVER AVERAGE
DISTRIBUTIONS END OF PERIOD RETURN++++ (IN 000'S) NET ASSETS ASSETS RATE NET ASSETS
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$(0.22) $10.14 4.27% $14,598 0.60%++(a) 4.37%++ 10% 0.96%++
(0.45) 9.94 10.62 9,049 0.60 4.61 17 1.07
(0.46) 9.41 5.20 4,596 0.60 4.88 18 1.12
(0.15) 9.39 (0.95) 2,788 0.60++ 4.72++ 7 1.23++
(0.48) 9.63 21.23 2,595 0.40 5.14 11 1.26
(0.11) 8.37 (4.89) 39 0.21++(a) 5.48++ 39 1.30++
$(0.21) $10.14 4.17% $ 1,926 0.80%++(a) 4.17%++ 10% 1.16%++
(0.43) 9.94 10.40 1,902 0.80 4.41 17 1.27
(0.44) 9.41 4.99 1,409 0.80 4.68 18 1.32
(0.14) 9.39 (1.01) 1,086 0.80++ 4.52++ 7 1.43++
(0.46) 9.63 20.99 1,031 0.60 4.94 11 1.46
(0.49) 8.37 (9.59) 9 0.39(a) 5.30 39 1.48
(0.03) 9.77 0.05 6 0.13++ 3.97++ 1 1.76++
$(0.18) $10.14 3.83% $13,880 1.45%++(a) 3.52%++ 10% 1.81%++
(0.37) 9.94 9.72 11,071 1.42 3.79 17 1.89
(0.39) 9.41 4.42 8,099 1.35 4.13 18 1.87
(0.13) 9.39 (1.19) 9,662 1.35++ 3.97++ 7 1.98++
(0.41) 9.63 20.33 10,002 1.15 4.39 11 2.01
(0.44) 8.37 (10.11) 4,819 0.96(a) 4.73 39 2.05
(0.04) 9.77 (1.94) 3,048 0.73++ 3.37++ 1 2.36++
$(0.18) $10.14 3.84% $ 3 1.45%++(a) 3.52%++ 10% 1.81%++
(0.39) 9.94 9.88 3 1.33 3.88 17 1.80
(0.42) 9.41 4.73 2 1.10 4.38 18 1.62
(0.13) 9.39 (1.13) 2 1.16++ 4.16++ 7 1.79++
(0.41) 9.63 20.29 2 1.15 4.39 11 2.01
(0.03) 8.37 (0.45) 2 0.96++(a) 4.73++ 39 2.05++
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
133
<PAGE> 138
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS DISTRIBUTIONS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET FROM NET
BEGINNING INVESTMENT GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT REALIZED
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME CAPITAL GAINS
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
NORTH CAROLINA INTERMEDIATE MUNICIPAL BOND
PRIMARY A SHARES
Six months ended 09/30/1998
(unaudited)...................... $10.70 $0.25 $ 0.15 $ 0.40 $(0.25) $(0.01)
Year ended 03/31/1998.............. 10.34 0.49 0.36 0.85 (0.49) --
Year ended 03/31/1997.............. 10.36 0.47 (0.02) 0.45 (0.47) --
Period ended 03/31/1996(b)......... 10.51 0.16 (0.15) 0.01 (0.16) --
Year ended 11/30/1995.............. 9.53 0.45 0.99 1.44 (0.45)# $(0.01)
Year ended 11/30/1994.............. 10.46 0.44 (0.88) (0.44) (0.44) (0.05)
Period ended 11/30/1993*........... 10.00 0.43 0.46 0.89 (0.43) --
INVESTOR A SHARES
Six months ended 09/30/1998
(unaudited)...................... $10.70 $0.24 $ 0.15 $ 0.39 $(0.24) $(0.01)
Year ended 03/31/1998.............. 10.34 0.47 0.36 0.83 (0.47) --
Year ended 03/31/1997.............. 10.36 0.45 (0.02) 0.43 (0.45) --
Period ended 03/31/1996(b)......... 10.51 0.15 (0.15) 0.00 (0.15) --
Year ended 11/30/1995.............. 9.53 0.43 0.99 1.42 (0.43)# (0.01)
Year ended 11/30/1994.............. 10.46 0.42 (0.88) (0.46) (0.42) (0.05)
Period ended 11/30/1993*........... 10.01 0.42 0.45 0.87 (0.42) --
INVESTOR B SHARES
Six months ended 09/30/1998
(unaudited)...................... $10.70 $0.21 $ 0.15 $ 0.36 $(0.21) $(0.01)
Year ended 03/31/1998.............. 10.34 0.42 0.36 0.78 (0.42) --
Year ended 03/31/1997.............. 10.36 0.42 (0.02) 0.40 (0.42) --
Period ended 03/31/1996(b)......... 10.51 0.14 (0.15) (0.01) (0.14) --
Year ended 11/30/1995.............. 9.53 0.40 0.99 1.39 (0.40)# (0.01)
Year ended 11/30/1994.............. 10.46 0.39 (0.88) (0.49) (0.39) (0.05)
Period ended 11/30/1993*........... 10.31 0.18 0.15 0.33 (0.18) --
INVESTOR C SHARES
Six months ended 09/30/1998
(unaudited)...................... $10.70 $0.21 $ 0.15 $ 0.36 $(0.21) $(0.01)
Year ended 03/31/1998.............. 10.34 0.42 0.36 0.78 (0.42) --
Year ended 03/31/1997.............. 10.36 0.42 (0.02) 0.40 (0.42) --
Period ended 03/31/1996(b)......... 10.51 0.14 (0.15) (0.01) (0.14) --
Year ended 11/30/1995.............. 9.53 0.40 0.99 1.39 (0.40)# (0.01)
Year ended 11/30/1994.............. 10.46 0.38 (0.88) (0.50) (0.38) (0.05)
Period ended 11/30/1993*........... 9.99 0.35 0.47 0.82 (0.35) --
</TABLE>
- ---------------
* North Carolina Intermediate Municipal Bond Primary A, Investor A, Investor B
and Investor C Shares commenced operations on December 11, 1992, December 14,
1992, June 7, 1993 and December 16, 1992, respectively.
++ Annualized.
++++ Total return represents aggregate total return for the period indicated
and does not reflect the deduction of any applicable sales charges.
# Amount includes distributions in excess of net investment income, which were
less than $0.01 per share.
(a) The effect of interest expense on the operating expense ratio was less than
0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
SEE NOTES TO FINANCIAL STATEMENTS.
134
<PAGE> 139
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
----------------------
RATIO OF RATIO OF RATIO OF
TOTAL NET ASSETS OPERATING NET INVESTMENT OPERATING
DIVIDENDS NET ASSET END OF EXPENSES TO INCOME TO PORTFOLIO EXPENSES TO
AND VALUE TOTAL PERIOD AVERAGE NET AVERAGE NET TURNOVER AVERAGE
DISTRIBUTIONS END OF PERIOD RETURN++++ (IN 000'S) ASSETS ASSETS RATE NET ASSETS
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$(0.26) $10.84 3.81% $186,656 0.50%++(a) 4.63%++ 9% 0.69%++
(0.49) 10.70 8.39 179,729 0.50(a) 4.69 21 0.76
(0.47) 10.34 4.45 25,855 0.50(a) 4.57 26 0.82
(0.16) 10.36 0.05 21,161 0.50++ 4.47++ 3 0.87++
(0.46) 10.51 15.41 20,916 0.57(a) 4.47 57 0.84
(0.49) 9.53 (4.34) 14,148 0.55(a) 4.38 37 0.82
(0.43) 10.46 9.03 11,814 0.42++ 4.23++ 29 0.85++
$(0.25) $10.84 3.70% $ 10,211 0.70%++(a) 4.43%++ 9% 0.89%++
(0.47) 10.70 8.17 8,572 0.70(a) 4.49 21 0.96
(0.45) 10.34 4.25 5,723 0.70(a) 4.37 26 1.02
(0.15) 10.36 (0.01) 7,672 0.70++ 4.27++ 3 1.07++
(0.44) 10.51 15.18 8,525 0.77(a) 4.27 57 1.04
(0.47) 9.53 (4.51) 8,896 0.73(a) 4.20 37 1.00
(0.42) 10.46 8.76 13,749 0.57++ 4.08++ 29 1.00++
$(0.22) $10.84 3.39% $ 7,016 1.30%++(a) 3.83%++ 9% 1.49%++
(0.42) 10.70 7.64 6,859 1.20(a) 3.99 21 1.46
(0.42) 10.34 3.94 6,796 1.00(a) 4.07 26 1.32
(0.14) 10.36 (0.12) 8,102 1.00++ 3.97++ 3 1.37++
(0.41) 10.51 14.84 7,848 1.07(a) 3.97 57 1.34
(0.44) 9.53 (4.82) 5,706 1.05(a) 3.88 37 1.32
(0.18) 10.46 3.23 3,822 0.92++ 3.73++ 29 1.35++
$(0.22) $10.84 3.39% $ 119 1.30%++(a) 3.83%++ 9% 1.49%++
(0.42) 10.70 7.64 822 1.20(a) 3.99 21 1.46
(0.42) 10.34 3.94 1,364 1.00(a) 4.07 26 1.32
(0.14) 10.36 (0.12) 1,379 1.00++ 3.97++ 3 1.37++
(0.41) 10.51 14.84 1,366 1.07(a) 3.97 57 1.34
(0.43) 9.53 (4.89) 1,486 1.13(a) 3.80 37 1.40
(0.35) 10.46 8.26 1,592 1.17++ 3.48++ 29 1.60++
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
135
<PAGE> 140
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET
BEGINNING INVESTMENT GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME
----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
NORTH CAROLINA MUNICIPAL BOND
PRIMARY A SHARES
Six months ended 09/30/1998 (unaudited)............ $10.01 $0.23 $ 0.21 $ 0.44 $(0.23)
Year ended 03/31/1998.............................. 9.47 0.47 0.54 1.01 (0.47)
Year ended 03/31/1997.............................. 9.49 0.47 (0.02) 0.45 (0.47)
Period ended 03/31/1996(b)......................... 9.73 0.16 (0.24) (0.08) (0.16)
Year ended 11/30/1995.............................. 8.36 0.50 1.37 1.87 (0.50)
Period ended 11/30/1994*........................... 10.06 0.45 (1.70) (1.25) (0.45)
INVESTOR A SHARES
Six months ended 09/30/1998 (unaudited)............ $10.01 $0.22 $ 0.21 $ 0.43 $(0.22)
Year ended 03/31/1998.............................. 9.47 0.45 0.54 0.99 (0.45)
Year ended 03/31/1997.............................. 9.49 0.45 (0.02) 0.43 (0.45)
Period ended 03/31/1996(b)......................... 9.73 0.15 (0.24) (0.09) (0.15)
Year ended 11/30/1995.............................. 8.36 0.49 1.37 1.86 (0.49)
Year ended 11/30/1994.............................. 9.85 0.50 (1.49) (0.99) (0.50)
Period ended 11/30/1993*........................... 9.97 0.04 (0.12) (0.08) (0.04)
INVESTOR B SHARES
Six months ended 09/30/1998 (unaudited)............ $10.01 $0.19 $ 0.21 $ 0.40 $(0.19)
Year ended 03/31/1998.............................. 9.47 0.39 0.54 0.93 (0.39)
Year ended 03/31/1997.............................. 9.49 0.40 (0.02) 0.38 (0.40)
Period ended 03/31/1996(b)......................... 9.73 0.13 (0.24) (0.11) (0.13)
Year ended 11/30/1995.............................. 8.36 0.43 1.37 1.80 (0.43)
Year ended 11/30/1994.............................. 9.85 0.45 (1.49) (1.04) (0.45)
Period ended 11/30/1993*........................... 10.00 0.04 (0.15) (0.11) (0.04)
INVESTOR C SHARES
Six months ended 09/30/1998 (unaudited)............ $10.01 $0.19 $ 0.21 $ 0.40 $(0.19)
Year ended 03/31/1998(c)........................... 9.47 0.40 0.54 0.94 (0.40)
Year ended 03/31/1997.............................. 9.49 0.42 (0.02) 0.40 (0.42)
Period ended 03/31/1996(b)......................... 9.73 0.14 (0.24) (0.10) (0.14)
Year ended 11/30/1995.............................. 8.36 0.43 1.37 1.80 (0.43)
Period ended 11/30/1994*........................... 8.45 0.03 (0.09) (0.06) (0.03)
</TABLE>
- ---------------
* North Carolina Municipal Bond Primary A, Investor A, Investor B and Investor
C Shares commenced operations on January 11, 1994, November 1, 1993, October
21, 1993 and November 3, 1994, 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) The effect of interest expense on the operating expense ratio was less than
0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
(c) Per share net investment income has been calculated using the monthly
average shares method.
SEE NOTES TO FINANCIAL STATEMENTS.
136
<PAGE> 141
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
----------------------
RATIO OF RATIO OF RATIO OF
TOTAL NET ASSETS OPERATING NET INVESTMENT OPERATING
DIVIDENDS NET ASSET END OF EXPENSES TO INCOME TO PORTFOLIO EXPENSES TO
AND VALUE TOTAL PERIOD AVERAGE NET AVERAGE NET TURNOVER AVERAGE
DISTRIBUTIONS END OF PERIOD RETURN++++ (IN 000'S) ASSETS ASSETS RATE NET ASSETS
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$(0.23) $10.22 4.48% $11,924 0.60%++ 4.61%++ 3% 0.89%++
(0.47) 10.01 10.86 6,452 0.60(a) 4.78 20 0.93
(0.02) 9.47 4.84 3,095 0.60(a) 4.95 28 0.94
(0.16) 9.49 (0.87) 1,593 0.60++ 4.86++ 22 0.99++
(0.50) 9.73 22.87 1,293 0.38(a) 5.43 40 0.96
(0.45) 8.36 (12.65) 531 0.21++(a) 5.53++ 29 0.92++
$(0.22) $10.22 4.38% $ 1,751 0.80%++ 4.41%++ 3% 1.09%++
(0.45) 10.01 10.64 609 0.80(a) 4.58 20 1.13
(0.02) 9.47 4.62 594 0.80(a) 4.75 28 1.14
(0.15) 9.49 (0.94) 448 0.80++ 4.66++ 22 1.19++
(0.49) 9.73 22.63 347 0.58(a) 5.23 40 1.16
(0.50) 8.36 (10.41) 1,161 0.39(a) 5.35 29 1.10
(0.04) 9.85 (0.80) 1,085 0.09++ 3.97++ 10 1.21++
$(0.19) $10.22 4.05% $25,438 1.45%++ 3.76%++ 3% 1.74%++
(0.39) 10.01 9.96 25,187 1.42(a) 3.96 20 1.75
(0.02) 9.47 4.06 23,863 1.35(a) 4.20 28 1.69
(0.13) 9.49 (1.12) 28,298 1.35++ 4.11++ 22 1.74++
(0.43) 9.73 21.96 30,048 1.13(a) 4.68 40 1.71
(0.45) 8.36 (10.92) 23,659 0.96(a) 4.78 29 1.67
(0.04) 9.85 (1.11) 11,395 0.69++ 3.37++ 10 1.81++
$(0.19) $10.22 4.05% $ 3 1.45%++ 3.76%++ 3% 1.74%++
(0.40) 10.01 10.07 3 1.33(a) 4.05 20 1.66
(0.02) 9.47 4.32 18 1.10(a) 4.45 28 1.44
(0.14) 9.49 (1.04) 17 1.14++ 4.32++ 22 1.53++
(0.43) 9.73 21.93 2 1.13(a) 4.68 40 1.71
(0.03) 8.36 (0.67) 2 0.96+(a) 4.78++ 29 1.67++
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
137
<PAGE> 142
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS DISTRIBUTIONS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET FROM NET
BEGINNING INVESTMENT GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT REALIZED
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME CAPITAL GAINS
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
SOUTH CAROLINA INTERMEDIATE MUNICIPAL BOND
PRIMARY A SHARES
Six months ended 09/30/1998
(unaudited).......................... $10.79 $0.22 $ 0.16 $ 0.38 $(0.22) $(0.01)
Year ended 03/31/1998.................. 10.50 0.52 0.29 0.81 (0.52) 0.00(c)
Year ended 03/31/1997.................. 10.52 0.51 (0.02) 0.49 (0.51) --
Period ended 03/31/1996(b)............. 10.69 0.17 (0.17) 0.00 (0.17) --
Year ended 11/30/1995.................. 9.76 0.51 0.93 1.44 (0.51) --
Year ended 11/30/1994.................. 10.61 0.50 (0.84) (0.34) (0.50)# (0.01)
Year ended 11/30/1993.................. 10.18 0.50 0.43 0.93 (0.50) --
INVESTOR A SHARES
Six months ended 09/30/1998
(unaudited).......................... $10.79 $0.21 $ 0.16 $ 0.37 $(0.21) $(0.01)
Year ended 03/31/1998.................. 10.50 0.50 0.29 0.79 (0.50) 0.00(c)
Year ended 03/31/1997.................. 10.52 0.49 (0.02) 0.47 (0.49) --
Period ended 03/31/1996(b)............. 10.69 0.16 (0.17) (0.01) (0.16) --
Year ended 11/30/1995.................. 9.76 0.49 0.93 1.42 (0.49) --
Year ended 11/30/1994.................. 10.61 0.48 (0.84) (0.36) (0.48)# (0.01)
Year ended 11/30/1993.................. 10.18 0.48 0.43 0.91 (0.48) --
INVESTOR B SHARES
Six months ended 09/30/1998
(unaudited).......................... $10.79 $0.18 $ 0.16 $ 0.34 $(0.18) $(0.01)
Year ended 03/31/1998.................. 10.50 0.44 0.29 0.73 (0.44) 0.00(c)
Year ended 03/31/1997.................. 10.52 0.45 (0.02) 0.43 (0.45) --
Period ended 03/31/1996(b)............. 10.69 0.15 (0.17) (0.02) (0.15) --
Year ended 11/30/1995.................. 9.76 0.46 0.93 1.39 (0.46) --
Year ended 11/30/1994.................. 10.61 0.45 (0.84) (0.39) (0.45)# (0.01)
Period ended 11/30/1993**.............. 10.47 0.20 0.14 0.34 (0.20) --
INVESTOR C SHARES
Six months ended 09/30/1998
(unaudited).......................... $10.79 $0.18 $ 0.16 $ 0.34 $(0.18) $(0.01)
Year ended 03/31/1998.................. 10.50 0.44 0.29 0.73 (0.44) 0.00(c)
Year ended 03/31/1997.................. 10.52 0.45 (0.02) 0.43 (0.45) --
Period ended 03/31/1996(b)............. 10.69 0.15 (0.17) (0.02) (0.15) --
Year ended 11/30/1995.................. 9.76 0.46 0.93 1.39 (0.46) --
Year ended 11/30/1994.................. 10.61 0.44 (0.84) (0.40) (0.44)# (0.01)
Year ended 11/30/1993.................. 10.18 0.42 0.43 0.85 (0.42) --
</TABLE>
- ---------------
** South Carolina Intermediate Municipal Bond Primary A, Investor A, Investor B
and Investor C Shares commenced operations on January 6, 1992, May 5, 1992,
June 8, 1993 and June 17, 1992, respectively.
++ Annualized.
++++ Total return represents aggregate total return for the period indicated
and does not reflect the deduction of any applicable sales charges.
# Amount includes distributions in excess of net investment income, which were
less than $0.01 per share.
## Amount represents less than $0.01%.
(a) The effect of interest expense on the operating expense ratio was less than
0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
(c) Amount represents less than $0.01 per share.
SEE NOTES TO FINANCIAL STATEMENTS.
138
<PAGE> 143
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
----------------------
RATIO OF RATIO OF RATIO OF
TOTAL NET ASSETS OPERATING NET INVESTMENT OPERATING
DIVIDENDS NET ASSET END OF EXPENSES TO INCOME TO PORTFOLIO EXPENSES TO
AND VALUE TOTAL PERIOD AVERAGE NET AVERAGE NET TURNOVER AVERAGE
DISTRIBUTIONS END OF PERIOD RETURN++++ (IN 000'S) ASSETS ASSETS RATE NET ASSETS
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$(0.23) $10.94 3.95% $246,841 0.50%++(a) 4.76%++ 2% 0.69%++
(0.52) 10.79 7.88 253,090 0.50(a) 4.86 16 0.75
(0.51) 10.50 4.71 48,918 0.50(a) 4.80 13 0.79
(0.17) 10.52 0.00## 41,817 0.50++(a) 4.81++ 6 0.82++
(0.51) 10.69 15.02 45,255 0.55(a) 4.92 11 0.75
(0.51) 9.76 (3.37) 49,030 0.54(a) 4.82 30 0.75
(0.50) 10.61 9.32 56,995 0.45 4.68 11 0.75
$(0.22) $10.94 3.84% $ 17,291 0.70%++(a) 4.56%++ 2% 0.89%++
(0.50) 10.79 7.67 13,945 0.70(a) 4.66 16 0.95
(0.49) 10.51 4.51 10,465 0.70(a) 4.60 13 0.99
(0.16) 10.52 (0.07) 14,288 0.70++(a) 4.61++ 6 1.02++
(0.49) 10.69 14.79 14,452 0.75(a) 4.72 11 0.95
(0.49) 9.76 (3.54) 16,378 0.72(a) 4.64 30 0.93
(0.48) 10.61 9.16 20,024 0.60 4.53 11 0.90
$(0.19) $10.94 3.53% $ 7,097 1.30%++(a) 3.96%++ 2% 1.49%++
(0.44) 10.79 7.13 6,819 1.20(a) 4.16 16 1.45
(0.45) 10.50 4.19 5,738 1.00(a) 4.30 13 1.29
(0.15) 10.52 (0.17) 6,968 1.00++(a) 4.31++ 6 1.32++
(0.46) 10.69 14.45 6,457 1.05(a) 4.42 11 1.25
(0.46) 9.76 (3.85) 5,740 1.04(a) 4.32 30 1.25
(0.20) 10.61 3.23 4,057 0.95++ 4.18++ 11 1.25++
$(0.19) $10.94 3.53% $ 1,691 1.30%++(a) 3.96%++ 2% 1.49%++
(0.44) 10.79 7.13 2,698 1.20(a) 4.16 16 1.45
(0.45) 10.50 4.20 5,089 1.00(a) 4.30 13 1.29
(0.15) 10.52 (0.17) 5,409 1.00++(a) 4.31++ 6 1.32++
(0.46) 10.69 14.45 5,527 1.05(a) 4.42 11 1.25
(0.45) 9.76 (3.94) 6,167 1.12(a) 4.24 30 1.33
(0.42) 10.61 8.51 8,499 1.20 3.93 11 1.50
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
139
<PAGE> 144
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS DISTRIBUTIONS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET FROM NET
BEGINNING INVESTMENT GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT REALIZED
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME CAPITAL GAINS
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
SOUTH CAROLINA MUNICIPAL BOND
PRIMARY A SHARES
Six months ended 09/30/1998
(unaudited).......................... $10.26 $0.20 $ 0.22 $ 0.42 $(0.20) --
Year ended 03/31/1998.................. 9.79 0.49 0.47 0.96 (0.49) $(0.00)#
Year ended 03/31/1997.................. 9.77 0.49 0.02 0.51 (0.49) --
Period ended 03/31/1996(b)............. 9.99 0.17 (0.22) (0.05) (0.17) --
Year ended 11/30/1995.................. 8.65 0.52 1.34 1.86 (0.52) --
Period ended 11/30/1994*............... 10.02 0.48 (1.37) (0.89) (0.48) --
INVESTOR A SHARES
Six months ended 09/30/1998
(unaudited).......................... $10.26 $0.20 $ 0.22 $ 0.42 $(0.20) --
Year ended 03/31/1998.................. 9.79 0.47 0.47 0.94 (0.47) $(0.00)#
Year ended 03/31/1997.................. 9.77 0.47 0.02 0.49 (0.47) --
Period ended 03/31/1996(b)............. 9.99 0.16 (0.22) (0.06) (0.16) --
Year ended 11/30/1995.................. 8.65 0.50 1.34 1.84 (0.50) --
Year ended 11/30/1994.................. 9.86 0.50 (1.21) (0.71) (0.50) --
Period ended 11/30/1993*............... 9.87 0.03 (0.01) 0.02 (0.03) --
INVESTOR B SHARES
Six months ended 09/30/1998
(unaudited).......................... $10.26 $0.17 $ 0.22 $ 0.39 $(0.17) --
Year ended 03/31/1998.................. 9.79 0.40 0.47 0.87 (0.40) $(0.00)#
Year ended 03/31/1997.................. 9.77 0.42 0.02 0.44 (0.42) --
Period ended 03/31/1996(b)............. 9.99 0.14 (0.22) (0.08) (0.14) --
Year ended 11/30/1995.................. 8.65 0.45 1.34 1.79 (0.45) --
Year ended 11/30/1994.................. 9.86 0.45 (1.21) (0.76) (0.45) --
Period ended 11/30/1993*............... 10.00 0.04 (0.14) (0.10) (0.04) --
INVESTOR C SHARES
Six months ended 09/30/1998
(unaudited).......................... $10.26 $0.17 $ 0.22 $ 0.39 $(0.17) --
Year ended 03/31/1998.................. 9.79 0.42 0.47 0.89 (0.42) $(0.00)#
Year ended 03/31/1997.................. 9.77 0.44 0.02 0.46 (0.44) --
Period ended 03/31/1996(b)............. 9.99 0.15 (0.22) (0.07) (0.15) --
Year ended 11/30/1995.................. 8.65 0.45 1.34 1.79 (0.45) --
Period ended 11/30/1994*............... 8.73 0.03 (0.08) (0.05) (0.03) --
</TABLE>
- ---------------
* South Carolina Municipal Bond Primary A, Investor A, Investor B and Investor
C Shares commenced operations on December 27, 1993, November 8, 1993, October
21, 1993 and November 3, 1994, respectively.
++ Annualized.
++++ Total return represents aggregate total return for the period indicated
and does not reflect the deduction of any applicable sales charges.
# Amount represents less than $0.01 per share.
(a) The effect of interest expense on the operating expense ratio was less than
0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
SEE NOTES TO FINANCIAL STATEMENTS.
140
<PAGE> 145
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
----------------------
RATIO OF RATIO OF RATIO OF
TOTAL NET ASSETS OPERATING NET INVESTMENT OPERATING
DIVIDENDS NET ASSET END OF EXPENSES TO INCOME TO PORTFOLIO EXPENSES TO
AND VALUE TOTAL PERIOD AVERAGE NET AVERAGE NET TURNOVER AVERAGE
DISTRIBUTIONS END OF PERIOD RETURN++++ (IN 000'S) ASSETS ASSETS RATE NET ASSETS
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$(0.20) $10.48 4.56% $11,681 0.60%++ 4.67%++ 0% 0.94%++
(0.49) 10.26 10.04 9,455 0.60(a) 4.79 9 0.99
(0.49) 9.79 5.32 5,113 0.60(a) 4.99 30 1.00
(0.17) 9.77 (0.57) 2,058 0.60++(a) 4.96++ 20 1.13++
(0.52) 9.99 21.99 1,782 0.40(a) 5.44 13 1.08
(0.48) 8.65 (9.12) 400 0.21++(a) 5.48++ 14 1.12++
$(0.20) $10.48 4.45% $ 1,107 0.80%++ 4.47%++ 0% 1.14%++
(0.47) 10.26 9.82 1,517 0.80(a) 4.59 9 1.19
(0.47) 9.79 5.12 811 0.80(a) 4.79 30 1.20
(0.16) 9.77 (0.64) 1,219 0.80++(a) 4.76++ 20 1.33++
(0.50) 9.99 21.74 1,238 0.60(a) 5.24 13 1.28
(0.50) 8.65 (7.45) 140 0.39(a) 5.30 14 1.30
(0.03) 9.86 0.21 14 0.10++ 4.16++ 8 1.63++
$(0.17) $10.48 4.12% $10,922 1.45%++ 3.82%++ 0% 1.79%++
(0.40) 10.26 9.15 10,394 1.42(a) 3.97 9 1.81
(0.42) 9.79 4.54 12,104 1.35(a) 4.24 30 1.75
(0.14) 9.77 (0.82) 12,991 1.35++(a) 4.21++ 20 1.88++
(0.45) 9.99 21.08 12,670 1.15(a) 4.69 13 1.83
(0.45) 8.65 (7.97) 8,263 0.96(a) 4.73 14 1.87
(0.04) 9.86 (1.00) 4,048 0.70++ 3.56++ 8 2.23++
$(0.17) $10.48 4.12% $ 42 1.45%++ 3.82%++ 0% 1.79%++
(0.42) 10.26 9.29 28 1.33(a) 4.06 9 1.72
(0.44) 9.79 4.80 247 1.10(a) 4.49 30 1.50
(0.15) 9.77 (0.76) 264 1.17++(a) 4.39++ 20 1.70++
(0.45) 9.99 21.01 20 1.15(a) 4.69 13 1.83
(0.03) 8.65 (0.52) 2 0.96++(a) 4.73++ 14 1.87++
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
141
<PAGE> 146
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS DISTRIBUTIONS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET FROM NET
BEGINNING INVESTMENT GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT REALIZED
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME CAPITAL GAINS
-----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
TENNESSEE INTERMEDIATE MUNICIPAL BOND
PRIMARY A SHARES
Six months ended 09/30/1998
(unaudited)........................ $10.40 $0.24 $ 0.16 $ 0.40 $(0.24) --
Year ended 03/31/1998................ 10.08 0.47 0.32 0.79 (0.47) --
Year ended 03/31/1997................ 10.09 0.46 (0.01) 0.45 (0.46) --
Period ended 03/31/1996(b)........... 10.23 0.15 (0.14) 0.01 (0.15) --
Year ended 11/30/1995................ 9.30 0.46 0.93 1.39 (0.46) --
Year ended 11/30/1994................ 10.18 0.45 (0.87) (0.42) (0.45)# $(0.01)
Period ended 11/30/1993*............. 10.06 0.29 0.12 0.41 (0.29) --
INVESTOR A SHARES
Six months ended 09/30/1998
(unaudited)........................ $10.40 $0.23 $ 0.16 $ 0.39 $(0.23) --
Year ended 03/31/1998................ 10.08 0.45 0.32 0.77 (0.45) --
Year ended 03/31/1997................ 10.09 0.44 (0.01) 0.43 (0.44) --
Period ended 03/31/1996(b)........... 10.23 0.15 (0.14) 0.01 (0.15) --
Year ended 11/30/1995................ 9.30 0.44 0.93 1.37 (0.44) --
Year ended 11/30/1994................ 10.18 0.43 (0.87) (0.44) (0.43)# $(0.01)
Period ended 11/30/1993*............. 10.00 0.29 0.18 0.47 (0.29) --
INVESTOR B SHARES
Six months ended 09/30/1998
(unaudited)........................ $10.40 $0.20 $ 0.16 $ 0.36 $(0.20) --
Year ended 03/31/1998................ 10.08 0.40 0.32 0.72 (0.40) --
Year ended 03/31/1997................ 10.09 0.41 (0.01) 0.40 (0.41) --
Period ended 03/31/1996(b)........... 10.23 0.14 (0.14) 0.00 (0.14) --
Year ended 11/30/1995................ 9.30 0.41 0.93 1.34 (0.41) --
Year ended 11/30/1994................ 10.18 0.40 (0.87) (0.47) (0.40)# $(0.01)
Period ended 11/30/1993*............. 10.03 0.17 0.15 0.32 (0.17) --
INVESTOR C SHARES
Six months ended 09/30/1998
(unaudited)........................ $10.40 $0.19 $ 0.16 $ 0.35 $(0.19) --
Year ended 03/31/1998................ 10.08 0.40 0.32 0.72 (0.40) --
Year ended 03/31/1997................ 10.09 0.42 (0.01) 0.41 (0.42) --
Period ended 03/31/1996(b)........... 10.23 0.14 (0.14) 0.00 (0.14) --
Year ended 11/30/1995................ 9.30 0.41 0.93 1.34 (0.41) --
Period ended 11/30/1994*............. 9.38 0.03 (0.08) (0.05) (0.03) --
</TABLE>
- ---------------
* Tennessee Intermediate Municipal Bond Primary A, Investor A, Investor B and
Investor C Shares commenced operations on April 13, 1993, April 2, 1993, June
10, 1993 and November 3, 1994, respectively.
++ Annualized.
++++ Total return represents aggregate total return for the period indicated
and does not reflect the deduction of any applicable sales charges.
# Amount includes distributions in excess of net investment income, which were
less than $0.01 per share.
(a) The effect of interest expense on the operating expense ratio was less than
0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
SEE NOTES TO FINANCIAL STATEMENTS.
142
<PAGE> 147
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
RATIO OF
OPERATING
EXPENSES TO
RATIO OF AVERAGE NET RATIO OF
TOTAL NET ASSETS OPERATING ASSETS NET INVESTMENT
DIVIDENDS NET ASSET END OF EXPENSES TO INCLUDING INCOME TO PORTFOLIO
AND VALUE TOTAL PERIOD AVERAGE NET INTEREST AVERAGE NET TURNOVER
DISTRIBUTIONS END OF PERIOD RETURN++++ (IN 000'S) ASSETS EXPENSE ASSETS RATE
--------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$(0.24) $10.56 3.87% $40,072 0.50%++ -- 4.53%++ 3%
(0.47) 10.40 7.99 39,091 0.50 (a) 4.58 38
(0.46) 10.08 4.54 8,869 0.50 (a) 4.55 28
(0.15) 10.09 0.12 8,408 0.50++ -- 4.51++ 3
(0.46) 10.23 15.22 7,160 0.57 (a) 4.65 34
(0.46) 9.30 (4.24) 4,116 0.52 0.53% 4.56 41
(0.29) 10.18 4.09 2,123 0.27++ -- 4.31++ 16
$(0.23) $10.56 3.76% $ 8,555 0.70%++ -- 4.33%++ 3%
(0.45) 10.40 7.77 8,061 0.70 (a) 4.38 38
(0.44) 10.08 4.33 6,840 0.70 (a) 4.35 28
(0.15) 10.09 0.06 7,439 0.70++ -- 4.31++ 3
(0.44) 10.23 15.00 7,573 0.77 (a) 4.45 34
(0.44) 9.30 (4.41) 7,831 0.70 0.71% 4.38 41
(0.29) 10.18 4.68 15,573 0.42++ -- 4.16++ 16
$(0.20) $10.56 3.45% $ 2,795 1.30%++ -- 3.73%++ 3%
(0.40) 10.40 7.24 2,924 1.20 (a) 3.88 38
(0.41) 10.08 4.02 3,050 1.00 (a) 4.05 28
(0.14) 10.09 (0.04) 3,528 1.00++ -- 4.01++ 3
(0.41) 10.23 14.65 3,573 1.07 (a) 4.15 34
(0.41) 9.30 (4.72) 3,368 1.02 1.03% 4.06 41
(0.17) 10.18 3.32 2,210 0.77++ -- 3.81++ 16
$(0.19) $10.56 3.41% $ 3 1.30%++ -- 3.73%++ 3%
(0.40) 10.40 7.29 3 1.20 (a) 3.88 38
(0.42) 10.08 4.08 2 1.00 (a) 4.05 28
(0.14) 10.09 (0.02) 2 1.00++ -- 4.01++ 3
(0.41) 10.23 14.62 2 1.07 (a) 4.15 34
(0.03) 9.30 (0.53) 2 1.02++ 1.03%++ 4.06++ 41
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
----------------------
RATIO OF
OPERATING
EXPENSES TO
AVERAGE
NET ASSETS
----------------------
<S> <C>
0.76%++
0.84
0.93
1.02++
0.92
0.89
0.94++
0.96%++
1.04
1.13
1.22++
1.12
1.07
1.09++
1.56%++
1.54
1.43
1.52++
1.42
1.39
1.44++
1.56%++
1.54
1.43
1.52++
1.42
1.39++
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
143
<PAGE> 148
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET
BEGINNING INVESTMENT GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME
-----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
TENNESSEE MUNICIPAL BOND
PRIMARY A SHARES
Six months ended 09/30/1998 (unaudited)............... $10.22 $0.24 $ 0.23 $ 0.47 $(0.24)
Year ended 03/31/1998................................. 9.70 0.48 0.52 1.00 (0.48)
Year ended 03/31/1997................................. 9.68 0.48 0.02 0.50 (0.48)
Period ended 03/31/1996(b)............................ 9.87 0.16 (0.19) (0.03) (0.16)
Year ended 11/30/1995................................. 8.58 0.52 1.29 1.81 (0.52)
Period ended 11/30/1994*.............................. 9.59 0.39 (1.01) (0.62) (0.39)
INVESTOR A SHARES
Six months ended 09/30/1998 (unaudited)............... $10.22 $0.23 $ 0.23 $ 0.46 $(0.23)
Year ended 03/31/1998................................. 9.70 0.46 0.52 0.98 (0.46)
Year ended 03/31/1997................................. 9.68 0.46 0.02 0.48 (0.46)
Period ended 03/31/1996(b)............................ 9.87 0.15 (0.19) (0.04) (0.15)
Year ended 11/30/1995................................. 8.58 0.50 1.29 1.79 (0.50)
Year ended 11/30/1994................................. 9.80 0.50 (1.22) (0.72) (0.50)
Period ended 11/30/1993*.............................. 9.88 0.04 (0.08) (0.04) (0.04)
INVESTOR B SHARES
Six months ended 09/30/1998 (unaudited)............... $10.22 $0.19 $ 0.23 $ 0.42 $(0.19)
Year ended 03/31/1998................................. 9.70 0.40 0.52 0.92 (0.40)
Year ended 03/31/1997................................. 9.68 0.40 0.02 0.42 (0.40)
Period ended 03/31/1996(b)............................ 9.87 0.14 (0.19) (0.05) (0.14)
Year ended 11/30/1995................................. 8.58 0.45 1.29 1.74 (0.45)
Year ended 11/30/1994................................. 9.80 0.45 (1.22) (0.77) (0.45)
Period ended 11/30/1993*.............................. 10.00 0.04 (0.20) (0.16) (0.04)
INVESTOR C SHARES
Six months ended 09/30/1998 (unaudited)............... $10.22 $0.19 $ 0.23 $ 0.42 $(0.19)
Year ended 03/31/1998(c).............................. 9.70 0.40 0.52 0.92 (0.40)
Year ended 03/31/1997................................. 9.68 0.43 0.02 0.45 (0.43)
Period ended 03/31/1996(b)............................ 9.87 0.14 (0.19) (0.05) (0.14)
Year ended 11/30/1995................................. 8.58 0.45 1.29 1.74 (0.45)
Period ended 11/30/1994*.............................. 8.62 0.03 (0.04) (0.01) (0.03)
</TABLE>
- ---------------
* Tennessee Municipal Bond Primary A, Investor A, Investor B and Investor C
Shares commenced operations on March 2, 1994, November 2, 1993, October 21,
1993 and November 3, 1994, respectively.
++ Annualized.
++++ Total return represents aggregate total return for the period indicated
and does not reflect the deduction of any applicable sales charges.
(a) The effect of interest expense on the operating expense ratio was less than
0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
(c) Per share net investment income has been calculated using the monthly
average shares method.
SEE NOTES TO FINANCIAL STATEMENTS.
144
<PAGE> 149
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
RATIO OF
OPERATING
EXPENSES TO
NET ASSETS RATIO OF AVERAGE NET RATIO OF
TOTAL END OF OPERATING ASSETS NET INVESTMENT
DIVIDENDS NET ASSET PERIOD EXPENSES TO INCLUDING INCOME TO PORTFOLIO
AND VALUE TOTAL (IN AVERAGE NET INTEREST AVERAGE NET TURNOVER
DISTRIBUTIONS END OF PERIOD RETURN++++ 000'S) ASSETS EXPENSE ASSETS RATE
--------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$(0.24) $10.45 4.64% $5,235 0.60%++ 0.61%++ 4.64% 17%
(0.48) 10.22 10.45 4,559 0.60 (a) 4.74 19
0.02 9.70 5.23 2,594 0.60 (a) 4.91 31
(0.16) 9.68 (0.30) 975 0.60++ 0.61%++ 4.92++ 2
(0.52) 9.87 21.52 768 0.40 (a) 5.49 45
(0.39) 8.58 (6.66) 311 0.21++ (a) 5.56++ 38
$(0.23) $10.45 4.54% $ 486 0.80%++ 0.81%++ 4.44% 17%
(0.46) 10.22 10.23 1,440 0.80 (a) 4.54 19
0.02 9.70 5.02 1,018 0.80 (a) 4.71 31
(0.15) 9.68 (0.37) 973 0.80++ 0.81%++ 4.72++ 2
(0.50) 9.87 21.28 203 0.60 (a) 5.29 45
(0.50) 8.58 (7.58) 43 0.39 (a) 5.38 38
(0.04) 9.80 (0.43) 34 0.17++ -- 4.31++ 3
$(0.19) $10.45 4.20% $4,766 1.45%++ 1.46%++ 3.79% 17%
(0.40) 10.22 9.56 4,915 1.42 (a) 3.92 19
0.02 9.70 4.45 5,319 1.35 (a) 4.16 31
(0.14) 9.68 (0.55) 6,761 1.35++ 1.36%++ 4.17++ 2
(0.45) 9.87 20.63 6,619 1.15 (a) 4.74 45
(0.45) 8.58 (8.10) 5,504 0.96 (a) 4.81 38
(0.04) 9.80 (1.61) 3,284 0.77++ -- 3.71++ 3
$(0.19) $10.45 4.20% $ 44 1.45%++ 1.46%++ 3.79% 17%
(0.40) 10.22 9.65 42 1.33 (a) 4.01 19
0.02 9.70 4.71 38 1.10 (a) 4.41 31
(0.14) 9.68 (0.49) 37 1.18++ 1.18%++ 4.34++ 2
(0.45) 9.87 20.62 64 1.15 (a) 4.74 45
(0.03) 8.58 (0.07) 2 0.96++ (a) 4.81++ 38
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
----------------------
RATIO OF
OPERATING
EXPENSES TO
AVERAGE
NET ASSETS
----------------------
<S> <C>
1.14%++
1.20
1.24
1.47++
1.27
1.20++
1.34%++
1.40
1.44
1.67++
1.47
1.38
1.86++
1.99%++
2.02
1.99
2.22++
2.02
1.95
2.46++
1.99%++
1.93
1.74
2.05++
2.02
1.95++
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
145
<PAGE> 150
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS DISTRIBUTIONS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET FROM NET
BEGINNING INVESTMENT GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT REALIZED
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME CAPITAL GAINS
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
TEXAS INTERMEDIATE MUNICIPAL BOND
PRIMARY A SHARES
Six months ended 09/30/1998
(unaudited)...................... $10.50 $0.25 $ 0.15 $ 0.40 $(0.25) --
Year ended 03/31/1998.............. 10.18 0.49 0.32 0.81 (0.49) --
Year ended 03/31/1997.............. 10.21 0.47 (0.03) 0.44 (0.47) --
Period ended 03/31/1996(b)......... 10.36 0.16 (0.15) 0.01 (0.16) --
Year ended 11/30/1995.............. 9.53 0.46 0.83 1.29 (0.46) --
Year ended 11/30/1994.............. 10.35 0.44 (0.79) (0.35) (0.44)# $(0.03)
Period ended 11/30/1993*........... 10.00 0.41 0.35 0.76 (0.41) --
INVESTOR A SHARES
Six months ended 09/30/1998
(unaudited)...................... $10.50 $0.24 $ 0.15 $ 0.39 $(0.24) --
Year ended 03/31/1998.............. 10.18 0.47 0.32 0.79 (0.47) --
Year ended 03/31/1997.............. 10.21 0.45 (0.03) 0.42 (0.45) --
Period ended 03/31/1996(b)......... 10.36 0.15 (0.15) 0.00 (0.15) --
Year ended 11/30/1995.............. 9.53 0.44 0.83 1.27 (0.44) --
Year ended 11/30/1994.............. 10.35 0.42 (0.79) (0.37) (0.42)# $(0.03)
Period ended 11/30/1993*........... 10.15 0.37 0.20 0.57 (0.37) --
INVESTOR B SHARES
Six months ended 09/30/1998
(unaudited)...................... $10.50 $0.21 $ 0.15 $ 0.36 $(0.21) --
Year ended 03/31/1998.............. 10.18 0.42 0.32 0.74 (0.42) --
Year ended 03/31/1997.............. 10.21 0.42 (0.03) 0.39 (0.42) --
Period ended 03/31/1996(b)......... 10.36 0.14 (0.15) (0.01) (0.14) --
Year ended 11/30/1995.............. 9.53 0.41 0.83 1.24 (0.41) --
Year ended 11/30/1994.............. 10.35 0.39 (0.79) (0.40) (0.39)# $(0.03)
Period ended 11/30/1993*........... 10.25 0.17 0.10 0.27 (0.17) --
INVESTOR C SHARES
Six months ended 09/30/1998
(unaudited)...................... $10.50 $0.21 $ 0.15 $ 0.36 $(0.21) --
Year ended 03/31/1998.............. 10.18 0.42 0.32 0.74 (0.42) --
Year ended 03/31/1997.............. 10.21 0.42 (0.03) 0.39 (0.42) --
Period ended 03/31/1996(b)......... 10.36 0.14 (0.15) (0.01) (0.14) --
Year ended 11/30/1995.............. 9.53 0.41 0.83 1.24 (0.41) --
Period ended 11/30/1994*........... 9.55 0.03 (0.02) 0.01 (0.03)# --
</TABLE>
- ---------------
* Texas Intermediate Municipal Bond Primary A, Investor A, Investor B and
Investor C Shares commenced operations on January 12, 1993, February 4, 1993,
June 22, 1993 and November 3, 1994, respectively.
+ Annualized.
++ Total return represents aggregate total return for the period indicated and
does not reflect the deduction of any applicable sales charges.
# Amount includes distributions in excess of net investment income, which were
less than $0.01 per share.
(a) The effect of interest expense on the operating expense ratio was less than
0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
SEE NOTES TO FINANCIAL STATEMENTS.
146
<PAGE> 151
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
----------------------
RATIO OF RATIO OF RATIO OF
TOTAL NET ASSET NET ASSETS OPERATING NET INVESTMENT OPERATING
DIVIDENDS VALUE END OF EXPENSES TO INCOME TO PORTFOLIO EXPENSES TO
AND END OF TOTAL PERIOD AVERAGE NET AVERAGE NET TURNOVER AVERAGE NET
DISTRIBUTIONS PERIOD RETURN++ (IN 000'S) ASSETS ASSETS RATE ASSETS
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$(0.25) $10.65 3.85% $392,642 0.50%+(a) 4.71%+ 8% 0.68%+
(0.49) 10.50 8.09 385,770 0.50 4.74 19 0.75
(0.47) 10.18 4.37 24,764 0.50 4.59 34 0.84
(0.16) 10.21 0.05 27,176 0.50+ 4.52+ 11 0.89+
(0.46) 10.36 13.83 26,382 0.57(a) 4.62 64 0.83
(0.47) 9.53 (3.48) 24,066 0.55(a) 4.40 61 0.78
(0.41) 10.35 7.72 31,875 0.44+ 4.43+ 63 0.82+
$(0.24) $10.65 3.74% $ 3,605 0.70%+(a) 4.51%+ 8% 0.88%+
(0.47) 10.50 7.87 2,666 0.70 4.54 19 0.95
(0.45) 10.18 4.17 909 0.70 4.39 34 1.04
(0.15) 10.21 (0.02) 801 0.70+ 4.32+ 11 1.09+
(0.44) 10.36 13.60 806 0.77(a) 4.42 64 1.03
(0.45) 9.53 (3.66) 718 0.73(a) 4.22 61 0.96
(0.37) 10.35 5.64 968 0.59+ 4.28+ 63 0.97+
$(0.21) $10.65 3.43% $ 2,192 1.30%+(a) 3.91%+ 8% 1.48%+
(0.42) 10.50 7.34 2,184 1.20 4.04 19 1.45
(0.42) 10.18 3.87 2,182 1.00 4.09 34 1.34
(0.14) 10.21 (0.12) 2,845 1.00+ 4.02+ 11 1.39+
(0.41) 10.36 13.27 3,136 1.07(a) 4.12 64 1.33
(0.42) 9.53 (3.96) 2,774 1.05(a) 3.90 61 1.28
(0.17) 10.35 2.61 1,330 0.94+ 3.93+ 63 1.32+
$(0.21) $10.65 3.43% $ 134 1.30%+(a) 3.91%+ 8% 1.48%+
(0.42) 10.50 7.34 293 1.20 4.04 19 1.45
(0.42) 10.18 3.87 591 1.00 4.09 34 1.34
(0.14) 10.21 (0.12) 569 1.00+ 4.02+ 11 1.39+
(0.41) 10.36 13.27 570 1.07(a) 4.12 64 1.33
(0.03) 9.53 0.08 2 1.05+(a) 3.90+ 61 1.28+
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
147
<PAGE> 152
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET
BEGINNING INVESTMENT GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME
-------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
TEXAS MUNICIPAL BOND
PRIMARY A SHARES
Six months ended 09/30/1998 (unaudited)............... $10.04 $0.23 $ 0.20 $ 0.43 $(0.23)
Year ended 03/31/1998(c).............................. 9.48 0.48 0.56 1.04 (0.48)
Year ended 03/31/1997................................. 9.49 0.48 (0.01) 0.47 (0.48)
Period ended 03/31/1996(b)............................ 9.70 0.16 (0.21) (0.05) (0.16)
Year ended 11/30/1995................................. 8.39 0.50 1.31 1.81 (0.50)
Period ended 11/30/1994*.............................. 10.01 0.42 (1.62) (1.20) (0.42)
INVESTOR A SHARES
Six months ended 09/30/1998 (unaudited)............... $10.04 $0.22 $ 0.20 $ 0.42 $(0.22)
Year ended 03/31/1998(c).............................. 9.48 0.46 0.56 1.02 (0.46)
Year ended 03/31/1997................................. 9.49 0.46 (0.01) 0.45 (0.46)
Period ended 03/31/1996(b)............................ 9.70 0.15 (0.21) (0.06) (0.15)
Year ended 11/30/1995................................. 8.39 0.49 1.31 1.80 (0.49)
Period ended 11/30/1994*.............................. 9.92 0.47 (1.53) (1.06) (0.47)
INVESTOR B SHARES
Six months ended 09/30/1998 (unaudited)............... $10.04 $0.19 $ 0.20 $ 0.39 $(0.19)
Year ended 03/31/1998(c).............................. 9.48 0.39 0.56 0.95 (0.39)
Year ended 03/31/1997................................. 9.49 0.40 (0.01) 0.39 (0.40)
Period ended 03/31/1996(b)............................ 9.70 0.13 (0.21) (0.08) (0.13)
Year ended 11/30/1995................................. 8.39 0.43 1.31 1.74 (0.43)
Year ended 11/30/1994................................. 9.78 0.44 (1.39) (0.95) (0.44)
Period ended 11/30/1993*.............................. 10.00 0.04 (0.22) (0.18) (0.04)
INVESTOR C SHARES
Six months ended 09/30/1998 (unaudited)............... $10.04 $0.19 $ 0.20 $ 0.39 $(0.19)
Year ended 03/31/1998(c).............................. 9.48 0.40 0.56 0.96 (0.40)
Year ended 03/31/1997................................. 9.49 0.43 (0.01) 0.42 (0.43)
Period ended 03/31/1996(b)............................ 9.70 0.14 (0.21) (0.07) (0.14)
Year ended 11/30/1995................................. 8.39 0.43 1.31 1.74 (0.43)
Period ended 11/30/1994*.............................. 8.46 0.03 (0.07) (0.04) (0.03)
</TABLE>
- ---------------
* Texas Municipal Bond Primary A, Investor A, Investor B and Investor C Shares
commenced operations on February 3, 1994, December 17, 1993, October 21, 1993
and November 3, 1994, respectively.
+ Annualized.
++ Total return represents aggregate total return for the period indicated and
does not reflect the deduction of any applicable sales charges.
(a) The effect of interest expense on the operating expense ratio was less than
0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
(c) Per share net investment income has been calculated using the monthly
average shares method.
SEE NOTES TO FINANCIAL STATEMENTS.
148
<PAGE> 153
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
RATIO OF ----------------------
OPERATING RATIO OF RATIO OF
TOTAL NET ASSET NET ASSETS EXPENSES TO NET INVESTMENT OPERATING
DIVIDENDS VALUE END OF AVERAGE INCOME TO PORTFOLIO EXPENSES TO
AND END OF TOTAL PERIOD NET AVERAGE NET TURNOVER AVERAGE NET
DISTRIBUTIONS PERIOD RETURN++ (IN 000'S) ASSETS ASSETS RATE ASSETS
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$(0.23) $10.24 4.37% $ 8,622 0.60%+(a) 4.63%+ 9% 1.02%+
(0.48) 10.04 11.12 7,615 0.60(a) 4.83 33 1.07
(0.48) 9.48 5.00 5,675 0.60(a) 4.99 52 1.03
(0.16) 9.49 (0.55) 5,138 0.60+ 4.92+ 6 1.11+
(0.50) 9.70 22.09 4,613 0.39(a) 5.45 50 1.05
(0.42) 8.39 (12.21) 2,285 0.22+(a) 5.52+ 107 1.06+
$(0.22) $10.24 4.27% $ 436 0.80%+(a) 4.43%+ 9% 1.22%+
(0.46) 10.04 10.90 419 0.80(a) 4.63 33 1.27
(0.46) 9.48 4.78 371 0.80(a) 4.79 52 1.23
(0.15) 9.49 (0.62) 317 0.80+ 4.72+ 6 1.31+
(0.49) 9.70 21.85 351 0.59(a) 5.25 50 1.25
(0.47) 8.39 (10.98) 55 0.40+(a) 5.34+ 107 1.24+
$(0.19) $10.24 3.94% $ 7,726 1.45%+(a) 3.78%+ 9% 1.87%+
(0.39) 10.04 10.23 8,804 1.42(a) 4.01 33 1.89
(0.40) 9.48 4.21 10,090 1.35(a) 4.24 52 1.78
(0.13) 9.49 (0.80) 11,838 1.35+ 4.17+ 6 1.86+
(0.43) 9.70 21.19 12,587 1.14(a) 4.70 50 1.80
(0.44) 8.39 (9.98) 10,812 0.97(a) 4.77 107 1.81
(0.04) 9.78 (1.82) 6,154 0.70+ 3.32+ 5 2.05+
$(0.19) $10.24 3.94% $ 84 1.45%+(a) 3.78%+ 9% 1.87%+
(0.40) 10.04 10.31 80 1.33(a) 4.10 33 1.80
(0.43) 9.48 4.47 73 1.10(a) 4.49 52 1.53
(0.14) 9.49 (0.74) 70 1.16+ 4.36+ 6 1.67+
(0.43) 9.70 21.15 70 1.14(a) 4.70 50 1.80
(0.03) 8.39 (0.43) 2 0.97+(a) 4.77+ 107 1.81+
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
149
<PAGE> 154
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS DISTRIBUTIONS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET FROM NET
BEGINNING INVESTMENT GAIN (LOSS) ON NET ASSET VALUE INVESTMENT REALIZED
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME CAPITAL GAINS
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
VIRGINIA INTERMEDIATE MUNICIPAL BOND
PRIMARY A SHARES
Six months ended 09/30/1998
(unaudited)......................... $10.92 $0.25 $ 0.18 $ 0.43 $(0.25) --
Year ended 03/31/1998................. 10.59 0.51 0.33 0.84 (0.51) --
Year ended 03/31/1997................. 10.69 0.51 (0.10) 0.41 (0.51) --
Period ended 03/31/1996(b)............ 10.83 0.17 (0.14) 0.03 (0.17) --
Year ended 11/30/1995................. 9.94 0.51 0.89 1.40 (0.51) $(0.00)#
Year ended 11/30/1994................. 10.99 0.50 (0.96) (0.46) (0.50) (0.09)
Year ended 11/30/1993................. 10.59 0.48 0.42 0.90 (0.48) (0.02)
INVESTOR A SHARES
Six months ended 09/30/1998
(unaudited)......................... $10.92 $0.24 $ 0.18 $ 0.42 $(0.24) --
Year ended 03/31/1998................. 10.59 0.49 0.33 0.82 (0.49) --
Year ended 03/31/1997................. 10.69 0.49 (0.10) 0.39 (0.49) --
Period ended 03/31/1996(b)............ 10.83 0.16 (0.14) 0.02 (0.16) --
Year ended 11/30/1995................. 9.94 0.49 0.89 1.38 (0.49) $(0.00)#
Year ended 11/30/1994................. 10.99 0.48 (0.96) (0.48) (0.48) (0.09)
Year ended 11/30/1993................. 10.59 0.51 0.42 0.93 (0.51) (0.02)
INVESTOR B SHARES
Six months ended 09/30/1998
(unaudited)......................... $10.92 $0.21 $ 0.18 $ 0.39 $(0.21) --
Year ended 03/31/1998(c).............. 10.59 0.44 0.33 0.77 (0.44) --
Year ended 03/31/1997................. 10.69 0.46 (0.10) 0.36 (0.46) --
Period ended 03/31/1996(b)............ 10.83 0.15 (0.14) 0.01 (0.15) --
Year ended 11/30/1995................. 9.94 0.46 0.89 1.35 (0.46) $(0.00)#
Year ended 11/30/1994................. 10.99 0.45 (0.96) (0.51) (0.45) (0.09)
Period ended 11/30/1993**............. 10.83 0.21 0.16 0.37 (0.21) --
INVESTOR C SHARES
Six months ended 09/30/1998
(unaudited)......................... $10.92 $0.21 $ 0.18 $ 0.39 $(0.21) --
Year ended 03/31/1998(c).............. 10.59 0.44 0.33 0.77 (0.44) --
Year ended 03/31/1997................. 10.69 0.46 (0.10) 0.36 (0.46) --
Period ended 03/31/1996(b)............ 10.83 0.15 (0.14) 0.01 (0.15) --
Year ended 11/30/1995................. 9.94 0.46 0.89 1.35 (0.46) $(0.00)#
Year ended 11/30/1994................. 10.99 0.44 (0.96) (0.52) (0.44) (0.09)
Year ended 11/30/1993................. 10.59 0.44 0.42 0.86 (0.44) (0.02)
<CAPTION>
DISTRIBUTIONS
IN EXCESS OF
NET REALIZED
CAPITAL GAINS
-------------
<S> <C>
VIRGINIA INTERMEDIATE MUNICIPAL BOND
PRIMARY A SHARES
Six months ended 09/30/1998
(unaudited)......................... --
Year ended 03/31/1998................. --
Year ended 03/31/1997................. --
Period ended 03/31/1996(b)............ --
Year ended 11/30/1995................. --
Year ended 11/30/1994................. $(0.00)#
Year ended 11/30/1993................. --
INVESTOR A SHARES
Six months ended 09/30/1998
(unaudited)......................... --
Year ended 03/31/1998................. --
Year ended 03/31/1997................. --
Period ended 03/31/1996(b)............ --
Year ended 11/30/1995................. --
Year ended 11/30/1994................. $(0.00)#
Year ended 11/30/1993................. --
INVESTOR B SHARES
Six months ended 09/30/1998
(unaudited)......................... --
Year ended 03/31/1998(c).............. --
Year ended 03/31/1997................. --
Period ended 03/31/1996(b)............ --
Year ended 11/30/1995................. --
Year ended 11/30/1994................. $(0.00)#
Period ended 11/30/1993**............. --
INVESTOR C SHARES
Six months ended 09/30/1998
(unaudited)......................... --
Year ended 03/31/1998(c).............. --
Year ended 03/31/1997................. --
Period ended 03/31/1996(b)............ --
Year ended 11/30/1995................. --
Year ended 11/30/1994................. $(0.00)#
Year ended 11/30/1993................. --
</TABLE>
- ---------------
* Virginia Intermediate Municipal Bond Primary A, Investor A, Investor B and
Investor C Shares commenced operations on September 20, 1989, December 5,
1989, June 7, 1993 and June 17, 1992, 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 $0.01 per share.
(a) The effect of interest expense on the operating expense ratio was less than
0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
(c) Per share net investment income has been calculated using the monthly
average shares method.
SEE NOTES TO FINANCIAL STATEMENTS.
150
<PAGE> 155
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
WITHOUT WAIVERS AND/OR
EXPENSE REIMBURSEMENTS
----------------------
RATIO OF RATIO OF RATIO OF
TOTAL NET ASSETS OPERATING NET INVESTMENT OPERATING
DIVIDENDS NET ASSET END OF EXPENSES TO INCOME TO PORTFOLIO EXPENSES TO
AND VALUE TOTAL PERIOD AVERAGE NET AVERAGE NET TURNOVER AVERAGE
DISTRIBUTIONS END OF PERIOD RETURN++ (IN 000'S) ASSETS ASSETS RATE NET ASSETS
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$(0.25) $11.10 4.02% $203,241 0.50%+(a) 4.61%+ 2% 0.71%+
(0.51) 10.92 8.12 170,969 0.50(a) 4.77 21 0.74
(0.51) 10.59 3.92 148,701 0.50(a) 4.79 20 0.74
(0.17) 10.69 0.27 155,464 0.50+(a) 4.72+ 2 0.76+
(0.51) 10.83 14.39 157,252 0.56(a) 4.87 22 0.74
(0.59) 9.94 (4.35) 167,405 0.61(a) 4.76 14 0.73
(0.50) 10.99 9.08 193,084 0.57 4.80 26 0.69
$(0.24) $11.10 3.91% $ 54,614 0.70%+(a) 4.41%+ 2% 0.91%+
(0.49) 10.92 7.91 54,080 0.70(a) 4.57 21 0.94
(0.49) 10.59 3.71 55,791 0.70(a) 4.59 20 0.94
(0.16) 10.69 0.20 68,003 0.70+(a) 4.52+ 2 0.96+
(0.49) 10.83 14.16 73,253 0.76(a) 4.67 22 0.94
(0.57) 9.94 (4.52) 79,412 0.79(a) 4.58 14 0.91
(0.53) 10.99 8.91 103,689 0.72 4.65 26 0.84
$(0.21) $11.10 3.60% $ 10,430 1.30%+(a) 3.81%+ 2% 1.51%+
(0.44) 10.92 7.37 9,643 1.20(a) 4.07 21 1.44
(0.46) 10.59 3.40 10,516 1.00(a) 4.29 20 1.24
(0.15) 10.69 0.10 11,926 1.00+(a) 4.22+ 2 1.26+
(0.46) 10.83 13.82 12,163 1.06(a) 4.37 22 1.24
(0.54) 9.94 (4.82) 9,690 1.11(a) 4.26 14 1.23
(0.21) 10.99 3.48 5,249 1.07+ 4.30+ 26 1.19+
$(0.21) $11.10 3.60% $ 1,212 1.30%+(a) 3.81%+ 2% 1.51%+
(0.44) 10.92 7.37 1,949 1.20(a) 4.07 21 1.44
(0.46) 10.59 3.40 6,463 1.00(a) 4.29 20 1.24
(0.15) 10.69 0.10 6,909 1.00+(a) 4.22+ 2 1.26+
(0.46) 10.83 13.82 7,152 1.06(a) 4.37 22 1.24
(0.53) 9.94 (4.90) 8,372 1.19(a) 4.18 14 1.31
(0.46) 10.99 8.25 11,176 1.32 4.05 26 1.44
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
151
<PAGE> 156
NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD.
<TABLE>
<CAPTION>
NET ASSET NET REALIZED NET INCREASE/ DIVIDENDS
VALUE NET AND UNREALIZED (DECREASE) IN FROM NET
BEGINNING INVESTMENT GAIN/(LOSS) ON NET ASSET VALUE INVESTMENT
OF PERIOD INCOME INVESTMENTS FROM OPERATIONS INCOME
--------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
VIRGINIA MUNICIPAL BOND
PRIMARY A SHARES
Six months ended 09/30/1998 (unaudited)........... $ 9.95 $0.23 $ 0.22 $ 0.45 $(0.23)
Year ended 03/31/1998............................. 9.40 0.47 0.55 1.02 (0.47)
Year ended 03/31/1997............................. 9.38 0.48 0.02 0.50 (0.48)
Period ended 03/31/1996(b)........................ 9.62 0.16 (0.24) (0.08) (0.16)
Year ended 11/30/1995............................. 8.29 0.51 1.33 1.84 (0.51)
Period ended 11/30/1994*.......................... 10.00 0.45 (1.71) (1.26) (0.45)
INVESTOR A SHARES
Six months ended 09/30/1998 (unaudited)........... $ 9.95 $0.22 $ 0.22 $ 0.44 $(0.22)
Year ended 03/31/1998(c).......................... 9.40 0.45 0.55 1.00 (0.45)
Year ended 03/31/1997............................. 9.38 0.46 0.02 0.48 (0.46)
Period ended 03/31/1996(b)........................ 9.62 0.16 (0.24) (0.08) (0.16)
Year ended 11/30/1995............................. 8.29 0.49 1.33 1.82 (0.49)
Year ended 11/30/1994............................. 9.77 0.49 (1.48) (0.99) (0.49)
Period ended 11/30/1993*.......................... 9.84 0.03 (0.07) (0.04) (0.03)
INVESTOR B SHARES
Six months ended 09/30/1998 (unaudited)........... $ 9.95 $0.19 $ 0.22 $ 0.41 $(0.19)
Year ended 03/31/1998(c).......................... 9.40 0.39 0.55 0.94 (0.39)
Year ended 03/31/1997............................. 9.38 0.41 0.02 0.43 (0.41)
Period ended 03/31/1996(b)........................ 9.62 0.14 (0.24) (0.10) (0.14)
Year ended 11/30/1995............................. 8.29 0.44 1.33 1.77 (0.44)
Year ended 11/30/1994............................. 9.77 0.44 (1.48) (1.04) (0.44)
Period ended 11/30/1993*.......................... 10.00 0.04 (0.23) (0.19) (0.04)
INVESTOR C SHARES
Six months ended 09/30/1998 (unaudited)........... $ 9.95 $0.19 $ 0.22 $ 0.41 $(0.19)
Year ended 03/31/1998(c).......................... 9.40 0.40 0.55 0.95 (0.40)
Year ended 03/31/1997............................. 9.38 0.43 0.02 0.45 (0.43)
Period ended 03/31/1996(b)........................ 9.62 0.14 (0.24) (0.10) (0.14)
Year ended 11/30/1995............................. 8.29 0.44 1.33 1.77 (0.44)
Period ended 11/30/1994*.......................... 8.38 0.03 (0.09) (0.06) (0.03)
</TABLE>
- ---------------
* Virginia Municipal Bond Primary A, Investor A, Investor B and Investor C
Shares commenced operations on January 11, 1994, November 8, 1993, October
21, 1993 and November 3, 1994, respectively.
+ Annualized.
++ Total return represents aggregate total return for the period indicated and
does not reflect the deduction of any applicable sales charges.
(a) The effect of interest expense on the operating expense ratio was less than
0.01%.
(b) Fiscal year end changed to March 31. Prior to this, the fiscal year end was
November 30.
(c) Per share net investment income has been calculated using the monthly
average shares method.
SEE NOTES TO FINANCIAL STATEMENTS.
152
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NATIONS FUNDS
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
<TABLE>
<CAPTION>
RATIO OF WITHOUT WAIVERS AND/OR
OPERATING EXPENSE REIMBURSEMENTS
EXPENSES TO ----------------------
RATIO OF AVERAGE NET RATIO OF RATIO OF
TOTAL NET ASSET NET ASSETS OPERATING ASSETS NET INVESTMENT OPERATING
DIVIDENDS VALUE END OF EXPENSES TO INCLUDING INCOME TO PORTFOLIO EXPENSES TO
AND END OF TOTAL PERIOD AVERAGE NET INTEREST AVERAGE NET TURNOVER AVERAGE
DISTRIBUTIONS PERIOD RETURN++ (IN 000'S) ASSETS EXPENSE ASSETS RATE NET ASSETS
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$(0.23) $ 10.17 4.61% $13,386 0.60%+ (a) 4.65%+ 2% 0.92%+
(0.47) 9.95 11.11 11,026 0.59 (a) 4.86 9 0.96
(0.48) 9.40 5.44 5,726 0.60 (a) 5.10 37 0.98
(0.16) 9.38 (0.84) 3,296 0.60+ 0.61%+ 5.06+ 8 1.07+
(0.51) 9.62 22.63 3,527 0.39 (a) 5.51 16 1.04
(0.45) 8.29 (12.86) 432 0.21+ (a) 5.52+ 61 0.99+
$ (0.22) $ 10.17 4.51% $ 1,290 0.80%+ (a) 4.45%+ 2% 1.12%+
(0.45) 9.95 10.88 1,222 0.79 (a) 4.66 9 1.16
(0.46) 9.40 5.23 726 0.80 (a) 4.90 37 1.18
(0.16) 9.38 (0.91) 661 0.80+ 0.81%+ 4.86+ 8 1.27+
(0.49) 9.62 22.39 650 0.59 (a) 5.31 16 1.24
(0.49) 8.29 (10.44) 168 0.39 (a) 5.34 61 1.17
(0.03) 9.77 (0.42) 25 0.10+ -- 3.88+ 0 1.30+
$ (0.19) $ 10.17 4.17% $13,692 1.45%+ (a) 3.80%+ 2% 1.77%+
(0.39) 9.95 10.21 13,082 1.41 (a) 4.04 9 1.78
(0.41) 9.40 4.65 13,972 1.35 (a) 4.35 37 1.73
(0.14) 9.38 (1.09) 15,938 1.35+ 1.36%+ 4.31+ 8 1.82+
(0.44) 9.62 21.72 16,489 1.14 (a) 4.76 16 1.79
(0.44) 8.29 (10.95) 12,738 0.96 (a) 4.77 61 1.74
(0.04) 9.77 (1.93) 6,580 0.70+ -- 3.28+ 0 1.90+
$ (0.19) $ 10.17 4.13% $ 3 1.45%+ (a) 3.80%+ 2% 1.77%+
(0.40) 9.95 10.31 3 1.32 (a) 4.13 9 1.69
(0.43) 9.40 4.92 45 1.10 (a) 4.60 37 1.48
(0.14) 9.38 (1.03) 43 1.16+ 1.17%+ 4.50+ 8 1.63+
(0.44) 9.62 21.71 34 1.14 (a) 4.76 16 1.79
(0.03) 8.29 (0.67) 2 0.96+ (a) 4.77+ 61 1.74+
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
153
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- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
Nations Fund Trust (the "Trust") is registered under the Investment Company Act
of 1940, as amended (the "1940 Act"), as an open-end investment company. At
September 30, 1998, the Trust offered thirty-seven separate portfolios. These
financial statements pertain only to the municipal bond portfolios of the Trust
(each a "Fund" and collectively, the "Funds"). Financial statements for the
other portfolios of the Trust are presented under separate cover. The Funds
currently offer four classes of shares: Primary A Shares, Investor A Shares,
Investor B Shares and Investor C 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 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: Securities are valued by an independent pricing service
approved by the Board of Trustees. Valuations are based upon a matrix system
and/or appraisals provided by the pricing service which takes into consideration
such factors as yields, prices, maturities, redemption features and credit
ratings on comparable securities. Certain securities may be valued by one or
more principal market makers. Restricted securities, securities for which market
quotations are not readily available, and other assets are valued by the
investment advisor under the supervision of the Board of Trustees. Short-term
investments that mature in 60 days or less are valued at amortized cost.
Certain state's municipal obligations may be obligations of issuers that rely in
whole or in part on state specific revenues, real property taxes and revenues
from health care institutions, as appropriate, or obligations secured by
mortgages on real property. Consequently, state law affecting these obligations
and the possible effects on these obligations of economic conditions in such
states must be considered.
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 securities sold. Interest income, adjusted for
accretion of discounts and amortization of premiums, is earned from settlement
date and recorded on the accrual basis. Dividend income is recorded on
ex-dividend date. Each Fund's investment income and realized and unrealized
gains and losses are allocated among its classes based upon the relative net
assets of each class of shares.
Securities purchased or sold on a when-issued or delayed-delivery basis may be
settled a month or more after trade date; interest income is not accrued until
settlement date.
Dividends and Distributions to Shareholders: It is the policy of each Fund to
declare dividends daily from net investment income and pay such dividends
monthly. Each Fund will distribute net realized capital gains annually after the
fiscal year in which the capital gains were earned, unless offset by any
available capital loss carryforward. 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.
Federal Income Tax: Each Fund intends to continue to qualify as a regulated
investment company by complying with the applicable requirements of the Internal
Revenue Code of 1986, as amended, and by distributing substantially all of its
earnings to shareholders. Therefore, no provision is made for Federal income or
excise taxes.
Expenses: General expenses of the Trust are allocated to the Funds based upon
relative net assets. Expenses directly attributable to a Fund or class of shares
are charged to such Fund or class. Expenses not directly attributable to any
class of shares are prorated based on the relative net assets of each class. The
Funds bear all costs in connection with their organization, including the fees
and expenses of registering and qualifying their shares for distribution
154
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- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
under Federal and state securities regulations. All such costs are being
amortized on a straight-line basis over a period of five years from commencement
of operations.
2. INVESTMENT ADVISORY FEE, SUB-ADVISORY FEE, ADMINISTRATION FEE AND RELATED
PARTY TRANSACTIONS
The Trust has entered into an investment advisory agreement (the "Investment
Advisory Agreement") 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 this Investment Advisory
Agreement, NBAI is entitled to receive an advisory fee calculated daily and
payable monthly based on the following annual rates multiplied by the average
daily net assets of each Fund:
<TABLE>
<CAPTION>
ANNUAL
RATE
------
<S> <C>
Short-Term Municipal Income, Intermediate Municipal Bond and
eight single-state Intermediate Municipal Bond Funds....... 0.50%
Municipal Income and eight single-state Municipal Bond
Funds...................................................... 0.60%
</TABLE>
The Trust has entered into a sub-advisory agreement with NBAI and TradeStreet
Investment Associates, Inc. ("TradeStreet"), a wholly-owned subsidiary of
NationsBank, pursuant to which TradeStreet is entitled to receive a sub-advisory
fee from NBAI at the annual rate of 0.07% of each Fund's average daily net
assets.
Stephens, Inc. ("Stephens") serves as the administrator of the Trust. First Data
Investor Services Group, Inc. ("First Data"), a wholly-owned subsidiary of First
Data Corporation, serves as co-administrator. Stephens and First Data are
entitled to receive a combined fee, computed daily and paid monthly, at the
annual rate of 0.10% of average daily net assets of each fund. NBAI is the
sub-administrator of the Trust pursuant to an agreement with Stephens. For the
six months ended September 30, 1998, Stephens earned $745,000 from the Funds for
its administration services, of which $180,000 was paid to NBAI for its services
as sub-administrator.
NationsBank of Texas, N.A. ("NationsBank of Texas") served as the custodian of
the Trust's assets until it merged with NationsBank on May 6, 1998. NationsBank
began serving as custodian for the Trust's assets on that date and is providing
the same services as were previously provided by NationsBank of Texas. For the
six months ended September 30, 1998, NationsBank of Texas and NationsBank earned
$12,000 and $46,000, respectively, for providing such services. The Bank of New
York ("BNY") has entered into agreements with each of the Funds and NationsBank
whereby BNY serves as sub-custodian for the Funds.
155
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NATIONS FUNDS
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
The investment advisor, sub-advisor, administrator and custodian may, from time
to time, voluntarily reduce their fees payable by each Fund. For the six months
ended September 30, 1998, fee waivers and expense reimbursements were as
follows:
<TABLE>
<CAPTION>
FEES WAIVED BY
------------------------
ADVISOR ADMINISTRATOR
------------------------
<S> <C> <C>
Short-Term Municipal Income................................. $193,000 $11,000
Intermediate Municipal Bond................................. $715,000 $90,000
Municipal Income............................................ $528,000 $59,000
Florida Intermediate Municipal Bond......................... $198,000 $22,000
Florida Municipal Bond...................................... $126,000 $14,000
Georgia Intermediate Municipal Bond......................... $136,000 $15,000
Georgia Municipal Bond...................................... $ 34,000 $ 2,000
Maryland Intermediate Municipal Bond........................ $168,000 $16,000
Maryland Municipal Bond..................................... $ 45,000 $ 3,000
North Carolina Intermediate Municipal Bond.................. $168,000 $20,000
North Carolina Municipal Bond............................... $ 48,000 $ 4,000
South Carolina Intermediate Municipal Bond.................. $231,000 $27,000
South Carolina Municipal Bond............................... $ 36,000 $ 2,000
Tennessee Intermediate Municipal Bond....................... $ 60,000 $ 5,000
Tennessee Municipal Bond.................................... $ 28,000 $ 1,000
Texas Intermediate Municipal Bond........................... $310,000 $39,000
Texas Municipal Bond........................................ $ 34,000 $ 2,000
Virginia Intermediate Municipal Bond........................ $234,000 $25,000
Virginia Municipal Bond..................................... $ 41,000 $ 3,000
</TABLE>
First Data also serves as the transfer agent for the Funds' shares. NationsBank
of Texas also served as the sub-transfer agent for the Primary A Shares of the
Funds until it merged with NationsBank on May 6, 1998. NationsBank began serving
as the sub-transfer agent for the Primary A Shares of the Funds on that date and
is providing the same services as were previously provided by NationsBank of
Texas. For the six months ended September 30, 1998, NationsBank of Texas and
NationsBank earned approximately $9,000 and $36,000, respectively, for providing
such services.
Stephens also serves as distributor of the Funds' shares. For the six months
ended September 30, 1998, the Funds were informed that the distributor received
$177,000 in contingent deferred sales charges from shares which were subject to
such charges. A substantial portion of these fees were paid to affiliates of
NationsBank and NBAI.
The Trust pays each unaffiliated Trustee 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 also reimburses expenses incurred by each unaffiliated Trustee in
attending such meetings.
The Trust's eligible Trustees may participate in non-qualified deferred
compensation and retirement plans 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 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, a portfolio of Nations Fund,
Inc. The expense for the deferred compensation and retirement plans is included
in "Trustees' fees and expenses" in the Statements of Operations.
A significant portion of each Fund's Primary A Shares represent investments by
fiduciary accounts over which NationsBank has either sole or joint investment
discretion.
156
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NATIONS FUNDS
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
On September 30, 1998, NationsBank Corporation, the parent company of
NationsBank, merged with BankAmerica Corporation.
3. SHAREHOLDER SERVICING AND DISTRIBUTION PLANS
The Trust has adopted shareholder servicing plans and distribution plans for the
Investor A, Investor B and Investor C shares of each Fund. The shareholder
servicing plans permit the Funds to compensate or reimburse servicing agents for
shareholder services provided by the servicing agents. The distribution plans,
adopted pursuant to Rule 12b-1 under the Investment Company Act of 1940, permit
the Funds to compensate or reimburse the distributor (and for Investor A shares,
the distributor and/or selling agents) for activities or expenses primarily
intended to result in the sale of the class's shares. Payments under the
Investor A shareholder servicing and distribution plan are limited to 0.25% of
Investor A average daily net assets. Payments under the shareholder servicing
plan and distribution plan, respectively, for both Investor B and Investor C
shares are limited to 0.25% and 0.75% of each respective class's average daily
net assets. Actual rates charged are set from time to time by the distributor. A
substantial portion of the expenses incurred pursuant to these plans are paid to
affiliates of NationsBank and NBAI.
At September 30, 1998, the rates in effect and plan limits, as a percentage of
average daily net assets, were as follows:
<TABLE>
<CAPTION>
CURRENT PLAN
RATE LIMIT
----------------
<S> <C> <C>
Investor A Shareholder Servicing and Distribution
Plan.............................................. 0.20%* 0.25%
Investor B and Investor C Shareholder Servicing
Plans............................................. 0.25% 0.25%
Investor B and Investor C Distribution Plans:
Short-Term Municipal Income....................... 0.10% 0.75%
Intermediate Municipal Bond and the eight single-
state Intermediate Municipal Bond Funds......... 0.55% 0.75%
Municipal Income and the eight single-state
Municipal Bond Funds............................ 0.60% 0.75%
</TABLE>
- ---------------
* In addition, a separate shareholder servicing plan has been adopted for the
Investor A Shares of Short-Term Municipal Income. No expenses were incurred by
the Fund pursuant to this plan during the year ended September 30, 1998.
4. PURCHASES AND SALES OF SECURITIES
The aggregate cost of purchases and proceeds from sales of securities, excluding
long-term U.S. government and short-term investments, for the six months ended
September 30, 1998 were as follows:
<TABLE>
<CAPTION>
PURCHASES SALES
----------------------------
<S> <C> <C>
Short-Term Municipal Income............ $ 32,541,000 $ 14,299,000
Intermediate Municipal Bond............ 154,424,000 114,182,000
Municipal Income....................... 179,198,000 31,825,000
Florida Intermediate Municipal Bond.... 18,212,000 4,202,000
Florida Municipal Bond................. 117,380,000 14,434,000
Georgia Intermediate Municipal Bond.... 26,213,000 12,074,000
Georgia Municipal Bond................. 5,746,000 1,623,000
Maryland Intermediate Municipal Bond... 105,949,000 13,721,000
Maryland Municipal Bond................ 10,469,000 2,529,000
North Carolina Intermediate Municipal
Bond.................................. 26,301,000 18,419,000
North Carolina Municipal Bond.......... 8,211,000 1,026,000
South Carolina Intermediate Municipal
Bond.................................. 4,646,000 12,890,000
South Carolina Municipal Bond.......... 2,051,000 --
Tennessee Intermediate Municipal Bond.. 3,014,000 1,634,000
Tennessee Municipal Bond............... 1,783,000 2,351,000
Texas Intermediate Municipal Bond...... 34,857,000 31,668,000
Texas Municipal Bond................... 1,464,000 1,836,000
Virginia Intermediate Municipal Bond... 33,288,000 4,458,000
Virginia Municipal Bond................ 3,003,000 498,000
</TABLE>
There were no purchases and sales of long-term U.S. government securities for
the period ended September 30, 1998.
5. SHARES OF BENEFICIAL INTEREST
As of September 30, 1998, an unlimited number of shares without par value were
authorized for the Trust. 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.
6. LINE OF CREDIT
The Trust participates in an uncommitted line of credit provided by BNY under an
agreement dated July 10, 1998 (the "Agreement"). Advances under the Agreement
are taken primarily for temporary or emergency purposes, including meeting
redemption requests that otherwise might require the untimely disposition of
securities. Interest on borrowings is payable at the Federal funds rate plus
0.50% on an
157
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NATIONS FUNDS
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
annualized basis. Each participating Fund maintains a ratio of no less than 4 to
1 net assets (not including funds borrowed pursuant to the Agreement) to the
aggregate amount of indebtedness pursuant to the Agreement.
For the six months ended September 30, 1998, borrowings were as follows:
<TABLE>
<CAPTION>
AVERAGE
AVERAGE DEBT AVERAGE
AMOUNT AVERAGE PER INTEREST
FUND OUTSTANDING SHARES SHARE RATE
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Short-Term Municipal Income................................. $68,000 11,402,000 $.0060 6.03%
Municipal Income............................................ 13,000 51,423,000 .0003 6.02
Florida Intermediate Municipal Bond......................... 1,000 20,732,000 -- 5.93
Florida Municipal Bond...................................... 3,000 13,149,000 .0003 6.03
Georgia Intermediate Municipal Bond......................... 3,000 13,656,000 .0002 5.98
Georgia Municipal Bond...................................... 2,000 1,960,000 .0008 6.04
Maryland Intermediate Municipal Bond........................ 6,000 14,499,000 .0004 6.01
Maryland Municipal Bond..................................... 2,000 2,673,000 .0009 5.90
North Carolina Intermediate Municipal Bond.................. 8,000 18,507,000 .0004 6.07
South Carolina Intermediate Municipal Bond.................. 25,000 25,121,000 .0010 6.11
Tennessee Municipal Bond.................................... 9,000 1,065,000 .0081 6.01
Texas Intermediate Municipal Bond........................... 41,000 37,248,000 .0011 5.87
Texas Municipal Bond........................................ 6,000 1,715,000 .0037 6.04
</TABLE>
The average amount outstanding was calculated based on daily balances in the
period.
7. CAPITAL LOSS CARRYFORWARD
At March 31, 1998, the following Funds had available for Federal income tax
purposes the following unused capital losses expiring March 31:
<TABLE>
<CAPTION>
NAME OF FUND 2002 2003 2004 2005 2006
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Short-Term Municipal Income................................. $ 48,000 $374,000 -- -- --
Florida Intermediate Municipal Bond......................... 37,000 753,000 -- $ 22,000 --
Florida Municipal Bond...................................... 531,000 354,000 -- 133,000 $72,000
Georgia Municipal Bond...................................... 18,000 223,000 -- -- --
Maryland Intermediate Municipal Bond........................ -- 949,000 -- -- --
Maryland Municipal Bond..................................... -- -- -- 37,000 --
North Carolina Municipal Bond............................... 287,000 425,000 -- 207,000 --
Tennessee Intermediate Municipal Bond....................... 131,000 53,000 -- 1,000 --
Tennessee Municipal Bond.................................... -- 150,000 -- -- 39,000
Texas Intermediate Municipal Bond........................... -- 110,000 -- -- --
Texas Municipal Bond........................................ 430,000 132,000 -- -- --
Virginia Intermediate Municipal Bond........................ -- 263,000 -- -- --
Virginia Municipal Bond..................................... 465,000 77,000 $12,000 63,000 --
</TABLE>
158
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NATIONS FUNDS
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
8. REORGANIZATIONS
CONVERSION OF COMMON TRUST FUNDS
On August 8, 1997 and August 22, 1997, certain Funds (each an "Acquiring Fund"),
acquired the assets of certain common trust funds managed by NationsBank (each
an "Acquired Fund"), in a tax-free conversion in exchange for shares of the
Acquiring Fund. The number and value of shares issued by the Acquiring Fund are
presented in the Schedule of Capital stock Activity. Net assets as of the merger
date were as follows:
<TABLE>
<CAPTION>
TOTAL NET ASSETS
TOTAL NET ASSETS TOTAL NET ASSETS OF ACQUIRING FUND ACQUIRED FUND
ACQUIRING FUND ACQUIRED FUND OF ACQUIRED FUND OF ACQUIRING FUND AFTER ACQUISITION UNREALIZED APPRECIATION
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Intermediate Nations Common
Municipal Bond Trust Intermediate
Municipal Bond Fund $502,041,000 $350,319,000 $852,359,000 $ 23,696,000
Municipal Income Nations Common
Trust Municipal
Bond Fund 159,212,000 327,035,000 486,247,000 9,643,000
Florida Intermediate Nations Common
Municipal Bond Trust Florida
Municipal Bond Fund 136,392,000 69,328,000 205,720,000 7,073,000
Georgia Intermediate Nations Common
Municipal Bond Trust Tax-Free
Income Fund for
Personal Trust 26,050,000 66,471,000 92,521,000 814,000
Georgia Intermediate Nations Common
Municipal Bond Trust Georgia
Municipal Bond Fund 52,613,000 92,521,000 145,134,000 2,973,000
North Carolina Nations Common
Intermediate Trust North
Municipal Bond Carolina
Municipal Bond Fund 141,745,000 42,541,000 184,286,000 6,802,000
South Carolina Nations Common
Intermediate Trust Old Colony
Municipal Bond South Carolina Tax-
Exempt Bond Fund 68,636,000 70,529,000 139,165,000 5,053,000
South Carolina Nations Common
Intermediate Trust South
Municipal Bond Carolina
Municipal Bond Fund 137,649,000 139,165,000 276,814,000 6,747,000
Tennessee Nation Common Trust
Intermediate Tennessee Municipal
Municipal Bond Bond Fund 25,429,000 20,696,000 46,124,000 1,049,000
Texas Intermediate Nations Common
Municipal Bond Trust Texas
Municipal Bond Fund 357,784,000 30,219,000 388,003,000 15,315,000
</TABLE>
159
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NATIONS FUNDS
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
On June 19, 1998, certain Funds (each an "Acquiring Fund"), acquired the assets
of certain common trust funds managed by NationsBank (each an "Acquired Fund"),
in a tax-free conversion in exchange for shares of the Acquiring Fund. The
number and value of shares issued by the Acquiring Fund are presented in the
Schedule of Capital Stock Activity. Net assets as of the merger date were as
follows:
<TABLE>
<CAPTION>
TOTAL NET ASSETS
TOTAL NET ASSETS TOTAL NET ASSETS OF ACQUIRING FUND ACQUIRED FUND
ACQUIRING FUND ACQUIRED FUND OF ACQUIRED FUND OF ACQUIRING FUND AFTER ACQUISITION UNREALIZED APPRECIATION
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Municipal Income Common
Trust Municipal
Bond Fund $135,044,000 $516,163,000 $651,207,000 $10,717,000
Maryland Intermediate Common Trust
Municipal Bond Intermediate
Municipal Bond Fund 93,840,000 107,066,000 200,906,000 4,791,000
</TABLE>
On June 19, 1998 the Virginia Intermediate Municipal Bond Fund (the "Acquiring
Fund") acquired the assets of the Common Trust Virginia Municipal Bond Fund (the
"Acquired Fund") managed by NationsBank in a taxable conversion in exchange for
shares of the Acquiring Fund. The number and value of shares issued by the
Acquiring Fund are presented in the Schedule of Capital Stock. The net assets of
the Acquired Fund, the Acquiring Fund and the Acquiring Fund after acquisition
as of merger date were, $4,781,000, $247,135,000, and $251,916,000,
respectively.
ACQUISITION OF PILOT FUNDS
On May 16, 1997, certain Funds (each an "Acquiring Fund"), acquired the assets
and certain liabilities of the Pilot Funds (each an "Acquired Fund"), in a tax-
free reorganization in exchange for shares of the Acquiring Fund, pursuant to a
plan of reorganization approved by the Acquired Fund's shareholders. The number
and volume of shares issued by the Acquiring Fund are presented in the Schedule
of Capital Stock Activity. Net assets as of the reorganization date were as
follows:
<TABLE>
<CAPTION>
TOTAL NET ASSETS
TOTAL NET ASSETS TOTAL NET ASSETS OF ACQUIRING FUND ACQUIRED FUND
ACQUIRING FUND ACQUIRED FUND OF ACQUIRED FUND OF ACQUIRING FUND AFTER ACQUISITION UNREALIZED APPRECIATION
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Intermediate Pilot Intermediate
Municipal Bond Municipal Fund $218,884,000 $119,775,000 $338,659,000 $5,841,000
Municipal Income Pilot Municipal
Bond Fund 201,344,000 109,547,000 310,891,000 9,979,000
</TABLE>
ACQUISITION OF EMERALD FUNDS
On May 15, 1998, certain Funds (each an "Acquiring Fund"), acquired the assets
and certain liabilities of the Emerald Funds (each an "Acquired Fund"), in a
tax-free reorganization in exchange for shares of the Acquiring Fund, pursuant
to a plan of reorganization approved by the Acquired Fund's shareholders. The
number and volume of shares issued by the Acquiring Fund are presented in the
Schedule of Capital Stock Activity. Net assets as of the reorganization date
were as follows:
<TABLE>
<CAPTION>
TOTAL NET ASSETS
TOTAL NET ASSETS TOTAL NET ASSETS OF ACQUIRING FUND ACQUIRED FUND
ACQUIRING FUND ACQUIRED FUND OF ACQUIRED FUND OF ACQUIRING FUND AFTER ACQUISITION UNREALIZED APPRECIATION
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Florida Municipal Emerald Florida
Bond Tax Exempt Fund $118,966,000 $47,709,000 $166,675,000 $8,880,000
</TABLE>
160
<PAGE> 165
NATIONS FUNDS
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
9. SUBSEQUENT EVENTS
Effective October 19, 1998, BNY began serving as the custodian for the Trust's
assets and is providing the same services as were previously provided by
NationsBank. There is no longer a sub-custodian for the Trust.
On November 5, 1998, the Trust's Board of Trustees approved changes in the
Fund's administration ar-rangement whereby NBAI and Stephens will each serve as
co-administrators of the Trust, and BNY will serve as sub-administrator of the
Trust. These changes, which will become effective in the first quarter of 1999,
will reflect an increase in the overall administration fees paid by the Funds.
161
<PAGE> 166
[BACKGROUND BASKET DEPICTED GRAPHIC]
<PAGE> 167
--------------
[NATIONS FUNDS LOGO] BULK RATE
P.O. BOX 32602 U.S. POSTAGE
CHARLOTTE, NC 28234-4602 PAID
TOLL FREE 1-800-982-2271 N READING, MA
PERMIT NO. 105
--------------
SAR2 97495 9/98
