<PAGE>
NATIONS
- ----FUNDS--
[Graphic Omitted]
Investments For A Lifetime(SM)
Money Nations
Market Tax Exempt Fund
Funds
Nations
Treasury Fund
Nations
Government
Money Market Fund
Nations
Prime Fund
SEMI ANNUAL REPORT FOR THE PERIOD
ENDED SEPTEMBER 30, 1998
<PAGE>
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>
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 the 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 /s/ Robert H. Gordon
A. Max Walker Robert H. Gordon
President and Chairman of President, NationsBanc
the Board 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>
[This page intentionally left blank.]
<PAGE>
Table
Of
Contents
FINANCIAL STATEMENTS
Statements of Net Assets 2
Statements of Operations 28
Statements of Changes in Net Assets 29
Schedules of Capital Stock Activity 32
Financial Highlights 34
Notes to Financial Statements 42
<PAGE>
NATIONS FUNDS
Nations Tax Exempt Fund
- -------------------------------------------------------------
Statement of Net Assets September 30, 1998 (unaudited)
- -------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
(000) (000)
- -------------------------------------------------------------
MUNICIPAL BONDS AND NOTES - 99.8%
ALABAMA - 2.0%
Alabama (State of), Housing Finance
Authority, Multi-Family Housing,
AmSouth Bank NA, Birmingham LOC:
(Rime Village Hoover Project)
(FNMA Collateral):
$ 1,700 Series A,
3.500% 06/15/26 + ................. $ 1,700
4,500 Series B,
3.500% 06/15/26 + ................. 4,500
6,000 (Turtle Lake Project), Series F,
4.000% 09/01/23 + ................. 6,000
9,890 ASMS Public Education Building
Authority of Mobile, Alabama,
(Alabama High School Math &
Science), AmSouth Bank NA,
Birmingham LOC,
4.000% 07/01/22 + ................. 9,890
1,520 Birmingham, Alabama, Industrial
Development Board, (Avondale -
Phase III ), AmSouth Bank NA,
Birmingham LOC,
4.300% 06/01/00 + ................. 1,520
2,800 Columbia, Alabama, Industrial
Development Board, Pollution
Control Revenue, (Alabama Power
Company Project), AMT,
3.050% 06/01/28 + (a) ............. 2,800
3,000 Gadsden, Alabama, Industrial
Development Board, Industrial
Development Revenue, (Keystone
Foods Corporation Project), AMT,
Bank of Scotland LOC,
4.200% 05/01/04 + (a) ............. 3,000
560 Homewood, Alabama, Industrial
Development Board Revenue,
(Keebler Company Project),
Bank of Nova Scotia LOC,
3.750% 11/01/04 + ................. 560
8,500 McIntosh, Alabama, Industrial
Development Board, Solid Waste
Disposal Revenue, (Ciba-Geigy
Corporation Project), AMT,
Union Bank of Switzerland LOC,
3.650% 07/01/04 + ................. 8,500
800 Northern Alabama Environmental
Improvement Authority, Pollution
Control Revenue, (Reynold Metals),
Bank of Nova Scotia LOC,
4.100% 12/01/00 + ................. 800
2,000 Opelika, Alabama, Industrial
Development Board, (Flowers
Baking Company Project),
SunTrust Bank LOC,
4.050% 12/01/99 + (a) ............. 2,000
8,700 Phenix (County of), Alabama, Industrial
Development Board, Environmental
Improvement Revenue, (Mead
Coated Board Project), Series A,
AMT, Toronto Dominion Bank LOC,
4.200% 06/01/28 ++ ................ 8,700
1,000 Stevenson, Alabama, Industrial
Development Board, Environmental
Improvement Revenue, (Mead
Corporation Project), AMT, Societe
Generale LOC,
4.250% 01/01/31 + ................. 1,000
----------
50,970
----------
ALASKA - 1.8%
16,600 Alaska (State of), Industrial
Development and Export Authority,
Exempt Facilities Revenue,
(Fairbanks Gold Mining Inc.), AMT,
Union Bank of Switzerland LOC,
3.600% 05/01/09 + ................. 16,600
29,550 Valdez, Alaska, Marine Term Revenue,
(Arco Transportation Project),
Series B, Atlantic Richfield
Guaranteed,
3.650% 05/01/31 + ................. 29,550
----------
46,150
----------
ARIZONA - 1.3%
Apache (County of), Arizona, Industrial
Development Authority, Pollution
Control Revenue,
(Tuscon Electric Power):
7,000 Series 83A, Barclays Bank PLC; and
Toronto Dominion LOC,
3.550% 12/15/18 + ................. 7,000
16,000 Series 83B, Bank of New York LOC,
3.600% 12/15/18 + ................. 16,000
5,100 Casa Grande, Arizona, Industrial
Development Authority Revenue,
(Mayville Metal), Toronto
Dominion LOC,
3.300% 07/01/15 + (a) ............. 5,100
4,800 Goodyear, Arizona, Industrial
Development Authority,
(Walle Corporation Project), AMT,
PNC Bank LOC,
4.200% 05/01/15 + (a) ............. 4,800
----------
32,900
----------
ARKANSAS - 0.4%
6,300 Little Rock, Arkansas, Metrocentre
District Number 1, Improvement
Revenue, (Little Rock Newspapers Inc.
Project), Bank of New York LOC,
4.200% 12/01/25 ++ ................ 6,300
3,250 Lowell, Arkansas, Industrial
Development Revenue, (Little Rock
Newspapers Inc. Project), AMT,
Bank of New York LOC,
3.800% 06/01/31 + (a) ............. 3,250
----------
9,550
----------
CALIFORNIA - 1.7%
California (State of), Higher Education
Loan Authority Inc., Student Loan
Revenue, Sr. Lien, Student Loan
Marketing Guarantee:
7,500 Series A-1,
3.650% 04/01/00 + ................. 7,500
19,000 Series A-2,
3.800% 04/01/00 + ................. 19,000
7,000 Los Angeles, California, Regional
Airports Improvement Corporation,
Terminal Facilities Revenue,
AMT, (Los Angeles International
Airport), Societe Generale LOC,
4.200% 12/01/25 ++ ................ 7,000
10,000 Student Education Loan Marketing
Corporation, California Student Loan
Revenue, Series A, Dresdner
Bank AG LOC,
3.850% 11/01/98 + ................. 10,000
----------
43,500
----------
COLORADO - 3.8%
5,440 Arapahoe (County of), Colorado,
Industrial Development Revenue,
(Suntory Water Group Inc. Project),
AMT, Wachovia Bank
of North Carolina LOC,
4.100% 05/01/23 + (a) ............. 5,440
13,000 Colorado (State of), Housing Finance
Authority, Multi-Family Housing
Revenue, (Grants Plaza), Series A,
Bankers Trust Company LOC,
4.125% 11/01/09 + ................. 13,000
Denver (City and County of), Colorado,
Airport Revenue, AMT, Credit Local
de France LOC:
3,500 Series F,
3.650% 11/15/25 + ................. 3,500
5,000 Series G,
3.650% 11/15/25 + ................. 5,000
23,590 Denver (City and County of), Colorado,
Multi-Family Housing
Revenue, PT-1036,
Merrill Lynch Guarantee and SBPA,
4.170% 10/15/08 + (a) ............. 23,590
5,305 El Paso (County of), Colorado,
Multi-Family Housing Revenue,
(Briarglen Apartments Project),
General Electric Capital
Corporation Guaranty,
3.550% 12/01/24 + (a) ............. 5,305
39,300 Moffat (County of), Colorado, Pollution
Control Revenue, AMBAC Insured;
and Societe Generale SBPA,
3.650% 07/01/20 + ................. 39,300
3,200 Pitkin (County of), Colorado,
Industrial Development Revenue,
(Aspen Skiing Company Project),
Series B, AMT, First National Bank
of Chicago LOC,
4.250% 04/01/14 + (a) ............. 3,200
----------
98,335
----------
DELAWARE - 2.9%
36,900 Delaware (State of), Economic
Development Authority, Hospital
Billing Revenue, Series C,
MBIA Insured; and Morgan
Stanley Group Inc. SBPA,
3.550% 12/01/15 + ................. 36,900
Delaware (State of), Economic
Development Authority, Industrial
Development Revenue, (Star
Enterprise), AMT, Canadian
Imperial Bank of
Commerce LOC:
12,000 Series A,
3.700% 08/01/29 + ................. 12,000
10,000 Series B,
3.750% 08/01/29 + ................. 10,000
17,300 Series C,
3.750% 08/01/29 + ................. 17,300
----------
76,200
----------
FLORIDA - 6.5%
12,810 Broward (County of), Florida, Housing
Finance Authority, Multi-Family
Housing Revenue, (Fisherman's
Project), Continental Casualty
Surety Bond,
3.550% 11/01/07 + ................. 12,810
12,617 Broward (County of), Florida, Housing
Finance Authority, PT-1016,
Merrill Lynch Guarantee and SBPA,
4.190% 12/01/29 + (a) ............. 12,617
54,494 Dade (County of), Florida, Housing
Finance Authority, Multi-Family
Housing Revenue, PT-1014,
Merrill Lynch Guarantee and SBPA,
4.190% 12/01/29 + (a) ............. 54,494
Dade (County of), Florida, Industrial
Development Authority:
7,600 (Bull Moose Tube Company Project),
AMT, Bank of Nova Scotia LOC,
4.100% 12/01/12 + (a) ............. 7,600
(Dolphins Stadium Project),
Societe Generale LOC:
4,000 Series C,
3.500% 01/01/16 + (a) ............. 4,000
5,100 Series D,
3.500% 01/01/16 + (a) ............. 5,100
4,830 (Phase II Furniture Corporation
Project), AMT, SunTrust Bank LOC,
4.150% 11/01/14 + (a) ............. 4,830
14,999 Florida (State of), Board of Education,
Capital Outlay, BTP-179,
Bankers Trust Company SBPA,
4.150% 06/01/01 + (a) ............. 14,999
14,800 Florida (State of), Housing Finance
Agency, (Clear Lake Project),
Continental Casualty Surety Bond,
3.550% 01/01/34 + ................. 14,800
Florida (State of), Housing Finance
Agency, Multi-Family Housing
Revenue:
3,100 (Lake of North Dale Project),
Southtrust Bank LOC,
4.100% 06/01/07 + ................. 3,100
5,000 (Lakeside Project), Series B,
Bankers Trust Company LOC,
4.125% 08/01/06 + (a) ............. 5,000
3,645 Manatee (County of), Florida, Housing
Finance Authority, Multi-Family
Mortgage Revenue, (Hampton
Court Project), Series A,
First Union Bank LOC,
4.000% 06/01/07 + (a) ............. 3,645
12,700 Miami, Florida, Health Facilities
Authority, Health Facilities Revenue,
(Miami Jewish Home & Hospital),
SunTrust Bank, Miami LOC,
4.050% 12/01/16 + (a) ............. 12,700
1,500 Palm Beach (County of), Florida,
(Norton Gallery Inc. Project),
Northern Trust LOC,
3.600% 05/01/25 + ................. 1,500
3,100 St. Lucie (County of), Florida,
Industrial Development Authority,
(Florida Convalescent Centers
Project), Series A, Toronto
Dominion Bank LOC,
3.350% 01/01/11 +++ ............... 3,100
9,500 University of Northern Florida, Capital
Improvement Revenue, First Union
National Bank of North Carolina LOC,
4.050% 11/01/27 + ................. 9,500
----------
169,795
----------
GEORGIA - 9.0%
10,000 Albany-Dougherty, Georgia, Payroll
Development Authority, Pollution
Control Revenue, (Phillip Morris
Companies Inc. Project),
3.850% 10/01/05 + (a) ............. 10,000
1,150 Bartow (County of), Georgia,
Development Authority, Pollution
Control Revenue, (Georgia Power
Company Plant, Bowen Project),
4.150% 03/01/24 + (a) ............. 1,150
2,085 Burke (County of), Georgia,
Development Authority, Pollution
Control Revenue, (Georgia
Power Company, Vogtle), 3rd Series,
4.150% 09/01/25 + ................. 2,085
7,750 Clayton (County of), Georgia, Hospital
Authority, (Southern Regional
Medical Center Project), Series B,
SunTrust Bank LOC,
4.050% 08/01/19 + (a) ............. 7,750
Clayton (County of), Georgia, Housing
Authority, Multi-Family Housing
Revenue:
6,385 (Chateau Forest Apartments),
Series E, Barclays Bank PLC SBPA;
and FSA Guarantee,
3.600% 01/01/21 + ................. 6,385
3,380 (Village Rouge Project),
3.600% 01/01/21 + ................. 3,380
2,215 Cobb (County of), Georgia, Industrial
Development Authority Revenue,
(Datagraphic Inc. Project), AMT,
Southtrust Bank LOC,
4.150% 05/01/05 + ................. 2,215
3,600 Cobb (County of), Georgia, Residential
Care Facilities for the Elderly
Authority, (North Georgia
Presbyterian Homes Inc. Project),
SunTrust Bank LOC,
4.050% 08/01/18 + (a) ............. 3,600
17,330 Cobb-Marietta, Georgia, Coloseum &
Exhibit Hall Authority Revenue,
Jr. Lien, Series A, MBIA Guarantee,
Canadian Imperial Bank of
Commerce SBPA,
3.700% 10/01/26 + (a) ............. 17,330
3,420 College Park, Georgia, Business &
Industrial Development Authority
Revenue, (College Park Association
Project), Bank of New York LOC,
3.700% 06/01/14 + (a) ............. 3,420
12,515 Columbia (County of), Georgia,
Elderly Authority Residential Care
Facilities Revenue, (Augusta
Resource Center on Aging),
SunTrust Bank LOC,
4.050% 01/01/21 + (a) ............. 12,515
2,250 Columbus, Georgia, Housing Authority,
Multi-Family Housing Revenue,
(Quail Ridge Project), Columbus
Bank & Trust LOC,
4.100% 02/01/05 + ................. 2,250
3,330 Columbus, Georgia, Industrial
Development Revenue, (Parisian Inc.
Project), Columbus Bank & Trust
Company LOC,
4.400% 04/01/07 + (a) ............. 3,330
Dekalb (County of), Georgia,
Development Authority, Industrial
Development Revenue:
3,500 (A. G. Rhodes Home Inc. Project),
SunTrust LOC,
4.050% 03/01/21 + (a) ............. 3,500
7,430 (American Cancer Society Inc.),
SunTrust Company Bank LOC,
4.050% 05/01/13 + (a) ............. 7,430
5,250 (Radiation Steralizers),
Comerica LOC,
3.600% 03/01/05 + ++ (a) .......... 5,250
Dekalb (County of), Georgia, Housing
Authority, Multi-Family Housing Revenue:
2,800 (Camden Brook Project), FNMA
Collateral Agreement,
3.650% 06/15/25 + ................. 2,800
5,430 (Haystack Apartment Projects),
AMT, General Electric Capital
Corporation Guarantee,
4.150% 12/01/20 + (a) ............. 5,430
6,875 (Stone Mill Run Apartments Project),
Series A, AMT, First Tennessee
Bank LOC,
4.150% 08/01/27 + ................. 6,875
5,000 (Terrace Club Project), Series B,
Southtrust Bank LOC,
4.000% 11/01/15 + ................. 5,000
14,935 (Wood Terrace Apartments Project),
FNMA Collateral Project,
4.050% 12/15/15 + ................. 14,935
3,460 Dekalb (County of), Georgia, Housing
Authority, Revenue Anticipation
Certificates, (Dekalb Medical
Center Project), SunTrust Company
Bank LOC,
4.050% 09/01/09 + (a) ............. 3,460
4,000 Floyd (County of), Georgia,
Development Authority, Pollution
Control Revenue, (Georgia Power
Company Plant Hammond Project),
4.100% 09/01/26 + (a) ............. 4,000
5,800 Fulco (County of), Georgia, Hospital
Authority, (Piedmont Hospital
Project), SunTrust Bank LOC,
4.050% 02/01/07 + (a) ............. 5,800
Fulton (County of), Georgia,
Development Authority Revenue:
12,500 (Robert W. Woodruff Arts),
Wachovia Bank of Georgia LOC,
4.000% 08/01/18 + (a) ............. 12,500
3,000 (Spellman College Project),
SunTrust Bank LOC,
4.050% 06/01/16 + ................. 3,000
2,400 Greene (County of), Georgia,
Industrial Development Authority
Revenue, (Chipman-Union Inc. ......
Project), Series A, AMT, SunTrust
Bank LOC,
4.150% 03/01/05 + (a) ............. 2,400
7,500 Gwinnett (County of), Georgia,
Industrial Development Revenue,
(United Stationers Company
Project), PNC Bank LOC,
4.050% 12/31/02 + (a) ............. 7,500
3,000 Henry (County of), Georgia,
Development Authority Revenue,
(Georgia-Pacific Corporation
Project), SunTrust Bank LOC,
4.050% 05/01/04 + (a) ............. 3,000
35,000 Municipal Electric Authority, Georgia,
(Project One), Subordinated Bonds,
Series E, ABN-AMRO Bank LOC,
3.600% 01/01/26 + ................. 35,000
1,000 Newton (County of), Georgia,
Industrial Development Authority,
Industrial Development Revenue,
(H. B. Fuller Company),
Commerzbank AG LOC,
4.150% 12/01/04 + ................. 1,000
16,300 Smyrna, Georgia, Multi-Family
Housing Authority Revenue, (Post
Valley Project), FNMA
Collateralized,
3.500% 06/01/25 + ................. 16,300
4,000 Tallapoosa, Georgia, Development
Authority Revenue, (U.S. Can
Company Project), Harris Trust &
Savings Bank LOC,
3.650% 02/01/15 + (a) ............. 4,000
5,000 Thomaston-Upson (County of),
Georgia, Industrial Development
Revenue, (Quad/Thomaston
Project), First Union National Bank,
Charlotte LOC,
4.000% 04/01/00 + (a) ............. 5,000
5,550 Worth (County of), Georgia, Industrial
Development Authority Revenue,
(Seabrook Project), Series A,
SunTrust Bank LOC,
4.050% 08/01/23 + (a) ............. 5,550
----------
235,140
----------
HAWAII - 0.3%
8,500 Hawaii (State of), Housing Finance and
Development Corporation, Rental
Housing System Revenue Bonds,
Series 89A, Banque Nationale de
Paris LOC,
3.550% 07/01/24 + ................. 8,500
----------
IDAHO - 0.9%
22,275 Idaho (State of), Housing & Finance
Association, AMT, PT-173,
Commerzbank AG SBPA
4.150% 07/01/29 + (a) ............. 22,275
----------
ILLINOIS - 18.5%
2,600 Chicago, Illinois, Airport Special
Facilities, (Centerpoint O'Hare),
First National Bank of Chicago LOC,
3.800% 09/01/32 + (a) ............. 2,600
6,075 Chicago, Illinois, Industrial
Development Revenue, (Eli's
Chicago's Finest Inc.), AMT,
U.S. Bank NA LOC,
4.250% 11/01/26 + (a) ............. 6,075
Chicago, Illinois, Multi-Family
Housing, (Waveland Association),
UBS AG LOC:
6,750 Project B,
3.500% 11/01/10 + ................. 6,750
12,600 Project F,
3.500% 11/01/10 + ................. 12,600
Chicago, Illinois, O'Hare International
Airport Revenue:
1,700 (American Airlines Inc.), Series B,
Royal Bank of Canada LOC,
4.200% 12/01/17 ++ ................ 1,700
(General Airport, 2nd Lien),
Societe Generale LOC:
13,800 Series A,
3.500% 01/01/15 + ................. 13,800
6,370 Series B,
3.500% 01/01/15 + ................. 6,370
7,400 Series C,
3.550% 01/01/18 + ................. 7,400
Illinois (State of), Development
Finance Authority:
4,320 (Chicago Academy of Sciences),
American National Bank & Trust
Company LOC,
3.750% 01/01/31 + ................. 4,320
26,100 (Chicago Symphony Orchestra),
Northern Trust Company LOC,
3.550% 12/01/28 + ................. 26,100
30,300 (Lyric Opera Chicago Project),
Northern Trust Company;
NBD Bank NA; Harris Trust &
Savings Bank; and Caisse National
de Credit Agricoli LOC,
3.650% 12/01/28 + ................. 30,300
5,000 (Presbyterian Home Lake), Series A,
LaSalle Bank LOC,
3.750% 10/01/31 + ................. 5,000
9,000 (Roosevelt University Project),
American National Bank & Trust
Company LOC,
3.750% 04/01/25 + ................. 9,000
9,000 (YMCA of Metropolitan Chicago
Project), Series A, Harris Trust &
Savings Bank LOC,
3.650% 06/01/26 + ................. 9,000
Illinois (State of), Development
Finance Authority, Economic
Development Revenue:
1,900 (Addison 450 LP Project), AMT,
American National Bank & Trust
Company LOC,
3.625% 12/01/09 + ................. 1,900
9,100 (Edison Company Project), Series C,
ABN-AMRO Bank LOC,
3.625% 03/01/09 + ................. 9,100
3,330 (Randolph Pickle Corporation), AMT,
American National Bank & Trust
Company LOC,
3.950% 06/01/12 + ................. 3,330
2,415 (Xavier University), American
National Bank & Trust
Company LOC,
3.750% 10/01/12 + ................. 2,415
28,000 Illinois (State of), Development
Finance Authority, Pollution Control
Revenue, (Commonwealth Edison
Company Project), ABN-AMRO
Bank LOC,
3.600% 10/15/14 + (a) ............. 28,000
Illinois (State of), Educational Facilities
Revenue:
8,900 (Arts Clubs of Chicago), Northern
Trust Company LOC,
3.650% 01/01/26 + ................. 8,900
6,300 (Chicago Historical Society),
Northern Trust Company LOC,
3.650% 12/01/25 + (a) ............. 6,300
4,000 (DePaul University), Series CP-1,
Northern Trust Company LOC,
3.650% 04/01/26 + ................. 4,000
29,000 (Field Museum of Natural History),
Northern Trust Company LOC,
3.650% 11/01/32 + ................. 29,000
14,500 (Illinois Institute of Technology),
Series A, NBD Bank NA; Northern
Trust Company; and Harris Trust
and Savings Bank LOC,
3.650% 09/01/25 + ................. 14,500
6,000 (Museum of Science & Industry),
First National Bank of Chicago LOC,
3.650% 10/01/26 + ................. 6,000
11,385 (University Pooled Financing
Program), FGIC Insured; and
NBD Bank NA SBPA,
3.650% 12/02/05 + ................. 11,385
Illinois (State of), Health Facilities
Authority Revenue Bonds:
5,500 (Childrens Memorial Hospital
Project), Series B, National Bank of
Detroit LOC,
3.650% 11/01/15 + ................. 5,500
(Evanston Hospital Corporation),
10,000 3.850% 02/01/99 + ................. 10,000
2,000 3.850% 02/01/99 ++ ................ 2,000
18,000 3.700% 03/01/99 ++ ................ 18,000
11,000 3.700% 07/15/99 ++ ................ 11,000
7,000 (Evanston Hospital Corporation),
Series B,
3.550% 08/15/15 ++ ................ 7,000
5,000 (Gottlieb Health Resources Inc.
Project), Harris Trust and Savings
Bank LOC,
3.650% 11/15/24 + ................. 5,000
10,050 (Park Plaza Retirement Center
Project), ABN-AMRO Bank LOC,
3.650% 09/15/20 + ................. 10,050
8,000 Series C, First National Bank of
Chicago LOC,
3.650% 08/01/15 + (a) ............. 8,000
7,100 (The Streeterville Corporation
Project), First National Bank of
Chicago LOC,
3.650% 08/15/24 + ................. 7,100
5,000 (University of Chicago) Series A,
3.750% 08/01/15 + ................. 5,000
44,000 Illinois (State of), Housing
Development Authority, Housing
Revenue, (Illinois Center
Apartments), Met Life Guaranty
LOC; and KBC Bank SBPA,
3.600% 01/01/08 + (a) ............. 44,000
7,000 Jackson-Union (Counties of), Illinois,
Regional District, Port Facilities
Revenue, (Environmental
Transportation Services), First
Union National Bank LOC,
3.550% 04/01/22 + ................. 7,000
13,700 Kane (County of), Illinois, Educational
Facilities Revenue, (Glenwood
School For Boys), Harris Trust &
Savings Bank LOC,
3.650% 02/01/28 + ................. 13,700
15,000 Lisle, Illinois, Multi-Family Housing
Revenue, (Ashley of Lisle Project),
LaSalle National Bank LOC,
3.650% 12/15/25 + ................. 15,000
4,935 Lombard, Illinois, Multi-Family
Housing, Continental Casualty
Surety Bond, (Clover Creek
Apartment Project),
4.000% 12/15/98 + ................. 4,935
9,200 Orland Park, Illinois, Industrial
Development Revenue, (Panduit
Corporation Project), AMT,
Wachovia Bank, Georgia LOC,
3.800% 04/01/31 + (a) ............. 9,200
3,700 Palos Hills, Illinois, Multi-Family
Housing Revenue, (Green Oaks
Project), AMT, LaSalle National
Bank LOC,
3.750% 08/01/29 + (a) ............. 3,700
7,000 Quincy, Illinois, (Quincy University),
Allied Irish Bank PLC LOC,
4.050% 06/01/22 + ................. 7,000
7,195 Richton Park, Illinois, Industrial
Development Revenue, (Sinter
Metals Inc. Project), AMT,
Mellon Bank LOC,
4.150% 04/01/16 + (a) ............. 7,195
7,600 Sauget, Illinois, GO, Credit Locale de
France LOC,
3.650% 02/01/16 + ................. 7,600
1,600 Southwestern Illinois Development
Authority, Industrial Development
Revenue, (Robinson Steel
Company Inc. Project), AMT,
American National Bank & Trust
Company LOC,
3.625% 12/01/06 + ................. 1,600
5,000 Woodford (County of), Illinois,
Industrial Development Authority
Revenue, (Parsons Company Inc. ....
Project), AMT, Bank One
Illinois NA LOC,
4.150% 03/01/13 + (a) ............. 5,000
----------
480,425
----------
INDIANA - 3.3%
505 Evansville, Indiana, Industrial
Development Revenue, (Keebler
Company Project), Bank of
Nova Scotia LOC,
3.750% 06/01/04 + ................. 505
5,200 Fort Wayne, Indiana, Economic
Development Revenue,
(Georgetown Place Venture Project),
Federal Home Loan Bank LOC,
3.550% 12/01/15 + (a) ............. 5,200
1,000 Gary, Indiana, Environmental
Improvement Revenue, (U. S. Steel
Corporation Project), Bank of
Nova Scotia LOC,
3.600% 07/15/02 + ................. 1,000
3,495 Hendricks (County of), Indiana,
Redevelopment Commission, Tax
Increment Revenue, (Heartland
Crossings Project), Series A,
Bank One NA LOC,
4.050% 01/01/22 + (a) ............. 3,495
Indiana (State of), Development
Finance Authority, Economic
Development Revenue:
14,900 Educational Facilities, (Indiana
Historical Society Project),
NBD Bank LOC,
3.650% 08/01/31 + (a) ............. 14,900
1,700 (Fischer Enterprises Ltd. Project),
PNC Bank LOC,
4.200% 11/01/01 + (a) ............. 1,700
9,700 (Indiana University Foundation
Project), National City Bank LOC,
4.050% 08/01/18 + (a) ............. 9,700
3,000 (Mid America Project), AMT,
ABN-AMRO Bank NV LOC,
3.800% 09/01/30 + (a) ............. 3,000
2,200 (Walker-Williams Lumber
Company Inc.), AMT, Columbus
Bank & Trust Company LOC,
4.400% 01/01/09 + (a) ............. 2,200
1,150 Indiana (State of), Health Facilities
Financing Authority, (Capital Access
Designated Pool), Comerica
Bank LOC,
3.650% 01/01/12 + ................. 1,150
8,500 Indiana (State of), Hospital Equipment
Financing Authority, (ISND),
Series A, MBIA LOC; and NBD
Bank SBPA,
3.650% 12/01/15 + (a) ............. 8,500
4,900 Indianapolis, Indiana, Economic
Development Revenue, (Edgcomb
Metals Company Project),
Banque Nationale de Paris LOC,
3.650% 12/01/08 + ................. 4,900
3,100 Indianapolis, Indiana, Multi-Family
Housing Revenue, (El Beulah
Retirement Village), National
Bank of Detroit LOC,
3.800% 03/01/21 + (a) ............. 3,100
2,900 Rockport, Indiana, Pollution Control
Revenue, (Indiana and Michigan
Electric Company), Series A,
UBS AG LOC,
3.650% 08/01/14 + (a) ............. 2,900
5,440 St. Joseph's (County of), Indiana,
Economic Development Revenue,
(Brothers of the Holy Cross Project),
Key Bank LOC,
3.730% 09/01/17 + (a) ............. 5,440
12,500 South Bend, Indiana, Community
School Corporation, Tax
Anticipation Warrants,
4.250% 12/31/98 + (a) ............. 12,511
6,600 Terre Haute, Indiana, Economic
Development Revenue, (First
Financial Corporation Project),
First National Bank of Chicago LOC,
3.650% 12/01/15 + ................. 6,600
----------
86,801
----------
IOWA - 0.3%
5,000 Davenport, Iowa, Community School
District, Anticipation Warrants,
State Aid Withholding,
3.950% 07/01/99 + ................. 5,006
2,000 Iowa (State of), Finance Authority,
Industrial Development Revenue,
(Sauer-Sunstrand Company Project),
AMT, HypoVereinsbank LOC,
3.750% 05/01/26 + (a) ............. 2,000
----------
7,006
----------
KANSAS - 2.1%
1,900 Kansas City, Kansas, Industrial
Revenue, (PQ Corporation Project),
Bank of New York LOC,
4.200% 08/01/15 + ................. 1,900
9,600 Kansas (State of), Development
Finance Authority, (Seaboard
Projects), Series A, AMT,
Bank of New York LOC,
4.100% 12/02/25 + (a) ............. 9,600
2,500 Lawrence, Kansas, GO, Series B,
3.900% 10/01/98 + ................. 2,500
41,470 Olathe, Kansas, Educational Facilities
Revenue, (Kansas Independent
College Association), Series A,
Midland Bank PLC LOC,
3.650% 07/01/24 + ................. 41,470
----------
55,470
----------
KENTUCKY - 2.4%
12,000 Georgetown, Kentucky, Educational
Institution Improvement Revenue,
(Georgetown College Project),
Bank One Kentucky NA LOC,
4.050% 12/01/17 + (a) ............. 12,000
1,300 Hopkinsville, Kentucky, Industrial
Building Revenue, (Brazeway Inc. ..
Project), AMT, NBD Bank NA LOC,
4.050% 06/01/04 + (a) ............. 1,300
7,400 Kentucky (State of), Economic
Development Finance Authority,
Hospital Facilities Revenue,
(Baptist Healthcare Systems
Project), Canadian Imperial Bank of
Commerce LOC,
3.520% 08/15/31 + ................. 7,400
7,000 Kentucky (State of), Housing
Corporation, Housing Revenue,
AMT, Series C,
3.700% 07/01/99 + ................. 7,000
3,500 Lebanon, Kentucky, Industrial
Development Revenue, (Wallace
Computer Services Inc.), AMT,
Wachovia Bank, Georgia LOC,
3.800% 06/01/19 + (a) ............. 3,500
Lexington-Fayette, Kentucky, Urban
County Airport Corporation
Revenue, AMT, Credit Local de
France LOC:
3,600 Series A,
4.300% 04/01/24 ++ ................ 3,600
2,900 Series B,
4.300% 04/01/24 ++ ................ 2,900
4,880 Louisville and Jefferson (Counties of),
Kentucky, Visitors and Convention
Commission, FSA Insured; and
Merrill Lynch SBPA,
4.140% 01/01/24 + (a) ............. 4,880
Mason (County of), Kentucky,
Pollution Control Revenue, (East
Kentucky Power Cooperative Inc.
Project), CFC Insured:
5,700 Series B1,
3.650% 10/15/14 + ................. 5,700
8,950 Series B2,
3.650% 10/15/14 + ................. 8,950
6,000 Middletown, Kentucky, (Christian
Academy Project), Bank One LOC,
4.050% 07/01/22 + (a) ............. 6,000
----------
63,230
----------
LOUSIANA - 3.7%
6,550 Caddo Parish, Louisiana, Industrial
Development Board, (Frymaster
Corporation Project), Chase
Bank LOC,
3.800% 01/01/03 + ................. 6,550
23,300 Jefferson Parish, Louisiana, Hospital
Service Revenue, District Number 1,
(West Jefferson Medical Center),
Rabobank Nederland LOC,
3.600% 01/01/26 + ................. 23,300
Louisiana (State of), Public Facilities
Authority, Pollution Control
Revenue:
21,225 (Ciba-Geigy Corporation Project),
UBS AG LOC,
3.550% 12/01/04 + ................. 21,225
25,000 (Willis Knighter Medical Center),
AMBAC Insured; and Credit Local
de France SBPA,
3.600% 09/01/27 + ................. 25,000
1,000 Plaquemines, Louisiana, Port
Harbor & Terminal District, Port
Facilities Revenue, (International
Marine Terminal Project), Series A,
Morgan Guaranty Trust
Company LOC,
3.600% 03/15/06 + ................. 1,000
3,900 St. Charles Parish, Louisiana,
Pollution Control Revenue, (Shell
Oil Company Project),
4.200% 10/01/25 + ................. 3,900
9,000 South Louisiana Ports, Common Port
Revenue, (Holnam Inc. Project),
AMT, Wachovia Bank LOC,
3.600% 01/01/27 + (a) ............. 9,000
5,345 Upper Pontalba, Louisiana, Building
Restoration Corporation Revenue,
(Upper Pontalba Building Project),
Bank One LOC,
4.050% 12/01/16 + ................. 5,345
----------
95,320
----------
MARYLAND - 3.2%
70,700 Baltimore (City of), Maryland,
Industrial Development Authority,
(Baltimore Capital Acquisition),
Bayerische Landesbank LOC,
3.450% 08/01/16 + ................. 70,700
3,300 Baltimore (City of), Maryland, Port
Facilities Authority, (Occidental
Petroleum Company), Wachovia
Bank LOC,
3.550% 10/14/11 +++ ............... 3,300
6,900 Maryland (State of), Economic
Development Revenue, (General
Binding Corporation Project), AMT,
Harris Trust & Savings Bank LOC,
3.800% 03/01/26 + (a) ............. 6,900
2,300 Maryland (State of), Industrial
Development Finance Authority,
(Rock-Tennessee Converting
Company), AMT, SunTrust
Company Bank LOC,
4.150% 05/01/06 + (a) ............. 2,300
----------
83,200
----------
MASSACHUSETTS - 0.2%
4,000 Massachusetts (State of), Industrial
Finance Authority, Development
Revenue, (Sunstrand Corporation
Project), AMT, UBS LOC,
4.150% 05/01/32 + ................. 4,000
----------
MICHIGAN - 1.4%
1,100 Delta (County of), Michigan, Economic
Development Corporation Revenue,
Improvement Revenue Bonds,
(Mead-Escanaba Paper Project),
Series D, AMT,
4.150% 12/01/23 + ................. 1,100
7,500 Grand Rapids, Michigan, Economic
Development Corporation, Industrial
Development Revenue, (Baker,
Knapp & Tubbs Project), Wachovia
Bank & Trust Company LOC,
4.000% 06/01/12 + (a) ............. 7,500
14,800 Green Lake, Michigan, Economic
Development Corporation Revenue,
(Interlochen Center Arts Project),
LaSalle National Bank LOC,
3.650% 06/01/27 + (a) ............. 14,800
3,185 Jackson (County of), Michigan,
Economic Development
Corporation, Industrial Development
Revenue, (Jackson Association LLC),
Bank One, Dayton LOC,
4.050% 10/01/14 + (a) ............. 3,185
7,800 Michigan (State of), Hospital Financing
Authority Revenue, (St. Mary
Hospital of Livonia), Series A,
Comerica Bank LOC,
3.500% 07/01/17 + ................. 7,800
1,000 Michigan (State of), Job Development
Authority Revenue, (Gordon Food
Service Project), Rabobank
Nederland LOC,
4.000% 08/01/15 + ................. 1,000
900 Michigan (State of), Strategic
Funding Ltd. Obligation Revenue,
(Uni Boring Company Inc.),
NBD Bank NA LOC,
4.000% 12/01/98 + (a) ............. 900
1,180 Michigan (State of), University of
Michigan Hospital Revenues,
Series A,
4.000% 12/01/19 ++ ................ 1,180
----------
37,465
----------
MINNESOTA - 0.4%
5,840 Minneapolis, Minnesota, Community
Development Agency Revenue,
(Arena Acquisition Project),
Series A, U.S. Bank NA LOC,
4.050% 10/01/24 + ................ 5,840
6,160 Minneapolis, Minnesota, Housing
Development Revenue, (Symphony
Place Project), American National
Bank and Trust LOC,
4.050% 12/01/14 + ................. 6,160
----------
12,000
----------
MISSISSIPPI - 0.3%
Mississippi Business Finance
Corporation, Industrial
Development Revenue:
2,400 (Choctaw Maid Farms Inc. Project),
AMT, Rabobank Nederland LOC,
4.150% 03/01/10 + (a) ............. 2,400
2,100 (Mmars 2nd Program Project),
Series A, AMT, Midland Bank LOC,
4.200% 06/01/05 + (a) ............. 2,100
4,000 Perry (County of), Mississippi,
Pollution Control Revenue, (Leaf
River Forest Project), Morgan
Guaranty Trust Company LOC,
4.000% 10/01/12 + (a) ............. 4,000
----------
8,500
----------
MISSOURI - 6.7%
Berkeley, Missouri, Industrial
Development Authority Revenue:
5,000 (Flight Safety International Inc.
Project), Wachovia Bank LOC,
4.000% 09/01/04 + (a) ............. 5,000
5,000 (Wetterau Project), PNC Bank LOC,
3.950% 07/01/06 + (a) ............. 5,000
4,100 Columbia, Missouri, Special
Obligation Revenue, Series A,
Toronto Dominion Bank LOC,
3.550% 06/01/08 + ................. 4,100
10,800 Columbia, Missouri, Water & Electric
Revenue, Series B, Toronto
Dominion Bank LOC,
3.550% 12/01/15 + ................. 10,800
18,400 Kansas City, Missouri, Industrial
Development Authority,
Multi-Family Housing Revenue,
(Timblane Village), Swiss Bank
Corporation LOC,
4.070% 06/01/27 + ................. 18,400
Mexico, Missouri, Industrial
Development Authority Revenue,
(Wetterau Inc. Project),
PNC Bank LOC:
810 Series A,
3.950% 12/01/98 + (a) ............. 810
815 Series B,
3.950% 12/01/98 + (a) ............. 815
Missouri (State of), Environmental
Improvement and Energy Resources
Authority, Pollution Control
Revenue:
2,000 (Monsanto Company Project),
3.650% 06/01/23 + ................. 2,000
(Union Electric Company Project),
Series B, Westdeutsche
Landesbank, Girozentrale LOC,
7,000 3.750% 10/08/98 ++ ................ 7,000
13,370 3.750% 12/04/98 ++ ................ 13,370
7,475 3.800% 12/04/98 ++ ................ 7,475
12,000 3.700% 12/11/98 ++ ................ 12,000
7,400 Missouri (State of), Health and
Educational Facilities Authority,
Educational Facilities Revenue,
(Rockhurst College Project), Allied
Irish Bank Group LOC,
4.000% 11/01/25 + ................. 7,400
Missouri (State of), Health and
Educational Facilities Authority,
Health Facilities Revenue:
9,890 (Barnes Hospital Project), Morgan
Guaranty Trust Company,
New York LOC,
3.600% 12/01/15 + ................. 9,890
(Sisters of Mercy Health Care
Project), Rabobank Nederland
SBPA; and ABN-AMRO LOC:
15,400 Series B,
3.900% 06/01/19 + ................. 15,400
6,100 Series D,
3.900% 06/01/19 + ................. 6,100
Missouri (State of), Health and
Educational Facilities Authority,
School District Advance
Funding Program:
4,700 (Joplin R-VII School District E),
4.250% 09/13/99 + ................. 4,726
5,000 (St. Charles R-VI School District J),
4.250% 09/13/99 + ................. 5,027
9,455 Platte (County of), Missouri, Industrial
Development Authority,
Multi-Family Housing Revenue,
(Wexford Place Project), Bank
One LOC,
4.050% 04/01/28 + (a) ............. 9,455
St. Charles (County of), Missouri,
Industrial Development Authority
Revenue:
3,070 (Casalon Apartments Project),
Citibank LOC,
4.050% 09/01/25 + ................. 3,070
7,525 (Vanderbilt Apartments Project),
Series A, Citibank LOC,
3.700% 08/01/17 + ................. 7,525
St. Louis, Missouri, Industrial
Development Authority Revenue,
(Wetterau Inc. Project):
5,000 PNC Bank LOC,
3.950% 05/01/09 + (a) ............. 5,000
8,000 Wachovia Bank and Trust LOC,
3.950% 12/01/03 + (a) ............. 8,000
6,170 St. Louis, Missouri, Planned Industrial
Expansion Authority, Development
Revenue, (Alumax Foils Project),
PNC Bank LOC,
4.050% 12/01/05 + (a) ............. 6,170
----------
174,533
----------
MONTANA - 0.2%
1,400 Montana (State of), Health Facilities
Authority, Health Care Revenue,
(Pooled Loan Program), Series A,
FGIC Insured; and Norwest
Bank SBPA,
4.000% 12/01/15 + ................. 1,400
4,950 Montana (State of), Housing Board,
Tender Options Certificates,
AMT, BT-298, Bankers Trust
Company SBPA
4.200% 07/01/31 + (a) ............. 4,950
----------
6,350
----------
NEBRASKA - 0.2%
4,000 York, Nebraska, Industrial
Development Revenue, (Sunstrand
Corporation Project), AMT,
Union Bank of Switzerland LOC,
3.650% 08/01/17 + ................. 4,000
----------
NEVADA - 0.2%
5,400 Washoe (County of), Nevada, Water
Facilities Revenue, (Sierra Pacific
Power Company Project), AMT,
Union Bank of Switzerland LOC,
4.250% 12/01/20 + ................. 5,400
----------
NEW HAMPSHIRE - 0.2%
6,000 Durham, New Hampshire, GO,
3.700% 12/30/98 + ................. 6,000
----------
NEW JERSEY - 0.3%
7,670 New Jersey (State of), Higher
Education Assistance Authority,
Student Loan Revenue, Floating Rate
Certificates, AMT, Series 18, AMBAC
Insured, Morgan Stanley SBPA
4.220% 06/01/17 + (a) ............. 7,670
----------
NEW MEXICO - 0.1%
3,100 Albuquerque, New Mexico, (Charter
Hospital Inc. Project), Chase
Manhattan LOC,
3.800% 03/01/14 + ................. 3,100
----------
NEW YORK - 3.9%
2,895 Erie (County of), New York, Industrial
Development Agency, Civic
Facilities Revenue, (DePaul
Community Facilities Inc. Project),
Key Bank LOC,
3.730% 11/01/16 ++ (a) ............ 2,895
6,915 Monroe (County of), New York,
Industrial Development Agency,
Civic Facilities Revenue, Key
Bank NA LOC (Hillside Childrens
Center Project),
3.730% 08/01/18 + (a) ............. 6,915
40,000 New York City, New York, Municipal
Water Finance Authority, PT-1008,
Water and Sewer System Revenue,
FGIC Insured, Merrill Lynch SBPA,
4.140% 06/15/30 + (a) ............. 40,000
39,175 New York (State of), Dorm Authority
Revenues, PT-1012, MBIA Insured;
and Merrill Lynch SBPA,
4.140% 08/15/21 + (a) ............. 39,175
3,505 Niagara (County of), Industrial
Development Agency, Solid Waste
Disposal Revenue, (BFI),
AMT, Wachovia Bank LOC,
3.500% 11/15/24 + ................. 3,505
9,300 Northport-East Northport,
New York, GO,
3.820% 06/04/99 + ................. 9,301
----------
101,791
----------
NORTH CAROLINA - 2.6%
5,000 Cabarrus (County of), North Carolina,
Industrial Facilities and Pollution
Control Financing Authority,
(Phillip Morris Companies Project),
3.850% 04/01/01 + (a) ............. 5,000
10,855 Charlotte (County of), North Carolina,
Housing Authority, Multi-Family
Housing Revenue, (Merrywood
Senior Adult Project), AMT, Branch
Banking and Trust Company LOC,
3.700% 06/01/11 + ................. 10,855
2,725 Iredell (County of), North Carolina,
Industrial Facilities and Pollution
Control Financing Authority,
(Sullivan Corporation Project),
AMT, Bank One LOC,
4.150% 01/01/11 + (a) ............. 2,725
10,000 Lenoir (County of), North Carolina,
(Lenoir Memorial Hospital
Revenue), Wachovia Bank of
North Carolina LOC,
3.950% 10/01/12 + ................. 10,000
Mecklenburg (County of), North
Carolina, Industrial Facilities and
Pollution Control Finance Authority:
2,000 (Sterigenics International Project),
AMT, Comerica Bank,
California LOC,
3.750% 03/01/16 + (a) ............. 2,000
1,575 (Virkler Company Project), AMT,
First Union National Bank,
Charlotte LOC,
4.100% 12/01/04 + (a) ............. 1,575
7,700 New Hanover (County of), North
Carolina, Industrial Facilities and
Pollution Control Financing
Authority, (Corning Project),
Wachovia Bank NA LOC,
3.950% 05/01/10 + ................. 7,700
North Carolina (State of), Medical
Care, Community Health Care
Facilities Revenue:
4,670 (Missions Thomas St. Joseph),
Wachovia Bank NA LOC,
3.950% 03/01/18 + ................. 4,670
1,300 (Pooled Financing Project),
First Union National Bank LOC,
4.150% 10/01/13 + ................. 1,300
10,545 North Carolina (State of), NC State
Housing Project,
Wachovia Bank SBPA,
3.970% 07/01/99 + (a) ............. 10,545
3,900 Randolph (County of), North Carolina,
Industrial Facilities and Pollution
Control Financing Authority,
(Wayne Steel Inc.), AMT, Bank One,
Akron LOC,
4.150% 09/01/05 + (a) ............. 3,900
3,300 Stanley (County of), North Carolina,
Industrial Development Authority,
Pollution Control Revenue,
(General Signal Corporation),
Wachovia Bank, Georgia LOC,
4.100% 12/01/00 + ................. 3,300
3,410 Winston-Salem, North Carolina, (Risk
Acceptance Management
Corporation Project), Certificates of
Participation, Series 1988,
Wachovia Bank SBPA,
3.650% 07/01/09 + (a) ............. 3,410
----------
66,980
----------
OHIO - 1.9%
2,070 Defiance (County of), Ohio, Industrial
Development Revenue, (Isaac
Property Company), Series A,
Key Bank LOC,
3.730% 07/01/00 + (a) ............. 2,070
8,000 Montgomery (County of), Ohio,
Economic Development Revenue,
(The Dayton Art Institute Project),
National City Bank of Ohio,
3.700% 05/01/26 + ................. 8,000
10,000 Ohio (State of), Air Quality
Development Authority Revenue,
Pollution Control, (Duquesne Power),
Series A, Union Bank of
Switzerland LOC,
3.650% 07/01/99 + ................. 10,000
7,675 Ohio (State of), Water Development
Authority Revenue, Promissory
Notes, Series A, National City
Bank LOC,
4.050% 07/01/00 + (a) ............. 7,675
995 Summit (County of), Ohio, Industrial
Development Revenue, (Keebler
Company Project), Bank of
Nova Scotia LOC,
3.750% 03/01/05 + ................. 995
20,000 Toledo-Lucas (Counties of), Ohio, Port
Authority Airport Revenue, (Flight
Safety), Series 1, AMT, Berkshire
Hathaway Guaranty,
4.150% 01/01/18 + ................. 20,000
----------
48,740
----------
OKLAHOMA - 0.4%
6,000 Muskogee (City and County of),
Oklahoma, Port Authority, Industrial
Development Revenue,
(Metals USA Inc. Project), AMT,
Bank One Texas NA LOC,
4.150% 05/01/23 + (a) ............. 6,000
5,000 Oklahoma (State of), Development
Finance Authority Revenue,
(Seaboard Farms Inc. Project),
AMT, Bank of New York LOC,
3.800% 03/01/27 + (a) ............. 5,000
----------
11,000
----------
OREGON - 0.4%
7,500 Oregon (State of), Housing and
Community Services Department,
Mortgage Revenue, Single Family
Mortgage, Series K, AMT,
3.875% 12/03/98 + ................. 7,500
800 Port Portland, Oregon, Pollution
Control, (Reynolds Metals),
Bank of Nova Scotia LOC,
4.100% 12/01/09 ++ ................ 800
800 Port Portland, Oregon, Special
Obligation Revenue, (Horizon Air
Project), Bank of Montreal LOC,
4.150% 06/15/27 ++ ................ 800
2,000 Washington (County of), Oregon,
Housing Authority, Multi-Family
Housing Revenue, (Cedar Mill
Project), AMT, Bank of
Nova Scotia LOC,
3.800% 09/01/25 + (a) ............. 2,000
----------
11,100
----------
PENNSYLVANIA - 2.7%
Allegheny (County of), Pennsylvania,
Industrial Development Authority:
(Duquesne Power), Canadian
Imperial Bank of Commerce LOC:
5,000 Mode 2,
3.850% 10/21/98 + ................. 5,000
8,800 Series A,
3.850% 10/21/98 + ................. 8,800
8,900 (United Jewish Federation),
Series B, PNC Bank LOC,
4.050% 10/01/25 + (a) ............. 8,900
5,000 Montgomery (County of),
Pennsylvania, Industrial
Development Authority Revenue,
(Plymouth Woods Project),
PNC Bank LOC,
4.050% 09/01/06 + (a) ............. 5,000
1,100 Pennsylvania (State of), Economic
Development, Financing Authority
Development Revenue,
(Pennsylvania Bar Institute),
Series B, AMT, PNC Bank LOC,
4.050% 04/01/25 + (a) ............. 1,100
1,000 Pennsylvania (State of), Higher
Education Facility Authority,
Health Services Revenue,
Allegheny Delaware Valley
Obligatory Notes, Series A,
MBIA Insured
4.400% 11/15/98 + ................. 1,001
Philadelphia, Pennsylvania,
Redevelopment Authority, PNC
Bank LOC:
16,300 (Southwark Plaza)
4.100% 12/01/03 + ................. 16,300
5,900 (The Presbyterian Home),
4.050% 07/01/28 + (a) ............. 5,900
5,200 Quakertown, Pennsylvania, General
Authority Revenue, (Pooled
Financing Program), Series A,
PNC Bank LOC,
3.750% 07/01/26 + ................. 5,200
4,820 Union (County of), Pennsylvania,
Hospital Authority Revenue,
(Evangelical Community Hospital),
Series B, PNC Bank LOC,
4.050% 10/01/23 + ................. 4,820
Westmoreland (County of),
Pennsylvania, Industrial
Development Authority
Revenue, AMT:
5,000 (Elizabeth Carbide Die), Series A,
National City Bank LOC,
4.150% 02/01/18 + (a) ............. 5,000
4,310 (Rhodin Enterprises Project),
PNC Bank LOC,
4.200% 04/01/17 + (a) ............. 4,310
----------
71,331
----------
RHODE ISLAND - 0.5%
4,000 Rhode Island (State of), Industrial
Facilities Corporation, Industrial
Development Revenue,
(Handy & Harman Electric Project),
Bank of Nova Scotia LOC,
3.800% 04/01/04 + (a) ............. 4,000
7,925 Rhode Island (State of), Port
Authority & Economic Development
Corporation, Electric Energy
Facilities Revenue, (Newport
Electric Corporation Project),
Bank of New York LOC,
3.700% 09/01/11 + (a) ............. 7,925
----------
11,925
----------
SOUTH CAROLINA - 2.1%
6,545 Kershaw (County of), South Carolina,
Industrial Development Revenue,
(Deroyal Textiles Inc. Project),
AMT, SunTrust Bank LOC,
4.150% 12/01/07 + (a) ............. 6,545
5,000 Newberry (County of), South Carolina,
School District GO, State Aid
Withholding,
3.750% 04/01/99 + ................. 5,002
5,660 South Carolina (State of), Jobs,
Economic Development Authority,
Health Facilities Revenue, (Martha
Franks Baptist Center Project),
Wachovia Bank, Columbia LOC,
4.000% 04/01/19 + (a) ............. 5,660
4,795 South Carolina (State of), Jobs,
Economic Development Authority,
Industrial Facilities Revenue,
(Kravet Fabrics Inc. Project), AMT,
Bank of New York LOC,
4.100% 03/01/12 + (a) ............. 4,795
9,000 South Carolina (State of), Jobs,
Economic Development Authority
Revenue, (Alco-Lite Industries LLC
Project), AMT, Wachovia Bank,
South Carolina LOC,
4.100% 04/01/12 + ................. 9,000
20,600 South Carolina (State of), Ports
Authority, Ports Revenue, Jr. Lien,
AMT, South Carolina National
Bank LOC,
3.700% 07/01/24 + ................. 20,600
1,950 York (County of), South Carolina,
Pollution Control Revenue, (North
Carolina Electrical Membership
Corporation Project),
CFC Guaranteed,
3.650% 09/15/14 + ................. 1,950
----------
53,552
----------
SOUTH DAKOTA - 1.2%
32,430 South Dakota (State of), Housing
Development Authority, AMT,
PT-168, Banque Nationale
de Paris SBPA,
4.150% 05/01/27 + (a) ............. 32,430
TENNESSEE - 1.8%
Chattanooga, Tennessee, Industrial
Development Board:
2,000 (Seaboard Farms Inc. Project),
SunTrust Bank LOC,
4.000% 06/01/04 + (a) ............. 2,000
5,250 (Warehouse Row Limited Project),
Credit Suisse LOC,
3.750% 12/15/12 + ................. 5,250
4,200 Covington, Tennessee, Industrial
Development Board, (Charms
Company Project),
Societe Generale LOC,
3.800% 06/01/27 + (a) ............. 4,200
6,969 Cumberland (County of), Tennessee,
Industrial Development Board,
Industrial Development Revenue,
(Crossville Ceramics Company
Project), NBD LOC,
3.650% 01/01/00 + (a) ............. 6,969
3,575 Loudon, Tennessee, Water & Sewer
Revenue, Wachovia Bank LOC,
4.000% 09/01/06 ++ ................ 3,575
5,155 Metropolitan Government, Nashville &
Davidson (Counties of), Tennessee,
Industrial Development Board
Revenue, (Nashville Apartment
Properties #2), Third National
Bank LOC,
4.050% 09/01/15 + (a) ............. 5,155
900 Metropolitan, Nashville, Airport
Authority SPL Facilicity Revenue,
(American Airlines Project),
Series B, Bayerische
Landesbank LOC,
4.100% 10/01/12 ++ ................ 900
3,245 Shelby (County of), Tennessee, Health
Educational & Housing Facilities
Board, Multi-Family Housing
Revenue, (Flag Manor), AMT,
Federal Home Loan Bank,
Indianapolis LOC,
4.100% 01/01/23 + (a) ............. 3,245
5,000 Sullivan (County of), Tennessee,
Industrial Development Board
Revenue, (Modern Forge Company
Tennessee Project), AMT, Northern
Trust Company LOC,
3.800% 07/01/10 + (a) ............. 5,000
10,000 Tennessee (State of), Housing
Development Agency,
(Homeowner PG-1), AMT,
3.750% 02/19/99 + ................. 10,000
----------
46,294
----------
TEXAS - 3.9%
3,460 Bexar (County of), Texas, (Army
Retirement), Series 85-B, Rabobank
Nederland LOC, Solid Waste
Revenue, Series 1984B,
4.000% 07/01/11 + ................. 3,460
10,190 Bexar (County of), Texas,
Multi-Family Housing Revenue,
AMT, PT-1041, Merrill Lynch
Guarantee and SBPA
4.220% 06/01/35 + (a) ............. 10,190
1,000 Brazos River, Texas, Higher
Educational Authority, Wachovia
(Hoffman-Laroche),
Bank, Georgia LOC,
4.025% 04/01/02 + (a) ............. 1,000
8,185 El Paso, Texas, Multi-Family Housing
Finance Corporation, (Viva
Apartments Project), AMT,
General Electric Capital
Corporation Guaranteed,
3.850% 09/01/23 + (a) ............. 8,185
500 Grapevine, Texas, Industrial
Development Corporation Revenue,
(American Airlines), Series A1,
Morgan Guaranty Trust LOC,
4.100% 12/01/24 ++ ................ 500
1,300 Harris (County of), Texas, Health
Facilities Development Corporation,
Hospital Revenue, (Methodist
Hospital), Morgan Guaranty
Trust SBPA,
4.200% 12/01/26 + ................. 1,300
3,340 Harris (County of), Texas, Industrial
Development Corporation,
Industrial Development Revenue,
(Forged Products Inc. Project),
AMT, Bank One LOC,
4.150% 05/01/03 + (a) ............. 3,340
1,600 Harris (County of), Texas, Industrial
Development Corporation, Pollution
Control Revenue, (Exxon Corporation)
4.150% 03/01/25 + ................. 1,600
3,000 Hillsboro, Texas, Industrial
Development Corporation Revenue,
(Lamcraft LP Project), AMT,
Columbus Bank and Trust LOC,
4.300% 07/01/13 + ................. 3,000
Lone Star, Texas, Airport
Improvement Authority, (American
Airlines Inc. Project),
Royal Bank of Canada LOC:
670 Series A4,
4.100% 12/01/14 ++ ................ 670
400 Series B1,
4.100% 12/01/14 ++ ................ 400
800 Series B3,
4.100% 12/01/14 ++ ................ 800
800 Series B4,
4.100% 12/01/14 ++ ................ 800
700 Series B5,
4.100% 12/01/14 ++ ................ 700
7,600 Montgomery (County of), Texas,
Industrial Development Corporation
Revenue, (Houston Area Research
Center Project), Banque National
de Paris LOC,
3.600% 12/01/15 + ................. 7,600
2,800 North Central Texas, Health Facilities
Development Corporation Revenue,
(Methodist Hospitals Dallas),
Series B, MBIA Insured; and
Rabobank Nederland SBPA,
4.150% 10/01/15 + ................. 2,800
10,200 Port Development Corporation,
(Pasadena Marine Terminal
Company Project),
ABN-AMRO Bank LOC,
4.250% 12/01/04 + (a) ............. 10,200
1,200 Port Port Arthur, Texas, Navigation
District, (Texaco Inc. Project),
4.150% 10/01/24 + ................. 1,200
5,900 Sabine River Authority, Texas,
Pollution Control Revenue, (Texas
Utilities Electric Company Project),
Series A, AMT,
Morgan Guaranty Trust LOC,
4.100% 04/01/30 ++ ................ 5,900
1,000 Southwest Higher Education
Authority Inc., (Southern Methodist
University), Morgan Guaranty LOC
4.100% 07/01/15 + ................. 1,000
8,000 Sulphur Springs, Texas, Industrial
Development Authority,
(Hon Industrial Inc. Project),
Northern Trust LOC,
3.750% 12/01/13 + (a) ............. 8,000
25,000 Texas (State of), Municipal Gas
Corporation, Gas Reserves Revenue,
Sr. Lien, FSA Insured; and
Societe Generale SBPA,
3.850% 01/15/23 + (a) ............. 25,000
3,300 Trinity River Authority, Texas,
Pollution Control Revenue, (Texas
Utilities Company Project), Series A,
AMT, MBIA Insured; and Bank
of New York SBPA,
3.700% 07/01/22 + (a) ............. 3,300
----------
100,945
----------
UTAH - 0.9%
1,900 Murray (City of), Utah, Industrial
Revenue, (Zevex Inc. Project), AMT,
Bank One LOC,
4.150% 10/01/16 + (a) ............. 1,900
3,200 Murray (County of), Utah, Industrial
Development Authority, (Hunter
Douglas Realty Property), AMT,
ABN-AMRO Bank LOC,
4.150% 09/01/14 + (a) ............. 3,200
14,300 Salt Lake (City of), Utah, Health Care
Facilities Revenue (IHC
Health Services), Class A,
Westdeutsche Landesbank SBPA,
3.500% 01/01/20 + ................. 14,300
1,010 Salt Lake (City of), Utah, Pollution
Control Revenue, (Service Station
Holdings Inc. Project), Series B,
British Petroleum Guaranty,
4.200% 08/01/07 ++ ................ 1,010
3,200 West Valley, Utah, Industrial
Development Revenue, (Johnson
Matthey Inc. Project), Canadian
Imperial Bank LOC,
4.250% 12/01/11 + (a) ............. 3,200
----------
23,610
----------
VIRGINIA - 0.9%
2,500 Colonial Heights, Virginia, Industrial
Development Authority, (Philip
Morris Company Project),
3.700% 03/01/05 + (a) ............. 2,500
2,000 Fluvanna (County of), Virginia,
Industrial Development Authority
Revenue, (Edgcomb Metals
Company Project),
Banque National de Paris LOC,
4.000% 12/01/09 + (a) ............. 2,000
3,900 Greensville (County of), Virginia,
Industrial Development Authority,
Pollution Control Revenue,
(Purdue Farms Inc. Project),
AMT, SunTrust Bank LOC,
4.150% 10/01/06 + (a) ............. 3,900
5,200 Newport News, Virginia, Economic
Development Authority,
Multi-Family Revenue, (Jefferson
Port Development), Credit
Suisse LOC
4.050% 11/01/11 + (a) ............. 5,200
1,505 Peninsula Ports, Virginia Coalition,
Terminal Revenue, (Dominion
Terminal Project), Series C, Barclays
Bank LOC
4.100% 07/01/16 + ................. 1,505
2,000 Spotsylvania (County of), Virginia,
Industrial Development Revenue,
(Carlisle Corporation Project),
SunTrust Bank LOC,
4.050% 06/01/08 + (a) ............. 2,000
5,500 Virginia College Building Authority,
Educational Facilities Revenue,
(University of Richmond Project),
Crestar Bank SBPA LOC,
3.600% 11/01/26 + ................. 5,500
----------
22,605
----------
WASHINGTON - 0.1%
2,800 Pierce (County of), Washington,
Housing Authority Revenue,
(Eagles Watch Project),
Key Bank LOC,
3.630% 10/01/20 + ................. 2,800
400 Washington (State of), Health Care
Facilities Authority, (Fred
Hutchinson Cancer Institute),
Series B, Morgan Guaranty Trust
Company LOC,
4.100% 01/01/18 + ................. 400
----------
3,200
----------
WEST VIRGINIA - 1.0%
1,500 Marshall (County of), West Virginia,
Pollution Control Revenue,
British Petroleum Guaranteed,
4.200% 12/01/20 ++ ................ 1,500
23,750 West Virginia (State of), Hospital
Finance Authority, Hospital
Revenue, (St. Mary's Hospital
Project), Bank One LOC,
3.650% 10/01/12 + ................. 23,750
----------
25,250
----------
WISCONSIN - 1.1%
4,000 Menomonee Falls, Wisconsin,
Industrial Development Authority
Revenue, (Jemma LLC Project),
AMT, Bank One LOC,
4.150% 09/01/14 + (a) ............. 4,000
4,750 Pleasant Prairie, Wisconsin, Industrial
Development Authority Revenue,
(Nucon Corporation Project),
AMT, American National Bank &
Trust Company, LOC,
3.800% 02/01/22 + (a) ............. 4,750
3,950 Stevensons Point, Wisconsin, Area
School District, Tax and Revenue
Anticipation Promissory Notes,
4.100% 10/15/98 + ................. 3,950
Wisconsin (State of), Health &
Educational Facilities Authority:
2,800 (Felician Health Care Inc.),
LaSalle National Bank LOC,
3.550% 01/01/19 + ................. 2,800
11,800 (St. Luke's Medical Center),
First National Bank of Chicago LOC,
3.650% 12/01/17 + (a) ............. 11,800
----------
27,300
----------
WYOMING - 0.1%
3,700 Sweetwater (County of), Wyoming,
Pollution Control Revenue,
(Pacificorp Project), Series A,
Credit Suisse First Boston LOC,
3.650% 07/01/15 + ................. 3,700
----------
TOTAL MUNICIPAL BONDS
AND NOTES
(Cost $2,595,538) ................ 2,595,538
----------
<PAGE>
NATIONS FUNDS
Nations Tax Exempt Fund
- ----------------------------------------------------------------------
Statement of New Assets (continued) September 30, 1998 (unaudited)
- ----------------------------------------------------------------------
VALUE
SHARES (000)
- --------------------------------------------------------------
INVESTMENT COMPANIES - 0.0% #
50,000 AIM Tax-Exempt Fund ..................... $ 50
25,000 Federated Tax Exempt Money
Market Fund ............................ 25
----------
TOTAL INVESTMENT COMPANIES
(Cost $75) ............................. 75
==========
TOTAL INVESTMENTS
(Cost $2,595,613*) ................. 99.8% $2,595,613
OTHER ASSETS AND LIABILITIES (NET) ... 0.2
-----
Cash ............................................ 175
Interest and dividends receivable ............... 12,852
Dividends payable ............................... (6,309)
Payable for securities purchased ................ (500)
Investment advisory fee payable ................. (411)
Shareholder servicing and distribution
fee payable ................................... (324)
Administration fee payable ...................... (178)
Accrued trustees' fees payable .................. (118)
Accrued expenses and other liabilities .......... (790)
----------
TOTAL OTHER ASSETS AND LIABILITIES (NET) ........ 4,397
----------
NET ASSETS ......................... 100.0% $2,600,010
===== ==========
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE
Primary A Shares:
($1,995,171,000/1,995,528,293 shares
outstanding) .................................. $ 1.00
==========
Primary B Shares:
($9,290,000/9,290,124 shares
outstanding) .................................. $ 1.00
==========
Investor A Shares:
($181,141,000/181,146,614 shares
outstanding) .................................. $ 1.00
==========
Investor B Shares:
($259,989,000/259,996,042 shares
outstanding) .................................. $ 1.00
==========
Investor C Shares:
($41,319,000/41,319,950 shares
outstanding) .................................. $ 1.00
==========
Daily Shares:
($113,100,000/113,115,390 shares
outstanding) .................................. $ 1.00
==========
AT SEPTEMBER 30, 1998, NET ASSETS CONSIST OF:
Paid-in capital ................. $ 2,600,082
Accumulated net realized loss
on investments sold .......... (72)
------------
NET ASSETS $ 2,600,010
============
* Aggregate cost for Federal tax purposes.
+ Variable rate demand notes payable upon not more than seven
calendar days' notice. The interest rate shown reflects the
rate in effect at September 30, 1998.
++ Variable rate demand notes payable upon not more than one
calendar day's notice. The interest rate shown reflects the
rate in effect at September 30, 1998.
+++ Variable rate demand notes payable upon not more than
thirty calendar days' notice. The interest rate shown
reflects the rate in effect at September 30, 1998.
# Amount represents less than 0.1%.
(a) Securities are not registered under the Securities Act of
1933. These securities may be resold in transactions exempt
for registration to qualified institutional buyers.
Nations Tax Exempt Fund had the following industry concentrations greater than
10% at September 30, 1998 (as a percentage of net assets):
Housing Revenue 19.5%
Medical Facilities Revenue 14.1%
Industrial Facilities Revenue 11.2%
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
NATIONS FUNDS
Nations Treasury Fund
- --------------------------------------------------------------
Statement of Net Assets September 30, 1998 (unaudited)
- --------------------------------------------------------------
Nations Tax Exempt Fund
PRINCIPAL
AMOUNT MATURITY VALUE
(000) DATE (000)
--------- -------- -----
U.S. TREASURY NOTES - 19.8%
$ 175,000 5.875%+ .................. 10/31/98 $175,044
125,000 5.875%+ .................. 01/31/99 125,162
50,000 5.000% .................. 02/15/99 50,050
35,000 5.500%+ .................. 02/28/99 34,998
105,000 6.375%+ .................. 04/30/99 105,454
20,000 6.000%+ .................. 06/30/99 20,067
35,000 5.875%+ .................. 07/31/99 35,100
50,000 5.875%+ .................. 08/31/99 50,167
--------
TOTAL U.S. TREASURY NOTES
(Cost $596,042) ................ 596,042
REPURCHASE AGREEMENTS - FIXED RATE - 94.9%
415,000 Agreement with ABN-AMRO Bank,
5.625% dated 09/30/98 to be
repurchased at $415,065 on 10/01/98
collateralized by: $196,090 U.S.
Treasury Note, 4.500% due 09/30/00;
$227,221 U.S. Treasury Bond,
6.375% due 08/15/27 ............... 415,000
325,000 Agreement with ABN-AMRO Bank,
5.640% dated 09/30/98 to be
repurchased at $325,050 on 10/01/98
collateralized by: $185,745 U.S.
Treasury Strips, Interest Only, due
05/15/99-- 05/15/20; $145,755 U.S.
Treasury Strips, Principal Only,
due 05/15/18-- 05/15/20 ........... 325,000
150,000 Agreement with Bear Stearns
Company, 5.700% dated 09/30/98 to
be repurchased at $150,023 on
10/01/98 collateralized by $155,322
GNMA, 6.000% -- 7.000%
due 12/15/23 --08/20/28 ........... 150,000
150,000 Agreement with CIBC Wood Gundy
Securities Corporation, 5.600%
dated 09/30/98 to be repurchased at
$150,023 on 10/01/98 collateralized
by $153,000 GNMA 6.500% due
08/15/27 .......................... 150,000
495,588 Agreement with CS First Boston
Corporation. Interest is payable
monthly. The agreement is
terminable by the Fund daily. The
final maturity date is 10/01/98
collateralized by: $298,869 U.S.
Treasury Strips, Principal Only,
due 11/15/15-- 05/15/20; $212,956
U.S. Treasury Strips, Interest
Only, due 05/15/13 -- 08/15/18 ## . 495,588
20,000 Agreement with Dresdner Bank Inc.,
5.625% dated 09/30/98 to be
repurchased at $20,003 on 10/01/98
collateralized by $20,400 GNMA,
7.000% -- 7.500% due 01/15/25 --
05/15/28 .......................... 20,000
115,000 Agreement with Duetsche Bank,
5.550% dated 09/30/98 to be
repurchased at $115,018 on 10/01/98
collateralized by $117,300 U.S.
Treasury Notes, 6.250% -- 7.500%
due 06/30/00-- 06/30/02 ........... 115,000
150,000 Agreement with First Union
Corporation, 5.700% dated 09/30/98
to be repurchased at $150,023 on
10/01/98 collateralized by:
$103,783 U.S. Treasury Notes,
5.500% -- 8.875% due 10/15/98 --
05/15/07; $14,913 U.S. Treasury
Bills, due 11/05/98 -- 06/24/99;
$33,321 U.S. Treasury Bonds, 5.500%
-- 11.875% due 11/15/03 --
08/15/28; $983 U.S. Treasury Strip,
Principal Only due 02/15/99 ....... 150,000
150,000 Agreement with Goldman, Sachs &
Company, 5.380% dated 09/30/98 to
be repurchased at $150,022 on
10/01/98 collateralized by $153,023
GNMA, 6.000%-- 8.500% due
06/20/23-- 06/15/28 ............... 150,000
150,000 Agreement with HSBC Securities
Corporation, 5.400% dated 09/30/98
to be repurchased at $150,022 on
10/01/98 collateralized by $70,315
U.S. Treasury Bonds, 7.125%--
8.125% due 08/15/19-- 02/15/23;
$28,627 U.S. Treasury Note, 5.875%
due 09/30/02; $996 TIGR, Interest
Only, due 02/15/99; $35,365 U.S.
Treasury Strip, Interest Only, due
02/15/17; $17,697 U.S. Treasury
Strip, Principal Only,
due 02/15/15 -- 02/15/27 .......... 150,000
150,000 Agreement with Lehman Brothers Inc.,
5.650% dated 09/30/98 to be
repurchased at $150,023 on 10/01/98
collateralized by: $77,230 U.S.
Treasury Bond, 11.250% due
02/15/15; $75,630 U.S. Treasury
Note, 5.625% due 05/15/08 ......... 150,000
150,000 Agreement with Merrill Lynch, 5.300%
dated 09/30/98 to be repurchased at
$150,022 on 10/01/98 collateralized
by: $153,002 U.S. Treasury Note,
5.750% -- 7.875% due
11/15/00 -- 11/15/04 .............. 150,000
150,000 Agreement with Morgan (J.P.)
Securities Inc., 5.750% dated
09/30/98 to be repurchased at
$150,024 on 10/01/98 collateralized
by $152,034 GNMA, 6.500%--8.500%
due 07/15/19-- 08/15/28 ........... 150,000
140,000 Agreement with Morgan Stanley
Group Inc., 5.520%, dated 09/30/98.
to be repurchased at $140,043 on
10/02/98 collateralized by $144,330
GNMA, 5.000%-- 8.000% due
03/15/23-- 01/20/28 ............... 140,000
150,000 Agreement with Westdeutsche
Landesbanken, Girozentrale, 5.750%
dated 09/30/98 to be repurchased at
$150,024 on 10/01/98 collateralized
by $153,000 GNMA 6.875%-- 7.000%
due 10/20/22-- 01/20/28 ........... 150,000
----------
TOTAL REPURCHASE AGREEMENTS
(Cost $2,860,588) .................. 2,860,588
----------
SHARES
------
INVESTMENT COMPANIES - 1.6%
25,063,000 AIM Treasury Fund .................... $ 25,063
23,454,000 Dreyfus Treasury Cash Management Fund. 23,454
----------
TOTAL INVESTMENT COMPANIES
(Cost $48,517) ..................... 48,517
----------
TOTAL INVESTMENTS
(Cost $3,505,147) .................... 116.3% $3,505,147
OTHER ASSETS AND LIABILITIES (NET) ..... (16.3)
----
Cash ............................................... 1
Interest and dividends receivable .................. 10,346
Payable for reverse repurchase agreements .......... (495,588)
Dividends payable .................................. (4,482)
Investment advisory fee payable .................... (447)
Shareholder servicing and distribution fee payable . (1,257)
Administration fee payable ......................... (195)
Accrued directors' fee payable ..................... (2)
Accrued expenses and other liabilities ............. (103)
----------
TOTAL OTHER ASSETS AND LIABILITIES (NET) ........... (491,727)
----------
NET ASSETS ............................. 100.0% $3,013,420
===== ==========
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE
Primary A Shares:
($661,596,000/661,879,805 shares outstanding) ...... $ 1.00
==========
Primary B Shares:
($20,108,000/20,108,959 shares outstanding) ........ $ 1.00
==========
Investor A Shares:
($1,866,249,000/1,866,928,440 shares outstanding) .. $ 1.00
==========
Investor B Shares:
($336,128,000/336,152,204 shares outstanding) ...... $ 1.00
==========
Investor C Shares:
($4,410,000/4,410,712 shares outstanding) .......... $ 1.00
==========
Daily Shares:
($124,929,000/125,019,286 shares outstanding) ...... $ 1.00
==========
AT SEPTEMBER 30, 1998, NET ASSETS CONSIST OF:
Paid-in capital ........................ $ 3,013,464
Undistributed net investment income .... 10
Accumulated net realized loss
on investments sold ................. (54)
------------
NET ASSETS $ 3,013,420
============
- --------------
* Aggregate cost for Federal tax purposes.
+ Denotes security, or a portion thereof, subject to repurchase
under reverse repurchase agreement as of September 30, 1998
(Note 1).
## Securities segregated as collateral for reverse repurchase
agreement.
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
NATIONS FUNDS
Nations Government Money Market Fund
- ---------------------------------------------------------------
Statement of Net Assets September 30, 1998 (unaudited)
- ---------------------------------------------------------------
PRINCIPAL
AMOUNT MATURITY VALUE
(000) DATE (000)
- ---------------------------------------------------------------
U.S. GOVERNMENT AGENCY OBLIGATIONS - 96.3%
FEDERAL FARM CREDIT BANK - 3.1%
$8,000 Discount note ......... 10/19/98 $ 7,978
1,921 Discount note ......... 02/05/99 1,886
----------
9,864
FEDERAL FARM CREDIT
BANK NOTES - 5.6%
4,605 5.600% ................ 10/01/98 4,605
6,000 5.700% ................ 11/03/98 6,000
7,000 5.650% ................ 01/04/99 6,999
----------
17,604
----------
FEDERAL HOME LOAN BANK - 40.2%
1,774 Discount note ......... 10/01/98 1,774
8,000 Discount note ......... 10/02/98 7,999
8,000 Discount note ......... 10/07/98 7,993
4,798 Discount note ......... 10/14/98 4,789
8,000 Discount note ......... 10/16/98 7,982
10,000 Discount note ......... 10/21/98 9,970
8,000 Discount note ......... 10/30/98 7,965
16,000 Discount note ......... 11/04/98 15,921
9,000 Discount note ......... 11/06/98 8,951
8,000 Discount note ......... 12/02/98 7,930
8,000 Discount note ......... 12/04/98 7,925
7,000 Discount note ......... 12/11/98 6,927
8,000 Discount note ......... 12/23/98 7,903
8,000 Discount note ......... 01/06/99 7,888
6,000 Discount note ......... 01/20/99 5,901
3,730 Discount note ......... 02/03/99 3,663
6,000 Discount note ......... 02/11/99 5,883
----------
127,364
----------
FEDERAL HOME LOAN BANK
FLOATING RATE NOTE - 5.7%
18,000 4.993%+ ............... 12/24/98+++ 17,999
----------
FEDERAL HOME LOAN
BANK NOTES - 25.6%
$ 9,000 5.682% ................ 10/16/98 $ 9,000
5,000 5.579% ................ 01/27/99 4,999
5,000 5.415% ................ 02/10/99 4,999
15,000 5.570% ................ 03/09/99 14,998
10,000 5.570% ................ 04/07/99 9,996
9,000 5.650% ................ 04/09/99 8,999
8,000 5.723% ................ 05/05/99 7,998
12,000 4.890% ................ 06/17/99 11,998
8,000 5.510% ................ 07/06/99 7,994
----------
80,981
STUDENT LOAN MARKETING ASSOCIATION
FLOATING RATE NOTES - 8.6%
14,800 4.733%+ ............... 11/10/98+++ 14,800
4,500 5.033%+ ............... 04/16/99+++ 4,499
8,000 5.390%+ ............... 09/15/99+++ 7,994
----------
27,293
----------
STUDENT LOAN MARKETING ASSOCIATION
NOTES - 7.5%
3,900 5.740% ................ 11/16/98 3,900
14,000 5.400% ................ 02/10/99 13,992
6,000 5.510% ................ 09/16/99 6,000
----------
23,892
----------
TOTAL U.S. GOVERNMENT
AGENCY OBLIGATIONS
(Cost $304,997) ................ 304,997
----------
INVESTMENT COMPANY - 3.4% (Cost $10,696)
10,695,500 Dreyfus Treasury Prime Cash
Management Fund ................ $ 10,696
----------
TOTAL INVESTMENTS
(Cost $315,693*) ................. 99.7% $ 315,693
OTHER ASSETS AND LIABILITIES (NET).. 0.3
-----
Interest and dividends receivable ............. 2,247
Dividends payable ............................. (1,233)
Investment advisory fee payable ............... (47)
Shareholder servicing and distribution
fee payable ................................. (39)
Administration fee payable .................... (22)
Accrued trustees' fees payable ................ (31)
Accrued expenses and other liabilities ........ (38)
----------
TOTAL OTHER ASSETS AND LIABILITIES (NET) ...... 837
----------
NET ASSETS ......................... 100.0% 316,530
===== =======
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE
Primary A Shares:
($202,103,000/202,134,545 shares outstanding).. $ 1.00
==========
Primary B Shares:
($1,699,000/1,698,989 shares outstanding) ..... $ 1.00
==========
Investor A Shares:
($27,307,000/27,311,202 shares outstanding) ... $ 1.00
==========
Investor B Shares:
($79,484,000/79,496,729 shares outstanding) ... $ 1.00
==========
Investor C Shares:
($1,813,000/1,813,728 shares outstanding) ..... $ 1.00
==========
Daily Shares:
($4,124,000/4,124,641 shares outstanding) ..... $ 1.00
==========
AT SEPTEMBER 30, 1998, NET ASSETS CONSIST OF:
Paid-in capital ........................ $ 316,577
Undistributed net investment income .... 13
Accumulated net realized loss
on investments sold ................. (60)
----------
NET ASSETS $ 316,530
==========
- -------
* Aggregate cost for Federal tax purposes.
+ Variable rate security. The interest rate shown reflects
the rate in effect at September 30, 1998.
+++ Reset date. Interest rates reset either daily, weekly or
monthly.
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
NATIONS FUNDS
Nations Prime Fund
- ---------------------------------------------------------------
Statement of Net Assets September 30, 1998 (unaudited)
- ---------------------------------------------------------------
PRINCIPAL
AMOUNT MATURITY VALUE
(000) DATE (000)
----- ---- -----
BANK OBLIGATIONS - 6.5%
CERTIFICATES OF DEPOSIT - DOMESTIC - 0.5%
$36,000 Morgan Guaranty Trust Company,
5.550% ............. 02/02/99 $ 035,968
----------
CERTIFICATES OF DEPOSIT - YANKEE - 6.0%
25,000 ABN-AMRO Bank, (New York),
5.750% ............. 03/31/99 24,993
45,000 Banque Nationale de Paris, (New York),
5.710% ............. 02/25/99 45,000
30,000 Bayerische Landesbank AG, (New York),
4.940% ............. 10/06/98 30,000
45,000 Bayerische Vereinsbank, (New York),
5.680% ............. 01/21/99 45,000
50,000 Credit Agricole, (New York),
5.750% ............. 04/01/99 49,988
10,000 CS First Boston,
5.800% ............. 10/13/98 10,000
National Bank of Canada, (New York):
30,000 5.940% ............. 12/03/98 30,000
35,000 5.640% ............. 01/05/99 35,000
Societe Generale, (New York):
30,000 5.950% ............. 10/21/98 29,999
35,000 5.700% ............. 02/26/99 34,994
18,000 5.800% ............. 03/31/99 17,996
30,000 5.750% ............. 04/16/99 29,986
40,000 Westdeutsche Landesbanken,
Girozentrale, (New York),
5.680% ............. 01/25/99 40,000
----------
422,956
----------
TOTAL BANK OBLIGATIONS
(Cost $458,924) 458,924
----------
CORPORATE OBLIGATIONS - 67.2%
COMMERCIAL PAPER - DOMESTIC - 37.0%
50,000 Alex Brown Inc.,
Discount note ...... 12/15/98 49,427
AON Corporation:
15,000 Discount note ...... 10/14/98 14,970
18,272 Discount note ...... 10/15/98 18,233
15,000 Discount note ...... 10/19/98 14,958
16,000 Discount note ...... 10/21/98 15,951
20,906 Discount note ...... 10/23/98 20,835
27,956 Discount note ...... 10/28/98 27,840
Bankers Trust New York Corporation:
40,000 Discount note ...... 10/28/98 39,838
30,000 Discount note ...... 11/24/98 29,753
Concord Minutemen Capital Corporation:
25,334 Discount note (b) .. 10/06/98 25,314
84,878 Discount note (b) .. 10/07/98 84,800
70,637 Discount note (b) .. 10/15/98 70,484
25,789 Discount note (b) .. 10/16/98 25,730
20,009 Discount note (b) .. 10/20/98 19,950
15,000 Countrywide Home Loans Inc.,
Discount note ...... 10/01/98 15,000
75,000 Edison Securitization LLC,
Discount note (b) .. 10/01/98 75,000
Finova Capital Corporation:
11,000 Discount note ...... 10/23/98 10,963
15,000 Discount note ...... 10/28/98 14,938
15,000 Discount note ...... 11/24/98 14,876
250,000 General Motors Acceptance Corporation,
Discount note ...... 10/01/98 250,000
Hitachi America:
25,000 Discount note ...... 11/24/98 24,793
21,000 Discount note ...... 12/16/98 20,755
10,000 Discount note ...... 04/13/99 9,704
13,000 Discount note ...... 05/11/99 12,563
17,000 Discount note ...... 05/14/99 16,424
International Securitization Corporation:
31,000 Discount note (a) .. 10/16/98 30,928
50,000 Discount note (a) .. 10/27/98 49,799
18,796 Discount note (a) .. 12/17/98 18,574
Lehman Brothers Holdings Inc.:
30,000 Discount note ...... 10/27/98 29,877
50,000 Discount note ...... 11/16/98 49,644
40,000 Discount note ...... 12/21/98 39,501
82,484 Lexington Parker Capital Company LLC,
Discount note (b) .. 10/15/98 82,305
17,510 Liberty Lighthouse Funding Company LLC,
Discount note (b) .. 10/07/98 17,494
Mitsubishi International Corporation:
10,000 Discount note ...... 10/09/98 9,987
35,000 Discount note ...... 10/13/98 34,934
20,000 Discount note ...... 10/14/98 19,960
59,000 Discount note ...... 10/20/98 58,824
70,000 Discount note ...... 10/30/98 69,685
40,000 Discount note ...... 11/03/98 39,795
15,000 Discount note ...... 11/06/98 14,912
45,000 Discount note ...... 11/10/98 44,710
65,000 Discount note ...... 11/16/98 64,530
30,000 National Bank of Canada, (New York),
Discount note ...... 12/31/98 29,591
11,000 Newell Company Inc.,
Discount note (b) .. 10/01/98 11,000
PHH Corporation:
10,000 Discount note ...... 10/14/98 9,979
25,200 Discount note ...... 11/18/98 25,009
15,000 Discount note ...... 11/18/98 14,887
15,000 Discount note ...... 12/09/98 14,839
17,000 Discount note ...... 01/21/99 16,702
SAFECO Corporation:
55,250 Discount note (b) .. 10/19/98 55,097
17,000 Discount note (b) .. 10/20/98 16,950
14,000 Discount note (b) .. 10/26/98 13,946
50,000 Discount note (b) .. 10/30/98 49,777
25,000 Discount note ...... 11/12/98 24,839
20,000 Discount note (b) .. 11/12/98 19,871
20,000 Discount note (b) .. 11/17/98 19,856
31,000 Discount note ...... 11/19/98 30,766
13,000 Discount note ...... 11/23/98 12,895
13,000 Discount note (b) .. 12/02/98 12,877
25,000 Discount note ...... 12/04/98 24,755
Sumitomo Corporation of America:
18,000 Discount note ...... 10/07/98 17,983
20,000 Discount note ...... 10/21/98 19,938
20,000 Discount note ...... 11/18/98 19,851
10,000 Discount note ...... 11/19/98 9,924
10,000 Discount note ...... 12/02/98 9,904
15,000 Discount note ...... 12/11/98 14,837
Tulip Funding Corporation:
106,000 Discount note (b) .. 10/28/98 105,560
42,622 Discount note (b) .. 10/29/98 42,438
UBS Finance Inc.,
246,000 Discount note ...... 10/01/98 246,000
Variable Funding Capital Corporation:
107,000 Discount note (b) .. 10/01/98 107,000
34,592 Discount note (b) .. 10/20/98 34,490
----------
2,630,119
----------
COMMERCIAL PAPER - EURO - 0.8%
40,000 Abby National Treasury Services PLC,
5.700% ............. 01/28/99 40,000
15,000 Burmah Castrol Finance PLC,
Discount note (b) .. 11/16/98 14,894
----------
54,894
----------
CORPORATE BONDS & NOTES - 29.4%
Bankers Trust Company of New York:
40,000 5.670%+(b) ......... 02/26/99+++ 39,992
20,000 5.770%+(b) ......... 04/28/99+++ 19,986
32,000 5.780%+(b) ......... 04/28/99+++ 31,991
40,000 5.530%+(b) ......... 04/30/99+++ 39,986
60,000 5.590%+(b) ......... 08/06/99+++ 59,995
50,000 5.605%+(b) ......... 09/14/99+++ 50,000
50,000 Bear Stearns & Company Inc.,
5.497%+ ............ 07/28/99+++ 50,000
25,000 Chase Manhattan Corporation,
5.685% ............. 08/03/99 24,987
60,000 Comerica Bank,
5.083%+ ............ 10/06/98+++ 60,000
Credit Suisse First Boston Mortgage
Capital LLC:
46,000 5.153%+(b) ......... 10/30/98+++ 46,000
35,000 5.600%+(b) ......... 05/17/99+++ 35,000
15,000 5.600%+(b) ......... 05/17/99+++ 15,000
Goldman Sachs Group LP, (The):
200,000 5.615% ............. 11/09/98 200,000
50,000 5.438%+(b) ......... 03/26/99+++ 50,000
Lehman Brothers Holdings Inc.:
30,000 5.243% ............. 01/13/99 30,000
100,000 5.660% ............. 01/13/99 100,000
60,000 5.530% ............. 03/23/99 60,000
40,000 5.750% ............. 03/26/99 40,000
50,000 Lexington Parker Capital Company LLC,
5.575% (b) ......... 04/27/99 50,000
Liberty Lighthouse Funding Company LLC:
25,000 5.760% (b) ......... 07/23/99 24,998
50,000 5.590% (b) ......... 08/06/99 50,000
50,000 5.590% (b) ......... 08/27/99 50,000
50,000 5.700% (b) ......... 09/15/99 49,991
50,000 5.700% (b) ......... 09/15/99 49,991
25,000 5.700% (b) ......... 09/15/99 25,000
50,000 Medium Term Structured Household Inc.,
5.590% ............. 10/15/98 50,000
Merrill Lynch & Company Inc.:
95,000 5.143%+ ............ 10/29/98+++ 95,000
50,000 5.143% ............. 11/25/98 50,000
50,000 5.428% ............. 05/11/99 50,000
80,000 5.590% ............. 06/11/99 80,000
Morgan (J.P.) and Company Inc.,
30,000 5.750% ............. 03/10/99 30,000
Morgan Stanley Dean Witter and
Discover Company:
40,000 5.638%+ ............ 01/15/99+++ 39,998
50,000 5.600% ............. 03/15/01 50,000
PHH Corporation:
40,000 5.143% ............. 10/27/98 40,000
25,000 5.565% ............. 02/10/99 24,987
50,000 5.695% ............. 06/14/99 50,000
60,000 5.665% ............. 07/06/99 59,995
Philip Morris Companies Inc.:
41,755 7.375% ............. 02/15/99 41,986
18,000 8.625% ............. 03/01/99 18,200
40,000 Sigma Finance Corporation,
5.158% (b) ......... 11/17/98 40,000
Societe Generale:
100,000 5.525% ............. 06/01/99+++ 99,937
15,000 5.523%+ ............ 08/11/99+++ 14,992
----------
2,088,012
----------
TOTAL CORPORATE OBLIGATIONS
(Cost $4,773,025) ............. 4,773,025
----------
GUARANTEED INVESTMENT CONTRACTS - 10.5%
Allstate Life Insurance Company:
25,000 5.816% **+ ......... 11/01/98 # 25,000
25,000 5.816% **+ ......... 12/01/98 # 25,000
Anchor National Life Insurance Company:
50,000 5.740%**+ .......... 12/29/98 # 50,000
25,000 5.759%**+ .......... 12/29/98 # 25,000
Commonwealth Life Insurance
Company Inc.:
50,000 5.730% **+ ......... 10/01/98+++ 50,000
62,000 5.880% **+ ......... 03/29/99 # 62,000
10,000 5.880% **+ ......... 03/29/99 # 10,000
50,000 First Allmerica Financial Life Insurance
Company,
5.760% **+ ......... 12/29/98 # 50,000
General American Life Insurance Company:
50,000 5.850% **+ ......... 10/07/98 # 50,000
50,000 5.850% **+ ......... 10/07/98 # 50,000
60,000 Life Insurance Company of Georgia,
5.799% **+ ......... 03/29/99 # 60,000
Life Insurance Company of Virginia:
50,000 5.618% **+ ......... 10/07/98 # 50,000
25,000 5.618% **+ ......... 10/07/98 # 25,000
25,000 5.618% **+ ......... 10/07/98 # 25,000
50,000 New York Life Insurance Company,
5.679% **+ ......... 10/07/98 # 50,000
Peoples Security Life Insurance Company:
20,000 5.830% **+ ......... 10/01/98+++ 20,000
20,000 5.880% **+ ......... 12/25/98 # 20,000
50,000 Sun Life Insurance Company of America,
5.789% **+ ......... 03/29/99 # 50,000
Travelers Life Insurance Company:
25,000 5.695% **+ ......... 10/01/98+++ 25,000
25,000 5.645% **+ ......... 10/31/98+++ 25,000
----------
TOTAL GUARANTEED
INVESTMENT CONTRACTS
(Cost $747,000) ............... 747,000
----------
MUNICIPAL BONDS - 2.4%
28,800 Illinois (State of), Student Assistance
Commission, First National Bank
of Chicago LOC,
5.600%+ ............ 05/01/10+++ 28,800
24,800 Indiana (State of), Financing
Authority, Economic Development
Revenue, Qualitech Steel,
National City Bank, Indiana LOC,
5.600%+ ............ 09/01/16+++ 24,800
20,600 Missouri (State of), Economic
Development Revenue, Export and
Infrastructure Board, (Biocraft
Laboratories Inc. Project), PNC
Bank LOC,
5.600%+ ............ 09/01/04+++ 20,600
100,000 Virginia (State of), Housing
Development Authority,
5.600%+ ............ 01/01/46+++ 100,000
----------
TOTAL MUNICIPAL BONDS
(Cost $174,200) ............... 174,200
----------
U.S. GOVERNMENT OBLIGATIONS - 0.8%
Student Loan Marketing Association
Floating Rate Notes:
12,000 4.733%+ ............ 11/10/98+++ 12,000
47,500 4.753%+ ............ 01/13/98+++ 47,480
----------
TOTAL U.S. GOVERNMENT
OBLIGATIONS
(Cost $59,480) ................ 59,480
----------
TIME DEPOSITS - EURO - 4.9%
50,000 Societe Generale,
6.000% ............. 10/01/98 50,000
300,000 Westdeutsche Landesbanken,
Girozentrale
5.875% ............. 10/01/98 300,000
----------
TOTAL TIME DEPOSITS - EURO
(Cost $350,000) ............... 350,000
----------
REPURCHASE AGREEMENTS - 5.7%
100,000 Agreement with Credit Suisse First
Boston Mortgage Capital LLC,
5.750% dated 09/30/98 to be
repurchased at $100,016 on
10/01/98 collateralized by:
$103,410 FNMA,6.150%
due 08/18/08 .................. 100,000
30,000 Agreement with Goldman Sachs,
5.800% dated 09/30/98 to be
repurchased at $30,004 on
10/01/98 collateralized by:
$30,768 Novartis Finance
Coporation Commercial Paper,
5.300% due 10/07/98 ........... 30,000
270,000 Agreement with Morgan, (J.P.),
5.850% dated 09/30/98 to be
repurchased at $270,043 on
10/01/98 collateralized by:
$248,750 J.P. Morgan commercial
paper discount note due
03/30/99; $26,650 J.P. Morgan
commercial paper
discount note due 01/28/99 .... 270,000
----------
TOTAL REPURCHASE AGREEMENTS
(Cost $400,000) ............... 400,000
==========
SHARES
-------------------------------------------------------------
INVESTMENT COMPANIES - 1.7%
67,965,000 AIM Liquid Asset Portfolio ...... $ 67,965
2,917,000 AIM Prime Fund .................. 2,917
47,837,000 Dreyfus Cash Management
Plus Fund ..................... 47,837
----------
TOTAL INVESTMENT COMPANIES
(Cost $118,719) ............... 118,719
----------
TOTAL INVESTMENTS
(Cost $7,081,348*) ............... 99.7% $7,081,348
OTHER ASSETS AND LIABILITIES (NET).. 0.3
----
Cash .......................................... 42
Interest and dividends receivable ............. 42,359
Receivable for Fund shares sold ............... 927
Dividends payable ............................. (15,031)
Investment advisory fee payable ............... (1,113)
Shareholder servicing and distribution
fee payable ................................. (2,519)
Administration fee payable .................... (474)
Accrued directors' fee payable ................ (273)
Accrued expenses and other liabilities ........ (624)
----------
TOTAL OTHER ASSETS AND LIABILITIES (NET) ...... 23,294
----------
NET ASSETS ......................... 100.0% $7,104,642
===== ==========
NET ASSET VALUE, OFFERING AND REDEMPTION PRICE PER SHARE
Primary A Shares:
($2,621,743,000/2,622,176,427 shares outstanding) $ 1.00
==========
Primary B Shares:
($28,278,000/28,281,699 shares outstanding) ... $ 1.00
==========
Investor A Shares:
($2,989,488,000/2,989,662,140 shares outstanding) $ 1.00
==========
Investor B Shares:
($634,855,000/634,982,030 shares outstanding).. $ 1.00
==========
Investor C Shares:
($64,660,000/64,665,366 shares outstanding) ... $ 1.00
==========
Daily Shares:
($765,618,000/765,953,820 shares outstanding).. $ 1.00
==========
AT SEPTEMBER 30, L998, NET ASSETS CONSIST OF:
Paid-in capital ...................... $ 7,104,901
Accumulated net realized loss
on investments sold ............... (259)
------------
NET ASSETS $ 7,104,642
============
* Aggregate cost for Federal tax purposes.
** Restricted security (Note 5). Floating/variable rate note.
The interest rate shown reflects the rate in effect at
September 30, 1998. Reset date. Interest rates reset either
daily, weekly, montly, quarterly or semi-annually.
# Security subject to a demand feature which allows the Fund
to put the security back to the issuer within 7 to 180
calendar days.
(a) Securities are not registered under the Securities Act of
1933. These securities may be resold in transactions exempt
from registration to qualified institutional buyers.
(b) Security exempt from registration under Rule 144A of the
Securities Act of 1933. These securities may be resold in
transactions exempt from registration to qualified
institutional buyers.
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
Comprehensive Abbreviation Listing for all 09/30/98 Nations Money Market Funds:
ABBREVIATIONS:
AMBAC American Municipal Bond Assurance Corporation
AMT Alternative Minimum Tax
CFC Cooperative Finance Corporation
FGIC Financial Guaranty Insurance Corporation
FNMA Federal National Mortgage Association
FSA Financial Security Assurance
GNMA Government National Mortgage Association
GO General Obligation
LOC Letter of Credit
MBIA Municple Bond Insurance Association
SBPA Standby Bond Purchase Agreement
TIGR Treasury Investor Growth Receipt
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
NATIONS FUNDS
<TABLE>
- -----------------------------------------------------------------------------------------------------------------------------
Statements of Operations (unaudited)
- -----------------------------------------------------------------------------------------------------------------------------
For the Six Months Ended September 30, 1998
<CAPTION>
GOVERMENT
TAX EXEMPT TREASURY MONEY MARKET PRIME
---------------------------------------------------------
(IN THOUSANDS)
INVESTMENT INCOME:
<S> <C> <C> <C> <C>
Interest ......................................................... $ 48,133 $ 82,852 $ 8,940 $195,658
Dividends ........................................................ -- 397 255 117
-------- -------- -------- --------
Total invesment income ........................................ 48,133 83,249 9,195 195,775
-------- -------- -------- --------
EXPENSES:
Investment advisory fee .......................................... 5,288 2,996 672 6,891
Administration fee ............................................... 1,325 1,487 168 3,422
Transfer agent fee ............................................... 151 225 26 498
Custodian fees ................................................... 77 100 17 184
Legal and audit fees ............................................. 60 87 13 67
Registration and filing fees ..................................... 43 55 33 162
Interest expense ................................................. 3 -- -- --
Trustees'/Directors' fees and expenses ........................... 31 25 4 56
Other ............................................................ 97 61 10 149
-------- -------- -------- --------
Subtotal ...................................................... 7,075 5,036 934 11,429
Shareholder servicing and distribution fees:
Primary B Shares ............................................... 11 14 2 13
Investor A Shares .............................................. 322 2,985 47 4,744
Investor B Shares .............................................. 460 672 149 1,243
Investor C Shares .............................................. 75 9 3 115
Daily Shares ................................................... 275 531 18 1,999
Fees waived by investment advisor, administrator and distributor (3,443) (918) (487) (2,076)
-------- -------- -------- --------
Net Expenses ................................................... 4,775 8,329 675 17,467
-------- -------- -------- --------
NET INVESTMENT INCOME ............................................ 43,358 74,920 8,520 178,308
-------- -------- -------- --------
NET REALIZED GAIN/(LOSS) ON INVESTMENTS .......................... -- (9) -- 17
-------- -------- -------- --------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ............ $ 43,358 $ 74,911 $ 8,520 $178,325
======== ======== ======== ========
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
NATIONS FUNDS
<TABLE>
- -----------------------------------------------------------------------------------------------------------------------------
Statements of Changes in Net Assets
- -----------------------------------------------------------------------------------------------------------------------------
<CAPTION>
TAX EXEMPT TREASURY
--------------------------- ------------------------------
SIX MONTHS SIX MONTHS
ENDED ENDED
09/30/98 YEAR ENDED 09/30/98 YEAR ENDED
(UNAUDITED) 03/31/98 (UNAUDITED) 03/31/98
-------------------------------------------------------------
<S> <C> <C> <C> <C>
(IN THOUSANDS)
Net investment income ............................................ $ 43,358 $ 73,604 $ 74,920 $ 169,377
Net realized gain/(loss) on investments .......................... -- 1 (9) --
----------- ----------- ----------- -----------
Net increase in net assets resulting from operations ............. 43,358 73,605 74,911 169,377
Distributions to shareholders from net investment income:
Primary A Shares ............................................... (34,241) (58,608) (18,915) 64,676)
Primary B Shares ............................................... (141) (344) (298) (1,382)
Investor A Shares .............................................. (2,756) (4,960) (42,177) (57,323)
Investor B Shares .............................................. (4,217) (7,214) (9,715) (38,193)
Investor C Shares .............................................. (923) (2,076) (174) (507)
Daily Shares ................................................... (1,089) (400) (3,641) (7,296)
Net increase/(decrease) in net assets from Fund share transactions 88,552 874,966 291,854 (401,867)
----------- ----------- ----------- -----------
Net increase/(decrease) in net assets ............................ 88,543 874,969 291,846 (401,867)
NET ASSETS:
Beginning of period .............................................. 2,511,466 1,636,497 2,721,575 3,123,442
----------- ----------- ----------- -----------
End of period .................................................... $ 2,600,010 $ 2,511,466 $ 3,013,420 $ 2,721,575
=========== =========== =========== ===========
Undistributed net investment income at end of period ............. $ -- $ 9 $ 10 $ 10
=========== =========== =========== ===========
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
NATIONS FUNDS
<TABLE>
- -----------------------------------------------------------------------------------------------------------------------------
Statements of Changes in Net Assets
- -----------------------------------------------------------------------------------------------------------------------------
<CAPTION>
GOVERNMENT MONEY MARKET PRIME
--------------------------- ------------------------------
SIX MONTHS SIX MONTHS
ENDED ENDED
09/30/98 YEAR ENDED 09/30/98 YEAR ENDED
(UNAUDITED) 03/31/98 (UNAUDITED) 03/31/98
-------------------------------------------------------------
<S> <C> <C> <C> <C>
(IN THOUSANDS)
Net investment income ............................................ $ 8,520 $ 18,385 $ 178,308 $ 296,834
Net realized gain/(loss) on investments .......................... -- 2 17 (12)
----------- ----------- ----------- -----------
Net increase in net assets resulting from operations ............. 8,520 18,387 178,325 296,822
Distributions to shareholders from net investment income:
Primary A Shares ............................................... (5,552) (13,732) (74,576) 181,469)
Primary B Shares ............................................... (42) (839) (263) (3,020)
Investor A Shares .............................................. (648) (1,215) (68,677) (71,233)
Investor B Shares .............................................. (2,096) (2,115) (18,385) (32,993)
Investor C Shares .............................................. (61) (152) (2,377) (4,581)
Daily Shares ................................................... (121) (332) (14,031) (3,536)
Net increase/(decrease) in net assets from Fund share transactions (13,590) (45,196) 1,503,757 1,241,743
----------- ----------- ----------- -----------
Net increase/(decrease) in net assets ............................ (13,590) (45,194) 1,503,773 1,241,733
NET ASSETS:
Beginning of period .............................................. 330,120 375,314 5,600,869 4,359,136
----------- ----------- ----------- -----------
End of period .................................................... $ 316,530 $ 330,120 $ 7,104,642 $ 5,600,869
=========== =========== =========== ===========
Undistributed net investment income at end of period ............. $ 13 $ 13 $ -- $ 1
=========== =========== =========== ===========
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
NATIONS FUNDS
- -------------------------------------------------------------------------------
Statements of Cash Flows (unaudited)
- -------------------------------------------------------------------------------
For the Six Months Ended September 30, 1998
TREASURY
(000)
-----------------------------
Cash flows from operating and investing
activities:
Investment income received ................. $ 81,799
Payment of operating expenses .............. (7,519)
Net purchases of short-term investments .... (310,440)
Cash used by operating and investing activities $ (236,160)
Cash flows from financing activities:
Proceeds from Fund shares sold ............. 4,668,958
Payment for shares redeemed ................ (4,388,126)
Cash provided by reverse repurchase agreement 19,290
Distributions paid * ....................... (63,961)
-----------
Cash provided by financing activities ........ 236,161
-----------
Increase in cash ........................... 1
Cash at beginning of period ................ 0
-----------
Cash at end of period ...................... $ 1
===========
RECONCILIATION OF NET INCREASE IN NET ASSETS
FROM OPERATIONS TO CASH USED BY OPERATING
AND INVESTING ACTIVITIES:
Net increase in net assets resulting from
operations ................................. $ 74,911
Increase in investments .................... $ (309,048)
Increase in interest and dividends receivable (2,832)
Decrease in other assets ................... 172
Increase in accrued expenses ............... 637
-----------
Cash used by operating and investing activities $ (236,160)
===========
- ----------
* Non-cash activities include reinvestment of dividends of $10,669,000.
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
NATIONS FUNDS
<TABLE>
- ---------------------------------------------------------------------------------------------------------------------------------
Schedule of Capital Stock Activity*
- ---------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
TAX EXEMPT TREASURY
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
09/30/98** 03/31/98 09/30/98** 03/31/98
---------------------------------------------------------------
<S> <C> <C> <C> <C>
(IN THOUSANDS)
PRIMARY A SHARES:
Sold ............................................................. $ 1,033,444 $ 1,930,603 $ 287,265 $ 1,681,502
Issued in exchange for Pilot Shares of Pilot (Note 8):
Short-Term U.S. Treasury Fund .................................. -- -- -- 1,227,239
Short-Term Tax Exempt Diversified Fund ......................... -- 374,107 -- --
Missouri Short- Term Tax Exempt Fund ........................... -- 194,197 -- --
Issued in exchange for assets of (Note 8):
Emerald Tax Exempt Fund ........................................ 111,309 -- -- --
Common Trust Municipal Temp Fund ............................... 52,112 -- -- --
Emerald Treasury Money Market Fund ............................. -- -- 280,819 --
Issued as reinvestment of dividends .............................. 1,148 1,082 8 356
Redeemed ......................................................... (1,203,866) (1,683,269) (521,680) (3,639,485)
----------- ----------- ----------- -----------
Net increase/(decrease) .......................................... $ (5,853) $ 816,720 $ 46,412 $ (730,388)
=========== =========== =========== ===========
PRIMARY B SHARES:
Sold ............................................................. $ 16,060 $ 33,933 $ 23,243 $ 119,961
Issued as reinvestment of dividends .............................. -- -- -- 23
Redeemed ......................................................... (14,946) (38,357) (14,899) (163,388)
----------- ----------- ----------- -----------
Net increase/(decrease) .......................................... $ 1,114 $ (4,424) $ 8,344 $ (43,404)
=========== =========== =========== ===========
INVESTOR A SHARES:
Sold ............................................................. $ 278,791 $ 531,649 $ 1,507,478 $ 3,672,012
Issued in exchange for assets of (Note 8):
Emerald Tax Exempt Fund ........................................ 551 -- -- --
Emerald Treasury Money Market Fund ............................. -- -- 518,802 --
Issued as reinvestment of dividends .............................. 2,682 4,811 3,546 4,901
Redeemed ......................................................... (273,236) (509,996) (1,524,761) (3,034,972)
----------- ----------- ----------- -----------
Net increase ..................................................... $ 8,788 $ 26,464 $ 505,065 $ 641,941
=========== =========== =========== ===========
INVESTOR B SHARES:
Sold ............................................................. $ 444,780 $ 726,068 $ 1,546,357 $ 8,652,481
Issued in exchange for Administration Shares of Pilot (Note 8):
Short-Term U.S. Treasury Fund .................................. -- -- -- 237,343
Short-Term Tax Exempt Diversified Fund ......................... -- 10,606 -- --
Missouri Short- Term Tax Exempt Fund ........................... -- 11,941 -- --
Issued as reinvestment of dividends .............................. 3,698 6,340 4,438 12,703
Redeemed ......................................................... (438,334) (733,713) (1,761,518) (9,328,944)
----------- ----------- ----------- -----------
Net increase/(decrease) .......................................... $ 10,144 $ 21,242 $ (210,723) $ (426,417)
=========== =========== =========== ===========
INVESTOR C SHARES:
Sold ............................................................. $ 76,086 $ 201,254 $ 8,743 $ 23,432
Issued as reinvestment of dividends .............................. 893 2,046 171 510
Redeemed ......................................................... (103,180) (198,544) (12,799) (29,515)
----------- ----------- ----------- -----------
Net increase/(decrease) .......................................... $ (26,201) $ 4,756 $ (3,885) $ (5,573)
=========== =========== =========== ===========
DAILY SHARES:
Sold ............................................................. $ 139,070 $ 185,935 $ 420,398 $ 1,965,123
Issued in exchange for Investor Shares of Pilot (Note 8):
Short-Term U.S. Treasury Fund .................................. -- -- -- 155,072
Short-Term Tax Exempt Diversified Fund ......................... -- 7,245 -- --
Missouri Short- Term Tax Exempt Fund ........................... -- 20,642 -- --
Issued in exchange for assets of (Note 8):
Emerald Tax Exempt Fund ........................................ 58,840 -- -- --
Emerald Treasury Money Market Fund ............................. -- -- 75,614 --
Issued as reinvestment of dividends .............................. 1,070 379 2,506 6,888
Redeemed ......................................................... (98,420) (203,993) (551,877) (1,965,109)
----------- ----------- ----------- -----------
Net increase/(decrease) .......................................... $ 100,560 $ 10,208 $ (53,359) $ 161,974
=========== =========== =========== ===========
Total net increase/(decrease) .................................... $ 88,552 $ 874,966 $ 291,854 $ (401,867)
=========== =========== =========== ===========
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
NATIONS FUNDS
<TABLE>
- --------------------------------------------------------------------------------------------------------------------------------
Schedule of Capital Stock Activity (continued)*
- --------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
GOVERNMENT MONEY MARKET PRIME
SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED
09/30/98** 03/31/98 09/30/98** 03/31/98
---------------------------------------------------------------
<S> <C> <C> <C> <C>
(IN THOUSANDS)
PRIMARY A SHARES:
Sold ............................................................. $ 82,142 $ 930,668 $ 1,206,115 $ 4,016,048
Issued in exchange for:
Pilot Shares of Pilot Short-Term
Diversified Assets Fund (Note 8) ............................... -- -- -- 1,539,899
Assets of Emerald Prime Money
Market Fund (Note 8) ........................................... -- -- 351,001 --
Issued as reinvestment of dividends ............................. 6 67 2,632 4,159
Redeemed ........................................................ (97,553) (1,012,632) (1,790,232) (5,241,556)
----------- ----------- ----------- -----------
Net increase/(decrease) ......................................... $ (15,405) $ (81,897) $ (230,484) $ 318,550
=========== =========== =========== ===========
PRIMARY B SHARES:
Sold ............................................................. $ 3,950 $ 136,817 $ 71,883 $ 294,929
Issued as reinvestment of dividends ............................. -- -- -- 42
Redeemed ........................................................ (4,063) (154,457) (51,737) (470,877)
----------- ----------- ----------- -----------
Net increase/(decrease) ......................................... $ (113) $ (17,640) $ 20,146 $ (175,906)
=========== =========== =========== ===========
INVESTOR A SHARES:
Sold ............................................................. $ 34,901 $ 110,875 $ 3,306,537 $ 4,691,456
Issued in exchange for assets of
Emerald Prime Money Market Fund ................................ -- -- 1,222,395 --
Issued as reinvestment of dividends ............................. 627 1,153 45,151 68,508
Redeemed ........................................................ (32,026) (106,939) (3,291,530) (4,210,795)
----------- ----------- ----------- -----------
Net increase .................................................... $ 3,502 $ 5,089 $ 1,282,553 $ 549,169
=========== =========== =========== ===========
INVESTOR B SHARES:
Sold ............................................................. $ 205,597 $ 362,572 $ 2,305,740 $ 4,419,707
Issued in exchange for Administration Shares of Pilot
Short-Term Diversified Assets
Fund (Note 8): ................................................. -- -- -- 239,008
Issued as reinvestment of dividends ............................. 1,516 1,793 17,281 28,891
Redeemed ........................................................ (204,687) (315,047) (2,532,649) (4,224,135)
----------- ----------- ----------- -----------
Net increase/(decrease) ......................................... $ 2,426 $ 49,318 $ (209,628) $ 463,471
=========== =========== =========== ===========
INVESTOR C SHARES:
Sold ............................................................. $ 1,779 $ 6,191 $ 94,928 $ 232,102
Issued as reinvestment of dividends ............................. 61 149 2,287 4,454
Redeemed ........................................................ (3,396) (5,113) (128,717) (234,077)
----------- ----------- ----------- -----------
Net increase/(decrease) ......................................... $ (1,556) $ 1,227 $ (31,502) $ 2,479
=========== =========== =========== ===========
DAILY SHARES:
Sold ............................................................. $ 18,063 $ 119,962 $ 388,067 $ 611,273
Issued in exchange for:
Investor Shares of Short-Term
Diversified Assets Fund (Note 8): .............................. -- -- -- 75,676
Assets of Emerald Prime Money
Market Fund (Note 8) ........................................... -- -- 601,006 --
Issued as reinvestment of dividends ............................. 108 324 13,808 3,483
Redeemed ........................................................ (20,615) (121,579) (330,209) (606,452)
----------- ----------- ----------- -----------
Net increase/(decrease) ......................................... $ (2,444) $ (1,293) $ 672,672 $ 83,980
=========== =========== =========== ===========
Total net increase/(decrease) ................................... $ (13,590) $ (45,196) $ 1,503,757 $ 1,241,743
=========== =========== =========== ===========
* Since the funds have sold, issued as reinvestment of dividends and redeemed shares only at a constant net asset value of
$1.00 per share, the number of shares represented by such sales, reinvestments and redemptions is the same as the amounts
shown below for such transactions.
** Unaudited
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
NATIONS FUNDS
<TABLE>
- ----------------------------------------------------------------------------------------------------------
Financial Highlights
- ----------------------------------------------------------------------------------------------------------
For a Share outstanding throughout each period.
<CAPTION>
NET ASSET DIVIDENDS TOTAL
VALUE NET FROM NET DIVIDENDS
BEGINNING INVESTMENT INVESTMENT AND
OF YEAR INCOME INCOME DISTRIBUTIONS
------------------------------------------------------------
<S> <C> <C> <C> <C>
TAX EXEMPT:
PRIMARY A SHARES
Six months ended 09/30/1998 +++ ........ $ 1.00 $ 0.0172 $ (0.0172) $ (0.0172)
Year ended 03/31/1998 .................. 1.00 0.0345 (0.0345) (0.0345)
Year ended 03/31/1997 .................. 1.00 0.0324 (0.0324) (0.0324)
Period ended 03/31/1996 (a) ............ 1.00 0.0112 (0.0112) (0.0112)
Year ended 11/30/1995 .................. 1.00 0.0361 (0.0361) (0.0361)
Year ended 11/30/1994 .................. 1.00 0.0257 (0.0257) (0.0257)
Year ended 11/30/1993 .................. 1.00 0.0223 (0.0223) (0.0223)
PRIMARY B SHARES
Six months ended 09/30/1998 +++ ........ $ 1.00 $ 0.0154 $ (0.0154) $ (0.0154)
Year ended 03/31/1998 .................. 1.00 0.0320 (0.0320) (0.0320)
Year ended 03/31/1997 .................. 1.00 0.0300 (0.0300) (0.0300)
Period ended 03/31/1996 (a) ............ 1.00 0.0104 (0.0104) (0.0104)
Year ended 11/30/1995 .................. 1.00 0.0335 (0.0335) (0.0335)
Period ended 11/30/1994 * .............. 1.00 0.0116 (0.0116) (0.0116)
INVESTOR A SHARES
Six months ended 09/30/1998 +++ ........ $ 1.00 $ 0.0152 $ (0.0152) $ (0.0152)
Year ended 03/31/1998 .................. 1.00 0.0316 (0.0316) (0.0316)
Year ended 03/31/1997 .................. 1.00 0.0300 (0.0300) (0.0300)
Period ended 03/31/1996 (a) ............ 1.00 0.0104 (0.0104) (0.0104)
Year ended 11/30/1995 .................. 1.00 0.0335 (0.0335) (0.0335)
Year ended 11/30/1994 .................. 1.00 0.0231 (0.0231) (0.0231)
Year ended 11/30/1993 .................. 1.00 0.0198 (0.0198) (0.0198)
INVESTOR B SHARES
Six months ended 09/30/1998 +++ ........ $ 1.00 $ 0.0163 $ (0.0163) $ (0.0163)
Year ended 03/31/1998 .................. 1.00 0.0325 (0.0325) (0.0325)
Year ended 03/31/1997 .................. 1.00 0.0307 (0.0307) (0.0307)
Period ended 03/31/1996 (a) ............ 1.00 0.0106 (0.0106) (0.0106)
Year ended 11/30/1995 .................. 1.00 0.0342 (0.0342) (0.0342)
Period ended 11/30/1994 * .............. 1.00 0.0141 (0.0141) (0.0141)
INVESTOR C SHARES
Six months ended 09/30/1998 +++ ........ $ 1.00 $ 0.0223 $ (0.0223) $ (0.0223)
Year ended 03/31/1998 .................. 1.00 0.0323 (0.0323) (0.0323)
Year ended 03/31/1997 .................. 1.00 0.0311 (0.0311) (0.0311)
Period ended 03/31/1996 (a) ............ 1.00 0.0107 (0.0107) (0.0107)
Year ended 11/30/1995 .................. 1.00 0.0346 (0.0346) (0.0346)
Period ended 11/30/1994 * .............. 1.00 0.0203 (0.0203) (0.0203)
DAILY SHARES
Six months ended 09/30/1998 +++ ........ $ 1.00 $ 0.0099 $ (0.0099) $ (0.0099)
Year ended 03/31/1998 .................. 1.00 0.0295 (0.0295) (0.0295)
Year ended 03/31/1997 .................. 1.00 0.0270 (0.0270) (0.0270)
Period ended 03/31/1996 (a) ............ 1.00 0.0090 (0.0090) (0.0090)
Period ended 11/30/1995 * .............. 1.00 0.0243 (0.0243) (0.0243)
- ------------
* Tax Exempt Primary A, Primary B, Investor A, Investor B, Investor C and Daily Shares commenced
operations on March 14, 1988, June 16, 1994, April 5, 1991, May 17, 1994, March 7, 1994 and February
10, 1995, respectively.
+ Annualized.
++ Total return represents aggregate total return for the period indicated and does not reflect the
deduction on any applicable sales charges.
+++ Unaudited.
(a) Fiscal year end changed to March 31. Prior to this, the fiscal year end was November 30.
(b) The effect of interest expense on the operating expense ratio was less than 0.01%
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
NATIONS FUNDS
<TABLE>
- -------------------------------------------------------------------------------------------------
Financial Highlights (continued)
- -------------------------------------------------------------------------------------------------
<CAPTION>
RATIO TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
---------------------------------------------
OPERATING
EXPENSES
NET ASSET NET ASSETS WITHOUT
VALUE END OF WAIVERS
END OF TOTAL YEAR OPERATING NET INVESTMENT AND/OR
YEAR RETURN++ (000) EXPENSES INCOME REIMBURSEMENTS
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
$ 1.00 1.70% $ 1,995,171 0.30%+(b) 3.36%+(b) 0.51%+
1.00 3.48 2,001,083 0.30(b) 3.43(b) 0.56
1.00 3.29 1,184,313 0.30 3.25 0.55
1.00 1.12 1,078,764 0.30+ 3.35+ 0.58+
1.00 3.68 905,125 0.30 3.62 0.59
1.00 2.60 820,677 0.27 2.59 0.59
1.00 2.27 701,403 0.23 2.23 0.59
$ 1.00 1.56% $ 9,290 0.55%+(b) 3.11%+(b) 0.76%+
1.00 3.22 8,726 0.55(b) 3.18(b) 0.81
1.00 3.04 13,151 0.55 3.00 0.80
1.00 1.04 9,370 0.55+ 3.10+ 0.83+
1.00 3.39 11,666 0.55 3.37 0.82
1.00 1.17 18,207 0.52+ 2.34+ 0.84+
$ 1.00 1.53% $ 181,141 0.65%+(b) 3.01%+(b) 0.86%+
1.00 3.20 171,786 0.58(b) 3.15(b) 0.84
1.00 3.04 145,337 0.55 3.00 0.80
1.00 1.04 128,414 0.55+ 3.10+ 0.83+
1.00 3.40 126,207 0.55 3.37 0.82
1.00 2.36 151,714 0.52 2.34 0.84
1.00 2.00 119,552 0.48 1.98 0.84
$ 1.00 1.59% $ 259,989 0.50%+(b) 3.16%+(b) 0.86%+
1.00 3.30 249,819 0.50(b) 3.23(b) 0.76
1.00 3.11 228,601 0.50 3.05 0.75
1.00 1.06 132,914 0.50+ 3.15+ 0.78+
1.00 3.47 86,374 0.50 3.42 0.77
1.00 1.43 3 0.47+ 2.39+ 0.79+
$ 1.00 1.56% $ 41,319 0.55%+(b) 3.11%+(b) 0.76%+
1.00 3.26 67,511 0.48(b) 3.25(b) 0.74
1.00 3.15 62,761 0.45 3.10 0.70
1.00 1.07 66,743 0.45+ 3.20+ 0.73+
1.00 3.52 41,409 0.45 3.47 0.72
1.00 2.05 25,704 0.42+ 2.44+ 0.74+
$ 1.00 1.44% $ 113,100 0.80%+(b) 2.86%+(b) 1.21%+
1.00 2.98 12,541 0.80(b) 2.93(b) 1.06
1.00 2.73 2,334 0.80 2.75 1.05
1.00 0.91 2 0.69+ 2.96+ 0.97+
1.00 2.61 2 0.45+ 3.47+ 0.72+
</TABLE>
<PAGE>
NATIONS FUNDS
<TABLE>
- ----------------------------------------------------------------------------------------------------------
Financial Highlights
- ----------------------------------------------------------------------------------------------------------
For a Share outstanding throughout each period.
<CAPTION>
NET ASSET DIVIDENDS TOTAL
VALUE NET FROM NET DIVIDENDS
BEGINNING INVESTMENT INVESTMENT AND
OF YEAR INCOME INCOME DISTRIBUTIONS
------------------------------------------------------------
<S> <C> <C> <C> <C>
TREASURY:
PRIMARY A SHARES
Six months ended 09/30/1998 +++ ........ $ 1.00 $ 0.0267 $ (0.0267) $ (0.0267)
Year ended 03/31/1998 .................. 1.00 0.0531 (0.0531) (0.0531)
Year ended 03/31/1997 .................. 1.00 0.0509 (0.0509) (0.0509)
Period ended 03/31/1996 (a) ............ 1.00 0.0458 (0.0458)# (0.0458)
Year ended 05/31/1995 .................. 1.00 0.0494 (0.0494)# (0.0494)
Year ended 05/31/1994 .................. 1.00 0.0297 (0.0297) (0.0297)
Year ended 05/31/1993 .................. 1.00 0.0307 (0.0307) (0.0307)
PRIMARY B SHARES
Six months ended 09/30/1998 +++ ........ $ 1.00 $ 0.0253 $ (0.0253) $ (0.0253)
Year ended 03/31/1998 .................. 1.00 0.0506 (0.0506) (0.0506)
Year ended 03/31/1997 .................. 1.00 0.0484 (0.0484) (0.0484)
Period ended 03/31/1996 (a) ............ 1.00 0.0437 (0.0437)# (0.0437)
Period ended 05/31/1995 * .............. 1.00 0.0449 (0.0449)# (0.0449)
INVESTOR A SHARES
Six months ended 09/30/1998 +++ ........ $ 1.00 $ 0.0248 $ (0.0248) $ (0.0248)
Year ended 03/31/1998 .................. 1.00 0.0496 (0.0496) (0.0496)
Year ended 03/31/1997 .................. 1.00 0.0474 (0.0474) (0.0474)
Period ended 03/31/1996 (a) ............ 1.00 0.0429 (0.0429)# (0.0429)
Year ended 05/31/1995 .................. 1.00 0.0457 (0.0457)# (0.0457)
Year ended 05/31/1994 .................. 1.00 0.0262 (0.0262) (0.0262)
Year ended 05/31/1993 .................. 1.00 0.0272 (0.0272) (0.0272)
INVESTOR B SHARES
Six months ended 09/30/1998 +++ ........ $ 1.00 $ 0.0253 $ (0.0253) $ (0.0253)
Year ended 03/31/1998 .................. 1.00 0.0506 (0.0506) (0.0506)
Year ended 03/31/1997 .................. 1.00 0.0484 (0.0484) (0.0484)
Period ended 03/31/1996 (a) ............ 1.00 0.0437 (0.0437)# (0.0437)
Year ended 05/31/1995 .................. 1.00 0.0468 (0.0468)# (0.0468)
Period ended 05/31/1994 * .............. 1.00 0.0015 (0.0015) (0.0015)
INVESTOR C SHARES
Six months ended 09/30/1998 +++ ........ $ 1.00 $ 0.0253 $ (0.0253) $ (0.0253)
Year ended 03/31/1998 .................. 1.00 0.0506 (0.0506) (0.0506)
Year ended 03/31/1997 .................. 1.00 0.0484 (0.0484) (0.0484)
Period ended 03/31/1996 (a) ............ 1.00 0.0437 (0.0437)# (0.0437)
Year ended 05/31/1995 .................. 1.00 0.0468 (0.0468)# (0.0468)
Period ended 05/31/1994 * .............. 1.00 0.0019 (0.0019) (0.0019)
DAILY SHARES
Six months ended 09/30/1998 +++ ........ $ 1.00 $ 0.0241 $ (0.0241) $ (0.0241)
Year ended 03/31/1998 .................. 1.00 0.0481 (0.0481) (0.0481)
Year ended 03/31/1997 .................. 1.00 0.0455 (0.0455) (0.0455)
Period ended 03/31/1996 (a) ............ 1.00 0.0404 (0.0404) (0.0404)
Period ended 05/31/1995 * .............. 1.00 0.0167 (0.0167) (0.0167)
- -----------
* Treasury primary B, Investor A, Investor B, Investor C and Daily Shares commenced operations on June
16, 1994, July 16, 1990, May 16, 1994, May 11, 1994 and February 9, 1995, respectively.
+ Annualized.
++ Total return represents aggregate total return for the period indicated and does not reflect the
deduction on any applicable sales charges.
+++ Unaudited.
# Amount includes distributions from net realized gains of less than $0.0001 per share.
(a) Fiscal year end changed to March 31. Prior to this, the fiscal year end was May 31.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
NATIONS FUNDS
<TABLE>
- -------------------------------------------------------------------------------------------------
Financial Highlights (continued)
- -------------------------------------------------------------------------------------------------
<CAPTION>
RATIO TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
---------------------------------------------
OPERATING
EXPENSES
NET ASSET NET ASSETS WITHOUT
VALUE END OF WAIVERS
END OF TOTAL YEAR OPERATING NET INVESTMENT AND/OR
YEAR RETURN++ (000) EXPENSES INCOME REIMBURSEMENTS
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
$ 1.00 2.69% $ 661,596 0.30%+ 5.13%+ 0.34%+
1.00 5.43 615,185 0.30 5.31 0.35
1.00 5.22 1,345,585 0.30 5.09 0.35
1.00 4.67 821,030 0.30+ 5.52+ 0.37+
1.00 5.05 2,896,868 0.30 4.99 0.35
1.00 2.99 2,679,992 0.30 2.97 0.36
1.00 3.12 2,956,796 0.30 3.02 0.36
$ 1.00 2.57% $ 20,108 0.55%+ 4.88%+ 0.59%+
1.00 5.18 11,764 0.55 5.06 0.60
1.00 4.96 55,170 0.55 4.84 0.60
1.00 4.46 47,488 0.55 5.27+ 0.62+
1.00 4.56 56,815 0.55 4.74+ 0.60+
$ 1.00 2.51% $ 1,866,249 0.65%+ 4.78%+ 0.69%+
1.00 5.06 1,361,214 0.65 4.96 0.70
1.00 4.85 719,199 0.65 4.74 0.70
1.00 4.36 89,584 0.65 5.17 0.72+
1.00 4.65 107,475 0.67 4.62 0.72
1.00 2.67 74,195 0.65 2.62 0.71
1.00 2.77 105,828 0.65 2.67 0.71
$ 1.00 2.57% $ 336,128 0.55%+ 4.88%+ 0.69%+
1.00 5.18 546,833 0.55 5.06 0.60
1.00 4.96 973,297 0.55 4.84 0.60
1.00 4.46 1,525,048 0.55+ 5.27+ 0.62+
1.00 4.76 52,564 0.56 4.73 0.61
1.00 0.14 2 0.55+ 2.72+ 0.61+
$ 1.00 2.57% $ 4,410 0.55%+ 4.88%+ 0.59%+
1.00 5.18 8,295 0.55 5.06 0.60
1.00 4.96 13,868 0.55 4.84 0.60
1.00 4.46 8,783 0.55+ 5.27+ 0.62+
1.00 4.76 6,373 0.56 4.73 0.61
1.00 0.19 191 0.55+ 2.72+ 0.61+
$ 1.00 2.44% $ 124,929 0.80%+ 4.63%+ 1.04%+
1.00 4.92 178,284 0.80 4.81 0.85
1.00 4.66 16,323 0.80 4.59 0.85
1.00 4.09 2 0.64+ 5.18+ 0.71+
1.00 1.67 2 0.55+ 4.74+ 0.60+
</TABLE>
<PAGE>
NATIONS FUNDS
<TABLE>
- ----------------------------------------------------------------------------------------------------------
Financial Highlights
- ----------------------------------------------------------------------------------------------------------
For a Share outstanding throughout each period.
<CAPTION>
NET ASSET DIVIDENDS TOTAL
VALUE NET FROM NET DIVIDENDS
BEGINNING INVESTMENT INVESTMENT AND
OF YEAR INCOME INCOME DISTRIBUTIONS
------------------------------------------------------------
<S> <C> <C> <C> <C>
GOVERNMENT MONEY MARKET:
PRIMARY A SHARES
Six months ended 09/30/1998 +++ ........ $ 1.00 $ 0.0259 $ (0.0259) $ (0.0259)
Year ended 03/31/1998 .................. 1.00 0.0524 (0.0524) (0.0524)
Year ended 03/31/1997 .................. 1.00 0.0503 (0.0503) (0.0503)
Period ended 03/31/1996 (a) ............ 1.00 0.0173 (0.0173) (0.0173)
Year ended 11/30/1995 .................. 1.00 0.0558 (0.0558) (0.0558)
Year ended 11/30/1994 .................. 1.00 0.0375 (0.0375)# (0.0375)
Year ended 11/30/1993 .................. 1.00 0.0294 (0.0294) (0.0294)
PRIMARY B SHARES
Six months ended 09/30/1998 +++ ........ $ 1.00 $ 0.0247 $ (0.0247) $ (0.0247)
Year ended 03/31/1998 .................. 1.00 0.0499 (0.0499) (0.0499)
Year ended 03/31/1997 .................. 1.00 0.0478 (0.0478) (0.0478)
Period ended 03/31/1996 (a) ............ 1.00 0.0165 (0.0165) (0.0165)
Year ended 11/30/1995 .................. 1.00 0.0533 (0.0533) (0.0533)
Period ended 11/30/1994 * .............. 1.00 0.0200 (0.0200)# (0.0200)
INVESTOR A SHARES
Six months ended 09/30/1998 +++ ........ $ 1.00 $ 0.0242 $ (0.0242) $ (0.0242)
Year ended 03/31/1998 .................. 1.00 0.0489 (0.0489) (0.0489)
Year ended 03/31/1997 .................. 1.00 0.0468 (0.0468) (0.0468)
Period ended 03/31/1996 (a) ............ 1.00 0.0162 (0.0162) (0.0162)
Year ended 11/30/1995 .................. 1.00 0.0522 (0.0522) (0.0522)
Year ended 11/30/1994 .................. 1.00 0.0340 (0.0340)# (0.0340)
Year ended 11/30/1993 .................. 1.00 0.0256 (0.0256) (0.0256)
INVESTOR B SHARES
Six months ended 09/30/1998 +++ ........ $ 1.00 $ 0.0247 $ (0.0247) $ (0.0247)
Year ended 03/31/1998 .................. 1.00 0.0499 (0.0499) (0.0499)
Year ended 03/31/1997 .................. 1.00 0.0478 (0.0478) (0.0478)
Period ended 03/31/1996 (a) ............ 1.00 0.0165 (0.0165) (0.0165)
Year ended 11/30/1995 .................. 1.00 0.0532 (0.0532) (0.0532)
Period ended 11/30/1994 * .............. 1.00 0.0222 (0.0222)# (0.0222)
INVESTOR C SHARES
Six months ended 09/30/1998 +++ ........ $ 1.00 $ 0.0247 $ (0.0247) $ (0.0247)
Year ended 03/31/1998 .................. 1.00 0.0499 (0.0499) (0.0499)
Year ended 03/31/1997 .................. 1.00 0.0478 (0.0478) (0.0478)
Period ended 03/31/1996 (a) ............ 1.00 0.0165 (0.0165) (0.0165)
Year ended 11/30/1995 .................. 1.00 0.0532 (0.0532) (0.0532)
Period ended 11/30/1994 * .............. 1.00 0.0290 (0.0290)# (0.0290)
DAILY SHARES
Six months ended 09/30/1998 +++ ........ $ 1.00 $ 0.0234 $ (0.0234) $ (0.0234)
Year ended 03/31/1998 .................. 1.00 0.0474 (0.0474) (0.0474)
Year ended 03/31/1997 .................. 1.00 0.0453 (0.0453) (0.0453)
Period ended 03/31/1996 (a) ............ 1.00 0.0157 (0.0157) (0.0157)
Period ended 11/30/1995 * .............. 1.00 0.0418 (0.0418) (0.0418)
* Government Money Market Primary A, Primary B, Investor A, Investor B, Investor C and Daily Shares
commenced operations on December 3, 1990, June 16, 1994, February 11, 1991, May 17, 1994, March 21,
1994 and February 10, 1995, respectively.
+ Annualized.
++ Total return represents aggregate total return for the period indicated and does not reflect the
deduction on any applicable sales charges.
+++ Unaudited.
# Amount includes distributions from net realized gains of less than $0.0001 per share.
(a) Fiscal year end changed to March 31. Prior to this, the fiscal year end was November 30.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
NATIONS FUNDS
<TABLE>
- -------------------------------------------------------------------------------------------------
Financial Highlights (continued)
- -------------------------------------------------------------------------------------------------
<CAPTION>
RATIO TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
---------------------------------------------
OPERATING
EXPENSES
NET ASSET NET ASSETS WITHOUT
VALUE END OF WAIVERS
END OF TOTAL YEAR OPERATING NET INVESTMENT AND/OR
YEAR RETURN++ (000) EXPENSES INCOME REIMBURSEMENTS
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
$ 1.00 2.61% $ 202,103 0.30%+ 5.18%+ 0.53%+
1.00 5.39 217,506 0.30 5.25 0.59
1.00 5.18 299,395 0.30 5.03 0.57
1.00 1.74 336,771 0.30+ 5.20+ 0.59+
1.00 5.72 332,895 0.30 5.58 0.57
1.00 3.84 432,729 0.30 3.79 0.59
1.00 2.96 475,180 0.30 2.91 0.56
$ 1.00 2.49% $ 1,699 0.55%+ 4.93%+ 0.78%+
1.00 5.12 1,812 0.55 5.00 0.84
1.00 4.93 19,450 0.55 4.78 0.82
1.00 1.66 31,581 0.55+ 4.95+ 0.84+
1.00 5.45 27,122 0.55 5.33 0.82
1.00 2.02 72,747 0.55+ 3.54+ 0.84+
$ 1.00 2.44% $ 27,307 0.65%+ 4.83%+ 0.88%+
1.00 5.01 23,806 0.65 4.90 0.94
1.00 4.80 18,717 0.65 4.68 0.92
1.00 1.62 48,742 0.65+ 4.85+ 0.94+
1.00 5.34 26,175 0.65 5.23 0.92
1.00 3.45 20,173 0.65 3.44 0.94
1.00 2.60 10,499 0.61 2.60 0.87
$ 1.00 2.49% $ 79,484 0.55%+ 4.93%+ 0.88%+
1.00 5.12 77,060 0.55 5.00 0.84
1.00 4.93 27,750 0.55 4.78 0.82
1.00 1.66 62,617 0.55+ 4.95+ 0.84+
1.00 5.45 27,079 0.55 5.33 0.82
1.00 2.24 11,955 0.55+ 3.54+ 0.84+
$ 1.00 2.49% $ 1,813 0.55%+ 4.93%+ 0.78%+
1.00 5.12 3,369 0.55 5.00 0.84
1.00 4.93 2,142 0.55 4.78 0.82
1.00 1.66 1,731 0.55+ 4.95+ 0.84+
1.00 5.44 4,414 0.55 5.33 0.82
1.00 2.94 476 0.55+ 3.54+ 0.84+
$ 1.00 2.36% $ 4,124 0.80%+ 4.68%+ 1.23%+
1.00 4.85 6,567 0.80 4.75 1.09
1.00 4.63 7,860 0.80 4.53 1.07
1.00 1.58 2 0.71+ 4.79+ 1.00+
1.00 4.38 2 0.55+ 5.33+ 0.82+
</TABLE>
<PAGE>
NATIONS FUNDS
<TABLE>
- ----------------------------------------------------------------------------------------------------------
Financial Highlights
- ----------------------------------------------------------------------------------------------------------
For a Share outstanding throughout each period.
<CAPTION>
NET ASSET DIVIDENDS TOTAL
VALUE NET FROM NET DIVIDENDS
BEGINNING INVESTMENT INVESTMENT AND
OF YEAR INCOME INCOME DISTRIBUTIONS
------------------------------------------------------------
<S> <C> <C> <C> <C>
PRIME:
PRIMARY A SHARES
Six months ended 09/30/1998+++ ......... $ 1.00 $ 0.0272 $ (0.0272) $ (0.0272)
Year ended 03/31/1998 .................. 1.00 0.0547 (0.0547) (0.0547)
Year ended 03/31/1997 .................. 1.00 0.0520 (0.0520) (0.0520)
Period ended 03/31/1996 (a) ............ 1.00 0.0468 (0.0468) (0.0468)
Year ended 05/31/1995 .................. 1.00 0.0519 (0.0519) (0.0519)
Year ended 05/31/1994 .................. 1.00 0.0318 (0.0318) (0.0318)
Year ended 05/31/1993 .................. 1.00 0.0328 (0.0328) (0.0328)
PRIMARY B SHARES
Six months ended 09/30/1998+++ ......... $ 1.00 $ 0.0259 $ (0.0259) $ (0.0259)
Year ended 03/31/1998 .................. 1.00 0.0522 (0.0522) (0.0522)
Year ended 03/31/1997 .................. 1.00 0.0495 (0.0495) (0.0495)
Period ended 03/31/1996 (a) ............ 1.00 0.0447 (0.0447) (0.0447)
Period ended 05/31/1995 * .............. 1.00 0.0474 (0.0474) (0.0474)
INVESTOR A SHARES
Six months ended 09/30/1998+++ ......... $ 1.00 $ 0.0254 $ (0.0254) $ (0.0254)
Year ended 03/31/1998 .................. 1.00 0.0512 (0.0512) (0.0512)
Year ended 03/31/1997 .................. 1.00 0.0485 (0.0485) (0.0485)
Period ended 03/31/1996 (a) ............ 1.00 0.0438 (0.0438) (0.0438)
Year ended 05/31/1995 .................. 1.00 0.0475 (0.0475) (0.0475)
Year ended 05/31/1994 .................. 1.00 0.0283 (0.0283) (0.0283)
Year ended 05/31/1993 .................. 1.00 0.0293 (0.0293) (0.0293)
INVESTOR B SHARES
Six months ended 09/30/1998+++ ......... $ 1.00 $ 0.0259 $ (0.0259) $ (0.0259)
Year ended 03/31/1998 .................. 1.00 0.0522 (0.0522) (0.0522)
Year ended 03/31/1997 .................. 1.00 0.0495 (0.0495) (0.0495)
Period ended 03/31/1996 (a) ............ 1.00 0.0447 (0.0447) (0.0447)
Year ended 05/31/1995 .................. 1.00 0.0493 (0.0493) (0.0493)
Period ended 05/31/1994 * .............. 1.00 0.0015 (0.0015) (0.0015)
INVESTOR C SHARES
Six months ended 09/30/1998+++ ......... $ 1.00 $ 0.0259 $ (0.0259) $ (0.0259)
Year ended 03/31/1998 .................. 1.00 0.0522 (0.0522) (0.0522)
Year ended 03/31/1997 .................. 1.00 0.0495 (0.0495) (0.0495)
Period ended 03/31/1996 (a) ............ 1.00 0.0447 (0.0447) (0.0447)
Year ended 05/31/1995 .................. 1.00 0.0493 (0.0493) (0.0493)
Period ended 05/31/1994 * .............. 1.00 0.0155 (0.0155) (0.0155)
DAILY SHARES
Six months ended 09/30/1998+++ ......... $ 1.00 $ 0.0247 $ (0.0247) $ (0.0247)
Year ended 03/31/1998 .................. 1.00 0.0497 (0.0497) (0.0497)
Year ended 03/31/1997 .................. 1.00 0.0470 (0.0470) (0.0470)
Period ended 03/31/1996 (a) ............ 1.00 0.0439 (0.0439) (0.0439)
Period ended 05/31/1995 * .............. 1.00 0.0173 (0.0173) (0.0173)
- ----------
* Prime primary B, Investor A, Investor B, Investor C and Daily Shares commenced operations on June 16,
1994, July 16, 1990, May 11, 1994, November 26, 1993, and February 9, 1995, respectively.
+ Annualized.
++ Total return represents aggregate total return for the period indicated and does not reflect the
deduction on any applicable sales charges.
+++ Unaudited.
(a) Fiscal year end changed to March 31. Prior to this, the fiscal year end was May 31.
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
NATIONS FUNDS
<TABLE>
- -------------------------------------------------------------------------------------------------
Financial Highlights (continued)
- -------------------------------------------------------------------------------------------------
<CAPTION>
RATIO TO AVERAGE NET ASSETS/SUPPLEMENTAL DATA
---------------------------------------------
OPERATING
EXPENSES
NET ASSET NET ASSETS WITHOUT
VALUE END OF WAIVERS
END OF TOTAL YEAR OPERATING NET INVESTMENT AND/OR
YEAR RETURN++ (000) EXPENSES INCOME REIMBURSEMENTS
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
$ 1.00 2.75% $ 2,621,743 0.30%+ 5.42%+ 0.33%+
1.00 5.61 2,852,555 0.30 5.48 0.35
1.00 5.34 2,533,688 0.30 5.21 0.35
1.00 4.79 2,472,469 0.30+ 5.62+ 0.37+
1.00 5.32 2,873,096 0.30 5.23 0.38
1.00 3.22 2,883,762 0.30 3.20 0.37
1.00 3.33 1,156,266 0.30 3.25 0.36
$ 1.00 2.63% $ 28,278 0.55%+ 5.17%+ 0.58%+
1.00 5.34 8,132 0.55 5.23 0.60
1.00 5.05 184,021 0.55 4.96 0.60
1.00 4.57 96,305 0.55+ 5.37+ 0.62+
1.00 4.84 126,120 0.55+ 4.98+ 0.63+
$ 1.00 2.57% $ 2,989,488 0.65%+ 5.07%+ 0.68%+
1.00 5.24 1,706,692 0.65 5.13 0.70
1.00 4.96 1,157,724 0.65 4.86 0.70
1.00 4.48 1,099,490 0.65+ 5.27+ 0.72+
1.00 4.85 698,358 0.75 4.78 0.83
1.00 2.86 511,833 0.65 2.85 0.72
1.00 2.97 306,376 0.65 2.90 0.71
$ 1.00 2.63% $ 634,855 0.55%+ 5.17%+ 0.68%+
1.00 5.34 844,367 0.55 5.23 0.60
1.00 5.05 381,015 0.55 4.96 0.60
1.00 4.57 358,646 0.55+ 5.37+ 0.62+
1.00 5.03 216,973 0.56 4.97 0.64
1.00 0.15 2 0.55+ 2.95+ 0.62+
$ 1.00 2.63% $ 64,660 0.55%+ 5.17%+ 0.58%+
1.00 5.34 96,149 0.55 5.23 0.60
1.00 5.05 93,678 0.55 4.96 0.60
1.00 4.57 74,822 0.55+ 5.37+ 0.62+
1.00 5.03 53,451 0.56 4.97 0.64
1.00 1.58 1,481 0.55+ 2.95+ 0.62+
$ 1.00 2.51% $ 765,618 0.80%+ 4.92%+ 1.03%+
1.00 5.08 92,974 0.80 4.98 0.85
1.00 4.80 9,010 0.80 4.71 0.85
1.00 4.49 40 0.67+ 5.25+ 0.74+
1.00 1.74 2 0.55+ 4.98+ 0.63+
</TABLE>
<PAGE>
NATIONS FUNDS
Notes to Financial Statements (unaudited)
Nations Fund Trust (the "Trust") and Nations Fund, Inc. (the "Company") are each
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 and the Company offered nine separate
portfolios. These financial statements pertain only to the money market
portfolios of the Trust and the Company (each a "Fund" and collectively, the
"Funds"). Financial statements for the other portfolios of the Trust and the
Company are presented under separate cover. The Funds currently offer six
classes of shares: Primary A Shares, Primary B Shares, Investor A Shares,
Investor B Shares, Investor C Shares and Daily Shares. 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 which the
interests of one class of shares differ from the interest 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 on the basis of amortized cost,
which approximates market value. Amortized cost valuation involves initially
valuing an instrument at its cost and thereafter assuming a constant
amortization to maturity of any discount or premium, as long as the effect of
fluctuating interest rates on the market value of the instrument is not
significant. Restricted securities and certain other assets are valued by the
investment advisor under the supervision of the Board of Trustees/Directors.
Repurchase Agreements: Each Fund may engage in repurchase agreement
transactions. Under the terms of a typical repurchase agreement, the Fund takes
possession of an underlying debt obligation subject to an obligation of the
seller to repurchase, and the Fund to resell, the obligation at an agreed-upon
price and date, thereby determining the yield during the Fund's holding period.
This arrangement results in a fixed rate of return that is not subject to market
fluctuations during the Fund's holding period. The value of the collateral is at
least equal at all times to the total amount of the repurchase obligations,
including interest. Generally, in the event of counterparty default, the Fund
has the right to use the collateral to offset losses incurred. There would be a
potential loss to the Fund in the event the Fund is delayed or prevented from
exercising its right to dispose of the collateral securities, including the risk
of a possible decline in the value of the underlying securities during the
period while the Fund seeks to assert its right. The Funds' investment advisor
and sub-advisor, acting under the supervision of the Board of
Trustees/Directors, monitor the value of collateral received as well as the
creditworthiness of those banks and dealers with which the Funds enter into
repurchase agreements to evaluate potential risks.
Reverse Repurchase Agreements: Each Fund may enter into reverse repurchase
agreements with institutions that the Funds' investment advisor and sub-advisor
has determined are creditworthy. Under the terms of a typical reverse repurchase
agreement, the Fund sells securities and agrees to repurchase them at a mutually
agreed upon date and price. At the time the Fund enters into a reverse
repurchase agreement, it establishes a segregated account with its custodian
bank in which it will maintain cash, U.S. Government securities or other
appropriate liquid securities at least equal in value to the Funds' obligations
arising under the reverse repurchase agreement. Reverse repurchase agreements
involve the risk that the market value of the securities purchased with the
proceeds from the sale of securities received by the Fund may decline below the
price of the securities that the Fund is obligated to repurchase. Securities
subject to repurchase under reverse repurchase agreements are designated in the
Statement of Net Assets.
At September 30, 1998, the Treasury Fund had reverse repurchase agreements
outstanding as follows:
Maturity Amount .................................. $495,588,000
Maturity Date .................................... 10/01/98
Market Value of Assets Sold Under Agreements ..... $485,000,000
The average daily balance of reverse repurchase agreements outstanding by the
Treasury Fund during the six months ended September 30, 1998 was $420,931,000.
The proceeds received by the Treasury Fund under the reverse repurchase
agreements were reinvested in a tri-party repurchase agreement. Net fees earned
during the six months ended September 30, 1998, representing the difference
between interest rates on the reverse repurchase and repurchase agreements,
amounted to $397,000 and have been included in interest income in the Statement
of Operations.
Securities Transactions and Investment Income: Securities transactions are
accounted for on trade date. Realized gains and losses are computed based on the
specific identification of securities sold. Interest income, adjusted for
accretion of discounts and amortization of premiums calculated ratably, is
earned from the 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 the trade date.
Dividends and Distributions to Shareholders: It is the policy of each Fund to
declare dividends daily from net investment income and to pay such dividends
monthly. Each Fund will distribute net realized short-term capital gains
annually after the fiscal year in which the capital gains were earned or more
frequently to maintain a net asset value of $1.00 per share, 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 or Company 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.
Cash Flow Information: Cash, as used in the Statement of Cash Flows, is the
amount reported in the Statements of Assets and Liabilities and represents cash
on hand at custodian banks. The Trust and the Company issue and redeem shares,
invest in securities, and distribute dividends from net investment income and
net capital gains (which are either paid in cash or reinvested at the discretion
of shareholders). These activities are reported in the Statements of Changes in
Net Assets. Information on cash payments is presented in the Statement of Cash
Flows.
2. INVESTMENT ADVISORY FEE, SUB-ADVISORY FEE, ADMINISTRATION FEE AND RELATED
PARTY TRANSACTIONS
Each of the Trust and the Company has entered into an investment advisory
agreement (the "Investment Advisory Agreements") with NationsBanc Advisors, Inc.
("NBAI"), a wholly-owned subsidiary of NationsBank, N.A., ("NationsBank"),
pursuant to which NBAI provides investment advisory services to the Funds. Under
the Investment Advisory Agreements, NBAI is entitled to receive a fee calculated
daily and paid monthly based on the average daily net assets as follows: (i)
Government Money Market and Tax Exempt at the annual rate of 0.40% and (ii)
Prime and Treasury at the annual rate of 0.25% on combined net assets up to $250
million and 0.20% on combined net assets exceeding $250 million.
Each of the Trust and the Company 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 0.055% of each Fund's average
daily net assets.
Stephens, Inc. ("Stephens") serves as the administrator of the Trust and the
Company. 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 the average daily net assets of the
Funds. NBAI is the sub-administrator of the Company and Nations Portfolios. For
the six months ended September 30, 1998, Stephens earned $4,721,000, net of fee
waivers, from the Funds for its administration services, of which $640,000 was
paid to NBAI for its services as sub-administrator.
The investment advisor, sub-advisor and administrator may, from time to time,
reduce their fees payable by each Fund.
For the six months ended September 30, 1998, fees waived were as follows:
Fees waived Fees waived
by Advisor by Administrator
--------------------------------------
Tax Exempt .............. $ 2,889,000 $265,000
Treasury ................ 278,000 297,000
Government Money Market.. 405,000 34,000
Prime ................... 466,000 684,000
NationsBank of Texas, N.A. ("NationsBank of Texas") served as the custodian of
the Trust's and the Company's assets until it merged with NationsBank on May 6,
1998. NationsBank began serving as custodian for the Trust's and the Company'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 $2,000 and $10,000, 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. For the six months ended September 30, 1998,
expenses of the Funds were reduced by $9,000 under expense offset arrangements
with BNY. The Funds could have invested a portion of the assets utilized in
connection with the expense offset arrangements in an income producing asset if
they had not entered into such arrangements.
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 Shares of the
Funds until it merged with NationsBank on May 6, 1998. NationsBank began serving
as the sub-transfer agent for the Primary 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 $2,000 and $8,000, respectively, for providing
such services. Stephens also serves as distributor of the Funds' shares.
The Trust and the Company pay each unaffiliated Trustee or Director an annual
fee of $1,000 ($3,000 for the Chairman of the Board), plus $500 per Fund and an
additional $1,000 for each in-person board meeting and $500 for each telephonic
board meeting attended. The Trust and the Company also reimburse expenses
incurred by each unaffiliated Trustee or Director in attending such meetings.
The Trust's and the Company's eligible Trustees or Directors, respectively, may
participate in 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 the Treasury Fund. The expense
for the deferred compensation and retirement plans is included in
"Trustees'/Directors' fees and expenses" in the Statements of Operations.
A significant portion of each Fund's Primary A Shares represents investments by
fiduciary accounts over which NationsBank has either sole or joint investment
discretion.
On September 30, 1998, NationsBank Corporation, the parent company of
NationsBank, merged with BankAmerica Corporation.
3. SHAREHOLDER SERVICING AND DISTRIBUTION PLANS
The Trust and the Company each have adopted shareholder servicing plans and
distribution plans for the Primary B, Investor B, Investor C and Daily 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 distributions plans, adopted pursuant to Rule 12b-1 under the 1940
Act, permit the Fund 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 classes' shares.
Payments are made at an annual rate, as a percentage of average daily net assets
set from time to time by the Board of Trustees/Directors, and are charged as
expenses of each Fund directly to the applicable class. A substantial portion of
the expenses pursuant to these plans is paid to affiliates of NationsBank and
NBAI.
At September 30, 1998, the actual rates in effect and plan limits, as a
percentage of average daily net assets, were as follows:
Plan
Current Rate Limit
---------------------
Primary B, Investor A, Investor C and
Daily Shareholder Servicing Plans . 0.25% 0.25%
Investor B Shareholder Servicing Plan
Prime, Treasury, Government
Money Market ...................... 0.25% 0.25%
Tax Exempt ........................ 0.20% 0.25%
Investor A Distribution Plan ........ 0.10% 0.10%
Investor B Distribution Plan ........ 0.00% 0.10%
Daily Distribution Plan ............. 0.25% 0.45%
4. SHARES OF BENEFICIAL INTEREST/COMMON STOCK
At September 30, 1998, an unlimited number of shares of beneficial interest
without par value were authorized for the Trust and 420,000,000,000 shares of
$.001 par value capital stock were authorized for the Company. The Trust's
Declaration of Trust and the Company's Articles of Incorporation authorize the
Board of Trustees/Directors to classify or reclassify any authorized, but
unissued shares into one or more additional classes or series of shares. See
Schedule of Capital Stock Activity.
5. RESTRICTED SECURITIES
The following securities are illiquid and restricted as to resale. Accordingly,
they are valued at fair value in good faith by the advisor under the direction
of the Board of Trustees/Directors, as applicable, taking into consideration
such factors as the relevant Board deems appropriate.
Certain securities may be sold only pursuant to certain legal restrictions and
may be difficult to sell. No Fund will invest more than 10% of the value of its
net assets in securities that are illiquid.
<TABLE>
<CAPTION>
PRIME
FAIR PERCENTAGE HISTORICAL
PAR VALUE VALUE VALUE OF COST
ACQUISITION 9/30/98 PER UNIT 9/30/98 NET ASSETS 9/30/98
SECURITY DATE (000) 9/30/98 (000) 9/30/98 (000)
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Allstate Life Insurance Company:
5.816% 11/01/98# .............................. 11/01/97 $25,000 $1.00 $ 25,000 0.4% $ 25,000
5.816% 12/01/98# .............................. 12/01/97 25,000 1.00 25,000 0.4 25,000
Anchor National Life Insurance Company:
5.740% 12/29/98# .............................. 05/16/97 50,000 1.00 50,000 0.7 50,000
5.759% 12/29/98# .............................. 12/01/97 25,000 1.00 25,000 0.4 25,000
Commonwealth Life Insurance Company:
5.730% 10/01/98 +++ ........................... 02/05/98 50,000 1.00 50,000 0.7 50,000
5.880% 03/29/99# .............................. 12/01/97 62,000 1.00 62,000 0.8 62,000
5.880% 03/29/99# .............................. 02/02/98 10,000 1.00 10,000 0.1 10,000
First Allmerica Life Insurance Company:
5.760% 12/29/98# .............................. 11/24/97 50,000 1.00 50,000 0.7 50,000
Life Insurance Company of Georgia,:
5.799% 03/29/99# .............................. 01/01/98 60,000 1.00 60,000 0.8 60,000
Peoples Security Life Insurance Company:
5.830% 10/01/98 +++ ........................... 12/04/97 20,000 1.00 20,000 0.3 20,000
5.880% 12/29/98# .............................. 01/05/98 20,000 1.00 20,000 0.3 20,000
Sun Life Insurance Company of America:
5.789% 03/29/99# .............................. 10/01/97 50,000 1.00 50,000 0.7 50,000
Travelers Life Insurance Company:
5.695% 10/01/98 +++ ........................... 02/03/98 25,000 1.00 25,000 0.4 25,000
5.645% 10/31/98 +++ ........................... 08/31/98 25,000 1.00 25,000 0.4 25,000
- --------------------------------------------------------------------------------------------------------------------------------
$497,000,000 7.0% $497,000,000
- --------------------------------------------------------------------------------------------------------------------------------
# Put date
+++ Reset Date
</TABLE>
The following securities of the Prime Fund are restricted as to resale, however,
they are considered liquid due to the put feature which allows the Fund to put
the security back to the issuer at par level within seven calendar days.
<TABLE>
<CAPTION>
FAIR PERCENTAGE HISTORICAL
PAR VALUE VALUE VALUE OF COST
ACQUISITION 9/30/98 PER UNIT 9/30/98 NET ASSETS 9/30/98
SECURITY DATE (000) 9/30/98 (000) 9/30/98 (000)
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
General American Life Insurance Company
5.850% 10/07/98# .............................. 02/06/98 $50,000 $1.00 $50,000 0.7% $ 50,000
5.850% 10/07/98# .............................. 05/16/98 50,000 1.00 50,000 0.7 50,000
Life Insurance Company of Virginia
5.618% 10/07/98# .............................. 09/01/98 50,000 1.00 50,000 0.7 50,000
5.618% 10/07/98# .............................. 02/01/97 25,000 1.00 25,000 0.4 25,000
5.618% 10/07/98# .............................. 03/01/98 25,000 1.00 25,000 0.4 25,000
New York Life Insurance Company
5.679% 10/07/98# .............................. 11/17/97 50,000 1.00 50,000 0.7 50,000
- ---------------------------------------------------------------------------------------------------------------------------------
$250,000,000 3.5% $250,000,000
- ---------------------------------------------------------------------------------------------------------------------------------
# Put date
</TABLE>
6. LINE OF CREDIT
The Trust and Company participate in an uncommitted line of credit provided by
BNY under an agreement (the "Agreement") dated July 10, 1998. Advances under the
Agreement are taken primarily for temporary or emergency purposes, including the
meeting of 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 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 aggregate amount of indebtedness pursuant to the Agreement.
For the six months ended September 30, 1998, borrowing by the Funds was as
follows:
AVERAGE AVERAGE AVERAGE
AMOUNT AVERAGE DEBT INTEREST
FUND OUTSTANDING SHARES PER SHARE RATE
- -------------------------------------------------------------------------------
Tax Exempt ........... $ 111,000 371,485,159 $ 0.00(a) 6.09%
- -------------------------------------------------------------------------------
(a) Amount represents less than $0.01 per share
The average amount outstanding was calculated based on daily balances in the
period.
7. CAPITAL LOSS CARRYFORWARD
At September 30, 1998, the Funds had available for Federal income tax purposes
the following unused capital losses expiring March 31:
<TABLE>
<CAPTION>
1999 2001 2002 2003 2004 2005 2006
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Prime ................. $203,000 -- -- $131,000 $ 35,000 $407,000 $ 23,000
Government Money Market -- -- -- 66,000 2,000 -- --
Treasury .............. -- -- $ 16,000 26,000 95,000 31,000 14,000
Tax exempt ............ -- $ 23,000 16,000 44,000 -- 1,000 2,000
</TABLE>
8. REORGANIZATIONS
On May 16, 1997, certain Funds, as listed below (each an "Acquiring Fund"),
acquired the assets and liabilities of The Pilot Funds, also listed below (each
an "Acquired Fund"), in a tax-free reorganization in exchange for shares of the
Acquiring Fund, pursuant to agreements and plans of reorganization approved by
the Acquired Fund's shareholders. The value of shares issued by the Acquiring
Fund is presented in the Schedule of Capital Stock Activity. Net assets as of
the reorganization date were as follows:
<TABLE>
<CAPTION>
TOTAL NET ASSETS OF
ACQUIRING ACQUIRED TOTAL NET ASSETS OF TOTAL NET ASSETS OF ACQUIRING FUND
FUND FUND ACQUIRED FUND ACQUIRING FUND AFTER ACQUISITION
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Prime Fund Pilot Shor-Term
Diversified Assets Fund $1,854,583,000 $4,275,977,000 $6,130,560,000
Treasury Pilot Short-Term
U.S. Treasury Fund 1,619,654,000 2,618,142,000 4,237,796,000
Tax Exempt Pilot Short-Term
Tax Exempt Diversified Fund 391,958,000 1,461,773,000 1,853,731,000
Tax Exempt Pilot Missouri Short-Term
Tax Exempt Fund 226,780,000 1,853,731,000 2,080,511,000
</TABLE>
On May 15, 1998, certain Funds, as listed below (each an "Acquiring Fund"),
acquired the assets and liabilities of The Emerald Funds, also listed below
(each an "Acquired Fund"), in a tax-free reorganization in exchange for shares
of the Acquiring Fund, pursuant to agreements and plans of reorganization
approved by the Acquired Fund's shareholders. The value of shares issued by the
Acquiring Fund is presented in the Schedule of Capital Stock Activity. Net
assets as of the reorganization date were as follows:
<TABLE>
<CAPTION>
TOTAL NET ASSETS OF
ACQUIRING ACQUIRED TOTAL NET ASSETS OF TOTAL NET ASSETS OF ACQUIRING FUND
FUND FUND ACQUIRED FUND ACQUIRING FUND AFTER ACQUISITION
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Tax Exempt Emerald Tax Exempt $ 170,700,000 $2,426,697,000 $2,597,397,000
Prime Emerald Prime Money Market 2,174,402,000 5,517,462,000 7,691,864,000
Treasury Emerald Treasury Money Market 875,235,000 2,468,064,000 3,343,299,000
</TABLE>
On June 19, 1998, Tax-Exempt Fund, as listed below (an "Acquiring Fund"),
acquired the assets of the common trust fund managed by NationsBank listed below
(an "Acquired Fund") in a tax-free exchange for shares of the Acquiring Fund.
The number and value of shares issued by the Acquiring Fund is presented in the
Schedule of Capital Stock Activity. Net assets as of the conversion date were as
follows:
<TABLE>
<CAPTION>
TOTAL NET ASSETS OF
ACQUIRING ACQUIRED TOTAL NET ASSETS OF TOTAL NET ASSETS OF ACQUIRING FUND
FUND FUND ACQUIRED FUND ACQUIRING FUND AFTER ACQUISITION
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Tax Exempt Common Trust Municipal Temp $ 52,112,000 $2,597,973,000 $2,650,085,000
</TABLE>
9. SUBSEQUENT EVENTS
Effective October 19, 1998, Bank of New York began serving as the custodian for
the Trust's and the Company's assets and is providing the same services as were
previously provided by NationsBank. There no longer is a sub-custodian for the
Trust or the Company.
On November 5, 1998 ,the Boards of Directors/Trustees of each of the Trust and
the Company approved changes in the Funds' administration arrangements whereby
NBAI and Stephens will each serve as co-administrators for the Funds, and BNY
will serve as sub-administrator. These changes, which will become effective for
the Funds in the fourth quarter of 1998, will reflect an increase in the overall
administration fees paid by the Funds.
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--------------
NATIONS BULK RATE
FUNDS U.S. POSTAGE
PAID
P.O. Box 32602 N READING, MA
Charlotte, NC 28234-4602 PERMIT NO.
Toll Free 1-800-982-2271 105
--------------
SAR4 97495 9/9