CRESTFUNDS, INC.
ANNUAL
REPORT
NOVEMBER 30, 1996
CASH RESERVE FUND
U.S. TREASURY MONEY FUND
TAX FREE MONEY FUND
LIMITED TERM BOND FUND
INTERMEDIATE BOND FUND
GOVERNMENT BOND FUND
VIRGINIA INTERMEDIATE MUNICIPAL
BOND FUND
VIRGINIA MUNICIPAL BOND FUND
MARYLAND MUNICIPAL BOND FUND
VALUE FUND
CAPITAL APPRECIATION FUND
SPECIAL EQUITY FUND
<PAGE>
DEAR CRESTFUNDS SHAREHOLDER:
Financial assets performed well for the fiscal year ended November 30, 1996.
Equities, once again, were the asset of choice for the period with investment
returns only slightly below the strong showing of a year ago. Fixed income and
money market returns were more in line with historical norms but still provided
investment returns well above the increase in inflation.
In last year's annual report, we stated that there was a high probability
that the economic expansion would continue, but that the financial markets were
likely to generate more moderate investment returns than we saw during fiscal
year 1995. As we begin fiscal year 1997, we, again, look for a continuation of
the economic expansion and positive investment returns across all asset classes.
However, we approach the new year with more caution than a year ago simply
because the economy and the financial markets are extended and are more
vulnerable to negative shocks from a growing list of sources.
A REVIEW OF 1996:
THE ECONOMY AND THE FINANCIAL MARKETS
The economy surged briefly early in the year. Employment jumped, retail spending
accelerated, and the interest rate sensitive housing market showed renewed
vigor. This increase in economic activity created concerns that inflation would
rise, possibly forcing the Federal Reserve to raise interest rates. The market
reaction was swift and relatively severe as 90-day Treasury Bill rates rose from
4.91% to 5.35% by the summer. Long-term Treasury bond yields jumped from a low
of 5.95% to 7.19% during the same period. The jump in rates curbed enthusiasm
for equities. The S&P 500 Index showed little change from February to the middle
of September. Much of this stress in the financial markets was in anticipation
of an upward rate change by the Federal Reserve. That change never came.
The economic surge was indeed brief. Economic growth fell to a below-average
pace during the second half of the year. Job growth slowed, consumer spending
stalled, loan delinquencies rose, and the housing and auto markets retreated.
The drop in growth relieved fears of an over-expanded economy, giving new life
to financial assets. Treasury Bills fell to previous lows, and bond yields
dipped below the 6.40% level.
The more favorable interest rate and inflation environment, combined with
continued growth in corporate profits, energized stocks. The S&P 500 Index
jumped over 20% from the middle of July to the end of November. For the fiscal
year ended November 30, 1996, the total return from 90 day Treasury Bills was
5.10%, while the Lehman Government/Corporate Intermediate Index recorded a 5.83%
return. The S&P 500 Index had a total return of 27.88% for the fiscal year,
while the NASDAQ composite produced a 22.04% return.
<PAGE>
THE ECONOMIC OUTLOOK FOR 1997
The current expansion is poised to enter its seventh year, making it one of the
longest on record. While we see few imbalances that might put an end to this
impressive streak, we likewise see few areas in the economy able to produce
anything better than average growth. Consumer spending has slowed, and the
willingness to use credit is fading. Moreover, the desire of banks to extend new
credit has taken a more conservative tone. Lower mortgage rates could help keep
a floor under the housing market, but any new round of building is likely to be
muted at best. Typically, there is very little "pent up" demand this long into
an economic expansion. This does not suggest bad news, but rather, an economic
scenario that leaves little room for error.
If spending is no better than average in the coming year, corporate expansion
plans would need to be curtailed, and corporate profit growth could struggle to
keep pace with the success of previous years. In this environment of modest
growth, inflation pressures should be muted. Overall, economic growth should
average around 2% for the year, with inflation, as measured by the Consumer
Price Index, rising 2-3%. While economic expansions do not "die of old age",
they do become increasingly vulnerable to negative shocks such as an unexpected
commodity price change, a labor disruption, or a sudden drop in consumer
confidence, or a political or economic problem overseas. These underlying
concerns significantly reduce the chance of a robust economy.
THE OUTLOOK FOR THE FINANCIAL MARKETS
Our long-term outlook for financial assets remains very positive. For the coming
year we are cautiously optimistic. We could see quarterly jumps in economic
growth or in some consumer prices, but the general trend to more moderate growth
in inflation is still intact. This could provide room for moderate declines in
both short- and long- term interest rates. In this environment, we would look
for bond funds to perform reasonably well, while money market fund yields could
be lower.
The key to equity performance in 1997 will be corporate profitability.
Competition from foreign markets is not likely to fade. Healthy competition and
modest consumer demand is likely to keep pressure on corporations to protect
market share and strengthen their cost management disciplines. We do not see
these pressures receding in the near future. Consequently, corporate America
will be faced with the challenge of meeting and/or exceeding anticipated
earnings per share. Investors are unlikely to accept earnings disappointments.
Equity prices have generated a total return over the past two years in excess of
70%. Historically, such a strong performance has been followed by a period of
weakness. As a result, we are more cautious on our outlook for equities than we
were a year ago.
On behalf of all of us who manage CrestFunds, let me thank you for the
opportunity to serve you. Please let us know if there is more we can do to help
you fulfill your investment objectives.
Sincerely,
[Signature Omitted]
BEN L. JONES
PRESIDENT
Capitoline Investment Services Incorporated
A wholly-owned subsidiary of Crestar Bank
<PAGE>
CRESTFUNDS, INC.: LIMITED TERM BOND FUND
- --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE
The Limited Term Bond Fund seeks to provide a high level of current income by
investing in investment-grade fixed income debt obligations. The Fund is managed
to maintain a dollar-weighted average portfolio maturity of between 1 and 5
years.
YEAR IN REVIEW
FISCAL YEAR ENDING NOVEMBER 1996 WAS CHALLENGING FOR BOND MARKET PARTICIPANTS.
After experiencing weakness throughout much of 1995, the US economy received a
much needed boost from the Federal Reserve when it lowered the Federal Funds
rate in December 1995 and again in January 1996 to its present level of 5.25%.
By the end of the first quarter of 1996, it was apparent that these lower
interest rates had provided consumers and businesses with the incentive to
increase spending. As the economy continued to strengthen during the second
quarter, each monthly employment report showed a rising number of newly created
jobs and a falling number of unemployed Americans. Against this backdrop,
interest rates exhibited a high degree of volatility as yields rose on fears
that such a tight labor market would lead to higher inflation. By July, the
yield on the 30 year Treasury Bond had moved to 7.2% from 5.94% in January. Bond
investors who had anticipated that the Federal Reserve would raise short-term
interest rates at the July FOMC meeting to slow the pace of economic growth were
disappointed as the FOMC chose to leave rates unchanged. As various reports came
in during the third and fourth quarter, it became apparent that Federal Reserve
Chairman Greenspan had used a crystal ball and that economic growth was indeed
moderating. Despite a tight labor market, inflation also appeared well
contained. Bond prices began to rally as this new outlook unfolded and were
supported by weakness in retail sales, housing and lower monthly employment
gains.
THE CRESTFUNDS LIMITED TERM BOND FUND RESPONDED TO THESE MARKET CONDITIONS BY
REDUCING MATURITIES AND REPOSITIONING THE PORTFOLIO AMONG VARIOUS SECTORS. The
majority of the maturity reduction occurred during the first half of 1996 when
the Fund's average maturity was reduced from 3.8 years to 3.4 years. This
strategy was accomplished by reducing exposure to intermediate maturities and
investing in shorter dated bonds. Sector changes focused primarily on increasing
holdings within the short maturity asset-backed and mortgage sector in order to
acquire securities that offered higher yields relative to treasuries. As it
became apparent that economic growth was beginning to slow during the third
quarter and our market outlook was for interest rates to remain relatively
stable, the Fund continued to build exposure to the asset-backed/mortgage sector
and reduce exposure to corporate bonds. By fiscal year-end, maturities had been
extended to slightly under 4 years, corporate bonds had been reduced from 42% to
32%, and mortgages and asset-backed securities had been increased from 21% to
32%. This repositioning out of corporates into mortgages resulted in the overall
quality of securities in the Fund increasing from AA to AAA at fiscal year end.
LOOKING AHEAD, WE BELIEVE IT IS LIKELY THAT LONG-TERM INTEREST RATES WILL
CONTINUE TO TRADE WITHIN A BROAD RANGE OF 6-7% DURING 1997, FINISHING THE YEAR
LARGELY UNCHANGED FROM PRESENT LEVELS. Economic growth is expected to remain
moderate with inflation well contained. Accordingly, the Fed may leave
short-term interest rates unchanged. This view is supported by dramatic slowing
within the housing sector, moderating retail sales, slight increases in monthly
unemployment, and decreasing monthly employment gains. Commodity prices, a
leading indicator of building inflationary pressures, also appear to be on the
decline with Gold trading under $370 an ounce, the lowest level since late 1993.
Unknowns for 1997 include the possibility of a revision to the Consumer Price
Index, which in turn could lead to some concrete progress toward a balanced
budget amendment. Both events would be positive for fixed income investors.
FUND COMPOSITION (AS A PERCENTAGE OF TOTAL INVESTMENTS)
AS OF NOVEMBER 30, 1996
[Pie Chart Omitted]
Percentages for total Investments of Limited Term Bond Fund are as follows:
Cash Equivalents -- 1%
Treasuries & Agencies -- 33%
Corporates -- 33%
Mortgage/Asset Backed -- 33%
<PAGE>
CRESTFUNDS, INC.: LIMITED TERM BOND FUND
- --------------------------------------------------------------------------------
PERFORMANCE
TRUST CLASS
Comparison of Change in the Value of a $1,000,000
Investment in the CrestFunds Limited Term Bond Fund,
Trust Class, versus the Merrill Lynch 1-5 Year Gov't./Corp. Bond Index,
and the Lehman Intermediate Gov't/Corp Bond Index
[Line Chart Omitted]
Plot points for Limited Term Bond Fund Trust Class are as follows:
CrestFunds Limited Term Merrill Lynch 1-5 Year Lehman Inter.
Bond Fund Trust Class Gov't /Corp. Bond Index Gov't /Corp. Bond Index
9/30/92 1,000,000 1,000,000 1,000,000
Nov-92 988,630 987,133 983,249
Nov-93 1,076,025 1,064,722 1,078,920
Nov-94 1,059,132 1,060,570 1,059,283
Nov-95 1,180,932 1,190,383 1,212,985
Nov-96 1,234,310 1,259,664 1,283,702
The one-month return for the Merrill Lynch 1-5 Year Gov't/Corp for the month of
November 1992 was misstated as -3.59% in last years graph.
Trust Class shares are available to qualified individual or institutional
customers whose assets are managed and/or administered by Crestar Bank's Trust &
Investment Management Group.
A hypothetical $1 million investment in Trust Class shares of the Limited Term
Bond Fund, at the Fund's commencement of operations (9/28/92), including the
effect of Fund expenses but excluding account level fees, would have grown to
$1,234,310 by November 30, 1996. Over the same period, a $1 million investment
in Lehman Brothers Government/Corporate Intermediate Bond Index and the Merrill
Lynch 1-5 Year Government/Corporate Bond Index would have grown to $1,283,702
and $1,259,664, respectively.
INVESTORS CLASS A
Comparison of Change in the Value of a $10,000 Investment in
the CrestFunds Limited Term Bond Fund, Investor A, versus
the Merrill Lynch 1-5 Year Gov't./Corp. Bond Index,
and the Lehman Intermediate Gov't/Corp Bond Index
[Line Chart Omitted]
Plot points for Limited Term Bond Fund Investor Class A are as follows:
CrestFunds Limited Term Merrill Lynch 1-5 Year Lehman Inter.
Bond Fund Investor A Class Gov't /Corp. Bond Index Gov't /Corp. Bond Index
5/31/93 9,800 10,000 10,000
Nov-93 10,104 10,288 10,355
Nov-94 9,933 10,248 10,167
Nov-95 11,096 11,502 11,642
Nov-96 11,584 12,171 12,321
The one-month return for the Merrill Lynch 1-5 Year Gov't/Corp for the month of
November 1992 was misstated as -3.59% in last years graph.
Investors Class A shares are available to individual and institutional customers
investing directly in the Funds.
A hypothetical $10,000 investment in Investors Class A shares of the Limited
Term Bond Fund on the day that class commenced operations (5/19/93), including
the effect of the maximum 2.00% sales charge and the Investors Class A higher
transfer agency fee, would be valued at $11,584 by November 30, 1996. Over the
same period, a $10,000 investment in Lehman Brothers Government/Corporate
Intermediate Bond Index and the Merrill Lynch 1-5 Year Government/Corporate Bond
Index would have grown to $12,321 and $12,171, respectively.
AVERAGE ANNUAL TOTAL RETURN
FOR THE PERIOD ENDED NOVEMBER 30, 1996
--------------------------------------
TRUST CLASS INVESTORS CLASS A
----------- -----------------
with load without load
1 YEAR 4.52% 2.26% 4.40%
3 YEAR 4.68% 3.95% 4.66%
LIFE OF FUND 5.19% 4.23% 4.73%
CUMULATIVE TOTAL RETURN
FOR THE PERIOD ENDED NOVEMBER 30, 1996
--------------------------------------
TRUST CLASS INVESTORS CLASS A
----------- -----------------
with load without load
1 YEAR 4.52% 2.26% 4.40%
3 YEAR 14.71% 12.33% 14.65%
LIFE OF FUND 23.50% 15.75% 18.16%
Total returns are historical and include changes in share price and reinvestment
of dividends and capital gain distributions, if any. Life of Fund figures are
from commencement of operations per class to the period ended listed above. The
Lehman Brothers Government/Corporate Intermediate Bond Index, an unmanaged
index, is a broad measure of the performance of Intermediate (one-to ten-year)
bonds, Merrill Lynch 1-5 year Government/Corporate Bond Index, an unmanaged
index, is a broad measure of the performance of one to five year bonds. They
both include reinvestment of dividends and capital gains. Share price, yield and
return will vary, and you may have a gain or loss when you sell your shares.
Past performance is no guarantee of future results.
<PAGE>
CRESTFUNDS, INC.: INTERMEDIATE BOND FUND
- --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE
The Intermediate Bond Fund seeks to provide a high level of current income by
investing in investment-grade fixed income debt obligations. The Fund is managed
to maintain a dollar-weighted average portfolio maturity of between 5 and 10
years.
YEAR IN REVIEW
FISCAL YEAR ENDING NOVEMBER 1996 WAS CHALLENGING FOR BOND MARKET PARTICIPANTS.
After experiencing weakness throughout much of 1995, the US economy received a
much needed boost from the Federal Reserve when it lowered the Federal Funds
rate in December 1995 and again in January 1996 to its present level of 5.25%.
By the end of the first quarter of 1996, it was apparent that these lower
interest rates had provided consumers and businesses with the incentive to
increase spending. As the economy continued to strengthen during the second
quarter, each monthly employment report showed a rising number of newly created
jobs and a falling number of unemployed Americans. Against this backdrop,
interest rates exhibited a high degree of volatility as yields rose on fears
that such a tight labor market would lead to higher inflation. By July, the
yield on the 30 year Treasury Bond had moved to 7.2% from 5.94% in January. Bond
investors who had anticipated that the Federal Reserve would raise short-term
interest rates at the July FOMC meeting to slow the pace of economic growth were
disappointed as the FOMC chose to leave rates unchanged. As various reports came
in during the third and fourth quarter, it became apparent that Federal Reserve
Chairman Greenspan had used a crystal ball and that economic growth was indeed
moderating. Despite tight labor markets, inflation also appeared well contained.
Bond prices began to rally as this new outlook unfolded and were supported by
weakness in retail sales, housing and lower monthly employment gains.
CRESTFUNDS INTERMEDIATE BOND FUND RESPONDED TO THESE VOLATILE TIMES BY
SHORTENING MATURITIES DURING THE FIRST HALF OF THE YEAR AND BY REPOSITIONING
AMONG VARIOUS SECTORS. At the end of the last fiscal year, the Fund's average
maturity was slightly under 7 years. During the first half of the year,
maturities were shortened to 5.5 years. This strategy was accomplished by
reducing exposure to intermediate maturities and investing large new inflows the
Fund experienced during that period into shorter dated bonds. Sector changes
focused primarily on increasing holdings within the mortgage sector in order to
acquire securities that offered higher yields relative to treasuries. As it
became apparent that economic growth was beginning to slow during the third
quarter and our market outlook was for interest rates to remain relatively
stable, the Fund continued to build exposure to the mortgage sector and reduce
exposure to corporate bonds. As new money continued to flow into the Fund,
longer dated treasuries were also purchased. By fiscal year end, when the Fund
had almost tripled in size during the previous 12 months, maturities had been
extended to 7 years, corporate bonds had been reduced from 39% to 34%, and
mortgages and asset-backed securities had been increased from 14% to 24%.
Following this shift from corporates into mortgages, the overall quality of
securities in the Fund remained AA at fiscal year end.
LOOKING AHEAD, WE BELIEVE IT IS LIKELY THAT LONG-TERM INTEREST RATES WILL
CONTINUE TO TRADE WITHIN A BROAD RANGE OF 6-7% DURING 1997, FINISHING THE YEAR
LARGELY UNCHANGED FROM PRESENT LEVELS. Economic growth is expected to remain
moderate with inflation well contained. Accordingly, the Fed may leave
short-term interest rates unchanged. This view is supported by dramatic slowing
within the housing sector, moderating retail sales, slight increases in monthly
unemployment, and decreasing monthly employment gains. Commodity prices, a
leading indicator of building inflationary pressures, also appear to be on the
decline with Gold trading under $370 an ounce, the lowest level since late 1993.
Unknowns for 1997 include the possibility of a revision to the Consumer Price
Index which in turn could lead to some concrete progress toward a balanced
budget amendment. Both events would be positive for fixed income investors.
FUND COMPOSITION (AS A PERCENTAGE OF TOTAL INVESTMENTS)
AS OF NOVEMBER 30, 1996
[Pie Chart Omitted]
Percentages for total Investments of Intermediate Bond Fund as as follows:
Cash Equivalents -- 3%
Treasuries & Agencies -- 39%
Corporates -- 34%
Mortgage/Asset Backed -- 24%
<PAGE>
CRESTFUNDS, INC.: INTERMEDIATE BOND FUND
- --------------------------------------------------------------------------------
PERFORMANCE
TRUST CLASS
Comparison of Change in the Value of a $1,000,000
Investment in the CrestFunds Intermediate Bond Fund,
Trust Class, versus the Lehman Brothers Aggregate Bond Index
[Line Chart Omitted]
Plot points for Intermediate Bond Fund Trust Class are as follows:
CrestFunds Intermediate Lehman Bros.
Bond Fund Trust Class Aggregate Bond Index
9/30/92 1,000,000 1,000,000
Nov-92 976,020 986,897
Nov-93 1,079,283 1,094,469
Nov-94 1,028,233 1,060,978
Nov-95 1,203,752 1,248,241
Nov-96 1,250,939 1,323,760
Trust Class shares are available to qualified individual
or institutional customers whose assets are managed and/or administered by
Crestar Bank's Trust & Investment Management Group.
A hypothetical $1 million investment in Trust Class shares of the
Intermediate Bond Fund, at the Fund's commencement of operations (9/28/92),
including the effect of Fund expenses but excluding account level fees, would
have grown to $1,250,939 by November 30, 1996. Over the same period, a $1
million investment in Lehman Brothers Aggregate Bond Index would have grown to
$1,323,760.
INVESTORS CLASS A
Comparison of Change in the Value of a $10,000
Investment in the CrestFunds Intermediate Bond Fund,
Investor A Class, versus the Lehman Brothers Aggregate Bond Index
[Line Chart Omitted]
Plot points for Intermediate Bond Fund Investor Class A are as follows:
CrestFunds Intermediate Lehman Bros.
Bond Fund Investors Class A Aggregate Bond Index
5/31/93 9,700 10,000
Nov-93 10,032 10,396
Nov-94 9,559 10,078
Nov-95 11,191 11,856
Nov-96 11,629 12,574
Investors Class A shares are available to individual and institutional customers
investing directly in the Funds.
A hypothetical $10,000 investment in Investors Class A shares of the
Intermediate Bond Fund on the day that class commenced operations (5/11/93),
including the effect of the maximum 3.00% sales charge and the Investors Class A
higher transfer agency fee, would be valued at $11,629 by November 30, 1996.
Over the same period, a $10,000 investment in Lehman Brothers Aggregate Bond
Index would have grown to $12,574.
AVERAGE ANNUAL TOTAL RETURN
FOR THE PERIOD ENDED NOVEMBER 30, 1996
- --------------------------------------------------------------------------------
TRUST CLASS INVESTORS CLASS A
----------- -----------------
with load without load
1 YEAR 3.92% 0.82% 3.91%
3 YEAR 5.05% 3.97% 5.05%
LIFE OF FUND 5.59% 4.09% 5.00%
CUMULATIVE TOTAL RETURN
FOR THE PERIOD ENDED NOVEMBER 30, 1996
- --------------------------------------------------------------------------------
TRUST CLASS INVESTORS CLASS A
----------- -----------------
with load without load
1 YEAR 3.92% 0.82% 3.91%
3 YEAR 15.91% 12.39% 15.92%
LIFE OF FUND 25.53% 15.33% 18.95%
Total returns are historical and include changes in share price and reinvestment
of dividends and capital gain distributions, if any. Life of Fund figures are
from commencement of operations per class to the period ended listed above. The
Lehman Brothers Aggregate Bond Index, an unmanaged index, is a broad measure of
bond performance. It includes reinvestment of dividends and capital gains. Share
price, yield and return will vary, and you may have a gain or loss when you sell
your shares. Past performance is no guarantee of future results.
<PAGE>
CRESTFUNDS, INC.: GOVERNMENT BOND FUND
- --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE
The Government Bond Fund seeks to provide a high level of current income in a
manner consistent with preserving principal by investing primarily in
obligations issued or guaranteed by US Government or its agencies or
instrumentalities. There are no limits on the dollar-weighted average portfolio
maturity of the Fund.
YEAR IN REVIEW
FISCAL YEAR ENDING NOVEMBER 1996 WAS CHALLENGING FOR BOND MARKET PARTICIPANTS.
After experiencing weakness throughout much of 1995, the US economy received a
much needed boost from the Federal Reserve when it lowered the Federal Funds
rate in December 1995 and again in January 1996 to its present level of 5.25%.
By the end of the first quarter of 1996, it was apparent that these lower
interest rates had provided consumers and businesses with the incentive to
increase spending. As the economy continued to strengthen during the second
quarter, each monthly employment report showed a rising number of newly created
jobs and a falling number of unemployed Americans. Against this backdrop,
interest rates exhibited a high degree of volatility as yields rose on fears
that such a tight labor market would lead to higher inflation. By July, the
yield on the 30 year Treasury Bond had moved to 7.2% from 5.94% in January. Bond
investors who had anticipated that the Federal Reserve would raise short-term
interest rates at the July FOMC meeting to slow the pace of economic growth were
disappointed as the FOMC chose to leave rates unchanged. As various reports came
in during the third and fourth quarter, it became apparent that Greenspan had
used a crystal ball and that economic growth was indeed moderating. Despite a
tight labor market, inflation also appeared well contained. Bond prices began to
rally as this new outlook unfolded and were supported by weakness in retail
sales, housing and lower monthly employment gains.
CRESTFUNDS GOVERNMENT BOND FUND RESPONDED TO THESE VOLATILE TIMES BY
SHORTENING MATURITIES DURING THE FIRST HALF OF THE YEAR AND BY REPOSITIONING
AMONG VARIOUS SECTORS. At the end of the last fiscal year, the Fund's average
maturity was 9.5 years. During the first half of the year, maturities were
shortened to 7.25 years. This strategy was accomplished by reducing exposure to
long maturities and investing large new inflows the Fund experienced during that
period into short and intermediate maturity bonds. Sector changes focused
primarily on increasing holdings within the mortgage sector in order to acquire
securities that offered higher yields relative to treasuries. As it became
apparent that economic growth was beginning to slow during the third quarter and
our market outlook was for interest rates to remain relatively stable, the Fund
continued to build exposure to the mortgage sector and reduce exposure to
corporate bonds. As new money continued to flow into the Fund, longer dated
treasuries were also purchased. By fiscal year end, when the Fund had doubled in
size during the previous 12 months, corporate bonds had been reduced from 23% to
16% and mortgages and asset-backed securities had been increased from 4% to 19%.
This repositioning out of corporates and into mortgages resulted in the overall
quality of securities in the Fund remaining AAA at fiscal year end.
LOOKING AHEAD, WE BELIEVE IT IS LIKELY THAT LONG-TERM INTEREST RATES WILL
CONTINUE TO TRADE WITHIN A BROAD RANGE OF 6-7% DURING 1997, FINISHING THE YEAR
LARGELY UNCHANGED FROM PRESENT LEVELS. Economic growth is expected to remain
moderate with inflation well contained. Accordingly, the Fed may leave
short-term interest rates unchanged. This view is supported by dramatic slowing
within the housing sector, moderating retail sales, slight increases in monthly
unemployment, and decreasing monthly employment gains. Commodity prices, a
leading indicator of building inflationary pressures, also appear to be on the
decline with Gold trading under $370 an ounce, the lowest level since late 1993.
Unknowns for 1997 include the possibility of a revision to the Consumer Price
Index which in turn could lead to some concrete progress toward a balanced
budget amendment. Both events would be positive for fixed income investors.
FUND COMPOSITION (AS A PERCENTAGE OF TOTAL INVESTMENTS)
AS OF NOVEMBER 30, 1996
[Pie Chart Omitted]
Percentages for total Investments of Government Bond Fund are as follows:
Cash Equivalents -- 8%
Treasuries & Agencies -- 58%
Corporates -- 16%
Mortgage/Asset Backed -- 18%
<PAGE>
CRESTFUNDS, INC.: GOVERNMENT BOND FUND
- --------------------------------------------------------------------------------
PERFORMANCE
TRUST CLASS
Comparison of Change in the Value of a $1,000,000
Investment in the CrestFunds Government Bond Fund,
Trust Class, versus the Lehman Brothers Government Bond Index
[Line Chart Omitted]
Plot points for Government Bond Fund Investor Class B are as follows:
CrestFunds Gov't Bond Fund Lehman Bros. Gov't. Bond Index
Investor B Class
4/30/95 1,000,000 1,000,000
Nov-95 1,110,104 1,099,906
Nov-96 1,143,629 1,158,311
Trust Class shares are available to qualified individual or institutional
customers whose assets are managed and/or administered by Crestar Bank's Trust &
Investment Management Group.
A hypothetical $1 million investment in Trust Class shares of the Government
Bond Fund, at the Fund's commencement of operations (4/5/95), including the
effect of Fund expenses but excluding account level fees, would have grown to
$1,143,629 by November 30, 1996. Over the same period, a $1 million investment
in Lehman Brothers Government Bond Index would have grown to $1,158,311.
INVESTORS CLASS B
Comparison of Change in the Value of a $10,000
Investment in the CrestFunds Government Bond Fund,
Investor B Class, versus the Lehman Brothers Government Bond Index
[Line Chart Omitted]
Plot points for Government Bond Fund Investor Class B are as follows:
CrestFunds Gov't Bond Fund Lehman Bros. G.O. Bond Index
Investor B Class
4/30/95 10,000 10,000
Nov-95 10,666 10,999
Nov-96 10,901 11,583
Investors Class B shares are available to individual and institutional customers
investing directly in the Funds.
A hypothetical $10,000 investment in Investors Class B shares of the
Government Bond Fund on the day that class commenced operations (4/19/95),
including the effect of a Contingent Deferred Sales Charge and the Investors
Class B higher transfer agency fee and 12B-1 fee, would be valued at $10,901
by November 30, 1996. Over the same period, a $10,000 investment in Lehman
Brothers Government Bond Index would have grown to $11,583.
AVERAGE ANNUAL TOTAL RETURN
FOR THE PERIOD ENDED NOVEMBER 30, 1996
- --------------------------------------------------------------------------------
TRUST CLASS INVESTORS CLASS B
----------- -----------------
with back-end load without back-end load
1 YEAR 3.02% -2.74% 2.12%
LIFE OF FUND 8.92% 5.60% 7.97%
CUMULATIVE TOTAL RETURN
FOR THE PERIOD ENDED NOVEMBER 30, 1996
- --------------------------------------------------------------------------------
TRUST CLASS INVESTORS CLASS B
----------- -----------------
with back-end load without back-end load
1 YEAR 3.02% -2.74% 2.12%
LIFE OF FUND 15.22% 9.22% 13.22%
Total returns are historical and include changes in share price and reinvestment
of dividends and capital gain distributions, if any. Life of Fund figures are
from commencement of operations per class to the period ended listed above. The
Lehman Brothers Government Bond Index, an unmanaged index, is a broad measure of
the performance of government bonds. It includes reinvestment of dividends and
capital gains. Share price, yield and return will vary, and you may have a gain
or loss when you sell your shares.
<PAGE>
CRESTFUNDS, INC.: VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE
The Virginia Intermediate Municipal Bond Fund seeks to provide a high level of
income exempt from federal and Virginia income tax in a manner consistent with
the preservation of capital by investing in municipal bonds of investment grade
quality. The Fund is managed to maintain a dollar-weighted average portfolio
maturity of between 5 and 10 years.
YEAR IN REVIEW
THE NOVEMBER 1996 FISCAL YEAR ENDED WITH INTEREST RATES APPROXIMATELY THE SAME
AS 12 MONTHS AGO, BUT NOT WITHOUT SIGNIFICANT VOLATILITY ALONG THE WAY. At the
beginning of the fiscal year, when investors believed that the economy was
growing at a slow but sustainable noninflationary pace, interest rates
approached their lows for the year. The trend reversed abruptly in mid-February
as the employment report showed a sharp increase in jobs, causing investors to
begin fearing an inflationary acceleration in growth. Finally in the fall,
interest rates fell quickly as economic growth moderated and inflation fears
receded.
TAX-EXEMPT BONDS OUTPERFORMED TAXABLE BONDS OVER MOST OF THE FISCAL YEAR DUE
TO SEVERAL FACTORS. New issue supply slowed as refunding activity declined in
response to higher interest rates. Retail demand improved as buyers were enticed
by higher yields throughout most of the year. This tight supply/demand situation
particularly benefited specialty states such as Virginia and Maryland, where
secondary supply was limited. Also, fears of major tax reform, which plagued the
market for much of 1995, diminished as Clinton fashioned a sizable lead in the
polls.
WE MADE SEVERAL STRATEGY ADJUSTMENTS THROUGHOUT THE YEAR TO HELP THE FUND
COPE WITH A VOLATILE INTEREST RATE ENVIRONMENT. Early in the fiscal year we were
able to add 7-15 year tax-exempt bonds to the portfolio when the ratio of
tax-exempt yields to Treasury yields was historically high because of Tax Reform
fears, indicating that tax-exempts were very attractive relative to taxable
bonds. As interest rates rose in late February, March and April, we shifted
emphasis to purchases of pre-refunded bonds, and thus, moderately shortened the
average maturity of the Fund. Later in the year, as interest rates were
beginning to decline, we used the very liquid, high quality, short dated
pre-refunded bonds as a source of funds for reinvestment in longer term, high
yielding revenue issues in the lease revenue and health care sectors. The Fund
ended the year with an average maturity of 8.4 years. Consistent with a slow
growth, moderate inflation environment, we have sought to maintain a high
overall security credit quality of AA and increase call protection whenever
possible.
LOOKING AHEAD, MUNICIPAL BOND YIELDS CONTINUE TO APPEAR RELATIVELY
ATTRACTIVE. High quality, long-term tax-exempts are likely to continue to trade
within a broad 5-6% range during 1997. Economic growth is expected to remain
moderate with inflation well contained. Accordingly, the Federal Reserve may
leave short-term interest rates unchanged. Municipal bond yields should continue
to find support during the coming year from several factors. These factors
include a continued moderation in supply due to conservative attitudes about
spending by state and local governments, increased demand from aging Baby
Boomers who are increasingly likely to seek a stable source of after-tax income,
and a more volatile stock market -- particularly if stocks begin undergoing more
normal "correction" patterns.
FUND COMPOSITION (AS A PERCENTAGE OF TOTAL INVESTMENTS)
AS OF NOVEMBER 30, 1996
[Pie Chart Omitted]
Percentages for total Investments of Virginia Intermediate Muncipal Bond Fund
are as follows:
0-3 Years -- 11%
3-5 Years -- 24%
5-7 Years -- 10%
7-10 Years -- 16%
10-15 Years -- 28%
15-20 Years -- 11%
20 + Years -- 0%
<PAGE>
CRESTFUNDS, INC.: VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
PERFORMANCE
TRUST CLASS
Comparison of Change in the Value of a $1,000,000
Investment in the CrestFunds VA Intermediate Muni Bond Fund,
Trust Class, versus the Lehman Brothers 5 Year G.O. Bond Index,
and the Lehman Brothers G.O. Bond Index
[Line Chart Omitted]
Plot points for Virginia Intermediate Municpal Bond Fund Trust Class are as
follows:
CrestFunds VA Inter. Muni Lehman Bros. 5 Year Lehman Bros.
Bond Fund Trust Class G.O. Bond Index G.O. Bond Index
1/31/93 1,000,000 1,000,000 1,000,000
Nov-93 1,066,043 1,059,356 1,080,941
Nov-94 996,324 1,049,822 1,033,488
Nov-95 1,156,632 1,175,695 1,212,281
Nov-96 1,203,013 1,238,713 1,285,136
Trust Class shares are available to qualified individual or institutional
customers whose assets are managed and/or administered by Crestar Bank's Trust &
Investment Management Group.
A hypothetical $1 million investment in Trust Class shares of the Virginia
Intermediate Municipal Bond Fund, at the Fund's commencement of operations
(1/11/93), including the effect of Fund expenses but excluding account level
fees, would have grown to $1,203,013 by November 30, 1996. Over the same period,
a $1 million investment in Lehman Brothers General Obligation Bond Index and
Lehman Brothers 5 Year General Obligation Bond Index would have grown to
$1,285,139 and $1,238,713, respectively.
INVESTORS CLASS A
Comparison of Change in the Value of a $10,000
Investment in the CrestFunds VA Intermediate Muni Bond Fund,
Investor A Class, versus the Lehman Brothers 5 Year G.O. Bond Index,
and the Lehman Brothers G.O. Bond Index
[Line Chart Omitted]
Plot points for Virginia Intermediate Municpal Bond Fund Investor Class A are as
follows:
CrestFunds VA Inter. Muni Lehman Bros. 5 Year Lehman Bros.
Bond Fund Investor A Class G.O. Bond Index G.O. Bond Index
5/31/93 9,650 10,000 10,000
Nov-93 9,996 10,340 10,428
Nov-94 9,40 10,246 9,970
Nov-95 10,844 11,475 11,695
Nov-96 11,279 12,090 12,398
Investors Class A shares are available to individual and institutional
customers investing directly in the Funds.
A hypothetical $10,000 investment in Investors Class A shares of the
Virginia Intermediate Municipal Bond Fund on the day that class commenced
operations (5/5/93), including the effect of the maximum 3.50% sales charge and
the Investors Class A higher transfer agency fee would be valued at $11,279 by
November 30, 1996. Over the same period, a $10,000 investment in Lehman Brothers
General Obligation Bond Index and Lehman Brothers 5 Year General Obligation Bond
Index would have grown to $12,398 and $12,090, respectively.
AVERAGE ANNUAL TOTAL RETURN
FOR THE PERIOD ENDED NOVEMBER 30, 1996
- --------------------------------------------------------------------------------
TRUST CLASS INVESTORS CLASS A
----------- -----------------
with load without load
1 YEAR 4.01% 0.38% 4.01%
3 YEAR 4.12% 2.89% 4.11%
LIFE OF FUND 5.04% 3.36% 4.39%
CUMULATIVE TOTAL RETURN
FOR THE PERIOD ENDED NOVEMBER 30, 1996
- --------------------------------------------------------------------------------
TRUST CLASS INVESTORS CLASS A
----------- -----------------
with load without load
1 YEAR 4.01% 0.38% 4.01%
3 YEAR 12.86% 8.93% 12.83%
LIFE OF FUND 21.04% 12.52% 16.58%
Total returns are historical and include changes in share price and reinvestment
of dividends and capital gain distributions, if any. Life of Fund figures are
from commencement of operations per class to the period ended listed above. The
Lehman Brothers General Obligation Bond Index, an unmanaged index, is a broad
measure of the performance of tax-exempt bonds. The Lehman Brothers 5 year
General Obligation Bond Index, an unmanaged index, is a broad measure of the
performance of 1-5 year tax-exempt bonds. They both include reinvestment of
dividends and capital gains. Share price, yield and return will vary, and you
may have a gain or loss when you sell your shares. Past performance is no
guarantee of future results.
<PAGE>
CRESTFUNDS, INC.: VIRGINIA MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE
The Virginia Municipal Bond Fund seeks to provide a high level of current income
exempt from federal and Virginia income tax in a manner consistent with the
preservation of capital by investing in municipal bonds of investment grade
quality.
There are no limits on the dollar-weighted portfolio maturity of the Fund.
YEAR IN REVIEW
THE NOVEMBER 1996 FISCAL YEAR ENDED WITH INTEREST RATES APPROXIMATELY THE SAME
AS 12 MONTHS AGO, BUT NOT WITHOUT SIGNIFICANT VOLATILITY ALONG THE WAY. At the
beginning of the fiscal year, when investors believed that the economy was
growing at a slow but sustainable noninflationary pace, interest rates
approached their lows for the year. The trend reversed abruptly in mid-February
as the employment report showed a sharp increase in jobs, causing investors to
begin fearing an inflationary acceleration in growth. Finally in the fall,
interest rates fell quickly as economic growth moderated and inflation fears
receded.
TAX-EXEMPT BONDS OUTPERFORMED TAXABLE BONDS OVER MOST OF THE FISCAL YEAR DUE
TO SEVERAL FACTORS. New issue supply slowed as refunding activity declined in
response to higher interest rates. Retail demand improved as buyers were enticed
by higher yields throughout most of the year. This tight supply/demand situation
particularly benefited specialty states such as Virginia and Maryland, where
secondary supply was limited. Also, fears of major tax reform which plagued the
market for much of 1995, diminished as Clinton fashioned a sizable lead in the
polls.
WE MADE SEVERAL STRATEGY ADJUSTMENTS THROUGHOUT THE YEAR TO HELP THE FUND
COPE WITH A VOLATILE INTEREST RATE ENVIRONMENT. Early in the fiscal year we were
able to add 15-30 year tax-exempt bonds to the portfolio when the ratio of
tax-exempt yields to Treasury yields was historically high because of Tax Reform
fears, indicating that tax-exempts were very attractive relative to taxable
bonds. As interest rates rose in late February, March and April, we shifted
emphasis to purchases of pre-refunded bonds, and thus, moderately shortened the
average maturity of the Fund. Later in the year as interest rates were beginning
to decline, we used the very liquid, high quality, short dated pre-refunded
bonds as a source of funds for reinvestment in longer term, high yielding
revenue issues in the lease revenue and health care sectors. The Fund ended the
year with an average maturity of 15.7 years. Consistent with a slow growth,
moderate inflation environment, we have sought to maintain a high overall credit
quality of AA and increase call protection whenever possible.
LOOKING AHEAD, MUNICIPAL BOND YIELDS CONTINUE TO APPEAR RELATIVELY
ATTRACTIVE. High quality tax-exempts are likely to continue to trade within a
broad 5-6% range during 1997. Economic growth is expected to remain moderate
with inflation well contained. Accordingly, the Federal Reserve may leave
short-term interest rates unchanged. Municipal bond yields should continue to
find support during the coming year from several factors. These factors include
a continued moderation in supply due to conservative attitudes about spending by
state and local governments, increased demand from aging Baby Boomers who are
increasingly likely to seek a stable source of after-tax income, and more
volatile stock market -- particularly if stocks begin undergoing more normal
"correction" patterns.
FUND COMPOSITION (AS A PERCENTAGE OF TOTAL INVESTMENTS)
AS OF NOVEMBER 30, 1996
[Pie Chart Omitted]
Percentages for total Investments of Virginia Municipal Bond Fund are as
follows:
0-3 Years -- 7%
3-5 Years -- 6%
7-10 Years -- 6%
10-15 Years -- 26%
15-20 Years -- 30%
20-25 Years -- 13%
25 + Years -- 12%
<PAGE>
CRESTFUNDS, INC.: VIRGINIA MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
PERFORMANCE
TRUST CLASS
Comparison of Change in the Value of a $1,000,000
Investment in the CrestFunds Virginia Municipal Bond Fund,
Trust Class, versus the Lehman Brothers General Obligation Bond Index
[Line Chart Omitted]
Plot points for Virginia Municpal Bond Fund Trust Class are as follows:
CrestFunds VA Muni Bond Fund Lehman Bros. G.O. Bond Index
Trust Class
4/30/95 1,000,000 1,000,000
Nov-95 1,082,859 1,081,567
Nov-96 1,120,542 1,146,570
Trust Class shares are available to qualified individual or institutional
customers whose assets are managed and/or administered by Crestar Bank's Trust &
Investment Management Group.
A hypothetical $1 million investment in Trust Class shares of the Virginia
Municipal Bond Fund, at the Fund's commencement of operations (4/5/95),
including the effect of Fund expenses but excluding account level fee, would
have grown to $1,120,542 by November 30, 1996. Over the same period, a $1
million investment in Lehman Brothers General Obligation Bond Index would have
grown to $1,146,570.
INVESTORS CLASS B
Comparison of Change in the Value of a $10,000
Investment in the CrestFunds Virginia Municipal Bond Fund,
Investor B Class, versus the Lehman Brothers General Obligation Bond Index
[Line Chart Omitted]
Plot points for Virginia Municpal Bond Fund Investor Class B are as follows:
CrestFunds VA Muni Bond Fund Lehman Bros. G.O. Bond Index
Investor B Class
4/30/95 10,000 10,000
Nov-95 10,793 10,816
Nov-96 10,672 11,466
Ivestors Class B shares are available to individual and institutional customers
investing directly in the Funds.
A hypothetical $10,000 investment in Investors Class B shares of the
Virginia Municipal Bond Fund on the day that class commenced operations
(4/17/95), including the effect of a Contingent Deferred Sales Charge and the
Investors Class B higher transfer agency fee and 12B-1 fee, would be valued at
$10,672 by November 30, 1996. Over the same period, a $10,000 investment in
Lehman Brothers General Obligation Bond Index would have grown to $11,466.
AVERAGE ANNUAL TOTAL RETURN
FOR THE PERIOD ENDED NOVEMBER 30, 1996
--------------------------------------
TRUST CLASS INVESTORS CLASS B
----------- -----------------
with back-end load without back-end load
1 YEAR 3.48% -2.36% 2.58%
LIFE OF FUND 6.74% 3.20% 5.58%
CUMULATIVE TOTAL RETURN
FOR THE PERIOD ENDED NOVEMBER 30, 1996
--------------------------------------
TRUST CLASS INVESTORS CLASS B
----------- -----------------
with back-end load without back-end load
1 YEAR 3.48% -2.36% 2.58%
LIFE OF FUND 11.41% 5.26% 9.26%
Total returns are historical and include changes in share price and reinvestment
of dividends and capital gain distributions, if any. Life of Fund figures are
from commencement of operations per class to the period ended listed above. The
Lehman Brothers General Obligation Bond Index, an unmanaged index, is a broad
measure of the performance of tax-exempt bonds. It includes reinvestment of
dividends and capital gains. Share price, yield and return will vary, and you
may have a gain or loss when you sell your shares. Past performance is no
guarantee of future results.
<PAGE>
CRESTFUNDS, INC.: MARYLAND MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE
The Maryland Municipal Bond Fund seeks to provide a high level of current income
exempt from federal and Maryland income tax in a manner consistent with the
preservation of capital by investing in Municipal Bonds of investment grade
quality. There are no limits on the dollar-weighted average portfolio maturity
of the Fund.
YEAR IN REVIEW
SINCE ITS INCEPTION IN MARCH, THE FUND HAS MORE THAN DOUBLED IN SIZE AND HAS
BENEFITED FROM THE RECENT DROP IN INTEREST RATES. Consistent with the objective
of providing tax-exempt income, the Fund invests in longer term, high quality,
Maryland municipal bonds.
THIS FUND'S INCEPTION WAS AT WHAT WE NOW KNOW TO HAVE BEEN A TURNING POINT IN
INTEREST RATES. Our original strategy was to use the late February back up in
interest rates to invest in longer, higher yielding Maryland municipal bonds. As
interest rates continued to rise, we shifted emphasis to purchases of
pre-refunded bonds to moderately shorten the average maturity. Then, as interest
rates were beginning to decline later in the year, we used the very liquid, high
quality, short dated pre-refunded bonds as a source of funds for reinvestment in
longer term, high yielding revenue issues in the lease revenue and health care
sectors. The Fund ended the November 30, 1996 year with an average maturity of
13 years. Consistent with a slow growth, moderate inflation environment, we have
sought to maintain a high overall security credit quality of AAA and increase
call protection whenever possible.
LOOKING AHEAD, MUNICIPAL BOND YIELDS CONTINUE TO APPEAR RELATIVELY
ATTRACTIVE. High quality, long-term tax-exempts are likely to continue to trade
with a broad 5-6% range during 1997. Economic growth is expected to remain
moderate with inflation well contained. Accordingly, the Federal Reserve may
leave short-term interest rates unchanged. Municipal bond yields should continue
to find support during the coming year from several factors. These could include
a continued moderation in supply due to conservative attitudes about spending by
state and local governments, increased demand from aging Baby Boomers who are
increasingly likely to seek a stable source of after-tax income, and a more
volatile stock market -- particularly if stocks begin undergoing more normal
"correction" patterns.
FUND COMPOSITION (AS A PERCENTAGE OF TOTAL INVESTMENTS)
AS OF NOVEMBER 30, 1996
[Pie Chart Omitted]
Percentages for total Investments of Maryland Municipal Bond Fund are as
follows:
0-3 Years -- 8%
3-5 Years -- 8%
5-7 Years -- 3%
7-10 Years -- 16%
10-15 Years --26%
15-20 Years -- 25%
20-25 Years -- 8%
30+ Years -- 6%
<PAGE>
CRESTFUNDS, INC.: MARYLAND MUNICIPAL BOND FUND
- --------------------------------------------------------------------------------
PERFORMANCE
TRUST CLASS
Comparison of Change in the Value of a $1,000,000
Investment in the CrestFunds Maryland Municipal Bond Fund,
Trust Class, versus the Lehman Brothers General Obligation Bond Index
[Line Chart Omitted]
Plot points for Maryland Municipal Bond Fund Trust Class are as follows:
CrestFunds Maryland Muni Bond Lehman Bros. G.O Bond Index
Trust Class
3/31/96 1,000,000 1,000,000
Nov-96 1,041,103 1,058,215
Trust Class shares are available to qualified individual or institutional
customers whose assets are managed and/or administered by Crestar Bank's Trust &
Investment Management Group.
A hypothetical $1 million investment in Trust Class shares of the Maryland
Municipal Bond Fund, at the Fund's commencement of operations March 1, 1996,
including the effect of Fund expenses but excluding account level fees, would
have grown to $1,041,103 by November 30, 1996. Over the same period, a $1
million investment in Lehman Brothers General Obligation Bond Index would have
grown to $1,058,215.
INVESTORS CLASS B
Comparison of Change in the Value of a $10,000
Investment in the CrestFunds Maryland Municipal Bond Fund,
Investor B Class, versus the Lehman Brothers General Obligation Bond Index
[Line Chart Omitted]
Plot points for Maryland Municipal Bond Fund Class B are as follows:
CrestFunds Maryland Muni Bond Lehman Bros. G.O Bond Index
Investors B Class
4/30/96 10,000 10,000
Nov-96 10,459 10,619
Investors Class B shares are available to individual and institutional customers
investing directly in the Funds.
A hypothetical $10,000 investment in Investors Class B shares of the
Maryland Municipal Bond Fund on the day that class commenced operations April
25, 1996, including the effect of a Contingent Deferred sales charge and the
Investors Class B higher transfer agency fee and 12B-1 fee, would be valued at
$10,459 by November 30, 1996. Over the same period, a $10,000 investment in
Lehman Brothers General Obligation Bond Index would have grown to $10,619.
AVERAGE ANNUAL TOTAL RETURN
FOR THE PERIOD ENDED NOVEMBER 30, 1996
--------------------------------------
TRUST CLASS INVESTORS CLASS B
----------- -----------------
with back-end load without back-end load
LIFE OF FUND 1.07% -0.78% 7.67%
CUMULATIVE TOTAL RETURN
FOR THE PERIOD ENDED NOVEMBER 30, 1996
--------------------------------------
TRUST CLASS INVESTORS CLASS B
----------- -----------------
with load without load
LIFE OF FUND 0.80% -0.47% 4.53%
Total returns are historical and include changes in share price and reinvestment
of dividends and capital gain distribution, if any. Life of Fund figures are
from commencement of operations per class to the period ended listed above. The
Lehman Brothers General Obligation Bond Index, an unmanaged index, is a broad
measure of the performance of tax-exempt bonds. The Lehman Brothers 5 year
General Obligation Bond Index, an unmanaged index, is a broad measure of the
performance of 1-5 year tax-exempt bonds. They both include reinvestment of
dividends and capital gains. Share price, yield and return will vary, and you
may have a gain or loss when you sell your shares. Past performance is no
guarantee of future results.
<PAGE>
CRESTFUNDS, INC.: VALUE FUND
- --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE
The Value Fund seeks to provide long-term capital appreciation and, as a
secondary objective, current income, by investing primarily in income producing
equity securities of companies with large market capitalizations. Investments
are broadly diversified among major economic sectors and among those securities
with above-average total return potential.
YEAR IN REVIEW
THE EQUITY MARKETS AGAIN DELIVERED SURPRISINGLY STRONG RETURNS FOR THE YEAR
ENDING NOVEMBER 30, 1996. While not fully matching the robust results of 1995,
1996's gains have provided equity investors one of the top consecutive yearly
returns since the Depression. At the beginning of the year, upbeat investor
expectations were being expressed through record new investments into equity
mutual funds. Despite a new set of worries that materialized throughout the year
- -- winter recessionary jitters that melted into overheated summer economic
concerns, predictions of renewed inflation, forecasted potential adverse
political consequences behind the national elections, and a certain, imminent
and broad based collapse in corporate profits -- investors remained confident
and plowed an eye-popping $200 billion + into the equity markets during 1996.
With the benign economic, interest rate, and inflation back drop that unfolded,
this liquidity served as the relentless driver for the markets throughout the
year.
THE VALUE FUND ENJOYED STRONG RETURNS OF 22.7% (TRUST CLASS) FOR THE FISCAL
YEAR. Asset size grew to $577 million at year end from $235 million the previous
year, a gain of 145%. Inclusive of this growth was approximately $198 million
converted from the Crestar Value Common Trust Fund in September. We boosted the
Fund's exposure both to consumer non-durables/healthcare and financials, two
areas that can benefit further from the slower economic outlook we foresee in
1997. The financial sector remains particularly attractive both because of the
favorable impact of lower interest rates and the company-specific advantages
from aggressive restructuring and consolidation that is occurring. We have been
selective in maintaining our consumer non-durable exposure, as higher valuation
levels have made the dichotomy between winners and losers more pronounced.
CONVERSELY, WE HAVE REDUCED OUR COMMITMENT TO AREAS DEPENDENT UPON CONSUMER
SPENDING, WHERE EARNINGS PROBLEMS AND SENSITIVITY TO A SLOWER ECONOMIC PACE
APPEARS TO BE THE MOST ENTRENCHED. Shortfall in earnings and/or a weakening in
the fundamental picture has been dealt with harshly in this market, a trend we
see continuing. Across all sectors of the market, we have emphasized stocks with
emerging or sustainable earnings, whether because of market position, product
cycle, or tangible restructuring activities initiated by management. The
restructuring of corporate America, while a maturing theme, still offers a
number of outstanding opportunities on a company-specific basis.
HISTORY WOULD SUGGEST THAT, FOLLOWING TWO SENSATIONAL RETURN YEARS AND
ENTERING THE FIRST YEAR OF THE NEW PRESIDENTIAL TERM, THE MARKETS MAY BE POISED
FOR A BREATHER. Still, we seem to be entering the new year with investor
confidence high, equity mutual fund inflows gushing, a powerful market tailwind,
and seemingly only blue skies on the horizon. We expect the interplay of market
fundamentals, liquidity, and market sentiment to produce volatility that will
test investor confidence in the months ahead. Expectations are elevated along
with market; the challenge in 1997 will be to gradually dampen some of the
unrealistically high hopes without significantly impacting the overall market.
FUND COMPOSITION (AS A PERCENTAGE OF TOTAL INVESTMENTS)
AS OF NOVEMBER 30, 1996
[Pie Chart Omitted]
Percentages for total Investments of Value Fund are as follows:
Basic Materials -- 8%
Capital Goods -- 9%
Consumer Cyclicals -- 10%
Consumer Non-Durables -- 11%
Diversified -- 2%
Energy -- 11%
Finance -- 16%
Staples -- 10%
Technology -- 10%
Transportation -- 3%
Utilities -- 10%
<PAGE>
CRESTFUNDS, INC.: VALUE FUND
- --------------------------------------------------------------------------------
PERFORMANCE
TRUST CLASS
Comparison of Change in the Value of a $1,000,000
Investment in the CrestFunds Value Fund,
Trust Class, versus the Standard & Poor's 500 Composite Index
[Line Chart Omitted]
Plot points for Crest Fund Value Fund Trust Class are as follows:
Crest Funds Value Fund S&P 500 Compostite Index
Trust Class
9/30/92 1,000,000 1.000,000
Nov-92 1,142,600 1,037,616
Nov-93 1,147,381 1,142,415
Nov-94 1,141,759 1,154,182
Nov-95 1,470,129 1,564,598
Nov-96 1,803,554 1,996,598
Trust Class shares are available to qualified individual or institutional
customers whose assets are managed and/or administered by Crestar Bank's Trust &
Investment Management Group.
A hypothetical $1 million investment in Trust Class shares of the Value Fund,
at the Fund's commencement of operations (9/28/92), including the effect of Fund
expenses but excluding account level fees, would have grown to $1,803,554 by
November 30, 1996. Over the same period, a $1 million investment in Standard &
Poor's 500 Composite Index would have grown to $1,996,598.
INVESTORS CLASS B
Comparison of Change in the Value of a $10,000
Investment in the CrestFunds Value Fund,
Investor B Class, versus the Standard & Poor's 500 Composite Index
[Line Chart Omitted]
Plot points for Crest Fund Value Fund Investors Class B are as follows:
Crest Funds Value Fund S&P 500 Compostite Index
Investor Class B
4/30/95 10,000 10,000
Nov-95 11,423 11,915
Nov-96 13,714 15,205
Investors Class B shares are available to individual and institutional customers
investing directly in the Funds.
A hypothetical $10,000 investment in Investors Class B shares of the Value
Fund on the day that class commenced operations (4/5/95), including the effect
of a Contingent Deferred Sales Charge and the Investors Class B higher transfer
agency fee and 12B-1 fee, would be valued at $13,714 by November 30, 1996. Over
the same period, a $10,000 investment in Standard & Poor's 500 Composite Index
would have grown to $15,205.
INVESTORS CLASS A
Comparison of Change in the Value of a $10,000
Investment in the CrestFunds Value Fund,
Investor A Class, versus the Standard & Poor's 500 Composite Index
[Line Chart Omitted]
Plot points for Crest Fund Value Fund Investors Class A are as follows:
Crest Funds Value Fund S&P 500 Compostite Index
Investor Class A
5/31/93 9,550 10,000
Nov-93 9,642 10,401
Nov-94 9599 10508
Nov-95 12355 14245
Nov-96 15151 18178
Investors Class A shares are available to individual and institutional customers
investing directly in the Funds. A hypothetical $10,000 investment in
Investors Class A shares of the Value Fund on the day that class commenced
operations (5/7/93), including the effect of the maximum 4.50% sales charge and
the Investors Class A higher transfer agency fee, would be valued at $15,151 by
November 30, 1996. Over the same period, a $10,000 investment in Standard &
Poor's 500 Composite Index would have grown to $18,178.
<PAGE>
CRESTFUNDS, INC.: VALUE FUND
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
FOR THE PERIOD ENDED NOVEMBER 30, 1996
--------------------------------------
TRUST CLASS INVESTORS CLASS A INVESTORS CLASS B
----------- ----------------- -----------------
with load without load with without
back-end load back-end load
1 YEAR 22.68% 17.11% 22.63% 16.81% 21.81%
3 YEAR 16.27% 14.48% 16.26% -- --
LIFE OF FUND 15.44% 13.26% 14.73% 20.97% 23.09%
CUMULATIVE TOTAL RETURN
FOR THE PERIOD ENDED NOVEMBER 30, 1996
--------------------------------------
TRUST CLASS INVESTORS CLASS A INVESTORS CLASS B
----------- ----------------- -----------------
with load without load with without
back-end load back-end load
1 YEAR 22.68% 17.11% 22.63% 16.81% 21.81%
3 YEAR 57.19% 50.03% 57.13% -- --
LIFE OF FUND 82.16% 55.90% 63.25% 37.03% 41.03%
Total returns are historical and include changes in share price and reinvestment
of dividends and capital gain distributions, if any. Life of Fund figures are
from commencement of operations per class to the period ended listed above.
The S&P 500(R) Index is an unmanaged index of common stocks. It includes
reinvestment of dividends. Share price, yield and return will vary, and you may
have a gain or loss when you sell your shares. Past performance is no guarantee
of future results.
<PAGE>
CRESTFUNDS, INC.: CAPITAL APPRECIATION FUND
- --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE
The Capital Appreciation Fund seeks to provide long-term capital appreciation by
investing primarily in the equity securities of companies with medium to large
market capitalizations.
YEAR IN REVIEW
A DISCIPLINED EQUITY SELECTION APPROACH AND A FAVORABLE MARKET ENVIRONMENT
HELPED THE CAPITAL APPRECIATION FUND ENJOY PARTICULARLY STRONG PERFORMANCE OF
25.4% (TRUST CLASS) OVER THE LAST TWELVE MONTHS. The Fund's increased focus on
larger capitalization, more established growth companies late in 1995 proved
profitable as these stocks led the market this year. We expect larger
capitalization stocks to continue to perform well, but we are beginning to see
more attractive growth opportunities in stocks with medium market
capitalizations.
OUR FOCUS ON ESTABLISHED GROWTH COMPANIES THAT HAVE COMPETITIVE ADVANTAGES
WORKED WELL THIS YEAR -- SOME EXAMPLES BEING INTEL, MICROSOFT, AND COCA-COLA.
These types of companies typically enjoy above-average profitability as a result
of proprietary products, low cost production, and/or leading global market
positions. Intel, for instance, controls over 80% of the worldwide
microprocessor market and continues to develop industry- leading proprietary
products each year. A number of new product introductions (and lack of
competitive products) over the next twelve months boosts our confidence in the
earnings outlook for the company, thus making it one of our larger holdings.
Companies that have the capacity to deliver consistent growth, like those
described above, are core holdings in the Capital Appreciation Fund.
THE FUND ALSO HOLDS A NUMBER OF COMPANIES THAT
WE CLASSIFY AS HAVING EMERGING GROWTH CHARACTERISTICS. These companies tend to
be smaller and have above average growth rates. A good example of an emerging
growth company currently held in the Fund is Cascade Communications, a
manufacturer of high-speed telecommunication equipment that is well-positioned
to benefit from the explosive growth of worldwide telecommunication systems.
While these stocks tend to trade at valuation levels above that of the overall
market, their earnings growth rates offer a compensatory balance.
FROM A SECTOR PERSPECTIVE, WE CONTINUE TO FIND ATTRACTIVE STOCKS IN THE
TECHNOLOGY AND HEALTHCARE AREAS. These groups offer many growth opportunities
through market expansion and innovative new product developments. There are not
as many attractive opportunities in consumer-oriented areas (particularly food
and beverage stocks), as some of the stocks have relatively high valuations that
are not warranted considering the level of expected earnings growth.
WE BELIEVE IT IS MORE IMPORTANT THAN EVER TO FOCUS ON INDIVIDUAL EQUITY
SELECTION, NOT BROAD MARKET OR SECTOR forecasts. The strong performance of the
equity markets this year comes on the heels of near record results last year.
Using history as a guide, we should not expect broad equity market results to
continue at the same pace of the next twelve months. Our disciplined approach of
identifying companies that have solid growth prospects that are trading at
reasonable valuations should perform well in that environment.
FUND COMPOSITION (AS A PERCENTAGE OF TOTAL INVESTMENTS)
AS OF NOVEMBER 30, 1996
[Pie Chart Omitted]
Percentages for total Investments of Capital Appreciation Fund as as follows:
Basic Materials -- 3%
Capital Goods -- 13%
Consumer Cyclicals -- 15%
Consumer Non-Durables -- 30%
Energy -- 5%
Finance -- 9%
Technology -- 19%
Transportation -- 19%
Transportation -- 1%
Utilities -- 5%
<PAGE>
CRESTFUNDS, INC.: CAPITAL APPRECIATION FUND
- --------------------------------------------------------------------------------
PERFORMANCE
TRUST CLASS
Comparison of Change in the Value of a $1,000,000
Investment in the CrestFunds Capital Appreciation Fund,
Trust Class, versus the Frank Russell 1000 Growth Index
[LINE CHART OMITTED]
Plot points for CrestFunds Capital Appreciation Fund Trust Class are as follows:
CrestFunds Capital Appreciation fund Frank Russell 1000 Growth Index
Trust Class
1/31/93 1,000,000 1,000,000
Nov-93 963,643 1,023,182
Nov-94 1,003,345 1,051,012
Nov-95 1,211,439 1,457,754
Nov.-96 1,518,902 1,841,143
Trust Class shares are available to qualified individual or institutional
customers whose assets are managed and/or administered by Crestar Bank's Trust &
Investment Management Group.
A hypothetical $1 million investment in Trust Class shares of the Capital
Appreciation Fund, at the Fund's commencement of operations (1/11/93), including
the effect of Fund expenses but excluding account level fees, would have grown
to $1,518,902 by November 30, 1996. Over the same period, a $1 million
investment in Frank Russell 1000 Growth Index would have grown to $1,841,143.
INVESTORS CLASS A
Comparison of Change in the Value of a $10,000
Investment in the CrestFunds Capital Appreciation Fund,
Investor A Class, versus the Frank Russell 1000 Growth Index
[LINE CHART OMITTED]
Plot points for CrestFunds Capital Appreciation Fund Investor Class A are as
follows:
CrestFunds Capital Appreciation fund Frank Russell 1000 Growth Index
Investor Class A
5/31/93 9,550 10,000
Nov-93 9,512 10,265
Nov-94 9,863 10,544
Nov-95 11,906 14,625
Nov.-96 14,923 18,471
Investors Class A shares are available to individual and institutional customers
investing directly in the Funds.
A hypothetical $10,000 investment in Investors Class A shares of the
Capital Appreciation Fund on the day that class commenced operations (5/7/93),
including the effect of the maximum 4.50% sales charge and the Investors Class
A higher transfer agency fee, would be valued at $14,923 by November 30, 1996.
Over the same period, a $10,000 investment in Frank Russell Growth Index would
have grown to $18,471.
AVERAGE ANNUAL TOTAL RETURN
FOR THE PERIOD ENDED NOVEMBER 30, 1996
--------------------------------------
TRUST CLASS INVESTORS CLASS A
----------- -----------------
with load without load
1 YEAR 25.38% 19.67% 25.34%
3 YEAR 16.38% 14.43% 16.20%
LIFE OF FUND 11.84% 13.04% 14.49%
CUMULATIVE TOTAL RETURN
FOR THE PERIOD ENDED NOVEMBER 30, 1996
--------------------------------------
TRUST CLASS INVESTORS CLASS A
----------- -----------------
with load without load
1 YEAR 25.38% 19.67% 25.34%
3 YEAR 57.62% 49.83% 56.91%
LIFE OF FUND 54.47% 54.84% 62.06%
Total returns are historical and include changes in share price and reinvestment
of dividends and capital gain distributions, if any. Life of Fund figures are
from commencement of operations per class to the period ended listed above. The
Frank Russell 1000(R) Growth Index, an unmanaged index, is a broad measure of
the performance of growth companies. It includes reinvestment of dividends and
capital gains. Share price, yield and return will vary, and you may have a gain
or loss when you sell your shares. Past performance is no guarantee of future
results.
<PAGE>
CRESTFUNDS, INC.: SPECIAL EQUITY FUND
- --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE
The Special Equity Fund seeks to provide long-term capital appreciation by
investing primarily in the equity securities of companies with small to medium
market capitalization. These companies often pay no dividends, and current
income is not a goal of the Fund.
YEAR IN REVIEW
FOLLOWING A GREAT 1995, THE STOCK MARKET DELIVERED AN ENCORE PERFORMANCE DURING
THE 1996 FISCAL YEAR. While equities with large market capitalizations provided
the best performance, small and medium sized companies still managed to deliver
attractive, double-digit returns. Strong inflows into equity mutual funds and a
modestly growing economy continued to provide a benign environment for stocks.
In addition, merger and acquisition activity remained brisk this year in a
variety of economic sectors, as larger corporations sought to expand their
businesses through acquiring undervalued companies with solid top-line growth or
restructuring potential. On sector basis, the technology areas (fueled by strong
earnings growth) continued to provide some of the best performing equities this
year.
THE SPECIAL EQUITY FUND BENEFITED FROM THESE SAME FACTORS. For the fiscal
year ending November 30, 1996, the Trust Class shares produced a 16.4% total
return, similar to the Frank Russell 2000 index. Several holdings in the finance
and technology sectors contributed positively to the Fund's performance. As a
by-product of owning companies with attractive growth prospects and reasonable
valuation levels, a number of holdings in the Fund were acquired by larger
companies during year, including Medisense, Fist Colony and SQA Inc. Such
holdings generally had a positive impact on the Fund's return.
WE CONTINUE TO FIND AREAS IN THE SMALL CAPITALIZATION MARKET OFFERING
REASONABLE VALUE AND ATTRACTIVE LONG-TERM GROWTH PROSPECTS. In addition to these
basic characteristics, we have favored companies that have: 1) improving
business momentum and 2) the ability to expand margins by growing revenues
faster than expenses. For example, we have increased exposure to the
telecommunication equipment providers, potential beneficiaries of deregulation
and rising international demand. In addition, recent purchases have been made in
the software development tools industry, which should benefit from the growing
demand for more complex software applications. In the health service area, we
have added companies like American Home Patient, a solid growth candidate due to
the increasing demand for low cost health care solutions.
IN SOME OF THE MORE MATURE SECTORS OF THE MARKET, THE FUND HOLDS SEVERAL
INEXPENSIVE COMPANIES THAT ARE CREATING VALUE FOR SHAREHOLDERS BY COST CUTTING
AND AGGRESSIVE CAPITAL MANAGEMENT. Two recent examples are Zale in the retail
industry and Titan Wheel in the machinery areas. In addition, we favor the
outlook in the mortgage insurance and thrift industries, where we expect credit
costs to decline for companies with significant exposure to the western U.S.
region.
WHILE THE EQUITY MARKET ON THE WHOLE HAS MADE A HISTORICALLY ROBUST ADVANCE
OVER THE PAST TWO YEARS, SMALL CAPITALIZATION STOCKS HAVE TRAILED THE OVERALL
MARKET AND STILL OFFER ATTRACTIVE VALUE RELATIVE TO LARGE CAPITALIZATION STOCKS.
If small capitalization stocks close this valuation gap, the Fund should benefit
from its broad exposure to this segment of the equity market.
FUND COMPOSITION (AS A PERCENTAGE OF TOTAL INVESTMENTS)
AS OF NOVEMBER 30, 1996
[PIE CHART OMITTED]
Percentages for total Investments of Special Equity Fund are as follows
Basic Materials -- 7%
Capital Goods -- 14%
Consumer Cyclicals -- 15%
Consumer Non-Durables -- 19%
Energy -- 6%
Finance -- 15%
Technology -- 17%
Transportation -- 2%
Utilities -- 5%
<PAGE>
CRESTFUNDS, INC.: SPECIAL EQUITY FUND
- --------------------------------------------------------------------------------
PERFORMANCE
TRUST CLASS
Comparison of Change in the Value of a $1,000,000
Investment in the CrestFunds Special Equity Fund,
Trust Class, versus the Frank Russell 2000 Growth Index
and the Value Line Index (Price Return)
[LINE CHART OMITTED}
Plot points for Trust Class Are as follows
Crest Funds Special Equity Frank Russell 2000 Value Line Index
growth Index
9/30/92 1,000,000 1,000,000 1,000,000
Nov-92 1,110,106 1,138,235 1,054,329
Nov-93 1,266,290 1,275,392 1,161,027
Nov-94 1,206,276 1,263,658 1,112,031
Nov-95 1,448,375 1,658,046 1,331,546
Nov-96 1,686,488 1,849,550 1,523,689
Trust Class shares are available to qualified individual or institutional
customers whose assets are managed and/or administered by Crestar Bank's Trust &
Investment Management Group.
A hypothetical $1 million investment in Trust Class shares of the Special
Equity Fund, at the Fund's commencement of operations (9/28/92), including the
effect of Fund expenses but excluding account level fees, would have grown to
$1,686,488 by November 30, 1996. Over the same period, a $1 million investment
in Value Line Index and Frank Russell 2000 Growth Index would have grown to
$1,523,689 and $1,849,550, respectively.
INVESTORS CLASS B
Comparison of Change in the Value of a $10,000
Investment in the CrestFunds Special Equity Fund,
Investor B Class, versus the Frank Russell 2000 Growth Index,
and the Value Line Index
[LINE CHART OMITTED}
Plot points for investors Class B Are as follows
Crest Funds Special Equity Frank Russell 2000 Value Line Index
Growth Index
4/30/93 1,0000 1,0000 1,0000
Nov-95 11,128 11,972 11,038
Nov-96 12,650 13,355 12,631
Investors Class B shares are available to individual and institutional customers
investing directly in the Funds.
A hypothetical $10,000 investment in Investors Class B shares of the
Special Equity Fund on the day that class commenced operations (5/5/93),
including the effect of a Contingent Deferred sales charge and the Investors
Class B higher transfer agency fee and 12B-1 fee, would be valued at $12,650 by
November 30, 1996. Over the same period, a $10,000 investment in Value Line
Index and Frank Russell 2000 Growth Index would have grown to $12,631 and
$13,335, respectively.
INVESTORS CLASS A
Comparison of Change in the Value of a $10,000
Investment in the CrestFunds Special Equity Fund,
Investor A Class, versus the Frank Russell 2000 Growth Index,
and the Value Line Index (Price Return)
[LINE CHART OMITTED}
Plot points for investors Class A Are as follows
Crest Funds Special Equity Frank Russell 2000 Value Line Index
Growth Index
5/31/93 9,550 10,000 10,000
Nov-93 10,175 10,819 10,225
Nov-94 9,691 10,720 9,793
Nov-95 11,635 14,065 11,726
Nov-96 13,536 15,690 13,418
Investors Class A shares are available to individual and institutional customers
investing directly in the Funds.
A hypothetical $10,000 investment in Investors Class A shares of the
Special Equity Fund on the day that class commenced operations (5/5/93),
including the effect of the maximum 4.50% sales charge and the Investors Class
A higher transfer agency fee, would be valued at $13,536 by November 30, 1996.
Over the same period, a $10,000 investment in Value Line Index and Frank Russell
2000 Growth Index would have grown to $13,418 and 15,690, respectively.
<PAGE>
CRESTFUNDS, INC.: SPECIAL EQUITY FUND
- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
FOR THE PERIOD ENDED NOVEMBER 30, 1996
--------------------------------------
TRUST CLASS INVESTORS CLASS A INVESTORS CLASS B
----------- ----------------- -----------------
with load without load with without
back-end load back-end load
1 YEAR 16.44% 11.11% 16.34% 10.47% 15.47%
3 YEAR 10.02% 8.31% 9.98% -- --
LIFE OF FUND 13.53% 9.12% 10.54% 16.05% 18.24%
CUMULATIVE TOTAL RETURN
FOR THE PERIOD ENDED NOVEMBER 30, 1996
--------------------------------------
TRUST CLASS INVESTORS CLASS A INVESTORS CLASS B
----------- ----------------- -----------------
with load without load with without
back-end load back-end load
1 YEAR 16.44% 11.11% 16.34% 10.47% 15.47%
3 YEAR 33.17% 27.06% 33.03% -- --
LIFE OF FUND 69.99% 36.61% 43.06% 27.88% 31.88%
Total returns are historical and include changes in share price and reinvestment
of dividends and capital gain distributions, if any. Life of Fund figures are
from commencement of operations per class to the period ended listed above. The
Value Line Index, an unmanaged index, is a broad measure of the performance of
both large and small capital companies. The Frank Russell 2000 Growth Index, an
unmanaged index is a broad measure of the performance of both large and small
capital companies. Both include reinvestment of dividends and capital gains.
Share price, yield and return will vary, and you may have a gain or loss when
you sell your shares. Past performance is no guarantee of future results.
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- -------------------------------------------------------------------------------
CASH RESERVE FUND
Face
Amount Value
(000) (000)
------ ------
COMMERCIAL PAPER (12.1%)
AES Shady Point
5.470%, 01/07/97 .................. $15,000 $14,916
5.400%, 01/22/97 .................. 15,000 14,883
International Nederlanden
5.350%, 12/16/96 .................. 25,000 24,944
Minolta
5.420%, 01/08/97 .................. 5,000 4,971
Strategic Asset Funding
5.380%, 02/24/97 .................. 9,000 8,886
5.380%, 02/28/97 .................. 5,000 4,933
Walt Disney
5.250%, 07/25/97 .................. 10,000 9,656
- ---------------------------------------------------------
Total Commercial Paper
(Cost $83,189) ................ 83,189
- ---------------------------------------------------------
CERTIFICATES OF DEPOSIT (13.7%)
Bank of New York
5.930%, 09/03/97 .................. 5,000 4,992
Bank of Tokyo
5.860%, 05/09/97 .................. 10,000 10,001
6.000%, 06/05/97 .................. 10,000 10,000
First Alabama Bank
5.970%, 06/23/97 .................. 14,000 13,999
Sanwa Bank
5.460%, 03/19/97 .................. 20,000 20,001
5.620%, 03/24/97 .................. 10,000 10,001
Societe Generale
5.780%, 08/20/97 .................. 15,000 14,998
5.720%, 10/22/97 .................. 10,000 9,996
- ---------------------------------------------------------
Total Certificates of Deposit
(Cost $93,988) ................ 93,988
- ---------------------------------------------------------
CORPORATE OBLIGATIONS (23.5%)
Bear Stearns MTN
5.810%, 12/02/96 (A) .............. 20,000 20,038
5.472%, 12/06/96 (A) .............. 8,000 8,000
CS First Boston MTN
5.450%, 12/02/96 (A) .............. 28,000 28,000
General American Life GIC
5.580%, 12/01/96 (A) .............. 30,000 30,000
General Motors Acceptance MTN
7.750%, 04/15/97 .................. 5,000 5,033
7.750%, 05/12/97 .................. 5,000 5,038
7.000%, 06/02/97 .................. 8,000 8,038
6.125%, 06/09/97 .................. 5,000 4,999
7.000%, 08/15/97 .................. 5,000 5,028
IBM Credit MTN
5.780%, 08/20/97 .................. 10,000 9,991
Merrill Lynch MTN
5.460%, 12/02/96 (A) .............. 12,000 11,999
5.900%, 05/12/97 .................. 15,000 15,000
Philip Morris
9.250%, 12/01/97 .................. 10,000 10,346
- ---------------------------------------------------------
Total Corporate Obligations
(Cost $161,510) ............... 161,510
- ---------------------------------------------------------
Face
Amount Value
(000) (000)
------ ------
BANK NOTES (12.3%)
Banc One
7.800%, 12/30/96 .................. $ 9,000 $ 9,015
FCC National Bank
5.380%, 12/02/96 (A) .............. 15,000 14,993
5.500%, 03/14/97 .................. 10,000 9,998
First of America Bank
5.060%, 01/23/97 .................. 23,230 23,204
PNC Bank North America
5.390%, 12/02/96 (A) .............. 27,000 26,987
- ---------------------------------------------------------
Total Bank Notes
(Cost $84,197) ................ 84,197
- ---------------------------------------------------------
U.S. GOVERNMENT AGENCY OBLIGATIONS (15.9%)
FFCB
5.310%, 12/02/96 (A) .............. 25,000 24,986
FHLB
5.460%, 12/02/96 (A) .............. 25,000 25,008
FHLB
5.780%, 07/08/97 .................. 5,000 4,996
FNMA
5.850%, 12/02/96 (A) .............. 35,000 35,031
5.700%, 05/19/97 .................. 19,000 19,026
- ---------------------------------------------------------
Total U.S. Government Agency Obligations
(Cost $109,047) ............... 109,047
- ---------------------------------------------------------
REPURCHASE AGREEMENTS (22.0%)
Deutsche Bank
5.690%, dated
11/29/96, matures 12/02/96,
repurchase price $101,646,392
(collateralized by FHLMC
obligation par value
$75,000,000, 5.140%, 08/01/33;
FNMA obligation par value
$47,871,208, 7.500%, 11/25/25;
total market value: $103,630,182) .. 101,598 101,598
J.P. Morgan
5.690%, dated 11/29/96,
matures 12/02/96, repurchase
price $32,120,084 (collateralized
by various GNMA obligations
total par value $31,744,262,
5.500%-8.000%, 06/15/26-11/20/26;
total market value: $32,757,916) ... 32,105 32,105
Swiss Bank
5.690%, dated 11/29/96,
matures 12/02/96, repurchase
price $17,532,913 (collateralized
by FHLMC obligation par value
$18,021,000, 7.000%, 11/01/26;
total market value: $17,972,694) ... 17,525 17,525
- ----------------------------------------------------------
Total Repurchase Agreements
(Cost $151,228) ............... 151,228
- ----------------------------------------------------------
Total Investments (99.5%)
(Cost $683,159) ............... $683,159
- ----------------------------------------------------------
OTHER ASSETS AND LIABILITIES, NET (0.5%) 3,406
- ----------------------------------------------------------
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
CASH RESERVE FUND (concluded)
Value
(000)
------
NET ASSETS:
Portfolio Shares of Trust Class
($.001 par value -- 4.0 billion shares
authorized) based on 621,166,838 outstanding
shares ..................................... $621,167
Portfolio Shares of Investor Class A
($.001 par value -- .25 billion
shares authorized) based on
65,411,676 outstanding shares .............. 65,412
Portfolio Shares of Investor Class B
($.001 par value -- .25 billion shares
authorized) based on 15,137
outstanding shares ......................... 15
Undistributed net investment income........... 50
Accumulated net realized loss
on investments ............................. (79)
- ---------------------------------------------------------
Total Net Assets: (100.0%).................... $686,565
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- TRUST CLASS
(621,138,797 DIVIDE 621,166,838
SHARES OUTSTANDING)............................ $1.00
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- INVESTOR CLASS A
(65,410,774 DIVIDE 65,411,676 SHARES
OUTSTANDING)................................... $1.00
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- INVESTOR CLASS B (1)
(15,127 DIVIDE 15,137 SHARES OUTSTANDING)...... $1.00
=========================================================
(A) Floating Rate Security--the rate reflected on the Statement of Net Assets is
the rate in effect on November 30, 1996. The date reported on the
Statement of Net Assets is the later of the date on which the security can
be redeemed at par or the next date on which the rate of interest is
adjusted.
(1) Investor B has a contingent deferred sales charge. For description of
a possible redemption charge, see the notes to the financial statements.
FFCB--Federal Farm Credit Bank
FHLB--Federal Home Loan Bank
FHLMC--Federal Home Loan Mortgage Corporation
FNMA--Federal National Mortgage Association
GIC--Guaranteed Investment Contract
GNMA--Government National Mortgage Association
MTN--Medium Term Note
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
U.S. TREASURY MONEY FUND
Face
Amount Value
(000) (000)
------ ------
U.S. TREASURY OBLIGATIONS (25.3%)
U.S. Treasury Bills
5.405%, 01/09/97 .......................... $10,000 $ 9,943
5.300%, 03/06/97 .......................... 15,000 14,798
5.420%, 03/06/97 .......................... 10,000 9,863
5.310%, 04/17/97 .......................... 10,000 9,806
5.319%, 06/26/97 .......................... 5,000 4,853
5.930%, 08/21/97 .......................... 5,000 4,795
5.602%, 09/18/97 .......................... 5,000 4,785
5.350%, 10/16/97 .......................... 5,000 4,775
5.410%, 11/13/97 .......................... 5,000 4,753
U.S. Treasury Note
6.500%, 05/15/97 .......................... 20,000 20,064
U.S. Treasury STRIPS
0.000%, 02/15/97 .......................... 10,000 9,898
- -------------------------------------------------------------------
Total U.S. Treasury Obligations
(Cost $98,333) ........................ 98,333
- -------------------------------------------------------------------
REPURCHASE AGREEMENTS (75.1%)
Deutsche Bank
5.620%, dated 11/29/96, matures
12/02/96, repurchase price $94,581,967
(collateralized by various U.S. Treasury
obligations total par value $79,045,000,
7.750%-12.500%, 11/30/99-08/15/14;
total market value: $96,429,048) .......... 94,538 94,538
J.P. Morgan
5.620%, dated 11/29/96, matures
12/02/96, repurchase price $18,968,446
(collateralized by various U.S. Treasury
obligations total par value $15,282,375,
0.000%-11.250%, 02/15/98-02/15/25;
total market value: $19,341,898) .......... 18,960 18,960
Lehman Brothers
5.620%, dated 11/29/96, matures
12/02/96, repurchase price $18,746,831
(collateralized by U.S. Treasury
obligation par value $39,310,000,
0.000%, 05/15/08; total market
value: $19,114,488) ....................... 18,738 18,738
Merrill Lynch
5.620%, dated 11/29/96, matures
12/02/96, repurchase price $14,593,621
(collateralized by U.S. Treasury obligation
par value $11,125,000, 10.750%, 08/15/05;
total market value: $14,879,963) ........... 14,587 14,587
Morgan Stanley
5.620%, dated 11/29/96, matures
12/02/96, repurchase price $16,588,847
(collateralized by U.S. Treasury obligation
par value $16,040,000, 7.875%, 01/15/98;
total market value: $16,921,049) .......... 16,581 16,581
Face
Amount Value
(000) (000)
------ ------
Nomura Securities
5.620%, dated 11/29/96, matures
12/02/96, repurchase price $94,087,269
(collateralized by various U.S. Treasury
obligations total par value $376,725,000,
0.000%, 05/15/17-08/15/17; total market
value: $95,924,108) , ..................... $94,043 $ 94,043
Prudential Bache
5.620%, dated 11/29/96, matures
12/02/96, repurchase price $15,703,756
(collateralized by various U.S. Treasury
obligations total par value $18,281,000,
0.000%-7.250%, 07/31/97-05/15/05;
total market value: $16,011,299) .......... 15,696 15,696
Swiss Bank
5.620%, dated 11/29/96, matures
12/02/96, repurchase price $19,014,435
(collateralized by various U.S. Treasury
obligations total par value $19,007,000,
6.000%-7.375%, 08/31/97-11/15/97; total
market value: $19,389,449) ................ 19,006 19,006
- -------------------------------------------------------------------
Total Repurchase Agreements
(Cost $292,149) ....................... 292,149
- -------------------------------------------------------------------
Total Investments (100.4%)
(Cost $390,482) ....................... 390,482
- -------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES, NET (-0.4%) .... (1,431)
- -------------------------------------------------------------------
NET ASSETS:
Portfolio Shares of Trust Class ($.001 par
value -- 3.75 billion shares authorized)
based on 389,050,574 outstanding shares .... 389,051
- -------------------------------------------------------------------
Total Net Assets: (100.0%) .............. $389,051
- -------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- TRUST CLASS
($389,050,576 DIVIDE 389,050,574
SHARES OUTSTANDING) .......................... $1.00
- -------------------------------------------------------------------
FHLMC--Federal Home Loan Mortgage Corporation
STRIPS--Separate Trading of Registered Interest and Principal Securities
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
TAX-FREE MONEY FUND
Face
Amount Value
(000) (000)
------ ------
MUNICIPAL BONDS (98.8%)
ARIZONA (4.0%)
Maricopa County, AZ, Ser C, GO,
Prerefunded 07/01/97 @ 101
6.625%, 07/01/01 (B) ...................... $7,220 $ 7,410
- -------------------------------------------------------------------
COLORADO (1.0%)
Arapahoe County, CO, CSX Beckett
Aviation Project, Ser 83
3.660%, 12/16/96 (A) (B) .................. 1,900 1,900
- -------------------------------------------------------------------
FLORIDA (2.6%)
Gainesville, FL, Utilities System Improvements,
Ser A, RB, Prerefunded 10/01/97
@ 102
7.000%, 10/01/98 .......................... 1,000 1,046
Manatee County, FL, Multi-Family
Housing Authority Hampton
Project, RB
3.600%, 12/04/96 (A) (B) .................. 3,850 3,850
- -------------------------------------------------------------------
4,896
- -------------------------------------------------------------------
GEORGIA (7.9%)
Cobb County, GA, Rhodes Home
Project, RB
3.550%, 12/04/96 (A) (B) .................. 2,125 2,125
Fulco County, GA, TECP
3.400%, 12/09/96 (B) ...................... 5,200 5,200
Georgia State, Ser D, GO
7.400%, 08/01/97 .......................... 2,065 2,114
Marietta, GA Multifamily Housing
Authority Falls At Bells Ferry Project,
RB, Mandatory Put 01/15/97 @ 100
3.550%, 01/15/09 (B) ...................... 5,100 5,100
- -------------------------------------------------------------------
14,539
- -------------------------------------------------------------------
INDIANA (2.0%)
Fort Wayne, IN, Parkview Memorial
Hospital Project, Ser B, RB
3.450%, 12/05/96 (A) (B) .................. 3,700 3,700
- -------------------------------------------------------------------
LOUISIANA (5.7%)
Jefferson Parish, LA, Hospital Service
District Number 2, RB, FGIC
3.500%, 12/04/96 (A) ...................... 6,000 6,000
Jefferson Parish, LA, School Board,
RB, AMBAC
5.000%, 02/01/97 .......................... 1,010 1,012
Louisiana State Refunding Bond, Ser A,
GO, AMBAC, Prerefunded 08/01/97 @ 102
7.000%, 08/01/02 (B) ...................... 1,465 1,524
Louisiana State, Public Facilities
Authority Willis Knighton Medical
Project, RB, AMBAC
3.500%, 12/04/96 (A) ...................... 2,100 2,100
- -------------------------------------------------------------------
10,636
- -------------------------------------------------------------------
Face
Amount Value
(000) (000)
------ ------
MARYLAND (13.0%)
Baltimore County, MD, TECP
3.300%, 12/04/96 .......................... $3,000 $ 3,000
3.500%, 03/04/97 .......................... 4,000 4,000
Maryland State Department of
Transportation, RB
6.600%, 07/01/97 .......................... 2,000 2,033
Maryland State Health & Higher
Educational Facilities Authority
Loyola College Issue, RB
3.550%, 12/02/96 (A)(B) ................... 7,000 7,000
Montgomery County, MD, TECP
3.500%, 02/03/97 (B) ...................... 5,000 5,000
3.500%, 03/04/97 (B) ...................... 3,000 3,000
- -------------------------------------------------------------------
24,033
- -------------------------------------------------------------------
MASSACHUSETTS (2.8%)
Massachusetts Municipal Wholesale
Electric Company, RB, Prerefunded
07/01/97 @ 102
8.750%, 07/01/18 (B) ...................... 5,000 5,242
- -------------------------------------------------------------------
NEVADA (1.1%)
Washoe County, NV School District
Improvements, GO, Prerefunded
08/01/97 @ 102
7.750%, 08/01/06 .......................... 2,000 2,092
- -------------------------------------------------------------------
NEW JERSEY (0.6%)
Jersey City, NJ, GO, AMBAC,
Prerefunded 10/01/97 @ 102
7.500%, 10/01/01 .......................... 1,000 1,050
- -------------------------------------------------------------------
NEW MEXICO (1.9%)
Los Alamos County, NM, RB,
Prerefunded 01/01/97 @ 102
7.750%, 01/01/15 (B) ...................... 3,480 3,562
- -------------------------------------------------------------------
NORTH CAROLINA (2.2%)
North Carolina State Medical Care
Community Hospital Project,
Ser A, RB
3.600%, 12/04/96 (A) (B) .................. 4,000 4,000
- -------------------------------------------------------------------
SOUTH CAROLINA (4.4%)
Florence County, SC, McLeod
Regional Medical Center Project,
Ser A, RB, FGIC
3.550%, 12/05/96 (A) ...................... 8,200 8,200
- -------------------------------------------------------------------
SOUTH DAKOTA (2.8%)
South Dakota State, Heartland
Consumers Power District Project,
RB, MBIA, Prerefunded 01/01/97 @102
7.625%, 01/01/16 .......................... 5,000 5,118
- -------------------------------------------------------------------
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
TAX-FREE MONEY FUND (continued)
Face
Amount Value
(000) (000)
------ ------
TENNESSEE (4.0%)
Franklin County, TN, Health &
Educational Facilities Authority
University of the South Project, RB
3.550%, 12/04/96 (A) (B) ................... $6,400 $ 6,400
Metropolitan Government Nashville &
Davidson County, TN, Electric Refunding
Bond, Ser A, RB, Prerefunded
07/01/97 @ 102
6.900%, 07/01/99 (B) ....................... 1,000 1,038
- -------------------------------------------------------------------
7,438
- -------------------------------------------------------------------
TEXAS (4.1%)
Harris County, TX, Highway Revenue
Tolls Project, Ser B, RB, Prerefunded
08/15/97 @ 102
6.625%, 08/15/11 (B) ....................... 2,520 2,618
Plano, TX, TECP, MBIA
3.500%, 12/05/96 ........................... 5,000 5,000
- -------------------------------------------------------------------
7,618
- -------------------------------------------------------------------
VIRGINIA (38.7%)
Alexandria, VA, Redevelopment Housing
Authority Multifamily First Mortgage
Goodwin Project, Ser B, RB
4.250%, 12/02/96 (A) (B) ................... 8,100 8,100
Chesterfield County, VA, Industrial
Development Authority Philip Morris
Companies Project, RB
3.550%, 12/04/96 (A) (B) ................... 5,500 5,500
Colonial Heights, VA, Industrial
Development Authority Philip Morris
Companies Project, RB
3.550%, 12/04/96 (A) (B) ................... 2,600 2,600
Fairfax County, VA, Public
Improvements Project, GO
6.850%, 04/01/97 ........................... 1,925 1,945
Fauquier County, VA, Industrial
Development Authority Carter
Machinery Project, RB
3.550%, 12/04/96 (A) (B) ................... 1,336 1,336
Greensville County, VA, Industrial
Development Authority Georgia
Pacific Project, RB
3.550%, 12/04/96 (A) (B) ................... 3,850 3,850
Hanover County, VA, Industrial
Development Authority Carter
Machinery Project, RB
3.550%, 12/04/96 (A) (B) ................... 500 500
Louisa County, VA, Industrial
Development Authority, RB 2
3.550%, 12/05/96 (A) (B) ................... 5,000 5,000
Newport News, VA Public Housing
Authority
3.550%, 12/04/96 (A) (B) ................... 1,051 1,051
Face
Amount Value
(000) (000)
------ ------
Norfolk, VA, Water Utilities
Improvements, GO, Prerefunded
06/01/97 @ 102
6.600%, 06/01/00 (B) ....................... $2,000 $ 2,067
Norfolk, VA, Water Utilities
Improvements, GO, Prerefunded
06/01/97 @ 102
6.600%, 06/01/02 ........................... 1,000 1,034
Prince William County, VA, Electric
& Power Project, RB, Mandatory
Put 01/07/97 @ 100
3.800%, 08/01/16 (B) ....................... 2,800 2,800
Pulaski County, VA, Industrial
Development Authority Pulaski
Furniture, RB
3.550%, 12/04/96 (A) (B) ................... 4,219 4,219
Richmond, VA, Industrial Development
Authority Philip Morris Companies
Project, RB
3.550%, 12/04/96 (A) (B) ................... 1,700 1,700
Richmond, VA, Public Housing
Authority Old Manchester Project,
Ser A, RB
3.650%, 12/04/96 (A) (B) ................... 6,000 6,000
Richmond, VA, Redevelopment
Housing Authority Stony Point
Project, RB
3.600%, 12/05/96 (A) (B) ................... 1,800 1,800
Roanoke County, VA, Industrial
Development Authority Roanoke
Memorial Hospital Project, Ser C, RB
3.600%, 12/04/96 (A) (B) ................... 3,300 3,300
Roanoke County, VA, Industrial
Development Authority Roanoke
Memorial Hospital Project, Ser D, RB
3.600%, 12/05/96 (A) (B) ................... 4,350 4,350
Rockingham County, VA, Higher
Educational Institutions, Eastern
Mennonite University, RB
3.600%, 12/04/96 (A) (B) ................... 2,500 2,500
Virginia Beach, VA, Industrial
Development Authority Fountainhead
Project, RB
3.550%, 12/04/96 (A) (B) ................... 2,939 2,939
Virginia State Public School
Improvements Project, RB
6.750%, 01/01/97 ........................... 1,320 1,324
York County, VA, Industrial Development
Authority Philip Morris Companies
Project, RB
3.550%, 12/04/96 (A) (B) ................... 2,700 2,700
York County, VA, Industrial Development
Authority Electric & Power Comany
Project, RB, Mandatory
Put 01/15/97 @ 100
3.850%, 07/01/09 (B) ....................... 5,000 5,000
- -------------------------------------------------------------------
71,615
- -------------------------------------------------------------------
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
TAX-FREE MONEY FUND (concluded)
Face
Amount Value
(000) (000)
------ ------
Total Municipal Bonds
(Cost $183,049) ........................ $183,049
- -------------------------------------------------------------------
CASH EQUIVALENTS (0.6%)
Financial Square Tax Free Portfolio ........... $688 688
SEI Institutional Tax Free Portfolio .......... 464 464
- -------------------------------------------------------------------
Total Cash Equivalents
(Cost $1,152) .......................... 1,152
- -------------------------------------------------------------------
Total Investments (99.4%)
(Cost $184,201) ........................ 184,201
- -------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES, NET (0.6%) ...... 1,113
- -------------------------------------------------------------------
NET ASSETS:
Portfolio Shares of Trust Class
($.001 par value -- .9 billion shares
authorized) based on
182,322,057 outstanding shares .............. 182,322
Portfolio Shares of Investor Class A
($.001 par value -- .1 billion shares
authorized) based on 2,994,332
outstanding shares .......................... 2,994
Accumulated net realized loss
on investments .............................. (2)
- -------------------------------------------------------------------
Total Net Assets: (100.0%) ............... $185,314
- -------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- TRUST CLASS
($182,320,295 DIVIDE 182,322,057
SHARES OUTSTANDING) ........................... $1.00
- -------------------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- INVESTOR CLASS A
($2,994,194 DIVIDE 2,994,332
SHARES OUTSTANDING) ........................... $1.00
===================================================================
(A) Floating Rate Security--the rate reflected on the Statement of Net Assets is
the rate in effect on November 30, 1996. The date reported on the Statement
of Net Assets is the later of the date on which the security can be redeemed
at par or the next date on which the rate of interest is adjusted.
(B) Security backed by letter of credit or credit support.
AMBAC--American Municipal Bond Assurance Corporation
FGIC--Financial Guaranty Investors Assurance
GO--General Obligation
MBIA--Municipal Bond Insurance Association
RB--Revenue Bond
Ser--Series
TECP--Tax Exempt Commercial Paper
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
LIMITED TERM BOND FUND
Face Market
Amount Value
(000) (000)
------ ------
U.S. TREASURY OBLIGATIONS (21.1%)
U.S. Treasury Notes
6.000%, 12/31/97 ................. $2,000 $ 2,011
7.250%, 02/15/98 ................. 1,000 1,020
6.000%, 05/31/98 ................. 3,000 3,020
6.250%, 06/30/98 ................. 2,000 2,022
6.375%, 01/15/99 ................. 1,000 1,016
5.875%, 03/31/99 ................. 1,000 1,005
7.000%, 04/15/99 ................. 1,000 1,029
6.000%, 10/15/99 ................. 2,000 2,019
5.500%, 12/31/00 ................. 2,000 1,978
6.375%, 08/15/02 ................. 1,000 1,024
5.750%, 08/15/03 ................. 2,000 1,979
- ---------------------------------------------------------
Total U.S. Treasury Obligations
(Cost $18,053) ............... 18,123
- ---------------------------------------------------------
U.S.GOVERNMENT AGENCY OBLIGATIONS (11.8%)
FFCB MTN
7.125%, 06/01/01 ................. 1,000 1,044
8.600%, 05/30/06 ................. 1,000 1,077
FHLB
5.870%, 06/26/98 ................. 2,000 2,005
FHLMC
5.980%, 12/08/05 ................. 1,000 980
FNMA MTN
6.610%, 03/24/99 ................. 1,750 1,785
6.310%, 11/02/00 ................. 500 502
6.250%, 01/14/04,
Callable 01/14/97 @ 100 ....... 1,000 980
6.770%, 09/01/05 ................. 1,750 1,806
- ---------------------------------------------------------
Total U.S.Government Agency Obligations
(Cost $10,138) ............... 10,179
- ---------------------------------------------------------
MORTGAGE-BACKED SECURITIES (14.4%)
FHLMC Pool D71261
7.500%, 05/01/26 ................. 1,955 1,981
FHLMC Pool E00412
7.000%, 01/01/11 ................. 1,825 1,841
FNMA ARM Pool 305168
7.686%, 12/01/96 (A) ............. 970 1,004
FNMA Pool 356039
6.500%, 08/01/03 ................. 2,985 2,981
FNMA REMIC 92-199A
5.250%, 11/25/99 ................. 874 862
FNMA TBA
7.000%, 12/11/26 ................. 2,500 2,477
GNMA Pool 207206
9.750%, 03/15/99 ................. 43 46
GNMA Pool 433176
8.000%, 08/15/26 ................. 997 1,028
Resolution Trust Corporation CMO
7.000%, 02/15/04 ................. 171 172
- ---------------------------------------------------------
Total Mortgage-Backed Securities
(Cost $12,225) ............... 12,392
- ---------------------------------------------------------
Face Market
Amount Value
(000) (000)
------ ------
CORPORATE OBLIGATIONS (32.3%)
Alcan Aluminum
5.875%, 04/01/00 ................. $2,000 $ 1,985
Allstate
5.875%, 06/15/98 ................. 1,000 1,000
American Home Products
6.875%, 04/15/97 ................. 1,000 1,005
Associates of North America
6.000%, 03/15/99 ................. 1,000 1,003
AT&T Capital
5.125%, 02/21/97 ................. 400 400
Capital One Bank MTN
6.830%, 05/17/99 ................. 2,000 2,023
Caterpillar Financial Services MTN
6.255%, 12/09/96 (A) ............. 2,000 1,995
Chrysler Financial
5.875%, 02/07/01 ................. 3,000 2,959
Commercial Credit
7.375%, 03/15/02 ................. 500 525
Connecticut Light & Power
5.500%, 02/01/99 ................. 1,000 985
Detroit Edison
6.400%, 10/01/98 ................. 975 975
General Electric
6.835%, 04/03/97 ................. 1,000 1,005
General Motors Acceptance
7.750%, 01/15/99 ................. 1,500 1,553
Houston Lighting & Power
5.250%, 01/01/97 ................. 1,000 1,000
IBM MTN
6.375%, 06/15/00 ................. 2,000 2,018
Philip Morris
9.250%, 12/01/97 ................. 1,000 1,034
6.375%, 01/15/98 ................. 2,000 2,013
Pitney Bowes Credit
6.250%, 06/01/98 ................. 1,000 1,006
Salomon Brothers
7.125%, 08/01/99 ................. 1,300 1,324
USL Capital
6.500%, 12/01/03 ................. 2,000 2,015
- ---------------------------------------------------------
Total Corporate Obligations
(Cost $27,713) ............... 27,823
- ---------------------------------------------------------
ASSET BACKED SECURITIES (17.4%)
Advanta Credit Card Master Trust,
Ser 1995-F A1
6.050%, 08/01/03 ................. 1,000 1,000
American Express Master Trust,
Ser 1992-2A
6.600%, 05/15/00 ................. 2,000 2,032
Chase Manhattan Grantor Trust,
Ser 1995-B
5.900%, 11/15/01 ................. 1,226 1,228
CIT RV Grantor Trust, Ser 1994-A, Cl A
4.900%, 07/15/09 ................. 955 937
CoreStates Home Equity Trust, Ser 1994-1A
6.650%, 05/15/09 ................. 714 714
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
LIMITED TERM BOND FUND (concluded)
Face Market
Amount Value
(000) (000)
------ ------
EQCC Home Equity Loan Trust,
Ser 1994-1 A
5.800%, 03/15/09 ................. $1,118 $ 1,084
Equivantage, Ser 1996-1 A1
6.550%, 10/25/25 ................. 1,632 1,622
Ford Credit Auto Owner Trust,
Ser 1996-A A2
6.300%, 12/15/98 ................. 2,000 2,012
Greentree Manufacturing Housing,
Ser 1995-7 A2
6.150%, 11/15/26 ................. 1,000 1,001
Premier Auto Trust, Ser 1993-5 A2
4.220%, 03/02/99 ................. 428 424
Spiegel Master Trust, Ser 1995-A
7.500%, 09/15/04 ................. 1,000 1,041
The Money Store Home Equity Trust,
Ser 1995-A1
7.925%, 02/15/14 ................. 1,846 1,883
Volvo Auto Receivables Grantor Trust,
Ser 1992-B, Cl A
5.450%, 12/15/98 ................. 36 36
- ---------------------------------------------------------
Total Asset Backed Securities
(Cost $14,908) ............... 15,014
- ---------------------------------------------------------
CASH EQUIVALENT (1.3%)
Aim Liquid Assets Portfolio ......... 1,131 1,131
- ---------------------------------------------------------
Total Cash Equivalent
(Cost $1,131) ................ 1,131
- ---------------------------------------------------------
Total Investments (98.3%)
(Cost $84,168) ............... 84,662
- ---------------------------------------------------------
OTHER ASSETS AND LIABILITIES, NET (1.7%) 1,433
- ---------------------------------------------------------
NET ASSETS:
Portfolio Shares of Trust Class
($.001 par value -- 1.4 billion shares
authorized) based on
8,558,773 outstanding shares ...... 86,045
Portfolio Shares of Investor Class A
($.001 par value -- .1 billion shares
authorized) based on 112,691
outstanding shares ................ 1,151
Accumulated net realized loss
on investments .................... (1,595)
Net unrealized appreciation
on investments .................... 494
- ---------------------------------------------------------
Total Net Assets: (100.0%) ..... $86,095
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- TRUST CLASS
($84,973,419 DIVIDE 8,558,773
SHARES OUTSTANDING) ................. $9.93
- ---------------------------------------------------------
Market
Value
(000)
------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- INVESTOR CLASS A
($1,121,727 DIVIDE 112,691
SHARES OUTSTANDING) ................. $9.95
- ---------------------------------------------------------
OFFERING PRICE PER SHARE-- INVESTOR CLASS A
($9.95 DIVIDE 98.0%) ..................... $10.15
=========================================================
(A) Floating Rate Security--the rate reflected on the Statement of Net Assets is
the rate in effect on November 30, 1996. The date reported on the Statement
of Net Assets is the later of the date on which the security can be redeemed
at par or the next date on which the rate of interest is adjusted.
ARM--Adjustable Rate Mortgage
Cl--Class
CMO--Collateralized Mortgage Obligation
FFCB--Federal Farm Credit Bank
FHLB--Federal Home Loan Bank
FHLMC--Federal Home Loan Mortgage Corporation
FNMA--Federal National Mortgage Association
GNMA--Government National Mortgage Association
MTN--Medium Term Note
REMIC--Real Estate Mortgage Investment Conduit
Ser--Series
TBA--To Be Announced
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
INTERMEDIATE BOND FUND
Face Market
Amount Value
(000) (000)
------ ------
U.S. TREASURY OBLIGATIONS (32.7%)
U.S. Treasury Bonds
10.000%, 05/15/10 ................. $2,000 $ 2,503
8.000%, 11/15/21 ................. 5,000 5,924
7.125%, 02/15/23 ................. 2,000 2,157
6.250%, 08/15/23 ................. 5,000 4,845
U.S. Treasury Notes
7.875%, 01/15/98 ................. 4,000 4,104
5.125%, 03/31/98 ................. 3,000 2,986
6.250%, 06/30/98 ................. 3,000 3,032
8.250%, 07/15/98 ................. 2,500 2,603
5.875%, 08/15/98 ................. 3,000 3,014
6.375%, 01/15/99 ................. 3,000 3,047
5.000%, 02/15/99 ................. 1,000 987
6.875%, 07/31/99 ................. 2,000 2,057
8.000%, 08/15/99 ................. 3,700 3,911
7.875%, 11/15/99 ................. 1,000 1,058
5.500%, 04/15/00 ................. 2,000 1,986
6.125%, 07/31/00 ................. 2,000 2,023
6.250%, 08/31/00 ................. 6,000 6,093
5.500%, 12/31/00 ................. 3,000 2,966
8.000%, 05/15/01 ................. 2,000 2,170
7.875%, 08/15/01 ................. 1,000 1,083
7.500%, 11/15/01 ................. 2,000 2,141
6.375%, 08/15/02 ................. 4,500 4,610
5.750%, 08/15/03 ................. 3,000 2,968
7.250%, 05/15/04 ................. 5,000 5,377
7.875%, 11/15/04 ................. 5,200 5,802
7.500%, 02/15/05 ................. 5,000 5,469
6.500%, 05/15/05 ................. 4,650 4,790
5.625%, 02/15/06 ................. 3,000 2,910
- ---------------------------------------------------------
Total U.S. Treasury Obligations
(Cost $89,353) ............... 92,616
- ---------------------------------------------------------
U.S. GOVERNMENT AGENCY OBLIGATIONS (6.4%)
FFCB MTN
7.125%, 06/01/01 ................. 2,500 2,609
8.600%, 05/30/06,
Callable 05/30/01 @ 100 ....... 1,000 1,077
FHLB
6.184%, 01/18/97 (A) ............. 1,000 1,001
FHLMC
5.980%, 12/08/05 ................. 1,000 980
FNMA
8.350%, 11/10/99 ................. 1,000 1,067
6.380%, 06/25/03 ................. 5,000 4,975
FNMA MTN
6.250%, 01/14/04,
Callable 01/14/97 @ 100 ....... 3,300 3,234
6.770%, 09/01/05 .................. 3,000 3,096
- ---------------------------------------------------------
Total U.S. Government Agency Obligations
(Cost $18,057) ............... 18,039
- ---------------------------------------------------------
Face Market
Amount Value
(000) (000)
------ ------
MORTGAGE-BACKED SECURITIES (16.2%)
FHLMC Pool D71261
7.500%, 05/01/26 ................. $ 6,843 $ 6,935
FHLMC Pool E00412
7.000%, 01/01/11 ................. 1,825 1,841
FHLMC REMIC 1726B
6.750%, 11/15/04 ................. 7,000 7,080
FNMA Pool 356039
6.500%, 08/01/03 ................. 3,035 3,031
FNMA REMIC 91-01 1G
7.000%, 01/25/21 ................. 1,500 1,494
FNMA TBA
7.000%, 12/11/26 ................. 10,000 9,906
GNMA Pool 207206
9.750%, 03/15/99 ................. 70 75
GNMA Pool 376345
6.500%, 12/15/23 ................. 8,048 7,824
GNMA Pool 433176
8.000%, 08/15/26 ................. 7,493 7,725
Resolution Trust Corporation CMO
7.000%, 02/15/04 ................. 137 138
- ---------------------------------------------------------
Total Mortgage-Backed Securities
(Cost $45,079) ............... 46,049
- ---------------------------------------------------------
CORPORATE OBLIGATIONS (33.8%)
Allstate
5.875%, 06/15/98 ................. 1,000 1,000
Associates of North America
6.000%, 03/15/99 ................. 1,000 1,003
AT&T
7.000%, 05/15/05 ................. 1,000 1,034
AT&T MTN
5.520%, 01/26/97 (A) ............. 1,000 995
Bank of New York
7.625%, 07/15/02 ................. 1,000 1,061
BankAmerica
7.500%, 10/15/02 ................. 1,000 1,058
6.875%, 06/01/03 ................. 5,000 5,113
Capital One Bank MTN
6.830%, 05/17/99 ................. 2,000 2,023
Caterpillar Financial Services MTN
6.255%, 12/09/96 (A) ............. 2,000 1,995
Central Fidelity
8.150%, 11/15/02 ................. 3,000 3,251
Chrysler Financial Corp.
5.625%, 01/15/99 ................. 1,000 994
Citicorp
6.750%, 08/15/05 ................. 6,000 6,038
First Chicago
7.625%, 01/15/03 ................. 1,000 1,058
First Fidelity
8.500%, 04/01/98 ................. 2,000 2,070
Ford Motor
7.500%, 11/15/99 ................. 1,000 1,039
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
INTERMEDIATE BOND FUND (continued)
Face Market
Amount Value
(000) (000)
------ ------
CORPORATE OBLIGATIONS (continued)
Ford Motor Credit
6.750%, 05/15/05 ................. $6,000 $ 6,015
General Motors Acceptance
8.500%, 01/01/03 ................. 1,000 1,101
General Motors Acceptance MTN
7.000%, 03/01/00 ................. 1,000 1,023
General Motors
7.000%, 06/15/03 ................. 6,000 6,203
General Telephone of Michigan
7.500%, 11/01/01 ................. 1,000 1,011
Gulf States Utilities
6.770%, 08/01/05 ................. 5,000 4,838
IBM
6.375%, 06/15/00 ................. 2,000 2,018
Illinois Bell Telephone
5.800%, 02/01/04 ................. 1,000 964
International Bank Reconstruction
& Development
0.000%, 02/15/08 ................. 2,000 960
International Bank Reconstruction &
Development MTN
9.100%, 06/01/99 ................. 1,500 1,616
Joseph E. Seagram and Sons
7.000%, 04/15/08 ................. 5,000 5,131
KeyCorp
8.000%, 07/01/04 ................. 1,000 1,080
KMart
8.125%, 12/01/06 ................. 5,000 4,613
Lehman Brothers
10.000%, 05/15/99 ................ 3,000 3,248
Loews
8.250%, 01/15/07 ................. 1,000 1,038
Marriott International
7.125%, 06/01/07 ................. 1,750 1,765
Mellon Bank
6.500%, 08/01/05 ................. 2,000 1,983
Morgan Stanley
6.375%, 12/15/03 ................. 1,000 1,000
NationsBank
6.875%, 02/15/05 ................. 5,000 5,069
Occidental Petroleum
8.500%, 11/09/01 ................. 1,500 1,635
Philip Morris
9.250%, 12/01/97 ................. 2,500 2,584
7.125%, 08/15/02 ................. 1,000 1,024
Pitney Bowes Credit
6.625%, 06/01/02 ................. 6,550 6,689
Sovran Financial
9.750%, 06/15/99 ................. 1,000 1,085
USL Capital
6.500%, 12/01/03 ................. 2,000 2,015
WMX Technologies
6.250%, 10/15/00 ................. 500 501
- ---------------------------------------------------------
Total Corporate Obligations
(Cost $94,799) ............... 95,941
- ---------------------------------------------------------
Face Market
Amount Value
(000) (000)
------ ------
ASSET BACKED SECURITIES (7.5%)
American Express Master Trust,
Ser 1992-2A
6.600%, 05/15/00 ................. $6,350 $ 6,452
CIT RV Grantor Trust, Ser 1994-A, Cl A
4.900%, 07/15/09 ................. 645 633
EQCC Home Equity Loan Trust,
Ser 1994-1, Cl A
5.800%, 03/15/09 ................. 1,105 1,071
Ford Credit Auto Owner Trust,
Ser 1996-A A2
6.300%, 12/15/98 ................. 4,039 4,063
Greentree Financial, Ser 1995-9 A2
6.000%, 01/15/27 ................. 2,000 2,009
Greentree Manufacturing Housing,
Ser 1995-7 A2
6.150%, 11/15/26 ................. 2,000 2,001
Olympic Automobile Receivables Trust,
Ser 1995-D A4
6.050%, 11/15/00 ................. 3,700 3,717
The Money Store Home Equity Trust,
Ser 1995-A1
7.925%, 02/15/14 ................. 1,154 1,177
Volvo Auto Receivables Grantor Trust,
Ser 1992-B, Cl A
5.450%, 12/15/98 ................. 207 207
- ---------------------------------------------------------
Total Asset Backed Securities
(Cost $21,112) ............... 21,330
- ---------------------------------------------------------
CASH EQUIVALENT (3.0%)
Aim Liquid Assets Portfolio ......... 8,393 8,393
- ---------------------------------------------------------
Total Cash Equivalent
(Cost $8,393) ................ 8,393
- ---------------------------------------------------------
Total Investments (99.6%)
(Cost $276,793) .............. 282,368
- ---------------------------------------------------------
OTHER ASSETS AND LIABILITIES, NET (0.4%) 1,057
- ---------------------------------------------------------
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
INTERMEDIATE BOND FUND (concluded)
Value
(000)
------
NET ASSETS:
Portfolio Shares of Trust Class
($.001 par value -- 1.4 billion
shares authorized) based on
28,290,541 outstanding shares.............. $277,555
Portfolio Shares of Investor Class A
($.001 par value -- .1 billion shares
authorized) based on 225,004
outstanding shares......................... 2,233
Undistributed net investment income.......... 13
Accumulated net realized loss
on investments............................. (1,951)
Net unrealized appreciation
on investments............................. 5,575
- ---------------------------------------------------------
Total Net Assets: (100.0%).............. $283,425
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- TRUST CLASS
($281,186,874 DIVIDE 28,290,541
SHARES OUTSTANDING).......................... $9.94
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE - INVESTOR CLASS A
($2,237,654 DIVIDE 225,004
SHARES OUTSTANDING).......................... $9.94
- ---------------------------------------------------------
OFFERING PRICE PER SHARE -- INVESTOR CLASS A
($9.94 DIVIDE 97.0%)......................... $10.25
=========================================================
(A) Floating Rate Security--the rate reflected on the Statement of Net Assets is
the rate in effect on November 30, 1996. The date reported on the Statement
of Net Assets is the later of the date on which the security can be redeemed
at par or the next date on which the rate of interest is adjusted.
Cl--Class
CMO--Collateralized Mortgage Obligation
FFCB--Federal Farm Credit Bank
FHLB--Federal Home Loan Bank
FHLMC--Federal Home Loan Mortgage Corporation
FNMA--Federal National Mortgage Association
GNMA--Government National Mortgage Association
MTN--Medium Term Note
Ser--Series
TBA--To Be Announced
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
GOVERNMENT BOND FUND
Face Market
Amount Value
(000) (000)
------ ------
U.S. TREASURY OBLIGATIONS (55.0%)
U.S. Treasury Bonds
8.750%, 11/15/08.................... $ 500 $ 574
8.125%, 05/15/21.................... 500 599
8.000%, 11/15/21.................... 500 592
7.125%, 02/15/23.................... 250 270
6.250%, 08/15/23.................... 1,100 1,066
U.S. Treasury Notes
6.000%, 11/30/97.................... 250 251
6.000%, 12/31/97.................... 500 503
5.125%, 02/28/98.................... 250 249
5.125%, 03/31/98.................... 500 498
5.875%, 04/30/98.................... 500 503
5.375%, 05/31/98.................... 250 250
6.000%, 05/31/98.................... 1,050 1,057
6.250%, 06/30/98.................... 500 505
5.875%, 08/15/98.................... 500 503
6.375%, 01/15/99.................... 500 508
5.000%, 02/15/99.................... 250 247
5.875%, 03/31/99.................... 250 251
6.750%, 05/31/99.................... 500 512
8.750%, 08/15/00.................... 500 549
5.625%, 02/28/01.................... 250 248
6.375%, 08/15/02.................... 500 512
5.750%, 08/15/03.................... 250 247
5.875%, 02/15/04.................... 250 249
5.875%, 11/15/05.................... 250 247
5.625%, 02/15/06.................... 500 485
- ---------------------------------------------------------
Total U.S. Treasury Obligations
(Cost $11,188).................. 11,475
- ---------------------------------------------------------
U.S. GOVERNMENT AGENCY OBLIGATIONS (5.3%)
FHLMC
6.395%, 05/16/00.................... 500 508
5.980%, 12/08/05.................... 350 343
FNMA MTN
6.770%, 09/01/05.................... 250 258
- ---------------------------------------------------------
Total U.S. Government Agency Obligations
(Cost $1,109) 1,109
- ---------------------------------------------------------
MORTGAGE-BACKED SECURITIES (13.4%)
FHLMC Pool D71261
7.500%, 05/01/26..................... 391 396
FHLMC Pool E00412
7.000%, 01/01/11..................... 276 279
FNMA Pool 356039
6.500%, 08/01/03..................... 249 248
FNMA TBA
7.000%, 12/11/26..................... 750 743
GNMA Pool 352020
6.500%, 11/15/23..................... 630 612
GNMA Pool 433176
8.000%, 08/15/26..................... 499 514
- ---------------------------------------------------------
Total Mortgage-Backed Securities
(Cost $2,749).................... 2,792
- ---------------------------------------------------------
Face Market
Amount Value
(000) (000)
------ ------
CORPORATE OBLIGATIONS (16.4%)
Associates of North America
6.000%, 03/15/99.................... $250 $ 251
6.000%, 03/15/00.................... 250 249
AT&T
7.000%, 05/15/05.................... 250 258
Capital One Bank MTN
6.830%, 05/17/99.................... 250 253
Ford Motor Credit
6.750%, 05/15/05.................... 400 401
General Motors Acceptance
7.750%, 01/15/99.................... 250 259
Houston Lighting & Power
6.100%, 03/01/00.................... 250 249
IBM
6.375%, 06/15/00.................... 250 252
Marriott International
7.125%, 06/01/07.................... 250 252
Paine Webber
6.250%, 06/15/98.................... 250 251
Philip Morris
7.625%, 05/15/02.................... 250 262
Pitney Bowes Credit
6.250%, 06/01/98.................... 250 252
Wal-Mart Stores
5.875%, 10/15/05.................... 250 240
- ---------------------------------------------------------
Total Corporate Obligations
(Cost $3,368)................... 3,429
- ---------------------------------------------------------
ASSET BACKED SECURITIES (5.4%)
EQCC Home Equity Loan Trust,
Ser 1994-1 A
5.800%, 03/15/09.................... 138 134
Honda Auto Receivables Grantor Trust,
Ser 1995-A
6.200%, 12/15/00.................... 455 457
Olympic Automobile Receivables Trust,
Ser 1995-D A4
6.050%, 11/15/00.................... 300 301
The Money Store, Ser 1995-A1
7.925%, 02/15/14.................... 231 235
- ---------------------------------------------------------
Total Asset Backed Securities
(Cost $1,123)................... 1,127
- ---------------------------------------------------------
CASH EQUIVALENT (2.7%)
Aim Liquid Assets Portfolio............ 571 571
- ---------------------------------------------------------
Total Cash Equivalent
(Cost $571)..................... 571
- ---------------------------------------------------------
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
GOVERNMENT BOND FUND (concluded)
Face Market
Amount Value
(000) (000)
------ ------
REPURCHASE AGREEMENT (5.0%)
J.P. Morgan
5.670%, dated 11/29/96, matures
12/02/96, repurchase price $1,031,387
(collateralized by GNMA obligation par
value $1,025,000, 8.000%, 11/15/26;
total market value: $1,060,847)
5.670%............................ $1,031 $ 1,031
- ---------------------------------------------------------
Total Repurchase Agreement
(Cost $1,031)................. 1,031
- ---------------------------------------------------------
Total Investments (103.2%)
(Cost $21,139)................ 21,534
- ---------------------------------------------------------
OTHER ASSETS AND LIABILITIES, NET (-3.2%) (665)
- ---------------------------------------------------------
NET ASSETS:
Portfolio Shares of Trust Class
($.001 par value -
.75 billion shares
authorized) based on
1,944,916 outstanding shares.................. 19,865
Portfolio Shares of Investor
Class B ($.001 par value -
.125 billion shares
authorized) based on
67,154 outstanding shares...................... 700
Accumulated net realized loss
on investments (91)
Net unrealized appreciation
on investments................................. 395
- ---------------------------------------------------------
Total Net Assets: (100.0%).................. $20,869
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- TRUST CLASS
($20,170,982 DIVIDE 1,944,916
SHARES OUTSTANDING).............................. $10.37
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- INVESTOR CLASS B(1)
($697,926 DIVIDE 67,154 SHARES OUTSTANDING)........... $10.39
=========================================================
(1) Investors Class B has a contingent deferred sales charge. For description of
a possible redemption charge, see the notes to the financial statements.
FHLMC--Federal Home Loan Mortgage Corporation
FNMA--Federal National Mortgage Association
GNMA--Government National Mortgage Association
MTN--Medium Term Note
Ser--Series
STRIPS--Separate Trading of Registered Interest and Principal Securities
TBA--To Be Announced
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND
Face Market
Amount Value
(000) (000)
------ ------
MUNICIPAL BONDS (98.5%)
VIRGINIA
Alexandria, VA Industrial
Development Authority, RB
7.200%, 01/01/98................... $1,000 $1,007
Arlington County, VA Industrial
Development Authority Arlington
Hospital Facility Project, RB,
Callable 09/01/03 @ 102
5.125%, 09/01/08................... 1,000 986
Arlington County, VA Industrial
Development Authority Arlington
Hospital Facility Project, RB,
Callable 09/01/03 @ 102, AMBAC
4.800%, 09/01/05................... 1,000 1,001
Arlington County, VA Public Improvements,
GO, Callable 07/15/03 @ 102
5.000%, 07/15/04................... 1,000 1,031
Arlington County, VA Public Improvements,
GO, Callable 08/01/04 @ 102
5.750%, 08/01/08................... 2,500 2,659
Arlington County, VA
Refunding Bond, GO
4.750%, 06/01/08................... 4,000 3,960
Augusta, VA Hospital Project, RB,
Prerefunded 09/01/01 @ 102
7.000%, 09/01/21................... 2,000 2,257
Big Stone Gap, VA Redevelopment &
Housing Authority Wallens Ridge
Project, RB, Callable 09/01/05 @ 102
5.250%, 09/01/10................... 3,600 3,582
Chesapeake, VA Hospital Authority
General Hospital Project, RB
8.200%, 07/01/05................... 1,000 1,119
Chesapeake, VA Public
Improvements, GO
5.800%, 08/01/02................... 2,000 2,130
Chesapeake, VA Refunding
Bond, GO
5.400%, 12/01/08................... 2,500 2,594
Chesterfield County,
VA Public Improvements,
GO, Callable 07/15/02 @ 101.50
5.875%, 07/15/09................... 2,000 2,107
Chesterfield County, VA
Refunding Bond, GO
5.650%, 07/15/00................... 3,000 3,154
Chesterfield County, VA, Ser A, GO,
Prerefunded 01/15/00 @ 102
6.750%, 01/15/10................... 1,000 1,090
Danville, VA School Improvements, GO,
Callable 08/01/03 @ 102, MBIA
5.400%, 08/01/08................... 500 514
Fairfax County, VA Industrial
Development Authority Inova Health System
Project, RB, Callable 08/15/06 @ 102
5.300%, 08/15/07................... 1,500 1,532
Face Market
Amount Value
(000) (000)
------ ------
Fairfax County, VA Refunding Bond,
Ser B, GO, Callable
11/01/99 @ 100.50
5.500%, 05/01/01 (B)............... $2,500 $2,603
Fairfax County, VA School
Improvements, GO,
Callable 06/01/01 @ 102
5.200%, 06/01/13 (B)............... 5,000 4,937
Fairfax County, VA Sewer
Authority, RB
5.625%, 07/15/01................... 1,000 1,054
Fairfax County, VA Sewer Authority, RB,
Callable 11/15/03 @ 102, AMBAC
5.400%, 11/15/07................... 2,000 2,070
5.500%, 11/15/09................... 3,000 3,082
Fairfax County, VA Sewer
Authority, RB, Prerefunded
11/15/99 @ 102, AMBAC
6.700%, 11/15/00................... 1,000 1,089
Fauquier County, VA School
Improvements, GO, Callable
07/15/03 @ 102
5.550%, 07/15/09................... 800 823
Fredericksburg, VA Industrial
Development Authority Medicorp
Health System Project, RB,
Callable 06/15/07 @ 102, AMBAC
5.300%, 06/15/10................... 3,000 2,977
Hampton, VA Public Improvements, GO
6.400%, 01/01/99................... 1,500 1,567
Hampton, VA Public Improvements,
Ser C, GO, Callable 08/01/03 @ 102
4.800%, 08/01/06................... 1,000 990
Hampton, VA Sanitation District
Wastewater Authority, RB,
Callable 10/01/03 @ 102
4.900%, 10/01/06................... 1,000 1,002
Harrisonburg, VA Industrial
Development Authority Rockingham
Memorial Hospital Project, RB,
Callable 12/01/02 @ 102, MBIA
5.750%, 12/01/13................... 3,000 3,037
Harrisonburg, VA Refunding Bond, GO
6.000%, 08/01/99................... 1,000 1,044
6.100%, 08/01/00................... 1,000 1,060
Henrico County, VA Industrial
Development Authority Governmental
Projects, RB, Callable 06/01/06 @ 102
5.150%, 06/01/07................... 2,500 2,537
Henrico County, VA Industrial
Development Authority
Westminister Project, RB
7.300%, 10/01/99................... 1,060 1,078
Henrico County, VA Refunding Bond, GO
4.500%, 01/15/00................... 1,000 1,011
Henrico County, VA Refunding Bond,
GO, Callable 01/15/03 @ 102
5.200%, 01/15/07.................... 1,000 1,029
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND (continued)
Face Market
Amount Value
(000) (000)
------ ------
Henry County, VA Public
Improvements, GO,
Callable 07/15/04 @ 102
6.000%, 07/15/14................... $1,000 $ 1,042
James City, VA Public
Improvements, GO, FGIC
4.800%, 12/15/05 (B)............... 1,000 1,000
James Madison University, VA, RB,
Callable 06/01/03 @ 102
5.375%, 06/01/09................... 500 497
Loudoun County, VA Sanitation Authority,
RB, Callable 01/01/03 @ 102, FGIC
5.900%, 01/01/02................... 1,000 1,066
Loudoun County, VA Sanitation Authority,
RB, Callable 04/01/03 @ 102, FGIC
6.100%, 01/01/04................... 1,250 1,361
Lynchburg, VA Refunding Bond, GO
5.250%, 04/01/08................... 2,000 2,042
Newport News, VA Public Housing
Authority Multi-Family Housing
For Newport-Oxford Project, RB
3.500%, 12/02/96 (A) (B)........... 1,300 1,300
Newport News, VA Public Improvements,
Ser A, GO, Callable 01/15/06 @ 102
5.200%, 01/15/16................... 960 929
Newport News, VA Public
Improvements, Ser A, GO,
Callable 07/01/05 @ 102, MBIA
5.500%, 07/01/12................... 2,500 2,541
Newport News, VA Refunding Bond, GO,
Callable 07/01/99 @ 101.50
5.700%, 07/01/05................... 2,000 2,077
Newport News, VA School Improvements,
Ser A, GO, Callable 11/01/00 @ 100.25
6.200%, 11/01/01................... 1,000 1,070
Newport News, VA School Improvements,
Ser A, GO, Prerefunded 11/01/00 @ 100.50
6.300%, 11/01/02................... 1,000 1,079
Norfolk, VA Industrial Development
Authority Childrens Hospital
Project, RB, AMBAC
6.900%, 06/01/06................... 1,000 1,159
Norfolk, VA Industrial Development
Authority Childrens Hospital Project,
RB, Callable 06/01/04 @ 102, AMBAC
5.100%, 06/01/07................... 1,000 1,007
Norfolk, VA Industrial Development
Authority Sentara Hospital Project,
Ser A, RB, Callable 11/01/04 @ 102
4.900%, 11/01/07................... 2,500 2,453
5.000%, 11/01/08................... 2,500 2,453
Norfolk, VA Industrial Development
Authority Sentara Hospital Project,
Ser A, RB, Callable 11/01/04 @ 102
4.800%, 11/01/06................... 1,000 982
Face Market
Amount Value
(000) (000)
------ ------
Norfolk, VA Redevelopment &
Housing Authority Tidewater
Community College Project, RB,
Callable 11/01/05 @ 102
5.800%, 11/01/08.................. $ 700 $ 745
Norfolk, VA Refunding Bond, GO
4.700%, 06/01/02 (B).............. 1,000 1,015
Norfolk, VA Refunding Bond, Ser A, GO
5.100%, 02/01/00.................. 4,000 4,100
Norfolk, VA Refunding &
Improvement Bond, GO
5.000%, 02/01/03.................. 1,000 1,024
Peninsula Ports, VA Hospital
Authority Mary Immaculate Project, RB
8.000%, 08/01/99.................. 765 807
Peninsula Ports, VA Industrial
Development Authority Olde Hampton Hotel
Project, RB, Callable 07/01/97 @ 101
4.875%, 07/01/16 (B).............. 500 505
Peninsula Ports, VA Riverside
Health System Project, Ser A, RB
5.600%, 07/01/98.................. 500 509
Petersburg, VA Hospital Authority
Southside Regional Medical
Center Project, RB
5.600%, 07/01/00.................. 1,600 1,650
5.900%, 07/01/02.................. 1,000 1,054
Portsmouth, VA Public
Improvements, GO,
Prerefunded 08/01/00 @ 102
6.750%, 08/01/04.................. 1,500 1,652
Portsmouth, VA Refunding Bond, GO
5.000%, 08/01/02.................. 1,000 1,022
Portsmouth, VA Refunding Bond, GO,
Callable 08/01/03 @ 102
5.450%, 08/01/07.................. 2,000 2,075
Prince William County, VA Park
Authority, RB
5.500%, 10/15/99.................. 500 505
5.800%, 10/15/01.................. 500 511
Prince William County, VA Park
Authority, RB, Callable 10/15/04 @ 102
6.200%, 10/15/05.................. 500 519
Prince William County, VA Public
Improvements, GO,
Prerefunded 02/01/99 @ 101.25
6.200%, 02/01/04.................. 1,000 1,055
Prince William County, VA Refunding Bond,
Ser A, GO
5.600%, 12/01/00.................. 1,000 1,052
Prince William County, VA Refunding Bond,
Ser C, GO, Callable 08/01/03 @ 102
5.000%, 08/01/07 (B)............... 5,000 5,012
Prince William County, VA Refunding Bond,
Ser C, GO, Callable 08/01/03 @ 102
5.100%, 08/01/08 (B)............... 1,000 1,002
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND (continued)
Face Market
Amount Value
(000) (000)
------ ------
Prince William County, VA Water &
Sewer Authority, RB, FGIC
6.000%, 07/01/00.................. $1,000 $ 1,057
Prince William County, VA Water &
Sewer Authority, RB, Prerefunded
07/01/01 @ 102, FGIC
6.500%, 07/01/21.................. 1,000 1,102
Richmond, VA Metropolitan
Expressway Authority, Ser A, RB,
Callable 07/15/02 @ 102, FGIC
5.900%, 07/15/03.................. 1,500 1,618
Richmond, VA Public Improvements,
Ser A, GO
6.000%, 01/15/00.................. 2,000 2,097
6.100%, 01/15/01 2,750 2,922
Richmond, VA Public Improvements,
Ser A, GO, Callable 01/15/05 @ 102
5.200%, 01/15/08.................. 1,250 1,269
5.300%, 01/15/09.................. 1,500 1,522
Richmond, VA Public Improvements,
Ser A, GO, Prerefunded 01/15/01 @ 102
6.300%, 01/15/04.................. 1,000 1,091
Richmond, VA Public Utility Authority,
Ser A, RB, Callable 01/15/98 @ 102
7.100%, 01/15/00.................. 1,000 1,049
Richmond, VA Refunding Bond, Ser B,
GO, Prerefunded 01/15/99 @ 101
6.500%, 01/15/02.................. 1,500 1,588
Roanoke Valley, VA Waste Authority, RB
5.400%, 09/01/02.................. 1,450 1,474
Roanoke, VA Industrial Development
Authority Roanoke Memorial
Hospital Project, RB
6.900%, 07/01/99.................. 1,000 1,060
Roanoke, VA Industrial Development
Authority Roanoke Memorial
Hospital Project, Ser B, RB,
Callable 07/01/02 @ 102
5.900%, 07/01/06.................. 2,500 2,631
Roanoke, VA Industrial Development
Authority Roanoke Memorial
Hospital Project, Ser B, RB,
Callable 07/01/02 @ 102
5.800%, 07/01/05.................. 500 521
Roanoke, VA Public Improvements, GO
6.625%, 08/01/97.................. 1,000 1,008
6.700%, 08/01/98.................. 1,000 1,009
4.900%, 02/01/06.................. 1,000 1,016
Roanoke, VA Public Improvements,
GO, Callable 02/01/06 @ 102
5.000%, 02/01/12.................. 3,165 3,058
Roanoke, VA Public Improvements,
Ser B, GO
5.800%, 08/01/00.................. 1,000 1,054
Face Market
Amount Value
(000) (000)
------ ------
Spotsylvania County, VA School
Improvements, GO, Callable
07/15/02 @ 102
5.300%, 07/15/03.................. $1,500 $ 1,553
Stafford County, VA Water
Authority, RB, FGIC
4.750%, 06/01/03.................. 1,000 1,011
Suffolk, VA Redevelopment & Housing
Authority Oak Springs Association
Project, RB, Mandatory
Put 02/01/97 @ 100
6.250%, 02/01/05 (B).............. 1,500 1,502
Suffolk, VA Refunding &
Improvement Bond, GO
5.200%, 08/01/02.................. 1,500 1,553
Suffolk, VA Refunding Bond, GO
5.100%, 08/01/00.................. 1,000 1,028
Suffolk, VA Refunding Bond, GO,
Callable 08/01/03 @ 102
5.600%, 08/01/06.................. 2,000 2,098
5.700%, 08/01/07.................. 2,000 2,098
University of Virginia, Ser A, RB,
Callable 06/01/03 @ 102
5.200%, 06/01/12.................. 1,500 1,485
University of Virginia,
VA Hospital Authority,
Ser E, RB, Callable 06/01/99 @ 102
6.750%, 06/01/01.................. 2,500 2,672
6.900%, 06/01/04 2,000 2,138
University of Virginia, VA Hospital
Authority, Ser E, RB,
Callable 06/01/99 @ 100
6.000%, 06/01/13.................. 1,000 1,014
Upper Occoquan, VA Sewer Authority, RB,
Prerefunded 07/01/01 @ 102, MBIA
6.150%, 07/01/03.................. 1,000 1,095
6.250%, 07/01/04.................. 1,000 1,099
Upper Occoquan, VA Sewer Authority, RB,
Ser A, Callable 07/01/06 @ 102, MBIA
5.000%, 07/01/15.................. 5,000 4,806
Upper Occoquan, VA Sewer Authority,
Ser A, RB,
Callable 07/01/06 @ 102, MBIA
5.000%, 07/01/08.................. 1,000 984
Virginia Beach, VA Development
Authority Sentara Bayside
Hospital Project, RB, Callable
11/01/01 @ 102
6.300%, 11/01/21.................. 1,750 1,813
Virginia Beach, VA Highway Improvements,
Ser A, GO, Callable 03/01/01 @ 102
6.400%, 03/01/03.................. 1,000 1,081
Virginia Beach, VA Judicial Center
Project, Prerefunded 09/01/00
@ 102, COP, FGIC
7.000%, 09/01/01.................. 1,500 1,669
Virginia Beach, VA Public Improvements,
GO, Callable 05/01/97 @ 102
6.900%, 05/01/98.................. 1,000 1,032
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND (continued)
Face Market
Amount Value
(000) (000)
------ ------
Virginia Beach, VA Public
Improvements, Ser A, GO,
Prerefunded 06/01/00 @ 102
6.850%, 06/01/03................... $2,000 $ 2,203
Virginia Beach, VA Public Improvements,
Ser A, GO, Prerefunded 10/01/99 @ 102
6.900%, 10/01/03................... 1,000 1,090
Virginia Beach, VA Public Improvements,
Ser C, GO
6.100%, 08/01/00................... 1,000 1,068
6.100%, 08/01/01................... 1,000 1,080
Virginia Beach, VA Refunding Bond, GO
5.000%, 07/15/03................... 1,000 1,034
5.300%, 07/15/07................... 2,000 2,083
5.450%, 07/15/11................... 1,000 1,031
Virginia Beach, VA Refunding Bond, GO,
Callable 11/01/04 @ 102
5.750%, 11/01/10 (B)............... 3,500 3,649
Virginia State College Building Authority
University of Richmond Project, RB,
Callable 11/01/02 @ 102
6.250%, 11/01/12................... 2,000 2,105
Virginia State College Building Authority
University of Richmond Project, RB,
Callable 11/01/04 @ 100
5.550%, 11/01/19................... 4,000 4,205
Virginia State College Building Authority
University of Richmond Project, RB,
Callable 11/01/99 @ 101
6.400%, 11/01/22................... 1,000 1,060
Virginia State Education Loan Authority,
Ser B, RB, ETM
4.850%, 09/01/01 (B)............... 520 528
Virginia State Education Loan Authority,
Ser F, RB, ETM
5.250%, 03/01/00 (B)............... 560 578
Virginia State Housing Development
Authority, Ser B, RB,
Callable 05/01/00 @ 102
7.375%, 05/01/05................... 1,000 1,044
Virginia State Housing Development
Authority, Ser B, RB,
Callable 01/01/06 @ 102
6.350%, 01/01/15................... 3,000 3,094
Virginia State Housing Development
Authority, Ser C, RB,
Callable 05/01/04 @ 102
5.700%, 05/01/05................... 1,000 1,035
Virginia State Housing Development
Authority, Ser C, RB,
Callable 11/01/03 @ 102
5.600%, 11/01/07................... 1,000 1,009
Virginia State Housing Development
Authority, Ser C, RB,
Callable 01/01/02 @ 102
6.000%, 07/01/06................... 2,000 2,043
5.550%, 01/01/11................... 3,000 2,993
Face Market
Amount Value
(000) (000)
------ ------
Virginia State Housing Development
Authority, Ser C-4, RB, Callable
01/01/02 @ 102
4.900%, 01/01/04................... $1,000 $ 994
Virginia State Public Building Authority,
RB, Callable 08/01/05 @ 101
5.100%, 08/01/06................... 5,000 5,119
Virginia State Public Building Authority,
Ser B, RB
5.600%, 08/01/01................... 4,000 4,205
Virginia State Public School Authority,
RB, Callable 01/01/02 @ 102
6.250%, 01/01/08................... 2,000 2,143
Virginia State Public School Authority,
Ser B, RB, Callable 01/01/00 @ 102
5.850%, 01/01/02................... 1,500 1,579
Virginia State Public School Authority,
Ser B, RB
5.600%, 01/01/05 (B)............... 1,880 1,998
Virginia State Public School Authority,
Ser C, RB
4.500%, 01/01/00................... 1,000 1,006
Virginia State Public School Authority,
Ser C, RB, Callable 08/01/05 @ 102
5.000%, 08/01/07 (B)............... 1,000 1,003
Virginia State Public School Authority,
Ser C, RB, Callable 01/01/04 @ 102
4.875%, 01/01/09................... 1,000 970
Virginia State Refunding Bond, GO
5.600%, 06/01/02................... 4,750 5,041
Virginia State Transportation Board
Northern Transportation District, RB,
Callable 05/15/03 @ 102
5.000%, 05/15/06................... 1,250 1,261
Virginia State Transportation Board
Northern Transportation District, RB,
Prerefunded 07/01/00 @ 102, FSA
7.000%, 07/01/05................... 970 1,075
Virginia State Transportation Board
Refunding Bond, Ser A, GO,
Callable 07/01/03 @ 102
5.200%, 07/01/08................... 2,000 2,038
Virginia State Transportation Board U.S.
Route 58 Corridor Project, RB,
Callable 05/15/98 @ 102
6.500%, 05/15/99................... 2,000 2,103
6.000%, 05/15/19................... 1,000 1,023
Virginia State University Medical College
Project, Ser D, RB
3.900%, 07/01/99................... 2,000 1,985
4.250%, 07/01/01................... 2,000 1,985
Virginia State University, Ser A, RB,
Callable 05/01/06 @ 102
5.625%, 05/01/16................... 2,500 2,516
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND (concluded)
Face Market
Amount Value
(000) (000)
------ ------
Winchester, VA Industrial Development
Authority Medical Center Project, RB,
Prerefunded 01/01/00 @ 102, AMBAC
7.250%, 01/01/15................... $1,000 $ 1,105
Winchester, VA Public Improvements, GO
6.050%, 03/01/00................... 500 528
6.150%, 03/01/01................... 500 536
Winchester, VA Refunding Bond, GO,
Callable 01/15/04 @ 102
5.400%, 01/15/08 (B)............... 1,000 1,024
- ---------------------------------------------------------
247,631
- ---------------------------------------------------------
Total Municipal Bonds
(Cost $239,923)................ 247,631
- ---------------------------------------------------------
CASH EQUIVALENT (1.3%)
Federated Virginia Municipal Cash Trust 3,120 3,120
- ---------------------------------------------------------
Total Cash Equivalent
(Cost $3,120).................. 3,120
- ---------------------------------------------------------
Total Investments (99.8%)
(Cost $243,043)................ 250,751
- ---------------------------------------------------------
OTHER ASSETS AND LIABILITIES, NET (0.2%) 571
- ---------------------------------------------------------
NET ASSETS:
Portfolio Shares of Trust Class
($.001 par value --
.75 billion shares
authorized) based on
23,798,681 outstanding shares............... 236,211
Portfolio Shares of Investor Class A
($.001 par value -- .25 billion shares
authorized) based on 801,395
outstanding shares........................... 8,225
Accumulated net realized loss
on investments............................... (822)
Net unrealized appreciation
on investments............................... 7,708
- ---------------------------------------------------------
Total Net Assets: (100.0%)................ $251,322
- ---------------------------------------------------------
Market
Value
(000)
------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- TRUST CLASS
($243,137,138 DIVIDE 23,798,681
SHARES OUTSTANDING)............................ $10.22
- --------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- INVESTOR CLASS A
($8,184,588 DIVIDE 801,395
SHARES OUTSTANDING)............................ $10.21
- --------------------------------------------------------
OFFERING PRICE PER SHARE -- INVESTOR
CLASS A ($10.21 DIVIDE 96.5%).................. $10.58
========================================================
(A) Floating Rate Security--the rate reflected on the Statement of Net Assets is
the rate in effect on November 30, 1996. The date reported on the Statement
of Net Assets is the later of the date on which the security can be redeemed
at par or the next date on which the rate of interest is adjusted.
(B) Security backed by letter of credit or credit support.
AMBAC--American Municipal Bond Assurance Corporation
COP--Certificate of Participation
ETM--Escrowed to Maturity
FGIC--Federal Guaranty Insurance Company
FSA--Financial Securities Assurance, Inc.
GO--General Obligation
MBIA--Municipal Bond Investors Assurance
RB--Revenue Bond
Ser--Series
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
VIRGINIA MUNICIPAL BOND FUND
Face Market
Amount Value
(000) (000)
------ ------
MUNICIPAL BONDS (100.5%)
VIRGINIA
Albemarle County, VA Industrial
Development Authority Hospital
Revenue, RB, Callable 10/01/03 @ 102
5.800%, 10/01/09................... $500 $508
Alexandria, VA Industrial Development
Authority Potomac Electric Project,
RB, Callable 02/15/04 @ 102 MBIA
5.375%, 02/15/24................... 250 244
Alexandria, VA Redevelopment &
Housing Authority Buckingham Village
Apartments Project, RB Callable
01/01/06 @ 102
6.050%, 07/01/16................... 250 252
Alexandria, VA Industrial Development
Authority Episcopal High School
Project, RB, Callable 01/01/06 @ 102
5.300%, 01/01/11................... 500 500
Arlington County, VA Public
Improvements, GO
5.000%, 06/01/01................... 250 258
Arlington County, VA Industrial
Development Authority Arlington
Hospital Facility Project, RB,
Callable 09/01/03 @ 102 AMBAC
5.000%, 09/01/21................... 200 185
Arlington County, VA Public
Improvements, GO, Callable
06/01/05 @ 101.50
5.400%, 06/01/12................... 250 254
Bedford, VA Electric System, RB,
Callable 06/01/04 @ 102 AMBAC
5.250%, 06/01/25................... 250 245
Big Stone Gap, VA Wallens Ridge
Development Project, RB Callable
09/01/05 @ 102
5.500%, 09/01/15................... 250 247
Chesapeake Bay, VA Bridge & Tunnel
Authority, RB, Callable
07/01/05 @ 102, MBIA
5.000%, 07/01/22................... 500 468
Chesapeake Bay, VA Bridge & Tunnel
Authority, RB, Callable
07/01/05 @ 102 FGIC
5.500%, 07/01/06................... 150 158
Chesapeake, VA Refunding Bond, GO
5.250%, 12/01/06................... 500 519
Chesterfield County, VA, Ser A, GO,
Prerefunded 01/15/00 @ 102
6.750%, 01/15/10................... 200 218
Fairfax County, VA Industrial
Development Authority Inova Health
System Project, RB, FSA
5.250%, 08/15/19................... 500 488
Face Market
Amount Value
(000) (000)
------ ------
Fairfax County, VA Water Authority,
RB, Callable 04/01/07 @ 102, AMBAC
6.000%, 04/01/22................... $250 $ 262
Fairfax, VA Redevelopment & Housing
Authority, RB, Callable 06/01/06 @ 102
5.500%, 06/01/12................... 425 425
Fairfax, VA School & Public
Improvements, GO, Callable
06/01/03 @ 102
5.000%, 06/01/07................... 500 504
Frederick-Winchester, VA Service
Authority Regional Sewer System
Project, RB, Callable
10/01/03 @ 102 AMBAC
5.750%, 10/01/10................... 150 154
Fredericksburg, VA Industrial Development
Authority Hospital Facilities Project, RB,
Callable 06/15/07 @ 102, AMBAC
5.300%, 06/15/10................... 500 496
Hampton Roads, VA Sanitation
District, RB, Callable 10/01/03 @ 102
5.100%, 10/01/08................... 335 334
Hanover County, VA Water &
Sewer System, RB, Callable
02/01/06 @ 102 MBIA
5.250%, 02/01/16................... 250 244
5.250%, 02/01/26................... 250 240
Henrico County, VA Public
Improvements, GO, Callable
01/15/03 @ 102
5.200%, 01/15/07................... 250 257
James City County, VA Public
Improvements, GO,
Callable 12/15/05 @ 102 FGIC
5.250%, 12/15/14................... 250 248
Leesburg, VA Public Improvements,
GO, Callable 06/01/05 @ 102 AMBAC
5.400%, 06/01/10................... 250 255
Loudoun County, VA Sanitation
Authority Water & Sewer Project,
RB, Callable 01/01/03 @ 102 FGIC
6.250%, 01/01/16................... 150 161
Loudoun County, VA School
Improvements, GO, Callable
06/01/06 @ 102
5.600%, 06/01/10 (A)............... 250 259
Lynchburg, VA Public Improvements,
GO, Callable 04/01/03 @ 102
5.000%, 04/01/12 (A)............... 200 194
Newport News, VA Public
Improvements, Ser A, GO,
Callable 07/01/05 @ 102 MBIA
5.500%, 07/01/12................... 250 254
Norfolk, VA Public & Sewer
Improvements, GO Callable
06/01/06 @ 101
5.250%, 06/01/09................... 500 505
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
VIRGINIA MUNICIPALBONDFUND (continued)
Face Market
Amount Value
(000) (000)
------ ------
VIRGINIA (continued)
Norfolk, VA Public Improvements,
GO, Callable 06/01/05 @ 101 MBIA
5.750%, 06/01/12.................... $150 $155
Norfolk, VA Redevelopment &
Housing Authority, Tidewater
Community College Project, RB,
Callable 11/01/05 @ 102
5.875%, 11/01/15.................... 100 104
Northern VA Transportation District,
VA Railway Express Project, RB,
Callable 07/01/00 @ 100 FSA
6.000%, 07/01/14.................... 250 256
Petersburg, VA Public Improvements,
GO, Callable 07/15/04 @ 102 FGIC
5.750%, 07/15/14.................... 150 153
Portsmouth, VA Public Improvements,
GO, Prerefunded 08/01/00 @ 102
6.750%, 08/01/04.................... 250 275
Portsmouth, VA Public Improvements,
GO, Callable 08/01/06 @ 101, FGIC
5.250%, 08/01/21.................... 500 492
Prince William County, VA Water &
Sewer Systems, RB, Prerefunded
07/01/01 @ 102 FGIC
6.500%, 07/01/21.................... 250 276
Richmond, VA Metropolitan
Expressway Authority, Ser A, RB,
Callable 07/15/02 @ 100 FGIC
5.750%, 07/15/22.................... 250 252
Richmond, VA Refunding Bond,
Ser B, GO, Callable 01/15/06 @ 102 FGIC
5.000%, 01/15/21.................... 250 234
Riverside, VA Regional Jail Authority,
RB, Callable 07/01/05 @ 102 MBIA
6.000%, 07/01/25.................... 250 260
Roanoke, VA Public Improvements
Project, GO, Callable 08/01/04 @ 102
5.150%, 08/01/12.................... 250 244
Spotsylvania County, VA Public
Improvements, GO, Callable
07/15/02 @ 102
5.875%, 07/15/10.................... 150 156
Stafford County, VA Water & Sewer
System, RB, Callable 06/01/03 @ 102 FGIC
5.250%, 06/01/12.................... 250 247
University of Virginia, Ser A, RB,
Callable 06/01/03 @ 102
5.200%, 06/01/15.................... 400 392
Upper Occoquan, VA Sewer Authority,
Ser A, RB, Callable 07/01/06 @ 102, MBIA
5.000%, 07/01/15.................... 250 240
Virginia Beach, VA Refunding Bond, GO
5.450%, 07/15/11.................... 200 206
Face Market
Amount Value
(000) (000)
------ ------
Virginia College Building Authority
University of Richmond Project,
RB, Callable 11/01/99 @ 101
6.400%, 11/01/22.................... $150 $159
Virginia Polytechnic Institute and State
University, RB, Callable 06/01/06 @ 102
5.500%, 06/01/16.................... 200 200
Virginia Public School Authority, Ser B,
RB, Prerefunded 01/01/99 @102
6.500%, 01/01/03.................... 400 427
Virginia State Housing Development
Authority, Commonwealth Meeting
Project, Ser A-4, AMT, RB, Callable
01/01/06 @ 102 MBIA
6.350%, 07/01/18.................... 150 154
Virginia State Park Authority
Biotechnology Research Project, RB,
Callable 09/01/06 @ 101
5.250%, 09/01/18.................... 500 493
Virginia State Public Building
Authority, RB, Callable 08/01/05 @ 101
5.200%, 08/01/16.................... 300 290
Virginia State Public School Authority
York County Project, GO,
Callable 07/15/04 @ 102
5.900%, 07/15/13.................... 150 156
Virginia State Public School Authority,
Ser A, RB, Callable 08/01/04 @ 102
6.125%, 08/01/08 (A)................ 100 109
Virginia State Transportation Board,
U.S. Route 58 Corridor Project,
Ser PG-A, RB, Callable 05/15/03 @ 102
5.400%, 05/15/08.................... 150 153
Virginia State Transportation Board, RB,
Callable 05/15/98 @ 102
6.000%, 05/15/19.................... 250 256
Virginia State University Construction
Improvements, Ser A, GO, Callable
06/01/03 @ 102
5.000%, 06/01/06.................... 450 458
Virginia State University, Ser A, RB,
Callable 05/01/06 @ 102
5.625%, 05/01/16.................... 500 503
West Point, VA Industrial Development
Authority Chesapeake Corporation
Project, Ser B, RB, Callable
03/01/04 @ 102
6.250%, 03/01/19.................... 150 155
- ---------------------------------------------------------
16,791
- ---------------------------------------------------------
Total Municipal Bonds
(Cost $16,494)................... 16,791
- ----------------------------------------------------------
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
VIRGINIA MUNICIPALBONDFUND (concluded)
Face Market
Amount Value
(000) (000)
------ ------
CASH EQUIVALENT (3.4%)
Federated Virginia Municipal Cash Trust $564 $ 564
- ---------------------------------------------------------
Total Cash Equivalent
(Cost $564)...................... 564
- ---------------------------------------------------------
Total Investments (103.9%)
(Cost $17,058)................... 17,355
- ---------------------------------------------------------
OTHER ASSETS AND LIABILITIES, NET (-3.9%) (656)
- ---------------------------------------------------------
NET ASSETS:
Portfolio Shares of Trust Class
($.001 par value --
.75 billion shares
authorized) based on
1,547,768 outstanding shares................. $15,629
Portfolio Shares of Investor Class B
($.001 par value -- .125 billion shares
authorized) based on 76,372
outstanding shares........................... 772
Accumulated net realized gain
on investments............................... 1
Net unrealized appreciation
on investments............................... 297
- ---------------------------------------------------------
Total Net Assets: (100.0%)................ $16,699
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- TRUST CLASS
($15,911,483 DIVIDE 1,547,768
SHARES OUTSTANDING)............................ $10.28
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- INVESTOR CLASS B (1)
($787,410 DIVIDE 76,372 SHARES OUTSTANDING).... $10.31
=========================================================
(A) Security is backed by letter of credit or credit support.
(1) Investors Class B has a contingent deferred sales charge.
For description of a possible redemption charge, see the
notes to the financial statements.
AMBAC--American Municipal Bond Assurance Corporation
AMT--Alternative Minimum Tax
FGIC--Financial Guaranty Insurance Company
FSA--Financial Securities Assurance, Inc.
GO--General Obligation
MBIA--Municipal Bond Investors Assurance
RB--Revenue Bond
Ser--Series
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
MARYLAND MUNICIPAL BOND FUND
Face Market
Amount Value
(000) (000)
------ ------
MUNICIPAL BONDS (95.6%)
MARYLAND
Anne Arundel County, MD Public
Improvements, GO, Callable
02/01/04 @ 101.50
4.600%, 02/01/06.............................. $250 $ 244
Baltimore County, MD Parking
Authority, RB, Prerefunded
07/01/99 @ 102
7.200%, 07/01/19.............................. 200 219
Baltimore County, MD Metropolitan
District Water Utility Improvements,
Ser 64, GO, Callable 08/01/03 @ 102
5.000%, 08/01/13.............................. 100 96
Baltimore, MD Construction & Public
Improvements, GO, FGIC
5.800%, 10/15/97.............................. 100 102
Baltimore, MD Construction & Public
Improvements, GO,
Callable 06/01/06 @ 101
5.500%, 06/01/16.............................. 250 254
Baltimore, MD Parking Authority
Refunding Bond, RB, FGIC
4.350%, 07/01/02.............................. 200 199
Baltimore, MD Pollution Control
General Motors Corporate Project, RB
5.350%, 04/01/08.............................. 250 255
Calvert County, MD Pollution Control
Baltimore Gas & Electric Company
Project, RB, Callable 07/15/04 @ 102
5.550%, 07/15/14.............................. 250 250
Harford County, MD Refunding Bond,
GO, Callable 12/01/03 @ 102
4.900%, 12/01/12.............................. 100 96
Howard County, MD Public Improvements,
Ser A, GO, Callable 02/15/05 @ 101
5.650%, 02/15/16.............................. 100 102
Maryland State Community Development
Administration Multifamily Housing
Project, Ser B, RB, Callable
05/15/05 @ 102
5.650%, 05/15/15 (A).......................... 115 113
Maryland State Facilities Improvement, GO,
Callable 10/15/05 @ 100
5.000%, 10/15/06.............................. 250 256
Maryland State First Series, GO,
Prerefunded 03/01/00 @ 101
6.700%, 03/01/03.............................. 100 108
Maryland State Health & Higher
Educational Facilities Authority,
Good Samaritan Hospital Project,
RB, Callable 07/01/03 @ 102
5.750%, 07/01/19.............................. 100 101
Face Market
Amount Value
(000) (000)
------ ------
Maryland State Health & Higher Educational
Facilities Authority, Loyola College Project,
Ser A, RB, Callable 10/01/06 @ 102, MBIA
5.500%, 10/01/16.............................. $250 $ 252
Maryland State Health & Higher Educational
Facilities Authority, University of Maryland
Medical Systems Project, Ser A, RB,
Prerefunded 07/01/01 @ 100, FGIC
6.500%, 07/01/21.............................. 200 218
Maryland State Industrial
Development Authority, Holy
Cross Health System, RB,
Callable 12/01/03 @ 102
5.500%, 12/01/15.............................. 100 98
Maryland State National Park &
Planning Authority, Prince
Georges Project, GO, Prerefunded
07/01/00 @102
6.900%, 07/01/02.............................. 100 111
Maryland State Public Improvements,
Ser 1, GO, Callable 02/15/06 @ 101.50
4.700%, 02/15/10.............................. 400 384
Maryland State Stadium Authority,
Sports Facility, RB, Callable
03/01/06 @ 101, AMBAC
5.800%, 03/01/26.............................. 250 254
Maryland State Transportation
Authority, RB, ETM
6.800%, 07/01/16.............................. 120 137
Montgomery County, MD Community
Housing Authority Multifamily
Housing Project, Ser A, RB,
Callable 07/01/05 @ 102
6.000%, 07/01/20 (A).......................... 100 101
Montgomery County, MD Human
Services Headquarters Project, RB
5.400%, 08/01/06.............................. 200 209
Montgomery County, MD Pollution
Control Potomac Electric Power
Company Project, RB, Callable
02/15/04 @ 102
5.375%, 02/15/24.............................. 100 97
Montgomery County, MD Refunding
Bond, Ser A, GO
5.800%, 07/01/07.............................. 500 541
Ocean City, MD Refunding Bond,
GO, MBIA
4.500%, 10/15/05.............................. 100 98
Prince Georges County, MD Water
Utility Improvements Stormwater
Management Project, GO,
Callable 03/15/03 @ 102
5.500%, 03/15/13.............................. 100 100
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
MARYLAND MUNICIPAL BOND FUND (concluded)
Face Market
Amount Value
(000) (000)
------ ------
MARYLAND (continued)
Saint Mary's County, MD, GO,
Callable 11/01/03 @ 102, AMBAC
5.500%, 11/01/07................... $150 $ 156
University of Maryland, Auxiliary
Faculty & Tuition Project, RB,
Callable 04/01/06 @ 101
5.500%, 04/01/08................... 100 104
University of Maryland, Auxiliary
Facilities Project, Ser A, RB,
Callable 04/01/05 @ 102
5.400%, 04/01/09................... 100 102
Washington County, MD Refunding
Bond, GO, Callable 01/01/03
@ 102, FGIC
5.250%, 01/01/07................... 100 103
Washington Suburban Sanitation
District, MD Refunding Bond, GO,
Callable 06/01/04 @ 102
5.000%, 06/01/14................... 100 96
Worcester County, MD Refunding
Bond, GO, Callable 08/01/06
@ 101, MBIA
5.500%, 08/01/12 100 102
- ---------------------------------------------------------
5,658
- ---------------------------------------------------------
Total Municipal Bonds
(Cost $5,613)................... 5,658
- ---------------------------------------------------------
CASH EQUIVALENT (2.5%)
Federated Maryland Municipal Cash Trust 151 151
- ---------------------------------------------------------
Total Cash Equivalent
(Cost $151)..................... 151
- ---------------------------------------------------------
Total Investments (98.1%)
(Cost $5,764)................... 5,809
- ---------------------------------------------------------
OTHER ASSETS AND LIABILITIES, NET (1.9%) 112
- ---------------------------------------------------------
Market
Value
(000)
------
NET ASSETS:
Portfolio Shares of Trust Class
($.001 par value -- .9 billion shares
authorized) based on
595,365 outstanding shares.................. $5,791
Portfolio Shares of Investor Class B
($.001 par value -- 50 million shares
authorized) based on
11,588 outstanding shares................... 110
Accumulated net realized loss
on investments.............................. (25)
Net unrealized appreciation
on investments.............................. 45
- ---------------------------------------------------------
Total Net Assets: (100.0%)............... $5,921
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- TRUST CLASS
($5,808,157 DIVIDE 595,365
SHARES OUTSTANDING)........................... $9.76
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- INVESTOR CLASS B (1)
($113,129 DIVIDE 11,588 SHARES OUTSTANDING)... $9.76
=========================================================
(A) Security backed by letter of credit or credit support.
(1) Investors Class B has a contingent deferred sales charge.
For description of a possible redemption charge, see the
notes to the financial statements.
AMBAC--American Municipal Bond Assurance Corporation
ETM--Escrowed to Maturity
FGIC--Federal Guaranty Insurance Company
GO--General Obligation
MBIA--Municipal Bond Investors Assurance
RB--Revenue Bond
Ser--Series
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
VALUE FUND
Market
Value
Shares (000)
------ ------
COMMON STOCKS (94.3%)
AIR TRANSPORTATION (1.2%)
AMR*.................................. 75,000 $ 6,844
- ---------------------------------------------------------
AIRCRAFT (1.6%)
General Dynamics...................... 125,000 9,219
- ---------------------------------------------------------
AUTOMOTIVE (1.8%)
General Motors........................ 175,000 10,084
- ---------------------------------------------------------
BANKS (7.0%)
Banc One.............................. 175,000 8,334
BankAmerica........................... 115,000 11,845
Bankers Trust New York................ 150,000 13,050
Fleet Financial Group................. 125,000 6,922
- ---------------------------------------------------------
40,151
- ---------------------------------------------------------
CHEMICALS (2.1%)
Dow Chemical.......................... 145,000 12,144
- ---------------------------------------------------------
COMPUTERS & SERVICES (9.1%)
Digital Equipment*.................... 200,000 7,350
IBM................................... 50,000 7,969
Intel................................. 100,000 12,675
Storage Technology*................... 275,000 13,716
Tandem Computers*..................... 800,000 10,900
- ---------------------------------------------------------
52,610
- ---------------------------------------------------------
CONSTRUCTION (1.3%)
Foster Wheeler........................ 200,000 7,225
- ---------------------------------------------------------
DIVERSIFIED (2.2%)
Loews................................. 135,000 12,521
- ---------------------------------------------------------
ELECTRONICS & OTHER ELECTRICAL EQUIPMENT (1.7%)
W.W. Grainger......................... 125,000 9,938
- ---------------------------------------------------------
ENERGY SERVICES (2.4%)
Dresser Industries.................... 420,000 13,755
- ---------------------------------------------------------
ENVIRONMENTAL SERVICES (0.6%)
WMX Technologies...................... 100,000 3,600
- ---------------------------------------------------------
FOOD, BEVERAGE & TOBACCO (8.0%)
Coca Cola ............................ 55,000 2,812
Hershey Foods......................... 230,000 11,471
Philip Morris......................... 110,000 11,344
Quaker Oats........................... 200,000 7,875
Sara Lee.............................. 325,000 12,756
- ---------------------------------------------------------
46,258
- ---------------------------------------------------------
HOUSEHOLD PRODUCTS (1.4%)
Tupperware............................ 150,000 7,950
- ---------------------------------------------------------
Market
Value
Shares (000)
------ ------
INSURANCE (8.1%)
Aetna................................. 150,000 $10,819
Chubb................................. 40,000 2,170
Cigna................................. 100,000 14,138
Torchmark............................. 150,000 7,800
Travelers ............................ 259,999 11,700
- ---------------------------------------------------------
46,627
- ---------------------------------------------------------
MACHINERY (3.0%)
Caterpillar........................... 75,000 5,934
Ingersoll Rand........................ 250,000 11,625
- ---------------------------------------------------------
17,559
- ---------------------------------------------------------
MEDICAL PRODUCTS & SERVICES (7.6%)
American Home Products................ 125,000 8,031
Bristol-Myers Squibb.................. 115,000 13,081
Schering Plough....................... 180,100 12,832
United States Surgical................ 250,000 10,031
- ---------------------------------------------------------
43,975
- ---------------------------------------------------------
METALS & MINING (2.9%)
Alumax*............................... 350,000 11,331
LTV................................... 498,050 5,354
- ---------------------------------------------------------
16,685
- ---------------------------------------------------------
PAPER & PAPER PRODUCTS (2.5%)
Fort Howard*.......................... 175,000 4,944
Westvaco.............................. 344,900 9,743
- ---------------------------------------------------------
14,687
- ---------------------------------------------------------
PETROLEUM REFINING (8.4%)
Amoco................................. 75,000 5,822
Exxon................................. 125,000 11,828
Mobil................................. 105,000 12,705
Union Texas Petroleum................. 450,000 10,013
Unocal................................ 200,000 8,150
- ---------------------------------------------------------
48,518
- ---------------------------------------------------------
PHOTOGRAPHIC EQUIPMENT & SUPPLIES (1.7%)
Eastman Kodak......................... 120,000 9,720
- ---------------------------------------------------------
PRINTING & PUBLISHING (1.5%)
Tribune............................... 100,000 8,650
- ---------------------------------------------------------
RETAIL (5.4%)
Albertson's........................... 150,000 5,231
Circuit City.......................... 150,000 5,006
Dillard Department Stores............. 325,000 9,953
Toys R Us*............................ 325,000 11,213
- ---------------------------------------------------------
31,403
- ---------------------------------------------------------
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
VALUE FUND (concluded)
Shares/
Face Market
Amount Value
(000) (000)
------ ------
SAVINGS & LOAN (2.3%)
H.F. Ahmanson...................... 400,000 $ 13,200
- ---------------------------------------------------------
TELEPHONES & TELECOMMUNICATION (4.3%)
Ameritech.......................... 150,000 8,831
AT&T............................... 180,000 7,065
MCI Communications................. 300,000 9,150
- ---------------------------------------------------------
25,046
- ---------------------------------------------------------
TRANSPORTATION SERVICES (1.2%)
CSX................................ 150,000 7,012
- ---------------------------------------------------------
UTILITIES, ELECTRIC, & GAS (5.0%)
Consolidated Natural Gas........... 175,000 9,997
Southern........................... 375,000 8,344
Texas Utilities.................... 260,000 10,270
- ---------------------------------------------------------
28,611
- ---------------------------------------------------------
Total Common Stocks
(Cost $446,933)............. 543,992
- ---------------------------------------------------------
CASH EQUIVALENT (4.4%)
Aim Liquid Assets Portfolio........ $25,048 25,048
- ---------------------------------------------------------
Total Cash Equivalent
(Cost $25,048).............. 25,048
- ---------------------------------------------------------
REPURCHASE AGREEMENT (0.6%)
J.P. Morgan
5.670%, dated 11/29/96, matures
12/02/96, repurchase price
$3,555,571 (collateralized by
various GNMA obligations
total par value $3,510,583,
8.000%, 11/15/26; total market
value: $3,633,220)............... 3,554 3,554
- ---------------------------------------------------------
Total Repurchase Agreement
(Cost $3,554)............... 3,554
- ---------------------------------------------------------
Total Investments (99.3%)
(Cost $475,535)............. 572,594
- ---------------------------------------------------------
OTHER ASSETS AND LIABILITIES, NET (0.7%) 4,183
- ---------------------------------------------------------
Market
Value
(000)
------
NET ASSETS:
Portfolio Shares of Trust Class
($.001 par value --
1.0 billion shares
authorized) based on
41,332,551 outstanding shares............... $456,860
Portfolio Shares of Investor Class A
($.001 par value -- .25 billion shares
authorized) based
on 1,335,932 outstanding shares.............. 15,307
Portfolio Shares of Investor Class B
($.001 par value -- .25 billion shares
authorized) based
on 381,710 outstanding shares................. 4,666
Undistributed net investment income............. 346
Accumulated net realized gain
on investments................................ 2,539
Net unrealized appreciation
on investments................................ 97,059
- ---------------------------------------------------------
Total Net Assets: (100.0%)................. $576,777
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- TRUST CLASS
($553,648,175 DIVIDE 41,332,551
SHARES OUTSTANDING)............................. $13.39
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- INVESTOR CLASS A
($17,996,840 DIVIDE 1,335,932
SHARES OUTSTANDING)............................. $13.47
- ---------------------------------------------------------
OFFERING PRICE PER SHARE-- INVESTOR CLASS A
($13.47 DIVIDE 95.5%)........................... $14.10
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE - INVESTOR CLASS B (1)
($5,131,493 DIVIDE 381,710
SHARES OUTSTANDING)............................. $13.44
=========================================================
* Non-income producing security.
Cl--Class
(1) Investors Class B has a contingent deferred sales charge. For description of
a possible redemption charge, see the notes to the financial statements.
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
CAPITAL APPRECIATION FUND
Market
Value
Shares (000)
------ ------
COMMON STOCKS (90.6%)
AEROSPACE & DEFENSE (1.3%)
Textron................................ 5,300 $ 505
- ---------------------------------------------------------
BANKS (0.9%)
Chase Manhattan Bank................... 3,700 350
- ---------------------------------------------------------
BUILDING & CONSTRUCTION (0.9%)
Medusa................................. 9,500 329
- ---------------------------------------------------------
COMMUNICATIONS EQUIPMENT (1.3%)
Cascade Communications*................ 7,000 481
- ---------------------------------------------------------
COMPUTERS & SERVICES (16.0%)
BMC Software*.......................... 15,600 679
Cabletron Systems*..................... 15,000 606
Cisco Systems*......................... 6,400 434
Computer Associates International...... 9,400 618
Electronic Data Systems................ 8,000 387
Gateway 2000*.......................... 10,000 536
Hewlett Packard........................ 8,400 453
Intel.................................. 6,200 786
Microsoft*............................. 4,100 643
Seagate Technology*.................... 14,200 561
Storage Technology*.................... 7,000 349
- ---------------------------------------------------------
6,052
- ---------------------------------------------------------
COSMETICS, SOAPS & TOILETRIES (1.3%)
Procter & Gamble....................... 4,500 489
- ---------------------------------------------------------
ELECTRONIC & OTHER ELECTRICAL EQUIPMENT (3.7%)
General Electric....................... 7,700 801
W.W. Grainger.......................... 7,400 588
- ---------------------------------------------------------
1,389
- ---------------------------------------------------------
FINANCIAL SERVICES (2.1%)
American Express....................... 5,200 272
FNMA .................................. 12,600 520
- ---------------------------------------------------------
792
- ---------------------------------------------------------
FOOD, BEVERAGE & TOBACCO (12.5%)
Campbell Soup.......................... 4,100 339
Coca Cola.............................. 9,000 460
ConAgra................................ 9,100 483
Hershey Foods.......................... 10,800 539
Morton International................... 12,600 509
Nabisco Holdings, Cl A................. 10,200 395
Philip Morris.......................... 5,100 526
Quaker Oats............................ 9,000 354
Sara Lee............................... 20,500 805
U.S.T.................................. 10,000 326
- ---------------------------------------------------------
4,736
- ---------------------------------------------------------
FOOTWEAR (1.1%)
Nike, Cl B............................. 7,200 410
- ---------------------------------------------------------
Market
Value
Shares (000)
------ ------
GAS/NATURAL GAS (1.0%)
Enron.................................. 8,200 $ 375
- ---------------------------------------------------------
HOTELS & LODGING (1.2%)
Hilton Hotels.......................... 15,600 456
- ---------------------------------------------------------
INSURANCE (4.7%)
AMBAC.................................. 5,000 342
American Financial..................... 11,000 396
American International Group........... 5,300 610
General RE............................. 2,600 439
- ---------------------------------------------------------
1,787
- ---------------------------------------------------------
MACHINERY (1.4%)
Tyco International..................... 9,500 520
- ---------------------------------------------------------
MANUFACTURING (2.8%)
Illinois Tool Works.................... 5,850 502
Minnesota Mining & Manufacturing....... 6,500 544
- ---------------------------------------------------------
1,046
- ---------------------------------------------------------
MEASURING DEVICES (1.3%)
Thermo Electron*....................... 14,000 508
- ---------------------------------------------------------
MEDICAL PRODUCTS & SERVICES (14.1%)
Abbott Laboratories.................... 8,200 457
Amgen*................................. 8,000 487
Guidant................................ 10,000 529
Johnson & Johnson...................... 8,000 425
Merck.................................. 7,000 581
Pfizer................................. 7,000 627
Schering Plough........................ 5,700 406
Stryker................................ 12,600 365
Tenet Healthcare*...................... 18,500 414
United States Surgical................. 16,000 642
Watson Pharmaceuticals*................ 11,000 426
- ---------------------------------------------------------
5,359
- ---------------------------------------------------------
PAPER & PAPER PRODUCTS (1.5%)
Fort Howard*........................... 20,000 565
- ---------------------------------------------------------
PETROLEUM & FUEL PRODUCTS (3.4%)
Tidewater.............................. 9,000 394
Union Texas Petroleum.................. 19,000 423
Unocal................................. 12,000 489
- ---------------------------------------------------------
1,306
- ---------------------------------------------------------
PHOTOGRAPHIC EQUIPMENT & SUPPLIES (1.1%)
Eastman Kodak.......................... 5,100 413
- ---------------------------------------------------------
PROFESSIONAL SERVICES (1.4%)
Apollo Group, Cl A*.................... 20,000 518
- ---------------------------------------------------------
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
CAPITAL APPRECIATION FUND (concluded)
Shares/
Face Market
Amount Value
(000) (000)
------ ------
RETAIL (8.6%)
Home Depot........................... 8,800 $ 459
McDonald's........................... 8,200 383
PepsiCo.............................. 12,400 370
Sears Roebuck........................ 9,400 468
TJX.................................. 11,500 519
Toys R Us*........................... 17,300 597
Wendy's International................ 21,000 449
- ---------------------------------------------------------
3,245
- ---------------------------------------------------------
STEEL & STEEL WORKS (1.3%)
AK Steel Holding..................... 13,000 496
- ---------------------------------------------------------
TELEPHONES & TELECOMMUNICATION (5.0%)
Airtouch Communications*............. 8,600 220
AT&T................................. 11,700 459
Lucent Technologies.................. 2,916 149
MCI Communications................... 19,300 589
Worldcom*............................ 20,200 467
- ---------------------------------------------------------
1,884
- ---------------------------------------------------------
TRANSPORTATION (0.7%)
Burlington Northern Santa Fe......... 3,100 279
- ---------------------------------------------------------
Total Common Stocks
(Cost $28,667)................ 34,290
- ---------------------------------------------------------
CASH EQUIVALENT (4.4%)
Aim Liquid Assets Portfolio.......... $1,648 1,648
- ---------------------------------------------------------
Total Cash Equivalent
(Cost $1,648)................. 1,648
- ---------------------------------------------------------
REPURCHASE AGREEMENT (3.8%)
J.P. Morgan
5.670%, dated 11/29/96, matures
12/02/96, repurchase price
$1,455,592 (collateralized by
GNMA obligation par value
$1,450,000, 8.000%, 11/15/26;
total market value: $1,500,710)..... 1,455 1,455
- ---------------------------------------------------------
Total Repurchase Agreement
(Cost $1,455).................. 1,455
- ---------------------------------------------------------
Total Investments (98.8%)
(Cost $31,770)................. 37,393
- ---------------------------------------------------------
OTHER ASSETS AND LIABILITIES, NET (1.2%) 460
- ---------------------------------------------------------
Market
Value
(000)
------
NET ASSETS:
Portfolio Shares of Trust Class
($.001 par value - .75 billion shares
authorized) based on
2,428,841 outstanding shares................ $26,592
Portfolio Shares of Investor Class A
($.001 par value - .25 billion shares
authorized) based
on 362,262 outstanding shares............... 3,887
Undistributed net investment income........... 10
Accumulated net realized gain
on investments.............................. 1,741
Net unrealized appreciation
on investments.............................. 5,623
- ---------------------------------------------------------
Total Net Assets: (100.0%)............... $37,853
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- TRUST CLASS
($32,982,855 DIVIDE 2,428,841
SHARES OUTSTANDING)........................... $13.58
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- INVESTOR CLASS A
($4,870,390 DIVIDE 362,262
SHARES OUTSTANDING)........................... $13.44
- ---------------------------------------------------------
OFFERING PRICE PER SHARE-- INVESTOR CLASS A
($13.44 DIVIDE 95.5%)......................... $14.07
=========================================================
* Non-income producing security.
Cl--Class
FNMA--Federal National Mortgage Association
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
SPECIAL EQUITY FUND
Market
Value
Shares (000)
------ ------
COMMON STOCKS (91.6%)
AEROSPACE & DEFENSE (1.3%)
Tracor*.............................. 49,000 $1,072
- ---------------------------------------------------------
AUTOMOTIVE (3.5%)
Arvin Industries..................... 37,000 879
Breed Technologies................... 56,000 1,498
Lear Seating*........................ 15,000 538
- ---------------------------------------------------------
2,915
- ---------------------------------------------------------
BANKS (4.2%)
Central Fidelity Banks............... 30,000 802
Glendale Federal*.................... 76,500 1,606
JSB Financial........................ 13,000 471
SouthTrust........................... 18,500 657
- ---------------------------------------------------------
3,536
- ---------------------------------------------------------
BUILDING & CONSTRUCTION SUPPLIES (0.8%)
Martin Marietta Materials............ 27,000 635
- ---------------------------------------------------------
CHEMICALS (2.0%)
Aceto................................ 28,500 385
Hanna................................ 60,000 1,267
- ---------------------------------------------------------
1,652
- ---------------------------------------------------------
COMMUNICATIONS EQUIPMENT (5.8%)
Boston Technology *.................. 19,000 375
Comverse Technology*................. 48,200 1,627
Dialogic *........................... 23,000 696
Ortel* .............................. 24,000 540
Premisys Communications*............. 13,000 666
Xylan*............................... 25,000 919
- ---------------------------------------------------------
4,823
- ---------------------------------------------------------
COMPUTER SOFTWARE (4.4%)
Pure Atria*.......................... 30,000 825
Raptor Systems*...................... 34,000 748
Rational Software*................... 26,000 897
Structural Dynamics Research *....... 63,500 1,230
- ---------------------------------------------------------
3,700
- ---------------------------------------------------------
COMPUTERS & SERVICES (4.3%)
Auspex Systems*...................... 96,000 1,116
PRI Automation*...................... 23,500 1,093
Storage Technology*.................. 28,000 1,396
- ---------------------------------------------------------
3,605
- ---------------------------------------------------------
DRUGS (1.9%)
Guilford Pharmaceuticals*............ 30,000 487
Watson Pharmaceuticals*.............. 28,000 1,085
- ---------------------------------------------------------
1,572
- ---------------------------------------------------------
Market
Value
Shares (000)
------ ------
ELECTRICAL SERVICES (1.1%)
Central Maine Power.................. 35,000 $ 416
Public Service of New Mexico......... 25,000 478
- ---------------------------------------------------------
894
- ---------------------------------------------------------
ELECTRONIC & OTHER ELECTRICAL EQUIPMENT (3.0%)
DII Group *.......................... 69,000 1,690
SCI Systems*......................... 15,000 791
- ---------------------------------------------------------
2,481
- ---------------------------------------------------------
ENERGY SERVICES (1.8%)
AES*................................. 30,000 1,466
- ---------------------------------------------------------
FINANCIAL SERVICES (3.1%)
A.G. Edwards......................... 15,000 469
Advanta, Cl B........................ 10,000 420
Capital One Financial................ 37,000 1,337
Security Capital Industrial Trust.... 20,100 382
- ---------------------------------------------------------
2,608
- ---------------------------------------------------------
FOOD, BEVERAGE & TOBACCO (1.8%)
Schweitzer-Manduit International...... 45,000 1,485
- ---------------------------------------------------------
GAS/NATURAL GAS (2.2%)
Public Service of North Carolina...... 30,000 570
UGI................................... 25,000 547
USX-Delhi Group....................... 50,000 737
- ---------------------------------------------------------
1,854
- ---------------------------------------------------------
INSURANCE (6.7%)
American Bankers Insurance Group...... 5,000 243
CMAC Investment....................... 16,000 1,220
Life Re............................... 35,000 1,291
Old Republic International............ 45,000 1,221
Penn-American Group................... 20,000 315
USLife................................ 11,250 347
Wellpoint Health Networks*............ 31,000 938
- ---------------------------------------------------------
5,575
- ---------------------------------------------------------
LEASING & RENTING (0.2%)
Renters' Choice*...................... 10,000 182
- ---------------------------------------------------------
MACHINERY (3.7%)
Agco.................................. 61,500 1,714
Titan Wheel International............. 107,000 1,418
- ---------------------------------------------------------
3,132
- ---------------------------------------------------------
MEDICAL PRODUCTS & SERVICES (12.1%)
Advanced Technologies Laboratories*... 46,500 1,325
American Homepatient*................. 51,000 1,160
Haemonetics*.......................... 22,000 382
Life Technologies..................... 45,000 979
Lunar*................................ 38,500 1,194
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
SPECIAL EQUITY FUND (continued)
Market
Value
Shares (000)
------ ------
MEDICAL PRODUCTS & SERVICES (continued)
Respironics*.......................... 35,000 $ 516
Steris*............................... 41,000 1,430
Universal Health Services*............ 46,000 1,300
Vencor*............................... 44,100 1,428
Vital Signs........................... 20,000 437
- ---------------------------------------------------------
10,151
- ---------------------------------------------------------
PAPER & PAPER PRODUCTS (1.9%)
Fort Howard*.......................... 56,000 1,582
- ---------------------------------------------------------
PETROLEUM & FUEL PRODUCTS (4.2%)
Benton Oil & Gas*..................... 20,000 505
Chieftan International*............... 34,000 833
Global Marine *....................... 60,000 1,170
Oceaneering International*............ 60,000 998
- ---------------------------------------------------------
3,506
- ---------------------------------------------------------
PRINTING & PUBLISHING (1.9%)
Golden Books Family Entertainment*... 50,000 569
Meredith............................. 20,000 1,030
- ---------------------------------------------------------
1,599
- ---------------------------------------------------------
PROFESSIONAL SERVICES (2.9%)
Accustaff*........................... 49,000 992
Corestaff*........................... 47,500 1,211
Donnelly Enterprises*................ 10,000 250
- ---------------------------------------------------------
2,453
- ---------------------------------------------------------
RECREATION (2.8%)
Callaway Golf........................ 47,000 1,428
Primadonna Resorts*.................. 49,500 910
- ---------------------------------------------------------
2,338
- ---------------------------------------------------------
RESTAURANTS (1.3%)
Sbarro................................ 43,000 1,123
- ---------------------------------------------------------
RETAIL (4.7%)
Buckle*............................... 36,000 1,017
Dominick's Supermarkets*.............. 4,000 84
S & K Famous Brands*.................. 60,000 540
Stein Mart*........................... 25,000 478
Warnaco Group......................... 21,000 559
Zale*................................. 62,000 1,232
- ---------------------------------------------------------
3,910
- ---------------------------------------------------------
SPECIALTY MACHINERY (0.6%)
Modine Manufacturing.................. 22,000 539
- ---------------------------------------------------------
Shares/
Face Market
Amount Value
(000) (000)
------ ------
STEEL & STEEL WORKS (2.3%)
AK Steel Holding 31,000 $ 1,182
Reliance Steel & Aluminum............. 20,000 750
- ---------------------------------------------------------
1,932
- ---------------------------------------------------------
TELEPHONES & TELECOMMUNICATION (0.9%)
Xpedite Systems *..................... 39,500 721
- ---------------------------------------------------------
TRUCKING (1.5%)
Roadway Express....................... 40,000 645
Werner Enterprises.................... 37,500 600
- ---------------------------------------------------------
1,245
- ---------------------------------------------------------
WHOLESALE (2.7%)
Marshall Industries*.................. 26,000 806
Richfood Holdings, CI A............... 38,250 995
Sterling Electronics*................. 31,500 449
- ---------------------------------------------------------
2,250
- ---------------------------------------------------------
Total Common Stocks
(Cost $63,498)................. 76,536
- ---------------------------------------------------------
CASH EQUIVALENT (4.5%)
Aim Liquid Assets Portfolio........... $3,759 3,759
- ---------------------------------------------------------
Total Cash Equivalent
(Cost $3,759).................. 3,759
- ---------------------------------------------------------
REPURCHASE AGREEMENT (3.3%)
J.P. Morgan
5.670%, dated 11/29/96, matures
12/02/96, repurchase price $2,752,845
(collateralized by various GNMA
obligations total par value
$2,762,035, 8.000%,
03/15/26-11/15/26; total
market value $2,817,079)............. 2,752 2,752
- ---------------------------------------------------------
Total Repurchase Agreement
(Cost $2,752)................... 2,752
- ---------------------------------------------------------
Total Investments (99.4%)
(Cost $70,009).................. 83,047
- ---------------------------------------------------------
OTHER ASSETS AND LIABILITIES, NET (0.6%) 499
- ---------------------------------------------------------
<PAGE>
STATEMENT OF NET ASSETS CRESTFUNDS, INC.
November 30, 1996
- --------------------------------------------------------------------------------
SPECIAL EQUITY FUND (concluded)
Market
Value
(000)
------
NET ASSETS:
Portfolio Shares of Trust Class
($.001 par value -- .75 billion
shares authorized) based on
5,676,613 outstanding shares................. $63,492
Portfolio Shares of Investor Class A
($.001 par value -- .125 billion shares
authorized) based on
339,500 outstanding shares................... 3,875
Portfolio Shares of Investor Class B
($.001 par value -- .125 billion shares
authorized) based on
70,169 outstanding shares..................... 846
Undistributed net investment income............. 16
Accumulated net realized gain
on investments................................ 2,279
Net unrealized appreciation
on investments................................ 13,038
- ---------------------------------------------------------
Total Net Assets: (100.0%) $83,546
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- TRUST CLASS
($77,930,786 divide 5,676,613
SHARES OUTSTANDING)............................. $13.73
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- INVESTOR CLASS A
($4,659,567 DIVIDE 339,500
SHARES OUTSTANDING)............................. $13.72
- ---------------------------------------------------------
OFFERING PRICE PER SHARE-- INVESTOR CLASS A
($13.72 DIVIDE 95.5%)........................... $14.37
- ---------------------------------------------------------
NET ASSET VALUE, OFFERING AND REDEMPTION
PRICE PER SHARE -- INVESTOR CLASS B (1)
(955,402 DIVIDE 70,169 SHARES OUTSTANDING)...... $13.62
=========================================================
* Non-income producing security.
Cl--Class
(1) Investors Class B has a contingent deferred sales charge.
For description of a possible redemption charge, see the
notes to the financial statements.
The accompanying notes are an integral part of the financial statements.
<PAGE>
[THIS PAGE LEFT INTENTIONALLY BLANK]
<PAGE>
STATEMENT OF OPERATIONS CRESTFUNDS, INC.
For the Year Ended November 30, 1996
<TABLE>
<CAPTION>
(IN THOUSANDS)
------------------------------------------------------------------
CASH RESERVE U.S. TREASURY TAX FREE LIMITED TERM INTERMEDIATE
FUND MONEY FUND MONEY FUND BOND FUND BOND FUND
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Interest Income: $31,999 $21,129 $6,492 $5,473 $9,155
- ------------------------------------------------------------------------------------------------------------------------
Expenses:
Investment Advisory Fees......................... 2,315 1,576 732 442 835
Waiver of Investment Advisory Fees............... -- -- -- -- --
Administrative Fees.............................. 829 592 275 133 209
Waiver of Administrative Fees.................... -- -- -- -- --
Custodian/Transfer Agent Fees.................... 472 326 147 80 121
Professional Fees................................ 111 59 28 14 19
Director Fees.................................... 21 15 7 3 4
Registration & Filing Fees....................... 20 11 6 10 22
Insurance Expense................................ 11 7 4 2 1
Distribution Fees--Trust Class................... 787 592 272 130 206
Waiver of Distribution Fees--Trust Class......... (787) (592) (272) (130) (206)
Distribution Fees--Investors Class A............. 214 -- 9 2 3
Waiver of Distribution Fees--Investors Class A... (214) -- (9) (2) (3)
Distribution Fees--Investors Class B............. -- -- -- -- --
Waiver of Distribution Fees--Investors Class B... -- -- -- -- --
Printing Fees.................................... 43 25 10 4 5
Miscellaneous Fees............................... 3 (6) 1 2 9
- ------------------------------------------------------------------------------------------------------------------------
Total Expenses................................. 3,825 2,605 1,210 690 1,225
- ------------------------------------------------------------------------------------------------------------------------
Net Investment Income............................... 28,174 18,524 5,282 4,783 7,930
- ------------------------------------------------------------------------------------------------------------------------
Net Realized Gain (Loss) on Investments 7 -- 392 (555) 524
Change in Net Unrealized Appreciation (Depreciation)
of Investments................................... -- -- -- (476) 1,883
- ------------------------------------------------------------------------------------------------------------------------
Change in Net Realized and Unrealized Gain (Loss)
on Investments................................... 7 -- 392 (1,031) 2,417
- ------------------------------------------------------------------------------------------------------------------------
Increase in Net Assets Resulting
from Operations.................................. 28,181 18,524 5,674 3,752 10,337
========================================================================================================================
</TABLE>
Amounts designated as "--" are either $0 or have been rounded to $0.
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF OPERATIONS CRESTFUNDS, INC.
For the Year Ended November 30, 1996
<TABLE>
<CAPTION>
(IN THOUSANDS)
- ---------------------------------------------------------------------------------------------------------------------------------
VIRGINIA
INTERMEDIATE VIRGINIA MARYLAND CAPITAL SPECIAL
GOVERNMENT MUNICIPAL MUNICIPAL MUNICIPAL VALUE APPRECIATION EQUITY
BOND FUND BOND FUND BOND FUND BOND FUND (1) FUND FUND FUND
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Interest Income:..................... $1,033 $ 4,711 $644 $154 $ 628 $ 86 $ 148
Dividend Income:..................... -- -- -- -- 7,733 328 818
- ---------------------------------------------------------------------------------------------------------------------------------
Expenses:
Investment Advisory Fees.......... 96 461 72 18 2,617 211 506
Waiver of Investment Advisory Fees (16) -- (12) (15) -- -- --
Administrative Fees............... 24 138 18 5 523 42 101
Waiver of Administrative Fees..... (24) -- (18) (5) -- -- --
Custodian/Transfer Agent Fees..... 15 77 11 3 310 26 61
Professional Fees................. 1 16 3 5 52 7 3
Trustee Fees...................... -- 2 -- -- 11 1 2
Registration & Filing Fees........ 11 11 9 7 34 10 15
Insurance Expense................. -- -- -- -- 1 1 1
Distribution Fees--Trust Class.... 23 126 17 5 496 36 93
Waiver of Distribution Fees--
Trust Class..................... (23) (126) (17) (5) (496) (36) (93)
Distribution Fees--Investors Class A -- 13 -- -- 23 6 7
Waiver of Distribution Fees--
Investors Class A............... -- (13) -- -- (23) (6) (7)
Distribution Fees--Investors Class B 5 -- 7 -- 34 -- 8
Waiver of Distribution Fees--
Investors Class B............... (1) -- (1) -- (12) -- (1)
Printing Fees..................... 1 5 1 -- 20 4 3
Miscellaneous Fees................ 3 9 1 4 (6) 8 10
- ---------------------------------------------------------------------------------------------------------------------------------
Total Expenses.................. 115 719 91 22 3,584 310 709
- ---------------------------------------------------------------------------------------------------------------------------------
Net Investment Income........... 918 3,992 553 132 4,777 104 257
- ---------------------------------------------------------------------------------------------------------------------------------
Net Realized Gain (Loss)
on Investments................... (92) 123 -- (25) 16,756 1,899 3,928
Change in Net Unrealized Appreciation
(Depreciation) of Investments.... (155) 7,143 82 45 79,107 4,702 7,966
- ---------------------------------------------------------------------------------------------------------------------------------
Change in Net Realized and Unrealized
Gain (Loss) on Investments....... (247) 7,266 82 20 95,863 6,601 11,894
- ---------------------------------------------------------------------------------------------------------------------------------
Increase in Net Assets Resulting
from Operations ................. 671 11,258 635 152 100,640 6,705 12,151
=================================================================================================================================
</TABLE>
(1) Commenced Operations on March 1, 1996.
Amounts designated as "--" are either $0 or have been rounded to $0.
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS CRESTFUNDS, INC.
For the Year Ended November 30, 1996
<TABLE>
<CAPTION>
(IN THOUSANDS)
-----------------------------------------------------------------------------------------------
CASH RESERVE CASH RESERVE U.S. TREASURY U.S. TREASURY TAX FREE TAX FREE
FUND FUND MONEY FUND MONEY FUND MONEY FUND MONEY FUND
------------ ------------ ------------- ------------- ---------- -----------
12/01/95 12/01/94 12/01/95 12/01/94 12/01/95 12/01/94
TO 11/30/96 TO 11/30/95 TO 11/30/96 TO 11/30/95 TO 11/30/96 TO 11/30/95
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Investment Activities:
Net Investment Income........ $ 28,174 $ 25,680 $ 18,524 $ 16,738 $ 5,282 $ 6,113
Net Realized Gain
(Loss) on Investments........ 7 (14) -- -- 392 --
- ------------------------------------------------------------------------------------------------------------------------------------
Increase in Net Assets Resulting
From Operations................... 28,181 25,666 18,524 16,738 5,674 6,113
- ------------------------------------------------------------------------------------------------------------------------------------
Distribution to Shareholders:
Net Investment Income
Trust Class.................. (25,572) (24,141) (18,524) (16,738) (5,218) (6,063)
Investors Class A............ (2,601) (1,537) -- -- (64) (50)
Investors Class B............ (1) (1) -- -- -- --
Capital Gains
Trust Class.................. -- -- -- -- (380) --
Investors Class A............ -- -- -- -- (4) --
Investors Class B............ -- -- -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Total Distributions........ (28,174) (25,679) (18,524) (16,738) (5,666) (6,113)
- ------------------------------------------------------------------------------------------------------------------------------------
Change in Net Assets.............. 7 (13) -- -- 8 --
- ------------------------------------------------------------------------------------------------------------------------------------
Capital Share Transactions
(All at $1.00 Per Share):
Trust Class:
Shares Issued................ 948,964 922,366 897,803 899,896 275,099 420,904
Shares Issued in Lieu of
Cash Distributions......... 833 815 137 217 -- --
Shares Redeemed.............. (848,850) (780,499) (879,343) (849,136) (295,120) (376,174)
---------- ---------- ---------- ---------- ---------- ----------
Total Trust Class
Transactions............... 100,947 142,682 18,597 50,977 (20,021) 44,730
---------- ---------- ---------- ---------- ---------- ----------
Investor Class A:
Shares Issued................ 74,370 64,444 -- -- 5,955 4,744
Shares Issued in Lieu of
Cash Distributions......... 2,608 1,534 -- -- 69 50
Shares Redeemed.............. (51,807) (37,548) -- -- (4,657) (3,923)
---------- ---------- ---------- ---------- ---------- ----------
Total Investor
Class A Transactions....... 25,171 28,430 -- -- 1,367 871
---------- ---------- ---------- ---------- ---------- ----------
Investor Class B:
Shares Issued................ -- 29 -- -- -- --
Shares Issued in Lieu of
Cash Distributions......... 1 1 -- -- -- --
Shares Redeemed.............. (7) (9) -- -- -- --
---------- ---------- ---------- ---------- ---------- ----------
Total Investor
Class B Transactions...... (6) 21 -- -- -- --
- ------------------------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in
Net Assets from
Capital Share Transactions..... 126,112 171,133 18,597 50,977 (18,654) 45,601
- ------------------------------------------------------------------------------------------------------------------------------------
Total Increase (Decrease)
in Net Assets.............. 126,119 171,120 18,597 50,977 (18,646) 45,601
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets:
Beginning of Period............ 560,446 389,326 370,454 319,477 203,960 158,359
- ------------------------------------------------------------------------------------------------------------------------------------
Net Assets:
End of Period.................. $686,565 $560,446 $389,051 $370,454 $185,314 $203,960
====================================================================================================================================
</TABLE>
Amounts designated as "--" are either $0 or have been rounded to $0.
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS CRESTFUNDS, INC.
For the Year Ended November 30, 1996
<TABLE>
<CAPTION>
(IN THOUSANDS)
- ----------------------------------------------------------------------------------------------------------------------------------
LIMITED TERM LIMITED TERM INTERMEDIATE INTERMEDIATE GOVERNMENT GOVERNMENT
BOND FUND BOND FUND BOND FUND BOND FUND BOND FUND BOND FUND(1)
------------ ------------ ------------ ------------ ---------- -----------
12/01/95 12/01/95 12/01/95 12/01/94 12/01/95 04/05/95
TO 11/30/96 TO 11/30/95 TO 11/30/96 TO 11/30/95 TO 11/30/96 TO 11/30/95
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Investment Activities:
Net Investment Income........ $ 4,783 $ 4,548 $ 7,930 $ 4,613 $ 918 $ 352
Net Realized Gain (Loss)
on Investments............... (555) (145) 524 (668) (92) 93
Change in Net Unrealized
Appreciation (Depreciation)
of Investments............. (476) 4,764 1,883 8,352 (155) 550
- ----------------------------------------------------------------------------------------------------------------------------------
Increase (Decrease) in Net Assets
Resulting From Operations......... 3,752 9,167 10,337 12,297 671 995
- ----------------------------------------------------------------------------------------------------------------------------------
Distribution to Shareholders:
Net Investment Income
Trust Class.................. (4,716) (4,452) (7,848) (4,487) (893) (348)
Investors Class A............ (90) (36) (115) (74) -- --
Investors Class B............ -- -- -- -- (25) (4)
In Excess of Net Investment Income
Trust Class.................. -- -- -- -- -- --
Investors Class A............ -- -- -- -- -- --
Investors Class B............ -- -- -- -- -- --
Capital Gains
Trust Class.................. -- -- -- -- -- (89)
Investors Class A............ -- -- -- -- -- --
Investors Class B............ -- -- -- -- -- (3)
In Excess of Capital Gains
Trust Class.................. -- -- -- -- -- --
Investors Class A............ -- -- -- -- -- --
Investors Class B............ -- -- -- -- -- --
- -----------------------------------------------------------------------------------------------------------------------------------
Total Distributions........ (4,806) (4,488) (7,963) (4,561) (918) (444)
- -----------------------------------------------------------------------------------------------------------------------------------
Change in Net Assets.............. (1,054) 4,679 2,374 7,736 (247) 551
===================================================================================================================================
Capital Share Transactions:
Trust Class:
Shares Issued.................... 30,369 33,357 232,804 29,752 13,571 11,738
Shares Issued in Lieu of
Cash Distributions............. 2,917 3,171 2,198 2,474 42 1
Shares Redeemed.................. (36,075) (35,747) (38,078) (35,110) (3,415) (2,072)
-------- -------- -------- -------- -------- --------
Total Trust Class Transactions (2,789) 781 196,924 (2,884) 10,198 9,667
-------- -------- -------- -------- -------- --------
Investor Class A:
Shares Issued.................... 587 913 758 776 -- --
Shares Issued in Lieu of
Cash Distributions............. 73 29 98 67 -- --
Shares Redeemed.................. (969) (117) (328) (269) -- --
-------- -------- -------- -------- -------- --------
Total Investor Class A Transactions (309) 825 528 574 -- --
-------- -------- -------- -------- -------- --------
Investor Class B:
Shares Issued.................... -- -- -- -- 381 327
Shares Issued in Lieu of
Cash Distributions............. -- -- -- -- 19 5
Shares Redeemed.................. -- -- -- -- (18) (14)
-------- -------- -------- -------- -------- --------
Total Investor Class B Transactions -- -- -- -- 382 318
- -----------------------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in
Net Assets from
Capital Share Transactions....... (3,098) 1,606 197,452 (2,310) 10,580 9,985
- -----------------------------------------------------------------------------------------------------------------------------------
Total Increase (Decrease)
in Net Assets ................... (4,152) 6,285 199,826 5,426 10,333 10,536
- -----------------------------------------------------------------------------------------------------------------------------------
Net Assets:
Beginning of Period.............. 90,247 83,962 83,599 78,173 10,536 --
- -----------------------------------------------------------------------------------------------------------------------------------
Net Assets:
End of Period.................... $86,095 $90,247 $283,425 $83,599 $20,869 $10,536
Shares Issued and Redeemed
Trust Class:
Shares Issued.................... 3,067 3,410 23,858 3,084 1,315 1,155
Shares Issued in Lieu of
Cash Distributions............... 295 324 225 256 4 --
Shares Redeemed.................. (3,652) (3,674) (3,883) (3,671) (332) (198)
-------- -------- -------- -------- -------- --------
Total Trust Class Share
Transactions..................... (290) 60 20,200 (331) 987 957
-------- -------- -------- -------- -------- --------
Investor Class A:
Shares Issued.................... 59 91 78 79 -- --
Shares Issued in Lieu of
Cash Distributions............... 7 4 9 7 -- --
Shares Redeemed.................. (98) (12) (33) (28) -- --
-------- -------- -------- -------- -------- --------
Total Investor Class A Share
Transactions..................... (32) 83 54 58 -- --
-------- -------- -------- -------- -------- --------
Investor Class B:
Shares Issued.................... -- -- -- -- 37 31
Shares Issued in Lieu of
Cash Distributions............... -- -- -- -- 2 1
Shares Redeemed.................. -- -- -- -- (2) (1)
-------- -------- -------- -------- -------- --------
Total Investor Class B
Share Transactions............... -- -- -- -- 37 31
- -----------------------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease)
from Capital Share Transactions 322 143 20,254 (273) 1,024 988
===================================================================================================================================
</TABLE>
(1)Commenced operations on April 5, 1995.
Amounts designated as "--" are either $0 or have been rounded to $0.
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF CHANGES IN NET AS CRESTFUNDS, INC.
For the Year Ended November 30, 1996
<TABLE>
<CAPTION>
(IN THOUSANDS)
-----------------------------------------------------------------
VIRGINIA VIRGINIA
INTERMEDIATE INTERMEDIATE VIRGINIA VIRGINIA MARYLAND
MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL MUNICIPAL
BOND FUND BOND FUND BOND FUND BOND FUND (1) BOND FUND(2)
------------ ------------ --------- ------------- ------------
12/01/95 12/01/94 12/01/95 04/05/95 03/01/96
TO 11/30/96 TO 11/30/95 TO 11/30/96 TO 11/30/95 TO 11/30/96
- ---------------------------------------------------------------------------------------------------------------------------
Investment Activities:
<S> <C> <C> <C> <C> <C>
Net Investment Income........................ $ 3,992 $ 2,163 $ 553 $ 147 $ 132
Net Realized Gain (Loss) on Investments...... 123 (398) -- 30 (25)
Change in Net Unrealized Appreciation
(Depreciation) of Investments.............. 7,143 5,690 82 215 45
- ---------------------------------------------------------------------------------------------------------------------------
Increase in Net Assets Resulting From Operations.. 11,258 7,455 635 392 152
- ---------------------------------------------------------------------------------------------------------------------------
Distribution to Shareholders:
Net Investment Income
Trust Class.................................. (3,639) (1,797) (527) (138) (130)
Investors Class A............................ (349) (364) -- -- --
Investors Class B............................ -- -- (26) (9) (2)
In Excess of Net Investment Income
Trust Class................................. -- -- -- -- --
Investors Class A........................... -- -- -- -- --
Investors Class B........................... -- -- -- -- --
Capital Gains
Trust Class................................. -- -- -- (26) --
Investors Class A........................... -- -- -- -- --
Investors Class B........................... -- -- -- (3) --
In Excess of Capital Gains
Trust Class................................. -- -- -- -- --
Investors Class A........................... -- -- -- -- --
Investors Class B........................... -- -- -- -- --
- ---------------------------------------------------------------------------------------------------------------------------
Total Distributions....................... (3,988) (2,161) (553) (176) (132)
- ---------------------------------------------------------------------------------------------------------------------------
Change in Net Assets............................. 7,270 5,294 82 216 20
===========================================================================================================================
Capital Share Transactions:
Trust Class:
Shares Issued............................... 214,918 14,161 13,472 6,938 6,095
Shares Issued in Lieu of Cash Distributions. 11 29 5 -- 2
Shares Redeemed............................. (22,461) (16,598) (3,895) (891) (306)
-------- -------- -------- ------ ------
Total Trust Class Transactions............ 192,468 (2,408) 9,582 6,047 5,791
-------- -------- -------- ------ ------
Investor Class A:
Shares Issued............................... 1,145 2,323 -- -- --
Shares Issued in Lieu of Cash Distributions. 277 272 -- -- --
Shares Redeemed............................. (1,860) (2,304) -- -- --
-------- -------- -------- ------ ------
Total Investor Class A Transactions....... (438) 291 -- -- --
-------- -------- -------- ------ ------
Investor Class B:
Shares Issued............................... -- -- 359 623 113
Shares Issued in Lieu of Cash Distributions. -- -- 17 7 2
Shares Redeemed............................. -- -- (216) (18) (5)
-------- -------- -------- ------ ------
Total Investor Class B Transactions....... -- -- 160 612 110
- ---------------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets from
Capital Share Transactions.................... 192,030 (2,117) 9,742 6,659 5,901
- ---------------------------------------------------------------------------------------------------------------------------
Total Increase in Net Assets.............. 199,300 3,177 9,824 6,875 5,921
- ---------------------------------------------------------------------------------------------------------------------------
Net Assets:
Beginning of Period........................... 52,022 48,845 6,875 -- --
- ---------------------------------------------------------------------------------------------------------------------------
Net Assets:
End of Period................................. $251,322 $ 52,022 $16,699 $6,875 $5,921
Shares Issued and Redeemed:
Trust Class:
Shares Issued............................... 21,786 1,429 1,331 688 627
Shares Issued in Lieu of Cash Distributions. 1 3 -- -- --
Shares Redeemed............................. (2,225) (1,688) (384) (87) (32)
-------- -------- -------- ------ ------
Total Trust Class Share Transactions...... 19,562 (256) 947 601 595
-------- -------- -------- ------ ------
Investor Class A:
Shares Issued............................... 113 237 -- -- --
Shares Issued in Lieu of Cash Distributions. 27 27 -- -- --
Shares Redeemed............................. (184) (232) -- -- --
-------- -------- -------- ------ ------
Total Investor Class A Share Transactions. (44) 32 -- -- --
-------- -------- -------- ------ ------
Investor Class B:
Shares Issued............................... -- -- 35 61 13
Shares Issued in Lieu of Cash Distributions. -- -- 2 1 --
Shares Redeemed............................. -- -- (21) (2) (1)
-------- -------- -------- ------ ------
Total Investor Class B Share Transactions. -- -- 16 60 12
- ---------------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease) from Capital Share Transactions 19,518 (224) 963 661 607
===========================================================================================================================
<FN>
(1) Commenced operations on April 5, 1995.
(2) Commenced operations on March 1, 1996.
Amounts designated as "--" are either $0 or have been rounded to $0.
</FN>
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
STATEMENT OF CHANGES IN NET ASSETS CRESTFUNDS, INC.
For the Year Ended November 30, 1996
<TABLE>
<CAPTION>
(IN THOUSANDS)
-------------------------------------------------------------------------------
CAPITAL CAPITAL SPECIAL SPECIAL
VALUE VALUE APPRECIATION APPRECIATION EQUITY EQUITY
FUND FUND FUND FUND FUND FUND
---------- ----------- ----------- ---------- ------------ -----------
12/01/95 12/01/94 12/01/95 12/01/94 12/01/95 12/01/94
TO 11/30/96 TO 11/30/95 TO 11/30/96 TO 11/30/95 TO 11/30/96 TO 11/30/95
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Investment Activities:
Net Investment Income.............. $ 4,777 $ 4,379 $ 104 $ 77 $ 257 $ 460
Net Realized Gain (Loss) on Investments 16,756 21,813 1,899 2,611 3,928 (83)
Change in Net Unrealized Appreciation
of investments................... 79,107 24,731 4,702 516 7,966 8,522
- ---------------------------------------------------------------------------------------------------------------------------
Increase in Net Assets Resulting
From Operations......................... 100,640 50,923 6,705 3,204 12,151 8,899
- ---------------------------------------------------------------------------------------------------------------------------
Distribution to Shareholders:
Trust Class........................ (4,346) (4,388) (83) (71) (247) (455)
Investors Class A.................. (199) (228) (14) (10) (19) (38)
Investors Class B.................. (23) (7) -- -- -- (1)
In Excess of Net Investment Income
Trust Class........................ -- -- -- -- -- --
Investors Class A.................. -- -- -- -- -- --
Investors Class B.................. -- -- -- -- -- --
Capital Gains
Trust Class........................ (14,523) (29,441) -- (2,304) (1,429) (1,501)
Investors Class A.................. (743) (1,560) -- (342) (110) (115)
Investors Class B.................. (186) (167) -- -- (21) --
In Excess of Capital Gains
Trust Class........................ -- -- -- -- -- --
Investors Class A.................. -- -- -- -- -- --
Investors Class B.................. -- -- -- -- -- --
- ---------------------------------------------------------------------------------------------------------------------------
Total Distributions.............. (20,020) (35,791) (97) (2,727) (1,826) (2,110)
- ---------------------------------------------------------------------------------------------------------------------------
Change in Net Assets.................... 80,620 15,132 6,608 477 10,325 6,789
===========================================================================================================================
Capital Share Transactions:
Trust Class:
Shares Issued...................... 324,452 63,581 17,305 10,294 29,781 19,004
Shares Issued in Lieu of
Cash Distributions................. 10,467 24,051 8 59 1,316 1,570
Shares Redeemed.................... (79,508) (48,378) (9,622) (4,065) (17,031) (16,202)
-------- -------- -------- -------- -------- --------
Total Trust Class Transactions 255,411 39,254 7,691 6,288 14,066 4,372
-------- -------- -------- -------- -------- --------
Investor Class A:
Shares Issued...................... 4,589 3,958 1,389 1,637 689 1,418
Shares Issued in Lieu of
Cash Distributions................. 931 1,769 14 349 122 152
Shares Redeemed.................... (2,402) (1,979) (702) (275) (1,437) (872)
-------- -------- -------- -------- -------- --------
Total Investor Class A Transactions 3,118 3,748 701 1,711 (626) 698
-------- -------- -------- -------- -------- --------
Investor Class B:
Shares Issued...................... 2,571 2,049 -- -- 367 536
Shares Issued in Lieu of
Cash Distributions................. 207 174 -- -- 21 1
Shares Redeemed.................... (255) (80) -- -- (74) (4)
-------- -------- -------- -------- -------- --------
Total Investor Class B Transactions 2,523 2,143 -- -- 313 533
- ---------------------------------------------------------------------------------------------------------------------------
Net Increase in Net Assets from
Capital Share Transactions........... 261,052 45,145 8,392 7,999 13,753 5,603
- ---------------------------------------------------------------------------------------------------------------------------
Total Increase in Net Assets..... 341,672 60,277 15,000 8,476 24,078 12,392
- ---------------------------------------------------------------------------------------------------------------------------
Net Assets:
Beginning of Period.................. 235,105 174,828 22,853 14,377 59,468 47,076
- ---------------------------------------------------------------------------------------------------------------------------
Net Assets:
End of Period........................ $576,777 $235,105 $37,853 $22,853 $ 83,546 $ 59,468
- ---------------------------------------------------------------------------------------------------------------------------
Shares Issued and Redeemed:
Trust Class:
Shares Issued...................... 27,872 5,580 1,425 896 2,402 1,681
Shares Issued in Lieu of
Cash Distributions................. 848 2,175 1 5 100 153
Shares Redeemed.................... (6,393) (4,287) (799) (364) (1,300) (1,493)
-------- -------- -------- -------- -------- --------
Total Trust Class Share Transactions 22,327 3,468 627 537 1,202 341
-------- -------- -------- -------- -------- --------
Investor Class A:
Shares Issued...................... 369 346 117 146 53 126
Shares Issued in Lieu of Cash
Distributions.................... 75 158 1 33 9 15
Shares Redeemed.................... (192) (173) (59) (26) (110) (79)
-------- -------- -------- -------- -------- --------
Total Investor Class A Share
Transactions..................... 252 331 59 153 (48) 62
-------- -------- -------- -------- -------- --------
Investor Class B:
Shares Issued...................... 205 170 -- -- 28 46
Shares Issued in Lieu of
Cash Distributions............... 17 15 -- -- 2 --
Shares Redeemed.................... (20) (6) -- -- (6) --
-------- -------- -------- -------- -------- --------
Total Investor Class B
Share Transactions............. 202 179 -- -- 24 46
- ---------------------------------------------------------------------------------------------------------------------------
Net Increase from Capital
Share Transactions...................... 22,781 3,978 686 690 1,178 449
===========================================================================================================================
</TABLE>
Amounts designated as "--" are either $0 or have been rounded to $0.
The accompanying notes are an integral part of the financial statements.
<PAGE>
FINANCIAL HIGHLIGHTS CRESTFUNDS, INC.
For a Share Outstanding Throughout the Year
<TABLE>
<CAPTION>
INVESTMENT ACTIVITIES DISTRIBUTIONS
NET -------------------------- ------------------ NET
ASSET NET REALIZED ASSET
VALUE NET AND UNREALIZED NET VALUE,
BEGINNING INVESTMENT GAIN(LOSS) INVESTMENT CAPITAL END
OF PERIOD INCOME ON INVESTMENTS INCOME GAINS OF PERIOD
- -------------------------------------------------------------------------------
- -----------------
CASH RESERVE FUND
- -----------------
<S> <C> <C> <C> <C> <C> <C>
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $1.00 0.049 -- (0.049) -- $1.00
1995 1.00 0.053 -- (0.053) -- 1.00
1994 1.00 0.034 -- (0.034) -- 1.00
1993 1.00 0.027 -- (0.027) -- 1.00
1992 1.00 0.036 -- (0.036) -- 1.00
1991 1.00 0.060 -- (0.060) -- 1.00
INVESTORS CLASS A
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $1.00 0.049 -- (0.049) -- $1.00
1995 1.00 0.053 -- (0.053) -- 1.00
1994 1.00 0.033 -- (0.033) -- 1.00
1993 (1) 1.00 0.014 -- (0.014) -- 1.00
INVESTORS CLASS B (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $1.00 0.040 -- (0.040) -- $1.00
1995 (2) 1.00 0.028 -- (0.028) -- 1.00
- ------------------------
U.S. TREASURY MONEY FUND
- ------------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $1.00 0.047 -- (0.047) -- $1.00
1995 1.00 0.052 -- (0.052) -- 1.00
1994 1.00 0.033 -- (0.033) -- 1.00
1993 1.00 0.025 -- (0.025) -- 1.00
1992 1.00 0.034 -- (0.034) -- 1.00
1991 1.00 0.058 -- (0.058) -- 1.00
INVESTORS CLASS A (+)
FOR THE YEARS ENDED NOVEMBER 30,:
1994 1.00 0.008 -- (0.008) -- 1.00
1993 1.00 0.003 -- (0.003) -- 1.00
- -------------------
TAX-FREE MONEY FUND
- -------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $1.00 0.029 0.002 (0.029) (0.002) $1.00
1995 1.00 0.032 -- (0.032) -- 1.00
1994 1.00 0.021 -- (0.021) -- 1.00
1993 1.00 0.019 -- (0.019) -- 1.00
1992 1.00 0.031 -- (0.031) -- 1.00
1991 1.00 0.046 -- (0.046) -- 1.00
INVESTORS CLASS A
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $1.00 0.029 0.002 (0.029) (0.002) $1.00
1995 1.00 0.031 -- (0.031) -- 1.00
1994 1.00 0.020 -- (0.020) -- 1.00
1993 (3) 1.00 0.009 -- (0.009) -- 1.00
</TABLE>
(TABLE CONTINUED)
FINANCIAL HIGHLIGHTS CRESTFUNDS, INC.
For a Share Outstanding Throughout the Year
<TABLE>
<CAPTION>
RATIO OF
RATIO NET INVESTMENT
NET OF EXPENSES RATIO OF INCOME TO
ASSETS, RATIO TO AVERAGE NET INVESTMENT AVERAGE
END OF EXPENSES NET ASSETS INCOME NET ASSETS PORTFOLIO
TOTAL OF PERIOD TO AVERAGE EXCLUDING TO AVERAGE EXCLUDING TURNOVER
RETURN (000) NET ASSETS FEE WAIVERS NET ASSETS FEE WAIVERS RATE
- ----------------------------------------------------------------------------------------------------
- -----------------
CASH RESERVE FUND
- -----------------
<S> <C> <C> <C> <C> <C> <C> <C>
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 4.98% 621,139 0.66% 0.81% 4.87% 4.72% --
1995 5.45% 520,185 0.66% 0.81% 5.31% 5.16% --
1994 3.46% 377,493 0.66% 0.66% 3.37% 3.37% --
1993 2.76% 408,036 0.66% 0.66% 2.75% 2.75% --
1992 3.66% 496,847 0.61% 0.61% 3.50% 3.50% --
1991 6.17% 396,534 0.51% 0.58% 6.00% 5.93% --
INVESTORS CLASS A
FOR THE YEARS ENDED NOVEMBER 30,:
1996 4.97% 65,411 0.67% 1.07% 4.85% 4.45% --
1995 5.44% 40,240 0.67% 1.07% 5.31% 4.91% --
1994 3.36% 11,832 0.68% 0.97% 3.35% 3.06% --
1993(1) 1.49%* 73 1.16%* 13.00%* 2.25%* (14.09%)* --
INVESTORS CLASS B(**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 4.08% 15 1.52% 1.67% 4.02% 3.87% --
1995(2) 2.82%* 21 1.52%* 1.67%* 4.45%* 4.30%* --
- ------------------------
U.S. TREASURY MONEY FUND
- ------------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 4.80% 389,051 0.66% 0.81% 4.69% 4.54% --
1995 5.29% 370,454 0.66% 0.81% 5.16% 5.01% --
1994 3.30% 319,477 0.66% 0.66% 3.23% 3.23% --
1993 2.51% 342,537 0.66% 0.66% 2.52% 2.52% --
1992 3.55% 482,881 0.64% 0.65% 3.37% 3.36% --
1991 6.00% 279,790 0.56% 0.62% 5.61% 5.55% --
INVESTORS CLASS A (dagger)
FOR THE YEARS ENDED NOVEMBER 30,:
1994 0.79% -- 0.92%* 29.16%* 2.31%* (25.93%)* --
1993 0.34% 17 1.16%* 36.60%* 2.02%* (33.42%)* --
- -------------------
TAX-FREE MONEY FUND
- -------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 3.14% 182,320 0.66% 0.81% 2.88% 2.73% --
1995 3.26% 202,333 0.66% 0.81% 3.19% 3.04% --
1994 2.07% 157,602 0.67% 0.67% 2.06% 2.06% --
1993 1.88% 142,284 0.66% 0.66% 1.85% 1.85% --
1992 3.03% 155,458 0.47% 0.62% 3.00% 2.85% --
1991 4.72% 166,670 0.27% 0.70% 4.39% 3.96% --
1996 3.13% 2,994 0.67% 1.07% 2.86% 2.46% --
1995 3.25% 1,627 0.67% 1.07% 3.16% 2.76% --
1994 1.98% 757 0.76% 1.44% 1.97% 1.29% --
1993(3) 0.88%* 228 1.16%* 3.00%* 1.35%* (0.49%)* --
</TABLE>
<PAGE>
Amounts designated as "--" are either $0 or have been rounded to $0.
(1) Commencement of operations for this class May 4, 1993.
(2) Commencement of operations for this class April 19, 1995.
(3) Commencement of operations for this class May 5, 1993.
(dagger) Ceased operations March 31, 1994.
* Annualized.
** Total return does not reflect the sales charge or redemption charge, where
applicable.
The accompanying notes are an integral part of the financial statements.
FINANCIAL HIGHLIGHTS CRESTFUNDS, INC.
For a Share Outstanding Throughout the Year
INVESTMENT ACTIVITIES DISTRIBUTIONS
NET ------------------------ ------------------ NET
ASSET NET REALIZED ASSET
VALUE, NET AND UNREALIZED NET VALUE,
BEGINNING INVESTMENT GAIN(LOSS) INVESTMENT CAPITAL END
OF PERIOD INCOME ON INVESTMENTS INCOME GAINS OF PERIOD
- --------------------------------------------------------------------------------
- ----------------------
LIMITED TERM BOND FUND
- ----------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $10.03 0.534 (0.097) (0.537) -- $ 9.93
1995 9.49 0.532 0.534 (0.526) -- 10.03
1994 10.16 0.480 (0.640) (0.480) (0.030) 9.49
1993 9.81 0.500 0.350 (0.500) -- 10.16
1992 (4) 10.00 0.070 (0.190) (0.070) -- 9.81
INVESTORS CLASS A (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $10.06 0.535 (0.109) (0.536) -- $ 9.95
1995 9.50 0.530 0.556 (0.526) -- 10.06
1994 10.17 0.480 (0.650) (0.470) (0.030) 9.50
1993 (5) 10.11 0.260 0.060 (0.260) -- 10.17
- ----------------------
INTERMEDIATE BOND FUND
- ----------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $10.12 0.550 (0.175) (0.555) -- $ 9.94
1995 9.16 0.569 0.954 (0.563) -- 10.12
1994 10.20 0.530 (1.000) (0.530) (0.040) 9.16
1993 9.70 0.520 0.500 (0.520) -- 10.20
1992 (4) 10.00 0.080 (0.300) (0.080) -- 9.70
INVESTORS CLASS A (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $10.12 0.543 (0.169) (0.554) -- $ 9.94
1995 9.16 0.572 0.951 (0.563) -- 10.12
1994 10.19 0.520 (0.990) (0.520) (0.040) 9.16
1993 (6) 10.20 0.290 (0.010) -- (0.290) 10.19
- --------------------
GOVERNMENT BOND FUND
- --------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $10.66 0.591 (0.290) (0.591) -- $10.37
1995(7) 10.00 0.412 0.753 (0.412) (0.093) 10.66
INVESTORS CLASS B (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $10.68 0.503 (0.291) (0.502) -- $10.39
1995(8) 10.03 0.338 0.738 (0.333) (0.093) 10.68
<TABLE>
<CAPTION>
RATIO OF
RATIO NET INVESTMENT
NET OF EXPENSES RATIO OF INCOME TO
ASSETS, RATIO TO AVERAGE NET INVESTMENT AVERAGE
END OF EXPENSES NET ASSETS INCOME NET ASSETS PORTFOLIO
TOTAL OF PERIOD TO AVERAGE EXCLUDING TO AVERAGE EXCLUDING TURNOVER
RETURN (000) NET ASSETS FEE WAIVERS NET ASSETS FEE WAIVERS RATE
- -----------------------------------------------------------------------------------------------
- ----------------------
LIMITED TERM BOND FUND
- ----------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
<S> <C> <C> <C> <C> <C> <C> <C>
1996 4.52% 84,973 0.78% 0.93% 5.41% 5.26% 51%
1995 11.50% 88,789 0.78% 0.93% 5.44% 5.29% 36%
1994 (1.56%) 83,369 0.76% 0.76% 4.92% 4.92% 47%
1993 8.84% 85,968 0.77% 0.77% 4.95% 4.95% 61%
1992 (4) (1.22%) 72,590 1.04%* 1.04%* 4.46%* 4.46%* 2%
INVESTORS CLASS A (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 4.40% 1,122 0.79% 0.94% 5.39% 5.24% 51%
1995 11.70% 1,458 0.79% 0.94% 5.46% 5.31% 36%
1994 (1.72%) 593 0.77% 1.03% 4.92% 4.66% 47%
1993 (5) 3.16%* 427 1.02%* 1.48%* 4.70%* 4.24%* 61%
- ----------------------
INTERMEDIATE BOND FUND
- ----------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 3.92% 281,187 0.88% 1.03% 5.70% 5.55% 35%
1995 17.07 81,870 0.88% 1.03% 5.89% 5.74% 37%
1994 (4.72%) 77,143 0.88% 0.88% 5.53% 5.53% 39%
1993 10.69% 58,487 0.90% 0.90% 5.15% 5.15% 28%
1992 (4) (2.20%)* 13,759 1.15%* 1.15%* 4.63%* 4.63%* 0%
INVESTORS CLASS A (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 3.91% 2,238 0.89% 1.04% 5.54% 5.39% 35%
1995 17.08% 1,729 0.89% 1.04% 5.87% 5.72% 37%
1994 (4.72%) 1,030 0.89% 1.05% 5.51% 5.35% 39%
1993 (6) 2.72%* 618 1.15%* 1.58%* 4.90%* 4.47%* 28%
- --------------------
GOVERNMENT BOND FUND
- --------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 3.02% 20,171 0.69% 1.09% 5.75% 5.35% 16%
1995(7) 11.85%* 10,211 0.71%* 1.11%* 6.00%* 5.60%* 28%
INVESTORS CLASS B (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 2.12% 698 1.55% 1.95% 4.89% 4.49% 16%
1995(8) 10.86%* 325 1.55%* 1.95%* 5.05%* 4.65%* 28%
<FN>
Amounts designated as "--" are either $0 or have been rounded to $0.
(4) Commencement of operations for this class September 28, 1992.
(5) Commencement of operations for this class May 19, 1993.
(6) Commencement of operations for this class May 11, 1993.
(7) Commencement of operations for this class April 5, 1995.
(8) Commencement of operations for this class April 19, 1995.
* Annualized.
** Total return does not reflect the sales charge or redemption charge, where
applicable.
</FN>
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
FINANCIAL HIGHLIGHTS CRESTFUNDS, INC.
For a Share Outstanding Throughout the Year
INVESTMENT ACTIVITIES DISTRIBUTIONS
NET ---------------------- ------------------ NET
ASSET NET REALIZED ASSET
VALUE, NET AND UNREALIZED NET VALUE,
BEGINNING INVESTMENT GAIN(LOSS) INVESTMENT CAPITAL END
OF PERIOD INCOME ON INVESTMENTS INCOME GAINS OF PERIOD
- --------------------------------------------------------------------------------
- -----------------------------------------
VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND
- -----------------------------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $10.24 0.419 (0.021) (0.418) -- $10.22
1995 9.21 0.428 1.030 (0.428) -- 10.24
1994 10.33 0.440 (1.100) (0.440) (0.020) 9.21
1993 (9) 10.00 0.390 0.330 (0.390) -- 10.33
INVESTORS CLASS A (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $10.23 0.415 (0.018) (0.417) -- $10.21
1995 9.20 0.428 1.029 (0.427) -- 10.23
1994 10.32 0.440 (1.100) (0.440) (0.020) 9.20
1993 (3) 10.22 0.260 0.100 (0.260) -- 10.32
- ----------------------------
VIRGINIA MUNICIPAL BOND FUND
- ----------------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $10.40 0.465 (0.120) (0.465) -- $10.28
1995(7) 10.00 0.309 0.445 (0.310) (0.044) 10.40
INVESTORS CLASS B (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $10.43 0.378 (0.121) (0.377) -- $10.31
1995(10) 10.06 0.237 0.409 (0.232) (0.044) 10.43
- ----------------------------
MARYLAND MUNICIPAL BOND FUND
- ----------------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996(12) $10.00 0.309 (0.240) (0.309) -- $ 9.76
INVESTORS CLASS B (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996(13) $ 9.53 0.200 0.226 (0.196) -- $ 9.76
- ----------
VALUE FUND
- ----------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $11.60 0.166 2.380 (0.165) (0.591) $13.39
1995 10.73 0.245 2.619 (0.262) (1.732) 11.60
1994 11.38 0.200 (0.240) (0.190) (0.420) 10.73
1993 10.50 0.180 0.870 (0.170) -- 11.38
1992 (4) 10.00 0.030 0.500 (0.030) -- 10.50
INVESTORS CLASS A (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $11.66 0.168 2.396 (0.164) (0.5910) $13.47
1995 10.78 0.250 2.623 (0.261) (1.732) 11.66
1994 11.42 0.180 (0.220) (0.180) (0.420) 10.78
1993 (11) 11.06 0.060 0.350 (0.050) -- 11.42
INVESTORS CLASS B (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $11.64 0.091 2.384 (0.084) (0.591) $13.44
1995 (7) 11.11 0.120 1.618 (0.136) (1.072) 11.64
<TABLE>
<CAPTION>
RATIO OF
RATIO NET INVESTMENT
NET OF EXPENSES RATIO OF INCOME TO
ASSETS, RATIO TO AVERAGE NET INVESTMENT AVERAGE
END OF EXPENSES NET ASSETS INCOME NET ASSETS PORTFOLIO Average
TOTAL OF PERIOD TO AVERAGE EXCLUDING TO AVERAGE EXCLUDING TURNOVER Commission
RETURN (000) NET ASSETS FEE WAIVERS NET ASSETS FEE WAIVERS RATE Rate(A)
- -------------------------------------------------------------------------------------------------------------
- -----------------------------------------
VIRGINIA INTERMEDIATE MUNICIPAL BOND FUND
- -----------------------------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1996 4.01% 243,137 0.78% 0.93% 4.35% 4.20% 25% n/a
1995 16.09% 43,373 0.72% 0.94% 4.34% 4.12% 28% n/a
1994 (6.53%) 41,365 0.65% 0.77% 4.48% 4.36% 24% n/a
1993(9) 7.25%* 39,392 0.71%* 0.85%* 4.25%* 4.11%* 39% n/a
INVESTORS CLASS A (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 4.01% 8,185 0.79% 0.94% 4.12% 3.97% 25% n/a
1995 16.10% 8,649 0.73% 0.95% 4.33% 4.11% 28% n/a
1994 (6.56%) 7,481 0.66% 0.80% 4.47% 4.33% 24% n/a
1993(3) (3.53%)* 4,805 0.66%* 0.90%* 4.27%* 4.03%* 39% n/a
- ----------------------------
VIRGINIA MUNICIPAL BOND FUND
- ----------------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 3.48% 15,911 0.71% 1.11% 4.61% 4.21% 24% n/a
1995(7) 7.67%* 6,247 0.71%* 1.11%* 4.61%* 4.21%* 35% n/a
INVESTORS CLASS B (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 2.58% 787 1.57% 1.97% 3.73% 3.33% 24% n/a
1995(10) 6.51%* 628 1.57%* 1.97%* 3.76%* 3.36%* 35% n/a
- ----------------------------
MARYLAND MUNICIPAL BOND FUND
- ----------------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996(12) 1.07%* 5,808 0.71%* 1.36%* 4.30%* 3.65%* 9% n/a
INVESTORS CLASS B (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996(13) 7.67%* 113 1.55%* 2.20%* 3.42%* 2.77%* 9% n/a
- ----------
VALUE FUND
- ----------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 22.68% 553,648 1.02% 1.17% 1.38% 1.23% 82% $.0548
1995 28.76% 220,386 1.02% 1.17% 2.16% 2.01% 175% n/a
1994 (0.49%) 166,713 1.01% 1.01% 1.82% 1.82% 116% n/a
1993 10.05% 167,337 1.03% 1.03% 1.64% 1.64% 77% n/a
1992(4) 5.30%* 82,944 1.28%* 1.28%* 1.74%* 1.74%* 5% n/a
INVESTORS CLASS A (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 22.63% 17,997 1.03% 1.18% 1.35% 1.20% 82% $.0548
1995 28.71% 12,633 1.03% 1.18% 2.14% 1.99% 175% n/a
1994 (0.45%) 8,115 1.02% 1.04% 1.81% 1.79% 116% n/a
1993(11) 3.71%* 4,058 1.16%* 1.16%* 1.51%* 1.51%* 77% n/a
INVESTORS CLASS B (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 21.81% 5,131 1.68% 2.03% 0.71% 0.36% 82% $.0548
1995(7) 15.78%* 2,086 1.68%* 2.03%* 1.13%* 0.78%* 175% n/a
<FN>
Amounts designated as "--" are either $0 or have been rounded to $0.
(A) Average commission rate paid per share for the security purchases and sales
made during the period. Presentation of the rate is only required for fiscal
years beginning after September 1, 1995.
(3) Commencement of operations for this class May 5, 1993.
(4) Commencement of operations for this class September 28, 1992.
(7) Commencement of operations for this class April 5, 1995.
(9) Commencement of operations for this class January 11, 1993.
(10) Commencement of operations for this class April 17, 1995.
(11) Commencement of operations for this class May 7, 1993.
(12) Commencement of operations for this class March 1, 1996.
(13) Commencement of operations for this class April 25, 1996.
* Annualized.
** Total return does not reflect the sales charge or redemption charge, where applicable.
The accompanying notes are an integral part of the financial statements.
</FN>
</TABLE>
<PAGE>
FINANCIAL HIGHLIGHTS CRESTFUNDS, INC.
For a Share Outstanding Throughout the Year
INVESTMENT ACTIVITIES DISTRIBUTIONS
NET ---------------------- ------------------ NET
ASSET NET REALIZED ASSET
VALUE, NET AND UNREALIZED NET VALUE,
BEGINNING INVESTMENT GAIN(LOSS) INVESTMENT CAPITAL END
OF PERIOD INCOME ON INVESTMENTS INCOME GAINS OF PERIOD
- --------------------------------------------------------------------------------
- --------------------------
CAPITAL APPRECIATION FUND
- --------------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $10.87 0.043 2.710 (0.042) -- $13.58
1995 10.17 0.043 2.035 (0.046) (1.332) 10.87
1994 9.79 0.010 0.380 (0.010) -- 10.17
1993(9) 10.00 0.010 (0.210) (0.010) -- 9.79
INVESTORS CLASS A (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $10.76 0.043 2.678 (0.040) -- $13.44
1995 10.08 0.044 2.013 (0.045) (1,332) 10.76
1994 9.74 0.010 0.340 (0.010) -- 10.08
1993(10) 9.42 -- 0.320 -- -- 9.74
- -------------------
SPECIAL EQUITY FUND
- -------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $12.12 0.050 1.925 (0.053) (0.313) $13.73
1995 10.56 0.100 1.928 (0.108) (0.360) 12.12
1994 12.76 0.030 (0.460) (0.020) (1.750) 10.56
1993 11.19 0.010 1.560 -- -- 12.76
1992(4) 10.00 0.010 1.180 -- -- 11.19
INVESTORS CLASS A (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $12.12 0.052 1.911 (0.050) (0.313) $13.72
1995 10.56 0.100 1.927 (0.107) (0.360) 12.12
1994 12.76 0.030 (0.460) (0.020) (1.750) 10.56
1993(3) 11.69 -- 1.070 -- -- 12.76
INVESTORS CLASS B (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 $12.08 (0.043) 1.898 (0.003) (0.313) $13.62
1995(7) 10.61 0.007 1.501 (0.038) -- 12.08
<TABLE>
<CAPTION>
RATIO OF
RATIO NET INVESTMENT
NET OF EXPENSES RATIO OF INCOME TO
ASSETS, RATIO TO AVERAGE NET INVESTMENT AVERAGE
END OF EXPENSES NET ASSETS INCOME NET ASSETS PORTFOLIO Average
TOTAL OF PERIOD TO AVERAGE EXCLUDING TO AVERAGE EXCLUDING TURNOVER Commission
RETURN (000) NET ASSETS FEE WAIVERS NET ASSETS FEE WAIVERS RATE Rate(A)
- -------------------------------------------------------------------------------------------------------------
- --------------------------
CAPITAL APPRECIATION FUND
- --------------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1996 25.38% 32,983 1.10% 1.25% 0.37% 0.22% 86% $.0764
1995 20.74% 19,592 1.10% 1.25% 0.40% 0.25% 470% n/a
1994 4.13% 12,869 1.05% 1.05% 0.17% 0.17% 271% n/a
1993(9) (2.00%)* 7,741 1.11%* 1.11%* 0.20%* 0.20%* 133% n/a
INVESTORS CLASS A (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 25.34% 4,870 1.11% 1.26% 0.36% 0.21% 86% $.0764
1995 20.72% 3,261 1.11% 1.26% 0.39% 0.24% 470% n/a
1994 3.70% 1,509 1.06% 1.18% 0.16% 0.04% 271% n/a
1993(10) 3.40%* 649 1.36%* 1.80%* (0.05%)* (0.49%)* 133% n/a
- -------------------
SPECIAL EQUITY FUND
- -------------------
TRUST CLASS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 16.44% 77,931 1.04% 1.19% 0.39% 0.24% 98% $.0620
1995 20.07% 54,221 1.04% 1.19% 0.90% 0.75% 81% n/a
1994 (4.74%) 43,640 1.03% 1.03% 0.32% 0.32% 117% n/a
1993 14.07% 32,706 1.03% 1.03% 0.06% 0.06% 95% n/a
1992(4) 11.90%* 21,925 1.28%* 1.28%* 0.23%* 0.23%* 3% n/a
INVESTORS CLASS A (**)
FOR THE YEARS ENDED NOVEMBER 30,:
1996 16.34% 4,660 1.05% 1.20% 0.40% 0.25% 98% $.0620
1995 20.06% 4,693 1.05% 1.20% 0.89% 0.74% 81% n/a
1994 (4.76%) 3,436 1.04% 1.10% 0.31% 0.25% 117% n/a
1993(3) 9.19%* 938 1.28%* 1.61%* (0.19%)* (0.52%)* 95% n/a
INVESTORS
FOR THE YEARS ENDED NOVEMBER 30,:
1996 15.47% 955 1.90% 2.05% (0.47%) (0.62%) 98% $.0620
1995(7) 14.22%* 554 1.90%* 2.05%* (0.04%)* (0.19%)* 81% n/a
<FN>
Amounts designated as "--" are either $0 or have been rounded to $0.
(A) Average commission rate paid per share for the security purchases and sales
made during the period. Presentation of the rate is only required for fiscal
years beginning after September 1, 1995.
(3) Commencement of operations for this class May 5, 1993.
(4) Commencement of operations for this class September 28, 1992.
(7) Commencement of operations for this class April 5, 1995.
(9) Commencement of operations for this class January 11, 1993.
(10)Commencement of operations for this class May 7, 1993.
* Annualized.
** Total return does not reflect the sales charge or redemption charge, where applicable.
</FN>
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
NOTES TO FINANCIAL STATEMENTS CRESTFUNDS, INC.
November 30, 1996
1. ORGANIZATION
CrestFunds, Inc. (the Company) is registered under the Investment Company Act of
1940 ( the "1940 Act"), as amended, as an open-end, management investment
company organized as a Maryland corporation. The Company currently has twelve
investment portfolios (individually a Fund and collectively the "Funds"). The
Funds offer one or more of three classes of shares, the Trust Class Shares, the
Investors Class A Shares and the Investors Class B Shares. The Funds include:
EQUITY FUNDS
Value Fund
Special Equity Fund
Capital Appreciation Fund
BOND FUNDS
Limited Term Bond Fund
Intermediate Bond Fund
Virginia Intermediate Municipal Bond Fund
Virginia Municipal Bond Fund
Government Bond Fund
Maryland Municipal Bond Fund
MONEY MARKET FUNDS
Cash Reserve Fund
U.S. Treasury Money Fund
Tax Free Money Fund
The Funds' prospectus provides a description of each Funds' investment
objectives, policies and strategies.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by the
Funds:
SECURITY VALUATION--Investment securities held by the Money Market Funds
are stated at amortized cost, which approximates market value. Under this
valuation method, purchase discount and premiums are accreted and amortized
ratably to maturity and are included in interest income.
Investments in equity securities held by the Non-Money Market Funds which
are traded on a national securities exchange (or reported on the NASDAQ
national market system) are stated at the last quoted sale price if readily
available for each equity securities on each business day; other equity
securities traded in the over-the-counter markets and listed equity
securities for which no sale was reported on that date are stated at the
last quoted bid price. Debt obligations exceeding sixty days to maturity
for which market quotations are readily available are valued at the most
recent quoted bid price. Debt obligations with sixty days or less remaining
until maturity may be valued at their amortized cost. Restricted securities
for which quotations are not readily available are valued at fair value
using methods determined in good faith under general supervision of the
Funds' Directors.
FEDERAL INCOME TAXES--It is each Fund's intention to continue to qualify as
a regulated investment company for Federal income tax purposes and
distribute all of its taxable income and net capital gains. Accordingly, no
provision for Federal income taxes is required.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS--Distribution from net
investment income for the Money Market Funds and Bond Funds are declared
daily and paid monthly. Each of the Equity Funds declare and pay dividends
from net investment income monthly. Any net realized capital gains will be
distributed at least annually for all Funds. Dividends and distributions
are determined in accordance with income tax regulations which may differ
from generally accepted accounting principles. These differences are
primarily due to differing treatments for deferral of wash sales losses and
post October losses.
CLASSES--Class specific expenses are borne by that class. Income, non-class
specific expenses and realized/unrealized gains and losses are allocated to
the respective classes on the basis of the relative daily net assets.
SECURITY TRANSACTIONS AND INVESTMENT INCOME--Security transactions are
accounted for on the date the security is purchased or sold (trade date).
Costs used in determining realized gains and losses on the sale of
investment securities are those of the specific securities sold adjusted
for the accretion and amortization of purchase discounts and premiums
during the respective holding periods. Interest income is recorded on the
accrual basis; dividend income is recorded on the ex-dividend date.
REPURCHASE AGREEMENTS--Each Fund, with the exception of Tax Free Money
Fund, Virginia Intermediate Municipal Bond Fund, Virginia Municipal Bond
Fund, and Maryland Municipal Bond Fund may invest in repurchase agreements.
The Funds, through their sub-custodian, receive delivery of the underlying
securities, whose market value including interest is required to be at
least 102% of the resale price. The Funds' investment advisor, Capitoline
Investment Services Incorporated, is responsible for determining that
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued) CRESTFUNDS, INC.
November 30, 1996
the value of these underlying securities remains at least 102% of the
resale price. If the seller defaults, the Fund would suffer a loss to the
extent that the proceeds from the sale of the underlying securities were
less than the resale price.
USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS--The Financial
Statements have been prepared in conformity with generally accepted
accounting principles which permit management to make certain estimates and
assumptions at the date of the financial statements.
3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
MANAGEMENT FEES--The Company's investment advisor is Capitoline Investment
Services Incorporated (the Advisor), a wholly owned subsidiary of Crestar
Bank. Pursuant to an Investment Advisory Agreement, the Advisor is paid for
advisory services to each Fund at the annual rate based on the following
fee schedule; Cash Reserve Fund, U.S. Treasury Money Fund and Tax Free
Money Fund; .40% of each Fund's average daily net assets for the first $500
million of net assets; .35% of each Fund's average daily net assets on the
next $500 million of net assets; .30% of each Fund's average daily net
assets on all remaining net assets; Capital Appreciation Fund, Value Fund
and Special Equity Fund; .75% of each Fund's average daily net assets;
Limited Term Bond Fund and Virginia Intermediate Municipal Bond Fund; .50%
of each Fund's average daily net assets; Intermediate Bond Fund, Government
Bond Fund, Maryland Municipal Bond Fund and Virginia Municipal Bond Fund;
.60% of each Fund's average daily net assets. The Advisor has voluntarily
agreed to waive a portion of its fee for Virginia Municipal Bond Fund and
Government Bond Fund in order to limit Advisory Fee to .50% for each Fund.
In addition, the Advisor has voluntarily agreed to waive a portion of its
fee to limit advisory fee to .10% for the Maryland Municipal Bond Fund.
ADMINISTRATION AND DISTRIBUTION FEES--SEI Fund Resources (the
Administrator), a Delaware business trust, serves as administrator to the
Company. SEI Financial Management Corporation, a wholly-owned subsidiary of
SEI Corporation, is the owner of all beneficial interest in the
Administrator. The Administrator provides the Company with administrative
services, including fund accounting, and regulatory reporting and is
entitled to receive a fee at an annual rate of .15% of the average daily
net assets of the Funds. The Administrator has voluntarily agreed to waive
a portion of its fee for Government Bond Fund, Virginia Municipal Bond Fund
and Maryland Municipal Bond Fund in order to limit operating expenses.
SEI Financial Services Company (the Distributor), a wholly-owned subsidiary
of SEI Corporation, serves as distributor of each Fund's shares pursuant to
a distribution agreement with the Company. The Trust Class and Investors
Class A shares of the Funds have a separate distribution plan (the 12b-1
Plan) pursuant to Rule 12b-1 under the 1940 Act. As provided in the 12b-1
Plan, the Trust Class and Investors Class A shares of the Funds pay the
Distributor as compensation for its services .15% of the aggregate average
daily net assets of such classes of the Funds. The Distributor has agreed
to waive any fees payable pursuant to the 12b-1 Plan.
In addition, the Investors Class A shares of the Money Market Funds have a
distribution plan (the Investors Class A Plan) pursuant to Rule 12b-1 under
the 1940 Act. As provided in the Investors Class A Plan, the Investors
Class A shares of the Money Market Funds pay the Distributor as
compensation for its services .25% of such Class average daily net assets.
The distributor has agreed to waive any fees payable pursuant to the
Investors Class A Plan.
The Investors Class B shares of the Funds have a distribution plan (the B
Shares Plan) pursuant to Rule 12b-1 under the 1940 Act. As provided in the
B Shares Plan, the Investors Class B shares of the Funds pay the
Distributor as compensation for its services .75% of the aggregate average
daily net assets of such class of the Funds. In addition, pursuant to the B
Share Plan, the Distributor is compensated at an annual rate of .25% of the
B shares' average net assets for providing ongoing Shareholder support
services to investors in B shares. The Distributor has agreed to waive a
portion of its fees pursuant to the B Shares Plan in order to limit
Distribution Fees to .85% for each Fund, except for the Value Fund for
which the limit is .65%.
TRANSFER AGENT AND CUSTODIAN FEES--Crestar Bank serves as the Company's
transfer agent and dividend disbursing agent and is compensated for those
services monthly by each Fund at an annual rate of .05% of the Fund's
average daily net assets for the Trust Class and .06% of the Fund's average
daily net assets for the Investors Class A and Investors Class B. In
addition, Crestar Bank serves
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued) CRESTFUNDS, INC.
November 30, 1996
as the Company's custodian and is compensated at an annual rate of up to
.04% of each Fund's average daily net assets.
CONTINGENT DEFERRED SALES CHARGE (CDSC)-- A CDSC is imposed on certain
redemptions of Investors Class B shares. The CDSC varies depending on the
number of years from the time of payment for the purchase of Investors
Class B shares until the redemption of such shares.
CONTINGENT
FROM DATE OF DEFERRED SALES
PURCHASE CHARGE
------------- --------------------
Year 1 5.00%
Year 2 4.00%
Year 3 3.00%
Year 4 3.00%
Year 5 2.00%
Year 6 1.00%
Year 7 0.00%
Year 8 Conversion to A shares
4. INVESTMENT TRANSACTIONS
The cost of security purchases and the proceeds from the sale of securities,
including U.S. Government securities, other than temporary cash investments,
during the period ended November 30, 1996, for each Fund is as follows:
PURCHASE SALES
(000) (000)
-------- --------
Limited Term Bond $ 41,409 $ 40,371
Intermediate Bond 238,738 46,789
Government Bond 12,509 2,376
Virginia Intermediate Municipal Bond 215,105 23,954
Virginia Municipal Bond 13,033 2,753
Maryland Municipal Bond 6,008 363
Value 510,778 280,829
Capital Appreciation 28,918 23,255
Special Equity 78,685 64,060
At November 30, 1996, the total cost of securities and the net realized gains or
losses on securities sold for Federal income tax purposes was not materially
different from amounts reported for financial reporting purposes. The aggregate
gross unrealized appreciation and depreciation on securities at November 30,
1996, for each Fund is as follows:
<PAGE>
NET
APPRECIATION DEPRECIATION APPRECIATION/DEPRECIATION
(000) (000) (000)
---------- ---------- ------------------------
Limited Term Bond $ 734 $ 240 $ 494
Intermediate Bond 6,967 1,392 5,575
Government Bond 432 37 395
Virginia Intermediate
Municipal Bond 8,168 460 7,708
Virginia Municipal
Bond 340 43 297
Maryland Municipal
Bond 73 28 45
Value 104,594 7,535 97,059
Capital Appreciation 5,886 263 5,623
Special Equity 14,369 1,331 13,038
Subsequent to October 31, 1996, the Funds recognized net capital losses for tax
purposes that have been deferred to 1997 and can be used to offset future
capital gains at November 30, 1997. The Funds also had capital losses
carryforward at November 30, 1996, to the extent provided in the regulations for
Federal income tax as follows:
CAPITAL LOSS
CARRYOVER
11/30/96 EXPIRES 2000 EXPIRES 2001
------------ -------------- --------------
Cash Reserve $ 78,711 $ -- $ --
Limited Term Bond 1,594,093 -- --
Intermediate Bond 1,949,930 -- --
Government Bond 93,079 -- --
Virginia Intermediate
Municipal Bond 820,439 -- --
Maryland Municipal Bond 25,459 -- --
POST 10/31/96
EXPIRES EXPIRES EXPIRES DEFERRED
2002 2003 2004 LOSSES
---------- ------------ ------------ ----------------
Cash Reserve $ 64,350 $ 14,361 $ -- $ --
Limited Term Bond 784,783 254,023 555,287 --
Intermediate Bond 1,282,277 667,656 -- --
Government Bond -- -- 93,079 --
Virginia Intermediate
Municipal Bond 422,394 398,042 -- --
Virginia Municipal
Bond -- -- -- 11,672
Maryland Municipal
Bond -- -- 25,459 --
<PAGE>
NOTES TO FINANCIAL STATEMENTS (continued) CRESTFUNDS, INC.
November 30, 1996
5. CONCENTRATION OF CREDIT RISK
The Virginia Intermediate Municipal Bond Fund, the Virginia Municipal Bond Fund,
and the Maryland Municipal Bond Fund invest in debt securities in their
respective states. The ability of the issuers of the securities held by the
Funds to meet their obligations may be affected by economic or political
conditions in that state.
6. AFFILIATED TRANSACTIONS:
On September 20, 1996, the assets of Crestar Bank's Common Trust Funds: the
SouthEast Equity, Value, Tax Exempt and Bond Funds, consisting entirely of
securities and certain related receivables, were converted on a tax-free basis
into the Special Equity, Value, Virginia Intermediate Bond and Intermediate Bond
Funds, respectively. The number of shares issued for each fund and the net
assets of each fund (including net unrealized gain/loss) immediately before the
conversion were as follows:
UNREALIZED
COMMON TRUST FUND ASSETS GAIN/(LOSS)
- -------------------- -------------- ----------------
SouthEast Equities $ 11,962,678 $ 1,839,279
Value 198,034,029 19,525,691
Tax Exempt 188,792,454 3,213,456
Bond 156,399,438 (1,355,800)
MUTUAL FUNDS NET ASSETS SHARES ISSUED
- -------------------- -------------- ----------------------
Special Equity $ 59,964,348 $ 904,208.452
Value 333,187,057 16,022,170.650
Virgina Intermediate
Municipal Bond 67,497,327 18,879,245.360
Intermediate Bond 118,798,561 16,257,737.881
The Net Asset value of shares issued in exchange for the assets and number of
shares in the tax-free conversions are included in capital share transactions
and shares issued and redeemed, respectively, of the Trust Class in the
Statement of Changes in Net Assets for each respective fund.
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR THE
GENERAL INFORMATION OF THE SHAREHOLDERS OF THE COMPANY. THE REPORT IS NOT
AUTHORIZED FOR DISTRIBUTION TO PROSPECTIVE INVESTORS IN THE COMPANY, UNLESS
PRECEDED OR ACCOMPANIED BY AN EFFECTIVE PROSPECTUS. NEITHER THE COMPANY NOR SEI
FINANCIAL SERVICES COMPANY IS A BANK AND COMPANY SHARES ARE NOT OBLIGATIONS OF
OR GUARANTEED BY ANY BANK OR INSURED BY THE FDIC, THE FEDERAL RESERVE BOARD OR
ANY OTHER AGENCY. INVESTING IN MUTUAL FUNDS INVOLVES RISKS, INCLUDING THE
POSSIBLE LOSS OF PRINCIPAL AMOUNT INVESTED. AN INVESTMENT IN A MONEY MARKET FUND
IS NEITHER INSURED NOR GUARANTEED BY THE U.S. GOVERNMENT, AND THERE CAN BE NO
ASSURANCE THAT A MONEY MARKET FUND WILL MAINTAIN A STABLE $1.00 SHARE PRICE. SEI
FINANCIAL SERVICES COMPANY AND CRESTAR BANK ARE NOT AFFILIATED.
- --------------------------------------------------------------------------------
<PAGE>
INDEPENDENT AUDITORS' REPORT
- --------------------------------------------------------------------------------
The Shareholders and Board of Directors of CrestFunds, Inc.:
We have audited the accompanying statements of net assets of CrestFunds, Inc.
(comprised of the Cash Reserve Fund, U.S. Treasury Money Fund, Tax Free Money
Fund, Limited Term Bond Fund, Intermediate Bond Fund, Government Bond Fund,
Virginia Intermediate Municipal Bond Fund, Virginia Municipal Bond Fund,
Maryland Municipal Bond Fund, Value Fund, Capital Appreciation Fund and Special
Equity Fund) as of November 30, 1996 and the related statements of operations
and of changes in net assets and the financial highlights for each of the
periods presented. These financial statements and financial highlights are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
November 30, 1996 by correspondence with the custodian and brokers; where
replies were not received from brokers, we performed other auditing procedures.
An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of each of the
portfolios constituting the CrestFunds, Inc. as of November 30, 1996, the
results of their operations, the changes in their net assets and the financial
highlights for the periods presented in conformity with generally accepted
accounting principles.
DELOITTE & TOUCHE LLP
New York, New York
January 13, 1997
<PAGE>
NOTICE TO SHAREHOLDERS OF
THE CRESTFUNDS, INC.
(Unaudited)
For Shareholders that do not have a November 30, 1996 taxable year end, this
notice is for informational purposes only. For shareholders with a November 30,
1996 taxable year end, please consult your tax advisor as to the pertinence of
the notice.
For the fiscal year ended November 30, 1996, each fund has designated the
following items with regard to distributions paid during the year:
(A) (B) (C)
LONG TERM ORDINARY (A+B)
CAPITAL GAINS INCOME TOTAL
DISTRIBUTIONS DISTRIBUTIONS DISTRIBUTION
FUND (TAX BASIS) (TAX BASIS) (TAX BASIS)
---- ----------- ----------- ----------
Cash Reserve........................ 0% 100% 100%
U.S. Treasury....................... 0% 100% 100%
Tax Free Money Market............... 0% 100% 100%
Limited Term Bond................... 0% 100% 100%
Intermediate Bond................... 0% 100% 100%
Government Bond..................... 0% 100% 100%
Virginia Intermediate Municipal Bond 0% 100% 100%
Virginia Municipal Bond............. 0% 100% 100%
Maryland Municipal Bond............. 0% 100% 100%
Value............................... 37% 63% 100%
Capital Appreciation................ 0% 100% 100%
Special Equity...................... 84% 16% 100%
(D) (E) (F)
QUALIFYING TAX EXEMPT FOREIGN
FUND DIVIDENDS (1) INTEREST TAX CREDIT
---- ----------- ----------- ----------
Cash Reserve........................ 0% 0% 0%
U.S. Treasury....................... 0% 0% 0%
Tax Free Money Market............... 0% 93% 0%
Limited Term Bond................... 0% 0% 0%
Intermediate Bond................... 0% 0% 0%
Government Bond..................... 0% 0% 0%
Virginia Intermediate Municipal Bond 0% 99% 0%
Virginia Municipal Bond............. 0% 100% 0%
Maryland Municipal Bond............. 0% 100% 0%
Value............................... 54% 0% 0%
Capital Appreciation................ 100% 0% 0%
Special Equity...................... 100% 0% 0%
(1) Qualifying dividends represent dividends which qualify for the corporate
dividends received deduction. * Items (A) and (B) are based on a percentage
of each fund's total distributions.
** Items (D) and (E) are based on a percentage of ordinary income distributions
of each fund.
The accompanying notes are an integral part of the financial statements.
