<PAGE>
Chase Funds(Service Mark). Invest With Power.
Annual Report for:
Chase Income Fund
Chase Intermediate Term Bond Fund
Chase Money Market Fund
Chase Short-Intermediate Term
U.S. Government Securities Fund
Chase U.S. Government Securities Fund
December 31, 1998
[LOGO]
Chase Funds(Service Mark)
(Copyright) The Chase Manhattan Corporation, 1999. All Rights Reserved.
February 1999 (C-465-01617) CF804-3-299
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Table of Contents
Chairman's Letter 3
Chase Funds Risks/Rewards 4
Chase Funds Shareholder Services 5
Fund Commentary and Portfolio of Investments
Chase Income Fund 6-11
Chase Intermediate Term Bond Fund 12-18
Chase Money Market Fund 20-26
Chase Short-Intermediate Term
U.S. Government Securities Fund 28-33
Chase U.S. Government Securities Fund 34-38
Statement of Assets and Liabilities 39
Statement of Operations 40
Statement of Changes in Net Assets 41
Notes to Financial Statements 42-47
Financial Highlights 48-52
<PAGE>
Chase Fixed Income Funds
Chairman's Letter
February 8, 1999
Dear Fellow Shareholders:
We are pleased to present this annual report for the Chase Fixed Income Funds
for the year ended December 31, 1998. In providing you with this information, we
seek to assist you in fully understanding how your fund performed and the
strategies your fund managers pursued within the context of the overall economic
and market environment.
Benchmark Treasury Yield Falls
Long-term interest rates, as measured by the yield on the 30-year U.S.
Treasury Bond, fell from 5.92% on January 1, 1998 to 5.09% on December 31, 1998.
This bullish performance reflected several key factors, including:
o the continued absence of inflationary pressures
o the Federal budget surplus and its positive effect on market supply
o a preference for the highest-quality securities given global market concerns
o a continuation of the long-term trend of falling rates
Shorter-term interest rates also fell over the course of the year, with the
yield on two-year Treasuries declining from 5.64% on January 1 to 4.53% on
December 31.
Federal Reserve Board Reduces Short-Term Rates
After leaving the Federal Funds rate unchanged since March, 1997, the Federal
Reserve Board made three .25% rate cuts in the fall, including an extraordinary
cut between meetings of the Federal Open Markets Committee. The Federal Funds
rate is the rate charged to banks for overnight borrowing.
In the view of many market participants, these cuts were made to ensure that
the U.S. economy could weather the global economic slowdown and to provide
support to shaky markets around the world.
The Year of the Treasury
While the year was a positive one for the bond markets, it should be noted
that corporate and mortgage-backed securities did not match the performance of
U.S. Treasury securities. In fact, yields on these "spread" sectors moved to
much higher-than-normal levels relative to Treasuries during October. For much
of the year, mortgage-backed securities suffered from concerns that falling
rates would bring on higher prepayment levels. However, by year end, spreads had
narrowed somewhat as the Fed rate cuts helped corporate securities rally and the
fixed income market as a whole moved into a trading range.
In 1998, the Chase Fixed Income Funds performed well, delivering on the goal
of providing high current income with an emphasis on capital preservation
through investment in high quality securities. All of us at Chase Funds thank
you for your confidence in our investment management team and encourage you to
continue to maintain your investing discipline in the months and years ahead.
Sincerely,
/s/ Sarah E. Jones
Sarah E. Jones
3
<PAGE>
Chase Funds
Risks/Rewards
HIGHEST RISK / RETURN
| Small Company Funds
| Diversified International Stock Funds
| Growth Funds
| Growth & Income Funds
| Equity Income Funds
| Balanced Funds
| Long-Term Bond Funds
| Intermediate-Term Bond Funds
| Short-Term Bond Funds
| Money Market Funds
LOWEST RISK / RETURN
CONSIDER YOUR INVESTMENT
RISK
& YOUR OVERALL RETURN
4
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Chase Funds
Shareholder Services
Telephone Exchange Privilege
Investors wishing to make a change within their Chase Funds accounts may do so
quickly and easily via telephone. This service allows you to respond to changes
in your goals and needs immediately without the burdensome paperwork and lengthy
delays often associated with selling one investment then purchasing another. The
sale of shares from one Chase Fund and purchase of shares in another is
simultaneous with Telephone Exchange.
Automatic Reinvestment
Dividends and capital gains earned in your Chase Funds account can either be
paid to you on a regular basis or automatically reinvested into your account to
purchase additional shares of the same fund. This service is particularly
valuable to growth-oriented investors who do not require current income from
their invested principal. The reinvested dividends compound over time, enhancing
returns and generating additional long-term growth potential.
Systematic Investing*
After opening a Chase Funds account you can make regular investments through
automatic, periodic deductions from your bank checking or savings account.
Shareholders using this service benefit not only by accumulating investment
assets but also through the process of "dollar cost averaging." Dollar cost
averaging is an investment strategy that has shown that investing the same
amount of money on a regular basis in a fluctuating value investment over time
results in a lower actual price paid per share than the average price per share
over time. That is because when the share price is lower, more shares are
purchased and when it is higher, fewer are purchased. Dollar cost averaging is
highly recommended by investment experts as a prudent and highly effective
approach to wealth accumulation.
Systematic Withdrawal
For investors who require an income stream from their Chase Fund(s) investment
account(s), regularly scheduled withdrawals of a specified value of $50 or more
can be sent to them by check on a monthly, quarterly or semi-annual basis.
Check Writing Privilege
The Chase Money Market Fund offers investors the option of accessing account
assets quickly and easily simply by writing a check to redeem shares.
Chase Funds Website
Shareholders of the Chase Funds have unlimited access to their accounts and
first class Chase Funds customer service via the internet at:
http://www.chasefunds.com
Please note, these services are available to all shareholders investing directly
into any Chase Fund. If you purchase these funds through a financial
intermediary, please check with your service provider to determine availability
of these services.
* Systematic investing does not assure a profit and does not protect against
loss in declining financial markets. An investor should be prepared to
continue the program of investing at regular intervals, even during economic
down turns.
5
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Chase Income Fund
as of December 31, 1998
(unaudited)
How the Fund Performed
Chase Income Fund (Premier Shares) had a total return of 9.47% for the year
ended December 31, 1998. This compares to 7.31% for the Lipper Corporate Debt A
Rated Funds Index and 9.47% for the Lehman Government/Corporate Index.
How the Fund Was Managed
At the end of 1997, the manager implemented a strategy that strongly
overweighted longer-term Treasury securities given the belief that low inflation
and lower Treasury issuance due to the Federal budget surplus would spark a
strong rally in the sector. This strategy was reinforced by the manager's belief
that corporate yields were narrow relative to Treasuries given the economic
clouds from Asia as well as concerns about mortgage pre-payments in a rallying
market environment.
While the overall bullish approach began to be realized in the first half of
1998, it was fully validated in the third quarter when Treasuries sharply
outperformed other major sectors. An additional factor supporting performance
throughout much of the first nine months of the year was the Fund's
longer-than-benchmark duration.
With the strong Treasury performance, yields on corporate and mortgage-backed
securities widened dramatically, leading the manager to favor corporates by late
September, and effectively cut duration by reducing exposure to Treasuries. This
adjustment was slightly negative to performance in October, positive in November
and neutral in December. The Fund ended the year modestly overweight in
corporates and with a neutral weighting in Treasuries versus the Lehman
Government/Corporate Index, and only a modest exposure to mortgage-backed
securities.
Where the Fund May Be Headed
Moving into the new year, the management team expected to continue to add
corporate securities and maintain a slightly-long duration given its long-term
bullish view on interest rates. However, the strategy calls for staying close to
the index until there are clearer signs on global conditions, the strength of
the domestic economy and the outlook for Fed policy.
6
<PAGE>
Chase Income Fund
as of December 31, 1998
(unaudited)
Fund Facts
Objective Current income
Primary Investments Bonds, notes and debentures
issued by corporations, the
U.S. government and its
agencies
Suggested investment time frame Long-term
Market benchmark Lehman Government/
Corporate Index
Lipper Funds Universe Corporate Debt A Rated
Funds Index
Inception date Premier Shares 3/29/88
Investor Shares 11/10/98
Newspaper symbol Income
Dividend Frequency Daily
Net Assets Premier Shares $60,068,000
Investor Shares $10,000
Average Maturity 9.7 years
Average Duration 6.1 years
Average Quality AAA
Average Maturity/Quality
- ----------------
| |////| | Large
| |////| |
- ----------------
| | | | Med
| | | |
- ----------------
| | | | Low
| | | |
- ----------------
Short Int. Long
7
<PAGE>
Chase Income Fund
as of December 31, 1998
(unaudited)
10-Year Performance*
This chart shows what the long-term growth would have been for a hypothetical
investment in the Chase Income Fund compared to its key benchmarks. This is
where you can see the Fund's long-term trend.
This chart is for illustrative purposes only.
[LINE GRAPH]
Chase Income Fund Lipper Corporate Debt A
Year Chase Income Fund Rated Fund Inc Lehman Gov't/Corp. Index
10000 10000 10000
10105.9 10101.9 10110.5
10779.5 10845.7 10923.0
10683.3 10931.7 11025.5
1989 11039.5 11250.9 11423.4
10866.2 11083.0 11292.7
11212.7 11455.0 11699.4
11241.6 11417.0 11770.2
1990 11761.3 11999.0 12369.8
11915.3 12380.3 12703.1
12011.5 12573.2 12895.1
12694.9 13347.2 13636.8
1991 13378.3 14075.0 14364.5
12993.3 13880.1 14148.9
13570.7 14553.7 14722.0
14148.2 15163.8 15441.3
1992 14071.2 15156.0 15453.5
14764.2 15907.9 16172.0
15120.3 16412.3 16657.5
15591.9 17009.2 17208.5
1993 15514.9 16959.2 17158.2
14975.9 16341.8 16621.0
14687.2 16036.8 16414.3
14754.6 16075.4 16495.5
1994 14802.7 16124.2 15556.2
15476.4 16931.3 17381.2
16313.8 18069.8 18509.0
16631.4 18428.5 18863.2
1995 17526.5 19319.2 19742.0
17045.2 18817.8 19280.2
17170.4 18865.6 19370.8
17391.7 19210.6 19712.6
1996 17863.3 19857.2 20315.1
17661.2 19857.2 20315.1
17661.2 19682.3 20139.9
18277.2 20417.7 20872.7
18902.8 21163.6 21604.2
1997 19425.4 21765.3 22297.4
19717.4 22069.6 22635.3
20268.6 22610.1 23227.5
21257.4 23325.3 24377.9
1998 21273.0 23356.5 24409.7
Average Annual Total Returns
This table shows the average annual total returns. This is where you can see the
Fund's short-term performance, which, as with the securities markets, tends to
be more volatile than the long-term trend.
1 Year 3 Years 5 Years 10 Years
Premier Shares 9.47% 6.64% 6.52% 7.83%
Investor Shares 9.38% 6.61% 6.50% 7.82%
* Source: Lipper Analytical Services. Past performance is no guarantee of future
results. Investment returns and principal value will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost.
The Fund is currently waiving certain fees. The voluntary waiver may be modified
or terminated at any time, which would reduce performance.
This chart represents the comparative performance for $10,000 invested in
Premier Shares of Chase Income Fund, the Lehman Government/Corporate Index and
the Lipper Corporate Debt A Rated Funds Index from December 31, 1988 to December
31, 1998. The performance of the Fund assumes the reinvestment of all dividends
and capital gains and does not include a sales charge. The performance of the
indices does not include a sales charge and has been adjusted to reflect the
reinvestment of all dividends and capital gains on the securities included in
the benchmark. Premier Shares carry a $1 million minimum initial investment and
carry no sales charge.
Investor Shares were introduced on 11/10/98 and have a minimum initial
investment of $2,500. Please note internal expenses are greater for the Investor
Shares class. Performance measurements for the Investor Shares prior to 11/10/98
are based on the predecessor Premier Shares class and do not include Investor
Share class expenses.
Chase Income Fund is the successor to the AVESTA Trust Income Fund. Effective
12/31/97, the AVESTA Trust was converted from a Texas Trust to Mutual Fund
Investment ("MFIT"), a Massachusetts business trust. As part of the conversion,
the Fund transferred all of its assets to Chase Income Fund, a new investment
portfolio of MFIT.
Chase Income Fund, unlike the AVESTA Income Fund, is subject to certain
diversification, distribution and other requirements imposed under the Internal
Revenue Code, which may impact performance.
The Lipper Corporate Debt A Rated Funds Index represents performance of the
largest 30 A rated corporate debt funds. Lipper is an independent mutual fund
performance monitor whose results are based on total return and do not reflect a
sales charge. An individual cannot invest directly in an index.
The Lehman Govt/Corp. Index includes the Government and Corporate Bond Indices,
including U.S. Government Treasury and agency securities, corporate and yankee
bonds. The index is unmanaged and reflects the reinvestment of dividends. An
individual cannot invest directly in an index.
8
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Chase Income Fund
as of December 31, 1998
(unaudited)
How Much of the Fund Was Invested
[PIE CHART]
Investments 98.5%
Cash/Other 1.5%
What the Fund Was Invested In
Percentage of Total Portfolio Investments
[PIE CHART]
Corporate Notes & Bonds 36.7%
Asset Backed Securities 3.7%
Cash Equivalents & Short Term Paper 6.8%
U.S. Treasury Securities 45.4%
Residential Mortgage Backed Securities 7.4%
9
<PAGE>
Chase Income Fund
Portfolio of Investments December 31, 1998
Principal
Amount
USD Issuer Value
- --------------------------------------------------------------------------------
Long-Term Investments -- 92.1%
- --------------------------------------------------------------------------------
U.S. Treasury Securities -- 44.9%
---------------------------------
U.S. Treasury Notes & Bonds,
$3,800,000 5.50%, 01/31/03 $ 3,912,214
2,460,000 5.75%, 08/15/03 2,568,781
5,825,000 6.25%, 08/15/23 6,510,370
4,715,000 6.25%, 02/15/07 5,171,742
4,100,000 6.38%, 03/31/01 4,249,896
3,500,000 7.63%, 11/15/22 4,536,875
-----------
Total U.S. Treasury Securities
(Cost $26,711,598) 26,949,878
-----------
Corporate Notes & Bonds -- 36.2%
--------------------------------
Automotive -- 1.7%
1,000,000 Ford Motor Credit Co., 6.25%, 12/08/05 1,032,910
-----------
Banking -- 3.4%
2,000,000 BankAmerica Corp., 6.20%, 02/15/06 2,056,840
-----------
Chemicals -- 3.6%
2,200,000 Monsanto Co., #5.88%, 12/01/08 2,179,672
-----------
Consumer Products -- 3.0%
1,725,000 Procter & Gamble Co., 6.45%, 01/15/26 1,810,319
-----------
Financial Services -- 4.1%
2,400,000 Associates Corp. of North America, 7.52%, 03/29/00 2,461,632
-----------
Food / Beverage Products -- 4.4%
2,500,000 Anheuser-Busch Companies, Inc., 6.75%, 08/01/03 2,654,050
-----------
Health Care / Health Care Services -- 4.1%
2,400,000 Abbott Laboratories, 5.60%, 10/01/03 2,441,328
-----------
Machinery -- 4.1%
2,400,000 Caterpillar Financial Services, Inc., 6.95%, 11/01/00 2,465,448
-----------
Restaurants -- 3.6%
2,000,000 McDonald's Corp., 7.05%, 11/15/25 2,162,680
-----------
Retailing -- 4.2%
2,400,000 Wal-Mart Stores, Inc., 6.75%, 05/15/02 2,520,672
-----------
Total Corporate Notes & Bonds
(Cost $20,532,865) 21,785,551
-----------
See notes to financial statements.
10
<PAGE>
Chase Income Fund
Portfolio of Investments December 31, 1998 (continued)
Principal
Amount
USD Issuer Value
- --------------------------------------------------------------------------------
Long-Term Investments -- (continued)
- --------------------------------------------------------------------------------
Mortgage-Backed Pass Through Securities -- 7.3%
-----------------------------------------------
$2,029,231 Federal National Mortgage Association,
Pool 313166, 6.50%, 09/01/26 $ 2,043,172
2,307,840 Government Mortgage Association Corp.,
Pool 416156, 6.50%, 02/15/26 2,331,634
-----------
Total Mortgage-Backed Pass Through Securities
(Cost $4,212,804) 4,374,806
-----------
Asset Backed Securities -- 3.7%
-------------------------------
400,259 Ford Credit Grantor Trust, Ser. 1995-B, Class A,
5.90%, 10/15/00 400,506
1,782,195 PNC Student Loan Trust I, Ser. 1997-2, Class A2,
6.14%, 01/25/00 1,811,708
-----------
Total Asset Backed Securities
(Cost $2,182,436) 2,212,214
-----------
Total Long-Term Investments
(Cost $53,639,703) 55,322,449
- --------------------------------------------------------------------------------
Shares Issuer Value
- --------------------------------------------------------------------------------
Short-Term Investments -- 6.7%
- --------------------------------------------------------------------------------
Money Market Fund -- 3.8%
-------------------------
2,288,300 Fidelity Colchester Street Trust Government Fund
(Cost $2,288,300) 2,288,300
-----------
Principal
Amount
USD
Repurchase Agreement -- 2.9%
----------------------------
$1,746,000 Credit Suisse First Boston (secured by Federal
National Mortgage Association Pools), in a joint
trading account at 5.10%, dated 12/31/98, due
01/04/99; Proceeds $1,746,989
(Cost $1,746,000) 1,746,000
-----------
Total Short-Term Investments
(Cost $4,034,300) 4,034,300
- --------------------------------------------------------------------------------
Total Investments -- 98.8%
(Cost $57,674,003) $59,356,749
- --------------------------------------------------------------------------------
Index
# Security may only be sold to qualified institutional buyers.
See notes to financial statements.
11
<PAGE>
Chase Intermediate Term
Bond Fund
as of December 31, 1998
(unaudited)
How the Fund Performed
Chase Intermediate Term Bond Fund (Premier Shares) had a total return of 7.63%
for the year ended December 31, 1998. This compares to 7.87% for the Lipper
Intermediate Investment Grade Debt Funds Index, 8.69% for the Lehman Aggregate
Index and 8.44% for the Lehman Intermediate Government/Corporate Index.
How the Fund Was Managed
Early in 1998, a lessening of concern over the Asian crises impact on the credit
ratings of corporations helped the Fund's high-quality corporate securities to
perform strongly. In the second quarter, intermediate-term interest rates
declined modestly while long-term interest rates fell sharply, a development
which made the intermediate-term securities in which the Fund invests
particularly attractive to investors. Also in the second quarter, the Fund
benefited from the manager's avoidance of lower-rated corporates when concerns
over Asia and its impact on earnings flared up again.
Although the Fund was slightly underweighted in soaring Treasury securities in
the third quarter, it managed to outperform its benchmark due to strong security
selection in the corporate and mortgage-backed sectors and its focus on
maturities under five years. The mortgage and high quality corporate overweights
were maintained in the under five year maturity area through the fourth quarter,
but the management team replaced two-year mortgages with eight-year issues given
the high yield spreads.
Where the Fund May Be Headed
Moving into the new year, the management team expected to continue to add
corporate securities while keeping duration relatively neutral until there are
clearer signs on global conditions, the strength of the domestic economy and the
outlook for Fed policy. A specific concern is that rates could temporarily move
higher in the first quarter of 1999, particularly in the two-to-five year
portion of the yield curve. With liquidity returning to the market, the Fund may
invest in additional BBB corporates given high quality spreads.
12
<PAGE>
Chase Intermediate Term
Bond Fund
as of December 31, 1998
(unaudited)
Fund Facts
Objective Current income
Primary Investments Intermediate-term, investment-
grade bonds, notes and debentures
issued by corporations, the U.S.
government and its agencies
Suggested investment time frame Mid- to long-term
Market benchmark Lehman Aggregate Index
Lehman Intermediate Govt./Corp. Index
Lipper Funds Universe Intermediate Investment Grade Debt
Funds Index
Inception date Premier Shares 10/3/94
Investor Shares 11/10/98
Newspaper symbol Not Listed
Dividend Frequency Daily
Net Assets Premier Shares $32,870,000
Investor Shares $10,000
Average Maturity 7.7 years
Average Duration 4.6 years
Average Quality AAA
Average Maturity/Quality
- ----------------
| |////| | High
| |////| |
- ----------------
| | | | Med
| | | |
- ----------------
| | | | Low
| | | |
- ----------------
Short Int. Long
13
<PAGE>
Chase Intermediate Term
Bond Fund
as of December 31, 1998
(unaudited)
Life of Fund Performance*
This chart shows what the long-term growth would have been of a hypothetical
investment in the Chase Intermediate Term Bond Fund compared to its key
benchmarks. This is where you can see the Fund's long-term trend. This chart is
for illustrative purposes only.
[LINE GRAPH]
Lipper
Chase Intermediate Lehman Lehman
Intermediate Grade Debt Funds Aggregate Intermediate
Year Term Bond Fund Index Index Govt./Corp. Index
10000 10000 10000 10000
9969.91 9973.04 9977.79 9996.28
1994 10020.1 10021.8 10046.7 9992.56
10180.1 10021.8 10046.7 9988.84
10180.5 10191.3 10245.5 10134.6
10421.3 10407.0 10489.1 10280.3
10471.4 10475.7 10553.5 10426.0
10601.8 10612.5 10700.9 10599.6
10993.0 10985.5 11115.0 10773.3
11103.3 11054.8 11196.5 10946.9
11053.2 11030.4 11171.5 11007.0
11123.4 11159.5 11306.3 11067.1
11253.8 11265.4 11416.3 11127.2
11404.2 11413.1 11564.8 11257.4
11514.5 11582.6 11738.0 11387.5
1995 11705.1 11737.3 11902.8 11517.7
11765.3 11814.3 11981.8 11485.9
11544.6 11608.9 11773.5 11454.1
11454.4 11529.1 11691.7 11422.3
11384.2 11462.6 11626.0 11446.1
11344.0 11445.2 11602.3 11470.0
11474.4 11578.3 11758.2 11493.8
11504.5 11610.8 11790.3 11561.8
11464.4 11599.0 11770.6 11629.9
11644.9 11792.5 11975.7 11697.9
11865.6 12041.1 12241.0 11793.6
12056.2 12249.6 12450.6 11889.2
1996 11925.8 12140.1 12334.9 11984.9
11925.8 12177.7 12372.7 11980.4
11954.8 12207.7 12403.4 11975.8
11845.5 12076.5 12265.4 11971.3
11955.9 12242.0 12449.6 12088.8
12036.1 12350.9 12567.3 12206.4
12166.5 12497.0 12716.5 12323.9
12437.3 12827.7 13059.4 12434.9
12347.0 12710.9 12948.0 12545.9
12497.5 12894.0 13138.9 12656.9
12648.0 13049.1 13329.5 12747.2
12678.0 13087.5 13390.9 12837.6
1997 12788.4 13206.6 13525.8 12927.9
12949.3 13381.6 13699.4 12995.1
12933.7 13362.2 13689.1 13062.2
12972.9 13411.6 13736.1 13129.4
13020.7 13474.3 13807.8 13211.9
13130.8 13595.8 13938.8 13294.3
13239.5 13704.1 14057.0 13376.8
13257.9 13732.1 14086.9 13577.0
13472.2 13918.2 14316.2 13777.3
13801.0 14230.2 14651.4 13977.5
13670.5 14115.0 14573.9 13991.2
13717.6 14185.4 14656.6 14005.0
1998 13701.0 14246.1 14700.7 14018.7
Average Annual Total Returns
This table shows the average annual total returns. This is where you can see the
Fund's short-term performance, which, as with the securities markets, tends to
be more volatile than the long-term trend.
Since
Inception
1 Year 3 Years (10/3/94)
------ ------- ---------
Premier Shares 7.63% 5.55% 7.74%
Investor Shares 7.59% 5.53% 7.73%
* Source: Lipper Analytical Services. Past performance is no guarantee of future
results. Investment returns and principal value will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than the original
cost.
The Fund is currently waiving certain fees. The voluntary waiver may be modified
or terminated at any time, which would reduce performance.
This chart represents the comparative performance for $10,000 invested in
Premier Shares of Chase Intermediate Term Bond Fund, the Lehman Intermediate
Govt./Corp. Index, the Lehman Aggregate Index and the Lipper Intermediate
Investment Grade Debt Funds Index from October 31, 1994 to December 31, 1998.
The performance of the Fund assumes the reinvestment of all dividends and
capital gains and does not include a sales charge. The performance of the
indices does not include a sales charge and has been adjusted to reflect the
reinvestment of all dividends and capital gains on the securities included in
the benchmark. Premier Shares carry a $1 million minimum initial investment and
carry no sales charge.
Investor Shares were introduced on 11/10/98 and have a minimum initial
investment of $2,500. Please note internal expenses are greater for the Investor
Shares class. Performance measurements for the Investor Shares prior to 11/10/98
are based on the predecessor Premier Shares and do not include Investor Share
class expenses.
Chase Intermediate Term Bond Fund is the successor to the AVESTA Trust
Intermediate Term Bond Fund. Effective 12/31/97, the AVESTA Trust was converted
from a Texas Trust to Mutual Fund Investment ("MFIT"), a Massachusetts business
trust. As part of the conversion, the Fund transferred all of its assets to
Chase Intermediate Term Bond Fund, a new investment portfolio of MFIT.
Chase Intermediate Term Bond Fund, unlike the AVESTA Trust Intermediate Term
Bond Fund, is subject to certain diversification, distribution and other
requirements imposed under the Internal Revenue Code, which may impact
performance.
The Lipper Intermediate Investment Grade Debt Funds Index represents performance
of the largest 30 intermediate investment grade debt funds. Each of these funds
invests the majority of its assets in investment grade debt issues (rated in top
four grades) with dollar-weighted average maturities of five to 10 years. Lipper
is an independent mutual fund performance monitor whose results are based on
total return and do not reflect a sales charge. An individual cannot invest
directly in an index.
The Lehman Aggregate Index is composed of the Lehman Government/Corporate Bond
Index and the Mortgage-Backed Securities Index and includes Treasury issues,
agency issues, corporate bond issues and mortgage-backed securities. The index
is unmanaged and reflects the reinvestment of dividends. An individual cannot
invest directly in an index.
The Lehman Intermediate Gov't/Corp. Index includes the government and corporate
bond indices, with maturities of one to 10 years, including U.S. government
treasury and agency securities, corporate and Yankee bonds. An individual cannot
invest directly in an index.
14
<PAGE>
Chase Intermediate Term
Bond Fund
as of December 31, 1998
(unaudited)
How Much of the Fund Was Invested
[PIE CHART]
Investments 98.8%
Cash/other 1.2%
What the Fund Was Invested In
Percentage of Total Portfolio Investments
[PIE CHART]
Corproate Notes & Bonds 29.8%
Asset Backed Securities 0.1%
Cash Equivalents & Short Term Paper 14.6%
U.S. Treasury Securities 26.6%
Residential Mortgage Backed Securities 25.3%
U.S. Government Agencies 3.6%
15
<PAGE>
Chase Intermediate Term Bond Fund
Portfolio of Investments December 31, 1998
Principal
Amount
USD Issuer Value
- --------------------------------------------------------------------------------
Long-Term Investments -- 84.6%
- --------------------------------------------------------------------------------
U.S. Treasury Securities -- 26.4%
---------------------------------
U.S. Treasury Notes & Bonds,
$1,350,000 5.25%, 01/31/01 $1,366,659
1,600,000 5.50%, 12/31/00 1,626,752
475,000 5.75%, 11/15/00 484,201
880,000 5.75%, 11/30/02 912,314
2,820,000 6.25%, 08/15/23 3,151,801
1,020,000 6.50%, 10/15/06 1,131,404
----------
Total U.S. Treasury Securities
(Cost $8,543,478) 8,673,131
----------
U.S. Government Agencies -- 3.5%
--------------------------------
Federal Home Loan Mortgage Corp.,
500,000 6.01%, 07/28/28 510,080
100,000 6.05%, 06/28/00 101,516
500,000 7.00%, 04/02/07 552,420
----------
Total U.S. Government Agencies
(Cost $1,109,424) 1,164,016
----------
Corporate Notes & Bonds -- 29.6%
--------------------------------
Automotive -- 6.1%
450,000 Chrysler Financial Corp., 6.95%, 03/25/02 470,660
400,000 Ford Motor Co., 6.63%, 02/15/28 410,920
350,000 General Motors Acceptance Corp., 6.63%, 10/15/05 367,815
600,000 Paccar Financial Corp., MTN, 5.91%, 01/15/02 607,056
150,000 US Leasing Capital Corp., 5.95%, 10/15/03 152,579
----------
2,009,030
----------
Banking -- 7.1%
150,000 BankAmerica Corp., 6.85%, 03/01/03 157,226
450,000 NationsBank Corp., 7.00%, 05/15/03 473,436
350,000 NBD Bancorp, 7.13%, 05/15/07 381,560
500,000 Norwest Corp., 6.65%, 10/15/23 512,720
750,000 Republic New York Corp., 8.25%, 11/01/01 802,965
----------
2,327,907
----------
Financial Services -- 6.8%
Associates Corp. of North America,
600,000 6.63%, 05/15/01 615,876
150,000 7.70%, 03/01/02 159,303
200,000 Chubb Capital Corp., 6.88%, 02/01/03 210,764
300,000 Commercial Credit Corp., 5.90%, 09/01/03 304,047
500,000 Morgan Stanley Dean Witter Discover & Co.,
8.10%, 06/24/02 536,670
400,000 Salomon Smith Barney Holdings, Inc., 7.00%, 03/15/04 421,500
----------
2,248,160
----------
Insurance -- 1.9%
600,000 International Lease Finance Corp., 5.95%, 06/01/01 605,418
----------
See notes to financial statements.
16
<PAGE>
Chase Intermediate Term Bond Fund
Portfolio of Investments December 31, 1998 (continued)
Principal
Amount
USD Issuer Value
- --------------------------------------------------------------------------------
Long-Term Investments -- (continued)
- --------------------------------------------------------------------------------
Oil & Gas -- 2.4%
$750,000 Enron Corp., 6.88%, 10/15/07 $782,573
----------
Paper / Forest Products -- 1.7%
500,000 Weyerhaeuser Co., 7.95%, 03/15/25 561,230
----------
Shipping / Transportation -- 2.0%
600,000 Norfolk Southern Corp., Ser. A, MTN, 7.40%, 09/15/06 656,880
----------
Utilities -- 1.6%
500,000 Hydro-Quebec, Ser. B, 6.86%, 04/01/05 528,565
----------
Total Corporate Notes & Bonds
(Cost $9,447,048) 9,719,763
----------
Residential Mortgage-Backed Pass Through Securities -- 25.0%
------------------------------------------------------------
1,615,999 Federal Home Loan Mortgage Corp.,
Gold Pool C17245, 7.00%, 11/01/28 1,647,301
Federal National Mortgage Association,
132,655 Pool 124734, 6.50%, 03/01/00 132,919
480,181 Pool 250772, 7.00%, 12/01/03 485,001
455,796 Pool 398212, 6.50%, 02/01/13 462,204
1,804,496 Pool 398265, 6.00%, 03/01/28 1,780,803
1,165,346 Pool 442508, 6.00%, 09/01/13 1,168,259
Government National Mortgage Association,
481,839 Pool 436259, 6.50%, 03/15/28 486,657
922,485 Pool 448704, 7.50%, 10/15/27 951,018
489,071 Pool 462508, 6.50%, 02/15/28 493,961
297,951 Pool 476305, 6.50%, 05/15/28 300,930
298,128 Pool 478172, 6.50%, 06/15/28 301,109
----------
Total Residential Mortgage-Backed Pass Through Securities
(Cost $8,155,007) 8,210,162
----------
Asset Backed Security -- 0.1%
-----------------------------
32,748 Ford Credit Grantor Trust, Ser. 1995-B,
Class A, 5.90%, 10/15/00
(Cost $32,698) 32,769
----------
Total Long-Term Investments
(Cost $27,287,655) 27,799,841
- -------------------------------------------------------------------------------
See notes to financial statements.
17
<PAGE>
Chase Intermediate Term Bond Fund
Portfolio of Investments December 31, 1998 (continued)
Principal
Amount
USD Issuer Value
- --------------------------------------------------------------------------------
Short-Term Investments -- 14.5%
- -------------------------------------------------------------------------------
U.S. Treasury Securities -- 2.1%
--------------------------------
$700,000 U. S. Treasury Bill, 4.25%, 01/21/99
(Cost $698,347) $ 698,347
----------
Shares
Money Market Fund -- 3.4%
-------------------------
1,123,400 Fidelity Colchester Street Trust Government Fund,
(Cost $1,123,400) 1,123,400
----------
Principal
Amount
USD
Repurchase Agreements -- 9.0%
-----------------------------
$1,474,000 Credit Suisse First Boston (Secured by
Federal National Mortgage Association Pools),
in a joint trading account at 5.10%, dated
12/31/98, due 01/04/99; Proceeds $1,474,835 1,474,000
1,474,000 Greenwich Capital Partners (Secured by Federal
National Mortgage Association Pools), in a joint
trading account at 4.80%, dated 12/31/98,
due 01/04/99; Proceeds $1,474,786 1,474,000
----------
Total Repurchase Agreements
(Cost $2,948,000) 2,948,000
----------
Total Short-Term Investments
(Cost $4,769,747) 4,769,747
- -------------------------------------------------------------------------------
Total Investments -- 99.1%
(Cost $32,057,402) $32,569,588
- -------------------------------------------------------------------------------
Index
# Security may only be sold to qualified institutional buyers.
MTN Medium Term Note
See notes to financial statements.
18
<PAGE>
[This Page Intentionally Left Blank]
19
<PAGE>
Chase Money Market Fund
as of December 31, 1998
(unaudited)
How the Fund Performed
Chase Money Market Fund (Premier Shares) had a total return of 5.21% for the
year ended December 31, 1998.
How the Fund Was Managed
Throughout 1998, the Fund's manager maintained a higher weighted average
maturity than its benchmark. This was a generally positive stance as short-term
interest rates declined over the course of the year.
The Fund's sector strategy was equally consistent throughout the year. It
generally involved holding approximately 25% of its assets in floating rate
notes and investing the remaining assets diversified across various
high-quality, short-term instruments, with a specific focus on commercial paper.
Where the Fund May Be Headed
Moving into the new year, the management team expected to continue to maintain
an only slightly-long duration until there are clearer signs on global
conditions, the strength of the domestic economy and the outlook for Fed policy.
20
<PAGE>
Chase Money Market Fund
as of December 31, 1998
(unaudited)
Fund Facts
Objective Current income
Primary Investments Maximum current income
consistent with the preservation of
capital and maintenance of liquidity
Suggested investment time frame Short-term
Inception date Premier Shares 3/29/88
Investor Shares 11/9/98
Newspaper symbol Not Listed
Dividend Frequency Daily
Net Assets Premier Shares $195,476,000
Investor Shares $17,000
Average Maturity 58 days
21
<PAGE>
Chase Money Market Fund
as of December 31, 1998
(unaudited)
Maturity Schedule
1-14 days 11%
15-30 days 25%
31-60 days 24%
61-90 days 28%
91-180 days 6%
180-270 days 4%
270 + days 2%
7-Day SEC Yield
Premier Shares 4.84%
Investor Shares 4.74%
Performance information represents past performance and is not intended to
indicate or predict future results. Yields will vary and you may experience
gains or losses when you sell your shares.
The Fund is currently waiving certain fees. The voluntary waiver may be modified
or terminated at any time, which would reduce performance.
The Chase Money Market Fund is the successor to the AVESTA Trust Money Market
Fund. Effective December 31, 1997, the AVESTA Trust was converted from a Texas
Trust to Mutual Fund Investment ("MFIT"), a Massachusetts business trust. As
part of the conversion, the Fund transferred all of its assets to the Chase
Money Market Fund, a new investment portfolio of MFIT.
The Chase Money Market Fund unlike the AVESTA Money Market Fund, is subject to
certain diversification, distribution and other requirements imposed under the
Internal Revenue Code, which may impact performance.
Premier Shares, introduced on 3/29/88, carry a $1 million minimum initial
investment and carry no sales charge. Investor Shares were introduced on 11/9/98
and have a minimum initial investment of $2,500. Please note internal expenses
are greater for the Investor Shares class. Performance measurements for the
Investor Shares prior to 11/9/98 are based on the predecessor Premier Shares
class and do not include Investor Share class expenses.
Yield information is net of expenses and fees, and reflects reimbursement and
waiver of certain expenses and fees. An investment in a money market fund is
neither insured nor guaranteed by the U.S. government. Although the Fund strives
to maintain a stable net asset value of $1.00 per share, there can be no
assurance that this objective will be met.
An investment in the Fund isn't a bank deposit and it isn't insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency. Although the Fund seeks to preserve the value of your investment at
$1.00 per share, it is possible to lose money by investing in the Fund.
The Fund is AAAm rated by Standard and Poor's. This rating is historical and is
based upon the fund's credit quality, market exposure and management. It
signifies that the fund's safety is excellent and that it has a superior
capacity to maintain a $1.00 net asset value per share.
22
<PAGE>
Chase Money Market Fund
as of December 31, 1998
(unaudited)
How Much of the Fund Was Invested
[PIE CHART]
Investments 99.3%
Cash/Other 0.7%
What the Fund Was Invested In
Percentage of Total Portfolio Investments
[PIE CHART]
Corproate Notes & Bonds 39.4%
Commercial paper 58.8%
Cash Equivalents & Short Term Paper 0.8%
State & Municipal obligations 1.0%
23
<PAGE>
Chase Money Market Fund
Portfolio of Investments December 31, 1998
Principal
Amount
USD Issuer Value
- --------------------------------------------------------------------------------
State & Municipal Obligation -- 1.0%
------------------------------------
$1,800,000 New York, New York, Taxable, Prerefunded,
Ser. C, 9.75%, 08/15/99
(Cost $1,877,770) $ 1,877,770
-----------
Corporate Notes & Bonds -- 14.1%
--------------------------------
Banking -- 1.7%
3,181,000 Citicorp, 9.75%, 08/01/99 3,250,783
-----------
Computers / Computer Hardware -- 1.8%
2,000,000 IBM Credit Corp., MTN, 5.47%, 02/10/99 1,999,741
1,500,000 IBM Credit Corp., MTN, 5.69%, 03/09/99 1,499,860
-----------
3,499,601
Diversified Machinery -- 3.7%
5,200,000 John Deere Capital Corp., 6.00%, 02/01/99 5,201,506
2,000,000 John Deere Capital Corp., Ser. C, MTN, 6.43%, 08/09/99 2,019,572
-----------
7,221,078
-----------
Financial Services -- 3.8%
Beta Finance Corp., Inc., #
2,000,000 5.70%, 03/31/99 2,000,000
3,000,000 5.75%, 03/16/99 2,999,970
1,000,000 CC USA Inc. (Cenntauri Corp.),
(Cayman Islands), #5.88%, 05/04/99 1,000,000
1,500,000 Merrill Lynch & Co. Ser. B, MTN, 5.57%, 02/16/99 1,499,981
-----------
7,499,951
-----------
Insurance -- 2.6%
1,000,000 International Lease Finance Corp.,
Ser. G, MTN, 6.27%, 02/10/99 1,000,377
4,000,000 Travelers Property and Casualty Corp.,
6.25%, 10/01/99 4,028,517
-----------
5,028,894
Telecommunications -- 0.5%
1,000,000 British Telecommunications Finance, YANKEE,
(United Kingdom), 9.38%, 02/15/99 1,004,339
-----------
Total Corporate Notes & Bonds
(Cost $27,504,646) 27,504,646
-----------
Commercial Paper -- 58.0%
3,500,000 ABN-AMRO North America Finance Inc.
(Netherlands), 4.77%, 03/31/99 3,458,726
6,500,000 American Express Credit Corp., 4.75%, 03/19/99 6,433,962
2,000,000 Banco Nacional De Mexico SA (Mexico), 4.95%,
04/12/99 1,972,225
8,000,000 British Gas Capital Inc., (United Kingdom),
5.44%, 01/22/99 7,974,613
5,000,000 China Merchants Bank, (China), 5.30%, 03/05/99 4,953,625
8,000,000 Corporate Receivables Corp., 5.35%, 02/02/99 7,961,956
Daimler-Benz North America Corp. (Germany),
1,000,000 4.73%, 04/27/99 984,759
6,000,000 5.04%, 03/23/99 5,931,960
1,500,000 5.45%, 02/25/99 1,487,510
1,000,000 Den Danske Bank, (Denmark), 5.44%, 04/01/99 986,400
1,500,000 E.I. Du Pont de Nemours and Co., #4.84%, 02/25/99 1,488,908
See notes to financial statements.
24
<PAGE>
Chase Money Market Fund
Portfolio of Investments December 31, 1998 (continued)
Principal
Amount
USD Issuer Value
- --------------------------------------------------------------------------------
$8,500,000 Ford Motor Credit Corp., 4.86%, 02/19/99 $ 8,443,773
General Electric Capital Services Inc.,
1,000,000 5.13%, 02/23/99 992,448
1,000,000 5.45%, 02/16/99 993,036
8,850,000 Greenwich Funding Corp., 4.52%, 01/29/99 8,812,692
3,000,000 ING America Insurance Holdings, Inc. (Netherlands),
5.00%, 03/02/99 2,975,000
5,000,000 MetLife Funding Inc., 5.37%, 01/29/99 4,979,117
8,000,000 Monte Rosa Capital Corp., 5.40%, 02/19/99 7,941,200
1,000,000 Nationwide Building Society (United Kingdom),
5.08%, 03/15/99 989,699
8,500,000 Prudential Funding Corp., 4.76%, 03/23/99 8,408,965
4,500,000 Rio Tinto America Inc. (United Kingdom),
5.03%, 03/12/99 4,455,987
5,000,000 San Paolo U.S. Financial Co. (Italy), 4.74%, 04/16/99 4,930,875
6,000,000 Sigma Finance Corp. (United Kingdom), # 5.24%, 03/12/99 5,938,867
1,500,000 Silver Tower US Funding, # 5.47%, 02/16/99 1,489,516
500,000 Swiss Bank Corp., NY, Series CD, YANKEE
(Switzerland), 5.75%, 05/07/99 499,905
8,000,000 Windmill Funding Corp., 5.10%, 01/15/99 7,984,133
-----------
Total Commercial Paper
(Cost $113,469,857) 113,469,857
-----------
Foreign Commercial Paper -- 0.5%
--------------------------------
1,000,000 Svenska Handelsbanken Inc. (Sweden),
5.79%, 05/07/99
(Cost $999,835) 999,835
-----------
Corporate Notes & Bonds FRN -- 25.1%
------------------------------------
Automotive -- 1.5%
3,000,000 Toyota Motor Credit Corp., MTN, 5.55%, 09/23/99 3,000,000
-----------
Banking -- 7.7%
5,000,000 Comerica Bank, 5.39%, 11/09/99 5,000,000
2,000,000 Norwest Corp., 5.24%, 10/28/99 2,000,000
8,000,000 PNC Bank, NA, Ser. CD, 5.56%, 10/14/99 8,000,000
-----------
15,000,000
-----------
Financial Services -- 9.3%
2,000,000 American Express Centurion, 5.49%, 05/11/99 2,000,000
8,000,000 Associates Corp. of North America, 5.62%, 04/05/99 8,000,000
6,000,000 Goldman Sachs Group, Ser. A, #5.35%, 01/12/00 6,000,000
Sigma Finance Corp. MTN, (United Kingdom),
1,000,000 5.70%, 03/02/99 1,000,000
1,000,000 5.72%, 03/30/99 1,000,000
-----------
18,000,000
-----------
Insurance -- 1.0%
2,000,000 International Lease Finance Corp., 5.48%, 06/02/99 2,001,880
-----------
Machinery -- 1.5%
3,000,000 Caterpillar Financial Services, Inc., 5.26%, 01/12/99 3,000,000
-----------
See notes to financial statements.
25
<PAGE>
Chase Money Market Fund
Portfolio of Investments December 31, 1998 (continued)
Principal
Amount
USD Issuer Value
- --------------------------------------------------------------------------------
Utilities -- 4.1%
$8,000,000 National Rural Utilities Co., Ser. C, MTN,
5.23%, 11/23/99 $ 8,000,000
------------
Total Corporate Notes & Bonds FRN
(Cost $49,001,880) 49,001,880
------------
Repurchase Agreement -- 0.8%
----------------------------
1,637,000 Merrill Lynch & Co., Inc. (Secured by Federal
Home Loan Mortgage Corp., Gold Pool), in a joint
trading account at 4.75%, dated 12/31/98,
due 01/04/99; Proceeds $1,637,864
(Cost $1,637,000) 1,637,000
- -------------------------------------------------------------------------------
Total Investments -- 99.5%
(Cost $194,490,988)** $194,490,988
- -------------------------------------------------------------------------------
Index
** The cost of securities is substantially the same for federal
income tax purposes.
# Security may only be sold to qualified institutional buyers.
FRN Floating Rate Note; the rate shown is the rate in effect at
December 31, 1998.
MTN Medium Term Note.
Prerefunded The maturity date shown is the date of the prerefunded call.
See notes to financial statements.
26
<PAGE>
[This Page Intentionally Left Blank]
27
<PAGE>
Chase Short-Intermediate Term
U.S. Government Securities Fund
as of December 31, 1998
(unaudited)
How the Fund Performed
Chase Short-Intermediate Term U.S. Government Securities Fund (Premier Shares)
had a total return of 7.35% for the year ended December 31, 1998. This compares
to 6.96% for the Lehman 1-3 Year Government Index and 7.75% for the Lehman
Intermediate Government Index.
How the Fund Was Managed
In the first three months of 1998, the Fund benefited from a slight
overweighting in mortgage-backed securities due to their relatively attractive
yields in a stable interest rate environment. In the second quarter, the Fund
continued to perform well as the manager extended its average maturity beyond
its benchmark with the addition of U.S. Treasury securities. It should be noted
that, during the first half of the year, short- and intermediate-term securities
did not rally as sharply as longer-term issues, so the overall Treasury rally
did not have as large an impact on the Fund as it did on funds that focus on
securities with longer maturities.
By the third quarter, the manager believed that low inflation and lower Treasury
issuance due to the Federal budget surplus would lead to a rally in the Treasury
sector. As a result, the Fund's slightly longer average maturity proved highly
beneficial during the strong third quarter rally. During the fourth quarter, the
Fund became duration neutral by reducing the maturities of its Treasury
holdings. The manager continued to maintain a slight overweighting in mortgages
during the final three months of the year, with an emphasis on seven-year
balloons and 15-year GNMAs given the historically high yield spreads relative to
Treasuries.
Where the Fund May Be Headed
Moving into the new year, the management team expected to stay close to
the Fund's average index maturities until there are clearer signs on global
conditions, the strength of the domestic economy and the outlook for Fed
policy.
28
<PAGE>
Chase Short-Intermediate Term
U.S. Government Securities Fund
as of December 31, 1998
(unaudited)
Fund Facts
Objective Current income
Primary Investments Short-term debt securities
issued by the U.S. government,
its agencies and instrumentalities
Suggested investment time frame Short- to mid-term
Market benchmark Lehman 1-3 Year Government Index
Lehman Intermediate Government Index
Lipper Funds Universe Short Intermediate U.S.
Government Funds Index
Inception date Premier Shares 4/1/93
Investor Shares 11/10/98
Newspaper symbol ST US GV
Dividend Frequency Daily
Net Assets Premier Shares $30,554,000
Investor Shares $10,000
Average Maturity 3.4 years
Average Duration 3.0 years
Average Quality AAA
Average Maturity/Quality
- ----------------
|////| | | Large
|////| | |
- ----------------
| | | | Med
| | | |
- ----------------
| | | | Low
| | | |
- ----------------
Short Int. Long
29
<PAGE>
Chase Short-Intermediate Term
U.S. Government Securities Fund
as of December 31, 1998
(unaudited)
Life of Fund Performance*
This chart shows what the long-term growth would have been of a hypothetical
investment in the Chase Short-Intermediate Term U.S. Government Securities Fund
compared to its key benchmarks. This is where you can see the Fund's long-term
trend. This chart is for illustrative purposes only.
[LINE CHART]
Chase Short- Lipper Short- Lehman Lehman 1-3
Intermediate Intermediate Intermediate Year Gov't.
Year Term U.S. Goven U.S. Gov't. Gov't. Index Index
10000 10000 10000 10000
10086.0 10166.5 10196.2 10112.1
10249.2 10338.9 10411.1 10251.2
1993 10242.6 10349.6 10427.0 10316.9
10104.2 10195.9 10234.0 10264.9
10079.7 10135.7 10177.1 10265.8
10150.8 10219.3 10255.3 10368.5
1994 10134.6 10189.8 10245.0 10368.4
10486.3 10564.9 10670.9 10712.0
10912.7 10968.7 11169.7 11051.5
11030.7 11113.7 11342.8 11216.9
1995 11351.8 11438.6 11721.5 11491.7
11249.8 11368.3 11642.0 11536.1
11314.3 11435.9 11719.9 11657.5
11458.5 11616.3 11921.8 11853.2
1996 11655.8 11855.2 12197.5 12078.3
11679.6 11886.3 12194.5 12155.9
11930.0 12177.1 12534.4 12425.5
12199.9 12446.3 12855.0 12669.7
1997 12389.6 12674.0 13139.5 12881.9
12550.9 12843.9 13338.2 13066.7
12745.2 13042.8 13584.8 13268.1
13281.7 13501.9 14219.3 13673.9
1998 13300.2 13553.0 14254.5 13779.0
Average Annual Total Returns
This table shows the average annual total returns. This is where you can see
the Fund's short-term performance, which, as with the securities markets, tends
to be more volatile than the long-term trend.
Since
Inception
1 Year 3 Years 5 Years (4/1/93)
------ ------- ------- --------
Premier Shares 7.35% 5.42% 5.36% 5.08%
Investor Shares 7.22% 5.38% 5.34 5.06%
* Source: Lipper Analytical Services. Past performance is no guarantee of
future results. Investment returns and principal value will fluctuate so that
an investor's shares, when redeemed, may be worth more or less than the
original cost.
The Fund is currently waiving certain fees. The voluntary waiver may be modified
or terminated at any time, which would reduce performance.
This chart represents the comparative performance for $10,000 invested in
Premier Shares of Chase Short-Intermediate Term U.S. Government Securities Fund,
the Lehman 1-3 Year Government Index, the Lehman Intermediate Government Index
and Lipper Short-Intermediate Term U.S. Government Funds Index from April 1,
1993 to December 31, 1998. The performance of the Fund assumes the reinvestment
of all dividends and capital gains and does not include a sales charge. The
performance of the indices does not include a sales charge and has been adjusted
to reflect the reinvestment of all dividends and capital gains on the securities
included in the benchmark. Premier Shares carry a $1 million minimum initial
investment and carry no sales charge.
Investor Shares were introduced on 11/10/98 and have a minimum initial
investment of $2,500. Please note internal expenses are greater for the Investor
Shares class. Performance measurements for the Investor Shares prior to 11/10/98
are based on the predecessor Premier Shares class and do not include Investor
Share class expenses.
Chase Short-Intermediate Term U.S. Government Securities Fund is the successor
to the AVESTA Trust Short-Intermediate Term U.S. Government Securities Fund.
Effective 12/31/97, the AVESTA Trust was converted from a Texas Trust to Mutual
Fund Investment ("MFIT"), a Massachusetts business trust. As part of the
conversion, the Fund transferred all of its assets to Chase Short-Intermediate
Term U.S. Government Securities Fund, a new investment portfolio of MFIT.
Chase Short-Intermediate Term U.S. Government Securities Fund, unlike the AVESTA
Trust Short-Intermediate Term U.S. Government Securities Fund, is subject to
certain diversification, distribution and other requirements imposed under the
Internal Revenue Code, which may impact performance.
The Lehman 1-3 Year Government Index is composed of bonds covered by the
Government Bond Index with maturities of 1-3 years. The Lehman Intermediate
Government Bond Index is composed of bonds covered by the Government Bond Index
with maturities of 5-10 years. The indices are unmanaged and reflect the
reinvestment of dividends. An individual cannot invest directly in an index.
The Lipper Short-Intermediate Term U.S. Government Fund Index represents
performance of the 30 largest short-intermediate term debt funds. Lipper is an
independent mutual fund performance monitor whose results are based on total
return and do not reflect a sales charge. An individual cannot invest directly
in an index.
The Lehman Intermediate Government Index consists of U.S. agency and Treasury
securities with maturities of one to 10 years. An individual cannot invest
directly in an index.
30
<PAGE>
Chase Short-Intermediate Term
U.S. Government Securities Fund
as of December 31, 1998
(unaudited)
How Much of the Fund Was Invested
[PIE CHART]
Investments 99.0%
Cash/other 1.0%
What the Fund Was Invested In
Percentage of Total Portfolio Investments
[PIE CHART]
Residential Mortgage Backed Securities 16.2%
Cash Equivalents & Short Term Paper 11.3%
U.S. Treasury Securities 63.4%
U.S. Government Agency Obligations 9.1%
31
<PAGE>
Chase Short-Intermediate Term
U.S. Government Securities Fund
Portfolio of Investments December 31, 1998
Principal
Amount
USD Issuer Value
- ------------------------------------------------------------------------------
Long-Term Investments -- 88.0%
- ------------------------------------------------------------------------------
U.S. Treasury Securities -- 62.9%
---------------------------------
U.S. Treasury Notes & Bonds,
$2,300,000 5.25%, 08/15/03 $ 2,358,581
5,000,000 5.50%, 12/31/00 5,083,600
1,200,000 5.50%, 03/31/03 1,236,372
1,000,000 5.50%, 02/15/08 1,059,690
500,000 5.63%, 11/30/00 508,905
1,500,000 5.63%, 12/31/02 1,549,920
1,000,000 5.63%, 02/15/06 1,054,690
1,000,000 5.75%, 11/30/02 1,036,720
900,000 5.88%, 11/30/01 930,375
500,000 5.88%, 09/30/02 519,685
1,150,000 6.50%, 05/31/01 1,197,978
1,100,000 6.88%, 05/15/06 1,243,682
1,408,000 7.75%, 11/30/99 1,446,284
-----------
Total U.S. Treasury Securities
(Cost $18,745,805) 19,226,482
-----------
U.S. Government Obligations -- 9.0%
-----------------------------------
1,300,000 Federal Home Loan Bank, 6.79%, 04/17/01 1,352,689
1,330,000 Federal Farm Credit Bank, 6.90%, 05/01/02 1,405,983
-----------
Total U.S. Government Obligations
(Cost $2,640,697) 2,758,672
-----------
Residential Mortgage-Backed Securities -- 16.1%
-----------------------------------------------
Mortgage-Backed Pass Through Securities -- 14.7%
Federal National Mortgage Association,
1,561,294 Pool 190806, 6.00%, 05/01/01 1,563,449
2,895,313 Pool 251901, 6.50%, 08/01/13 2,936,021
-----------
4,499,470
-----------
Collateralized Mortgage Obligations -- 1.4%
420,090 Federal Home Loan Mortgage Corp.,
Ser. 1566, Class C, 5.60%, 09/15/00 418,775
-----------
Total Residential Mortgage-Backed Securities
(Cost $4,883,360) 4,918,245
-----------
Total Long-Term Investments
(Cost $26,269,862) 26,903,399
-----------
See notes to financial statements.
32
<PAGE>
Chase Short-Intermediate Term
U.S. Government Securities Fund
Portfolio of Investments December 31, 1998 (continued)
Shares Issuer Value
- ------------------------------------------------------------------------------
Short-Term Investments -- 11.2%
- ------------------------------------------------------------------------------
Money Market Fund -- 3.2%
-------------------------
966,700 Fidelity Colchester Street Trust Government Fund
(Cost $966,700) $ 966,700
-----------
Principal
Amount
(USD)
Repurchase Agreements -- 8.0%
-----------------------------
$1,366,000 Credit Suisse First Boston (Secured by Federal
National Mortgage Association Pools), in a joint
trading account at 5.10%, dated 12/31/98,
due 01/04/99; Proceeds $1,366,774 1,366,000
1,087,000 Greenwich Capital Partners (Secured by Federal
National Mortgage Association Pools), in a joint
trading account at 4.80%, dated 12/31/98,
due 01/04/99; Proceeds $1,087,580 1,087,000
-----------
Total Repurchase Agreements
(Cost $2,453,000) 2,453,000
-----------
Total Short-Term Investments
(Cost $3,419,700) 3,419,700
- -------------------------------------------------------------------------------
Total Investments -- 99.2%
(Cost $29,689,562) $30,323,099
- -------------------------------------------------------------------------------
Index
# Security may only be sold to qualified institutional buyers.
See notes to financial statements.
33
<PAGE>
Chase U.S. Government Securities Fund
as of December 31, 1998
(unaudited)
How the Fund Performed
Chase U.S. Government Securities Fund (Premier Shares) had a total return of
9.28% for the year ended December 31, 1998. This compares to 7.85% for the
Lipper General U.S. Government Funds Index and 9.85% for the Lehman Government
Index.
How the Fund Was Managed At the end of 1997, the Fund's manager implemented a
strategy that strongly overweighted Treasury securities given the belief that
low inflation and lower Treasury issuance due to the Federal budget surplus
would spark a strong rally in the sector. This strategy was reinforced by the
manager's belief that concerns about the potential for pre-payments would cause
mortgage-backed securities to underperform in a rallying market environment.
While the overall bullish approach was somewhat effective in the first half of
1998, it was fully validated in the third quarter when Treasuries sharply
outperformed mortgage-backed securities. An additional factor supporting
performance throughout much of the first nine months of the year was the Fund's
longer-than-benchmark duration.
With the strong Treasury performance, yields on mortgage-backed securities
widened dramatically, leading the manager to add to agency and mortgage-backed
securities in late September and effectively cut duration by reducing exposure
to Treasuries. This adjustment was slightly negative to performance in October,
positive in November and neutral in December. The Fund ended the year with a
modest allocation to mortgages and an only slightly-long duration.
Where the Fund May Be Headed
Moving into the new year, the management team expected to continue to add
mortgage-backed securities and maintain a slightly-long duration given its
long-term bullish view on interest rates. However, the strategy calls for
staying close to the index until there are clearer signs on global conditions,
the strength of the domestic economy and the outlook for Fed policy.
34
<PAGE>
Chase U.S. Government Securities Fund
as of December 31, 1998
(unaudited)
Fund Facts
Objective Current income
Primary Investments Debt securities issued or
guaranteed by the U.S.
government, its agencies and
instrumentalities
Suggested investment time frame Mid- to long-term
Market benchmark Lehman Government Index
Lipper Funds Universe Lipper General U.S.
Government Funds Index
Inception date Premier Shares 4/1/93
Investor Shares 11/10/98
Newspaper symbol Not Listed
Dividend Frequency Daily
Net Assets Premier Shares $3,624,000
Investor Shares $10,000
Average Maturity 9.2 years
Average Duration 6.2 years
Average Quality AAA
Average Maturity/Quality
- ----------------
| |////| | High
| |////| |
- ----------------
| | | | Med
| | | |
- ----------------
| | | | Low
| | | |
- ----------------
Short Int. Long
35
<PAGE>
Chase U.S. Government
Securities Fund
as of December 31, 1998
(unaudited)
Life of Fund Performance*
This chart shows what the long-term growth would have been of a hypothetical
investment in the Chase U.S. Government Securities Fund compared to its key
benchmarks. This is where you can see the Fund's long-term trend. This chart is
for illustrative purposes only.
[LINE CHART]
Chase Lipper
U.S. Government General US Gov't Lehman Gov't
Year Securities Fund Funds Index Index
10000 10000 10000
10534.9 10252.9 10289.2
11050.9 10494.3 10623.5
1993 10912.2 10461.7 10587.5
10266.1 10134.9 10268.9
9996.6 9938.0 10151.7
9821.5 9951.8 10194.6
1994 9997.1 9965.6 10230.1
10646.5 10415.8 10711.6
11749.3 10993.2 11375.9
11977.0 11185.9 11577.7
1995 13007.6 11654.0 12106.4
12124.5 11376.7 11832.9
12102.5 11387.2 11889.2
12224.6 11570.5 12089.3
1996 12761.6 11905.5 12441.9
12304.7 11815.0 12340.9
12960.1 12232.4 12768.7
13540.0 12628.7 13196.8
1997 13979.3 12990.8 13634.9
14190.4 13163.1 13840.4
14573.8 13450.5 14205.2
15279.1 14044.9 14990.8
1998 15277.4 14010.4 14978.2
Average Annual To tal Returns
This table shows the average annual total returns. This is
where you can see the Fund's short-term performance, which, as with the
securities market s, tends to be more volatile than the long-term trend.
Since
Inception
1 Year 3 Years 5 Years (4/1/93)
------ ------- ------- --------
Premier Shares 9.28% 5.50% 6.96% 7.64%
Investor Shares 9.25% 5.49% 6.95% 7.63%
* Source: Lipper Analytical Services. Past performance is no guarantee of
future results. Investment returns and principal value will fluctuate so that
an investor's shares, when redeemed, may be worth more or less than the
original cost.
The Fund is currently waiving certain fees. The voluntary waiver may be modified
or terminated at any time, which would reduce performance.
This chart represents the comparative performance for $10,000 invested in
Premier Shares of Chase U.S. Government Securities Fund, the Lehman Government
Index, and Lipper General U.S. Government Funds Index from April 1, 1993 to
December 31, 1998. The performance of the Fund assumes the reinvestment of all
dividends and capital gains and does not include a sales charge. The performance
of the indices does not include a sales charge and has been adjusted to reflect
the reinvestment of all dividends and capital gains on the securities included
in the benchmark. Premier Shares carry a $1 million minimum initial investment
and carry no sales charge.
Investor Shares were introduced on 11/10/98 and have a minimum initial
investment of $2,500. Please note internal expenses are greater for the
Investor Shares class. Performance measurements for the Investor Shares prior
to 11/10/98 are based on the predecessor Premier Shares class and do not
include Investor Share class expenses.
Chase U.S. Government Securities Fund is the successor to the AVESTA Trust U.S.
Government Securities Fund. Effective 12/31/97, the AVESTA Trust was converted
from a Texas Trust to Mutual Fund Investment ("MFIT"), a Massachusetts business
trust. As part of the conversion, the Fund transferred all of its assets to
Chase U.S. Government Securities Fund, a new investment portfolio of MFIT.
Chase U.S. Government Securities Fund, unlike the AVESTA U.S. Government
Securities Fund, is subject to certain diversification, distribution and other
requirements imposed under the Internal Revenue Code, which may impact
performance.
Lehman Government Index is composed of the Lehman Treasury Bond Index and the
Agency Bond Index and includes Treasury bonds and debt issued by the U.S.
Government and its agencies. The index is unmanaged and includes the
reinvestment of dividends. An individual cannot invest directly in an index.
The Lipper General U.S. Government Funds Index represents performance of the 30
largest U.S. government securities funds. Lipper is an independent mutual fund
performance monitor whose results do not reflect a sales charge. An individual
cannot invest directly in an index.
36
<PAGE>
Chase U.S. Government
Securities Fund
as of December 31, 1998
(unaudited)
How Much of the Fund Was Invested
[PIE CHART]
Investments 97.8%
Cash/other 2.2%
What the Fund Was Invested In
Percentage of Total Portfolio Investments
[PIE CHART]
Residential Mortgage Backed Securities 27.3%
U.S. Treasury Securities 66.6%
Cash Equivalents & Short Term Paper 6.1%
37
<PAGE>
Chase U.S. Government Securities Fund
Portfolio of Investments December 31, 1998
Principal
Amount
USD Issuer Value
- --------------------------------------------------------------------------------
Long-Term Investments -- 92.8%
- -------------------------------------------------------------------------------
U.S. Treasury Securities -- 65.8%
---------------------------------
$300,000 5.63%, 05/15/08 $ 320,109
350,000 5.75%, 08/15/03 365,477
535,000 6.25%, 10/31/01 557,400
700,000 6.25%, 08/15/23 782,362
350,000 6.50%, 08/31/01 366,023
---------
Total U.S. Treasury Securities
(Cost $2,360,883) 2,391,371
---------
Residential Mortgage-Backed Pass Through Securities -- 27.0%
------------------------------------------------------------
491,419 Federal Home Loan Mortgage Corp.,
Gold Pool E00570, 6.00%, 09/01/13 493,105
481,479 Government Mortgage Association Corp.,
Pool 407230, 6.50%, 01/15/28 486,294
Total Residential Mortgage-Backed Pass
Through Securities
(Cost $977,751) 979,399
---------
Total Long-Term Investments
(Cost $3,338,634) 3,370,770
- -------------------------------------------------------------------------------
Shares Issuer Value
- -------------------------------------------------------------------------------
Short-Term Investments -- 6.0%
- -------------------------------------------------------------------------------
Money Market Fund -- 1.7%
-------------------------
61,400 Fidelity Colchester Street Trust Government Fund
(Cost $61,400) 61,400
---------
Principal
Amount
USD
Repurchase Agreement -- 4.3%
----------------------------
$ 156,000 Credit Suisse First Boston (Secured by
Federal National Mortgage Association Pools),
in a joint trading account at 5.10%,
dated 12/31/98, due 01/04/99; Proceeds $156,088
(Cost $156,000) 156,000
---------
Total Short-Term Investments
(Cost $217,400) 217,400
- -------------------------------------------------------------------------------
Total Investments -- 98.8%
(Cost $3,556,034) $3,588,170
- -------------------------------------------------------------------------------
See notes to financial statements.
38
<PAGE>
Chase Funds
Statement of Assets and Liabilities As of December 31, 1998
<TABLE>
<CAPTION>
Chase
Chase Intermediate Chase
Income Term Bond Money Market
Fund Fund Fund
---- ---- ----
<S> <C> <C> <C>
ASSETS:
Investment securities, at value (Note 1) ............... $59,356,749 $32,569,588 $194,490,988
Cash ................................................... 650 44,925 644
Receivables:
Interest .......................................... 871,283 325,981 1,278,746
Fund shares sold ................................... 5,393 7,561 7,000
Expense reimbursement from Distributor ............ 11,554 1,554 1,554
----------- ----------- ------------
Total Assets ................................. 60,245,629 32,949,609 195,778,932
----------- ----------- ------------
LIABILITIES:
Payables:
Trust shares redeemed ............................. 89,449 4,189 -
Dividends Payable ................................. 10,320 4,673 158,692
Accrued liabilities: (Note 2)
Investment advisory fees .......................... 16,598 1,394 34,810
Administration fees ............................... 7,544 4,184 24,864
Custodian ......................................... 7,599 15,167 10,007
Other ............................................. 35,627 39,445 56,831
----------- ----------- ------------
Total Liabilities ............................ 167,137 69,052 285,204
----------- ----------- ------------
NET ASSETS:
Paid in capital ........................................ 57,814,484 32,340,520 195,494,422
Accumulated (distributions in excess of)
undistributed net investment income ................. 2,744 283 (72)
Accumulated (distributions in excess of)
undistributed net realized gain (loss) on
investments.......................................... 578,518 27,568 (622)
Net unrealized appreciation of investments ............. 1,682,746 512,186 -
----------- ----------- ------------
Net Assets: ....................................... $60,078,492 $32,880,557 $195,493,728
=========== =========== ============
Shares of beneficial interest outstanding
($.001 par value; unlimited number of
shares authorized)
Premier Shares .................................... 2,934,183 2,554,049 195,477,137
Investor Shares ................................... 506 805 17,285
Net Asset Value, maximum offering and
redemption price per share
Premier Shares .................................... $20.47 $12.87 $1.00
Investor Shares ................................... $20.46 $12.87 $1.00
Cost of Investments .................................... $57,674,003 $32,057,402 $194,490,988
----------- ----------- ------------
<CAPTION>
Chase
Short-Intermediate
Term U.S. Chase
Government Government
Securities Securities
Fund Fund
---- ----
<S> <C> <C>
ASSETS:
Investment securities, at value (Note 1) ............... $30,323,099 $3,588,170
Cash ................................................... 362 96
Receivables:
Interest .......................................... 214,835 45,251
Fund shares sold ................................... 74,510 -
Expense reimbursement from Distributor ............. 1,554 35,097
----------- ----------
Total Assets ................................. 30,614,360 3,668,614
----------- ----------
LIABILITIES:
Payables:
Trust shares redeemed ............................. 716 -
Dividends Payable ................................. 2,373 -
Accrued liabilities: (Note 2)
Investment advisory fees .......................... 3,599 -
Administration fees ............................... 3,856 -
Custodian ......................................... 9,212 5,979
Other ............................................. 30,181 28,550
----------- ----------
Total Liabilities ............................ 49,937 34,529
----------- ----------
NET ASSETS:
Paid in capital ........................................ 29,823,143 3,602,012
Accumulated (distributions in excess of)
undistributed net investment income ................. 416 -
Accumulated (distributions in excess of)
undistributed net realized gain (loss) on
investments ......................................... 107,327 (63)
Net unrealized appreciation of investments ............. 633,537 32,136
----------- ----------
Net Assets: ............................................ $30,564,423 $3,634,085
=========== ==========
Shares of beneficial interest outstanding
($.001 par value; unlimited number of
shares authorized)
Premier Shares .................................... 2,425,734 262,041
Investor Shares ................................... 815 748
Net Asset Value, maximum offering and
redemption price per share
Premier Shares .................................... $12.60 $13.83
Investor Shares ................................... $12.59 $13.83
Cost of Investments .................................... $29,689,562 $3,556,034
----------- ----------
</TABLE>
See notes to financial statements.
39
<PAGE>
Chase Funds
Statement of Operations For the year ended December 31, 1998
<TABLE>
<CAPTION>
Chase
Chase Intermediate Chase
Income Term Bond Money Market
Fund Fund Fund
---- ---- ----
<S> <C> <C> <C>
INVESTMENT INCOME: ..................................... $3,345,037 $1,525,463 $9,282,617
EXPENSES: (Note 2)
Investment advisory fees ............................... 277,249 126,776 499,599
Administration fees .................................... 83,175 38,033 249,800
Custodian fees ......................................... 58,958 66,151 74,798
Printing and postage ................................... 19,589 9,959 53,288
Professional fees ...................................... 23,537 18,983 32,616
Registration costs ..................................... 17,895 17,895 20,838
Transfer agent fees .................................... 28,031 29,920 39,888
Trustees fees .......................................... 6,239 2,907 18,325
Other .................................................. 7,026 10,195 17,868
Total expenses ............................... 521,699 320,819 1,007,020
Less amounts waived (Note 2D) ........................ 94,268 129,097 172,800
Less expenses borne by the Distributor ............... 11,554 1,554 1,554
Net expenses ..................................... 415,877 190,168 832,666
Net investment income ........................ 2,929,160 1,335,295 8,449,951
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS:
Net realized gain (loss) on investments ................ 1,952,420 408,698 (622)
Change in net unrealized appreciation/
depreciation on investments ......................... 131,577 137,681 -
Net realized and unrealized gain (loss)
on investments .................................. 2,083,997 546,379 (622)
Net increase in net assets from operations .......... $5,013,157 $1,881,674 $8,449,329
<CAPTION>
Chase
Short-Intermediate
Term U.S. Chase U.S.
Government Government
Securities Securities
Fund Fund
---- ----
<S> <C> <C>
INVESTMENT INCOME: ..................................... $1,657,462 $177,987
EXPENSES: (Note 2)
Investment advisory fees ............................... 142,451 15,300
Administration fees .................................... 42,735 4,591
Custodian fees ......................................... 50,360 38,768
Printing and postage ................................... 10,165 6,275
Professional fees ...................................... 19,299 11,280
Registration costs ..................................... 17,895 5,443
Transfer agent fees .................................... 26,459 33,815
Trustees fees .......................................... 3,382 343
Other .................................................. 5,055 2,004
Total expenses ............................... 317,801 117,819
Less amounts waived (Note 2D) ........................ 102,568 19,891
Less expenses borne by the Distributor ............... 1,554 74,977
Net expenses ..................................... 213,679 22,951
Net investment income ........................ 1,443,783 155,036
REALIZED AND UNREALIZED GAIN
(LOSS) ON INVESTMENTS:
Net realized gain (loss) on Investments ................ 214,721 168,122
Change in net unrealized appreciation/
depreciation on Investments ......................... 343,843 (58,919)
Net realized and unrealized gain (loss)
on investments .................................. 558,564 109,203
Net increase in net assets from operations .......... $2,002,347 $264,239
</TABLE>
40
See notes to financial statements.
<PAGE>
Chase Funds
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Chase Chase Intermediate
Income Fund Term Bond Fund
-------------------------------------------------------------
For the Year Ended December 31,
1998 1997 1998 1997
-------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS:
Net investment income .............................. $2,929,160 $2,989,444 $1,335,295 $843,372
Net realized gain (loss) on investments ............ 1,952,420 (39,579) 408,698 85,966
Change in net unrealized appreciation/
depreciation on investments ..................... 131,577 1,289,272 137,681 359,955
-------------------------------------------------------------
Increase in net assets from operations ....... 5,013,157 4,239,137 1,881,674 1,289,293
-------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income .............................. (2,929,160) - (1,335,295) -
In excess of net investment income ................. (18,195) - (384) -
Net realized gain on investment transactions ....... (1,352,963) - (380,463) -
In excess of net realized gain on
investment transactions ......................... - - - -
-------------------------------------------------------------
Total dividends and distributions ............. (4,300,318) - (1,716,142) -
-------------------------------------------------------------
Increase (decrease) from capital share
transactions (Note 5) ........................... 8,036,636 (6,524,419) 14,119,775 10,357,199
-------------------------------------------------------------
Total increase (decrease) in net assets ....... 8,749,475 (2,285,282) 14,285,307 11,646,492
NET ASSETS:
Beginning of period ............................. 51,329,017 53,614,299 18,595,250 6,948,758
-------------------------------------------------------------
End of period ................................... $60,078,492 $51,329,017 $32,880,557 $18,595,250
=============================================================
<CAPTION>
Chase Chase Short-Intermediate Term
Money Market Fund U.S. Government Securities Fund
--------------------------------------------------------------------
1998 1997 1998 1997
--------------------------------------------------------------------
<S> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS:
Net investment income .............................. $8,449,951 $6,306,866 $1,443,783 $1,402,140
Net realized gain (loss) on investments ............ (622) - 214,721 (36,214)
Change in net unrealized appreciation/
depreciation on investments ..................... - - 343,843 173,254
--------------------------------------------------------------------
Increase in net assets from operations ........ 8,449,329 6,306,866 2,002,347 1,539,180
--------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income .............................. (8,449,951) (6,306,866) (1,443,782) -
In excess of net investment income ................. - - (11,378) -
Net realized gain on investment transactions ....... (72) - (95,601) -
In excess of net realized gain on
investment transactions ......................... - - - -
--------------------------------------------------------------------
Total dividends and distributions ............. (8,450,023) (6,306,866) (1,550,761) -
--------------------------------------------------------------------
Increase (decrease) from capital share
transactions (Note 5) ........................... 60,915,528 15,472,904 6,164,374 (6,141,498)
--------------------------------------------------------------------
Total increase (decrease) in net assets ....... 60,914,834 15,472,904 6,615,960 (4,602,318)
NET ASSETS:
Beginning of period ............................. 134,578,894 119,105,990 23,948,463 28,550,781
--------------------------------------------------------------------
End of period ................................... $195,493,728 $134,578,894 $30,564,423 $23,948,463
====================================================================
<CAPTION>
Chase U.S. Government
Securities Fund
----------------------------
1998 1997
----------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS:
Net investment income .............................. $155,036 $159,592
Net realized gain (loss) on investments ............ 168,122 114,518
Change in net unrealized appreciation/
depreciation on investments ..................... (58,919) (15,753)
----------------------------
Increase in net assets from operations ........ 264,239 258,357
----------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income .............................. (155,036) -
In excess of net investment income ................. - -
Net realized gain on investment transactions ....... (168,122) -
In excess of net realized gain on
investment transactions ......................... (1,732) -
----------------------------
Total dividends and distributions ............. (324,890) -
----------------------------
Increase (decrease) from capital share
transactions (Note 5) ........................... 766,977 (77,275)
----------------------------
Total increase (decrease) in net assets ....... 706,326 181,082
NET ASSETS:
Beginning of period ............................. 2,927,759 2,746,677
----------------------------
End of period ................................... $3,634,085 $2,927,759
============================
</TABLE>
41
See notes to financial statements.
<PAGE>
Chase Funds
Notes to Financial Statements
1. Organization and Significant Accounting Policies -- Mutual Fund Investment
Trust (the "Trust") was organized on September 23, 1997 as a Massachusetts
Business Trust, and is registered under the Investment Company Act of 1940, as
amended, (the 1940 Act) as an open-end management investment company. Chase
Income Fund (CIF), Chase Intermediate Term Bond Fund (CIBF), Chase Money
Market Fund (CMMF), Chase Short-Intermediate Term U.S. Government Securities
Fund (CISF) and Chase U.S. Government Securities Fund (CGSF), collectively,
the "Funds," are separate series of the Trust. Each Fund offers both Premier
and Investor classes of shares.
All classes of shares have equal voting rights as to earnings, assets and voting
privileges, except that each class may bear different transfer agent,
distribution, and shareholder servicing expenses, and each class has exclusive
voting rights with respect to its distribution plan and shareholder servicing
agreement. Premier Shares may be purchased only by Financial Intermediaries who
are able to meet the minimum investment requirement.
The Funds were established on January 1, 1998 for the conversion of the AVESTA
Trust to the newly created Chase Funds of the Mutual Fund Investment Trust.
The AVESTA Trust contributed securities and other assets (net of liabilities),
in exchange for shares of the corresponding portfolio of the newly created
Funds in a tax-free exchange. The Chase Manhattan Bank agreed to bear all cost
related to the conversion.
The following is a summary of significant accounting policies followed by the
Funds:
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts and disclosures in the financial statements.
Actual results could differ from those estimates.
A. Valuation of investments -- Bonds and other fixed income securities
(other than short-term obligations), including listed issues, are valued
on the basis of valuations supplied by pricing services or by matrix
pricing systems of a major dealer in bonds. Short-term debt securities
with 61 days or more to maturity at time of purchase are valued, through
the 61st day prior to maturity, at market value based on quotations
obtained from market makers or other appropriate sources; thereafter, the
value on the 61st day is amortized on a straight-line basis over the
remaining number of days to maturity. Short-term investments with 60 days
or less to maturity at time of purchase are valued at amortized cost,
which approximates market. Portfolio securities for which there are no
such quotations or valuations are valued at fair value as determined in
good faith by or at the direction of the Trustees.
B. Repurchase agreements -- Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the Funds of the Trust may transfer
uninvested cash balances into one or more joint trading accounts for the
purpose of investing in repurchase agreements. It is the Funds' policy
that repurchase agreements are fully collateralized by U.S. Treasury and
Government Agency securities. All collateral is held in one or more Joint
Trading Accounts by the Trust's custodian bank, subcustodian, or a bank
with which the custodian bank has entered into a subcustodian agreement,
or is segregated in the Federal Reserve Book Entry System. In connection
with transactions in repurchase agreements, if the seller defaults and
the value of the collateral declines, or if the seller enters an
insolvency proceeding, realization of the collateral by the Fund may be
delayed or limited.
C. Security transactions and investment income -- Investment transactions
are accounted for on the trade date (the date the order to buy or sell is
executed). Securities gains and
42
<PAGE>
Chase Funds
Notes to Financial Statements (continued)
losses are calculated on the identified cost basis. Interest income is
determined on the basis of coupon interest accrued adjusted for
amortization of premiums and accretion of discounts.
D. Expenses -- In calculating the net asset value per share of each
class, investment income, realized and unrealized gains and losses and
expenses other than class specific expenses (including transfer agent
fees), are allocated daily to each class of shares based upon the
proportion of net assets of each class at the beginning of each day.
E. Federal income taxes -- Each Fund is treated as a separate taxable
entity for Federal income tax purposes. Each Fund's policy is to comply
with the provisions of the Internal Revenue Code applicable to regulated
investment companies and to distribute to shareholders all of its
distributable net investment income, and net realized gain on
investments. In addition, each Fund intends to make distributions as
required to avoid excise taxes. Accordingly, no provision for Federal
income or excise tax is necessary.
F. Distributions to shareholders -- Dividends and distributions paid to
shareholders are recorded on the ex-dividend date. The amount of
dividends and distributions from net investment income and net realized
capital gains is determined in accordance with Federal income tax
regulations, which may differ from generally accepted accounting
principles. Dividends and distributions which exceed net investment
income or net realized capital gains for financial reporting purposes but
not for tax purposes are reported as distributions in excess of net
investment income or net realized capital gains.
2. Fees and Other Transactions with Affiliates
A. Investment advisory fee -- Pursuant to separate Investment Advisory
Agreements, The Chase Manhattan Bank (Chase or the Adviser) acts as the
Investment Adviser to the Funds. Chase is a direct wholly owned
subsidiary of The Chase Manhattan Corporation. As Investment Adviser,
Chase supervises the investments of the Funds and for such services is
paid a fee. The fee is computed daily and paid monthly at an annual rate
equal to 0.30% for CMMF and 0.50% for CIF, CIBF, CISF and CGSF of the
average daily net assets, respectively. The Adviser voluntarily waived
some or all of its fees as outlined in Note 2.D.
Chase Texas, a wholly owned subsidiary of The Chase Manhattan
Corporation, is the Sub-Investment Advisor to each Fund. Pursuant to the
Sub-Investment Advisory Agreement between Chase Texas and Chase, Chase
Texas is entitled to receive a fee payable by Chase from its advisory
fee, at an annual rate equal to 0.15% for CMMF and 0.25% for CISF, CGSF,
CIBF and CIF of average daily net assets, respectively.
B. Distribution and Sub-administration fees -- Pursuant to a Distribution
and Sub-Administration Agreement, Chase Fund Distributors, Inc. ("CFD" or
the "Distributor"), a wholly owned subsidiary of The BISYS Group, Inc.,
acts as the Funds' distributor and sub-administrator.
The Trust has adopted a Rule 12b-1 distribution plan for Investor Class
shares, which provides for the payment of distribution fees at an annual
rate of up to 0.10% of the average daily net assets attributable to
Investor Class shares of the Money Market Fund and at an annual rate of
up to 0.25% of the average daily net assets attributable to Investor
Class shares of each other Fund.
For the sub-administrative services it performs, CFD is entitled to
receive a fee from each Fund at annual rate equal to 0.05% of the Fund's
average daily net assets.
The Distributor voluntarily waived all or a portion of its fees.
43
<PAGE>
Chase Funds
Notes to Financial Statements (continued)
C. Administration fee -- Pursuant to an Administration Agreement, Chase
(the Administrator) provides certain administration services to the
Trust. For these services and facilities, the Administrator receives from
each Fund a fee computed at the annual rate equal to 0.10% of the
respective Fund's average daily net assets. The Administrator voluntarily
waived some or all of its fees as outlined in Note 2.D.
D. Waiver of fees -- For the year ended December 31, 1998, the
Administrator and Investment Advisor voluntarily waived fees for each of
the Funds as follows:
Chase
Short-
Intermediate Chase
Chase Chase Term U.S. U.S.
Chase Intermediate Money Government Government
Income Fund Market Securities Securities
Fund Bond Fund Fund Fund Fund
------ ------------ ------- ------------ ----------
Investment Advisory $ 94,268 $ 123,836 $ 172,800 $ 102,568 $ 15,300
Administration - 5,261 - - 4,591
--------- --------- --------- ---------- ----------
Total $ 94,268 $ 129,097 $ 172,800 $ 102,568 $ 19,891
--------- --------- --------- ---------- ----------
--------- --------- --------- ---------- ----------
E. Other -- Certain officers of the Trust are officers of Chase Fund
Distributors, Inc. or of its parent corporation, The BISYS Group, Inc.
Chase provides portfolio accounting and custody services for the Funds.
Compensation for such services is presented in the Statement of
Operations as custodian fees.
3. Investment Transactions -- Purchases and sales of investments (excluding
short-term investments) were as follows:
Chase
Short-
Intermediate Chase
Chase Term U.S. U.S.
Chase Intermediate Government Government
Income Fund Securities Securities
Fund Bond Fund Fund Fund
------ ------------ ------------ -----------
Purchases (excluding
U.S. Government) $ 2,204,972 $ 7,056,766 $ - $ -
Sales (excluding
U.S. Government) 1,167,136 2,431,817 - -
Purchases of U.S.
Government 32,212,340 35,150,004 24,812,724 3,560,684
Sales of U.S.
Government 26,486,962 28,422,170 19,674,466 3,115,563
4. Federal Income Tax Matters -- For Federal income tax purposes, the cost and
unrealized appreciation (depreciation) in value of the investment securities
at December 31, 1998 are as follows:
Chase
Short-
Intermediate Chase
Chase Term U.S. U.S.
Chase Intermediate Government Government
Income Fund Securities Securities
Fund Bond Fund Fund Fund
------ ------------ ------------ -----------
Aggregate cost $57,674,003 $32,057,402 $29,689,562 $3,556,034
----------- ----------- ----------- ----------
Gross unrealized
appreciation $ 1,833,075 $ 524,433 $ 668,505 $ 39,213
Gross unrealized
depreciation (150,329) (12,247) (34,968) (7,077)
----------- ----------- ----------- ----------
Net unrealized
appreciation $ 1,682,746 $ 512,186 $ 633,537 $ 32,136
----------- ----------- ----------- ----------
----------- ----------- ----------- ----------
44
<PAGE>
Chase Funds
Notes to Financial Statements (continued)
5. Transactions in Shares of Beneficial Interest -- Transactions in Shares of
Beneficial Interest for the year ended December 31, 1998 were as follows:
Chase Income Fund
-----------------
Year Ended December 31,
Premier Shares 1998 1997
------------------------- ------------------------
Amount Shares Amount Shares
----------- -------- ------------ --------
Shares sold $20,818,571 1,013,32 $ 8,887,000 461,702
Shares issued in
reinvestment of
distributions 3,601,040 175,125 -- --
Shares redeemed (16,393,484) (797,904) (15,411,419) (806,698)
----------- -------- ------------ --------
Net increase (decrease)
in Trust shares
outstanding $ 8,026,127 390,550 $ (6,524,419) (344,996)
----------- -------- ------------ --------
----------- -------- ------------ --------
Chase Income Fund
-----------------
11/10/98*
Investor Shares Through 12/31/98
------------------------
Amount Shares
----------- --------
Shares sold $ 10,200 491
Shares issued in
reinvestment of
distributions 309 15
Shares redeemed - -
----------- --------
Net increase (decrease)
in Trust shares
outstanding $ 10,509 506
----------- --------
----------- --------
*Commencement of offering of class of shares.
Chase Intermediate Term Bond Fund
---------------------------------
Year Ended December 31,
Premier Shares 1998 1997
------------------------- ------------------------
Amount Shares Amount Shares
----------- --------- ------------ ---------
Shares sold $20,305,808 1,575,654 $14,646,175 1,218,217
Shares issued in
reinvestment of
distributions 1,431,546 110,823 - -
Shares redeemed (7,627,966) (590,674) (4,288,976) (344,539)
----------- --------- ------------ ---------
Net increase (decrease)
in Trust shares
outstanding $14,109,388 1,095,803 $10,357,199 873,678
----------- --------- ------------ ---------
----------- --------- ------------ ---------
Chase Intermediate Term Bond Fund
---------------------------------
11/10/98*
Investor Shares Through 12/31/98
------------------------
Amount Shares
----------- --------
Shares sold $ 10,200 790
Shares issued in
reinvestment of
distributions 187 15
Shares redeemed - -
----------- --------
Net increase (decrease)
in Trus shares
outstanding $ 10,387 805
----------- --------
----------- --------
*Commencement of offering of class of shares.
45
<PAGE>
Chase Funds
Notes to Financial Statements (continued)
Chase Money Market Fund
-----------------------
Year Ended December 31,
Premier Shares 1998 1997
--------------------------- --------------------------
Amount Shares Amount Shares
----------- ----------- ------------ -----------
Shares sold $241,189,199 241,189,199 $185,047,372 185,047,372
Shares issued in
reinvestment of
distributions 6,713,015 6,713,015 4,021,779 4,021,779
Shares redeemed (187,003,971) (187,003,971) (173,596,247) (173,596,247)
------------ ------------ ------------ ------------
Net increase
(decrease) in Trust
shares outstanding $ 60,898,243 60,898,243 $15,472,904 15,472,904
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------
Chase Money Market Fund
-----------------------
11/10/98*
Investor Shares Through 12/31/98
------------------------
Amount Shares
----------- --------
Shares sold $ 17,200 17,200
Shares issued in
reinvestment of
distributions 85 85
Shares redeemed - -
----------- --------
Net increase (decrease)
in Trust shares
outstanding $ 17,285 17,285
----------- --------
----------- --------
*Commencement of offering of class of shares.
Chase Short-Intermediate Term
U.S. Government Securities Fund
-------------------------------
Year Ended December 31,
Premier Shares 1998 1997
--------------------------- --------------------------
Amount Shares Amount Shares
----------- ----------- ------------ -----------
Shares sold $11,638,328 931,157 $ 7,667,388 641,679
Shares issued in
reinvestment of
distributions 1,292,791 103,032 - -
Shares redeemed (6,777,047) (540,647) (13,808,886) (1,158,939)
----------- ----------- ------------ -----------
Net increase
(decrease) in
Trust shares
outstanding $ 6,154,072 493,542 $ (6,141,498) (517,260)
----------- ----------- ------------ -----------
----------- ----------- ------------ -----------
Chase Short-Intermediate Term
U.S. Government Securities Fund
-------------------------------
11/10/98*
Investor Shares Through 12/31/98
------------------------
Amount Shares
----------- --------
Shares sold $ 10,200 807
Shares issued in
reinvestment of
distributions 102 8
Shares redeemed - -
----------- --------
Net increase
(decrease) in Trust
shares outstanding $ 10,302 815
----------- --------
----------- --------
*Commencement of offering of class of shares.
46
<PAGE>
Chase Funds
Notes to Financial Statements (continued)
Chase U.S. Government Securities Fund
-------------------------------------
Year Ended December 31,
Premier Shares 1998 1997
--------------------------- --------------------------
Amount Shares Amount Shares
----------- ----------- ------------ -----------
Shares sold $ 1,942,046 135,393 $ 772,453 59,298
Shares issued in
reinvestment of
distributions 285,667 20,394 -- --
Shares redeemed (1,471,493) (103,236) (849,728) (65,037)
----------- ----------- ------------ -----------
Net increase
(decrease) in Trust
shares outstanding $ 756,220 52,551 $ (77,275) (5,739)
----------- ----------- ------------ -----------
----------- ----------- ------------ -----------
Chase U.S. Government Securities Fund
-------------------------------------
11/10/98*
Investor Shares Through 12/31/98
------------------------
Amount Shares
----------- --------
Shares sold $ 10,200 708
Shares issued in
reinvestment of
distributions 557 40
Shares redeemed - -
----------- --------
Net increase (decrease)
in Trust shares
outstanding $ 10,757 748
----------- --------
----------- --------
*Commencement of offering of class of shares.
47
<PAGE>
- -----------------
Chase Income Fund
- -----------------
Finacial Highlights
<TABLE>
<CAPTION>
Investor
Premier Shares Shares
------------------------------------------------------- -----------
For the Years Ended December 31, 11/10/98**
------------------------------------------------------- Through
1998 1997 1996 1995 1994 12/31/98
-------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance
Net Asset Value, Beginning of Period .......... $ 20.18 $ 18.56 $ 18.21 $ 15.39 $ 16.11 $ 20.77
------------------------------------------------------------------
Income from Investment Operations:
Net Investment Income ................ 1.09 1.14 1.00 0.97 0.84 0.14
Net Gains or Losses in Securities ....
(both realized and
unrealized) ........................ 0.77 0.48 (0.65) 1.85 (1.56) 0.18
------------------------------------------------------------------
Total from Investment Operations ..... 1.86 1.62 0.35 2.82 (0.72) 0.32
------------------------------------------------------------------
Less Distributions:
Dividends from Net Investment Income.. 1.09 -- -- -- -- 0.15
Distributions from Capital Gains ..... 0.48 -- -- -- -- 0.48
------------------------------------------------------------------
Total Distributions .................. 1.57 -- -- -- -- 0.63
------------------------------------------------------------------
Net Asset Value, End of Period ................ $ 20.47 $ 20.18 $ 18.56 $ 18.21 $ 15.39 $ 20.46
------------------------------------------------------------------
------------------------------------------------------------------
Total Return .................................. 9.47% 8.73% 1.91% 18.38% (4.47)% 1.54%
Ratios/Supplemental Data:
Net Assets, End of Period (000 omitted) ....... $60,068 $ 51,329 $ 53,614 $ 57,452 $ 52,235 $ 10
Ratios to Average Net Assets #:
Expenses 0.75% 0.75% 0.75% 0.75% 0.75% 1.03%
Net Investment Income ................ 5.28% 5.82% 5.58% 5.77% 5.43% 4.72%
Expenses Without Waivers and
Assumption of Expenses ............. 0.94% 1.14% 1.07% 1.08% 1.07% 1.44%
Net Investment Income Without
Waivers and Assumption of Expenses.. 5.09% 5.43% 5.26% 5.44% 5.11% 4.31%
Portfolio Turnover Rate ....................... 54% 97% 72% 93% 239% 54%
</TABLE>
** Commencement of offering of class of shares.
# Short periods have been annualized.
See notes to financial statements.
48
<PAGE>
- ---------------------------------
Chase Intermediate Term Bond Fund
- ---------------------------------
Financial Highlights
<TABLE>
<CAPTION>
Investor
Premier Shares Shares
-------------------------------------------------------------- ----------
For the Years Ended December 31, 10/03/94* 11/10/98**
--------------------------------------------------------------
Through Through
1998 1997 1996 1995 1994 12/31/98
--------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance
Net Asset Value, Beginning of Period ....... $ 12.75 $ 11.89 $ 11.67 $ 9.99 $ 10.00 $ 12.91
-------------------------------------------------------------------------
Income from Investment Operations:
Net Investment Income ..................... 0.68 0.56 0.61 0.64 0.15 0.09
Net Gains or Losses in Securities
(both realized and unrealized) .......... 0.27 0.30 (0.39) 1.04 (0.16) 0.11
-------------------------------------------------------------------------
Total from Investment Operations .......... 0.95 0.86 0.22 1.68 (0.01) 0.20
-------------------------------------------------------------------------
Less Distributions:
Dividends from Net Investment Income ...... 0.68 -- -- -- -- 0.09
Distributions from Capital Gains .......... 0.15 -- -- -- -- 0.15
-------------------------------------------------------------------------
Total Distributions ..................... 0.83 -- -- -- -- 0.24
-------------------------------------------------------------------------
Net Asset Value, End of Period ............. $ 12.87 $ 12.75 $ 11.89 $ 11.67 $ 9.99 $ 12.87
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Total Return ............................... 7.63% 7.26% 1.86% 16.79% (0.32)% 1.52%
Ratios/Supplemental Data:
Net Assets, End of Period (000 omitted) ... $32,870 $18,595 $6,949 $ 5,031 $ 5,124 $ 10
Ratios to Average Net Assets #:
Expenses ................................. 0.75% 0.75% 0.75% 0.75% 0.75% 1.03%
Net Investment Income .................... 5.25% 5.61% 5.32% 5.89% 6.12% 4.64%
Expenses Without Waivers
and Assumption of Expenses .............. 1.27% 1.25% 1.42% 1.43% 1.38% 1.72%
Net Investment Income Without
Waivers and Assumption of Expenses ...... 4.73% 5.11% 4.65% 5.21% 5.49% 3.95%
Portfolio Turnover Rate .................... 135% 14% 134% 198% 7% 135%
</TABLE>
* Commencement of operations.
** Commencement of offering of class of shares.
# Short periods have been annualized.
See notes to financial statements.
49
<PAGE>
- -----------------------
Chase Money Market Fund
- -----------------------
Financial Highlights
<TABLE>
<CAPTION>
Investor
Premier Shares Shares
-------------------------------------------------- ----------
For the Years Ended December 31, 11/09/98**
-------------------------------------------------- Through
Per Share Operating Performance 1998 1997 1996 1995 1994 12/31/98
---------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period .............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------------------------------------------------------------
Income from Investment Operations:
Net Investment Income .................... 0.05 0.05 0.05 0.05 0.04 0.01
Net Gains or Losses in Securities
(both realized and unrealized) ......... -- -- -- -- -- --
----------------------------------------------------------------
Total from Investment Operations ......... 0.05 0.05 0.05 0.05 0.04 0.01
----------------------------------------------------------------
Less Distributions:
Dividends from Net Investment Income ..... 0.05 0.05 0.05 0.05 0.04 0.01
Distributions from Capital Gains ......... -- -- -- -- -- --
----------------------------------------------------------------
Total Distributions ...................... 0.05 0.05 0.05 0.05 0.04 0.01
----------------------------------------------------------------
Net Asset Value, End of Period .................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
================================================================
Total Return ...................................... 5.21% 5.10% 5.10% 5.70% 3.80% 0.69%
Ratios/Supplemental Data:
Net Assets, End of Period (000 omitted) .. $195,476 $134,579 $119,106 $ 71,310 $ 55,505 $ 17
Ratios to Average Net Assets #:
Expenses ................................. 0.50% 0.50% 0.50% 0.50% 0.50% 0.60%
Net Investment Income .................... 5.07% 5.09% 4.93% 5.43% 3.90% 4.72%
Expenses Without Waivers and Assumption of
Expenses ............................... 0.60% 0.74% 0.72% 0.72% 0.83% 0.80%
Net Investment Income Without Waivers and
Assumption of Expenses ................. 4.97% 4.85% 4.71% 5.21% 3.57% 4.52%
</TABLE>
** Commencement of offering of class shares.
# Short periods have been annualized.
See notes to financial statements.
50
<PAGE>
- -------------------------------
Chase Short-Intermediate Term
U.S. Government Securities Fund
- -------------------------------
Financial Highlights
<TABLE>
<CAPTION>
Investor
Premier Shares Shares
-------------------------------------------------------------- ----------
For the Years Ended December 31, 11/10/98**
--------------------------------------------------------------
Through
1998 1997 1996 1995 1994 12/31/98
---------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Per Share Operating Performance
Net Asset Value, Beginning of Period ....... $ 12.39 $ 11.66 $ 11.35 $ 10.14 $ 10.24 $ 12.64
---------------------------------------------------------------------------
Income from Investment Operations:
Net Investment Income ..................... 0.63 0.67 0.60 0.58 0.45 0.08
Net Gains or Losses in Securities
(both realized and unrealized) .......... 0.25 0.06 (0.29) 0.63 (0.55) --
---------------------------------------------------------------------------
Total from Investment Operations ......... 0.88 0.73 0.31 1.21 (0.10) 0.08
Less Distributions:
Dividends from Net Investment Income ..... 0.63 -- -- -- -- 0.09
Distributions from Capital Gains ......... 0.04 -- -- -- -- 0.04
---------------------------------------------------------------------------
Total Distributions ................... 0.67 -- -- -- -- 0.13
---------------------------------------------------------------------------
Net Asset Value, End of Period ............. $ 12.60 $ 12.39 $ 11.66 $ 11.35 $ 10.14 $ 12.59
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Total Return ............................... 7.35% 6.30% 2.68% 12.01% (1.05)% 0.60%
Ratios/Supplemental Data:
Net Assets, End of Period (000 omitted) .. $ 30,554 $ 23,948 $ 28,551 $ 28,783 $ 22,992 $ 10
Ratios to Average Net Assets #:
Expenses ................................. 0.75% 0.75% 0.75% 0.75% 0.75% 1.03%
Net Investment Income .................... 5.06% 5.40% 5.26% 5.38% 4.41% 4.47%
Expenses Without Waivers and
Assumption of Expenses ................. 1.12% 1.01% 0.88% 0.91% 0.96% 1.58%
Net Investment Income Without
Waivers and Assumption of Expenses ..... 4.69% 5.14% 5.13% 5.22% 4.20% 3.92%
Portfolio Turnover Rate .................... 87% 63% 177% 187% 268% 87%
</TABLE>
**Commencement of offering of class of shares.
# Short periods have been annualized.
See notes to financial statements.
51
<PAGE>
- -------------------------------------
Chase U.S. Government Securities Fund
- -------------------------------------
Financial Highlights
<TABLE>
<CAPTION>
Investor
Premier Shares Shares
---------------------------------------------------- -----------
For the Years Ended December 31, 11/10/98**
---------------------------------------------------- Through
Per Share Operating Performance 1998 1997 1996 1995 1994 12/31/98
-----------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period ........................ $ 13.98 $ 12.76 $ 13.01 $ 10.00 $ 10.91 $ 14.42
-----------------------------------------------------------------
Income from Investment Operations:
Net Investment Income .............................. 0.72 0.75 0.74 0.73 0.62 0.09
Net Gains or Losses in Securities
(both realized and unrealized) ..................... 0.54 0.47 (0.99) 2.28 (1.53) 0.10
-----------------------------------------------------------------
Total from Investment Operations ................... 1.26 1.22 (0.25) 3.01 (0.91) 0.19
-----------------------------------------------------------------
Less Distributions:
Dividends from Net Investment Income ............... 0.72 -- -- -- -- 0.09
Distributions from Capital Gains ................... 0.68 -- -- -- -- 0.68
In Excess of Realized Capital Gains................. 0.01 -- -- -- -- 0.01
-----------------------------------------------------------------
Total Distributions ................................ 1.41 -- -- -- -- 0.78
-----------------------------------------------------------------
Net Asset Value, End of Period .............................. $ 13.83 $ 13.98 $ 12.76 $ 13.01 $ 10.00 $ 13.83
=================================================================
Total Return ................................................ 9.28% 9.55% (1.89)% 30.11% (8.39)% 1.37%
Ratios/Supplemental Data:
Net Assets, End of Period (000 omitted) ............ $ 3,624 $ 2,928 $ 2,746 $ 2,877 $ 2,628 $ 10
Ratios to Average Net Assets #:
Expenses ........................................... 0.75% 0.75% 0.75% 0.75% 0.75% 1.03%
Net Investment Income .............................. 5.07% 5.73% 6.01% 6.38% 6.23% 4.45%
Expenses Without Waivers and Assumption of
Expenses............................................ 1.45% 3.15% 2.09% 2.22% 2.38% 1.92%
Net Investment Income Without Waivers and
Assumption of Expenses ............................. 4.37% 3.33% 4.67% 4.91% 4.60% 3.56%
Portfolio Turnover Rate ..................................... 110% 87% 48% 17% 174% 110%
</TABLE>
** Commencement of offering of class of shares.
# Short periods have been annualized.
See notes to financial statements.
52
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Trustees and Shareholders of
Mutual Fund Investment Trust
In our opinion, the accompanying statement of assets and liabilities, including
the portfolios of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of Chase Income Fund, Chase
Intermediate Term Bond Fund, Chase Money Market Fund, Chase Short-Intermediate
Term U.S. Government Securities Fund and Chase U.S. Government Securities Fund
(separate portfolios of Mutual Fund Investment Trust, hereafter referred to as
the "Trust") at December 31, 1998, the results of each of their operations for
the year then ended, the changes in each of their net assets for each of the two
years in the period then ended and the financial highlights for each of the
periods presented, in conformity with generally accepted accounting principles.
These financial statements and financial highlights (hereafter referred to as
"financial statements") are the responsibility of the Trust's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with generally accepted auditing standards which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of securities at
December 31, 1998 by correspondence with the custodian and brokers, provide a
reasonable basis for the opinion expressed above.
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, New York 10036
February 8, 1999
53
<PAGE>
[This Page Intentionally Left Blank]
54
<PAGE>
Chase Funds are distributed by Chase Fund Distributors, Inc. which is
unaffiliated with The Chase Manhattan Bank. Chase and its respective affiliates
receive compensation from Chase Funds for providing investment advisory and
other services.
This report is submitted for the general information of the shareholders of the
Funds. It is not authorized for distribution to prospective investors in the
Funds unless preceded or accompanied by a prospectus.
To obtain a prospectus for any of the Chase Funds, call 1-888-5-CHASE-0. The
prospectus contains more complete information, including charges and expenses.
Please read it carefully before you invest or send money.
|----------|-------------------|
|NOT | May Lose Value |
|FDIC | |
|INSURED | No Bank Guarantee |
|----------|-------------------|
<PAGE>
[LOGO]
CHASE FUNDS(Service Mark)
Chase Funds Fulfillment Center
393 Manley Street
West Bridgewater, MA 02379
Chase Funds(Service Mark). Invest With Power.
Chase Funds Service Center
210 West 10th Street
Kansas City, MO 64105
Legal Counsel
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, NY 10017
Independent Accountants
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, NY 10036
